of the ship and them in one of them, because there is a new fine or feet. >> one of the changes and paid seven was based on the change as we understand it. >> that is correct. one thing that i forgot to add, i noticed, as in the stand it, the mayor's office is supportive of this legislation. >> thank you.

i thought that i would take a moment to thank members of the community and advocates. in helping to craft this legislation. i wanted to thank the supervisors for taking control on this issue. we know that this has been an issue that has gone on for decades and it has been a very challenging issue. particularly as our own communities that are and forcing civil rights issues within our own communities and challenging, especially dealing with sensitive issues around class and immigration status and a variety of other things, i think that this legislation will help to enforce the city's ability to control minimum-wage in neighborhoods and

communities. i wanted to particularly thank all of the members. i know that this legislation has been community driven and i am more than happy to support these efforts. thank you. supervisor chu: thank you. supervisor mirkarimi: madam chair, i wanted to add to the chorus, as i co-sponsored this. community driven, rallying around the great work of the office of labor standards and enforcement. i believe that they are stretched beyond their abilities and they continue to try to make the workers and the city crowd in their aim to make sure that people are fairly treated. what concerns me the most and why i like this legislation a great deal, sometimes san francisco has a reputation that

we do not always live up to. and i always believe that that reputation eclipses and cheats immigrant communities in san francisco where those who are preyed upon and made vulnerable are not benefiting from the kinds of laws that others take for granted because they are the laws that are unique to san francisco. as it applies to immigrant communities and low-wage workers in particular, this important correction in enforcement standards earnings san francisco that particular reputation. it would make sense for other cities to take note. i think that it backs up our intent. i am very happy to support this.

supervisor chu: i see that the city attorney is here. i will ask them to take in the substantive amendment. >> these changes are substantive and would require continuance to allow for additional public comments. supervisor chu: do we have a motion to continue the item? supervisor mirkarimi: it should be continued. supervisor chu: members of the public, we want to thank you for coming out today on this important topic. many years ago my parents immigrated to the united states as well. they worked in chinatown, the restaurant industry, and many low-wage jobs. i can certainly understand the

challenges that arise from those situations. for me i think the process of this legislation was not so much the intent and supporting the intent, it was whether or not we could accomplish this through the city and making sure that there was something we could do here operationally. i look forward to supporting the legislation. if we could do that without objection? thank you. item number two, please. >> item #two. resolution approving the san francisco unified school district expenditure plan for the public education enrichment fund for fy2011-2012. supervisor chu: this item comes to us from the budget and

finance committee. the legislation's reza -- legislation included language that affected references to different organizations. although we may be amendment at the full board of supervisors, we sent it back to committee to allow for additional public comments. let's wait for the room to clear. [no audio] supervisor chu: thank you.

let's open this item for public comment. are there any members of the public that wish to speak on item number two? seeing no one, public comment is closed. colleagues, this item has been before us before and reflects certain changes for the unified school district. can we move forward without objection? we will take a motion to move this to the full board without objection. item number three? >> item #3. resolution approving and authorizing the execution of modification no. 6 of the 1981 airline-airport lease and use agreement l82-0316 with continental airlines, inc., to provide a retroactive rent credit for terminal rent of exclusive use space vacated in terminal no. 1 due to the merger of united air lines, inc., and continental airlines, inc., at the san francisco international airport.

item #4. resolution approving and authorizing the execution of modification no. 1 of the 2011 lease and use agreement l10-0275 with continental airlines, inc., to modify the demised premises by elimination of all exclusive use space in terminal no. 1 due to the merger of united air lines, inc., and continental airlines, inc., at the san francisco international airport. supervisor chu: thank you very much. we have cathy wagner from the airport. >> good morning. the airport is seeking your approval to modify two items in order to consolidate space as a

result of the airline merger with united. the first before you would approve an authorized modification to the 1981 air poured airline lease agreement provided retroactive rent credit for the month of june, 2011, for the terminal rental of continental's exclusive state -- space. the cost is $430,000. the second proposed resolution would authorize an improved modification #6 to the lease agreement. by eliminating all of continental's exclusive space, approximately 37,000 square feet in the first terminal. as of june, 2011, merged operations between united and continental take place at terminal 3.

continental is requesting modifications rather than outright termination. the newly merged airline awaits faa operation certificates. the airline will continue to pay all landing fees under modification and the budget analyst has recommended approval and will be happy to answer any questions. >> thank you. -- supervisor chu: thank you. mr. rose? >> members of the committee, page 5 of the report, we have a table that shows, if you approve these resolutions, it would result in $39.8 million in total potential lost revenue. as you know, this would not impact the airport's budget. we recommend that you approve the resolutions. supervisor chu: let's open this

up for public comment. with any members of the public like to speak on items three or four? seeing no one, public comment is closed. colleagues? we have a motion to send item 3 and 4 to the full board with recommendation. and we do have a second. item number five, please. >> item #5. resolution approving amendment one to the agreement for advertising on san francisco municipal transportation agency property between the city and titan outdoor, llc, to allow advertising window wraps on up to 5% of the san francisco municipal transportation agency's buses and up to 10% of the san francisco municipal transportation agency's light rail vehicles and to change the approval requirements for advertising in parking garages. supervisor chu: thank you very much. >> good morning, supervisors. to put this item in context, a

couple of statements. this agreement was put at the request of the mta, and not through tighten. we have requested this as a way to address the budget deficit in the 2012 budget cycle. we were trying to close a budget gap and develop ways to close that gap and had determined that one of the ways would be to enhance advertising. in the budget we had put $500,000 in for advertising revenue we came before you one year ago at this time and it was tabled, we were asked to go back to the titan institute. we have gone back and it has been indicated that it was not put in. we continue to believe that it is a bad idea for the mta.

the contract is already over for this fiscal year. we believe that every dollar that we can get, we will get over 65% of that. if you experience incremental revenue it will address budget means this year. we are already projecting a $22 million deficit this year. the other point that i wanted to point out, you people also have concerns about approving this and it will be approved based on a contingency that there is a view for annual review on two issues. one, what is the feedback? two, how much revenue are you getting? especially if there is revenue from other sources. those of the two items. to the extent that we were not

getting additional revenues, we would not continue this program. amending the agreement on an annual review basis helps with the budget deficit so that we do not have to do things like cut service, avoiding the service issues of the past couple of years. we understand that there are concerns about this not being with merit. unfortunately, we will not be getting incremental revenue because there is so much over for the fiscal year already. we are open to answering any questions you have. supervisor chu: just a quick question for me.

in terms of the annual increase that occurs, 65% of revenue overall, the committee had asked the mta to go back to estimate the value of wrapping around the windows, half of a million dollars. >> that was the request, yes. >> -- supervisor chu: logically, what was the rationale around not providing any? >> this would be a question for the mta to address in the deficit. they do not know what the market looks like at this point. the advertising market has not been stable for the past couple

of years. in attempting to get incremental revenues, they were not willing to revisit the underlying agreement. supervisor kimsupervisor chu: wo the projected deficit, how have they been progressing at the board? >> this estimate was presented several months ago before the budget started. now i think, a supervisor, everyone is aware that almost every year the mta has similar deficits. we do things informally, like not buying parts or materials.

making the formal revenue increases and cuts to the budget, there has always been a deficit. adding to the random service revenue that we have, which frustrates others. i am hoping that we do not do this again this year. supervisor chu: when we do get passed the budget, what was the change that occurred that led to the deficit? , >> one of the items was a garage ordinance to enforce pricing.

unfortunately, and additionally, revenues in the reduction as budgeted, $500,000, something that you will not get it is not improved. the third area is the service to the system. more costly than we thought it would. services adding back to the incremental costs. supervisor chu: i do look forward to the update on the balancing plans for the coming year.

>> this states that tighten did not request this. it seemed that tightened its this both ways. on the one hand they are independently stating that there will be an additional $500,000. but they do not want to put it in the minimum annual guaranteed because they say the economy is on certain. so, there is no certainty. by approving this piece of legislation, they would pay no guaranteed consideration for being able to wrap the windows, even though the mta shows -- i see this as a win-win for a tight upon. there is no certainty that we would get the additional revenues. as you know, there are all kinds of revenues. when you take that much on each facility, there is absolutely no

tie in that they will keep track of this. they could wind up with more money. absolutely minimal revenue from this. we are stating that it should be in the minimum. or, at least, some portion of that $500,000. that is why the community did go back with this item. as mr. ford's memo states in the report on page 12, they refuse to put that in the guarantee. the characterization was that titan did not really what this. that it was the mta that wanted

this. on the bottom of page 8, under the proposed cut, the m.t.a. would receive no guarantee of any additional revenues from the titan outdoor. i am specifically talking about the $5,000 in the minimum annual guaranteed. supervisor chu: thank you. supervisor mirkarimi: to the chair, to mr. roh's, you mentioned -- i am trying to qualify this a bit more -- they resist the annual minimum guaranteed because of the uncertainty of the economy. providing more uncertainty to that the economy.

>> right now, under this existing agreement, they are paying 65% of gross revenues. it is a five-year contract. they had been exceeding, but in this particular case you would be providing the titan outdoor with wrap the windows and they would guarantee no additional compensation to me. i do not think that that is a fair compensation for the city. supervisor chu: thank you. i am wondering if you can follow up.

i do not know that the statement that they will not be providing revenue is accurate. kenny you explain that a bit? -- can you explain that a bit? >> i believe that this is the case, they will proceed as they have through fiscal year 2012 because of how they have in 2011. this, we believe, will be incremental and automatically increasing to 65%. what the budget analyst is increased -- indicating is that the dollar will get to 65%. as we have demonstrated this past fiscal year. we believe that the mag will be reached. the budget analyst was indicating that in a situation where we do not hit it, internal

revenue in that case would be correct, but we do not believe that to be the case. supervisor chu: with regards to the history and track record of payment to the mta, in recent years has been trending that we are receiving just a mag? or are we getting more? >> as you know, this is a new contract. they have exceeded it every two years. titan has been very aggressive. we are actually now getting more than a mag. we are pretty happy with their performance.

given that it -- supervisor chu: given that we have seen two years of revenue data, we saw the calculation of what was owed to us as not being a minimal guarantee. >> correct. they have hit the plus. supervisor chu: thank you. are there members of the public that wish to speak on this item? item number five? seeing no one, public comment this flows. colleagues, do we have a motion on this item? thoughts? >> my vision is not that they are going to see the minimal guarantee at all.

my position is that they are so confident, they are exceeding the minimum guarantee, why would they say they could generate $500,000 from muni without providing it in the minimum guarantee. it is not that they will not get additional revenues. i would be glad to respond to any questions. supervisor kim: this is a question for [unintelligible] to get better understanding of the incentives for titan, if they were able to get the win, would they be charging additional amounts?

or is it possible that they would not charge more, but they would have access to the windows? >> the market values covering the whole vehicle. basically, you have a moving advertisement on the streets that brings a lot of interest. we actually get incremental revenue above. the premium for that is incrementally much more. it is a much more prized advertising venue. a couple of years ago we had apple, movie cameras, giving almost $200,000 for wrapping

just one. because the premium market is so much higher. supervisor kim: is the concern that companies may not want to do the entire rap? or is the concern that they would charge more to wrap the windows? i guess i am trying to figure out if there is any way that tighten would sell the entire rap at the same price that they do without the windows. >> we do not know how they sell the ads or the price that they charge. we are clear that advertisements the cover the entire vehicle have a much higher value.

so, what titan is saying to us is that we know we have more money for you, we just do not know how much. because the market is rebounding now. because there is an annual review process, they do not want to put the number in. they would much rather continue under the current contract. we are trying to get this in place so that we can get the premium for 65%. supervisor kim: companies that want to advertise, the concern is that they will not want the full wrath of? or that they will pay less? >> they wantedad