>> small business commission meeting, the meeting is called to order. item no. 1 is roll call. commission clyde? >> here. >> commissioner dooley. >> here. >> commissioner o'connor. >> here. >> commissioner kasselman?

>> here. >> commissioner o'brien is absent. you're on no. 2, certificates of honor recognizing a local small business as part of the small business recognition program. >> good afternoon, today we're honoring steve black, owner of lush lounge on polk street. he started his business in the year 2000 and has proved to be a really good neighbor in all respects. he is part of the lower polk street neighbors. he's active in all areas. he's worked very hard on helping keep the neighborhood safer and

because of all these many years that he has done such a great job, on polk street, we honor him today. mr. black, i'm going to read your award. on this monday, september 14, 2010, the small business commission is proud to acknowledge the contributions that lush lounge has made to the vitality of san francisco, exemplifying the passion and energy that small businesses contribute to the city. lush lounge has been a strong contributor of the revitalization of the lower polk street neighborhood and actively participating in programs to help keep the neighborhood safe. the commission also recognizes steve black, the proprietor of lush lounge, for instilling an entrepreneurial spirit in his

employees and managers, several of which have gone on to own a lounge. the small business commission is glad to recognize lush lounge for their over 10 years to the city and county of san francisco. [applause] >> first of all, i very much appreciate it. who would have ever thought that a lounge would be small business and bet recognized. i first came to san francisco 1999 for a thanksgiving reecked. i had three restaurants in south florida, skyed to come back three years later to live here. i saw a classified ad for a bar on sale on the corner of polk. my friends said, what are you doing, get out of that as quickly as possible. but i believe i'm like michael landon on "little house on the

prairie," if i come out there and build my cabin, people will follow me, homestead there, homestead there. and over the last 10 years, it's been a long journey, but it didn't start with a lot of hard work, working with captain alex sagan at northern station, working with the department of public works, making sure our streets were cleaned, working with golden gate disposal, asking for a trash receptacle in front of our business so it's sort of the small businesses that keep the glue together in our city here and i can see where, as we go into redeveloping mid market, the small businesses will have a big, big impact in that. and my district supervisor, david chu, i believe he was a commissioner here, as well. so we have a lot of history in getting where we are and who would have thought after being in business on the corner of polk and post that we would be

featured on the food network channel, they would come and film a show on us. so that was really a great pat on the back. so i think any neighborhood in this city has the ability to turn around and to go forward such as lush lounge has done and we also have a person here in the room that's been of great assistance to us, chris schulman. about three years ago when he was with the office of the mayor in economic development, he came in and began to bring all of the businesses together. he was like a foot soldier. when you run a business, you don't have time to meet the neighbors and get to know everybody so he was a great ambassador of bringing, i believe, our corridor together. with his help and bar owners coming together, we have on our own, i have a special foot patrol on friday and saturday nights, hired out of our pockets to make sure our streets are safe and clean and there's no

trouble. finally, i think the commissioners on this board have a lot to do and in common with what i do as we listen to people talk and talk and talk. so whenever you'd like to move on to another job, bring me your resume, i think you'd work well behind the back of a bar. thank you very much. [applause] >> congratulations. next item, please? >> commissioners, you are now on item no. 3, approval of the july 12, 2010 meeting minutes, explanatory documents, draft july 12, 2010 minutes.

>> i have a couple of changes, if the commissioners would give me -- yeah, just a couple. let's see, this is the monday, august 9 minutes. >> i'm sorry, i thought you called them together. i have one change and i think i actually amended it on your copy with your secretary and that is, i would like you to change the words "look after the city keep looking at ways to target the alcohol industry itself" and that's on -- let's see. pages report number said. >> page 4.

>> page 4, commissioner clyde, the first paragraph with my name on it, the very last line of that paragraph, i would like to amend that to say that the city keep looking -- "the city take a regional approach to this issue, possibly using the membership of supervisor affalo in the association of bay area government." let's see. okay, thank you. with that change, can we -- >> okay. move to approve the july minutes with amendments. >> i second. >> those in favor?

>> aye. >> next item, please. >> commissioners, item no. 4, approval of the august 9, 2010, meeting minutes, explanatory documents draft august 9, 2010 minutes. >> and i have a change on this one, as well. and that's in the vice president's report, under item 13, i would just like to add the words to this line, "commissioner clyde began her report by recognizing joni chang, a former city employee with the office of labor standards enforcement, whose primary responsibility was the implementation of san francisco's healthcare security ordinance." thank you. >> do i have a motion? >> second.

>> those in favor? >> aye. >> next item, please. >> commissioners, we are now on item no. 5, general public comment. this allows members of the public to comment generally on matters within the commission's purview and suggest new agenda items for the commission's future consideration. >> any public comments? seeing none, public comment is closed. next item, please. >> commissioners, item no. 6, discussion and possible action to make recommendations to the board of supervisors on board of supervisors file no. 101105, existing commercial buildings energy performance ordinance. this is an ordinance in many of the san francisco environment code -- to adopt the

san francisco existing commercial buildings energy performance ordinance. >> thank you so much for the invitation to present to you today. mayor newsome introduced a new ordinance on august 10 called the existing commercial buildings energy performance ordinance, so we'd like to give you an overview of that today and solicit your comments and feedback. as you know, buildings account for 45% of greenhouse gases in san francisco and of that, commercial buildings and city operations account for about 2/3 of those greenhouse gases. last year, mayor newsome brought together a task force of local

experts on existing and commercial buildings to help the mayor and the city think about ways to reduce greenhouse gas emissions and increase efficient in those existing commercial buildings. the existing commercial building task force included 19 stakeholders from the building industry and from the energy efficiency building ownership developer financial and general business sector. they met for several months and in december 2009 presented a set of recommendations which are available to you. i believe you may have the executive summary of those recommendations in your packet. the two key recommendations that the mayor has been very interested in acting upon were to require building owners to conduct an energy audit to identify all the cost-effective

ways that they could reduce their energy use, and to require reporting of each nonresidential building's energy performance annually. a number of other cities have implemented this ordinance effectively and san francisco is about the fifth or sixth city around the country to consider such an ordinance. based on the task force recommendations in december, mayor newsom directed the department of the environment to develop the ordinance and the commercial buildings energy performance ordinance, i believe you have a copy of that in your packet. similar legislation has been passed at the state level and will be -- is scheduled to be implemented in early 2011, which would require similar requirements for commercial operations in the state of california to disclose energy usage information at the time of a major financial transaction,

either renting -- renting a major unit, the time of sale, or refinance of that property. the draft -- the ordinance which was introduced on august 10 requires buildings to conduct an energy audit every five years unless they have done similar audits in the past and have met certain performance benchmarks or if they are undergoing certain financial hardships, there are exemptions for those types of buildings. this would apply only to commercial buildings and would not apply to either residential or mixed-use buildings in the city. and it would also require them to submit annual reports to the city describing, documenting their energy usage. the energy audits would be rolled in over a five-year period so as not to require all of the buildings to conduct the energy audits in the first year.

it would require the largest buildings in the first year and then phase it in over the next five years for the remainder of the buildings. the energy performance data that would be reported to the city is the ordinance requires that they use the same software that is required by the state statewide legislation. that is the outline of the ordinance. i'm happy to answer any questions. i have mark wes lin from the department of the environment and barry hooper from the department of the environment that can answer questions, as well. >> anybody have any questions? >> you said you want to use the same applications at the state level. does that mean they have to purchase a software application for their computer to use this, sore is there one on a server that they can access that's for everybody. >> the software is a free software made available through the epa.

it's called the epa energy star portfolio manager and that software is available for free and we have a -- an implementation schedule that would -- an outreach schedule that would have the department of the environment taking the lead on outreach to businesses to make sure that they've been educated on how to use the software and we've been discussing with pg&e opportunities to educate through classes or specialized technical assistance for those that are not familiar with the software. >> thank you. >> commissioner dooley. commissioner dooley: i have two questions. can you give me an idea of what the average cost is for the procedure? i know they're different prices, buildings, but can you give me an idea? >> sure. i might ask barry to give you an idea of the typical cost of an energy audit. >> you were right on the money, that it can be very variable.

if the building owner were to pay for it out of pocket, the range could be between 3 cents and 15 cents a square foot. however, we would expect the majority of building owners to seek assistance they're bittled to from -- entitled to from the energy watch program and those are rate-pair funded programs that help them take advantage of about a billion dollar a year we invest as californians in energy efficiency. they involve a free energy audit so many building owners would receive a free audit. quite a lot of larger facilities, as well, may be exempt, because there's been a lot of activity in demonstrating exemplary energy performance, earning energy recognition. so the out-of-pocket cost is expected to be [inaudible] other than buildings that are looking

to take advantage of this opportunity and really look for a very detailed information voluntarily, and to seek that external engineering system. commissioner dooley: thank you. >> what are the costs? do we pay someone to come in and do the audit? >> that would be an option to obtain the audit. the audit standard is asked for in the ordinance is what was recognized by the task force is a credible way of getting a comprehensive picture of how a building operates so that a building owner would get a detailed picture of exactly what sort of cost-effective measures would be available to them to improve their own building, so they could either obtain a free audit in many cases from our energy watch program that's helped about 8800 businesses in san francisco. it's energy watch and a couple of previous programs under different names have helped 8800

different businesses over the last 10 years and they've brought in about $25 million in incentives in technical assistance for the city and that's been growing each year over that period of time as has pgxe's direct investment, as well. yes, they certainly could pay for an audit but there are resources to help business owners janet. >> what about time frame? >> we put in your packet a separate graphic summary that includes a time line for the two major actions, the auditing and summarizing in the top level, basically 20% of the building stock would be audited each year over the first five years of implementation. and then on the lower level, you can see the benchmarking would

be phased in according to a schedule that matches the status taking under ab1103 legislation, where the state legislation would require benchmarking at the time of a major financial transaction to be date certain but phased in on the same kind of schedule. so it would be predictable and use the same tools the state uses and the information, once it's set up, is free to be maintained and actually pg&e uploads your energy for free on an ongoing basis so it should be -- a lot of tools in place to make it as easy as possible, a picture of where your building stands relative to its peers. >> does it clash at all with the controversy around the new smart meters? or is this totally separate and they don't cross paths in any

way? >> very separate. the energy star is the free tool that's been available for about 10 years. it's just a web site operating is equally as easy and complicated, depending on your perspective, as buying something from amazon.com or something like that. you need to operate a web site. but the information that's used is basic descriptive information of the building so you can put the energy use into context and make a fair comparison against other buildings and monthly energy usage for all of the meters that serve the building. smart meters, that's more an issue of very detailed information down to the seconds. everybody already has that monthly energy data. >> thank you. >> public comment?

seeing none, public comment closed. discussion? >> i really don't have anything to add. i think considering that we're talking about energy costs, i think this has been on just about every building owner's radar and business person's radar for several years. i would assume that most businesses or most building owners are way ahead of the curve on this, fortunately. so i think we should just move this with recommendation forward. >> i second. >> that's my motion. >> i have a motion to support this. do i have a second? >> second. >> those in favor. >> aye. >> thank you. motion carries. next item, please. >> you want to call the next two items together? >> let's do that.

>> commissioners, you are on item no. 7, discussion and possible action to make recommendations to the board of supervisors, on board of supervisors file no. 101006, revisions to local business enterprise ordinance, an ordinance amendingstrative code chapter 14b, also, item 8, discussion and possible action to make recommendations to the board of supervisors on board of supervisors file no. 101007, revising requirements for purchasing goods and services. this is an ordinance amending administrative code chapters 21 and 21c to conform purchasing requirements to administrative code chapter 14b. we have a presentation by katy tang, legislative aide to supervisor carmen chu. >> good evening, commissioners, katy tang. thank you for taking the time to

consider these few pieces of legislation. we had these two pieces of legislation go before the human rights commission as well as the legislative subcommittee of the small business commission so we think the subcommittee gave unanimous support on this and hopefully most of the questions were answered there. back in february, we had legislation sponsored by supervisor chu also that touched upon chapter 6, chapter 14b and chapter 21, the admin code. basically, the package of legislation was to help streamline our city's contracting processes and increase business opportunities for our local sa businesses. the legislation before you today really builds upon that work with the following amendments. so we'll start first with chapter 14b and walk you through it really quickly. one of the things that it would do is increase the threshold for general services contracts, so, for instance, janitorial, security guard, pest control, and it would increase the threshold from $100,000 to

$400,000. actually, back in february, we had legislation that increased the thresholds for construction contracts up to $400,000, as well as professional and architectural services to $100,000. so, again, we decided to pursue this change because it would create a greater ease in entering into multi-year contracts and would help create more micro-leb opportunities. the other thing the legislation would do is give the human rights commission more flexibility in terms of certifying firms that do not meet the 51% ownership requirement but have otherwise demonstrated that the qualifying owners have controlled the business. and this change felt like it was needed to address the complex ownership structures that some small businesses may have. another change is, it would change the micro-leb set-aside requirements so that the set-aside amount is not only based on the total contracts under the competitive threshold amount, but also on the

availability of micro-lebs as determined by the h.r.c. it would also provide a good faith outreach exception for architects and engineering professional services in general services contracts that are less than the minimum competitive amount as long as their subcontracting goals are met. and this is same as with construction contracts, right now, even if you meet subcontracting goals, you also have to demonstrate good faith efforts. this helps to simplify the contracting process for a smaller city projects while still preserving l.e.b. subcontractor participation. we will be making one technical change on this legislation. actually hasn't been scheduled for land use committee yet. so we still have potentially a few more changes occurring, so one of the technical changes that we will be adding is it would give the city's treasurer the ability to negotiate lines of credit for surety bonds and when we were working on the city attorney on this legislation,

they realized it might have been inadvertently left out during other work on the legislation. and then two items that are currently written into legislation that will require further discussion and you may see some amendments to that, as well, one is regarding the l.e.b. s.b.a. certification. so the city purchaser actually identified a problem where, in the application of the discount for commodities purchases, so we tried to make some changes to the legislation. however, we realized after the legislation was written, that was a little -- it reached a little further than we had intended so we might be amending it or striking it out completely from the legislation. the other change or the other item that might require further discussion is regarding subcontracting goals. the legislation would allow for subcontracting goals to be set by h.r.c. for professional services contracts and so

there's some discussion among, like, departments and h.r.c. as to how we should pursue this so again this part is subject to further discussion. and then in terms of chapter 21, it's mostly technical changes and cleanups and creates consistency between the legislation that was passed in february. so, for instance, one of the changes that we're doing is in terms of technology purchases, they are to be made through what is known as the technology store versus the computer store, so it's just to update the code to match our current process. it would also remove an outdated provision regarding the sealer of weights and measures, it would reinforce prohibitions against bid splitting, so that's something that's already not allowed, but this reinforces it in the code, and it also, in regards to prevailing wages, it consolidates and puts into the same section what the prevailing wage requirementsor so it's

easier for everyone to see what the requirements are without changes to the language for what prevailing wage requirements are. and one of the more significant changes in chapter 21 actually is in regards to the calculation of sales tax, discounts for commodities. it is the policy of the city to provide local businesses sales tax discounts for commodities but the formula was complicated, based upon the grows receipts tax and payroll tax system so the city, we're applying a 1.25% price adjustment to commodities bids to businesses located within san francisco to streamline it and make it easier, based on consultation with the city treasurer, controller, et cetera. that's pretty much, in a nutshell, what both pieces of legislation would be achieving and it's not yet calendared for land use committee but