this year, we really had discussions about trying to only focus on changes that were significant. those are what we have been discussing on the capital planning committee. that is what i will review with you today. in the capital planning committee, let me see here. i won't focus on that, but i wanted to remind people of some of the accomplishments we have had over the past 10 years and especially over the past year. it is definitely two or three years' worth of work that we have been able to maintain and improve our condition to move toward a more permanent funding source in the future. if we started work on the

veterans building, one of the more vulnerable buildings that houses critical programs and various gangs. that work is underway, it is -- we have a constructedfour bran -- constructed four branch libraries over the last year. we also did quite a bit of work in the past year where we've had about $45 million -- excuse me, $53 million worth of work. five of the six projects have been completed on time, on budget, without business destruction. this is really quite an accomplishment that we are really proud of. dpw owes a lot of credit for that. 14 major part in direct projects

will be completed by the end of the fiscal year. another quick accomplishments to mention, following up on some of the questions from his presentation. we paid the 260 blocks, broken ground on the public safety building in the mission bay area, we adopted a policy for an infrastructure and financing district. we are looking forward for refinancing agreements. we will use that as a way to get additional infrastructure for those neighborhoods. we have 21 fire stations that were part of the earthquake safety bond that right now are under design. some of them started to do repair work. we should mention that we sold a coordinated bonds for -- we

received 2.9% interest on that. it is remarkable. i think it speaks to the strong financial capacity of the city and the way that we mentioned resources and so forth. we're also making progress on the water supply system, the hospital, the puc headquarters and so forth. we are starting to go into some of these cisterns, draining them, looking at renewal were. -- renewal work. it is about a $25 billion program that includes $5 billion of general funds for general fund apartment investment, enterprise departments of about

$11.4 billion, and a lot of the extra no private led development. some of the hunters point shipyard and some of those things is part of the redevelopment agency are included in that figure along with the school district and a similar other partners that affect us. let's move on. thank you. so the capital plan, here are some of the highlights of what we have for the general fund program. this is slightly new. i should say that the shelling of percentages is slightly new. we are funding about $5 billion if you remember from the previous slide and it shows how has broken out. we are deferring about $1 billion, so that is one of our primary concerns at the capital planning committee.

enhancement, it is primarily for earthquake safety. you can see the percentage, this is the new part. this is what is being covered by the cash program and other types of debt. there are federal and state dollars there as well for some of those projects . so the major capital projects that we wanted to remind folks when budgets, around shortly -- budgets come around shortly, it was part of the earthquakes if the bond and is contemplated for the next earthquake safety bond. drives the size of the

building. that is where a lot of the discussions have been. what we have done so far is verified the in house work versus doing it outside or outsourcing is roughly equivalent. we do have other options we can go to that will not break the bank, so to say. estimated construction start as spring 2015, depending on passage of the earthquake safety response bond coming a year from this november. one year from 2013 november. these are the jails at the top of the hall of justice, 900 or so beds are located there. this is one of our more vulnerable buildings. we have done two two population studies -- two population studies. these have been helpful.

pellett -- part of what we're struggling against is the realignment of the state. more prisoners are being pushed down to the local level. we are doing more studies in the future. we do not think we can wait on this so we're looking at a phased approach. looking on strategies to purchase the block next to the hall of justice and see if we can face the development of the new jail. we may build the capacity for 400 beds in phase one. a similar or maybe smaller capacity on phase 2 depending on what the projections look like. >>supervisor chu: this is jail funded? >> that is right.

the next slide, we talk about another part of the hall of justice. that is the medical examiner. this last year we added some funds to the budget to pay for one new hall. that is the photo in the bottom left of the session. we have purchased at. they have done some studies on it. it will meet the level of service we expect. what we're doing is looking for that earthquake safety bonn to pay for the majority of the capital improvements there which will be around $50 million. we should mention that the expansion is something that was in the capital plan last year and is moving forward. we have done quite a bit of work on a conceptual design and the cost-benefit analysis. you can see some of the green representing some of the areas that we would be expanding, contiguous space underground.

there are opportunities to develop some other spaces as well. that is a project that will require more planning. we were hoping by next year we should have some good options as to what it will cost. supervisor chu: we have heard a lot from folks in our tourism and convention business is that this is very important extension to make sure our space is desirable and is competitive with other locations. right now in terms of the capital plan, it does not come -- contemplate issuing geo bonds or back bonds. we would have to get to a different place or of different funding source? >> that is right. it is not contemplated in either of those sources. we're looking at ways that -- this is a big partnership with

the hotel. the hotel industry has stepped up and increase taxes on themselves. it helped pay for renewal project and we're working with them on how they would contribute and we would see this as a public-private partnership with them and looking at how we leverages our dollars and work with them to develop a program that can be funded. the next slide shows because we know a lot of people have questions about our geobonds. this is an update of the geobond rate. the red line at the top is the 2006 rate. we have not increased property tax rates while we have issued $1.50 billion worth of bonds. the white on the bottom shows the bonds that have been issued.

the colored bars above show the ones that are to be issued. some of those are contemplated in to the future. we have had lots of discussion and we always do at the capital planning committee about this graph and how we can continue to manage all those on that needs -- unmet needs in a way that is responsible and not overly burdensome on property owners. one of the drivers of this graph and people have asked can we increase the spawn or about one, one of the drivers is the assessed value of property across the city. that read bar moves up or down based on the excess of value. early in our days we were looking at a 4.5% growth in value every year. the past two years we have seen

that taper off dramatically because of the recession. and now the estimates forc fiscl year 13 -- a goes to 3% for two years and back up to 4.5% after fiscal year 16 to the end of the plan. supervisor chu: in terms of the commitment, we have gone out to say we are issuing a certain deal bonds -- geobonds. it does not represent rates that we pay back in the day. we're holding this line to make sure people feel comfortable with the tax obligation we're faced with. we talked about the assessed value of the property. the market the u.n. has changed. similar to that, we have seen very good market sales at rates

that have been historically lower than the historical lows and that has been good but it might be a momentary blip. how does the capital plan accommodate for this? do we assume an average, assuming potentially a onetime thing? >> do you want to answer that? go ahead. >> good afternoon, supervisors. i am from public finance. you're right. the assumption we have been using was conservative at the time but now it is pretty aggressive. what has happened is the fact we're able to access market -- short interest rates and take advantage of the low interest- rate. we have been able to maintain this line. the office will continue to actively manage this portfolio to make sure we take all that into consideration. supervisor chu: the low interest rates are offsetting the interest value.

>> exactly. supervisor chu: and -- in terms of the long term funding, we do not say we have rates at two. whenever, we should assume that we take an average overtime, is that right? >> what we do is we project the interest rate of 6%. the actual sales is adjusted to reflect actual interest and the projection is conservative. supervisor chu: thank you. >> the next slide we also want to mention what is going on with the enterprise department because they make up the majority of our 10-year capital plan. they have their own commissions and so forth looking at it. it is important to keep that in mind. the airport has been doing extremely well. most of you are aware of that. that has been reflected in their

capital plan so we're happy to see that they are reinvesting in the infrastructure there to make sure it stays first-rate. they have seen an increase of 50% of their increase from last year's 10-year capital plan to the next 10 years. primarily, this is due to the inclusion of a terminal one preconstruction. this is similar to the work they did at terminal 2. this is an $840 million project. it was an emerging need. now they identified this, it will move to a funded project. other major projects over there, you can see the photograph at the bottom left of the new air- traffic control tower. there's a lot of run like safety improvements that are going on. the picture is not an actual test crash, it was testing the new runway material that we are putting in place so of plane -- of a plan has to land and it

does not have the wheels down, this would allow the plane to stop without causing a major crash or loss of life. next, we stepped over to the mta. they will present after me. they are showing -- of their funds here are an unconstrained amount of $10 billion. that if you -- that is if you took their needs, their plan is funding, that is $2.70 billion over the first five years and roughly the same amount over the next five years. some of the big drivers of those numbers are the central subway is being included in their capital plan, over $1 billion. we have some other big projects like fleet replacement, a lot of their fleet is reaching the age of its useful life. in the first five years, that is

contemplated at half a billion dollars. there are other projects, other- aid projects that people -- high need projects that other people want. next we have the port. we have been here a number of times as of late. part of that is figuring out where things are with the america's cup. their increase was slightly over the 10 years but they are increasing 2%. they have done a lot of seismic made estimates and so forth. the major projects are the crew ship terminal and you have a lot of the america's cup improvements and so forth. you can see the new terminal. on the right is pure 80. -- pier 80.

the next area is the -- the user capital. the next 10 years we're looking at a $7 billion investment. that is 12% over last year's 10- year estimate. they're becoming more aggressive. the commission asked if it wanted to start doing pipes and sewer line replacements. they've raised the amount will be doing per year to keep up with those requests and that is driving the need for greater investment. again you can see the digest is there. this is large infrastructure that is very expensive to maintain. the sewer system improvement program in our plan is a $5.9 billion effort that you'll be hearing a lot more in the years to come next year.

getting back to -- in the capital fund, you will see when the departments get up to you. the red line of what is talk -- come across is the capital plan. we did have some years where we had some surpluses. what the challenges have been our that we are not able to fund some of our renewal programs which is where we would want to drive the money to. you can see the renewal program there which is that great. it is hard to tell on the screen. the first bar up from the black bar, >> those pay for things

like maintenance, buildings or facilities, not street resurfacing but fixes to roadways and curbs, when we have things that pullout, sort of ongoing maintenance type activity. when they pay for street resurfacing, it is happening in the chamber. it is a number of different projects involved. that we're addressing the major liability is something that gets

funded this way. we are looking at critical planning efforts. this needs to be put up front so we can go to voters and tell them what it will be costing and where will be located. those are what the program will be about. >> a big shift here from 2011 to the current year is a significant drop in the streets and right-of-way, pay-as-you-go program. we will it -- is that way we will pay for it with the streets bond? >> that is right. i will show you quickly if you go to slide 14, you can see the map of what is going on with a straight bond and it will give you more of a finite picture of how that is being funded. like i said, we are excited

we're moving toward a pci of 70, all our streets being in good condition. if you notice the greenbrier on the far right, those are the ones we need some type of new source of revenue for. that is a big part of our effort is to work on what types of revenue could potentially pay for that. we really want to make sure that we take better care of our streets and we do know that if the streets are in good condition, it costs the same or less to maintain them if there were in bad condition. this is an opportunity to get to that state of repair. >> osupervisor chu: we have see- that was the result of the reauthorization of prop k, that has changed or we said we would spend the funding so that is a significant change. in terms of funding, the jiabao

and covers ester 2014. beyond that unless there's a different source, we will seek a big problem or a big gap. >> that is correct. that is right. going back to -- the other thing if you look at -- go back again, i am sorry. again, we were talking about renewals and what is happening with the renewal. these are the core things that i mentioned, neb., that things if we do not fix it now, they tend to get worse and more costly. that gives you a more finite picture. this is what we need to invest to keep our buildings in the current state of repair. that is more than we can afford it in our budget. it translates into about 1% of our current replacement value for buildings. the industry standard is for a building you have, you want to reinvest 1.5 or 2% back into the

structure every year. that is ideal to make sure that it continues to run well and it is doing your annual checkups or maintenance for your car and so forth. what we're doing is the capital plan is recommending the red line below an estimate of 6% of the current replacement value. i am sorry, 0.6%. that is lower, then we should be doing. that is -- we're trying to grow that by 10%. that is the most appropriate approach. -- prudent approach. we are funding the annuals less than that, at 0.02% of the current replacement value. this is where we see this upcoming big problem is where we will get emergency repairs, we are starting to see it. we're getting ahead of the curve

for start doing these things before they blow up into bigger problems. the last slide here, i live to briefly go over here is the budget preview and what is going on. right now we're working with the mayor's budget office with members of various departments and so forth on the request. we received for 2013, $126 million in requests. we have less than that for 2014. we have $403 million in non- general fund requests, so mark the bonds that are going to be sold. 379 constitutes the money that had been committed. we will come back to sell more bonds for the san francisco general hospital and that will be a big chunk of this dollars.

you can see what is recommended in the capital plan. the program for this recommend $64 million. last year refunded if you remember at 43 or $44 million. those are the various things we will be grappling with as we winnow down and prioritize the of requests we receive. supervisor chu: what is the enhancements, $51 million? what would fall under that category? >> are paid to go program we tend to focus -- our pay to go programs, we focus on things that are -- a handful of improvements that will make improvements to things. things in that area would be funds for various new streetscape improvements, such as jefferson street. i -- there are various other

projects. departments of -- department of public health, there interested in moving people out of leased space into owned space. we would have to -- love to have our funds starkly pay to go. there are already of enhancements that are critical. sometimes it could be historical preservation of various sites. >> -- mission street. supervisor chu: this is not a reflection of what was funded or what we plan to fund. >> that is correct. a lot of the enhancements we end up finding is that project development phase. projects that we think we know we need to have but we need to do some planning to figure what they are going to cost, so.

supervisor chu: ok. does that conclude the presentation? >> that concludes the presentation. there is one more slide. are there any questions? >supervisor chu: i wonder if you ever funded granite treatment. i'm just joking. >> i defer that to dpw. supervisor chu: we were so -- we removed granite from sidewalks were from curbs in the past. we used to have those. ok. why don't we open this up for public comment? are there members of the public who wish to speak on this item? >> ♪ with a little luck with

your 10-year plan, i know you can make it all work out ♪ ♪ you can lay the plants down, there can be no misunderstanding ♪ ♪ with all little luck, you can make it work out, you can bring your plane in for landing ♪ ♪ with a little luck, you can make it dandy, make it like candy, you can make it work out ♪ supervisor chu: thank you. are there other speakers on this item? seeing none, public comment is closed. thank you for working on this capital plan update and we look forward to hearing more about it in the budget. we il