supervisor chu: good morning. welcome to the budget and finance committee. >> please turn off all cell phones. if you submit copies of documents to the committee. items discussed it will appear on the board of supervisors in jeddah on july 12, 2011, unless otherwise stated. -- the board of supervisors agenda on july 12, 2011, unless otherwise stated. item one, consolidated budget an

annual appropriation ordinance appropriating all estimated receipts an estimated expenditures of the city and county of san francisco for fiscal year ending june 30, 2012 for the airport, port commission, and public utilities commission. item two, and will salary ordinance enumerating positions in the annual budget and appropriations ordinance for the fiscal year ending june 30, 2012 for the airport, port commission, and the public utilities commission. item three, resolution approving the budget of the redevelopment agency of the city and county of san francisco for fiscal year 2011-2012 and approved the issuance of three development agency of bonds in an aggregate principal amount not to exceed $84 million. item four, resolution approving the budget of the treasure island about authority for fiscal year 2011-2012. item five is no longer under the jurisdiction of the budget

and finance committee. item six, ordinance amending the san francisco administrative code to increase all fees on the controller's annual two-your average consumer price index ended up in findings, including environmental findings. item seven, ordinance amending the san francisco planning code to increase fees. item eight, motion approving an exercise in the final option to set forth an agreement for professional budget and legislative analyst services between the city and county of san francisco and harvey m. rose

associates, thereby extending the term of the agreement from january 1, 2012 through december 31, 2013. supervisor chu: thank you very much, mr. clark. again, all items on the agenda had been called, and they are all related to the budget. -- thank you very much, mr. clerke. we have for our day-to-day a couple of departments that had not yet reached agreement with our budget analyst last week, so we will be bringing those departments back up today. why don't we start with the department economic and workforce development? since we did hear from you last week with regard to the general direction of the department among other things, if we could just concentrate on the budget analyst recommendations and where you are with those? >> yes, good morning.

director of the office and economic workforce development -- we work diligently with the budget analyst over the last week, and i am pleased to say that we are in agreement with their recommendation. there is one recommendation that i believe is memorialized in their report to you that we have for the negotiated since it was published, and i believe we have agreed that it will be withdrawn. that one is specifically the disapproval of intern exemptions of the four new america's cup positions, and having those positions be effective as of the beginning of the fiscal year on july 1, rather than those positions being 0.9 position that would have gone into effect on august 1, but other than that one modification, we are in full agreement with the budget analyst recommendation. >> madam chair, and members of the committee, we have recommended reductions of

$74,744, but we will adjust that for the reasons just stated by the department. we would just advise this morning -- and this recommendation, supervisors, on page 7 is the last times on page 7 where we say "disapproval of the interim exceptions for these four positions that do not perform revenue-generating and critical department functions." we were just advised this morning that those positions are actually existing positions in other departments that will be transferred to this department. on that representation, we withdraw that recommendation, and we will adjust our total recommendations for the salary for that one month as well as the mandatory fringe benefits. supervisor chu: thank you. if i understand correctly, there was a series of recommendations

with regard to reclassification, and the department is in agreement with those recommendations. >> correct. there were down with substitutions for the three positions and one remains the same period supervisor chu: with regards to the -- the same. supervisor chu: the budget analyst is withdrawing their recommendation and saying that it is fine for a july 1 start because these are all existing individuals who are employed by the city. >> just one other clarification -- on page nine, we have a reserve recommendation, so we will take out that portion of the interim for the reserve amount, and we will work with the controller for that specific adjustment. supervisor chu: thank you. are there any questions from the committee? if there are no questions, if there is an agreement, we will take that without objection. >> one further clarification --

i am sorry -- at the recommended reduction that i initially said that i will adjust downward, it does not affect that amount. it just affect the reserve amount. just for the record. >> that is consistent with what i see as well. supervisor chu: ok, thank you. we will go to the next apartment. redevelopment agency. >> good morning, supervisors. we are in complete agreement with the budget analyst, and we want to thank everyone for the wonderful budget process thus far. supervisor chu: ok, so, the redevelopment agency is in agreement. any comments from the budget analyst on the redevelopment agency? >> no further comment other than that our total recommended reductions are $459,572,

including $215,999, which are general fund reductions. supervisor chu: just a question for either the city attorney or the controller's office, do we need to do anything else to get actually these recommendations? >> supervisors, know. if they agency concurs with the budget analyst recommendations, no action is required by the board. supervisor chu: thank you. supervisor kim: just wanted to thank redevelopment on the memo on some of my questions. i still have a concern -- this is not just redevelopment, actually. it is general, any reduction in funding for workforce development and job training, but i understand we have and others that led to some of

those reductions. just showing that we have a continuance of job training. >> just to clarify, the committed -- the commission had committed over $4 million over three years for workforce development, and we are now in the second phase of the 18 months. while we did see the exploration of the area and the tax increment seceded, we did provide extra funds. just to keep in note that with all of our funding, and i think there were some reductions in some workforce organizations this year, we did more money in it organizations. that said, we were mindful that some of the organization's were not serving our project areas. under those recommendations, we cannot use our tax increment for anything outside of our project area. that is why some of the reductions were made and some of our budget as a nonprofit

workforce organizations, and in other jurisdictions like mission bay, transbay, and the shipyard, so we increased funding in that area because they were serving our area. but over all, we are on target and will probably exceed funding. >> appreciate that. we try to help individuals with multiple barriers to employment. that is really important for our residents. supervisor chu: thank you, supervisor, and thank you to the redevelopment agency for working with our budget analyst to come to agreement. we appreciate that. ok, moving on. department of building inspection. >> good morning.

the department of building inspection has actually agreed with the budget analyst's decision or the budget office's decision, and we have gotten complete agreement. supervisor chu: sounds like the department is in agreement with the recommended changes that would result in a reduction of $984,000. >> yes. supervisor chu: with regards to the close out of prior year budgets for projects, $27,000 worth? >> yes, we do agree that. supervisor chu: budget analyst, any comments? >> i have no other comments. supervisor chu: if only they would go this smoothly. thank you. >> you are welcome. we would like to thank everyone for helping us. supervisor kim: i apologize again because i forgot to bring harvey rose's report in with me,

but i had a quick question. the question about having the interim deputy directors over the course of last week. i just want to know, what were the long-term plans for the third interim deputy director? i'm sorry, there are two deputy directors currently, but now there is a third interim deputy director? >> right. we have lawrence cornfield directed to the office so we have an acting as deputy director so we can make a decision as to whether that deputy director is sufficient, and we also have a vacant position. ed sweeney is filling in as both the inspection -- director of inspection services and deputy director of code enforcement. supervisor chu: including your vacant position in the interim, how many deputy directors do you have? >> we have four. supervisor chu: there was a

question posed to our office, and we were not able to figure out the answer. it was whether by charter, dbi was only allowed to have two deputy directors. >> that has been taken with the city attorney. the position for the code enforcement deputy director was a hired position, and we tx-ed a higher position down for administrative services director. those were actually budgeted at higher positions. we brought them down to a lower position so we would have a consistent management staff. supervisor chu: just the last question, what is the long-term plan for the interim director currently? >> we will choose a permanent deputy director -- right -- for both the positions.

one is acting in from right now, and one is actually vacant. -- what is acting interim right now, and what is actually vacant. supervisor chu: thank you. if there are no further questions and given that there is agreement with the budget analyst recommendations, we can take those cuts without objection. thank you. next department is the planning department. >> good morning, supervisors. we have been working with the budget analyst office all weekend. we are also in agreement. i believe the number is about $113,000 that we have agreed to, so we are pleased to say that we are in agreement and we thank the budget analyst office for working with us all week. i would also said the items 6 and 7 are related to planning department fees, and you would -- you may want to hear that as

well. supervisor chu: if you could, would you speak about items 6 and 7? >> sure. >> good morning. item 6, and is the administratie code. these are the ceqa fees. the legislation as correcting oversight when we amended the fis last year. we added a wireless telecommunications facility fee and payment plan feet. section 3122 allows the controller's office to adjust the ceqa fees, and that section was not amended to include those two new fees, so this proposed legislation makes that correction. additionally, it applies the cpi for next year. item seven is amending the planning code fees. primarily, this ordinance proposes to put a cap on fees

that are based on construction costs so that the initial intake fee does not exceed 50% of the cost of the construction. this is primarily to address small, over the counter projects where the fee oftentimes is equal to or sometimes even greater than the cost of the construction project. and then also, it applies to 2.07 cpi increase. supervisor chu: thank you very much. any questions from the committee on these items? why don't we go to the budget analyst report? >> madam chair, members of the committee, i believe the department has stated that they concur with the $113,608, and i have no other comments. supervisor chu: thank you. before we move forward, i would like to take action on items 6 and 7, which are the fee

updates. these would allow for the cpi adjustments. we do need to take public comment on items 6 and 7, so why don't we open these items up for public comment? are there any members of the public who wish to speak on items six, which pertains to administrative code at the updates, or items 7, planning code fee that date? seeing none, public comment is closed on these items. if we could move items 6 and 74 to the full board. it will join with the remaining budget on july 12. can we do that without objection? thank you. given that the department is in agreement with budget analyst recommendations, we can take those without objection. that will be the case. thank you very much to the planning department. our next department is the

assessor/recorder's office. >> good morning. unfortunately, we were not able to reach agreement with the budget analyst. we have a number of items where we do have significant concerns regarding the potential revenue indication. every single one of our staff has a revenue number tied to them. just to go through the cuts, i think this is an order. there's a proposal to cut a supervisor of fraser. we have two teams that we have and two supervisors. each supervisor is about to supervise about eight people, which is already higher than normal. usually, it would be six. to the budget analyst for roses to have one person supervise 16 people, which we find would be, frankly, impossible. the teams are supposed to be working on -- it is actually

appeals. we believed it would be impossible to guarantee the quality control or really to approve the work in any sort of timely fashion, given the situation. there's also a proposal to cut our temporary funding, which has historic we help us deal with workloads, flows up and down, as you can imagine with any sort of temporary situation. we were able to bring in temps last year to bring in -- to deal with the surge. we imagine we might see a surge coming this year as well. we will not know until after the fiscal year begins how to deploy those resources. there is a recommendation for i believe a 75% cut, and we believe they would have roughly a $4.9 million revenue impact here last year, the terms were primarily deployed as clerks.

we determined there is about 15% deficiency given by appraiser because there's an assumption that it is the clerical staff, that they are non-revenue- generating, which is not the case in our department. appraisers historic we have had to pick up a recent low of clerical work, so we deployed clerical staff last year to help assist appraisers in becoming more efficient. the other proposal was to cut a limited duration auditor. we have two auditors we are hiring to work at all the tenant improvements in san francisco. there is billions of dollars of assessments up to do. we had two people there, a team of two cut down to one, and we believe there is about a $4 million in fact for that honor to position. additionally, the last position, i believe, was 40 to 61, which is an entry level appraiser. we also have concerns there

because we estimate that as about a $1.6 million impact. again, as a reminder, we were able to exceed all our revenue is projected in each of the last three revenues, and we believe our revenue assumptions are relatively reasonable and conservative, so we do have concerns that whatever cuts may be coming would be penny wise and pound foolish and that there would be revenue impacts with each of those positions. happy to take any questions. supervisor chu: thank you. are there any recommendations that you are in agreement with? >> yes, i believe we did have [inaudible] >> they disagreed with all of them. >> oh, did we? >> actually, we did agree to the interim exception recommendation that we hire instead of -- instead of hiring

in july, we would hire in october, so we did agree to those. supervisor chu: do you know what the value of that recommendation was? >> we will compute that. >> to put our recommendations into context, i want you to note that we work with all of the department's. last week, we recommended to you a reduction of $1,859,705. that was our recommendation to you last week. this week, we are recommending a total of $584,211. in other words, we attempted to work with the department in any way we could insignificantly, as you can see, when from $1.5

million to $584,000. second, i want to point out that we just issued a report at the request of the board regarding a review of the impact of new positions on the 29-2010 access report, and this is on page 39 of our report -- 2009-2010 assessor report. it stated that the assessor should develop productivity measures including all functions and functions by complexity, a real property division staffing plan should be developed to meet short-term and long-term property assessment assessment appeals workload, including the proper mix of temporary and permanent staff, and, supervisors, and methodology for estimating revenues based on the staffing and productivity measures. while it is true that the controller makes some estimate of revenues, this department does not have detailed documentation to support their

revenue estimates. we recommended that the assessor submit productivity measures pertaining to property assessment and assessment appeals functions to the budget and finance committee on or before october 1, 2011, prior to the higher 10 limited 10-year positions not approved as interim exceptions. briefly, i would like ms. campbell to briefly summarize the disagreements, the recommendations that the assessor disagrees with any basis for our recommendations for your consideration. >> good morning. first of all, to answer the questions on the value of the interim exceptions [inaudible] i did not have a page number -- page 42 of our report. supervisor chu: i think supervisor kim would like to repeat the number.

>> $53,871. two interim exceptions that were not approved and which they are now agreeing to. in terms of our recommendation, the components -- real property auditors to look at tenant improvements -- we are recommending one of the two based on what we perceive to be their case load and the need for this new function. probably the more significant recommendation is the requested 17 new positions to work on the assessment appeals. we look at the backlog and the case -- caseload change year-to- year. we did acknowledge that there was an increase and a need for more staffing.

we are recommending 15 of those positions. seven of them are positions that are working on a temporary capacity that will now become permanent. it limited to 1000 hours 2010 s 2011, but at permit physicians, they will be able to work more hours. -- permanent positions. the recommendations are based on what they were able to achieve based on workload in the prior fiscal year and what we anticipated in terms of their workload and staffing in the coming fiscal year. >> i just want to emphasize we are recommending a large number of new positions for this department. but our recommendation is to prune back some of the positions, and we believe we are justified in this recommendation. supervisor chu: thank you.

i wonder if the assessor would like to respond to those. >> the analyst is correct that we do have very detailed information regarding how much work our staff produces. again, just to clarify, in terms of revenue, the revenue impact is squarely based on something which is out of the control of our office. the revenue impact really is based on when the previous owner purchased or sold the property. for example, we could reassess a $1 billion a piece of real estate in san francisco, but if that building was sold the previous year, there would be almost a negligible revenue impact. if, however, the building were sold 30 years ago and was on our assessment roll for a $10 million versus $1 billion, there would be a significant revenue

impact. we believe it is the job of the controller's office to assess real estate, and will work closely with them to estimate revenue. we have a very detailed plan as to the number of people, given the huge appeals workload -- again, i apologize that i did not have the chart in front of me, but we have 6000 appeals in front of us, which is triple the number of appeals from the dot- com bust. we estimate a couple hundred million dollars of revenue at stake. we are recommending staff to properly defend -- we actually think the number of staff is actually -- we know it is larger for the city, but we estimated we would need upwards of close to 60 to 80 more staff to clear out our backlog as well as defend all these appeals. given the staffing in our organization, we would have no