all round. we are trying to make sure they're up to speed with everything happening and we have pulled in the cfo's and they are aware that transfers need to happen quickly so we feel confident and comfortable in terms of the conversation with regard to budget. the next piece is exactly what you were talking about, the governance structure. we're going to make a recommendation on what that structure would look like for this independent office. we want to be able to have conversations with the various entities and oversight committees that help to govern these three departments which would include the commission, the board of education, and out

of the department of children, youth and families, the citizens' advisory council. the governance structure is going to be another very deep conversation we're going to have to bring forward a recommendation and we are meeting again tomorrow for another few hours to have those discussions. we are also starting conversations with the school district and we have a new superintendent who's going to be taking the helm in july and we wanted to make sure richard had a full understanding of what's the city's intentions are and the next piece is the community outreach and engagement program to make sure all of our stakeholders are supportive of the recommendations we are moving forward as well as to start putting meat on the bones.

i want to thank trent, maria, laurel and rene for all their hard work. it has been some tough conversations but everyone continues to come to the table. everyone has been cooperative and collaborative and this has opened up a large book, the work we're doing jointly in the hope is to not have as many efficiency and we currently have and make the process a lot easier for the larger and i want to extend my gratitude to our stakeholders and the community. your patience in helping to move this forward has been tremendous and has helped us to focus our work and we are really excited we will be able to bring forward attempting to the larger community very shortly. based on what i have just shared with you, we are feeling comfortable and confident that

this is the direction the community would like to see us go in. we are taking into consideration the principles front seat pac and the advice we're getting from the commission, but we have three large agencies we are combining and we want to be able to serve all our kids and we're keeping that in mind. that is our target call and i'm excited and looking forward to continuing to move this project on the road with hopes of opening an independent office very soon. thank you. supervisor avalos: thank you. i want to thank you for all your work and grappling with these difficult discussions. i would like to thank everyone again for their work and i appreciate the free market have laid out. a lot of the framework we have

discussed as a community over the past year and i think it sounds like it's moving in the right direction. my biggest concern is that as we create this office that we make sure all of these different departments, their part is well defined and each one has a sense that they contributed to the hole and we have a new version of how we deliver the services with that in put and they feel satisfied with it. it sounds like we are getting their and i think it's a great credit to the work you have done. i also want to thank the stake holders to of come together to make this happen as well. we would not be here without their pushing and the consolidation of these functions is a key part to how we can be better city and county government. all of us working together will make that change.

what i would like to see if we can do is continue this side of and get the report back based on the movement through this next week. would -- would be okay coming back the following week to the five-member committee? >> absolutely. the work we will do tomorrow will enhance the plan even more so. at some point, we won to be able -- we want to be able -- the heart conversation we're going to have to spend a lot of time on will be the staffing component, what kinds of requisitions we have available at outside funding and support is a possibility. those pieces are starting to come together, but i want to continue to keep you abreast of all the work of three departments are doing because it is really good work they have

been doing together. when you would like us back, whether it's next week for the week after, we will keep you on -- in the loop on the work that is continuing to happen. supervisor kim: i don't have a question, just comments when this comes back to us in the hearing, one of the main things i like to hear about -- i think what was presented was excellent and i'm happy to see some much headway has been made over the year on how we can combine the work multiple departments have been engaging in around early in child care and early childhood education and i like that we are focusing city-wide but we have some priority populations we want to target, whether it is english language warners, a -- or those exposed to violence, my question is how are we going to use our limited funds to penetrate the target population

that what that means because we're not clearly going to be a cover every child. how does that work happen? one of my concerns and i know it has been expressed at the budget committee is that we see these surpluses and high levels of revenue that have been set aside. i know it's important to save for the future because we are anticipating a deep cut that the state level, but it is hard when we have families today when our offices are telling us individually that they cannot get into child-care and preschool so how we create a better balance of revenue? especially since we did pass proposition h and there's a strong expectation from voters that money would be spent. how to create that problem --

supervisor chu: why don't we open this item up for public comment? if anyone wishes to speak on this item, please line up in the center aisle. first speaker, please. >> ♪ when the budget is in the city house and jupiter aligns with mars and peace will guide the education and love and money will steer the scars. ♪ this is the dawning of the office of education. offices -- office of early education. early education. ♪ and will have lots of money and will have lots of education to and will have lots of good things in the city, what we?

♪ it will guide the education to imagination as early education. this is the dawning of the early education. ♪ early education. ♪ why don't you give them money a big thumb. early education ♪ supervisor chu: to any other speakers wish to comment on item number one? seeing none, public comment is closed. supervisor avalos: thank you for the presentation. there is great progress and we can keep things moving by getting that report back next wednesday. i would like a motion that we hear it in a five member committee next week.

>> there is a motion to hear the item or continue the eye of next week to the five-person full budget committee. just the members of the public know, we are heading into the budget season for enterprise departments begin next week and we will not have a subcommittee meeting the last two weeks of may. however, since this is a budget issue, i think that would be no problem hearing it in a five person committee. there is a motion to send the item or continue the item to the five-person committee for may 23. we can do that without objection. thank you. item #2. >> resolution authorizing bill leased by t-mobile west corp. of approximately 160 rentable square feet at 720 moscow street for the san francisco fire department.

>> good morning. i'm the acting director of real estate. the item before you today is involving fire station 43 at 720 moscow street located right across the street from crocker amazon. the station was built about 1970. this is a look at the facade of the station. the item today is regarding a cellular communication facility on the property. i have some pictures i wanted to show to give a sense of the fairly good job of the installation of this facility. cahoyou have to look very closeo see the antenna array. adjacent to the building is the

structure providing the power. a system of conduits alongside. atop the building, you really have to zoom in to see the facility. ordinarily, this would be a simple item to bring before you. their rate going forward is a market rate, however there is a bit of a tortured history sought want to give you the history of this agreement. -- the planning department provided general plan conformance at that time. a permit was issued to singular weiler -- singular wireless in

september of 2003 to allow the installation of the facility. at that time, there was no lease agreement between the city and cingular. there was also a command change underway at the fire department where the chief was on his way out and that current chief was on her way in, assuming command in january of 2004. in reviewing their real-estate records of the property, we have no evidence of real estate involvement until 2009. this facility was atop the fire station for approximately six years before negotiations commenced. that was outreach to the successor entity because what also happened, not only were the

staff changes on going on the city side of this transaction, but there was a merger between cingular and at&t. as part of that agreement, there was a requirement to spin off certain sites to other entities. in this case, this particular site was spun off to t-mobile and that was effectuated in january of 2005. we had a number of changes in operations on both sides of the fence, both the private side and the public side. in july 2009, staff began to outreach to t mobil in an effort to secure a complete return of funds owed for the time of occupancy as well as structuring the lease going forward. those discussions became increasingly difficult as time went on.

supervisor chu: can i ask you to pause quickly -- i believe that because supervisor avalos lives within 500 feet of this, i would like to make a motion to recuse supervisor avalos and we can do that without objection. thank you. >> in the summer of 2009, those discussions began and t-mobile was unresponsive to begin with. by 2011, we reached a corporate level where we began our earnest discussions of the structure of the agreement to take care of the original for what was then eight years of occupancy and the least going afford. what is before you today is a resolution of all that and is in some sense in lieu of a legal settlement. we have maximize the amount of money we could retain from the

firm to include not only rental structure from september 1, 2003 to current as well as an estimate of the utility charges the city incurred as a result of this facility and the electricity used. that total sum is a $318,989. that's a onetime payment to bring this to current. going forward, prospectively, this is a five-year agreement at $3,500 a month with three five-year options thereafter, each year a consumer price index in its letter of no less than 3% in no greater than 6%. the budget analyst has made a couple of recommendations with which we heartily concur. one is an amendment to the resolution to address the fact that in this case as in the case with most cellular to indication facilities, competitive bidding is impractical and has to be

reactive to industry needs of all in the network. i have tried both here and in my previous positions the approach of taking the competitive approach and offering the site and it doesn't work. the industry just cannot react to it. second, there would be further discussion of the responsibilities of the department jurisdiction to more actively manage their properties and be in improved communications with real estate going for. we believe it's a great opportunity to have that discussion and we're going to talk about surplus property issues and we welcome including this in that conversation. i'm joined by my colleagues in the fire department we would be happy to answer any questions you have about the item. supervisor chu: thank you very much.

appreciative was coming forward with an item that collects the back rent owed to the city and includes and deflation adjustment for the back rent and includes an estimated utility. i feel the city is being made whole for the years we did not collect rent. one of the questions posed in the report was the question around how it is we can tighten the oversight on these antennas. you walked through the transition occurring within the departments and organizations that may have led to things falling between the cracks. from my understanding, the real- estate department does manage and oversee a number of these antennas installed across city facilities and not some. do you have ideas about how the the real estate department to play a larger oversight role or is there a way to tighten it so we don't see many more of these issues pop-up? in these situate -- in this situation, it was resolved in

know it was fine for the city but we may not see that in the future. we would just want to avoid it in the future. >> in my tenure here for the last six years, we have improved our communication and coordination. that goes a long way to closing the loop of ensuring one regulatory arm of the city is talking to the proprietary arm of the city which often real estate represents. that is helpful where notices of violation or even before notices of violations are issued on city property. we of communication direct with that regulatory side of the house. this is one of those examples where permits were issued, the planning department issues were forwarded and there was no engagement or provisions related to needing the lease agreement on a proprietary side of this. we have strengthened those relationships and we want to

continue to do that and there are areas where we will need to make some improvements in that regard and i believe our departments are be more diligent but we need a bit of a carrot and stick approach to ensure better adherence to what is going on in the properties, particularly those departments that do not have a real estate arm. we have enterprise units with their own facilities folks that are in good shape and we have a tremendous role to play to assist our general fund family who have assets but have limited resources to manage and inspect those assets. i think we can were collectively to improve that. supervisor kim: i appreciate your thoughts. i know in the budget and legislative analyst's report, it was brought up that even in the evaluation of potential surplus the property that there is difficulty obtaining information from all the departments. i appreciate that she said many

cases are apartments don't have that level of capacity coming -- that use that many cases our departments don't have that capacity. one of these suggestions from our budget legislative analyst's report was that the director of real estate and what actually provide some possible amendments to our administrative code to help you to be able to gather that level of information. i think it is frustrating from a bird's-eye view that we are one city family that we cannot access basic information like where surplus property lies. in order to better generate value, it would be great if we could have that discussion on what that might look like and how we could assist you. i appreciate what you said about

what was going on administratively at the time in the fire department. i'm just curious why there isn't something automatic after there is approval. clearly there was a public approval process for these antennas and why doesn't that automatically trigger a lease step that follows? >> that the great question. that is a loop we have closed. you will note the problem was in 2003, about nine years ago and we now have a much better system of communication between planning and real-estate. we have been able to address these issues up front and in advance. i am hopeful we will not see like circumstances 10 years hence. >>supervisor kim: you address ts

talking about the market prices determinate by market gaps and coverage. looking at the monthly rental rate, there was a large jump between 2011 through 2012 at if you could explain that jump. it's great we are increasing the rental and not complaining about that, but does that mean we were undercharging in 2003-2011? >> the increase is reflective of a policy change real-estate instituted for revenue from cellular to indication facilities. the lowest tier was developed at $3,500 a month, so we have that jump and we expect the timing of the policy in terms -- we respect the timing of that policy. the higher tier is a $5,000 a month and that is for a very intense -- either unique

geography where we might command a market or in tents pedestrian or vehicular traffic so the system -- intense pedestrian or vehicular traffic. and we can charge a higher rate. supervisor chu: why don't we go to the budget analyst report? >> madam chair and supervisor kim, as mr. updike has testified in the committee has discussed, there would be back rent required from t-mobile to pay the fire department and in addition to the back rent, if you approve this lease, rental revenues that would be generated are estimated over the initial five years to be from

$225,000 -- the committee has also discussed the recommendation on page 7 where we recommend you amend the legislation to make a finding in the competitive bidding procedures. they are impractical or impossible and we recommend you approve this as amended and it has been brought out by the committee that we do recommend we get further input from the real-estate department on potential amendments to the it industry code for possible improvements to the procedures. supervisor chu: thank you. why don't we open this up for public comment? i only have one speaker card. if there are any other speakers who wish to comment, please line up in the center aisle. >> good morning. i am the outside counsel for t- mobile and i just want to let

you know i'm here to answer any questions you may have. t-mobile would prefer these kind of situations don't arise but they're willing to step up and cover the back rent and even going back to their predecessor when these problems began and we want to know that we are here and we wish to be a cooperative partner with the city, cover its debts and work in the future to keep sites like this which has been on the air for 10 years without incident operating in the city. thank you. >> ♪ look at what's look att. i can't believe it myself. then they need some budget money and you are going to give it some more help. ♪ believe it or not, they are leasing our air. i never thought we could be so

free. ♪ flying away on a corporation prayer. who could it be? ♪ believe it or not it's just mobile t. supervisor chu: are there any other speakers who wish to comment on this? seeing none, public comment is closed. supervisor kim: motion to accept amendments to move forward without recommendation. supervisor chu: we can do that without objection. item number three, please. >> i request we get the amendment by the end of the day if possible.

item three, ordinance authorizing the department of environment to accept and expend a grant in the amount of $403,000 from the california public utilities commission through pacific gas and electric company to study the impact that the replacement of old refrigeration equipment in san francisco businesses would have on energy usage and a peak power demand in the city, fiscal year 2011-2012 and fiscal year 2012- 2013 to reflect the addition of one class 5640 environmental specialist grant funded position at the department of the environment. supervisor chu: thank you very much. welcome back to supervisor avalos. we have a member of the department of environment here. >> supervisors, thank you. briefly, the california public utilities commission requires pg&e and other investor-owned utilities to spend ratepayer dollars to fund energy

efficiency programs to benefit their customers. since 2003, the department of the environment has entered into a series of contracts to implement an energy efficiency program in the city. quickly, through these programs, over 10,000 residential, commercial properties have received over $35 million in energy upgrades and have saved over $3,000 in utility bills each year. in 2011, the department submitted a proposal as part of an innovative pilot effort. the proposal was to look at retirement plans for commercial food service refrigeration, and it was selected and awarded $403,000. during the work that the commission has been doing, visiting watts of neighborhood stores, looking at restaurants, and trying to help them become more energy-efficient, we figured out quickly that we can change out lightbulbs. we can change our thermostats. and we can teach them a lot about