technical assistance to all of the borrowers and applicants before, during, and after the loan is made. this would be for a term of five years and, pretty much in perpetuity of the revolving loan fund, which working solutions was able to provide for this amount of capital. the three major needs for recapitalizing or the following -- there is definitely a demand for this capital. working solutions received 25 loan agreements per month, alone. at $25,000 average per month, that would be more than half of the million dollars in financial requests. no. 2, that this part, this recapitalization is a critical component of our nation district -- of our districts strategy.

we definitely need more economic tools to help the small businesses in the economic ever heard, especially underserved neighborhoods. we will be working with district 11 organizations, such as caa and the filipino community center, to see the needs in those areas, targeting financial assistance help. the third is -- they're definitely needs to be a volume of capital to launch this fund again. in 2009, there were 283 inquiries alone right after the launch. that is $7 million in requests just a few days after hearing about the fund. revolving loans today are close to $200,000.

the relaunch would not be able to satisfy the citywide needs. we do have an outreach and marketing plan. we will be getting the word out. our neighborhood partners in economic development organizations, like urban solutions and the renaissance center, we will also be working with the new jobs plug. this is the initiative to be an extension of the small-business center to reach out to neighborhood and commercial businesses. part of the wells fargo plan would be for our managers, part of the office of economic work force development programs. the one to one or door-to-door campaign, there would be a media

outreach at the small business center job squad, but also door- to-door with managers and staff for multi-lingual, spanish, and chinese. >> -- supervisor kim: is there already a corridor meter? >> we have 11 in the neighborhood market initiative. this would be in the valley. supervisor kim: i am sorry, which one? >> of leland avenue. -- on leland avenue, lower pok lk street, third street in bay view, mission excelsior -- supervisor kim: mission street and excelsior? >> yes. lower 24th, fillmore, and terra

belle. supervisor avalos: follow-up questions as well. on those corridors, or those cities that? or are they contract out? >> it is a combination. they provide oversight in those corridors. we also check out to neighborhood organizations that have the capacity to do major our reach. >> >> for the excelsior, that would be the excelsior action group.

at ocean avenue, that would be the ocean avenue action association. supervisor chu: it had formerly been funded by the city in the past. >> yes. supervisor avalos: has there been any real assessment of what the success is? what do you see standing out as what really made this program worth funding again? >> after my half of the presentation, we will be talking about the current loan portfolios and success stories with that, so that we can answer the questions in the later half of the presentation. supervisor avalos: great, i will hold on to those. >> thank you. about the revolving of loan fund in requirements in terms, businesses need to have no access to bank loans and be able

to create and return one full- time job. in terms of the revolving loan funds, it is very favorable. up to 50,000 for existing businesses. the term of the loan is a fully advertised term. business rates are below the banks and other contacted -- contacted? organizations. just to give the income terms 44%, that equates to $460 per month. the loan uses as well are very flexible. we have working capital, inventory purchases, equipment, machinery, startup costs. just in the bit about the revolving loan funds in working solutions, they managed the

entirety of the lending process from deals, underwriting, and bone servicing. they have financial specialists were fluent in spanish and chinese. the added benefit of having the profit administrator in the loan fund is that with the fund beyond the balance sheet of a nonprofit, they were able to access guarantee and loan-loss reserve programs, such as california capital access programs. working solutions are able to mitigate the loss with their strong underwriting process and technical assistance. loans to date have developed no charges. the bay area loans have gone to $2.2 million. compare that to the standard 4%

to 5% from other providers. before i introduce the latter half of the presentation, i want to read into the record testimonials from our loan providers. i sent them out to be included into the file. this one is from brian. he writes -- i am writing to express my support for working solutions in its programs, which have benefited so many local businesses, like ours. we are developing new educational toys. the cost of developing new products have been prohibitive for small businesses without investment funds. in this economic climate, it is next to impossible for a company like ours to maintain debt financing. without loans from working

solutions, we have been -- we would have been unable to build two of our products. the designers and engineers that participated, our catalog would be smaller, leaving salespeople but much less to sell. again today, small businesses need programs like those, from working solutions, to grow. i hope that they continue to support their efforts. sincerely, president of twister toys." the second testimonial is from core reynolds. his business is called core foods. "by business would not exist without the revolving loan. with this loan i was able to grow my hobby into an operational business, employing two full time in several part- time employees.

the working solutions provided nonstop, critical business counseling and advising a rock -- along the way. without this clear direction, i certainly would have made potentially catastrophic mistakes. i believe that these are some of the best investments that the city can make. we are used to efficiently using the resources we're giving -- given. the kindness that has been shown has inspired me to give my prospects -- profits back to the community. we pay health insurance, pay living wages, supporting farmers across california." the third testimonial is from urban bizarre -- supervisor chu: with regards to the testimonials, perhaps you can share a copy of them with us in the testimony -- in the record, perhaps we can receive them that way rather than beating them out loud.

>> ok. supervisor chu: are their closing comments on your presentation before we go to the next? >> that afternoon, my name is emily and i am the executive director of working solutions. it is a community development financial institution. a designation that the treasury department for organizations that provide micro loans like ours. our entire role is to help small businesses to thrive and create jobs and viable opportunities in the city of san francisco. our unique model is part of the success of the repayment of the loan fund. we wanted to talk about technical assistance and what that means. coaching, advising, and mentoring. coupled with the actual access to capital peace, including

educational and technical assistance, helping the business is not only with the dollars, but expanding the businesses to grow and be more savvy entrepreneurs. during the pre-loan phase, we provide about 20 hours of business coaching per business. during this time we help them to understand their personal finances, business finances, and personal credit, as well as a need for a loan and whether or not is the right time for than -- whether or not for them it is the right time. it is so crucial to the success of the business, thinking after the loan -- but will i do with the money? once we provide those 20 hours of assistance, we have a community group that reviews each application. once it is approved, we provide

five years of free advising or technical assistance. this is true of all of the businesses, as well as the loan fund. but this post-loan coaching involves is a staff member every three months, going over their finances with them. their marketing plan, their business strategies, talking to them about the challenges that they are experiencing, connecting them to the proper resources. in addition, we connected a business to specific projects, perhaps creating a sales plan or marketing plan. we bring in skilled advisers to work with each business. we provide extensive legal services to the business, as the legal help that they will

receive is also important to that business. r.m.b. year free legal services to help them understand their contracts and legal structure that is best. we also have educational workshops that we have both participated in. there are eight of them per year. marketing, social media, a human-resources, and all of these things that businesses tell us are the most important things that they want to learn about to have a successful business. over 85% of our businesses are still in business after five years, compared to the standard 50% failure rate reported by the fda, that is a huge success. an example of a business to receive technical assistance support from us was the outlands cafe, which was able to create 14 new jobs.

they are expanding rapidly. in terms of the san francisco revolving loan fund that we have administered, we have made loans to 28 businesses. we cannot stress how crucial this financial support is for the businesses. as you have heard from testimonials, these are businesses that cannot get a bank loan. there is close to no option for them, especially start up businesses that banks will not lend to, where they believe the funds to get started but there is no other option for them. the 28 businesses run it -- receive loans between $25,000.50000 dollars, and they have created in retained 74 jobs. the funding has helped 17 new businesses get started and 11 businesses to expand their operation. one of the goals is for them to get their funding from us, from

the city, and be able to graduate and leverage those funds to get a larger bank loan. our lowest recipient, after having received loans and becoming more successful, stabilizing, have access to an additional $500,000 in loans. in terms of the demographic of businesses that we have worked with, 57% of women owned businesses, 68% are low-income entrepreneurs, 57% are minority- owned, in a slight difference from the power point, 60% or startups, 40% our existing businesses. -- 60% of them are startups, 40% of them are existing businesses. here, this is this has created eight new jobs and is supporting

a number of low-income immigrant employees. on the next slide, we just wanted to highlight that this is a citywide program and the location where the businesses are located, and the owners, are revised. you can see the breakdown throughout the city. and finally, the final slide talks about -- supervisor chu: the supervisor has a question? supervisor kim: ok. i am sorry. supervisor chu: we just wanted to see the distribution of loans. the slides were movie -- moving too quickly. supervisor kim: you can keep going. >> a number of these businesses are creating their products in

san francisco. generating additional opportunities, for example, these handmade bags are created here. heliotriope make handmade lotions and bath products. this company makes children's decorations. these businesses are very much san francisco focused and giving back to the community, providing a lot of opportunity for not only their own employees, but for others in the community. supervisor chu: is that it for your presentation? >> it is. supervisor chu: let's go to the budget analysts report. >> madam chair, members of the committee, on page 4 of our report, we point out as shown in

table no. 2 that the proposed $1 million supplemental ordinance, coupled with the additional loan funds from previous small- business loan repayments, the funds for the small-business loan fund would have a total available balance of more than $500,500, including $226,000 for working solutions and administrative work, $1 million for loan capital. currently, the average small business loan is $25,000, as reported, such that the additional loan capital of $1,283,000 would fund about 55 loans, each by the requirements of the loan are to generate at least one job for low to

moderate income workers for a total of 51 new jobs in its infant sysco. at the bottom of page 85, we pointed out that as of the riding of the report, there has not been an overall independence valuation of the program. in addition, as of the writing of this report, neither the office of economic workforce development nor the working solutions are below the moderate income jobs that have been created under the program, even though there is a requirement that each loan produces at least one job. so, on page 6 of our report we see that there has not been an independent evaluation of the program. there is currently a total of $768,000 in funds available to continue the small business program. that would be approximately 31

additional loans. we consider the approval of these general fund monies to be a policy decision for the board of supervisors. supervisor chu: thank you. supervisor avalos: just one question. office of economic and workforce development, i feel like the idea of this program, the concept is something that is important in terms of being able to restores our commercial corridors and small businesses in san francisco. i just feel that for bringing $1 million in, 51 jobs, it does not seem like it would be able to create a lot of jobs for $1 million. before we come to that realization, i was releasing not a lot of parts of this loan

coming to districts like district 11, the sun set, even though the average is done. we do not have the model that meets the requirements for the first language that is not english. we do not have the environment that would be welcome to the merchants. the folks on ocean avenue help to build those relationships. in terms of how we can create a revolving loan fund, and how it can serve businesses along a corridor. i have been to ones in other districts and have seen how they

are successful. it seems like a different type of business that can access these loans, to a greater extent. i see some really great businesses that are there. they are more on the peak and. we actually have small manufacturers. i am seeing a difference in the neighborhood about the types of businesses that are there and how they are be able to be served. we have a model that is able to actually work in various districts, but i do not think we have that, though it would be great. i am concerned that we would be moving forward on a program that is not going to lift as many votes as it should lift. i would like to get there.

i think that it is a working idea to start up with. i do not think it be quite got the formula for that. we are not going to have a valuation until a little bit later. we have also had the experience, people working for the office of economic workforce development, there is an experience that we have had. how was that informed by the next round? >> your concern is as similar as ours. the same concern about reaching out to the under-served neighborhoods. we have been working to get the word out and we plan to do so with this new influx of recapitalizing the revolving loan funds. first, we are going to see what businesses we can reach. since they are city-wide, we are very proud of that and are

cognizant of the idea of what you're seeing. these commercial corridors are not getting assistance. we will be working with working solutions in the office to work on the marketing in the outreach program. >> amy cohen here, we have a constellation of programs and services available. there are times when this loan is not the right moment. there are organizations that give people smaller loans and provide different kinds of assistance. i wanted to make two other quick points. they make many more jobs than the required, and i can think of other examples of that. the other point to make is that this money revolves. although it is one job per 25,000 when it goes out, when it comes back in, it is making

those jobs again. whenever it needs replenishing. supervisor avalos: i think that we have -- i have been thinking about a model that might be useful and how we can saturate departments from the commercial corridors. especially in particular areas that are really troubled. i do not want to be specific to district 11, as there are places with difficulties like the difficulties we have. how can we believe focus services around pedestrian safety? along with these revolving loan funds.

we do a combination of loans and grants that will show a physical difference. to me, that would be like a step in another direction. i think that it would actually make people see a difference as well, as to how such programs will be serving as. i am not sure that we have thought about it in terms of those ways, but there are intersections on [unintelligible] and [unintelligible] that could use that type of concentration of services like that. it would be a great component. but the think? -- what do you think? >> absolutely right. it is how the neighborhood market initiative has been modeled. we have not had the resources or

the leadership to do what you say. as the mayor is getting ready to launch in his neighborhood strategy, we have reviewed all of the things that you have said as part of the tools into kit. we think it is important, since it is not the be all and end all by itself. >> thank you, a supervisor -- supervisor chu: thank you, supervisor. i also want to second what was said about the average in the different neighborhoods in the district's where there was much more that needs to be done. there is a comprehensive strategy that needs to be looked at. we have often talked about it. supervisor kim: i am excited that the mayor's office is introducing this. i absolutely believe that the city should be increasing sources for micro loans for

small businesses. it is one of the right ways for us to support small businesses and job creation. i saw that there were a number that have approved loans from district 6. i do have concerns about neighborhood diversity, even though they are not in neighborhoods that i represent. in terms of whether there is a strategy for the giving out of these $1 million in loans, having a strategy in terms of the best bank and how to have the most impact with high vacancy rates, funding two to small businesses in that corridor.