if it is a very transparent process so that the vendors and prospective subtenants understand the process and can see it so that it is fair and equitable. >> -- supervisor chu: why do we go to the budget analyst report. >> madam chair and members of the committee, we point out on page 8 of our report that subsequent to the announce stabilization date, it is the first day of the first month after completion of all of the capital improvements, after which net revenues are positive for three consecutive months. after that date, the san francisco market corporation would be required to pay the city rent consisting of net revenues so that would be gross revenues last operating expenses

in any debt services and its net revenues would go to this city's general fund. on page 5 of our report, we point out as summarized in table 3 -- on page 9 of our report, the capital improvements total estimated cost are $107 million, over a 20-year time frame and those are further itemized in an attachment on page 21. by golly, we point out on page 11 that because of various unknown factors -- finally, we point out on page 11 -- this includes how much revenues at the city would receive which is still an unknown and we consider

approval to be a policy matter for the board of supervisors. supervisor chu: thank you. just a final question -- with regard to the revenues that would come in, from my understanding, the revenues would accrue to the city or accrue to pay for debt service is is generally as i understand that net revenues. what effort expenses the produce market incurs would be netted out of iran collected from folks who do not participate in that area. a key to maximizing how much revenue the city gets is making sure expenses are low or reasonable so we can see as much revenue as possible. how is it the city has a mechanism to make sure that is washed over? >> twofold -- there are

definitions of what is extensions and the process that allows the city to intervene if we see an unreasonable expense. i referenced a couple of associations that describe what the best management practices are for facilities. this is a very niche organizations in terms of produce markets. there are not a lot throughout the country and we use the international facility management association as our best metric. they will describe what is an appropriate expenditure and what an inappropriate expenditure. we have that base line to tie to. second, the history of the corporation and how it has survived so far is important and i would like michael to describe the current staffing model at the corporation. i think that will tell the story about the commitment of this organization to be as lean as

mean as possible. -- lean and mean as possible. >> as john indicated, the market has a strong track record of operating at the market. the city organization and merchants association books are certified an audited each year. as far as the culture and the dna at the market throughout, it is very lean. there are not any developers involved with the project and the development fees. all the dollars at the markets that the market. there are no shareholder dollars that go out of the market.

it is a very difficult business, we work in the middle of the night, there's nothing glamorous about it. that falls over to the market office and a bed nature of markets throughout the country are run in a very lean ways. >> -- we have the metrics and comparisons -- supervisor chu: we have the metrics and comparisons for best practices but the city has the ability to override or not approve budgets, it sounds like? >> an overall review of both construction and the budget in the sense of reviewing the leasing schedule which speaks to the anticipated revenues and expenses, so the city administrator or delegated authority, we have oversight,

ongoing oversight responsibilities to insert ourselves if we find something that needs to be cured and there is a process to cure it. hopefully in a positive fashion but worst case, even to the point of instituting new management. supervisor chu: thank you. any other questions from the committee quest for quite don't we open this up for public comment. i do have a few speaker cards. [reading names] if you heard your name, please come line up in the center aisle. >> good morning and thank you for hearing this. this has a certain irony for me to be here this morning speaking for the market. i have been honored to serve on the board for several years and i came to the redevelopment

agency when the embarcadero was being finished and had the opportunity to work on the new market than, which does date me a bit but is also an ironic ending that i get to come back and look at the new market being planned. the benefits of this project have been opened to and i want to underscore couple of them. the downstream impact will be on going because beyond the improvements there rejuvenation brings to the area, it will also address the emerging city food district that is a growing awareness that san francisco is not just a city for good food in restaurants, but there is a lot of innovation going on in the

food industry. we believe the market rejuvenation will have a catalytic effect on anchoring this emerging trend. the growth of the food industry was analyzed in the city and one of the recommendations of the city was part of that. there is also the issue of safety. there is traffic safety and cross traffic and local traffic and market trucks. this is going to be a huge plus for the neighborhood. i really want to underscore the fact that we have the need for these buildings to address safety regulations. thank you very much.

>> i am the owner of the washington-will co., one of the markets at the wholesale produce market. my business was started by my grandfather in 1931 and subsequently run by my father and uncles and i own it now. i have 15 employees. we have many customers throughout the city and we serve customers throughout the entire bay area. my father was in the position that i am in 1960 when he was working with the mayor to relocate the produce market from the building gave way to where it stands now. at that point, the deal was you guys get out of their and everyone is happy.

merchants realize that's not climate we're operating in now. we very much appreciate the attention the city has shown to less. at the mayor's office has been very supportive and help us along the way. the city attorney, the real- estate department, it was a hard-fought negotiations. we came up with something that's going to allow the market to continue to operate them provide the services that are of benefit to the entire bay area. to do so with a financial model that works for us and one that also works for the city. i would like to think supervisors cohen and maxwell. they have come down in the middle of the night to see what goes on there and it is great that we have district supervisors to understand what is going on and are trying to help us move along.

thank you very much. supervisor chu: thank you very much. next speaker. >> i am a small family farmer with my wife in half moon bay. it is a privilege for me to be here today. i'm a potential member of the new board of the san francisco wholesale produce market and also, i city councilman at the city of half moon bay and i have been chair of the san francisco regional water quality control board. i guess we you need is another board to serve on but this is a special board and it is so valuable for us as small farmers to be able to bring our produce every day, fresh and healthy produce to this market. it's a very unique situation. my wife is home talking in this high-tech age to the owners and buyers of our produce and it's very special.

i'm not bringing in tractor- trailer loads, bringing small amounts that keep the small farmer in business and there are only a couple of us left. i strongly support this move forward and i think you will be setting the stage for a terminal market that will be the no. 1 market in america. san francisco was number one on a lot of issues related to public safety and i strongly support you on this. supervisor chu: thank you for joining us in san francisco. next speaker. >> good morning, supervisors. thank you for the opportunity to prove it -- to provide comment on the expansion of the wholesale produce market. we have visited the market, 7:30 in the morning, was close to closing up. our staff has reviewed this proposal we strongly support the city's lease renewal with the

market and its proposed expansion at the site in the baby. the market is a major piece of the region and the city's food distribution infrastructure and the san francisco food industry supports more than 25 food businesses and employs more than six and a people, a number that will grow to over 1000 when the project is complete. without the capital costs to be paid by the city and over the long term, the market will provide a new source of revenue to the city through rent payments following completion of the proposed reinvestment project. the market is a good neighbor, having piloted some of the food composting in zero ways policies the city has rolled out as well as diverting a lot of its waste currently. what i want to say that has not been said is that this modernization project is happening in the context and

much less cost than a similar efforts in other cities. state agencies provided millions of dollars in loans and over $100 million in grants to build a new philadelphia wholesale produce market. new york city invested $110 million for the redevelopment of its fish market. in contrast, this proposal does not involve the city at the financing providing capital funds to the market. in conclusion, cities around the country working to develop these food hubs and hold on to the food distribution and aggregation facilities and we're lucky to have a strong one. we encourage you to support this proposal. supervisor chu: thank you. >> good morning, supervisors. i'm an owner and partner of veggie works inc. in san francisco. our business started in 1992 in

the bayview/hunters point area and within seven years, we moved to the san francisco produce market. presently, i have 56 employees. 80% of them live here in san francisco. it breaks down to basically 60% in the mission district, 10% in brno, and 20% are in the bay view area. we do this with quite a few major companies in san francisco. in sunset, we do the high- school and we are to produce supplier for city college culinary arts program. i go back to where we started. we started with seven of us and from there we worked all the way

of to our present employee count. we do help support our community with people that are working for us and within the last seven years, to the produce market really helps us being in the market and having the support of the produce market. thank you. supervisor chu: thank you. next speaker. >> good morning budget and finance committee. ♪ and you left your home in georgia, headed for the frisco bay ♪ and that you were hungry and you sure wanted vegetables today ♪ you are sitting on the wholesale dock of the day watching the

expansion get bigger today ♪ and give us a dime ♪ looks like it's never going to change but you can direct, i know you will do it ♪ ♪ make the markets fine ♪ ♪ i do believe you wanted it this way ♪ ♪ and i do believe it will expand bigger today ♪ ♪ it is all right now ♪ getting bigger every day ♪ it is all right now ♪ the farmers' market is going

to expand bigger today ♪ ♪ is all right now ♪ it is going to expand bigger today ♪ ♪ [bell] chairperson chu: thank you very much. are there other speakers? >> good morning, supervisors. my name is john r. and i'm here to talk about how -- john navarro and how -- i'm here to talk about how we are here to get many more back to work with the farmers' market. the bayview training academy is a 12-week academy where drivers receive their class "a" driver's license. a major component of the program

is that we offer a job placement assistance. that is where it working with the perris market makes a lot of sense. we will continue to work with others at the produce market. whiteford to getting unemployed san franciscans -- we look forward to getting unemployed center distance back to work. >> my -- my name is a.c. ♪ ♪ and i've been on this case ♪ ♪ i've been working on a case

with a lot of conspiracy ♪ ♪ i'm here working on the transfer of the tea -- dtis. they need to be here working on city hall. ♪ right here in city hall ♪ it gets so silly ♪ i'm here to show you something that has never been shown in san francisco. i have three website that we want to launch of that will show ♪ who is in control right

here in san francisco ♪ ♪ we have a mayor right now -- this budget procedure, you will see me here and you don't even have african-americans on the bottom line. you're talking about all these department heads. department heads here in san francisco need to be examined. i'm calling for a federal investigation here intemperances gough because of her politics. my name is a.c. and i will be on the case. chairperson chu: thank you. are there other speakers who wish to comment on item number five? the none, public comment is closed. >> i want to extend gratitude to

mr. rose, and especially to the produce market corp. and the folks who came out to speak today. i believe the concerns raised by our budget analysts have been added -- adequately addressed and i urge your support. supervisor avalos: this is actually a pretty exciting thing to be coming before us. i see there is economic benefit. i am curious about why there was not actually analysis from the comptroller's office about the overall economic impact that the wholesale food market would have. it seems that since it is a major economic engine and we are talking about going to a major lease, is there anything in particular that might determine when we will see such a report? >> dispatches, frankly, does not

lot -- rise to the level of materiality of the bigger impact reports. the role of items that we use is the annual change in economic activity equivalent of $10 million or more. this is not rise to that threshold. >> is that role in our charter, or is that what you determined? >> is part of the rules that we developed in consultation with the board years ago. each week, legislation is introduced to the board and we flag things as likely to trigger a report or not, and impose that on our website. but we do that each week. supervisor avalos: thank you. i am curious to have that information. but we can see that there is economic benefits drop the city.

gregg's and there are times that the board has requested that we produce even a cursory economic impact report on legislation below $10 million, but as ever -- absent that request, that is the general will we operate within. chairperson chu: i want to thank supervisor cohen for bringing this to us and for her leadership on this item. i would like to be added as a co-sponsor as well. supervisor kim: i do want to appreciate supervisor cohen's work on this, because i believe that the pdr industry is very important for the city to support and encourage. it is often complicated to do so. there were a number of questions that came up from it because it was a complex deal. but i do think it is important for us to look at city property

and surplus property to see how we can continue to support pdr and these types of industries. i know that has come up before in our conversations with both sf made and other types of manufacturing here in san francisco. we have lost some of those jobs in the past couple of decades. i look forward to more conversations around issues such as this. the only thing i would say is that as this continues over the next several years, i do think we will continue to build on local hiring. maybe i will talk to supervisor cohen's office about this. we can maybe work to increase those numbers. that would be the next step in this development that i can see.

thank you. chairperson chu: do we have a motion to send this item forward with recommendation? we have that motion. we can do that without objection. thank you. let's return to item number four. we have already called that item. is the mta here? >> thank you, supervisors. sorry for being late. what is before you is a proposal to authorize an extension of agreement for parking county related services not to exceed $4.6 million beginning august 1st, with the option to extend the term for an additional four years. the dollars associated with this project and where we are with the project, they have done a good job. there has been a reduction in the annual amount for this contract.

it is the additional card processing and wireless communication fees that have resulted in this we had significant attention on the rfp, but we only had one responsive bid. the other bidders failed to bid. they documented a couple of reasons. one is, they were having trouble finding partnerships required in the rfp. an san francisco specific requirements are so significantly different from other cities that they felt they were not able to produce those requirements. the mta board did approve this agreement am happy to answer any other questions you may have. chairperson chu: thank you. budget analyst report. >> but we point out on page 3 of

our report that if you compare the existing agreement with the proposed agreement, there is an increase of $959,000 or 11.5%. however, as ms. boros stated, if you take out the additional services in the agreement, there's a slight decrease in the agreement. this agreement was made through a competitive process. mta has realized an average of $31.3 million in parking meter revenue collections between 2000 two-three and -- between 2002-03 and 2010-11.

we recommend approval of this agreement. >> let's open this up for public comment. any members of the public that wish to speak? >> yes, my mother, grace murray, a check for 111. when i was little, she was a meter maid. and i used to seeing ♪ lovely recaps, meter maid ♪ ♪ where would that be with our view ♪ ♪ standing by a parking meter ♪ you are going to greet her ♪ she's going to take the money away ♪ ♪ oh, where would we be without you ♪ ♪ you worked hard every single day ♪ ♪ this is the last meeting of the budget and finance before you go on a break, so i would like to be the first to