the monthly maintenance. but it is significant for us or anyone, a quarter of a million dollars-plus, not to mention that the tremendous appeal that the home that is to the public. every week we get at least five people knocking on the down, wanting to take pictures of the home, giving us gifts and plants to plant in the yard from their yard. it was just overwhelming to us. we really never expected that at all. i spoke with mr. lilienthal this morning, and he is in support of this to maintain the heritage. the main thing is so that we can maintain the structure of the property in the future, and by this contract, we would be

able to do that. without it, we will not. thank you for your consideration. supervisor avalos: thank you very much. any other member of the public who would like to comment? seeing none come forward, we'll close public comment. colleagues, this item is before us. supervisor mirkarimi: first of all, thank you again, supervisor alioto-pier and to the property owners. i agree that this is an important landmark for the city and county of san francisco, and we thank those who want to continue to spotlight this property for all. in the same vein we had structured mill zach before, and i think the city is still

new at this since there have been only four properties. i propose we modify the property tax reduction so that it is -- and i am open to suggestions from colleagues -- the equivalent of the maintenance and care taking that we have more absolute figures on. i know that in other properties that had come before us, there were loans that were required to make those particular retrofits. i am certainly open to the idea of cushioning, if there are funds required that go beyond the maintenance and caretaking that are not captured in that. it would be helpful to have the assessor, but since we don't, maybe the budget analysis or controller can help us with what that looks like?

>> supervisors, through the chair, my understanding is that there is this estimated one-time cost of $253,000 to do the seismic retrofit to the foundation and then the ongoing estimated annual cost of $22,667 in perpetuity and for the life of the contract. we would have to go back and work with the assessor's office to actually calculate out -- my understanding is what you are trying to say is to try to make the tax break equal to what the cost of the maintenance and repairs are? is that correct? supervisor mirkarimi: that was the original thought point, but i am trying to be sensitive -- >> i cannot do that right at this moment. if it was continued, we could

come back. we would work with the assessor's office to come back and say what that number would be, but i can't do that right now. supervisor mirkarimi: all right. why don't we just make it easiest based on the number that is before us, and make it strictly beyond the $250,000, not that, and just the $22,000 and whatever the figure is from here on? so relative to the property tax reduction of future caretaking and maintenance. supervisor avalos: to me, that seems best. it seems to coincide with the contract and also with the nature of this building as well. the historic preservation commission has recommended this, but also, this is a

landmark, number 55. i think that is a special consideration that separates it from other buildings that are similar in san francisco. i do believe that -- and i think superelsbernd has talked to the city attorney about it, that we have to have some clear standards and how to apply the contract going 230rd. but in my mind, this building is an exception, and the structural work that needs to get done and with the ongoing maintenance costs, we can approve such a reduction. >> if i may ask a clarify question, when we work with the assessor's office, are you approve can't a $23,000 annual cap -- approving a $23,000 annual cap? i am not sure. >> may i jump in for a moment?

now it is my understanding that the gap of $22,000 a year versus the $31,000, that is the money that would pay for the seismic retrofit. that would pay for the $250,000 . supervisor elsbernd: so you are getting a loan, and you are going to have to pay off $9,000 a year to pay off the loan, is that correct? >> it won't take 35 years to pay off the loan.

supervisor avalos: supervisor elsbernd, this is why i had mentioned earlier -- supervisor mirkarimi: about either the twenty-two and change, or do we allot for potentially that initial infusion because of the payoff of the retrofit loan. i am trying to be open-minded about it, but i still think the $22,667 is the more finite number, but if we want to address what supervisor alioto-pier is saying to help cushion the 35-year payoff on this other loan, i would like to hear more from my colleagues. supervisor avalos: i feel more comfortable just approving not the entire $31,000, but the $22,000 range to cover the ongoing minutes costs. i do believe that the contact being enacted here is providing

a large benefit that i am willing to approve. but such a reduction, knowing that every property owner has to make maintenance on their buildings, it seems like it is part and parcel when it demeans their other than property. i am willing to go to $22,000, but we can see where we all stand as a committee on that. ideals elsbernd just curious. the $22,000 figure, when we see that is for maintenance of the property, is that for -- maybe this is a question for you, tara. is that the delta between what the maintenance of a regular home is and an arc direct really significant home, or is that something else?

>> i believe it is a bit of boast. historical buildings have a higher cost of upkeep. obviously they have to go through the historic preservation commission to get any of their permits, which is an added permitting and application cost. they have a higher standard in terms of replacement of materials. woodall, windows, all the detailing has to be replaced in kind. that usually requires hiring a special craftsman to replace anything. the maintenance plan talks about dealing with the woodall sheathing, mill work and ornaments, and inexpecting them and replacing them as necessary, dealing with the sheet metal, the roof. the roof was recently replaced, but they will continue to inspect that. the interior, this is also meant to help the interiors of the property, to help upgrade the electrical, plumbing and all of that. that is all part of their

maintenance. supervisor elsbernd: all right. and do we know when -- when was the property purchased? >> i will let the property owner speak to that. >> i am sam nakamura. the property was purchased in 2004. supervisor elsbernd: i'm sorry if this comes across wrong, but we are talking about a significant gift of taxpayer dollars. when you purchased the property, was the substructure issue disclosed to you? >> no. supervisor elsbernd: when you did your own inspection before you entered into the sale of the property, did you not discover that? >> no, because we didn't realize that the mortar was -- because a lot of it is behind interior walls. supervisor elsbernd: and when you purchased the property, you were aware it was a landmark?

>> yes. elsbernd yems and i assume you were a wear of the costs associated with maintaining a landmark piece of property? >> yes. supervisor elsbernd: ok, thank you. >> but the seismic retrofit is something that we had not considered. supervisor elsbernd: i understand that part. i'm fine with the chair's recommendation that the reduction down to the maintenance level, which was $22,000 -- supervisor avalos: $22,617. supervisor elsbernd: if we need to make a motion pertaining to that amendment. supervisor mirkarimi: i made that motion. supervisor avalos: that motion is there. and we can takes it without objection. >> cloo i clarify that that -- could i clarify that that number is the amount of the

reduction or the amount of the contract? supervisor avalos: the actual property tax. >> because the way it is worded now is the amount of the contract is the $10,6 2. 692. you are changing the savings, the reduction >> you are changing the amount of the actual contract? supervisor elsbernd: i think you understand what we are trying to do. rather than seefing the $31,benefit. supervisor mirkarimi: the $22,000. supervisor elsbernd: we will let you figure out what needs to be done on that end, but that is the motion. supervisor mirkarimi: $22,based

on your record. supervisor avalos: moved forward to the full board with recommendation. mr. young, next item? >> resolution regarding greater union square business imcombrookt district, receiving and approving the annual report for fiscal year 2009-2010, modifying management according to the annual report. changes in the management district plan. supervisor avalos: welcome. >> lisa pagan. office of work force development. good afternoon. today in front of you for your consideration is a resolution regarding the union square improvement district, to

receive and approve their annual district report for the 2009-2010 fiscal year, and also to review their proposed changes to the management plan. i would like my co-presenter, the director of the greater union square business improvement district to introduce herself. i am going to review the annual report, the fiscal review that our department did, and then she is going to go over the services and pimlicoments of the district in the past year. linda, if you want to introduce yourself? >> forward, linda magellon, unit square business improvement district. >> all business improvement districts are governed by state law, local law, article 15, and a contract with the city that the office of economic developmentover sees as well as a management plan approved by

the board of supervisors and was approved in 2009. our office, the office of economic work force development, we are charged with ensuring all bids are meeting city contract requirements, and we are charged with conducting an annual review of each business improvement scrict, and we provide the board of supervisors with a performance report and financial analysis. this resolution covers the annual report that the union square business improvement district submitted for the 2009-2010 fiscal year. we row viewed their annual report as well as their c.p.a. awed. the resolution includes changes to the management plan. again, linda will present some of that to us, as well as the services. so the bid was established originally in 1999 with around 10 clocks. it was renewed in 2004 and again in 2009.

it was expanded in july of 2009 to cover 27 blocks in the grare -- greater union square area. there are 593 physical parcels and one time share building that has over 2,000 owners, time share owners. so a total of 2,882 parcels that are assessed in the district. their annual budget is about $3.6 million. they provide clean and safe services, marketing advocacy, beautification of streets, they manage the district and oversee all these programs. the controller's office and our office, we reviewed their financial reports and their audit, and their union square bid is fully in compliance with

their requirements from the city in their contract. the budget for each service category, one of the things we look at is was it within 10 percentage points from the manning plan's bgget. yes, they stayed within 10 percentage points of the management plan budget. the union square has requirements to get other funds. they have fundraised more than what they are required in their contract and management plan. almost 8% of their income is from income besides assessments. that includes $221,000 in grants. their budget versus their actual expenses, they spent less than budgeted for all service categories, and that was because the assessment is from july 1st to june 30 every year, but they did not start services until january 1st. so what they do is they carry

over funds to cover the first six months of each fiscal year because the city does not pay until january. from july 1st until december, the need to carry over funds from the previous year. this totals 1,520,000 and that is spent in fiscal 2010-2011. the proposed budget is $3,608,000 and a half its revenue projection of 4,618,000.

the summary of the proposed plan, this is updated and put in more specificity. they clarify and the assessment methodology someone determined after they received assessment of bills. they made changes to the plan and to the assessment roll. they are proposing to expand their board of directors from 11 to 23 members.

>> thank you very much for hearing us today. in order for us to get on with an election, it is very helpful that you are hearing us today. we have been given an overview of our and the report, the audit, and this year's budget. she did indicate that the

district was expanded and a map is before you here. our organization is a membership organization what is unique about that is that when there is a matter that requires a vote of the members, we have to send 10 ballots out to those nearly 3000 members. many of them are timeshare owners in the district. every month, we collect data on the services that are provided. the service provider provides a daily activity report. for the first six months of this fiscal year, we steam cleaned

nearly 92 miles of sidewalks, but we removed nearly 1000 graffiti tax, we dropped off more than 500 trash receptacles. we did some major cleanup and i think that that is an example of the impact which is on -- alley. i don't know if anyone had seen this but it was shameful. we are now proud of it and we plan to continue using it. >> where is this? >> this is between johnston and grant and the east-west blocks. this is right in the heart of the district. this was really awful.

in fact there was a restaurant there and they quit because they were so tired of trying to deal with the mass. it is unfortunate because they were a great restaurant. our services also includes the ambassadors who are always a friendly face to the visitors coming into the area. they helped more than 15,000 visitors during the six months giving directions, providing maps, making the recommendations. they also assisted more than 4300 people that were in need of help. also providing a great service to the area.

i am sure you have heard stories. heyman names rafael cleans up around here. i see a man scraping graffiti off of the sidewalk. the parking meters, the walls. always with a big smile. this is a great program. thank you. i think that we are fortunate to be served by mgm management group. they are a service provider and that permit goes hand in glove with the kind of service that we receive from and jam -- mjm.

we spend about 65% of our budget on clean and safe. one man's curve -- stabbed another in the neck in an incident that was reported. the individual was put in an ambulance. the ambassador identified the individual who did this and it turned out that he was on parole. this is a really good example on

how this program comes into play when it is needed. part of the budget is for streetscape improvements. we have an advisory committee that works on these matters. one of the projects that we are proud of his a very extensive -- project. we will extend the sidewalks temporarily, both sides between ellis and geary. this is a rendering that shows what we are looking at.

we are actually reconsidering the construction of the extended sidewalk and are thinking that we might go with concrete pavers in aggregate and they would still be moveable. we have had great support from the businesses along those two blocks. this shows how the configuration would be and seeing supported by the members on those two blocks. we have approved a new logo and we will be unavailing that at a holiday party on december 2nd. -- we will be releasing that at a holiday party on december 2nd. we sponsored a number of public events at union square and the

holiday plaza. some of them are an annual celebrity crab cracking contest. we have had supervisor chu as one of the contestants. we have used this as a fund- raiser for the forty-niners foundation. we have theater in the square along with the management company and san francisco jazz concert on thursday night during the summer. 2% of our budget is allocated for all of the plaza. we're able to do that with a grant from the city for the specific purpose of making improvements and sponsoring programs. on oct. the seventh, we put on some really great performances. i think that there must have

been at least 20 different groups and i will just lay out some pictures so you can see the different kinds of activities that took place. we had marriott to dance, ballet, puppeteers. -- we had mariachi bands. the people who came and watched were thrilled by what they saw. one individual put this posting about that evening, it was on a blog called "a beast in the jungle," and he said that he happened upon a performance at holiday plaza and he describes the tenderloin has a bright and