taking it upon themselves in their companies to be socially responsible, and it is harder than it looks, and it should be more than a branding campaign. you know, i absolutely agree with that, so i would propose at a minimum, we were all the non local back to 5% in that we increase the local, and the local would be on top of, i guess 10% if you are local. right now, they are proposing 2%. perhaps that can be increased. i do not know. >> commissioner dooley? commissioner cooley: -- dooley: i am agreement commissioner declined. i think we need to raise this -- in agreement with commissioner

acly -- clyde. we should raise the local to 13%. there has to be a balance, because we are already at a disadvantage, and i do not want to say. commissioner clyde: going back to the president o'brien's comment, i would go to 13% or so. it needs to be done. again, san francisco has a unique, and expensive, mandated employment and work environments. >> commissioner riley? commissioner riley: maybe we

should ask them to take the health care and the issues, that they have to pay, to take that into consideration and come up with a recommendation of how much percentage. >> director? director: moving forward, in order to provide supervisor chiu in order to move forward, we may have to weigh in before the final vote on a piece of legislation. i just want to make sure that you are also taking into consideration that there could be a contract where there is an lbe that is not a benefit corporation bidding on an item,

and right now, they could both be lbe's, or the benefit corporation could not being an lbe. to make sure that our preference is that the lbe gets that, keeping in mind why we have that preference for them. i just wanted to throw that in in terms that it will not always be benefit corporations versus non benefit corporations potentially bidding on a contract. commissioner: so it would benefit -- is that right? director: in your discussions if

you will be talking about percentages, there might be a time when there is a non l;be -- lbe bidding and one bidding. >> commissioner dwight? commissioner dwight: i am struggling that there would be a benefit preference to one or the other. we made a determination that we're going to give a preference for local versus non local. i think if we were going to make a determination that we would also give a preference, let's call in a preference for benefit versus non benefit, that should be a benefit. 2%, 3%, whatever it is. if you do not need to the local, you do not get that. if you do not meet the benefit,

you do not get that, so as you come into this, you say i'm going to come in on this as a b corps, and i am going to compete against local companies that are going to get their presidential -- preferential treatment for being local, so i do not think we should boost the weight for a company that is not local. you get that for being local or non local, and kind of lulling the plainfield, because if not, we will of a big discussion on whether it would have more b- ness, which is what we have said. we have gotten into a situation where we are not evaluating apples and apples here. so i think there should be a number for being local and a

number for being a benefit, and that should apply equally, and we should consider that as a possibility as a theoretical underpinning for this, because salma -- somehow, it has been that the jon weight should be different. to me. commissioner: i think some of what we are talking about, even with the 8% for the advantage, the out-of-town companies still have a major advantage financially in general, because when they are operating outside of the city, they can put a much lower bid in than the people in the city, so i am kind of hesitant. frankly, i am kind of hesitant

to give the out of town any benefit. commissioner dwight: i think suggesting that it would have a higher percentage for its status versus a local company getting a smaller boost for the status, if we just eliminated that and send your status is worth this many points, and your local status is where this many points, and you can imagine a whole collection of preferences that we would tally up, and they would not be weighted. they would be absolute. somehow, there is a theory of waiting them -- weighting them. this could go a great deal towards lowering the benefit of the local, that 10% or 8%, so anyway, i think there is a

possibility to simplify this by saying this is what you get for being a b corp., and this is what you get for being back, and it is that simple. president o'brien: i like that. i am all for simplicity, especially when doing business in san francisco. i want to get back to the director. with us coming up with percentages right now that might not be fully informed, what that really means, and that we could be given a figure that really understanding the impact of it. do you think we should wait until we hear more about work in 1% or 2%, how that plays out? >> -- director: no, that is not what i wanted you to think

about. if you wanted to make a recommendation on the different percentages, i just wanted to make sure we had that discussion, and a motion is made if you want to go in that direction. i think, you know, and perhaps commissioner dwight could clarify -- right now, we have for our lbe and our sba lbe's, which are slightly larger small businesses, we have a discount for them. president o'brien: for being local. director: and we say local because one of the state propositions, we cannot classify our businesses as a woman, minority, or small business, so whenever a local, an lbe designation, which is intended

to encompass all of those, so the question comes up, and you can go the route to the commissioner dwight s. saying, if you are an lbe, you get this. you also get to add the benefit corporation percentage on top of that, but what i wanted to make sure that we're keeping in mind, because the discussion just seemed it was benefit corporation versus the benefit corporation in terms of potential bidding on a contract, where you might have a benefit corp. and an lbe, which is not a benefit corp., said that was just -- president o'brien: ok. director: update, or you could

go with commissioner riley's comment, which there was a big discount, which i think is what supervisor chiu was working off of as sort of a standard. commissioner: with the supervisor be responsive to something as proposed by commissioner yee riley? >> i think we want to move this as fast as possible. commissioner yee riley: it is hard for us commissioner: i do t commissioner dwight's point of view, which, exactly.

this is what the percentage is for this corporation, and if we have lbe's competing for contracts, that is part of the contract in process. commissioner yee ruil -- riley: have we done some study and came up with that? commissioner: how long will it be before that report is ready? >> it is normally ready before the finance committee for the board of supervisors. you can ask for it to be earlier. director: if you want to have

that, you may want to give a recommendation of no more a man or no less than a, sort of a range, but, yes. i mean, that is another way to think about it, providing the supervisors some direction and began thinking about the impact to our local small businesses. commissioner dwight: i think if we would say an outsider would get 4%, and an insider will get to%, i think what i recognize is the goodness of this be corp. movement. it is good, and i think san francisco would be the right place to taking a leadership position, at least on the west coast, and i think we have to be careful that we could undermine our previous legislation around local businesses by having this

differential, because it would then allow -- it would sort of create perverse outcome of all of a sudden be corporations from the outside had an advantage over local. we have a very direct effort to carve out a bid preference for local businesses, so let's not up and that it inadvertently, -- let us not upend that. we want to knowledge that this is a good trend, a trend that is likely to continue, and one we would like to take a leadership role on. i think we can do it in a very simple way by knowledge in a percentage for those to meet beebe corporation definition and separate it from the local. treat them both on their own merits. president o'brien: janet?

clerk: can you put that into a word as a motion? commissioner dwight: a preference if they are be corporations, and excuse me if i am not using the right terminology, and it be the same if they are local or not local. i move that whatever percentage, that we agree to give for being a b organization, that'd be the same for a local company as it is for a non local company. commissioner yee riley: i think that is the way it is written right now. it is just about the age%? director: it is not written that

way. commissioner dwight: maybe i misread it. director: a benefit corporation regardless if you are in town or out of town, whether you are in san francisco-based company or not in san francisco-based company. if you are a certified lbe, and you are also a benefit corporation, then you get an additional 2% added to your bid discount. commissioner dwight: so it would be 10% plus 2%, and you would be competing -- but that is just in the same way, it has -- i do not know the right term for it, but it has the same effect that we

just talked about. you can only get two extra points for being and local, and you can get eight extra points and narrow the gap for what would be two if you're an outsider, versus 12, to making it 8% versus 12, so that is a huge difference. just the way it is written. commissioner yee riley: if i qualify for both, i should get 18%. commissioner dwight: no, no, because i am not going to recommend 8%. i am going to recommend that what is given, that that same it 2% be given, whether it is 2%,

4%, i think we want to maintain the differential. this is competing against a non local, non-b corporation. >> we came up with 8%, just looking at the existing percentage for local businesses, but we really did not have a strong reason to start with 8%, and we are definitely open to adjusting that in the downward direction, but we did not want it to act to get a team, because at that point, you might start distorting the bidding process, when you get someone who is less

qualified to do the job, so that is why we did not do additives for that part. yes. i think we are open to 6, 5. maybe the recommendation could be less than six or seven, in consultation with the controller, whatever. commissioner dwight: i would just like to see it not be different. those two are added. you get x plus y. if you are local and not b, you get x, and the criteria is only if you are local or not local or if you are b or non-b. that is my suggestion.

director: if i understand, commissioner dwight, we have those inside san francisco, outside san francisco -- commissioner yee riley: so are we did with the 8%? director: know, something that it would aid like or less than six. director -- commissioner dwight: you get the other preference or being local or not local, and that the two are added, so whenever that percentage, not to exceed whatever percentage we decide it should be. that is sort of directing supervisor chiu that we believe there should be some sort of

threshold but does not distort and where a local guy is getting 10 plus, and then we are starting to mess around with the local. commissioner: i this want to make sure that we are talking about this being based on the dollar threshold. where your business has to be registered here, but you could be in the oil business that is a non lbe which is a larger business. with the discussions that have been had about the higher cost of having your business inside san francisco, even for larger businesses, it is still a higher cost, so i just want to make sure that everything is thought about in terms of a recommendation in terms of not trying to give direction, but making sure the consideration for the non lbe san francisco-

based businesses, then that is thought of. commissioner dwight: you can be local and the an lbe without being incorporated. you cannot meet the definition of b without being unincorporated. we actually do not have a situation where you can be, let's say, if you are going to be local and b, you must change your corporate status, if you are not already a california corporation. as currently defined lbe to go and get blessed as meeting the b standards. they literally have to become a california benefit corp., which means they have to change their status if they are not

incorporated, that is an important distinction. commissioner: for me, that is like a lower amount. president of brian: can we put it like this, that the minimum benefit should be 2%, and the maximum benefit should be no more than 6%, because that takes into account the distortion concern, and i would ask, and also to -- what is the word i'm looking for, the comptroller's office, to try to discount the extra fees for doing business in san francisco, to the legislation, would that get us through here? director? just to get this over?

director: there is a high-level complication in terms of having the controllers office dealing with setting some calculations, and i think in terms of oca and hrc, we have gone to the straight percentage. now, if the comptroller saba's is to help provide some information to make those determinations, but i would think, and catherine, you can speak to this, but i am hesitant to say that the controller, that would be a whole new piece of legislation that we would have to draft. commissioner dwight: as supervisor chiu has said, if

that has to be a second issue, he is happy to promote that. that was contemplated in the establishment of an apprenticeship get for being an lbe. most rapidly, to get out of the argument about whether it should be different for an inside company versus an outside company, so our recommendation was that it should be no more than 6%, no less than 2%, and that it should be applied equally to a local or a non local company. that would be enough guidance to allow this to proceed. i think for the future, and discussing whether there should be a different lbe situation, i think that would be different. to try to incorporate that and manipulates the b president's --

president -- precend -- preendence. clerk: commissioner? commissioner: to look and see if there needs to be any reassessment. if there are any benefit corporations being afforded contracts, but if there needs to be a distinction between out of san francisco and in san francisco, so allow the time for the legislation to be and city, contracts are awarded and what kind of effect it has come and gone with commissioner dwight, for the non lbe businesses.

commissioner dwight: let me see if i can get through this. i move that we propose a california benefit corporation preference not to exceed 6%, but not to be less than 2%, to be extended to any company meeting the cbc definition period, and that we have a reassessment period of three years, where in three years' time, we will come back and determine whether the preference we have defined for the status is a good one. is where we want it to be a. so what this motion says is we are going to extend a cbc

preference of x%, between 2% and 6%, and that we are not going to make any distinction about whether that company is a local company or not a local company, because that is already dealt with. we have lbe legislation on the books that says if you are, you get a preference, so let's just not go there. let's just say we are adding a cbc preference, which is between 2% and 6%, which will be reviewed in three years. commissioner yee riley: it does not matter if you are local or not. it would apply equally, so if you are a local business, you are entitled to 10%, and if you are local and regional director: can i just make a clarification? we are talking local. lbe could be levi's.

commissioner yee riley: 10%. so what if you are both? commissioner dwight: they are additive. it would be for a meeting the cbc criteria. we are not touching the lbe criteria. commissioner yee riley: so what if you are both? commissioner dwight: it would be in between 2% and 6%. if you are not an lbe, you would get back x% if you need to -- if you meet the criteria. president o'brien: it is already in there. commissioner dwight: