five years ago. it is still that amount. i think that proportion of it -- you could basically say that if the costs numbers are applied, that is the amount we lost each year cumulatively to the ability for our workers to be able to keep pace, because there have been no raises during that time, and that is a similar reality process system. we have not had to cut salaries. we have a union contract, and we have other realities, but some agencies have had to go back to their workers and ask for our reduction to keep above the water, sir asking for keeping pace with the cost of living index is just keeping us even. what is not covered is five years of incremental falling

behind. there should be a request to make up the five years we have lost just to stay home, and we are asking for something more modest. we want to be included with a fare increase in our contracts, and many people may think i am being too conciliatory. it is an incremental problem that magnifies each year the we are not able to pay an increase. my health care has been ardent down to 100,000 more. that is something i cannot pay unless -- if i am to pay their health insurance. >> it is often suggested

nonprofit organizations ought to go to philanthropic organizations and public not -- other public donors to give us a sense of these cuts. can you give us an idea? >> it is something that needs to be put into context. the economic downturn created the real deficit and affected the philanthropic community. at the same time, funding has been produced of the federal, state, and local level. gso has the ability to give more money out of their portfolios a. there has been a reduction, because their portfolios have suffered more than the cities have. the san francisco foundation,

one of the most philanthropic of until the next few years has had a maximum grant of $30,000. maybe you can get a three-year grant, but you have to continue to get that money. it used to be government was the answer. that is not there anymore. no foundation will fund ongoing operational support for a longstanding agency year in and year out. it is one piece of the puzzle, but it is not a solution to funding reductions. it is a fair allocation for the city and county. >> did you have a question? >> that was my last question you covered. next up and we have emma. it looks really good from here.

it looks like the chambers have been occupied. >> fifth chambers have been occupied. did we have overflow rooms full and about 50 people waiting to get inside, and it shows what a need there is for this. i have the opportunity of working for nonprofit workers, and i am going to go over some information about the cost of living in the city right now and with the wages are and the comparison, so as you have heard, there has not been an increase for nonprofits in five years, and in this time, there has been a substantial increase in cost of living. if you look at five years and combine them, it is about 8%. this year it is 3%, and the cost

of living in san francisco is 61% above the national average, which is considerably higher. gooif you look at gasoline, it s increase 14.4%, and the prices at home have increased 4% curator and -- have increased 4%. san francisco is the most expensive rental in the nation. if you look at a 2-bedroom apartment, it costs an average of $2,300, and if you take a calculation of needing to pay one-third of your income on rent, that is $41.31 an hour,

and we all know that our nonprofit workers are way below that your good -- is way below that. the average case makes $7.86 an hour. that is quite a large difference, so from our perspective, there needs to be a lot of catching up to do for people to live in the city, and a lot of nonprofit workers live in the city and contribute to the economy and have children and need to get a cost-of-living increase and cost of three business increase. goo -- cost of doing business increase. there has been an increase in health-care costs among employers. they have had a 71% increase in

health care across. that is completely staggering, and in the time, funding has remained flat, some money that could possibly go to our members' wages go to kaiser and health-care providers but do not need more money. i think the thing we want you to take from this hearing is that you can see the great need of this cost of business increase for nonprofit workers. this is important to us. we have people waiting out in the hallway. goothis is really important to r community.

good >> thank you very much. >> i am a nonprofit proudly represented ivby sciu. i am here to talk about the pressures are faced running an organization with 260 and people. i face the same pressures as any small business here in san francisco, and i am being told but we need to do more with less. for years, for the last five years, our funding has remained flat while our increases for health insurance, workmen's comp, television supplies have skyrocketed. we have had an ability to keep up with infrastructure because our contracts to not carry those

costs, and we are constantly scrambling to make sure we provide a safe level of care to the 1800 formerly homeless tenants. i want to address some of the comments made earlier by the budget office and the comptroller. i ha been working and the non- profit sector my entire professional career. i have answered hundreds of requests for funding applications. good nonprofits never vote in an escalator for any of these costs into the bid, because they know they will be rejected, because the expectation is we could do it with london. i would like to hand out some charts that indicates some of the business pressures and we are facing here it is common knowledge that while each contract is different and each entity is different, i am sure

that construction companies that do work or other entities, but they build an escalator. it is only good business sense. >> different departments have different types of rates, and your chp receives funding from many different departments. what kinds of constraints does it have on your ability to work democrats and we contract region on your ability -- on your ability to work? >> we contact many, and we need to have training the record we need to have folks that can go get more contracts. we need a level of management commot, and our indirect rate it

we charge for overhead. did the federal government looks at the door on it and says if your auditor says your rate this 16.8%, they let you do the full rate. the city ranges from 2.5% to 12 1/45% and is normally capped at 15%, so we are looking to leverage other resources and private dollars to keep a level of administrative efficiency, not to count dealing with all of the costs and laid out in the handouts. >> i missed what you just said, in terms of when which contracts contact them and they get an automatic escalator? >> i cannot tell you a

contractor, but i know somebody who works as a contractor. he had a multi-year contract, and he built in the fact that he wanted to give his workers freezers -- raisers. most people in the business community know that their costs go up and when they place their bids with the city there's an expectation the city will cover it. the non-profit sector knows the exact opposite, and we have always expected to do more with less. we are carrying out charity work on behalf of the city. there is an indication we do not have the same pressures. >> could you walk us through the handouts? >> there are two handouts. this is for our agency. if you look at 2009-10, they went up 14% during your -- 14%.

>> the you want it on the overhead? >> it goes up each year during your and -- each year. we carry our health insurance 100% pure goo. we feel it is important that our employees do not contribute to health care, because many of them were homeless, and we feel it is a benefit they should have, so we of sort these each year region -- we absorb these each year. our next slide is the worker compensation rate set by the state.

these go up every single year. there is no way to regulate. we have an environment that occasionally our workers become injured, and you can see they have gone up exponentially every single year, and we cannot pass those costs to our contract. the only way it can be absorbed through the city would be by laying off staff. there is nothing that accounts for this. the next slide is showing for an agency contract reductions we have received from the city and from other contracts we hold, starting from 2009, and we broke it out for years to show that in 2009 we lost $152,000 in

funding. that was correct those -- direct services. we lost $22,000 in what would have covered overhead expenses, so our funding has remained flat or been cut since 2009, and the way we have accommodated that is we have reduced our work force. we shifted overhead expenses and look for other resources so we can keep it safe. this is showing how our funding is being cut or staying flat while our expenses are going up. gooaxe i think there is a questn triggered >> can you explain to remain -- >> i think there is a question. >> can you explain to me what makes of indirect losses? >> if is for our accounting team to build a city.

it is part of our age are function so we can provide services to our staff. it is so they can have an executive director central offices so they can have a central office, things that are not directly providing services to what we are contracts and former -- contracted for. >> in 2010 there was almost $23,000 reduction in indirect losses. am i reading that correct? >> correct the next slide is showing a fixed central expenses. at&t rates go of. office supplies go are. no water and heating goes up.

gas for our vehicles goes up, and you will see starting in 2009 is going up. you will see a shoe qi for 2013, and that is because we had to move three offices, and while we relocated and were very happy the retail cut a very good deal on that property, because of the rising rate of commercial property in san francisco related to the high-tech boom, we predict are fixed expenses are going to go up close to 50 percent signed next year -- 50% next year. we will not be able to pass many of those expenses on to our contracts unless we reduce personnel.

>> thank you. thank you for sharing. it seems pretty daunting. your organization has been able to weather that. a lot of organizations have, and a lot have not, and i appreciate your sharing that information. i have a few other names. we are going to start several public comment. i am going to call them up. [list of names] please come up. you can come up in that order or any order that has been called a request we are going to start a general public comments with two minutes per person. after those names are done, we are going to call from the others sat. goo-- stack.

>> this is going to be more hard send data region -- more heart than data. for the past few days i spent some time with a good friend of mine, corey busch, and his daughter was among those missing in a tragic note thing accident, so cory has served on the board of directors for almost a decade, for more than a decade. yesterday brought me down to his study for a talk, and i noticed a framed poster with the no. 28 in the middle. there were the signatures of the members of the california legislature. the poster had been a guest on the occasion of his 60th birthday. in 1973 when ronald reagan was the governor of california, he began closing one mental institution after another for

so-called new budgetary issues. the legislature passed a law to require hearings and approval in advance of these closing to reagan reagan vetoed the administration, and the senator led the fight to override the veto. gina said it considered it one of his best moments as a legislator. we call on you to demonstrate the same set of principles and vision that guided the state for so long. our services must be funded. our workers must be paid to the rigors of their salaries must be increased if we are to survive as a community and as a city that holds a vision greater than itself. thank you.

>> next speaker please. thank you, everybody. >> i am president of 1021, on leave from my job. thank you both for sponsoring this important hearing and for giving us this opportunity. they have laid out clearly this discussion. from the union's point of view, let me repeat of focus on getting these workers an increase in wages. the city cannot continue to fund these jobs as if it is charity work. being a nonprofit were, the work

you provide is really a safety net it enriches the city. it protects the city. i can only say we are not going to see city workers hit so they give to nonprofits. we are not going to see nonprofit hit so they can give to city workers. this is one of the wealthiest cities. goothere is a tremendous amountf wealth in san francisco, so the ingredients are here so we can all make a decent wage. >> thank you. >> good afternoon, supervisors. we do housing and shelter and employment, and our biggest

costs are wrenserent but also ae housing we have and food. efood is one of our primary costs. health-care costs have gone up. we have to reduce for it to work, and i want to speak as one of the nonprofits that has a pretty diverse funding base, so we do fund raising. we try to have philanthropic dollars as well as city and state and federal dollars, so this idea that we can continue to raise to fill in gaps is a mesyth. state and federal dollars have a decrease.

foundation dollars have decreased, and contributions have remained decrease from the 2008 levels, so it cannot be expected that we can continue to make up for flood funding that has happened. these are private dollars. and we use it to provide new services that are not eligible for public funding, so i want to be clear that we cannot just raise money to vassal -- backfull to raise money. >> i am a city worker, a san francisco resident, and a union activist, and i am here on my

own time. i am fortunate enough to work for the department of aging and adult services, and i get to work with many of the nonprofits organizations. i actually say to folks but if it were not for the nonprofits providing invaluable, linguistically diverse services, i would not have a job, so my viability depends on a stable private sector, but more important is what the nonprofits to do to raise the quality of life in san francisco. often we hear the flight of the low income senior debt must shoes between food and medicine.

the plight of nonprofits is similar. they often need to choose between paying a decent salary to keep skilled staff or paying rent on time or increase in health-insurance costs. we should be working to keep agencies but serve them healthy and hold. another is the displacement from offices they have rented. now that things are supposedly looking up common and rents are also going up, and nonprofit organizations are at the mercy of greedy landlords. who loses? who wins, and at what cost?

>> i am the executive director of huckleberry use programs and also the co-founder of the san francisco human services program. the fact the nonprofits would house squeeze enormously to make do with increased expenses, but i wanted to actually talk about how one nonprofit has to deal with these kinds of cuts. it would be approximately $45,000 a year over five years. when i look at the data, five years ago we had 65 full-time employees. today we have 55 full-time employees. we run up program. 25% of youth arrested in san

francisco are now brought here instead of juvenile hall. goowe are now talking about havg it for another day, in spite of the fact of the probation department and the police would like to reopen its. huckleberry house is still the only license shelter in san francisco, and we have had to downsize. we had to lay off our assistant manager. we have gone to single coverage overnight. only in emergencies can we afford to train in coverage. for those who need counseling

because their child has threatened suicide at home now have a three-month wait list. i close huckleberry house for the month of august. it is getting tough. >> i am going to call a few names. [calling names] >> i am the executive director. i am here as a member of the budget coalition. our membership is made of of primarily grass-roots small and nonprofits who have been devastated by the increasing costs and their organizations are experiencing. they fulfill critical services