supervisors ammiano and david chiu for demanding improvements for dt. from my 20-year experience at san francisco general hospital, the technology part of my job was pretty much in the dinosaur era. a lot of my friends in the police department have wore me out listening to their complaints about their lack of technology in the police field. i hear it is improving recently. in regards to serving the community, for using this money, since it is in the millions of dollars, i would like to make a controversial suggestion and see where it goes from here. according to my work experience at san francisco general hospital, it is a sad commentary that much of the time he used by city employees using city in -- computers has been

underutilized. one of the things that i would like to point out, which many consider a taboo subject, is how much pornography actually flows through the city's various computers during the workday. i have a suspicion the comptroller's office has some information in regards to that, but i do not know for sure. i think it is proper to maybe do an investigation using this grant money, to see how much actual pornography flows through the city's best computer system during the workday. my main interest is not only on pornography, but also to highlight the federal law enforcement efforts on the very sensitive subject of child pornography. thank you. supervisor chu: thank you. is there anyone from the public that would like to comment on this item? seeing none, public comment is closed.

ok, the item is in and of the committee. do we have a motion? motion to send the item forward with recommendations. without objection. item to police. >> ordinance amending chapter 10 of the san francisco administrative code by amending sections 10.177-2 and 10.177-3 authorizing the assessor to recommend rewards for information related to the detection of underpayment of tax owed to the city and county of san francisco. >> our assessor phil ting is with us today. why don't i invite david chiu to speak. he is a sponsor of the legislation. >> thank you. this legislation we have in front of us is the reauthorization of the real state watchdog program which came of conversations i had in 2006, before i was elected to office with the assessor recorder, who is here today. we had been hearing reports

about the underpayment of property taxes and had discussed the possibility of creating this watchdog program to consent individuals who might hear about this underpayment to report information to his office. i am very pleased, both that we were able to move forward in 2006 with this program, as well as results we have had today, which our assessor will educate us on. at the end of the day, this is a program that has worked, has been successful, is a great partnership between the public and the public sector. i want to thank assessor quarter phil ting for the work he has done to implement this concept. i hope to move this through the board again for reauthorization shortly. supervisor chu: thank you. mr. ting? >> you are right. supervisor david chiu is being modest. it is actually his idea,

modeling our program after the irs watchdog model out there. it really empower citizens to help the city do a better job of collecting property taxes that were not known to us. we have had, over the last five years, 66 reported incidents. most have been ruled out, -- 62 -- because we had knowledge of the transactions in office. however, we had two cases, one, a fairly on in the program's early history, that brought in over a million dollars in back taxes. that does not even account for the future taxes after the reassessment. so you are looking at a program with just the rich -- two reports that have brought in over $1 million of back taxes. this should also be noted. no additional city staff was hired. staffing was absorbed by my office and the comptroller's office. we have a couple of

modifications. the program has been running for five years. we want to reduce the report. we want to make it 10% of the reward. 10% of the taxes that were actually brought in, up to $100,000, which lowers the cap from five under thousand dollars. we feel $100,000 is plenty of money to justify an award. -- the cap from $500,000. we also want to define what a whistleblower is from a real- estate watchdog. 311 has graciously accepted to be the intake of that. they will be able to give us that information, which is traditionally what the comptroller's office had done. lastly, our office has the responsibility to do an annual port to you six months after every fiscal year, so that we can have an opportunity for you all to understand what has been

reported, why it was given a reward, properties known to us. there was a report. the most recent was dated january 1, 2011, which summarized eight cases, all of which were ineligible -- the primaries and was just the information was known to our office. at this point, we would be happy to take questions on the program. supervisor chu: thank you. let's go to the budget analyst report before we go to questions. >> madam chair, members of the committee, president chiu, as has been indicated on two-five of the report, the city has realized $1.7 million in additional property tax revenues. this is during the existing five-year pilot program. wonder what was paid out in the amount of $66,600.

this program is being administered with existing resources, so there are no additional costs for administering the program. we recommend approval of the ordinance. i do not know if it was noted that the maximum reward amount would be reduced from 500,000 to 100,000. everyone has concurred on that. >supervisor chu: i have two questions on the program. in the report, it indicates out of the 62 referrals we received, 60 were eligible, primarily because the assessor's office already had the information. in those situations, the individuals did not meet the criteria to receive a reward. in terms of your staff time to process and check up on the 60 ineligible referrals, did you find that that was a duplication

of work because you knew about them, they were already being assessed correctly, but you have to follow up on these additional 60 referral that you knew about? how do you judge that? >> if you think about 60 referrals over five years, it is a fairly minimal amount of work. it is -- part of the reason i like it, it is like quality control for our budget office. it gives us an opportunity to double check and make sure we are working on a particular item. the amount of time -- certainly minimal. the most time it would take is two hours. in most circumstances, half an hour's time. even though that information was already in our office, it is a good opportunity to provide some quality control to make sure that we are doing our job. supervisor chu: on the background, i know mr. rose had reported that with real estate

transfers -- in particular for president properties -- we know about the property easier because the deed needs to be reported. a clearer transactional period and we are flat that there should be a reassessment. with the transfer of commercial properties, it is not always as clean, clear, i suppose. have you thought if there is any way this could be legislatively fixed? is there any improvement that we can make on what is required to be reported during commercial transactions, or is it just the nature of the deed? >> the one big quagmire, a proposition 13, is that it changed our work from being purely about the value of real- estate to figure out when a change of ownership occurred. after proposition 13, the state legislature had the duty of defining what specifically is the change of ownership. you are right. while it is clear in most

residential circumstances, it sometimes can be convoluted, at best, for commercial property owners. so the state legislator has tinkered with numerous definitions. we, as assessors, have constantly conveyed ways where we can get these more streamlined. unfortunately, it is purely under the state assembly per view, and it is a constant fight, i will be honest, at the state legislative level. mr. ammiano is pushing for legislation on that, and we are supportive of that, but it is a continuous struggle. in the long run, certain members of the legislature see it as a way to increase taxes. supervisor chu: if there are any ideas, any improvements that we can make locally, that will help. that will be something we would all be interested in. it is something that would more

clearly denote when a reassessment should occur. that would be helpful for us. >> one thing that we have to rely on, a lot of corporate transactions happened, as you mention, without eighth being recorded. the only way that a county assessor with no a transaction occurred is if a deed was filed. what we end up relying on is information from corporation tax returns. that information then goes to the state board of equalization, which is then circulated to all assessor's up and down the state. that is called a legal entity ownership program. we have been working much more closely with the board to get that information. unfortunately, even that information may take a year or two. you do not file your taxes until april of that calendar year. something may have happened in january 2010 and they are going to file in april 2011, and we

may not get that information for another six months to a year. unfortunately, that is part of the system that we, as state voters, created. it would be much easier if we look at the value of real estate. about who owns it. i have worked very closely with the state board to have more collaboration and make sure we are working on that. the other thing that effects locally is when transactions occur, they don't transfer taxes. with transfer taxes, we have been more aggressive. once we know on the assessors' side, a transaction has occurred, doesn't mean they have to pay transfer taxes. we have been more aggressive about demanding payment of transfer taxes once we know it has occurred as well. supervisor mirkarimi: is there a

statute of limitations on the infraction or violation? >> for us, the watchdog. in general, we have a four-year statute of limitations to process -- if the information was never provided to us or was hidden from us, we do not have a statute of limitations. in this example, the one watchdog case we had, the statute of limitations had already passed. we have to go all the laid-back to get all of the back taxes, not just the four-year limit. that information was hidden from us. supervisor mirkarimi: how far back would be some of the examples? i imagine most of them would be between three and five years. but they go back farther than that? >> my recollection is that information came to us in 2006

and the transaction occurred in 1998, approximately. what was ironic about that case is it was a real estate investment trust which is a publicly traded company on the new york stock exchange. if you pulled their 10k, they reported it to they stock exchange but they never reported it to the assessor's office. supervisor mirkarimi: if the assessor's office would not be doing this, would this also be considered part of the district attorney's purview and the white collar crime bureau? >> i'm not really sure. i guess it could be. supervisor mirkarimi: thank you. supervisor chu: why don't we open this item up for public comment? are there members of the public who wish to comment on this item?

>> hello, i am deborah benedict, a voter in district 6. i want to thank chairman chu bandmaster chiu. bringing home the bacon is such an important job for this committee as well as for the city. hidden transactions, especially of commercial property provide an opportunity for the city to fill in gaps such as individual properties can only drop in. i would encourage this committee as well as the assessor to vigorously go after all of the individuals who have done these transfers as well as individuals

who are turned in. i don't know if there is an incentive program, possibly the suggestion of you turn somebody in that you know about and there is some financial enumeration for that report. i just want to say how important i think it is to have these efforts focused in and directed toward our city. our city operates at a deficit and i support it. thank you. supervisor chu: next speaker, please. >> the countdown is still going on. i would like to speak on behalf of this ordinance. i feel like something like this is beneficial and i would like to take this opportunity to

highlight the department of public works program for graffiti busting. i think the rewards for that program should be increased since it is obvious the problem is still prevalent in san francisco. maybe we should consider increasing the rewards for our department of public works and their program. under this heading, it says rewards to informants for information. i would like to take this opportunity to reword that a little differently. i would like to reword it to show rewards to informants for information related to the detection of suspected misconduct inside the department of public health, specifically san francisco general hospital and laguna honda hospital. it is obvious that laguna honda hospital has plenty of negative

publicity. supervisor chu: if i could ask you to stick to this item which is the underpinning of property- tax. >> thank you. supervisor chu: are there other members of the clot -- other members of the public who wish to comment? seeing none, the item is closed. supervisor mirkarimi: motion to approve with the recommendation. supervisor chu: we will do that without objection. we will take a recess until our special order at 4:00 which is the hearing on the line martin for closure. thank you for your presentation and we will see you at 4:00.

chair chu: welcome to the reconvening meetings of the board of supervisors subcommittee. mr. clerk, do you have any announcements first? clerk young: yes, please turn off all cell phones and pagers. if you would like to speak, please fill out a speaker card. if you have any documents you would like to present, please provide a copy to myself for inclusion in the file. any actions taken on today's agenda will appear on the board of supervisors' march 9 agenda, unless otherwise stated. chair chu: would you call item

no. 5, please? clerk young: that would be march 8. sorry. i missed the date. item 5, an emergency hearing regarding the closure of lyon- martin health services, the impact on their client base, and provisions for continuing care or additional emergency support from the city and council of -- and county of san francisco. chair chu: i am joined by supervisors kim and mirkarimi, and also, supervisor wiener is

here. supervisor mirkarimi? supervisor mirkarimi: just some opening comments. the board of supervisors has not had a meeting on this to date. we learned about six or seven weeks ago about the possible closure an imminent closure of the health center. needless to say, we were all extremely concerned and troubled, and what we really saw in rapid fashion was a really impressive response from the community, not just from those on behalf of the 2500 patients at the lyon-martin health clinic, but others in the community.

diverse communities throughout the city and county of san francisco. people in the community through a grass-roots efforts hit -- efforts, they have answered the call to try to raise cash quickly and to fill a financial void, one that we will dissect in today's hearing to stave off that imminent closure. it did not garner just city attention but national and international attention, because this clinic, the lyon-martin clinic, is very important. it is part of our help strategy in san francisco. how and what we must do to make sure this clinic is sustained

and well supported, both through a private and nonprofit mechanism and the public mechanism, that is what we are going to explore here today. part of this hearing is to understand how it got to the point that it did. it is not necessarily about winding fingers -- wagging fingers, but also trying to make sure that this does not happen again. we will hear from the city family, department of public health, a consortium, and others, including people from lyon-martin about what happens with the financial crisis that led up to the imminent closure and what we can do to make sure that does not become a repeat scenario. and this may not be the only clinics facing this type of danger. this could be an indicator of other clinics because of the downturn in the economy

nationally. certainly, in california. this may be a harbinger of things to come. seeing that we attend to these kinds of crisises, establishing warning signs, that i do not think were there initially with the lyon-martin health clinic, that we are able to respond in a way that is not just community driven, although this time, if it was not for the community, i fear that the clinic would not have been opened even for this period of time. i look forward to hearing a thorough vetting. there is an assessment that was done by the clinic consortium, it reports that has been disseminated to us, and an opportunity -- a report that has been disseminated to us.

the preservation of the lyon- martin health clinic. i know that everyone on the board of supervisors is concerned, and i appreciate the support of supervisor wiener and supervisor campos. it was not scripted. there were no political consultants. i think you can see the concern of people from all vantage points, who tried to do everything they could to help answer the questions of how we got here and what are we going to do to get out of this jam. i am a pro representative of district 5, which happens to include the lyon-martin health

clinic, and that is also why i wanted to do everything i could -- i am a representative of district 5. there is a list of speakers. chair chu: thank you, supervisor mirkarimi. supervisor wiener? supervisor wiener: i want to thank supervisor mirkarimi and everyone for coming. i am happy to be here. i do have to leave at 4:30, so i just wanted to make sure you know that. i have been in very close communication with supervisor campos, the department of public health, and lyon-martin, and i

will be involved in trying to make sure this clinic survives. chair chu: supervisor mirkarimi, would you like to announce people? supervisor mirkarimi: yes, we have these people. >> i want to thank you all for having this hearing. i think that as supervisor mirkarimi indicated, this is part of our community. thank you. this hearing really provides an opportunity to do a number of things, not only provide the community and the supervisors with a sense of the financial situation that lyon-martin

faces, but it is also a opportunity to see how this really has brought a much increased and concerted effort by the board of directors, by the executive administration, by the department, and by the consortium to really work together to resolve this issue in a manner that suggests, as appropriate, really what should be and what can be the long-term sustainability of the organization. if, in fact, the current organization as it is configured then how can we altogether work for a situation that allows for continued financial viability and services and also the assurances that, quite frankly, we all want

to have, that the organization is governed appropriately and is administered as such, so with that, i am first going to turn it over to lyon-martin. we have their board chair. their medical director, who was come unto previously, the executive director -- who was, until previously, the executive director. and we have another. they combined will goat -- go through what is being implemented for lyon-martin, and then they will turn it over to someone who will talk about the overall entity for which lyon-