footprint of that facility so we will be looking to use the time between now and when the port commission is asked to weigh in if a port site reaches the top of the list at developing a comparison set of criteria we would bring to you as a basis for making your decision on this project and certainly rent is something that we're always interested in. >> of course. thank you. >> i think this is a good concept. like my fellow commissioners i think they asked some intelligent questions and brad you just pointed out -- the port might not be the site that is chosen; right? so we have to right and still in the infancy stage. okay thanks. >> [inaudible] >> your mic is off. >> we appreciate you coming and

presenting. thank you. >> item ten new business. >> commissioners any new business? no. >> any public comment? >> move adjournment in memory

>> good morning, welcome to the regular meeting of the budget and finance committee. my name is carmen chu, chair of the committee, i'm joined by supervisor john avalos, and jane kim, we have phil dillon, mr. young, do you have any announcements for us? >> yes, please turn off all cell phones and electronic devices, copies and any documents that should be part of the file should be submitted to the clerk, they will appear on the october 16, 2012 board of supervisor's agenda, unless otherwise stated. >> colleagues, item number 1 i'm not going to call just yet,

they wanted to be here and present and answer questions, but they have a conflict at this moment, he will be later on in the meeting, item number 2? >> the resolution authorizing the director of public works to authorize the direct to have of public works to execute an amendment to the construction management services agreement with cooper pugeda management inc. for the laguna honda hospital replacement program. >> good morning, chair chu, john thomas, project manager for the laguna honda hospital replacement program, you have modification before you to increase the contract from 16.196 million to 16.805 million dollars to provide

construction management service to the remodel of the h wing, which is the existing facility at laguna honda hospital, work has been underway for several years, construction has extended beyond what was originally sants -- anticipated, this is to provide the funds for staffing for construction cost estimating and construction scheduling as well as administrative support to the program team for the remainder of the work on the h wing which we anticipate will be completed by the spring of next year. one other thing i would like to mention, the budget analyst has pointed out that modification 15 which was approved administratively brought the contract value to 16.6 million, so we are actually looking to modify the resolution here to reflect that, so the increase that we're asking for is just what is included in

modification 16 in the -- sorry, from 16694421 to 168051633. >> so, in that sense, you are in agreement that -- with the increase? >> yes. >> why don't we go to the budget analyst report. >> madam chair and members of the committee, as has been stated, the actual increase would be 111312, there would be no increase to the laguna honda hospital budget, it was previously budgeted for 584 million 946, 602, funds would be pregame -- programmed to

pay for that additional amount, this increase would provide funding for approximately 3 contractor employees through first calendar of calendar year 2013, that includes also the modification number 15 amount. we do recommend that you make that technical amendment which would result in an increase of 111 thousand 312 instead of an increase of 608, 969, so the not to exceed amount would also be revised if you accept our recommendation from 16 to 1694421, and that would be to or not to exceed the amount of the 16 million 805733, that's in the resolution tha, would remain the same, we recommend you would approve the resolution as amended. >> thank you very much. why don't we open this item up for public comment. do we have members of the

public who wish to speak on this item number 2? seeing none, public comment is closed. mr. young, i believe you had indicated the file was missing a few items. >> yes, i do need a copy of amends 1 through 15 and a copy of the renewal contract. >> mr. thomas, would you be able to provide that information to the clerk. you do have them? >> colleagues, we have this item before us, do we have a motion to move the item forward as amended. we have that motion and we'll do that without objection. thank you, item 3, please. >> item number 3, resolution authorizing the mayor's office of housing to accept and expend 2011 calhome grant for the california department of

housing and community development in a total amount of 1 million 500 thousand dollars and to expend program income from associated loan repayments to assist the low-income first-time home buyers and low-income home owners. er >> yes, good morning, teresa, mayor's office of housing, the resolution is to accept and expend 1.5 million as calhome state financing, we'll be using the program to assist with home buyer's payment assistance as well as doing rehabilitation for owner occupied units, this is our fifth allocation of calhome founds, its's an example of how we're using state financing in a very successful way. >> on this item, do we have a budget analyst report? >> no, we don't. >> any question fwrs the committee, if not, let's go to public comment for this item? are there any members of the public who wish to speak on

this item? seeing none, public comment is closed. okay, we have a motion by supervisor avalos, with recommendation we'll forward it, thank you, item 4 had. >> item number 4, resolution authorizing the san francisco department of public health to retroactively accept and expend a grant in the amount of 109 thousand 492 dollars from california environmental protection agency to participate in a program entitled certified unified program agency electronic reporting for the period of january 1, 2010 through march 31, 2013 waiving indirect cost. >> thank you, we have a representative from dph. >> good morning, supervisor chu and supervisors avalos and kim. i am sue con, the program manager for the waste program in the department of public health. we are certified by the california environmental

protection agency to implement and enforce several environmental programs including hazardous materials, hazardous waste, underground storage tanks and a few others, the resolution you have before you is to accept and expend for a grant from cal apa to receive grant money that we have collected from our regulated businesses from the past three year, each of them has been require today pay us 25 dollars a piece and we have been forwarding that money to the california environmental protection agency and the grant process is their mechanism that they have established whereby they will be able to redispurse that money, if you will, back to the locals, and we will be using those funds to do several tasks to facilitate the transition to electronic

reporting including training of some of our regulated businesses and purchase of field computers for our staff so that they can prepare notices of violation and inspection reports in the field, so that they can be more efficient in doing their inspections. >> thank you very much. i believe we do not have a budget analyst report on this item as well. are there members of the public who wish to speak on item number 4? seeing none, public comment is closed. we have a motion by supervisor avalos to send the item forward with recommendation and we'll do na without objection. item 5, please. >> item number 5 is a resolution ratifying an option for the lease of 9 thousand square feet of 555-575 polk street with mattison family

trust. >> supervisor kim, this is brought to us by you, would you like to say a few words? >> okay. >> good morning, chair chu, john, the director of real estate, this item is a bit unusual that you recently visited the question of renewing and expanding the lease for 555 and 575 polk street but as part of that tentative approval, there was a ratification clause that requested real estate with a host of support team here with me today, report back on potential uses of the 9 thousand square feet currently occupied be i the community justice center, should that center not be in existence during the term of the lease, what other potential uses could be placed into the facility, so i just want to provide that information, it is contained in our cover letter report to you

in your file, but just to recap, we've identified a number of potential uses should the property become available on the upper floor, the 9 thousand square feet. that ranges from the department of public health's weight and measures division, which is currently locked into space within fox plaza and expansion is difficult and they are in fact hiring additional staff with frankly very little room to place them. other alternatives include the treasure tax collector, includes the assessor recorder's office, you recently approved a short term lease for a project for their use that could have some expansion down stream, they would need space potentially for that or potentially at city hall. we mentioned the law library as an unresolved space matter, i don't want to get into the logistics of that today but note that as a potential, but we think the most viable

potential use is related to the fact that the building is half a block away from the fspuc headquarters, we have not been able to move everything into that fspuc and we'll be executing a hold-over for upwards of 13 thousand square feet to meet some of the waste water and consultant space needs that puc has, so clearly there is a demand for public space, the pricing of this agreement subject to this ratification item is similar to the cost of city owned buildings, so it is far below the market rate which currently according to the most recent report we have from cbre is running at about 30 dollars and 90 cents per square foot, this is at a fixed rate at 24.7 rate

per square foot, fixed until it concludes, from the march commencement date, that takes us to 2021 at 20 dollars and 47 cents a square foot so we're nearly a third under the market rate, so hopefully with that information, you have a comfort level to move forward and ratify the extension which is what we've previously discussed at the prior board discussion. i have available here folks from superior court, hsa, dph who can speak to any technical issues you *f you may have. >> for this item, i do not believe we have a budget analyst report, i want to open this up to public comment. are there members of the public who wish to speak on item number 5. seeing none, public comment is closed. supervisor avalos?

>> thank you, chair chu, just a question, currently that space is pretty unoccupied, it's pretty bare there, the second floor of the -- >> i'm asking whether any of the program related folks want to speak to that, my understanding is it is robustly used right now. >> good morning, supervisors, craig with the department of public health, so the facility in question, 555-575 polk street, one building, two floors, the one floor is used for court operations, the second is operated by the department of public health, the office of the city attorney, the office of the public defender, as well as as a different dph program of the violence intervention program. >> thank you, the last time i was up there, all those departments were involved in that space, but it wasn't clear that there was a staffing there

on a daily basis, so you're saying there is staffing there on a daily basis? >> that is correct. >> throughout the day? >> throughout the day. >> so, we're looking at now new uses as well, that could potentially be used for the upper floor space, we haven't settled on any, what those are going to be, correct? >> correct. >> when will we have a sense, we have these proposals, dph and other departments, the puc, when do you think a decision is going to come down on how that space is going to be used, is it a mere option of presenting to us what the options are going to but noted when we're going to be making a decision on who's going to be occupying the space. >> the intent would be to continue the current operation that has add -- add jay sense

si, delivering programs to the neighborhood is what we would continue to use until either that program ceases to exist and then what we're providing you is a number of other options, not related to the court lower level use that could occupy the space legitimately, need to be in the civic center area so it makes sense from the sizing and location standpoint so that we have options for alternate uses should it be unviable for some reason. >> thank you, supervisor. colleague, we have this item before us, we have held public comment and closed public comment, do we have a motion to send this item forward. we do have a motion, i want to thank the representatives who are here today, particular michael uwen from the superior court. colleagues, we will do that without objection? thank you, item 6, please.

>> item number 6, resolution authorizing the san francisco department of public health to submit an application to continue to receive funding from the ryan white act hiv/aids energy relief grant program, grants from the resource services requesting 36 million 118 thousand 233 in hiv emergency relief program funding for the san francisco eligibility metropolitan area for the period of march 1, 2013 through february 28, 2014. >> for this item, we have dean goodwin with the department of public health. or another representative of the department of public health, are you able to speak on this item? and we don't have a budget analyst report on this item? okay, why don't we skip to item number 1 and then we'll come back to this item. mr. clerk, would you call item number 1, please.

>> item number 1, resolution authorizing the lease of approximately 12 .72 acre property with 255, 420 rentable square feet of warehouse, office and parking lot space at 2650 bayshore boulevard, daly city, california from prologis for a 20 year term plus two five-year extension options at an initial annual base rent of 2 million 449 thousand 642 with annual increases. >> this was an item that was wfr the committee last week and we continued it to have a few questions answered today. >> thank you, good morning, chairperson chu, members of the committee, thank you for hearing this item and for the skej july adjustment. you had raised a number of

questions at the last meeting, we quickly put together a letter that we sent out on friday, while we got it out quickly, between friday and today, you haven't had a whole lot of free time to look at it, but i'm happy to address any of the specific items that we intended to cover in that letter that we hope were responsive to the issues that you raised. i do want to -- i'm happy to have staff walk through it if you would like. i'm joined with my real estate manager here, we have folks from auto return and one of our brokers here. i do want to emphasize if i may just again one point, and that is while i framed this last week in the context of this larger rel estate study and that was one of the questions of follow-up info and we put a little bit of info about that in the letter, even if we were

not doing a real estate study, no master planning, looking at our facilities, we would be right here with this issue regardless. as we described last time, we are in a lease situation at pier 70 that we need to get out of, the conditions at pier 70 are not acceptable working conditions for the teamsters that work there or for the public that it serves, they're not commissions that i think any of us would find acceptable for any city employees or other employees. the timeline to find new space for an operation this size, this large, we have a 12 month notice period and our mou with the port, it's taken us 14 months to get here on this particular lease, and finally, as i think you heard last time,

the total inventory of spaces available in san francisco and surroundings of this type are very, very limited and the type that are available are virtually 0, the real estate market is not getting softer as time goes on, prices are going up, so we don't see that we have an alternative, the fact that we're able to potentially with the board of supervisor's approval be able to execute this lease and make this move happen with only three months of overlap between the old lease and the new leases i think phenomenal, it's very good, and while, you know, we can all kind of wish in hindsight that we had struck right at the right time and we're able to have purchased this property that didn't happen, that there's not that opportunity, and we would have preferred it, but that opportunity is fot there, we don't see that property on

other properties now or in the near future, so we really think this is what is in our best interest for the mta, we don't have a plan b, it's a fair market value lease, so we think this is a responsible move forward as i said to you before, i would never come to my board or you asking to spend money in a way that i didn't think was the most fiscally responsible, you have a transportation system that is short on resources and i am carefully stewarding every penny that the tax payers and fare payers are giving us, i don't come in this lightly making this request, so with that said, i'm happy to speak to any issues from the better that need more explanation or to walk through it if you like or ask my real estate manager to walk through it, however you want to proceed. >> thank you, supervisor kim?

>> thank you, director ris -- ris khan, and i did appreciate the letter came to us responding to our questions, i thought it was incredibly thoughtful and while they did answer a lot of the questions i had last week, i think it's helpful for the sake of the public if someone could walk through the letter and in particular, even though you said you would be before us today regardless of this real estate master plan, i think having an understanding of the context with which this lease is a part of is important, and it would be great if someone could talk about that, i thought the goals are helpful and the understanding of why this lease was important and talking in a little more detail about the alternative sites that you looked at given kind of what i perceive as not the greatest price for this lease given what we were paying before, but completely understanding your concerns about pier 70 and its working conditions, regardless of whether you could stay there or

not. >> i would be happy through the chair, i'm going to start and provide the context from the perspective of this master plan and then i'm going to ask our real estate manager to walk through the sites they looked at and the other questions you had asked, so again, we initiated real estate master planning study earlier this calendar year or maybe even late last year and it was in recognition of the fact that we have a lot of real estate assets around the city that they are by in large not in good physical condition and that they are servicing our current fleet of about a thousand vehicles which we expect to grow over the next 20 or 30 years by 20% or so, so another 200 vehicles that we're going to have to accommodate and service. so, with that as a context, also with the fact that there

is some lease space that we currently are in that we would like to continue the process we've been making to get out of wherever we can, we did a competitive solicitation to come in, we are at the final stage, we have a final draft that we'll be bringing to your board i think in the next month or so, we're skenl puling meetings with officers who are interested, so the reason why we've been a little bit coy of putting all this out there, there's been some stakeholder vetting and processes including your offices that we want to make sure that we walk through before we put out publicly what we found to date. the good news is we went into the master plan with the

assumption based on the 20% growth in fleet size, we would need roughly 31 acres of land to accommodate our current and future needs. what we've come to the conclusion of so far with the draft final report is that assuming that we have this 12 acres that's the subject of this lease in our portfolio, we would need 0 additional space that by reconfiguring our existing space, we can accommodate current and future needs, again, assuming this lease is in place, so where this lease and this property comes into play specifically in that context, there are a series of moves that we'd be making to realign the operations to get more efficiency out of the spaces we have which is how we accommodate more vehicles nr the footprint, the leading contender in this space in addition to the long tow

training facility is [inaudible] which operates out of the presidio division, currently they operate out of an old administrative area, the actual bus driver training before they go on street happens out of pier 96 and it's on a crumbling parking lot that itself has a footprint that's not large enough for us to train all of the people in a class at the same time, so if you go out there, when the driving training is happening, you'll see there is a lot of standing around and one of our biggest constraints to improving our service delivery and not having open runs is our ability to increase our capacity to train people, this is our constraint at pier 96 for our bus training facilities is part of our constraint in terms of opening