period in october 2010. this was published march 29, 2012. you also have before you a supplemental informational packet for today that contains a sheet that presents minor revisions to the eir related to the clarification of the significant threshold for analyzing interior noise levels for nonresidential uses and correcting the eir text to say that the noise level standards for the residential uses is 45 instead of 45 of another measure. this change does not present any news in the information and does not result in the determination that any news in the impact would occur or that there would be an increase in the severity of previously disclosed in packs. -- impatcs. -- impacts.

yesterday afternoon, we received two letters on response for the documents. the first comment letter, april 25, 2012 letter submitted by engineers raises a number of comments related to potential traffic conflicts on the alley with the development of the cathedral hill campus. these comments are substantially the same as those that are raised during the draft eir, period by the same organization, and these comments have been fully responded to in the document. for example, 43 from the engineers, in the document, which was submitted on september 26, 2010, and the response to that is 22 starting on page 3721 in the document. accordingly, no new information is presented, and no new issues were raised in the april letter

from the engineers that change the conclusions of the eir. the second, the letter we received was the april letter submitted by the california nurses association which raises a number of comments related to population, housing, and employment, air quality, greenhouse gas emissions, and hazardous materials. these are substantially the same during the draft eir by the same organization. these comments have been fully responded to in the document. please see the comment letters and the document, which are submitted by the california nurses association on october 19 and 20, 2010, respectively, and the comments contained in these letters can be found throughout the documents. no substantive new information

is presented, and no substantive new issues have been raised in the california nurses association, a letter that would change the analysis or conclusions. during the draft eir hearing, commission members and members of the public raised questions and comments which we have tried to fully address in the document. i want to take a few minutes to highlight our responses to the issue, based on the letters received and the testimony heard which appeared to be of particular concern to the commission and members of the public. some commissioners have questions about the project impact on housing. especially of affordable housing, and with the van ness special use district 3 to 1 housing requirement. as discussed in the land use and planning and population and employment subsections and the response document, starting with pages the environmental analysis

did not find any significant impact related to housing, and there is no change to the finding in the document. i do know that through the development agreement, they have agreed to make a contribution towards housing. we also have from the mayor's office of economic development and the mayor's office on housing which can speak more about the housing proposals in the development agreement. we also received a number of questions and comments about the need to discover additional alternatives other than the ones analyzed in the draft eir or what was contained in the er, such as alternatives. the document addressed his comments in detail in the alternative subsections. as explained here, the study revealed alternatives that would

affect the significant or no impact on meeting some of the project sponsor all objectives. document -- the cnr document determine this would not differ in scope in connection with the alternative, and therefore, the alternative would not further reduce or have additional significant impact compared to the eir analyzed. some commissioners and the members of the public raised concerns regarding the project routing, distribution and traffic analysis in the draft eir. in particular come in relation to the implementation for the campus. just to clarify, the project tripped distribution was based on a variety to and from the development site, consistent with the guidelines and travel

conducted. this included more streets, including streets to the east of the tenderloin area. additionally, based on comments received from commissioners and members of the public, supplemental analysis was done regarding the impact on the tenderloin little saigon area. this analysis, which is included in the document, looked at an additional intersection in and around the tenor line, and a summary of this analysis is presented in the document, 124, and as discussed, it was found it would not have substantial traffic, pedestrian, or bicycle impact in the tenderloin area. nor does it affect the significant environmental impacts or affect the draft eir findings. in addition to the traffic analysis, we also conducted a

trip distribution sensitivity analysis. as described in the document, on certain pages, which increased by 64% the proportion of overall project trips going through the south of market and tenderloin areas. even with the distribution, the majority of the projects were assigned to south of market and the tenderloin area, and most of these intersections continue to operate at the same levels of service with impact similar to those discussed in the draft eir. the sensitivity analysis therefore did not affect about tuition of the significant environmental impact of the project or change the findings of the draft eir. i have with me susan and greg

from the planning department it commissioners have specific transportation-related questions. i also want to point out that based upon the review of the environmental review guidance from the bay area quality management district, the supplemental air quality analysis was conducted. this analysis was presented in the document in the air quality subsection responses, starting at a certain page, and this analysis does not affect our about the mission of the significant to environmental impacts of the project or result in any new or more severe impact than those identified in the draft eir. the commission and the members of the public in the emergency services provided. we address these comments in the document, and the other issue, the health care subsection,

starting at page 323-1. we also have something from the department of public health if commissioners have a specific child care and health-care related questions. finally, i want to note that the staff has reviewed what was published in march 2012 and found that the provisions in the agreement, to the extent that they include physical changes to the environment are adequately covered in the eir or other review documents. questions were also raised regarding potential -- draft eir. as discussed in the document on pages -- we circulation is only required when new information is significant. the draft eir is fundamentally adequate and conclusory. the ceqa guidelines document

what is a new substantial impact, including the increase in impacts that cannot be mitigated, declining to adopt feasible mitigation measures, differing from one previously analyzed, new information included in the document does not meet the definition of significant new information. the ceqa guidelines state that we circulation is not warranted when new information merely clarifies, amplifies, or makes any significant modifications to the eir. as detailed in the findings before you, evaluation issues contained in the eir found that implementation of the project would result in significant unavoidable in a carnival impacts that could not be mitigated to below significant levels. in a certain number of years. air quality and greenhouse gas emissions and another.

the eir is an informational document come and it is supposed to inform you and the public about the potential impact that could result if the project were implemented and ways to reduce or avoid these impacts. certification of the eir is not an action to approve or disapprove the project. the move to certify the eir basically means you believe the eir has provided you with sufficient information about and our model impact and potential mitigation measures. the information presented in the eir is accurate, and eir has come to a proper conclusion supported by appropriate evidence. we therefore recommend that you adopt this before you, certifying that the eir is accurate and adequate, and that it complies with ceqa, the ceqa guidelines, and chapter 31 of the administrative code. this concludes my presentation on this matter, and if any commissioners have any questions, i will turn the stage

over to the next item. thank you. commissioner: thank you. >> thank you, good morning, president fong, members of the commission. items 2a through 2n gather constitute the required approvals for the long-range develop a plan projects. they will provide updates on the

development agreement, this is an overview of the actions being requested it. for the contiguous public spaces. and most of these items are technical cleanup type of corrections, and staff is proposing one revision to the conditions of approval in response to commissioner borden's comments about creating advisory groups for the near term projects. these were previously proposed at campuses with a long-range project. there are several extra hard copies available for the public,

and we will turn this over. >> good morning, commissioners. i am ken, oewe. what we plan to do is amplify on the topics. the hearing elicited the most questions and comments from you. you will see the topics we propose -- sorry, on that slide. usd the topics proposed on the screen. in a few cases, we are proposing some changes to the development agreement. these are fairly minor in scope, and we will go over them when we get to them. before we go forward, i wanted knowledge two documents that we sent to you in the past few days. the first is a comprehensive memo that was sent out last week. the presentation today is basically a subset of that memo, and we are, of course, happy and willing to address other issues

that may be of interest to you during the question period. the other documents sent out was a sheet, one of a couple that you got. this document contains the rundown of all the suggested changes to the agreement since the version you saw at the last hearing. the majority of these are clean up in nature and other clarifications. they are not substantive. a few are more substantive, and we will be going over those. we will be asking you if you adopt them as part of the motion later on, and they will become part of the above agreement that goes to the board. at this point now, i want to ask the deputy director to come up and began going through some of the health-related provisions. >> good morning, commissioners. one of the -- can i have the overhead back, please? one of the issues that was raised at the initiation hearing

had to do with the size of st. luke's hospital. i am going to paraphrase from a letter you may have seen written by dr. katz, garacia's predecessor. it was said that a smaller one could be built. this makes sense because one would think we would want an equitable distribution of hospital beds across the city. however, that is not really feasible because highly specialized services cannot exist in all areas of the city. for one thing, it is because there are not enough specialists. secondly, to be very, very good at something, you have to do it a lot. there is not high demand for every service -- every possible to maintain competence. additionally, when people are very sick, they made services from a range of specialists, not just one, and they need to be available on site at the time needed. this is a reason why some large

hospitals, such as the mayo clinic, have a broad range of services at one place. with hospital planners, that you should have community hospitals that are widely accessible and connected to a single specialty hospital, where people who are too sick at the committed to a hospital can rapidly transferred to. how does that impact the viability of st. luke's? the reason the committee did not recommend this for a rebuilt st. luke's is that they felt that the right bedsides needed to be based on demand. it does no good for a hospital to have more beds that will be occupied. by making statements and it will part -- and into parts, we do not have to worry that is viable on its own, but rather the viability of the whole system is what is at question. also addressed by you at your last meeting was the issue of mental health and psychiatric care. i thought it might be helpful to

talk a little bit about hospital-based mental health- care services to give you a little background. psychiatric emergency services is help people in psychiatric crisis entered the hospital system. psychiatric emergency services are provided only at san francisco general hospital here in san francisco. patients are often brought in by law enforcement under what is known as a 5150, which is when they are deemed a danger to themselves, a danger to others, or gravely disabled. patients are taken by law enforcement and others to the closest hospital emergency room. of the patients at san francisco general hospital that way, 30% are admitted to psychiatry. however, the majority of patients are waiting to stabilize on medication or are awaiting transfer to another type of treatment program that is more appropriate for their needs. the next level of hospital-based

care, psychiatric care, is acute inpatient psychiatric care. this is an indication bed in a hospital. the many hospitals provide psychiatric care, talking about this specifically since this is the most talked-about. there currently operating 54 psychiatric beds, acute psychiatric inpatient beds in san francisco. while those psychiatric beds are often filled to capacity, the vast majority of those patients could receive a lower level of care. the acute psychiatric beds on monday of this week, only 1% required acute-care. that means that 99% of the patients in those beds are eligible for other levels of services if they were available for them to move into. it is also important to note that the hospital does not get reimbursed for acute-care patients that do not need acute

care. these non acute patients remain in the hospital because they need to stabilize on medication or because they are waiting for another more appropriate level of care, much like the patient waiting. lastly, i want to talk about the other hospital experiences with psychiatric care. acute in patients psychiatry is provided at san francisco hospital, including st. francis, st. mary's, and also b. langley porter psychiatric hospital and another. all of these hospitals have acute beds that are operating below capacity. as mentioned previously, hospitals also receive psychiatric emergency patients in the emergency room when they are on condition red, and, of course, patients with psychiatric disorders may also present in the emergency room, not routed through the psychiatric emergency services. as with san francisco general and another acute unit, patients

in the emirate since the rams of these other hospitals, whether because they are on diversion or because they presented in some other way to the emergency room, the majority of these patients need to stabilize on medication or need to be transferred to a different type of treatment program. so the tick away here is that it is not really more psychiatric beds that are needed in san francisco but rather a lower level of care that is an appropriate place for people to stabilize or wait for transport to another type of treatment program. as i mentioned previously, there are 18 licenced inpatient beds at the pacific campus, which serves all the campuses, and that will continue after the rebuilt projects are complete. the draft development agreement amendment does not propose to change that. rather, it addresses the need i just expressed to create additional options for those hospital based psychiatric

services i just described, whether acute psychiatric services or another. the amended to limit agreement specifically allows for the innovation fund to support partnerships with the liberal health service providers to support community-based alternatives to inpatient psychiatric care that allows patients to receive services in the most appropriate and least restrictive setting. under this model, a community- based urgent-care center will be available 24 hours a day, seven days a week to accept patients who may be in need of high level services, such as medication support or counseling, but who do not need to be in a hospital to receive these services. the urgent care center, which currently partners with san francisco general hospital, is a good example of what we are envisioning. it was designed to assist san francisco general and other hospital emergency services by

accessing patience with psychiatric crisis that do not need hospitalization but are currently taken there for evaluation. this is an alternative to hospitalization providing comprehensive, 24-hour on-site services. they have two components. domenica's staffed urgent care clinic and a short-term crisis residential treatment program. the clinic serves individuals in psychiatric crisis that do not require hospitalization or involuntary treatment. they have a position on site or on call 24/7, and patients generally stay for up to 24 hours. once they are stabilized at the clinic, patients may be transferred there, which is a short-term residential treatment program located on the very same site. the average linked -- length of stay is three days. they both provide crisis intervention, medical support,

psychiatric counseling, assessment for the next level of treatment, and referral to that treatment. now, i'm going to turn the situation over to the financial officer, greg wagner. >> i am not gregg, but he will be up in a minute. commissioners, we wanted to go over the st. luke 0 -- with you again because it is such an important central part of the agreement. per the development agreement, if they open the new cathedral hill hospital, they must first open the new state with a hospital. excuse me. once they open six weeks, they must continue to operate it for 20 years as a general acute-care hospital with an emergency room. the on the way out of this is it operating margin goes below 1% for two successive fiscal years. please note that this is the operating margin as a whole, not just six weeks, and in a moment, greg will be showing you some

historical data on that figure. the operating margin is simply the proportion of the company's revenue that exceeds its cost of doing business. in the case of cpmc, which as a nonprofit does not assure holders, these are typically reinvested in the business. we will show you some historical data. the effect of this provision on the agreement as if their financial health were to start to decline, they would use savings elsewhere, so what i would like to do is call up the chief financial officer at the department of public health, gregg, to go over in more detail with you some of the aspects of this. >> good morning, commissioners. chief financial officer, department of public health. so as ken said, i have a little bit of data on the screen in response to a specific question from commissioner borden asking

about the metric, but in addition, i will talk about responses to some other questions. you asked about what the context of these metrics is. as you can see from the chart on the screen here, over the last 10 years, their operating margin as varied between 8.7% and 19.5%. it has been significantly above the 1% operating margin metric that is set forth in the development agreement. just to put that in a little bit of further context, one of the things that we wanted to do as we were developing this agreement and this metric was not just where they are now but to try to look at where the financial industry standards are for evaluating the financial health and organization. so as part of this process, we looked at quite a bit of data, and we brought in some outside help to try to provide some

financial industry benchmarks. one of those benchmarks is illustrated a little bit on this slide, and it has to do with what the relationship is between the operating margin and the credit rating of hospitals, so as part of the database which does credit rating, thousands of companies and governments around the country including hospitals, they have come up with a metric which is the average operating margin for institutions at various credit rating levels, including hospitals, so just to put these numbers and a little bit of further context, you can see there are two points here on the slide. the first is the average operating margin for a hospital rated aa, which is a very solid credit rating. it is not at the top of the range, but it is a highly

stable rating. it is investment grade, so that is about 4%. there is room for their operating margin, a significant win for that metric to decline, in which they would still be in that range of fairly stable financial condition. beyond that, and the second point on this slide, the average operating margin for a hospital is rated bbb, which, as you know, is at the low end of investment-grade ratings. that is actually the lowest investment grade class. once you go below that, you are in non investment grade, or some call it junk status, but at that level, bbb, because it is at the low end of the spectrum, that is an indication that the financial market is having some pretty substantial issues.

on average in the movies data, the operating margin metric, on average for those types of hospitals is at about 0.9%, so that is right near the level that we had agreed upon as part of the development agreement, so, again, the point of this is just to indicate that that 1% threshold is not simply pulled out of thin air, but we try to tie it to some financial industry benchmarks. the next slide, to talk about how the operating metric works, we talked a little bit about this last time, but just to add a little more detail,