commissioner kim: i will after public comment. commisioner wiener: we will open this up to public comment down. if there is any member of the public that might to comment on this item, please line up at the lectern. >> good morning, commissioners. you heard my remarks was weak. i will keep these brief. we are obviously interested in moving second straight forward for everyone's interests, bicycles, pedestrian, transit, and otherwise. i look forward to reviewing the memo that mta and public works has put together, to see the details on how this will move forward. is good to know there is funding at hand, a plan to go back up to find more funding for planning. prop aa, the one bay area grant -- of course, the one bay area grant we are expecting this spring is basically the second

cycle of the first cycle that put money on this project and we are now moving over to other projects. i think we all look forward to doing a better job this time with that cma block grant. prop b, obviously something should be looking at as a source of funding. that takes into the point that i've already made, and let me reiterate. the bison coalition is strong believers in complete street as a philosophy. the outcomes are beautiful, but how you get there is quite difficult, because it is about cooperation and communication and public agencies working together with public. not very sexy, fun, but yet, about that, things do not turn out well. as we look at the prop b streetscape money, we are keen to get the agencies together with the public to talk about this, so we put together a wonderful projects that benefit everyone interests and come in on time.

projects the we're all very proud of. let us not only be commended execute well on communicating and collaborating, and we will have a beautiful second street, and we will all be very proud of it. thank you. commisioner wiener: thank you. next speaker. >> good morning. my name is catherine webster. i am a resident at the corner of second and kenya. i am also the vice-president of the south beach business association. i am thrilled to hear the funding has been allocated and we just want to convey how important the second street plan is to us, how it can help improve the safety of pedestrians and congestion, in particular, as well as repaving,

which is much needed. it is extremely important to us. we want to work closely with the mta and dpw to ensure the project does get done in a timely manner. again, this is extremely important to us. we look forward -- i know we still have to work through some of the bicycle plans, but we look forward to working with everybody on that, all of the agencies and the bike coalition. please know that we look forward to having you come to our association and work closely with you to make sure that this does get done in a timely manner. commisioner wiener: thank you. next speaker. >> my name is ramon smith. i am the district 66

representative. i am here to say it is good news today for me to go back and tell organizations and advocates i work with that funds will be made available for this much needed project on second street. it is with discipline that it is not the state for it can move forward, but it is very refreshing and assuring to hear you say today that the product will be developed and will move forward. i urge you, as supervisor kim will tell you, please include my name when you start doing the out reach. i will be happy to do what i can to make sure the message is out and people are present to make their concerns known. thank you and good luck with the project. the community at large will be watching closely. commisioner wiener: thank you. next speaker. >> walk san francisco. we have a number of important product before us. cesar chavez improvement project. that is something the committee

has been looking forward to, as well as the haight and market street project, second street, again, something that the community had been looking to see implemented for a number of years. this is not about picking one product over another. however, i do think there is a contract, if you will, between public agencies and the public. when the public is promised something, such as pedestrian safety, walk ability improvements, that those improvements are made. i want to emphasize it is important. we realize we are where we are. this transfer has to be made, but it is important that the city deliver for the residents along the second street corridor and the ring conde, south beach, mission bay, down town neighborhoods.

commisioner wiener: thank you. are there any other additional public comment jurors? seeing none, public comment is closed. colleagues, is there any final discussion around item 2? seeing none -- supervisor kim. commissioner kim: i appreciate the efforts of everyone has made to come together on the second street corridor. still unsure how this happened, the communication breakdown. i have long been concerned about pedestrian safety management, especially under multiple developments -- departments. i hope we can work better to make these products move forward. i appreciate the earnestness of many individuals committed to this project on the work they have done. i understand the delays.

we cannot expect everything, the community to love all our work, but our office is happy to engage on those issues. we will probably doing more regular check-ins on a variety of these projects. i did have an opportunity -- it is hard to be angry on and a such as today. we had an important victory over the decision over proposition 8. i just want to congratulate our city and community over that. i am looking forward to the reprogramming of these funds. cesar chavez and the markets/ haight street transfer is important, and happy to move this forward. commisioner wiener: see no other names on the roster, please call role. -- roll. >> [roll call]

the item passes. commisioner wiener: my apologies. i did not ask for a second. could we move without objection, rescind that boat? without objection. -- vote? commissioner kim has made a motion. , 2nd by david chiu. please call the roll. -- second by david chiu. >> [roll call] commisioner wiener: the item passes.

-- >> the item passes. commisioner wiener: introduction of new items. are there any items? is there anyone from the public that would like to comment on this item? seeing none, public comment is closed. item four, general public comment. anything within the jurisdiction of the transportation authority. is there any public comment? seeing none, public comment is closed. are there any other items on the agenda? we are concerneadjourned.

supervisor chu: welcome to the regular meeting of the budget and finance committee. i am joined by supervisor avalos and supervisor kim. our court today is victor young. mr. young, you have any announcements? >> please turn off all cell phones. if you wish to speak during public comment, please provide a card. items approved today will appear on the agenda for the board of supervisors.

item number one, resolution authorizing the exercise of a five-year option to extend the lease of space at 1740 folsom street for the share of -- sheriff's department. supervisor chu: thank you. >> ok. good afternoon. i and the acting director of real estate, i am joined by maureen gannon. the property before you under lease is 1740 folsom. i have on the overhead a shot of the property on folsom. with parking adjacent.

you can see where it is just south of the freeway. a look of the configuration of the property, because of the unique nature, you concede the frontage where the building is and the parking that lies in the long dated portion of the -- elongated portion of the l. this is a five-year lease extension for the property of the shareeriff's department. the current term expires in june of 2012. the current rate paid is $23 per square foot per year. everything is delivered with that raged except for electricity. the new rates that we have

negotiated is $25.18 per square foot. that escalates $1 per square foot per year for the remainder of the lease. in comparison to the market, here is a quick chart on the overhead for you. you concede that this compares favorably with those in the area. some of which are probably better class office buildings. it is a clear indication of a very willing landlord to work with us on the terms and conditions of the lease. supervisor chu: in terms of the document, which could not see it really. could you articulate the comparison? >> collected 1550 bryant, to hundred make utah, and the fox plaza that is not far away. in terms of the office uses, you

could see we are in the upper 20s and upper 30s per square foot per year. again, very favorable to become parables -- the comparables. lastly, i want to mention what we are doing out of the property. at the sheriff's department conducts training for defensive tactics, policy and procedure training. this property serves as the primary department operating procedure, so it has in the emergency rule, and the -- so it has an emergency role. it serves that purpose very well. additionally, there are standards for training and correction done by annually out of this property. the property is just over 18,000

square feet. there was a typographical error in the -- ithe correct number does not affect the base rate or the terms in front of you today for consideration. we are available for any questions you might have about the property. supervisor chu: in terms of the comparables, were they inclusive of utilities? >> that is an apples to apples comparison. yes. supervisor chu: why don't we go to the budget analyst report. >> on page 3 of the report, we point out that it is shown in the table the annual rent under the proposed lease option, it

would be $25.18 a year, that represents an increase of $41,119 from the current rent of $23 a square foot. we also point out that if you look at the table on page 3, the cost of the rent and utilities would be 2 million over the five-year period. supervisor chu: thank you. why don't we open this item up for public comment. whether any members of the public that wish to speak on item number one? >> good afternoon, budget and

finance. ♪ the sheriff time, give it the dime miracles made real on lonely nights, they know just how you feel when the budget sings, i forget everything ♪ ♪ the money you bring, yeah when the budget sings ♪ supervisor chu: thank you. >> good afternoon, and i have lived there for 59 years. i like to speak in favor of this resolution. i think it is necessary to show support for the sheriff's department. i noted he had a big smile on his face of this afternoon.

i think that keeping this building is good for the citizens because we know that the sheriff's department will continue to operate efficiently. i of the budget analyst mentioned of the increase was 9%. i am wondering, given the status of how things go, it seems a bit high. as he says, it is a unique building 80 can't quibble over every detail. i think it is a noteworthy thing in the department's needs all the support it can get, especially these days. supervisor chu: are there other members of the public that wish to speak on item number one? supervisor kim: thank you. this is just a question in regard to the budget analyst

report to the real estate. just a larger question, i know that it did not make sense for us to look out purchasing a small or medium-sized building. what is the policy, what do we look at when determining how the purchase makes more sense? we know that we are going to have to continue for this type of use. >> in 2006-2007, when the first increase in rent was about to come into play, we did have significant discussions with the owner about possibly buying this asset. when we compare those numbers of debt service as well as the existing expenses, the city would bear the landlord -- and the numbers did not equate to a point where a purchase made

sense. continuing to lease made sense at that time. we maintained purchase prices at about $6 million at that time. the rent has escalated the little bit since then. it is not necessarily on the market, and it would be a little bit higher. those numbers are about the same point where we are at a break- even spot. it doesn't take into account what we need the lookout in terms of capital reserve. a 50-year-old building here. it means we should be setting aside adequate funding for rentals and placements of major systems within the building. we have to look at it as a comparison to leasing. i would also like to know too that the reason for that large increase in the first year is because of the unique nature of the 10-year agreement that had a five-year increase.

we are paying the same rate today in 2012 that we were paying in 2007. that is why the first year looks extreme. his is a catch up over five years. we did fairly well. supervisor kim: because we do have surplus property, and l. not all of the buildings are appropriate for this use, but was that export as well? >> yes, we have done, i think, a pretty good job. there are a few surplus properties. nothing of the size and scale, and not of the robust nature the concerns the department operating center. supervisor chu: the item is before us. supervisor avalos: motion to approve with recommendation.

supervisor chu: we will do that without objection. >> can i make clerical corrections that they mentioned? supervisor chu: will you be requiring additional animation from the department? not just changing the number -- >> just changing the number. item two, authorizing the general manager to execute and limit the architectural engineering design service agreement to the new san francisco public utilities project located at 525 golden gate avenue. supervisor chu: we have representatives from dpw as well as puc. >> good afternoon, i'm with the

project manager from dpw on behalf of the public utilities commission. the item before you, this is an exciting building that embodies the city posed a great initiative and the commitment to those goals. it would be one of the greatest government buildings and will set an example for others to follow. we're already seeing immense interest by both public and private sectors as we are approaching the completion of the project. i am happy to report the building is expected to be completed in june, ahead of schedule. with the recommendation for approval, i will be glad answer any questions you have regarding this item. the joint-venture contract will

be funded in the project's contingency funds. the project budget will not change due to this request. i am available for any questions you might have. supervisor chu: supervisor kim? supervisor kim: can you just go over the increases? what the increase will cover? >> design changes implemented during the design phase and construction. and also the number of fte's required for the administration face. supervisor kim: can you explain why that needs to take place? why we need to make design changes to the improved and biological waste water technologies? >> i will address home of the design side and the construction. -- but both the design side and

the construction. we were introduced to what was called a living machine, essentially of biological wetlands system that treats water. given the core services are to provide power, water, and waste water, we thought this would be an important example to incorporate into the project. it is essentially three planters that use the wetland system. there were other changes that were required during the design as it was progressing, and construction have started about halfway through the design, implementing the delivery system, so there were several design changes the acquired -- required adjustment. not knowing how complex this project was going to be, including the added features, it

required a much more people than we had anticipated. supervisor kim: how is it that this was not anticipated? >> this is one of the most complex high-rises in the country. we saw some complexity, but not near to the level it was on the project. supervisor kim: taking on a project as complicated -- it has been an issue on the board previously, one of my colleagues asked a question about our contract and how much we amend them, and the size of our contribution to them. in many cases, amendments are much larger than the initial contract when you add them to get there. how is it that we can do better

in anticipating the original cost of front so that we stick much more closely to the original cost of construction? >> this body has approved implementing a construction manager and general contractors. you bring them on board to design a system. i believe this is probably of public safety building project. as we continue to deliver the project over the next few years, i think we are starting to get a good handle on the type of staff we need to do this kind of project delivery. supervisor avalos: thank you for the presentation. i know i have been talkinr