i am going to pay them for benefits. thank you. >> thank you. next speaker please. >> i am the chair of the uc berkeley's center for education, and i was also involved in the creation of this law. i want to go back to what he said about 20% of the people use 80% of the features. it does not give back to the point. a quickly look at families without expenditures, someone earning $20,000 a year in 2007 spends $2,000 a year on health care. that is medium. we know people who do not have coverage are more likely to skip

needed care or live on healthy lives, have lower productivity. that hurts in terms of business productivity, and it hurts their health. finding that 50% of employers are paying out from 0% to 10% of expenditures is well off what you would expect. this would indicate there is a different pattern of restrictions going on in utilization of these programs. if people were to use it in health care costs step would underline the health care pool, many of these are stand alone. people are not offered a job- based coverage. i do want to draw your attention to some economic impacts.

there was a study done by one of the former bush and visors to look into what happened following the passage of solana end to doing comparisons with other cities found no adverse impact in which employment we do with employment. >> thank you. if there are any other members, you may come on. >> commissioners, i want to reiterate something that was said. we are not here to renegotiate or reexamine how the san francisco as awful. it sounds like a lot of the testimony is saying we need access to health care. i could not agree more.

we are saying a sufficient way to do that is to provide a tool for businesses with an h.r. a. it provides funding to go to the doctor. we think it should be done well. it needs to be done responsibly. if we believe there is a pattern of denying benefits, let's ask that in next year's survey. there are ways to determine what is the problem without causing a $50 million year hit. this is a $50 million your hips businesses are currently in not taking. let's increase notice and see what we are getting.

to say we are going to make a 100% expenditure for people not accessing that benefit, that seems like a dangerous approach for our local employers. thank you. >> any further public speakers from seeing none, public comment is close. commissioners? >> i just want to say that when i think about this ordinance, i believe the workers -- health care is paramount, and their access to health care is of paramount issue, so for employers who are trying to exploit a loophole in the tax code, i have no sympathy for the

denial of these benefits in the ordinance. i understood it pretty clearly, and i understood what my responsibilities were, and i and understand what i have to make available to my employees under the ordinance, and what i used sonathe hra was for the tax benefit. you get 100% use of your money without it going to the employment tax system, so they can use it for another benefit if they need to use it, up because they work fewer than 20 hours a week or because they do not qualify for a health care

plan. the other thing is there is no expiration. they earn it per hour. it is clear there is no expiration. i would like everybody to look at the language that employers can use that is susceptible to the city. we need notification. we need what are covered expenditures. i have of list. are believed the employment community can use a list of the

it -- i believe the employer can use a list of covered expenditures. isn't that a comprehensive guide under the tax current, we need more regulation requirements. we need a determination of what happens when an employee leaves your employee. i know you have agreed to talk about these issues, and you would say we need this. particularly the smaller businesses and people conducting language in different -- now conducting business in different

languages. they need this language as much, so i would make a recommendation that we ask for detailed notification language and regulation to start to make sure people can access the money they are entitled. >> i appreciate your comments. with respect to the notice, a thing no one questions the need for that to be addressed, but that is not the sole reason we are here. we believe we need to make it clear that when the law says an expenditure has to be made that means an expenditure has to be made. i want to make sure people understand we are not trying to eliminate h.r. .a.s and.

i am just saying the main thing that has to happen is that we make this available to the employee. with respect to the question about can we provide more clarity, legally, we are not allowed to do that. we cannot say what is permissible in terms of what to do with these accounts. >> you are not able to do that for these accounts, but aren't you able to do that for complying? aren't you able to say, this is what qualifies. these expenditures are the qualified expenditures, no matter where they are.

they just say, i will reimburse you. >> they have gone as far as they can legally go, and we have followed very closely what they have said about this. we are following a clear guidance from the city attorney's office, because we know the moment we go down in the road where there is a possible legal question, we know the track record on healthy san francisco is that we were sued, so it knocks -- it would not surprise us that we could be sued again, which is why we are trying to put together a piece of legislation that can survive a legal challenge, so we have gone as far as federal law allows us to go for discussion of these accounts, but let me

say that i will continue to have an open door, to meet with small business and to hear the concerns. we are going to meet with them tomorrow, and i would be happy to get any suggestions common -- to get any suggestions, and we have lived -- and we have listened closely. the dialogue will continue. >> one comment i wanted to bring up is that the burden of creating a business that is going to employ 30, 40, 50 people certainly has no connection to profitability, and

profit margins are so slim. plenty of company has an -- companies have been one employee, to employees -- two employees, and i can hang out with a buddy of mine who has a smaller business. maybe they have two employees, and i know they are making way more money than my business makes. i am providing the social- service of creating a lot of jobs, creating for the events on tour, providing a culture. that has nothing to do with my point. my point is we have a smaller

businesses that are profitable, but what if we create a model where all small and businesses in the city in -- now small businesses in the city paid into this program, and we will create the revenue we need to run this correctly? when we were creating this, it is about creating a lump-sum of money the health the san francisco would operate under, because the public health department was commonly running at a deficit, which contributed to the fact of so many other departments have had their

budget defined by elections. well we do not want to say this is about this issue, the incorrect use of accounts for employees, but i think it is about the bigger picture and why this program is not working and why so many employers are running to create these accounts and why we could not have created a more well-funded program for community health care was going to get the kind of money they needed to service san franciscans, so i do not need an answer, but i am pointing out there are other ways to create more money than worrying about employers who are circumventing the law.

>> i sing it is really powerful to your -- i think it is powerful they hear from folks from the community, but any businesses who are trying to create job opportunities, and we feel for them, and if there is anything we can do to address the concern, we will have an open mind and try to listen and see if there is any possibility of a balancing these interests. this is clearly a complicated issue, but we have to do it in a way that recognizes the there is this new poll. i think the program is working

-- this loophole. i think the program is working. i cannot tell you how many times i went to meetings where this comes up. we are a model, but there aren't weeks that need to happen, and -- there are wheat -- tweaks that need to happen. we are trying to live up to the original intent of this legislation. it is not perfect, but i think it is something we have been proud of, and now it is just a matter of trying to make it better. >> i am sure we all feel the stories of abuse are pretty horrifying, and these people are really bad actors, but i have to say i am concerned this is too broad a net right now,

especially since we are in the novel of for recession. so many businesses are just barely surviving, and i am concerned about their welfare, and i am wondering if there is another approach -- for example, raising higher penalties for non-compliance. it just seems like it is an unholy trade-off. we did not want to see small businesses cutting back on their employees. we want to see everyone treated fairly. i am not sure if we should rethink this a little more before moving forward. >> i agree that we should not

penalize the businesses that are complying with the law, and we should take a look at enforcement to make sure everyone complies with the law. >> i think what i have heard is we definitely want to not seem to be complacent towards employers who are not complying with the spirit of the law. we do not want to do anything to give support to that, so i think we should have a motion but would clearly states that, and it seems there is a lot more discussion about this. it was compelling to hear people talk about what it is going to do to their bottom-line, and let

it was equally compelling to hear from some people about it causing terrible problems and pain for them, so do we have a motion? >> i will motion not to support this at this term -- at this time, and i hope you talked to small business. i think we are penalizing businesses but have been compliant, and i agree there is a better way of doing this. i have businesses closing every day.

they say, what are euan going to do about it -- what are you going to do about it? i have three more businesses but are going to be closing. they said if this ordinance passes, they are shutting their doors and moving out of town. i appreciate supervisor campos. i am very happy you are going to be meeting with the chamber of commerce and the small business network to work on a solution that will be happy for both sides, so i make a motion that we declined to support this. >> do we have a second?

>> second. >> all those in favor of? >> aye. >> i would like to make a second motion if i may. >> please. >> i would like to move to recommend to the city strengthen the requirements to insure all employees who are covered are aware of the coverage and how they can access it. second, they should improve the reporting they are doing on employers so the data is more accurate and those that are not targeted candy contacted. all of those that are affected, including small businesses, should be included in any

changes. >> i second. >> all those in favor? >> aye. >> that is about. >> i want to thank the commission for giving us the opportunity to come before you and for all of those men who have been able to testify. i have a great deal of respect for each and everyone of you. we have certainly listened to your concerns, but i have to say it is a disappointing day because the commissioner is sending the wrong message, and i want to apologize for the workers and businesses that are trying to do right for the workers of san francisco, but thank you for your time.

>> next item. >> you are now on item number eight, discussion of possible action to make recommendations for the board of supervisors, administrator for code enforcement of minimum wage by the office of labor standards. >> my name is hillary, and i and a legislative aide for david campos. this is an ordinance our office is working on for progress of workers alliance, which is an alliance of dozens of organizations representing minimum wage workers in san francisco, and i am going to spare you a long introduction, because i know you are very tired and i appreciate your time, but this ordinance is

designed to give additional enforcement tools to target the worst employers in san francisco. those are the employers committing wage theft. those are the employers doing everything they can to avoid obligations to pay minimum wage, to pay overtime, to pay workers for the actual hours they work, and it is designed to do that in several ways. it provides additional tools, including the right to access places of labor, to expect -- to inspect the books and records and investigate such matters to determine if a violation has occurred. it requires employers to pose notice to their employees if

there is an ongoing investigation. it if the employer has failed to comply with a settlement agreement or with an adjudication of a violation. it increases the penalties from $500 to $1,000 for retaliation against workers who exercise their rights under the ordinance, and finally, it allows osb to issue a citation. without going through the notice requirements. it will allow them when they feel is appropriate to cite those on the spot for violating the law. it also calls on them to make every effort to resolve complaints in a timely manner and take more -- no more than one year to settle.

the old saying justice delayed is justice denied. it is so true when it comes to low-wage workers who are not paid their minimum wages. they cannot make their ranch. they cannot make their ends meet in san francisco, so these are long-delayed processes, and a harm us in a way that is devastating to their lives. finally, to create outreach materials that are designed for workers in particular industries so they are aware of their rights under the laws and allow them to claim any unclaimed back wages for any enforcement if the wages go on claim for three years. so that is my presentation. i am here to answer any questions you may have. president o'brien: commissioner

clyde? commissioner clyde: i heard that. but this goes a long way. human trafficking. there are very, very serious issues that this addresses, and i think this goes a long way to eliminating human-rights violations that are perpetrated, so thank you so much for your work, and i will be supporting this. >> thank you. president o'brien: commissioner kasselman? commissioner kasselman: yes, think you for coming to speak to us. since this does not stipulate where the money comes from for the outreach, where they're going to get that funding. >> they currently contract with four community-based

organizations that work with workers in particular industries and have the language and cultural skills to work with those workers. it is called the outreach collaborative. that is already a relationship that exists. what this section of the ordinance does is it just asks them to work in collaboration , so the use their existing outreach budget and to perhaps make adjustments to the materials so that they are better targeted towards the industry and the workers that are most suffering from wage stuffed. commissioner kasselman: nothing additional is needed? >> no. commissioner kasselman: thinks. commissioner: i am in a business

where if you do not have your signs up, you are fined. in just to reiterate what commissioner clyde had said, there is a lot of human trafficking here in san francisco, and i have seen this firsthand, and there are people being paid low wages below minimum wage, and it is an expensive place to live, so i will be supporting this legislation. >> thank you. president o'brien: commissioner collide? commissioner clyde: in the hearing, it was stated that one or two are paid below the minimum wage. i believe chinatown was cited as -- in one of the studies, that one out of every