we do have many that do not. the question is -- why? one of the things that mr. chiu had mentioned was -- what are the solutions? i think education is really the solution. they do not understand what it will cover, so they do what they always do. they go straight to the emergency room and figure the taxpayers will pay for it. i am a taxpayer as well, so that does not help me, either. maybe in the emergency room, there is a box that you have an hra plan, that gets used first and applied to the bills' first. maybe that is also a solution. another solution would be to educate them more about instead of going to the emergency room, that there is an opportunity for them. i think education is key. we try to do our best. we had employee handbooks. we actually give seminars to new employees that come in. our process is simple -- you fax

the receipt and fell out the forms. not complex. i am always surprised when employees do not take advantage of it when they have the funds available year after year. they are all informed about it, but they did not take the time to use it. that is all i wanted to say about it. supervisor campos: thank you very much. >> good afternoon. jim lazarus, chamber of commerce. we appreciate the efforts you are making to update the legislation that we all work on with supervisor ammiano in 2006, but i think we need to get this back in meeting with the health department, which held the san francisco, with the office of labor -- with healthy san francisco. the important part of this is job loss in san francisco. i was surprised to hear your

experts say that our economy has 600,000 jobs. supervisors, we have not had 600,000 jobs in this city since 2000. has been 11 years. it costs a minimum wage employer hiring entry-level " sanford cisco 40% more to employ folks in the city than it did six years ago. higher minimum wage, health mandate, sick leave mandate. those are good public policies, but you have to understand it has an impact on employment. during the recession in 2002- 2003, we will -- we lost 90,000 jobs in san francisco. there was a recovery, but we never got back to 600,000 jobs. the first recovery from a recession we track at the chamber that did not get us more jobs than we had before the recession. will we have another jobless recovery at this recession? this city has more people living

in it than any time in the history of the city. 805,000 people in the last census, but we have 80,000 people less that work in san francisco than we did in 2000. there is something wrong here. this is not the time for this legislation. clearly, there are notice issues, communication issues, but you are throwing out the baby with the bath water when you're dealing with so many good employees -- [bell rings] supervisor campos: thank you, mr. lazarus. next speaker please. >> good morning, supervisors. i am with the chinese progressive association and progressive workers alliance. our main campaign we are working on right now is not health care. our main campaign is a campaign to end wage that wagetheft -- wage theft. we have been trying to educate workers on basic labor law

protections. we're doing our campaign because the fact that workers have wages stolen from them " as the economy. i wanted to acknowledge and thank all the members of the community, all the employers here today expressing their interest in providing health care coverage for employees, expressing their interest in protecting jobs and making sure that workers get employment, and invite all of you to join the progressive workers alliance in our work to increase enforcement of labor laws in san francisco as well as create jobs for san francisco workers. i also want to note that we are coming here with actually a very simple matter. everyone agrees that health care insurance is a week -- a good way to go and what employees to have access to health care. we are down to a very simple question -- do all businesses play by the same rules or do they not? if everyone in the room agrees workers should have health care

coverage, then we have to look at the facts. and% of businesses in san francisco are spinning out their money buying health insurance or paying healthy san francisco -- 90% of businesses in san francisco. by closing the loophole, that is how we even the playing field and make sure workers have access to health care. thank you. supervisor campos: thank you. next speaker please. >> i am a restaurant owner in san francisco, and i would like to address my remarks directly to some of the questions president chiu ask. i appreciate it. some of the questions you ask were really good. i would like to shed and on the ground business owner's light on those questions. we have an hra. we fully notify our employees. we provide any coverage that can be covered. dental, medical, so on and so

forth, but utilization rates are still low. president chiu ask the question about 20% compared to 55%. there may be an assumption that is incorrect. we are assuming all things are equal. in healthy san francisco, i believe these are people who sought out health care and applied for it because they knew they needed to access the health care system. in our hra's, utilization rates are lower -- nobody argues that young people never access health care, but young people dollar for dollar probably access health care a lot less than older people. i have a lot of young employees, and they are noticed about the hra, and simply do not use it as much. one thing you brought up that i would like to address -- the perpetuity of holding these liabilities on our balance sheets would be catastrophic. i got to try to find financing for my next unit, and i have tens of thousands or hundreds of thousands of liabilities on my balance sheet that will never be

redeemed or go anywhere. i'm not going to get financing. i'm not going to create jobs. if this passes, i will shut down one of my restaurants. there is no question about it. if it passes, my next unit -- i'm trying to save up here and there -- i can assure you, it will not be in san francisco. i will have to the oakland, san jose, berkeley -- i will have to go somewhere else because it is tough out there. the economy is hard. our margins are thin. we want to provide health care, but this is not the way to do it. supervisor campos: thank you. next speaker. >> could i ask for 10 more seconds? supervisor campos: next speaker. [applause] >> good morning, supervisors. i work at a small bookstore in the mission that employs 17 workers and has one employer. i want to thank you for this amendment. i am here at the behest of my employer. because numbers are so low at our business, my employer is not

required to provide health insurance, and yet, he does. he has provided health insurance for workers for the last 10 years fully. the only people who are not covered are people who have spousal coverage through their marriage. he feels it is a moral obligation to provide us with health care coverage, and it is part of his business plan. small business owners, do not give me this. it is doable. he also provides massage for us every two weeks, so that we do not get carpal tunnel syndrome because we are mostly a computer-based business. are we happy? are we motivated? are we productive? you bet your bippy, we are. i will conclude with a quotation from martin luther king, a

remark he made in connection with the civil rights laws that were passed in the mid-1960's. he said, "these lots will not change hearts, but they will change behavior, and perhaps sometimes, hearts will follow -- these laws will not change hearts." so i beg business owners, please pay your fair share. [applause] >> i am the executive director of the committee on jobs. let me first say that we support the health care security ordinance and believe that the program works. we also understand the concerns raised by supervisor campos. but we believe the current form of legislation will hurt the local economy, local businesses, and ultimately those who live and work in san francisco. in particular, it is clear that after a few conversations with local employers that the number of jobs lost will be significantly larger than what was reported today in the

economic report. the fact is that this measure would hit local businesses and their employees harder than any single tax increase proposed or adopted in san francisco in the past 20 years and would come at a worse time for employers in decades. in 2006, then supervisor ammiano said this was a way to increase employee access to health care services. he was right, and that is what the hcso has done. can it be improved? absolutely, but this is not the way to do it. san francisco does not operate in a vacuum. we have to compete with other businesses in the region and with the whole world. passing this legislation will continue to push costs higher and leave more san franciscans unemployed. health care policy is extremely important. yet, and even more complicated issue -- sweeping mandate should not be adopted in haste and without careful consideration of

the facts -- sweeping mandate should not be adopted in haste -- sweeping mandates should not be adopted in haste. we believe we can allow employees to enjoy the flexibility of these accounts. additionally, by providing employees more and better reminders, we will certainly see the increase in usage. with the city's economic recovery still in question -- [bell rings] supervisor campos: thank you, sir. next speaker. >> i am a registered nurse and member of seiu 1021. i want to talk briefly about the young person who has asthma who has no access to an inhaler and an antibiotic to the ends up with life-threatening pneumonia in the emergency room. there really are ways for this to work, but i have to tell you -- i am outrage that someone who lives in san francisco and paste that $2 and thinks it is really

going to health care -- i am outraged that someone who lives in san francisco and pays that $2 and thinks is going to health care and their argument against not going to closing the loophole is, "we swear we are not guilty of cheating, but in case we want to cheat in the future, we have to leave the loophole open." that does not make sense to me. i am in favor of this ordinance. it is unbelievable. i go to a restaurant and order lobster and they gave me a hamburger, i would be totally outraged. you are handing me a bill that says you paid for health care for someone, and then pocketed the money, and you need it as your private source for creative financing? i do not get it. thank you. supervisor campos: thank you. next speaker. >> i admit, you're so tired of hearing small businesses and restaurants being vilified -- i

am tired of hearing small businesses and restaurants being vilified. what a perfect example of what is wrong with this amendment. we have six stores. we have been here for 25 years. we have been a great san francisco citizen. we feed hospices. we feed the tenderloin after- school program. we tried to be a good citizen and try to treat our employees in a benevolent fashion. all our employees get health care from us, but if this amendment passes, the impact is a $200,000 a year cost. we have six stores. two make money, two break even, two lose money. it this amendment is enacted, we are a true example of job loss. we will close two stores, and 40 people will lose jobs. that stands in stark contrast with what was expressed here. we are 1 business where you will

lose 40 jobs right away from us. we are a prime example of what is wrong with this amendment. once again, i want to speak to the integrity of small businesses and restaurants that do business here and do it in the spirit of san francisco, which is a benign spirit. supervisor campos: thank you. next speaker. >> i am the executive director of the san francisco labor council. we represent over 100,000 men and women who do have health care because they have effective bargaining agreements, and we were extremely proud to be part of the team the past the san francisco health care security ordinance in the year 2006. it was a 15-month campaign, extremely difficult to move forward with this. there were lots of studies, and ultimately, as people have said, this passed unanimously. by the way, i want to thank president chiu for cosponsoring

the legislation, and thank you, david campos, for initiating it. the main piece we never anticipated what happened -- because healthy san francisco works -- tens of thousands of more people now have access to health care because of this wonderful legislation. we never ever thought that there was going to be the type of data that we are now seeing today. we have been monitoring this over the last five years to see how it works. we like to see if legislation works. when we found out that over 80% of the money that is supposed to be going into health care savings accounts was going back into the pockets of the employers, we thought there was something vitally wrong. so we fully support this amendment to this great legislation, and we are urging you to make sure this goes to the full board of supervisors at the next meeting. thank you.

supervisor campos: thank you. next speaker please. >> i am here with san francisco pride at work. the majority of our members are young people who work in san francisco, and i say the majority of them -- probably over 80% -- use healthy san francisco and otherwise would have no access to health care at all. when the legislation was originally passed, we never expected that the accounts would be used as a loophole for employers and by closing the loophole, we will be bringing the legislation in line with the original intention, which is to provide health care for everyone who works in san francisco that otherwise would have no access. this is really important to young lgbt people and the city, and thank you, campos, for introducing it. supervisor campos: thank you. next speaker. >> i am an elected officer with seiu local 1021, and i work at a nonprofit in the tenderloin.

over the last four years, we have suffered millions of cuts. we had deskilled our workers and reduce the availability of cyc beds. we have merged clinics and seen many layoffs. our public health system has been cut to the bone. we cannot allow anyone to continue to cheat the system. the taxpayer's burden is about $600 for every blood pressure check. several thousand dollars for every emergency room visit, and at least $1,000 for every camp -- every ambulance ride. the idea that young people do not need access to health care, in countries with cervical cancer among young women, who is primarily affect women in the 20's, is the second cause of death, in this country because of regular checkups, it is the 14th cause of death among women,

but those numbers go very high for women who are uninsured and do not have access to health care. in addition, the idea that young people do not need health care -- i do not know who you think there's children, but is usually young women. -- i do not know who you think bears children, but it is usually on women. it is very important that we close this loophole, moved in the intent of the original legislation, and i thank you for your leadership. thank you. supervisor campos: thank you. next speaker. >> supervisors, i am with seiu 1021. i was part of the team that worked to pass the legislation when it originally passed. i can tell you without hesitation, having actually sat in the room when it passed this specific provision that it was never intended to be abused in

this way. to reward bad actors seems wrong. leveling the playing field is the direction to go. i also just want to know, having sat through the hearings on the original legislation, the same arguments were made by almost the same people about job loss, how this is going to hurt businesses. as history has shown, supervisor ammiano was correct. the supervisors and the mayor's office, who were willing to be courageous around the most important issue that faces america today and being a leader on the most important issue was the right thing to do. history has shown that that was the correct course. by closing the loophole today, you will show again that san francisco is the leader on

health care and is willing to make sure that uninsured and those that are low-income have the kind of health care that they deserve. i just want to thank the board of supervisors for holding this hearing today and revisiting what is clearly a loophole that should never have been created. had we known, we would never have done this, and i am happy to see that you guys are doing the right thing today. supervisor campos: thank you. next speaker please. >> good afternoon. i have lived in san francisco for 59 years. i would like to make my comments from a different point you. with this health-care ordinance, obviously, this -- there is disagreement. one area that everyone should agree -- if the department of public health had administered the different older programs more efficiently instead of

wasting money, then we would not be in such a bad state of affairs. i admit that i am not fluent on these items, but one thing i am fluid is that if our agencies were to use the money more effectively and with less waste, we would not be here arguing for over two and a half hours about one particular loophole -- one thing i am fluent on. one has to take a realistic point of view. if you are a businessman in san francisco, it is pretty clear that no matter how big of a heart you have, you cannot take care of everyone in every way you want to. it is kind of like the homeless problem. you take care of 100, there will be 200 more. you take care of 200, there will be 300 more. that is why a lot of my colleagues in different parts of the country actually congratulate me and say, "san

francisco, you are doing a hell of a job solving problems for us in the east, the north, and the south. keep it up. you have such a big heart. we are glad we do not live in san francisco." my final piece of advice is no matter how much we want to help everyone, we have to be realistic. we cannot solve everyone's problems. it is better to teach them to solve them themselves. supervisor campos: thank you. next speaker please. >> good evening. i am from the golden gate restaurant association. i am here today to talk about what i think is a way forward that will address the issues that have been raised, without the negative economic impact we have also heard today. one of the things that people have said -- and i think we need to clarify -- there's a, that

keeps being said that there is not access -- there is a comment that keeps being said that there is not access. the purpose of the legislation when it was originally drafted was trying to create health access so that people did not first access health care at the emergency room. that was the design of the program. a reimbursement account does that. provides for reimbursement for going to doctors, for going to the clinic. provides the level of health access, which is what the program was designed to do. however, if employees do not know about that benefit, then they cannot take advantage of it, and it undermines the intent of the law. we strongly believe that a mandate regarding notice would be appropriate. it could be a quarterly notice. it could be one that discusses how much of the benefit the employee has, how much they could accrue at the current rate

over the course of the year, how the employee can access that benefit, and list the eligible expenses that they can be reimbursed for all on the notice to the employee. in addition, if we believe that there are bad actors and employers so limiting their program that they are not usable, we should require under penalty of perjury a request as to what benefits are eligible under these reimbursement accounts. then we have information we could act on -- [bell rings] supervisor campos: thank you. is there any member of the public who has not spoken who would like to speak? please come forward. >> good afternoon, supervisors. i have been affiliated with restaurants for about 25 years. i think the legislation was well intended and was written with

passion and care. however, although it is intended to solve a problem, a local, in fact, it will create another problem. restaurants operate on a 3% margin right now if you do everything right. with the 3% margin, with all the other mandates pushed on this restaurant shares -- restauranteurs, eventually, a straw will break the camel's back here right now, there's a lot of restaurants -- a straw will break the camel's back. right now, there is a lot of restaurants and about 500 close every year. right now, what you are seeing is people are failing, and there

is no cushion. there is no money. 95% of us are struggling. 5% of us seem to be doing fine. if we are all put out of business, no one will have any benefits. >> i am with the san francisco labor counsel and as the wife of a restaurant worker. i am to speak on behalf of closing the loophole in the legislation because i think it is critical to the intent of the law, which was to cover employees with health care, and that is not happening. most of the restaurants are doing the right thing, and they should be applauded for that. some of those who are administering hra's are letting the employees know, helping them access this, but they are a minority.

an important minority who are not. these employees are not given notice. it is not about notice. it is about the intent of the law. if we have a large percentage of that money being taken away from employees, that means they are not able to access health care. they are not able to cover prescription medication because of those stringent requirements that are absolutely ridiculous. and young people do get sick. we do need access to health care. we do need preventative care. we have heard restaurant owners time after time say that they agree with it. we had a restaurant owner talk about how covering her employees is good business sense. i think people are failing, as the previous speaker said, and it is not just employers. it is definitely employees as well. i think it is critical that we close this loophole. the hra's are not working as

currently presented, and i thank you for your time. supervisor campos: thank you. is there any other member of the public who has not spoken who would like to speak? seeing none, public comment is closed. again, thank you to everyone on both sides of the issue has spoken about this. i know that president chiu and i know supervisor farrell -- ashley, he is on the rules committee, which is starting now -- actually, he is on the rules committee, which is starting now. i do not want to belabor this, but one thing that is important going forward is that we had a discussion about the legal parameters we have, and i think that is something that should have been appropriately at the board of supervisors so that the entirety of the board can hear in a closed session some of the legal issues implicated, so with that in mind, i make a move that we forward this without a recommendation to the full board. supervisor farrell.

supervisor farrell: thank you, supervisor, and thank you to everyone who came out today on both sides of the aisle. obviously a contentious issue. to say my piece about it now, i do have a lot of issues with how this has been implemented, and things that are probably unintended consequences. some people came up and spoke about going to a restaurant to pay 3% or 4% or 5% fee, and understand now that it is not necessarily going to health care. i think that should drive everyone nuts. the fact that there are potentially incentives or disincentives to reimburse people -- it does bother me a great deal. i am move by the notion of leveling the playing field in the employer community -- i am moved. but whatever industry they may be on -- despite whatever industry they may be on.