supervisor avalos: good morning. welcome to the budget and finance committee. my name is john avalos, the chair of the committee for the day. to my right is supervisor sean elsbernd. this is my last time chairing the budget committee this year. maybe it will happen again. i'm going to make this last as long as possible. ok.

the clerk of the committee is victor young. do you have any announcements? >> please turn off all cell phones and pagers. please provide a speaker card to me if you wish to speak. items appearing today will be on the agenda of january 25 unless otherwise stated. supervisor avalos: thank you. please call item one. >> resolution approving three bicycle facility program grant agreements with the bay area air quality management district with contract terms of more than 10 years. supervisor avalos: do we have a presentation from anyone from the city? >> sfmta. the reason we are here is we are requesting approval of three bicycle facility contracts,

funding that we receive from the bay area quality management district. the bay area quality management district requires that their contract term -- the useful life of the facilities that we are constructing, plus three years. in this case, bike lanes we are constructing on the great highway have a useful life of 10 years. then we add three years to that, for a total of 13 years. that is the reason we are here, requesting the board's approval of these agreements. supervisor avalos: thank you.

is this the first major round of bike racks we are putting in? the first grant we have had for that? >> let me refer to my colleague who is better qualified to answer that. >> the answer to your question is no. we have other services that provide racks. this is just one funding source. supervisor avalos: ok. thank you for the presentation. is there anyone from the public that would like to comment on this item? seeing none, public comment is closed. we will move this forward with recommendations. item two. >> resolution authorizing the department of the environment to retroactively accept and expend a grant in the amount of $75,463 from the us environmental protection agency to implement a green cleaning pilot project that will lead to

the creation of multi-lingual green cleaning guidelines. >> good morning supervisors. department of the environment. the title explains what this is, a $75,000 grant to cover staff to develop guidelines and develop more bilingual materials. supervisor avalos: great. thank you. any public comment? seeing none, public comment is closed. let's move forward with recommendations. my time as budget chair is slipping away rapidly. item three. >> resolution (1) approving and authorizing an agreement for the purchase of a permanent access road easement totaling 2.16 acres over portions of assessor's parcel numbers 016- 002-017, 016-002-018 and 016- 002-44 located in stanislaus county, required for the san joaquin pipeline system project no. cuw37301 for a purchase price of $13,000; (2) adopting

findings under the california environmental quality act; (3) adopting findings that the conveyance is consistent with the city's general plan and eight priority policies of city planning code section 101.1; and (4) authorizing the director of property to execute documents, make certain modifications and take certain actions in furtherance of this resolution. >> i am here on behalf of the division. before you is a resolution to approve a permanent access road easement in stanislaus county. this is required to access an existing pipeline for repairs and maintenance. the purchase price for the easement is $13,000. supervisor avalos: thank you. public comment? seeing none, public comment is closed. motion to move forward with recommendations. item four. >> resolution authorizing the master lease of the hotel le nain at 730 eddy street for the department of public health. >> before do is a proposed 10-

year lease between the city on behalf of the department of public health for direct access housing program to lease the hotel le nain. this would provide affordable housing to extremely low income residents. the monthly rent is 54,000 $744,000. annual, five under 66,009 $28. there was no increase at the time but when the lease goes in effect, they will be cpi. the landlord is responsible for retain an extraordinary means every year, limiting -- the city's obligation is limited to $5,000. the proposed lease has the recommendation of the budget analysts office. supervisor avalos: 54 the presentation. mr. rose? >> mr. chairman, supervisor elsbernd, i would simply point

out, on table two, page 5 of the report, the cost per unit annual rent per unit for the 86 units is about $7688 per year, and that is more than average of other hotels. however, as we point out, there are more amenities for this hotel, such as a full bath, so therefore, that increased cost appears to be justified. we recommend that you approve this resolution. supervisor avalos: very good. public comment? >> good morning, supervisors. thomas pickering low. i will give some public comment to extend your longevity as chair of the committee. i have some problems with this

item on the agenda. first of all, there was no request for a proposal by the department of public health to ascertain whether or not dph could get cheaper rental space for sro tenants or get better habitable space for tenants. i would urge you to request the department of public health, when they seek space for sro tenants, that there be a request for proposal, not a contract to a nonprofit named dish. as you can see, as indicated to the gentleman to the right of me, these units are 8% higher.

it is true this sro has a bathroom facility for each tenant, but others also have a bathroom. finally, i would say this. you are requesting that the tenant pays 50% of their income for their space. so any cost will be passed on to the tenants. that is probably not a good idea either. i urge you, when you give out contracts through dph, that you mandate at a minimum they have a request for proposal. supervisor avalos: thank you. seeing none, public comment is closed.

-- is there anyone from the public that would like to comment on this item? seeing none, public comment is closed. forward with recommendations. item five please. >> ordinance authorizing the mayor's office to reward john doe $10,000 for providing information that led to the arrest of a criminal defendant. supervisor avalos: any public comment on this item? seeing none, public comment is closed. motion to move forward with recommendations. without objection. item six. >> resolution approving the professional services agreement, airport contract 9015.1 master architect for replacement air traffic control tower/terminal 1 complex redevelopment program between howard, needles, tammen & bergendoff, and the city and county of san francisco, acting by and through its airport commission, in the lump sum amount of $11,704,955, and a contingency

budget of $1,626,412 for airport and faa requested changes, pursuant to san francisco charter section 9.118(b). supervisor avalos: let's call items 7 and 8 as well. all the airport items. >> item 7. resolution approving the international terminal museum/gallery store lease between san francisco museum of modern art and the city and county of san francisco, acting by and through its airport commission. item eight. ordinance establishing a special fund to receive donations and authorizing expenditures for the purpose of holding events to promote the opening of the newly renovated terminal 2 of the san francisco international airport; and deleting obsolete provisions. supervisor avalos: ms. widener, welcome. >> thank you. kathy widener with e san francisco international airport.

i will start with item six which is seeking your approval for a professional services agreement howard, needles, tammen & bergendoff. the contract is to provide master architect services for the replacement of the airport's air traffic control tower and terminal 1 complex redevelopment program. the full board has approved a number of items related to the tower, including our other transaction agreement with the federal government which allows us to be reimbursed for the tower cost, as well as fiscal feasibility items on the tower. this item is before you because of the contract and when we believe will be in excess of $10 million. as the title suggests, it is to provide master architect services for the tower as well as terminal one. the tower will sit in a courtyard between terminal two and terminal 1, integrated portions of terminal two that will be impacted. the tower project is 100%

reimbursable from the federal government, but portions from the term of one project will be the responsibility of the airport. that is included in the budget. the contract is the result of a competitive rfp process with howard, needles, tammen & bergendoff scoring the highest. the budget analyst has recommended approval. supervisor avalos: mr. rose, if you want to comment on item six. >> as our report points out, although this was a competitive proposal, it was not based on cost. however, we concur with the department, because this was a professional services contract, it was based on experience and qualifications. there is also, as the engine, a

contingency amount of 13.9%, about $1.6 million. that is how we get to the $13 million, plus the contingency. we also point out this is for a term of according to the agreement for up to 10 years. this specific agreement is for a term of 1095 days, approximately three years. finally, regarding the cost, when the airport submitted this in the rfp, they estimated the cost would be $9 million. it turns out, excluding contingencies, it is about $11.7 million. we asked for an explanation and we have an attachment to our report, beginning on page 6, which explains -- the bottom

line is the airport underestimated the scope of this project. that is why there was an additional $2.7 million. however, given the fact that i mentioned cost was not considered, it does not way into the overall evaluation of who was the winning proposal. therefore, our recommendation on page five is to ame the resolution to specify that the term of the agreement is for 1095 days, instead of approximately 10 years -- not to exceed 10 years -- and that you approve the resolution as amended. supervisor avalos: thank you. let's move on to item seven. >> item 7 is a new 10-year lease agreement with the san francisco museum of modern art for 2282 square feet of retail

space in the international terminal. sfmoma is the current operator of this space. they have held the lease since 2001. the original term expired in 2006, but as you may remember, many of the retail and food and beverage services were extended as part of our program after 9/11, which allowed this police and others a onetime five-year extension. the proposed lease is a result of a competitive rfp process where sfmoma was the only proposal. a panel evaluated the proposal and found to be responsive and responsible. according to airport concession revenues that, there was targeted outreach to many different museums in san francisco to try to get more

than one proposal, but given the economic reality of retail sales, we only received one proposal from san francisco moma. the new lease carries a percentage either based on gross revenue sales or a minimum annual guaranteed. in this case, the minimum annual guarantee is 1200 $500 -- $12,500. the existing mac for the lease is $175,000 has proposed to the proposed lease for $125,000. airport staff believes the $125,000 is fair market rent for the space, and is realistic based on the sales we have seen there in the past few years. the budget analyst recommends approval. i would be happy to answer any

questions. supervisor avalos: mr. rose. >> as ms. widener points out, the minimum annual guarantee would go down $50,000, but there was only one proposal don. however, i do have a question on this. my understanding -- and it would not change my recommendation -- was that competition was based on the minimum annual guaranteed and it was the percentage rent that was set by the airport. if the committee wants to just confirm that, that might add to the discussion. we also point out, that under the agreement, the airport estimates they will see a percentage rent. that is $131,000, which would

be $6,000 more than the minimum and no guarantee of $125,000. we recommend you approve this resolution. supervisor avalos: thank you. on his question about the rfp process? >> it is my understanding the rfp contained language similar to other retail leases that have come to you it's to youa mag, as well as a percentage growth revenue and that the rate is greater than either. mr. rose is correct that based on sales, sfmoma will be paying their percentage rent paying theirtheir mag. item a8 is an ordinance that

would amend the city code to delete a previous code established by the airport around the promotions around the new international terminal and replace it with a new promotional fund for events and promotions around the opening of our terminal 2. the establishment of a special fund by department is allowed by city administered the code section 10.100-10 and gives the airport a mechanism to collect private donations and spending from the account consistent with the specified purposes of the account. it also allows us to carry forward any unexpected or -- an expanded balances at the end of the fiscal year. the t2 promotional fund will be used to promote marketing activities related to the spring opening of the terminal. the airport has a fund-raising goal of approximately $600,000 from private donations.

i believe we will also spend $400,000 of airport revenue as part of the current marketing communications budget. as stated in the ordinance, the airport will submit to the board of supervisors and budget analyst a written report of revenues andexpenditures from the fund on a bimonthly basis until the fund expires at the end of december 2011. i am happy to answer any questions. supervisor avalos: mr. rose. >> as stated, there is an estimate of about $600,000 in private donations. actually, they have commitments of $430,000. those commitments for each individual entity is shown on page five of the report in attachment one. together with the estimate of $600,000, the money that the

board of supervisors have previously approved for activities, a total of $980,000 that would be expanded -- expended. we recommend you approve the ordinance. supervisor avalos: thank you, mr. rose. let's open up these three items to public comment. items six through eight. >> good luck with the airport photographed i realize this is your last meeting here today i want to thank you for all your work and have you tried so hard every day i hope we are looking better in the budget i would like to have a budget to hold as the years go by

and we grow old today thank you. supervisor avalos: thank you. i have never been serenaded before. is there anyone from the public that would like to comment on this item? seeing none, public comment is closed. motion to make the amendments on item 6 to make the maximum length of time 1095 days. the other two we will move forward witho recommendations. >> you also recommend as amended item six. supervisor avalos: thank you. item nine. >> resolution authorizing the department of public works to accept and expend $11,553,000 in federal surface transportation program and/or congestion mitigation and air quality improvement funds awarded through the metropolitan transportation commission's congestion management agency block grant program.

supervisor avalos: good morning. >> good morning, supervisors. this is a resolution for except /expend for four projects. these projects were awarded the $11.5 million last june. it was surface transportation programs and or congestion mitigation air quality improvement funds. this is going through the congestion management agency block grant program. in september, the board of supervisors approved a resolution for these projects. the four projects are folsom st., bage, 2nd street streetscape, broadway streetscape face three -- phase 3, and ,marina bike trails.

supervisor avalos: thank you. is there anyone from the public that would like to comment on this item? >> i sure hope you do not run out of money for this item right now i know you were brought before but i hope you have some i hope you are not out of love and money and do not get lost without you i know you were late with a payment before i hope you have money for this clean air item i hope you can do that today supervisor avalos: thank you. we will close public comment. move forward with recommendations.