opportunity -- but i also believe there are people who cannot be rehabilitated. i do not believe that the district attorney's office can do so without the help of the public defender's office. i consider this a wonderful opportunity. i really look forward to it going forward. in closing, i want to say, again, that i am taken aback by this awesome honor that has been given to me. i pledge to you that we will do everything that we can to make sure that i earned the right to be in this office. thank you so much. [applause] [applause] mayor newsom: to out treasurer, thank you.

our new acting police chief in san francisco will be serving in that capacity until the police commission will be quickly forwarding to the new mayor recommendations for a permanent selection. that process is, i assure you, already under way. thank you very much for being thank you very much for being with us.

>> welcome to the budget and finance committee. are there any announcements? >> please turn off all cellphone and pagers. if you present any documentation, please provide a copy to the clerk. items acted upon today will appear on the supervisors agenda unless otherwise stated. >> given that the two items are related, will you call item one and two. >> resolution authorizing the license of space and services for unitedlayer at 200 paul

street. item number two, resolution authorizing the license of space and services with telx paul street for the department of technology. >> let's go first to the department of technology. >> this will be a very brief presentation because i believe you have read the report. we would like to touch on some high points. >> can you please talking to the microphone? >> we are wanting to have a dialogue about this afterwards. a bit of background, the original department of technology establishment was at

one market paused after the earthquake which damaged city hall plaza and the need to retrofit city hall. this used to be in the basement of city hall. this is not really a classic datacenter. there was a need to relocate. we found the place said one market plaza to relocate the infrastructure. the downside of that was that it was not a classic design for that purpose. it was retrofitted to house equipment as soon as possible. it was not envisioned as a long- term solution to the needs of the city. over time, we have continued to pay her rent her there, however, the infrastructure at that facility has continued to

deteriorate and we have never had a front to replace or improve the infrastructure. there has been numerous reports done. the estimates to improve the facility are anywhere from a million dollars and upwards to $17 million depending upon the types of repairs and level of compliance to the standings would like to add cheese. we have decided to relocate the datacenter. there are efforts to move this through the procurement process and we have been asked a lot of times why is this necessary. this is an expensive proposition. on we have tried to quantify and why this is important to the city.

there is a lot of discussion about the organization, how you quantify the cost of the down time. if a computer fails or if the network is unavailable, what does that mean to the organization? because we are a nonprofit organization, we are challenged on how we want to do that. what we have tried to do is give you a couple of examples. this is the main. it is not a job that we take lightly. we process a lot of information through our printing services.

and we have tried to quantify what it would mean in terms of down time if we were not able to process those checks. to give you an idea of the magnitude of the work that goes on in that center, we are wondering what it means for the people in the city when they cannot house this. >> you have the network operations of the city that can run as good a center as we can reasonably afford. what we did in 2008 is that we issued a bid for services to relocate our equipment to find new space in the city. the site was located through the competitive bid process. what we are bringing is the

initial agreement for professional services to both relocate and configure and network and get a space in the space. now that we're done with this, this is more of a realistic agreement and in the online space that is managed their turn to what we are bringing for you is one agreement where the equipment would be located and the other smaller agreement is really related to the connectivity to connect that centered out to the rest of the world and out to to the rest of the sitting at work. finally, we have been asked what does this mean in terms of the city. but as you are aware, we are one department out of money that has technology systems. the department of technology represents somewhere between a quarter of 30% of the total

investment we have in the city. in parallel to the department of technology to better manage services and the network, we have been leading a parallel effort to look at data centers citywide have. what has happened is many of the larger departments and medium- sized apartments have tried to create their own data centers which creates a redundancy to house and equipment for the air- conditioning units, for the generator units. we're looking to consolidate data centers citywide. we have analyzed all of the city-owned facilities through the internal process whereby the members had input into this

process, we have decided to consolidate where servers are house around the city. one location would be at the airport. we are just kicking off a new space which could be shared by the city. this is about half of the capacity that we need. the other is where we establish additional space to start to relocate to other servers that are currently underutilized or expensive space around the city and moved them to a consolidated space. in this lease is consistent and in line with expectations from long-term savings and how to consolidate and bring these systems and operations to the

locations. but as my final slide. or will welcome any questions. >> thank you. why don't go to the budget analyst and the report there? >> i point out on the report is that the proposed legislation, the department of technology has issued a request for qualifications and that is in the computer store and that is to contain project management services for this specific relocation. incidently, supervisors, as you know the department has been leasing space at one market losses since 1993.

on top of page 6 of our report, we point out that the resulting agreement between the department of technology was not subject to the board of supervisors approval. this agreement was considered to be a service agreement as opposed to a licensed release of the facility. in other words, this is the contractor who placed the department technology from one market plaza to 200 paul street. it was a service agreement not a lease although it resulted in this license of the facilities

at 200 paul street. although the board of supervisors did not specifically approved the agreement, the budget and finance committee was involved in the decision to relocate a city datacenter because on march 18th of 2009, the budget and finance committee approved the release of the reserve to allow the department of serology to purchase new networking equipment which was to be incorporated into the move. you should know that the move has essentially taken place. the department is in the new

facility. due to the nature of relocating the city's equipment, there has been a delay. it was initially anticipated that it would be completed by january 31st but it is now taking another month or through the month of february. on page 10 of our report, under the fiscal impact section, we stated that the department of technology is paying $91,000 to lease the facility. . if you look at the table on page 11, we state under that

table the total monthly cost would increase by $70,380 per month or 7.1%. the total annual increase cost is $844,696. however, a direct comparison of the cost does not reflect the fact that this is a superior data facility to one market plaza. it has upgraded capacities.

the cost of at least close to a million $900,000 would be needed to upgraded into a facility and to continue the datacenter and the department of technology has stated that seismic and power capacity upgrades would be cost prohibitive although no data was provided to us and that connection. as i indicated, the department technology completed the anticipation on january 21st, so you have a situation where they're paying both the $90,000 for one market plaza plus an additional --

we cannot verify the need for additional capacity. this was going from the wire connections to the 24 wired connections we have been looking at. would point out that the cost differential is not significant. there is only about $1,100 per month. our recommendations are on the bottom of page 12 and on the top of page 13. we say because of this significant increase, 77.1%. the budget analyst considers this to be a matter for the board. we also say this is a policy because of the wired connections but i would minimize that point and the standpoint of the cross increases which is not significant. due to the high cost increase

and the potential for cost reductions over time and the consolidated locations such as the airport, which is a facility that is currently being prepared. we recommend that you amend the proposed legislation to require that the department of technology provides reports every six months on progress made towards consolidation to these facilities and equipment and staff. let me mentione that legislation was presented for the consolidation of the computer operations. this particular legislation before you is not consolidation

this is an increase in rent for the stated purpose that they need this new better facility at 200 paul street and i would be happy to respond to any questions. >> i do have a number of questions. one of the things that was mentioned was that the change was not a very significant change and we talk about the redundancy which would be crated for moving to market plaza. can you explain about the difference that we would truly be getting. there was not any mention about what the seismic capacity would be. >> to compare the two facilities, the one market plaza

facility was built from a structural standpoint which is one of the thing to take into consideration. it was built around 1974. this is in a liquefaction sound -- zone. this is considered a high-risk zone. this is considered a high-risk zone. the 200 paul facility was pressure fitted in 1997. it happened between 1974 and 1977 to make it closer for the earthquake safety standards.

it would not be considered it tier one. this would be a teacher and zero facility. -- this would be a tier zero. there was the rankings to judge the impact to the operations. these are up to as much as 80 hours of downtime in the year and eighth tier 1 or less facility. in a tier 2 facility, it would be less.

tier 2 is only 20 hours a year. we feel like the 200 call facility in terms of risks as a down time due to this facility failures such as generator failures, things like that. we would like to and not expose the city and -- to the risks of down time. >> thank you for the explanation. it sounds like this is one of the components that is not captured and this is really the seismic issue and you have explained that. with regards to a facility, maybe the comptroller's office can speak to this. another was that was done previously that considered and

contemplated whether it was better for the city to go and purchase a building that we could locate in long-term verses potentially renting out a facility like this. can you or the comptroller's office provide a background on that finding and what would be considered when the recommendations were put forward? >> in 2009 there had been when the pardon was coming before the budget and finance committee to get the release of the reserve for the relocation of the datacenter from one market to 200 paul, the initial plan at the time was to rent the site for an interim time while the city secured and renovated the city-owned site for a data center.

there was some concerns that we had because of the costs associated and the inability for us to finance such a construction project. the office of public financing and the comptroller's office did do an analysis to try to compare the renovation potential to petite paul street site towards the future: site. we estimated that the cost for one market was in excess of $17 million. the policy -- the paul site was estimated at $1 million. the future on side was estimated to be 11.8 million. this took into account the tenant improvements and the mechanical, electrical, computer equipment, insulation moving costs. it was clear to us as we amortized the costs that it was

more cost-effective for the city to actually luis the site and in fact consolidate many of the other servers that might be located throughout the city and so with that recommendation, the staff did a study in a survey of all of the equipment in the city and there was a policy decision made that has been confirmed and number of times in the past that the city should begin consolidating their infrastructure. this is that one of two sites, either the paul street site or the airport site. >> thank you. i think there is a follow up question. >> i understand that it was $1 million but this is over the course of one year. what is the cost over the long term?

>> what we look at was a 20-year horizon for the analysis and for the one market plaza, that is also a leased facility. the cost or estimated at $52 million. for the paul street site, the estimated costs was $43.7 million. obviously, the future-owned site, the assumption there was that over time that would be the least expensive, the $28 million. we would have needed to invest in the infrastructure and construction. >> that was roughly 11 million come like that was $28.1 million.

this is assuming that financing would have been $28.1 million. >> thank you. >> just a follow question, the alternatives that you evaluated was that if we stayed at our one market plaza location, in order to receive the safety level as well as the improvements that we were talking about, they would have had to invest about $70 million to make that site comparable to the limited improvements which would be included at 200 paul street? >> i don't think it was an option for the city. the landlord had one of the city out there for a lot of years. when the recession hit a couple of years ago, some of the pressure was removed. i recall back seven or 8 years

ago going with the department to look at the facilities and what the potential costs might be to the data center so that this has really been on the planning for many many years to move out of the plaza because of inadequate space and keeping the city as a tenant. >> if we were to abstain, hypothetically, even if the landlord had agreed, it would be a $17 million investment into a private facility. >> that's correct. >> getting at of the lease after three years, i think it's ideal for the city, should there be movement in the future, but why

is it that we cannot go down the path now in terms of getting a facility that is city owned. could this have been made? what was some of the thinking there? >> in the yearlong study we have done, that work group that we work with did steady 11 different city-owned facilities in terms of evaluating them for retrofit potential. that compared this to the initial investment they would take in any other city-owned facility to locating things in 200 paul and still this came up as the best solution