commitment to 27% hiring was an expected to to product approval, especially as hiring law was moving in the background of 333 harrison. it is our understanding there is still willingness on the part of the developer to follow through with this commitment, and thankfully, there seems to be committed to that in the hearing today. but we have also heard of pressure by some remaining holdouts, the local hiring law, who seem to -- seek to intimidate developers and contractors. therefore, before disturbing any future funds to 33 harrison, with just a follow-up hearing for the developer and contractor can share with the board language that guarantees this local hiring for local 7 to residents and soma residents as well. supervisor mirkarimi in the past years has been more than aware of the need to put this on the public record and make sure this does not -- this local

hiring commitment is not just based on hearsay. thank you. supervisor chu: thank you. >> ♪ cities cities that help soma are the luckiest city in the world a city that does not get half the amount of money know, and they need it all first be a city that helps soma people in cities help soma are the luckiest city in the world ♪ supervisor chu: thank you. >> i am the chairman of the emerald funds, the purchaser of 333 harrison. we are in the final stages of executing a document with the

mayor's office of housing committing to provide 25% local hire on the project. i should note, we are actually at an extraordinary critical part of the project. we originally executed agreements with webcor back in july of 2010, subject to approval by the fha. we did it to four contractors, and into an agreement in july. as part of that agreement, we had the agreement that was included in the webcor contract. we then took the recommendation from the board of supervisors in august. we entered the first source hiring agreement executed by our company and by webcor in november. we picked up the building permit and paid for it in december.

we have received national loan approval from the fha for this project. we have not gotten a firm commitment yet but we have gotten an e-mail from hud. our product is ready to start. we need to have the mayor's office of housing execute it now. the government is supposedly going to shut down on friday. we are trying to get the fha firm commitment in the next two days. this document, which is 100% negotiated, is ready to be executed. we are trying to do the best we can to meet our local hiring needs for the city. we are not hiring just 50% of the initial entry. we are guaranteed to hire 100% -- supervisor chu: thank you. are there any other members of the public of which to speak on this item? seeing none, public comment is closed.

the item is before the committee. supervisor mirkarimi: motion to accept. supervisor chu: supervisor kim? supervisor kim: i am not sure who i ask this question to, but my understanding is amd was the initial response to do the work to train soma residents in order to help meet the goals of employing at least 30% soma residents for additional employment. my understanding now is that citybuild will be doing that work. i wonder if i could ask some questions? i guess i'm curious as to how we are going to ensure we do the proper outreach to soma residents, in order to get them

the training they need to qualify for the jobs on this project. who is doing the out reach, how we are monitoring it, to ensure we are meeting these goals? even if we do the out reach now, i do not know when this product is getting started. if you could walk me through the time line, how this is happening. >> just to go back to your other comment, we are planning to work with citybuild to do some of the training. however, we already have funded asian neighborhood hud designs to do the training. i will let steve talk about what is currently happening. moving forward, we want to work both with amd, citybuild, and court knitters role. will help to connect the dots on all of the folks doing the work force training and development in the neighborhood. they are going to work not only on the housing but also the employment peace as well to make sure that outreach is being done, both by citybuild and by

asian neighborhood designs. supervisor kim: if you could also talk about the timeline of the project, how we plan to meet that goal. how many residents we have trained and ready to go. >> we had a contract this past year. we have trained nine folks for every contract, 15 total. four placed on jobs. moving forward, we are still in discussions. we worked to establish meetings with citybuild. the way i look at it, the discussion would be, we already have a network of folks that we work with south of market to get referrals. that is how we are able to get our soma residents into our program. we would look to keep that going into that port. at&t would provide services to citybuild, getting them into citybuild which is their hard

training. and could provide the training. post graduation, we could work with citybuild to do it post graduation placement services and follow up with the project. there are some basic numbers involved here. the union has -- we need to talk with them further but there is a set number of placing 5 community folks, essentially joined the union lines because they are being placed on call on to the harrison street project. four males, one the number graduation cycle. working with the citybuild model, similar to ours, five summer graduates. they would be guaranteed union positions. i think as the developers said,

they are trying to get going on this. i think the way the schedule looks, we are still in discussions on that. the training programs are generally 14 to 16 weeks. if we can get citybuild set up for the next cycle, when that cycle graduates, which is still kind of in flux, then they can be placed onto the developer's project site. the schedule is in flux. i would say the only basic numbers are looking at roughly 15 per year, specifically on the side coming out of the trading programs. there are still opportunities for other folks coming in through other venues on the project also. supervisor kim: i am not sure if you are even the right person to ask, but what does 30% mean? what is the number for that? >> in terms of the actual projected the entry-level jobs?

>> are you talking about -- there are long-term permanent jobs that will be somewhere between 12 and 15 actually working on the project. that could increase depending on what happened with the park. we do not know where that will stand. we are guaranteeing the 30% of those jobs will be from soma local hire. we have agreed to do that, absolutely. supervisor kim: but roughly what does that mean, 30%, what does that mean in numbers? >> if you are talking about 15 jobs, five permanent jobs for soma residents. supervisor kim: so when we talk but and you some jobs, approximately 15? >> it is just a big apartment building. supervisor kim: i appreciate the

percentages. i just want to know what that number means. i know that our programs are small. i just want to make sure that we are able to meet that goal. >> there are way more jobs in the whole union. i have seen estimates that are around 400 jobs in building the project. and you have to understand, one thing that would help is never good design. when you actually start a project, under virtually no jobs, very few jobs. you are doing excavation, digging the foundation's. it is really three, four months before as a given number of jobs. the peak of the jobs is -- in this particular project -- 12 months down the road when you have all the trades working. but the initial, not too many. they are waiting until fall. supervisor kim: so we feel confident that the training programs and existing workers

and soma will be able to meet the needs that we have agreed to in this resolution? >> i cannot imagine not. supervisor kim: since you are here, i know this is about the soma stabilization fund expenditures and not about the resolution passed in july. i wanted to ask some questions in terms of -- i know you committed to 25% local hiring. part of the legislation which you are not necessarily bound by is that you wanted to be bound by trade. what are some of those challenges to meeting those goals by trade? if not in the front end, over the long term. >> but we did last july was execute with webcor and subcontractors, the contracts subject to faa approval for the jobs. those bids were basically binding. we are subsequently going back

-- actually, the first time i ever saw this was on february 7, 2011 when i got the document from the mayor's office of housing. i had no idea that we would be subject to something that we had already picked up a building permit for. in answering your question, we are going to make every effort to do it by trade and we will track hours by trade, but we are committing for 25%, which is higher than the 20%, but we cannot actually legally commit to do it by trade. there are a lot of trades -- for example, plumbers only have 18%. they live in san francisco. it is very hard for us to actually do it by individual trades. we will make a best effort to do

that, we have agreed to -- both webcor and i will be running the original subcontractors, asking them to give preference. we have done business with the electrical pension funds. we are going to sit down with them but they are going to lean all over the unions. we will not try to do it our best by trade as well but we cannot legally commit to that. supervisor chu: thank you. supervisor mirkarimi? supervisor mirkarimi: just a couple of statements. one of the critical pieces to this is the fact that there is strong compliance with our first source law. after we upgraded the first source lot in the last several years, that obligation has now got to be delivered upon. if i heard mr. erickson correctly, they will have to deliver by making sure that this is all solidified with them in the next 48 hours, with regard

to their ability to proceed. that is a vital portion. the second part is, there are a number of other reservoirs of bodies, other than just citybuild, where we can be recruiting and enlisting people. but citybuild is through the primary reservoir, in particular. i think citybuild is the most well-known, but it is disconcerting a little bit because there is sometimes a cog in the pipeline of them being able to keep pace, especially now with the economy turning around, and then being able to turn out graduates and people who are ready to hit these work project areas so that we have the skilled talent so that we can put them right to the job sites. so there has to be a more concerted effort in working, not

just with that central reservoir of citybuild, but working with the one-stop job training centers that are also located in a variety of neighborhoods, in particular, like chinatown, western addition, mission district. not everyone goes through citybuild or those one-stop job training centers and vice versa. that is why the nets need to be more splayed in a way that is more better at attracting people in those impacted neighborhoods. i often hear about citybuild, which has been very effective and we hope it can continue to be, but it is not just citybuild. supervisor chu: thank you, supervisor mirkarimi. we have taken public, already. the item is before us. i believe there are recommendations and amendments. to the city attorney, those recommendations would not be sensitive? do we have a motion to take the

recommendations as articulated by the department? ok. we will take the motion to amend without objection. on the item which have a motion to send this item forward as amended to the full board with recommendations. without objection. thank you. item five please. >> item 5. hearing to consider release of reserved funds, department of technology - committee on information technology fy2010- 2011 budget, in the amount of $6,393,373, to fund the consolidation, standardization, and optimization of the city's technology operations and applications. supervisor chu: thank you. i believe we have mr. walton hear from the department of technology and mr. vincent. >> thank you, supervisors. john walton, the part of

technology. we have a brief presentation for you today regarding the item you are hearing, the release of reserves. associated with the presentation is an update under way to consolidate data centers around the city. we are handing out an updated presentation for you because we just did a few of the numbers to make sure there were up to date. there were no significant changes in and out provided to you. with that, if you do not mind, i will go through a few slides. and then i am sure you will want to have a conversation about this. a bit of background about the project, the technology reserved established would generate savings through city- wide technology, accomplished through across department corporation. i.t. is very centralized. some allies in the technology budget. a lot of the staffing and

expenditures exist out in the individual departments to provide the maximum amount of flexibility and operational needs of those departments. over the last year, we brought together those departments to work together jointly on a plan to consolidate individual data centers around the city into combined share data centers. the data center project that has become a key indicator of how well the city is working together to achieve these technologies savings. in that sense, the reserve has been successful. and data center operations, to put it in context, i am sure you have seen the report, consists of $70 million annually of what the city spends city what the technology expenditures. we have been working on a plan with coit. many of you are probably familiar with them. the government audit and overseas i.t. expenditures and

policies city-wide, department heads, for supervisors, mayor's office, in a two-year plan to consolidate data centers. the department's is presenting some ideas about what we think it is of benefit to data center consolidation. we think there is significant operational benefits related to this more efficient model, rather than everyone building their data centers. probably, in light of a lot of things happening in the world right now, i would like to stress it is really about disaster readiness. the traditional way we have done things in creating data centers, although some of them have been low cost, have not been the most disaster ready facilities. this new plan really improves the readiness of the city, of the equipment in these facilities, to be prepared for disaster. it is also an opportunity to become much more grain. rather than having individual

pieces of equipment scattered around the city, by joining these together in consolidated centers, we are saving energy. there are some significant environmental benefits. and then germane to the budget conversation, it generates savings over a period or after the capital investment is expected to create the centers and people move into them, then we start to see savings over time. rather than spending individually, people are pulling their money into shared centers which will save the city money. having said that, let me give you a quick update on where we are at in executing data center consolidation because we are taking actions in this area. the committee on information technology did approve some consolidation sites in the city. one is a site where we have moved data center operations from the space you heard about on march 2200 paul.

we would try to maximize the utilization in the we have already leased. and then the airport -- and this example of partnership, has agreed to construct a new data center down at the airport, using the airport staff and space at the airport to construct a shared space that the entire city should use. also unique to the project and i would like to stress, again, as an example of a partnership, rather than proposing new staff for this project, what we asked the departments to do was to look in their existing pools of staff for i.t. staff the already had and assigned existing staff to this project. i am happy to report the department of technology, health, comptroller's office, human services agency, dpw, puc, and police have all done in a

dedicated staff to this project. understandably, it is an impact on their department to reassign step away from this -- from their own projects, but they recognize the importance of it and will milling -- and were willing to make that sacrifice. also, we have tried -- i realize this is a big e eye chart, but this is a document we update frequently appeared aside from the corporation, we want to demonstrate, we understand there is a desire to see a return of the spin on this project. we're trying to show in this chart -- i will be brief about this. we are assuming the project starts this year. we are already under way with much of the virtual causation efforts.

the part of technology and health are leading the way in setting the template for the city, where the project might go on this. there are some investments we have to make over the next few years regarding staffing, construction of the new facility at the airport here. and those are the lines you see in fiscal years 11, 12, falls, 13. we are making some capital investments, buying equipment. what we are proposing to do in the short term, and in the long term, to achieve savings in the project, is reduced -- if you look at the bottom under assumptions -- reduced the level of expenditure the city makes every year on the annual replacement of equipment. across the city for technology equipment. rather than continuing the previous cycle of expenditures, we are going to reduce those traditional expenditures of equipment and redirect our efforts to the consolidation sites. around staffing, the entire i.t.

community knows in the city, just like the rest of the city is faced with challenges regarding budget and staffing, there will be levels of reduction in staffing. everyone will be able to account for a level of staff production related to this project. that is also figured into the roi calculations of this project. supervisor chu: i believe there is a question from a committee member, but i also wanted to welcome david chiu to the committee. >> thank you for the work that you have done. by way of background, we, during the budget process last year, have placed the $6 million-plus amounts on research. in part, because we recognize our city spend a lot of money on i.t., over $200 million. there is a general consensus around the city that we have a lot of inefficiencies and redundancies within our i.t. world that we need to focus on,

particularly, during these tough budget times. some of the areas we have tackled in the past has been to move to consolidate the 700 different e-mail systems we have in the city, to try to create master service agreements, rather than the contracts that different apartments have all with the same outside vendors. to work on the justice project within the law enforcement role, -- try to consolidate that project. a product of mr. walton was talking about around data center consolidation, the fact that the city has several dozen small id departments outside of the department of technology with a similar number of data centers. i'm very much appreciative the work that has been done by dt, as well as other departments, to take the several dozen data centers that we have and consolidate them into two major data centers. i want to also thank the work that has been done at coit with

our budget director, controller, and others, trying to figure out if there are ways for us to both invest in good 21st century infrastructure and save money at the same time. i do want to say, having seen six or seven iterations of this particular chart, i do hope that we will be able to squeeze out even more cost savings than this chart shows, which will require an investment of money initially in years one and two. but will hopefully lead to savings over time. i want to let our colleagues know there has been a lot of work done. while i am not excited about releasing these i.t. reserves -- i had hoped during the budget process last year that we would figure out a way to save $600 million. -- save $6 million. i understand we have made a lot of progress, and that the risk

of not wanting to knock it any of that progress off-track, i think that this committee should release these reserves and move this forward. that being said, i think we will continue to have budish conversations, as we did last year and the year before, another real conversation about other cities begin by the i.t. process. i very much hope that different cio's, it teams, dt, as well as local 21, i can help to find these cost efficiencies. supervisor chu: thank you. supervisor kim? supervisor kim: thank you. if i could ask again, what were some of your hopes in terms of the savings this year, compared to what is being rejected? and is what is being projected the $308,000? what were you hoping that we would get in terms of savings this year, year,dt had

summarized? -- savings this year, opposed to what dt had summarized? >> i think a bit closer to 2 under 25 or more. assuming the 200 budget, i thought we would be able to save 3% of that across city departments. the efforts that have been going in the last nine months on the data consolidation effort. what we found was in order to move from three dozen different centers into two, that that requires an initial upfront investment. we have to make over the next two years. while that was a disappointment, unfortunately, it is a bit of a fiscal reality. supervisor kim: given the unexpected cost that we currently have -- sorry to ask all of these questions. do you think we are on track to make these savings? i have to be honest.

while i want this project to move along, and i appreciate the efforts made, i think given the current budget deficits that we are looking at, we really need to ensure that things are moving along at pace that has been set at the past. i would be inclined not to support this release or during a smaller release and getting a report back to make sure we entr'acte -- we are on track. >> supervisor kim, you are expressing the exact concerns i have heard raised in this planning process. as some of the current members of coit, mr. rosenfield, mr. walton no, i have been frustrated at the pace of which has -- of which this has taken. i had hoped to see more significance cost savings. but i do know there has been a but i do know there has been a tremendous amount of work put in