supervisor chu: hello. welcome back to the budget and finance committee. we are back from recess. we left off with the annual budget this coming year and had gone through a number of departments. we did leave off at the city attorney. so i would like to invite our city attorney, mr. dennis arra

-- dennis herrera. >> 94 the opportunity to discuss our proposed budget for next fiscal year with you. as many of you are aware, the city attorney's office provides general counsel advised to over 100 city departments, agencies, and commissions. drabs theory the legislation that implements all your wonderful ideas. negotiates contracts, business, labor contracts, handles over 4000 claims a year and acts affirmatively stepping into the general office of the city california.

i am aware that some departments have provided you powerpoint presentations, and i will spare you that. we know that time is of the essence for you as you review. i am happy to report that we have been in consultation with the budget analyst and with respect to our proposed budget, we are in agreement with -- in concept with the recommendations that have come from the budget analyst. we're just still identifying exactly what hot -- pot those additional cuts should come out of, but we do not have a problem with that whatsoever, and we have worked with them over the course of the last week. i would just like to highlight for you in addition to the cut that the budget analyst is proposing, note that you are seeing a level of general fund

support that is decreasing in the city attorney's office in the amount of about $915,000 or so, which is a reduction of 12.5% of our general fund contribution from last fiscal year. so our general fiscal -- general fund support is going down to $6,305,643. the budget analyst is recommending an additional cut, which i said we do not have any problem with conceptually, and we will work out the details of the where that additional money -- exactly what pot it should come out of. i know there has been some discussion, and it has been desired that you would like some information with respect to what our five-year financial plan is. i will say that we anticipate that we will see about 8% to 10% financial growth over the course of the next five years. that is mainly due to salaries and fringe benefits that our lawyers and other folks will see

an increase in over that time. about 95% of our budget is just made up of salaries and benefits. when there are increases going to city employees, that is where we experience whatever growth we have. over the course of the last several years, we have cut -- we have renegotiated our office lease. we have renegotiated all of our outside vendor contract with respect to legal research and periodicals that we are provided, and really, what is left for us to deal with is salaries and fringes, but that is what we anticipate. the one unpredictable part of that is you were aware that we had to come in to this board during this year for supplementals. oftentimes, we have and anticipated litigation -- unanticipated litigation that the explosion is quite high. whether it is ada access or a large public works contracts that money has not been budgeted for the litigation from our

general fund department, but the potential exposure oftentimes is in the tens of millions of dollars. we try to find that to the degree that we can with the existing resources that we have, but there are times that we have to come back often times with our sponsoring department to see the supplemental from the board of supervisors. the reason i bring that out, that is the type of thing that we cannot necessarily anticipate, but could arise at some point in the next five years i guess we have litigation that is anticipated, but is quite costly, which could impact what it is that we need to do. i do not see any broader were big initiatives that i plan on implementing in the near future that would necessitate significant additional resources in a city office, and we would be able to handle those in the conference and our

budget and with you. like i said, we will continue to work with the budget analyst, but you're sort open to any questions that any members of the committee have. supervisor chu: thank you. i have two quick questions. one of the issues brought up in the report was the affirmative litigation account, and that is -- i guess it allows use some discretion to be able to pursue some public-interest cases. can you speak about how it is you make your decisions on the kinds of cases you pursue and what is out there? >> i think the affirmative litigation program of the city attorney's office has been something that has been a tremendous boon to both the tax payers and the citizenry. if you look at the nature of the cases that we bring in our affirmative litigation program, there are things that i think represent looking out for the best interest of all said redskins. whether it be done litigation or cigarette litigation -- those

are things that have been utilize. -- for the best interests of all san franciscans. wherever there is cutting edge, proactive, consumer litigation -- usually -- or sometimes really protecting health and safety, we will pursue that. we get approached a lot of folks, and what i try and decide and how i reach my decision about cases that we should pursue is is there something -- a vacuum that is not being filled by the private bar? and two, is there something you need that having -- unique that having the weight of the city attorney's office -- do we fill a vacuum where we're doing something that benefits our citizens? is it something that no one else is doing what it calls for the full weight of the city attorney's office to get involved, and can we make a real difference? there are plenty of cases i do not get involved in, but there

are obviously a number that i do get involved in. there are cases which actually it would be worthwhile for me to get involved in them, but the vacuum is already being filled by the private bar and i did not have something new to bring to the debate, i generally do not get involved. that is kind of how to make the decisions. looking at things like the moran power plant or marriage equality -- those types of things, i think that calls for the involvement of the city attorney's office, and that is kind of how i make my decision. supervisor chu: the other question has to do with the $1.1 million that is expected to be received as a settlement. we have not seen this one before. >> yes. there is a proposition that past several years ago, which mandates that any recoveries that you get on business practice cases has to be used

for consumer protection or affirmative litigation has to go for that use. the settlement that we are -- hold on one second. this one -- i wanted to see what i could talk about. the 1.1 settlement that we are receiving is a case involving land america, which is a mortgage fraud case brought by the attorney general's office, the district attorney's office, and my office, and we were about to provide the proceeds. that $1.1 million that we will be receiving is our portion of that settlement.

supervisor chu: all right, why don't we go to the budget analyst report? >> madam chair and members of the committee, i recommended reductions to the proposed budget as detailed on pages 71 and 72, total $30,212, and of those reductions, that is 100% general fund ongoing reductions come still allow an increase of about $1.8 million or 2.8%, and dept.'s budget. we also recommend closing up $3,876 of prior year general fund incumbrances, and as stated on page 72 of our report, and that is what you were just inquiring about, there is -- actually it is $1,025,000 of revenues, which was based on the state attorney general, the city attorney, and the sand francisco

district attorney, who have been litigating this case for several years. as $1,025,000 has not been included in the budget, and therefore, we recommend that you included in the budget. that would result as a general fund savings. i might also point out that you will see the same recommendation tomorrow in the district attorney's budget. it will be a total of $2,050,000 of direct general fund savings. i believe those are the highlights. together, our recommendation would result in $1,134,088 savings for the city general fund. supervisor chu: thank you very much. supervisor wiener: i just want to -- this is for the future -- i do not know if you want to

give the city attorney more money because in the future, for better economic times, and of course, i did not have any personal experience of this, but i think that this is through the city attorney and even more so the d.a., that we do not have enough support staff. when i went from private sector to the city attorney's office, one of the biggest shocks for me was particularly the lack of paralegals. i know that the paralegals and support staff generally that i worked with in the city attorney's office -- they were superb, and they worked unbelievably hard because of the -- we just did not have enough, and is more extremely the nba -- the d a's office because there's so few support staff over there, and it does impact once worked as an attorney. and i know that times are tough, but at some point, i hope the office will make an evaluation

of perhaps adding some support staff. >> supervisor, i agree with you wholeheartedly. you know better than anybody how hard the support staff in the city attorney's office works, and we would welcome the opportunity to add more people because it is a real drain on the work that attorneys have to do. especially when we are decreasing general fund support. the work that folks are called upon to do, they are called upon to do even more, and it does provide a strain. i welcome those comments, and we are going to do whatever we can in the future. supervisor chu: thank you. thank you, supervisor wiener. the recommendations currently total about $1,130,000. because part of the recommendations would actually be considered an increase in

revenue, and that is only something that the mayor's office can do, correct? >> we have discussed this with mr. wagner. this is revenue that we have identified with the city attorney and the district attorney and the board of supervisors is absolutely authorized to place this in the budget. supervisor chu: technically, mr. controller, do you want to answer how we would do this? i think we would accept the $30,000 in recommendations and keep the $1 million to be added back in through an adjustment with the mayor's office? that as a technical matter, that is correct. because additional revenue is needed to grow the size of the budget and the charter only permits the board of supervisors to reallocate what is in the existing size of the proposed budget, mr. wagner would need to move this as a technical adjustment.

>> let me just clarify -- we discussed this with mr. wagner. my recommendation to u.s. on this $1 million, this could be considered a savings that the board of supervisors has achieved. it was not identified by anyone until we reported it. and the mayor wants to make a technical adjustment, fine, but i believe that the board of supervisors should get credit for this $1 million. in other words, when you add up your part of total savings, which includes both revenues and expenditures, you should include this in your total amount of savings. supervisor chu: absolutely. and then a question to the mayor's budget office -- >> i could get credit for the end get the support staff that mr. wiener has just identified. supervisor chu: will you be

submitting a technical adjustment that would include this increase? >> just to clarify for the budget and legislative analyst, i think the point here is not about credit and who uses it. it is a technical point that the controller raised regarding the ability of the board and the mayor to increase the total size of the budget. and because it is a new revenue, it requires the executive branch to increase the size of the budget. we will certainly be working with you on this and other questions of this nature. i know there are other questions that have come up about encumbrances and increasing the size of the fund balance, so we are here to work with you and the legislative analyst on this issue. supervisor chu: thank you. i want to thank mr. rose for identifying the source of revenue. and if we can do or take the recommendations without objection, and then reserve the $1 million to be added back through a technical adjustment,

we can do that without objection? thank you. >> i would gather than that since the budget analyst at my office are in agreement on cuts, there's no need for me to come back for the second hearing, correct? supervisor chu: absolutely. thank you very much. >> thank you. i appreciate it. supervisor chu: ok, our next department is the city administrator. thank you, ms. brown. >> good afternoon. i am happened to be here today as your acting administrator for 2011 and to be presenting to you the ad and services portion of

the general services agency budget. the general services agency is a broader array of departments, divisions, offices, and programs. you have heard previously about our capital budget, and you will hear later today separately from the department technology and the department of public works, also part of the gsa. gsa's primary mission is to promote efficient delivery of services, and the majority of services we provide are to support the operations of city government. examples of these functions include maintenance operations and management of city-owned buildings and infrastructure, per german and contract administration, fleet management and vehicle maintenance, real estate leasing and acquisition, city-wide mismanagement, and city-wide capital planning. while i am very proud of the achievements of everyone in the gsa, i did not have time to go through each division to highlight accomplishments in the last year, so i will just touch on a few. in