always followed the law and everyone gets their quarterly notices, i do not restrict, and only 30% of my money is gone. there must be something wrong. supervisor campos: i have a few more names. [reading names] >> good morning, supervisors. our employees do have hra accounts. we do not have a use it or lose it provision. the balance accumulates year over year. they receive quarterly notices, they make special accommodations for the employee to access their hra account. i have never had any complaints about getting reimbursements. however, i oppose the amendment to this ordinance as written for the following reasons. the cost of administration has

not been calculated yet. it is impossible -- at least i cannot figure out how small businesses will comply with tracking employee's accounts after they have left the company. it is a burden that will become increasingly expensive over time and will provide very little benefit. the second part of the amendment is that the care expenditures have to be available within five days after the end of the quarter. the administration of the hcso is extremely burdensome within a small business. we can are they calculate our debt to our employees within that five days and then get it off to the third-party administrator, who absolutely cannot turn it around in that timeframe.

it will be impossible to comply with that aspect of the amendment. for those two reasons, i oppose the amendment as it is written. supervisor campos: thank you. next speaker please. >> my name is beth carey. i work for a temporary home care agency. we provide hra's to our employees using a third party. a small percentage of our employees actually use it. what i want to say is, this issue is also about the health care of our seniors. our biggest competition -- this is not a level playing field because our biggest competition our domestic referral agencies. instead of hiring employees, they hire independent contractors. they do not pay taxes, they do not pay workers' comp, they do not pay insurance.

they did not supervise their employees because they do not have any. their employees are independent contractors. that means that this is giving an incentive to people to pay independent contractors, who are not supervised, or people who advertise on craigslist, because the cost is lower. we cannot recruit this cost -- recoup this cost because that would put us at a huge competitive disadvantage. we need to figure out a way to put domestic staffing into consideration -- in this proposal. if there is a way to close that loophole -- because i feel like this bill is giving an incentive to people who are not doing the right thing.

you guys are talking. can i have more time? supervisor campos: finish your statement, please. >> this is already not a level playing field. closing this loophole for us will make it even less of a playing field because we have other competitors not paying insurance. supervisor campos: thank you. next speaker please. >> i am ruthie norton. me and my assessment provided to some information. we provide services to many small and midsize companies in san francisco, and we are concerned about the added burden that this will impose on businesses. these changes are of special concern when we are in a hurting the economy and businesses are struggling to stay afloat. the bay area offers lots of retail opportunities beyond san

francisco. any unused funds in an employee account must carry over year to year and be were available to the employer, spouse, a family member. what happens when an employee is terminated? this would be subject to cobra, which means an employer must make and minimum contribution. any plan changes must comply with the regulations. if you take the choices out of the plan the election, it may not qualify under kroeber or the irs. this may impact industry that have high turnover. any employee that works eight hours or more per week will be able to accrue hcso and discourage any casual employers.

this is what they what. focus on enforcing the current plan. the enforce the provision now is limited to receiving a corrective review. was supporting evidence necessitates any change? this is an administrative nightmare. supervisor campos: thank you very much. [reading names] >> i am the owner of a staffing service called the people connection. we also had an hra. i am surprised that we are talking about an amendment when there is a minority of people that have abused this. we follow the hra.

it is in the employee handbook. they are given time to use it. after they terminate with us, they get 90 days to use the funds. those funds are readily available for all of our employees. the majority of our employees, after they leave us, go to a full-time position. in effect, my employees leave us and they will be double dipping. this amendment is unfair to us who have complied and have the good spirit of the hra. supervisor campos: thank you. next speaker please. >> my name is adam levin. i run several pizza parlors in the city. we cannot pass on any of the health care costs in additional fees. just an example of one store that does not make enough to pass on -- to take on additional expenses.

one-third of the crew is full time, two-thirds is part time. in the past, before the city passed its mandate, full-time employees got health insurance, dental, paid time off as a benefit. we spend about $250,000 for our crew. then the city passed its own minimum-wage and paid time off. that added $30,000 to our cost. most of that money went to the part-time employees, the tipped employees. full-time employees were already making more and had benefits. then the city passed health care benefits. without the hra option, it will cost another $25,000. with the hra, which i use for part-time employees, we were able to manage that at a considerably lower number.

now the city wants to change that. the benefit will go to the part- time employees who have used much less than is available so far. the cost would go up with all of the ordinances from the city, paid time off, minimum-wage, $50,000. we just cannot do it. it is a high wage, low profit business. the odds are, if the amendment passes, a store will have to close. instead of giving a benefit, 30 people will lose jobs, i will not pay a business tax, license fee, i will not pay property tax, there will tax, or registration fee. supervisor campos: thank you. i have a few more names. >> good afternoon.

i have worked in san francisco for over a year. i was hired at a restaurant in the embarcadero. i worked there for over 11 years. it was mentioned that we would have health insurance after three months of employment. after three months, it never happened. i know the restaurant charges a percentage for healthy san francisco to their customers. i know people are very happy to pay that because there are good intentions with the program. i am here to support the loophole about healthy san francisco. i also need to mention, at this time, the restaurant charging 4% to customers, that money, i

think, went to the owner's pockets. instead, that money is going to the pockets of one person instead of the everyone. i have documents to prove that the rest from made over $2 million. just do the math. supervisor campos: thank you. next speaker please. >> director of the office of small business. at the small business commission, you have the commission's response in your packet. we are not recommending -- the commission is not recommending approval, but does recommend the

fact that the needs to be strengthening in notifications. we checked with our city attorney. the city can require employers to provide some regular noticing of these hra accounts. a particular note i want to draw to your attention, on paragraph 4 of the commission's response, many of these businesses are using the hra account to deal with their part-time employers. the unused funds are actually helping to supplement their ability to pay their full time worker's health care costs. two weeks ago, in the paper, there was an article with kaiser, who is raising their rates to 300,000 policies which are administered through small businesses. i think we need to keep in consideration the fact that as our small businesses -- ideally,

they would like to provide health care. insurance companies are not making it easy. the health care reimbursement accounts is allowing them to balance that out. healthy san francisco and the san francisco health plan, they actively inform the employees who have the medical reimbursement accounts. they are averaging a 55% response rate. this is with active notification. for employees whose policies have gone dormant, left their jobs, the health plan does extensive outreach. they have seen their employers have not responded, have not collected on their medical reimbursement account. as tendering noted in the commission meeting, there has been approximately $3 million that employees did not ask for

reimbursement, that have gone into healthy san francisco. the commission's question is, if we use the san francisco health plan as an example of a percentage, that 45% -- if these medical of reimbursement accounts, if employers are not able to use it -- that money is going to sit somewhere. through the san francisco health plan, it has been demonstrated that not all employees access that medical reimbursement account, even though they are actively informed of the money and policy. the commission supports stronger enforcement requirements for notification. the other amendment, that this is not thought out well enough, the intention -- the

achievements that it is going to insure. it is going to cover the health costs that the city is incurring. we need to ba throwback to the drawing board on that. supervisor campos: supervisor campos: thank you very much. one of the reasons we asked mr. goldberg to do a brief presentation on how the health care security organs works and how that differs from help the san francisco is because it became very clear in the main, and that commissioners made that there was a real lack of understanding of how the law works. that is one of the reasons why we wanted to provide some context. because the comments and statements really do not align with the reality of how the actual ordinance covers. >> i just wanted to thank you on your willingness to spend so much time on an issue that

should be taken care of quickly. i am a rabbi in san francisco. i began my career 42 years ago as a chapel in the united states air force, spending t a beale years in southeast asia. i address you today not as a rabbi. i am a strong believer in the separation of church and state. i want to speak to you as a resident of our great city and as a customer at a restaurant, and i want to tell you that i feel deceived. i was so proud when i first learned that a portion of the bill that i am paying is going to health care for workers. 21 and a half years ago, i was diagnosed with lymphoma. chemotherapy, stem cell, transplant, the works. today, i go every year. medicare gets billed $11,000

every single month. i know the value of health care. and i feel deceived because what i thought was such a good moral, ethical thing is not being carried out the way in everyone i know who is aware of this believes their money is going to. i do not want to speak as a rabbi, but i will tell you that my tradition teaches -- do not put a stumbling block before the blind. we are blindly walking into the restaurant, and i think a police are also blind when they think they are getting a fund for health care and they are not. i hope you do what i think is the right thing. supervisor campos: thank you. next speaker. >> i am with health access california, and i wanted to address the rollover issue, which has not been addressed yet. the issue is that the ordinance

currently does not require hra's to have a rollover ability. i would submit to you that that is an essential issue addressed by the amendment, and that would not be addressed by other forms of solutions. first of all, only 10% of hra's nationally do not have a rollover capacity. this is really an allied air. on the front end, the reason to allow funds to roll over from year to year is the prevention issue. the fact that employees are not currently using the hra's is not a good argument. fact is that the national health care reform debate was fundamentally about moving towards a culture of coverage, a culture of prevention and primary care. people who are not used to having health insurance and young people used to being healthy do not tend to see primary and preventive care. it is no more a reason to stop providing them access to that care than when the city started

to do recycling and people were not feeling their bins -- not filling their bins. you do a mass of publication effort -- a massive public education effort to normalize the behavior. on the back end, the reason we need the rollover is the medical debt issue. medical debt is a huge and growing issue in this country. bankruptcies in california went up 14% in 2010 alone. we are now at 1.5 million bankruptcy's in the state per year, and we know that approximately 2/3 of those relate to medical debt. young people in particular, those who work in these restaurants -- they may not have care on the front end, but when they have a hospital bill, they should need to have money accumulated in the account on the back in. supervisor campos: thank you.

i have a couple more speaker cards. >> i am a restaurant owner in san francisco, and we use the hra program. we are fully in compliance. we do allow rollover year after year. 80% of our employees have been with us for more than three years and have been happy and since this health care act has come into play, had used the services and the funds. 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