>> good morning, welcome to the budget and finance committee. my name is supervisor john avalos, the chair of the committee. i'm joined to my right by supervisor sean elsbernd, and my left supervisor ross mirkarimi. the clerk of the committee is mr. viktor young. mr. clerk, do we have any announcements? >> yes. if you turn off all cell phones and pagers. if you wish to speak during public comment, please fill out a speaker card and turn them in to me. if you provide documents to the

committee please provide one to the clerk for influential into the final. it will appear on the board of supervisors agenda on september 14, 2010 unless other weiss stated. commissioner avalos: please call item number one. >> item number one, resolution authorizing the san francisco department of public health, community behavioral health services to enter into a negotiated amount and drug medical recommitment with the state of department of alcohol and drug program. commissioner avalos: very good. do we have a presentation from d.p.h.? >> good morning, supervisors. i'm dr. alice glickhorn, i am the county alcohol and drug administrator. this is our funding for medical from the state. it comes in the form of a three-year agreement. the negotiated net amount. the combined amount is approximately $60 million. and i'm happy to answer any

questions that we have on this. >> great, thank you. mr. rhodes, share with us the report. >> mr. chairman, members of the committee, this agreement with the state is required. it would provide reimbursement to the department of public health. we recommend that you amend the resolution to retroactively approve it since the agreement starts on july 1 and we recommend you approve the resolution as amended. commissioner avalos: thank you. just a question about the prognosis for state funding. what's the range that we would expect that we could receive from the state based on what could happen with the state budget? >> we expect to receive this full amount because it's a federal requirement. commissioner avalos: but we are talking about part of this is state funding the block grant from the feds and part is state funding as well? >> i don't anticipate this will be affected.

we still don't have a budget. commissioner avalos: ok. little different from what i had heard and read in the report. >> mr. chairman, members of the committee, monique smuda from the controller's office. the agreement is under the medicaid program and so long as the city and county provides the services, and consistent with the substance abuse, mental health, and so on the funds should be coming in. the issue may be one of cash flow. and again pending the approval of the budget, the cash may be interrupted. however within the controller's office and our cash flow work, we ensure that departments have sufficient moneys to be able to pay their employees, their contractors, and so on in the interim. but we have not heard that this particular program was subject to any reductions at this point.

commissioner avalos: ok. great. thank you. we can open this up for public comment. any member of the 3ub lick like to comment on item number one? seeing none, we'll close public comment. and motion to accept. taken without objection. full forward with recommendation. wait, we have -- with the budget analysis recommendation. ok. mr. young, if you could please call item number two. >> item number two, ordnance authorizing the department of emergency management to retroactively accept and expend a grant in the amount of $231,000 from the california volunteers for the grant period of 18 months following passage of the fiscal year 2010, 2011 california state budget. for volume tour management and training. san francisco fire department.

a good morning, mr. chairman. members of the committee. i'm here on behalf of the fire department to give a brief summary of this grant. grant from california volunteers organization to train 200 individuals to the level of disaster corps volunteers in the state of california. california volunteers is a state-run organization by the government's office that's responsible for ensuring coordination of volunteer activities related to disaster response and recovery throughout the state, including the training, equipment, and transportation provisions that are required. the purpose of the grant from the state's perspective is to increase the pool available to them of volunteers that are trained and incorporated into the state's disaster corps program. the disaster corps program is a more advanced level of volunteers fully integrated into the state's emergency management

system. as the members in this group have a higher level of training, they can be called upon by the state and deployed to event as needed by the state. san francisco currently doesn't have the disaster corps level of training offered to volunteers. the level of training qualifications required exceed current curriculum of programs and includes requirements such as c.p.r., first aid certification, as well as comprehensive background check. the goal of the grant at the further request of the state is to train 200 individuals to be eligible and have the requirements to be incorporated into the disaster core program to be called as a resource by the state if needed. these individuals would be made up of combination of both current nert volunteers that were interested in enhancing their response capabilities, and individuals who had no prior training who would incorporate into the program before completing their disaster corps training.

there is a planner f.t.e. as part of this grant. this person would be responsible for coordination of additional training and background check for the 200 individuals. worked closely with both nert and d.e.m. to accomplish this. it covers all costs to provide this additional training as well as background checks funding and any additional materials and supplies that would be needed. the scope of the grant is limited to the enhanced disaster corps training and could not be used to complement or supplant any current training. if you have any additional questions, i'm more than happy to assist with them and also have representatives from nert and d.e.m. to answer anything. thank you. commissioner avalos: this grant will be for 18 months? >> yes. contingent upon the passing of the california budget. but it is federal homeland security funding. it's not necessarily directly related to the budget issues at the state level. commissioner avalos: in terms of longevity of funding for this beyond that time, is there a

long-term plan about how this type of service will be continued? >> management will be if you can sess isful incorporate into our efforts to seek grant funding for the position. probably through additional state or homeland security funding. commissioner avalos: so then we would expect there will be overall the state and federal level there will be funding that could go for this. we have to apply for it. >> that's what we are hoping for. that's the expectation they'll continue the program. commissioner avalos: just relative to other counties, areas, is this -- >> we are assuming this goes one of five jurisdictions that were selected. i think los angeles, san diego, riverside, and/or rang county. i think we are the only one in northern california selected commissioner avalos: great. ok. if there are no other questions from the panel here, thank you for your presentation. we'll open this up for public

comment. any member of the public who would like to comment on item number two, please come forward. seeing no one come forward. we'll close public comment. >> motion to accept the recommendation. commissioner avalos: motion from supervisor myrrh car reamy. without objection. we move forward. mr. young, if you could please call items number 3 through 7, please. >> item number three, ordnance providing revenue and levying property taxes for city and county purposes in establishing pass-through rates for residential tenants pursuant to chapter 37 of the administrative code end something up june 30, to 10. >> item number four, ordnance providing revenue and levying property taxes ending june 30, 2010. item number five, ordnance providing revenue and levying property taxes for san francisco unified school district ending june 30, 2011.

item number six, order nansd providing for revenue levying property taxes for fran bay rapid transit district. item number seven. resolution establishing the appropriations limit for fiscal year pursuant to california constitution. commissioner avalos: thank you. >> i'm kneel levinson. -- neil levinson. what you have before you is probably one of the most important pieces of legislation. or several. as it brings in over $1 billion of our general fund as well as the other entities. what we have with these four ordinances is a property tax rate which comes to $1.164 per $100 of assessed value. this is a very slight increase from the prior year. largely as a result of increased debt obligations of the school district. the impact on a home that was assessed at $500 a year before

-- $500,000 a year before is approximately $8.62. when you combine the fact that the assessment -- that's a $400,000 is the analysis that we did. is about an $8.62 increase in their taxes from a level of $4,555, to $4,563 rounded. that's as a result of people who have not had other adjustments in their property tax this year would have seen a slight reduction in their assessed value through the automatic cost of living increase. because of an actual negative in the cola, then the slight increase by this rate results in about $8.62 increase. i'll be happy to answer any questions about the components of the rates. the other piece of legislation before you is required by the state constitution that there be a report on the limit that limits the amount of spending under certain conditions for both the state and local

governments. what our report shows is that the city remains well under our limits. this establishes what the limit would be for the city for these types of spending is about $2.4 billion. and that the amount of spending subject to this requirement is under $2.1 billion so that we are still well within that limit and don't have to take any special actions as a result of it. commissioner avalos: has there ever been an occasion where the city has gone over that or gotten close to that limit? >> no. commissioner avalos: ok. thank you for your presentation. mr. rhodes? >> mr. chairman, members of the committee, the only thing i would add is we used a $500,000 example for a single family residence that would result in an $11 increase in the property taxes. we recommend approval of all of this legislation. commissioner avalos: very good. thank you.

comments, questions? we'll open this up for public comment. thank you mr. levinson. item three through seven are open for public comment. we will close public comment. >> motion to advance with recommendation. commissioner avalos: we can take that without objection. all those will go to the full board with the recommendation. mr. young, if you could please call items number 8 and 9. >> item number 8, resolution aprolving an authorizing execution of amendment number 1 to lease, use, and operating agreement for bart station and related facilities and grant of easement at san francisco international airport, leeze number l 97-0081. item number nine, resolution approving the terminal two news stand coffee and specialty stores lease we'll host international incorporate the and the city and county of san francisco, acting by and through its airport commission. commissioner avalos: thank you, mr. young.

>> thank you. welcome back. good afternoon, supervisors. kathy weidner with san francisco international airport. i'll address item number 8 to begin with. which is a lease modification to the airport's lease use and operating agreement for the bart station of the airport. as you may recall, bart fairs to and from the san francisco station include a premium fare and in july of 2009, bart increased that premium fare from $1.50 per ride to $4. this increase represented a substantial increase at the cost for airline, airport employees to take the bart system to and from the airport every day. so when that increase in the premium fair began, the airport started a free shuttle service for airport employees from the bart station to the

international terminal at the airport. commissioner avalos: that was for city airport employees? >> yes. for city employees who work at the airport. airline employees were also eligible to use it, although their 25% discount that pre-existed this agreement with part was in place. so many of them just continued their normal routines. at the same time that we started the shuttle, san francisco airport and bart also sat down to try to negotiate a compromise to make the premium fees go back to the $1.50 from the $4 for airport employees. after a series of meetings and discussions and concessions, the result of those negotiations are what are before you today in the form of lease modification. the airport has agreed to certain changes in the current lease that we have with bart in an attempt to get the $1.50

surcharge imposed just for airport employees. and that is the -- that was our priority in making some of these concessions. the airport does believe this is the best way to address the situation for our employees, and we both the airport commission and our board of directors has approved the agreement. and we ask for your approval as well. i would be happy to answer. there are a lot of specifics, i would be happy to answer any of the questions you might have. >> just one place i haven't -- one part, one piece i haven't really heard much about is from airport employees. particularly by email, haven't gotten too many calls what the response has been from airport employees, were they part of negotiation, how were they informed about what went on in terms of negotiation to get back to the $1.50 level? >> there were many, many meetings with airport employees.

i think mostly through unions when the surcharge was originally increased. we had lots of public comment at our airport commission meetings around this item. our airport commissioners heard from them. i believe that maybe what happened is once the shuttle started running they felt like, at least they had another option. so maybe perhaps that's why you hadn't heard -- you didn't hear directly. the airport staff has heard from them and this is something that has -- that is very important. it's a big chunk on top of the fair they already paid to ride the system. and it makes a big difference. hundreds of dollars for some folks per month. so this returning to the $1.50 at least brings them back to what they were used to paying about a year ago. so we have gotten good feedback on this compromise. commissioner avalos: when do we expect the shuttle service to be discontinued? >> we have agreed with bart that

once we have approval from this board on the agreement, we will notify employees and we will discontinue the shuttle service within a month. 30 days. commissioner avalos: it seems like that disruption is a place where you're going to see -- now that people are not paying premium and they'll see a dent in their pocketbook, happy to pay now the new -- the re-established premium to the airport, which i support. i just think that that's part of -- that disruption could be something you might hear from. i might hear from as well. what you are anticipating to be the response. >> we have been in communications with the folks that depend on the shuttle right now. we have done surveys. we have handed out information notice about what we are planning to do and asking approval for. so i don't -- i think everyone knew that the shuttle was always temporary. actually went on probably longer

than the airport anticipated originally. but i don't think it will be a surprise. everyone who rides the shuttle has received a number of communications around this issue. they know that the shuttle is coming close to an end if we get approval on the agreement from the board. commissioner avalos: great. >> i was in the airport last weekend. don't you even have notices up all over the place by the bart station to employees? >> the bart shuttle from the station comes right to basically outside of the curb at the international terminal where the bart station is, i believe there has been a series of communications posted there. i haven't seen them recently but in the past. i'm not surprised to hear there is a new one. >> there is. i have seen it as well going through the airport. what's the population of employees we are talking about? >> bart estimates it's about i believe 6%. let me make sure that's right. i'm sorry, 3% of all bart trips

to and from the airport are airport employees. and again it's hard for us to know exactly who is riding the system. we believe it's a few hundred people a day who are airport employees who ride the bart system to and from the airport. >> is it possible in this conversation, can you remind me what the parking policy is for airport employees? >> for city employees who work at the airport, airport commission employees, parking is provided. for any tenants -- are we talking city employees? or anyone who works at the airport? >> city employees. then other. >> city employees are provided parking if they need it. you have to apply and you get a permit and there is space at the airport depending on where your office is. it's not all airport terminals. some is off airport. some of it is in the parking structure at the terminal. but if you are a city employee

who works at the airport you are provide add parking space. >> and that's gratis? >> one more time? >> free. >> yes. >> then for those who work at the airport but not city employees, what is the policy? >> for airline employees and for folks who rent space, concessions, people who work for our concessionaires, that's part of our contract with the company that leases space from the airport. so that ends up being some of the companies pass-through the cost to the employee. they can purchase it back if they'd like. some provide it free as well. i think that there are some airlines who have spaces that they don't charge their employees to use. >> i know you do not come here prepared to talk about that, but i would love to get a little more spess physicality on what -- specificity on what that real population is of parking spaces

used? >> numbers, you'd like numbers. >> i would appreciate that. >> that we provide for free and we receive rent? >> that's correct. thank you. that would be very helpful. i'll share it with my colleagues. >> ok. commissioner avalos: while we are on bart airport contract, let's have mr. rhodes present the analysis report. >> mr. chairman, members of the committee, i'll add a few comments. first of all the airport receives $2.5 million a year from bart. that was an agreement previously approved by the board of supervisors and that's for the debt service, flat, over 50 years. under the existing agreement, bart pays that $2.5 million in advance. under this proposed agreement,

bart wants to be treated like other airport tenants so that they would pay on a monthly basis therefore the airport would lose the interest income that they are earning now which is not that much. it's about $16,000, $17,000 a year, about 1.5%. it's not a big deal, but it's something that i want to bring to your attention. the airport would get no portion of the advertising revenues if you permit bart to advertise at the airport. however under prior agreements between the m.t.a. and bart, the n.t.a. actually receives advertising revenues from bart in all bart stations throughout the bay area. and in this particular case if you approve this agreement, it's

estimated that the n.t.a. would receive about 15% of $64,000 in fiscal year 2010-2011. this is based on the minimum annual guarantee bart gets from its advertising contractor, and about 15% of $487,000. so that's -- the n.t.a. would receive a minimum based on that of about $467,000 from bart and that's through september 30 of 2018. the airport receives no revenues. on the other hand, if you approve this agreement, the free shuttle bus, which is costing the airport over $500,000 a year, will be eliminated. so that certainly is a benefit and it's already been explained the benefit to the employees by getting the reduction from $4 to $1.50 in order to go directly to

bart. supervisor, i think that's the important issues in our report. and because of the aesthetics issue which members of the board of supervisors has raised in the past, we consider this matter to be policy for the board of suse advisors. commissioner avalos: thank you, mr. rhodes. any other questions? on this contract? then let's go on to the lease item. >> supervisors, i will address item number 9 which is what we hope to be one of the last, there may be one other coming, but you have approved over the last few months a series of new leases for the terminal 2 opening which we hope will -- we anticipate to be opened spring of this year. or 2011. this is a piece of the larger

concession program that you approved. this was something that came in originally and staff decided some of the concepts we received could be flushed out a little bit. so this went back and came in on its own. this is a new lease in terminal 2 with host international to operate a news stand, coffee, and specialty store operations. it consists of five separate spaces, only one of which is presecurity, a coffee shop. there is a large news stand and gift store, another small news stand in another location, post security. a clothing, retail outlet, and specialty keels outlet. it consists of five different sites under this one lease with host. the lease term is for 10 years. and the grant with no options to extend. the rent is the greater of either a minimum annual guarantee or the formula of percentage rent based on gross

revenues that you have seen on all the other leases. the mag for this lease is $1.12 million, although based on the protections of sales we believe that this contract will be paying on a percentage rent, at least in the first year, with an estimated rent in the first year of $1.320 million. the award of this lease is based on a competitive request for proposal process with host deemed to be the most responsive and responsible there. i would be happy to answer any questions. >> thank you. commissioner avalos: thank you for your presentation. mr. rhodes. >> mr. chairman, members of the committee. this was an r and p process. host has been recommended as the winning bid iror proposal. i would point out on page 2 of our report that host has bid the

lowest minimum annual guarantee of $1,126,000. i point that out just a as a matter of fact. however when you consider all of the criteria that the airport used in their evaluation, host is the winning bidder and we do not question that. we recommend that you approve this legislation. commissioner avalos: great. thank you. so we are about in terms of the incidents for the first year of the lease we are about $200,000 over the mag? >> yes. based on projected sales for the five different locations. both host and airport staff has looked at the projections and agreed they will most likely pay the percentage rent not the magazine commissioner avalos: i found it interesting in the report -- mags. commissioner avalos: i found it interesting in the report, one of the primary factors being considered, that there are a lot of bids that turned out to be

not able to get to the mag. i'm wondering how common that was in the past just for my own information. >> i believe that that may have been part of why this is separated out from the original package that came to you. airport staff who looks at these mags and traffic and projected sales i think we are just not comfortable with the concepts that were originally prevented. meaning they probably wouldn't going to get close to their mag. commissioner avalos: was that paced on experience? a -- based on experience? >> i think it's based on looking what happened in the past. location of the different sites. and the traffic that we anticipate to be moving through there. that is why i believe this came as a separate item. they brought it back in house to re-evaluate and look at different concepts that would ensure better success so that we would prefer that they exceed th