down because it's affecting the small businesses of san francisco and that's what the formula use business legislation was in there before -- was signed up for. thank you very much for your time. >> thank you. good afternoon, i own center hardware. center hardware has been in business -- >> excuse me, sir, if you can state your name for the record. i'm sorry, my name is keith gantner and i own center hardwarement center hardware the earliest records i have are from about 1880. so, we've been around a long time. i haven't been there quite that long. i did a little homework. i went on orchard supply's website and i went to their career page and i pulled up over 300 job openings at this time.

44 of those 300 were for corporate people, people are going to work in their san jose, in their main office, accountants, actuarial people, what have you. 19 of them was for sales lead full-time positions, full time 30 hours plus. all the rest were 29 hours or less, part-time, temporary or part time or temporary positions every, every job opportunity was a part-time or temporary opportunity. it doesn't say well to the company that they try and -- it's a formula outside of san francisco, they can get away with and not pay any benefits because they stay under federal guidelines. here in san francisco they will have to pay some benefits.

even if they have somebody working 12 hours a week, because i think the law says 8 hours. anyway, i thought it was unusual that somebody would hire mostly or seems like all to me, part time people. the other thing is i'm the third generation in san francisco in the hardware business. my daughter works in my business. she's the fourth. my grandchildren have grown up in my store, and hopefully they'll be the fifth. if we can maintain the character of san francisco with the community-based and supporting small business. if all these big businesses come in, we're all going to close and go home because we can't survive. thank you for your time. >> thank you. any further public comment? seeing none, public comment is closed.

commissioner antonini. >> thank you. well, this is an interesting case and i'm just going to give you some of my views on it. it ha been mentioned, an existing formula retail so you're going from one formula retail to another. and they do purport to hire 74 new people or employees who are presumably now not working. so, that is something in their favor. and the other argument in their favor, and i do buy this to some degree, there are people, for one reason or another, who presently live in san francisco and for price reasons or the type of product that this particular organization has, it serves a destination. they'll drive further away because they can get it at a lower rate or they like their particular products. it's almost like you see particular people who will drive to a women's clothing

store that doesn't exist in san francisco and they're going to go there because, you know, they like that particular product and there may be one really close to them, but they like the particular product. and it's not like people are going to shop at a local store, you know, and now going to go from the local store to this particular inch truetion. a lot of these people are already going to orchard supply or going to others outside of san francisco. that's just what people do. i've talked to a lot of people who do drive away for hardware-type services any particular reason. however, there are some reasons why this -- they do need to work a little more. first of all, i hear there's been a lack of outreach, particularly with the people on kate street, and not working with this loading thing. and i also have heard from the

council district merchants. they haven't outreached to them or to alliance for district 6 or various groups that have been in san francisco for a long time. and i'm not quite sure what's going to be worked out. but it seems to me that it's important if you're coming into an area that you should make contact with your potential competitors because it may not always be a lose/lose situation. you might have a situation where, you know, the store will bring people in and they won't be happy with the big box that they go to and they'll go across the street to the hardware store and find something that, you know, they like better because they get better service because they get -- i don't shop at big box stores for hardware products. i go to small hardware stores because part of what you get there is you get individual attention. you get a little counseling, you can ask somebody about how is this going to work, what do

you recommend, the kind of things that you get from smaller stores that you almost will never get from a larger store. so, to me, the price difference which i think is not that significant, it is significant to some people, but for me it's not worth going into a place and trying to find my way around and not getting personal help. so, -- but that's not true for everyone. so, i would probably be in favor. i'm not making a motion to continue, but i probably would like to see project sponsor work with the groups i mentioned and with the neighborhood over the next two or three weeks and try to see if we can answer these loading questions, the questions mr. miko brought up about entry into the store. and also see if we could have more of a cooperative attitude where orchard supply would refer people to some of the neighboring hardware stores and encourage them to go there if

they don't meet their needs or if they're looking for product they don't have, or even if they do. you know, there's probably enough to go around. we do have -- they've said san francisco a small city. geographically it's small, but it's very dense city. we've got probably 900,000 people living in san francisco or close to it and another over 100,000 in daily city. we've got people who are close by and i think there's a lot of potential business here. * so, see what the other commissioners have to say. >> commissioner sugaya. >> yes, i wasn't around for the home depot fight originally, but i understand what it was all about. i don't shop there. my wife and i have gone occasionally to look at products there and frankly have not been very satisfied, but that's beside the point i suppose. just to repeat commissioner

antonini's point, i think if people really looked at their purchasing experience and looked at what they purchased, they might find that it isn't that much cheaper to go to a big box store. costco might be a little exception, but i do -- i know that one of the advantages of local hardware stores is that you don't have to buy 15, you know, nails in a package in order to get five that you really are going to use. and, so, it's little things like that. the service the commissioner mentioned and other things. i think that the city has valued that kind of approach to small businesses and, therefore, we have formula retail. the thing that i find flawed in the staff report is one argument that there's already a formula retail store here that

sells home -- but they only sell appliances. it isn't like there's a broad range of things that are being offered at pacific, so, i don't think the two are comparable at all. and i do think that yet another hardware store -- i don't know, is home depot in the pipeline somewhere? [speaker not understood]. >> in the bayview, okay. so, that one's coming up. this one, we already have lowe's. there is target, but they're a little different. and i assume that since wal-mart is downsizing their stores and looking at urban areas, we're going to see one of those pretty soon also. so, you know, i go back to mr. miko's original comment which he opened with, which was we should really be looking at the formula retail aspect of this

first, and that's where i'm not too happy about it. >> commissioner borden. >> yeah, i think what's interesting about these hearing, if you know about the stores that existed, [speaker not understood], i live pretty close to all these stores. for example, i didn't know the discount builders was a place that i as an individual could go. i always assumed it was a contractor's place. speedies and other placeses in the neighborhood. so, it's been very illuminating for that sake. * i own a car. i have access to a car. i buy everything in hardware stores and small hardware stores and i choose to shop local. this dress in a chestnut street yni, the tag is from them. i am a person that believes in local. you know, what i struggle with is kind of like we want to save ourselves from ourselves so to speak. if people lived the ethos of that, it wouldn't matter if you opened up orchard supply because they would go out of business because no one would

go there, right, because everybody would only shop in their local store. it's an interesting thing. our formula retail legislation just reminds me that to a large extent people are hypocritical. they say that they want only local businesses and support local businesses, but then they're purchasing -- their behavior indicates that they'll go to costco or other places to get things because they get a better price or they'll even drive farther distances to do so. and, so, i always struggle with what is the right balance on these issues. the reality is for people who have means, who have cars, they're going to go to orchard supply or home depot, whatever, whether it's in san francisco or daly city or elsewhere. and balancing that against protecting our local businesses that are thriving in critical parts of our neighborhood. these are businesses we care about. we want to see them flourish. you know, they support our local families. i don't necessarily know what the right answer is in many of these cases because it's not always so black and white. i wish i knew more about the

causally it between what types of businesses directly impact others and, you know, when is it that your customer service can be so superior that no one -- people would pay a higher price for that, right? people buy designer label brands and they're really expensive but there's a quality people get in designer label brands that makes them buy those things. that's not true for everything. maybe that's not true for toilet paper or certain kinds of products. but for other products that is true. you know, on its face, i didn't initially have a problem with this case because it was a large building. i'm familiar with that area. it seemed like a fine use for that space if it were building in that net store, i wouldn't have been excited about it. i don't like the suburban style, big box retail in general. but i do struggle because i don't -- i do care about our local businesses. i don't know that whether i support orchard supply or not that really is going to make a

difference, but i do challenge us to think differently about that. i mean, how do we not have to save ourselves from ourselves? how is it that we don't -- how do we promote a culture that is a starbucks oregon charred supply, a neighborhood people don't patronize those differences so they don't survive, they don't want to come to san francisco? why is it that there is that tension and we basically have to try to stop people from doing that? i don't know. it's weird, it's an interesting kind of dynamic, but that's actually what we're asking ourselves to do, save ourselves from ourselves and, you know, i do believe that i see an impact and it's hard because necessary and desirable is our conditional use threshold. i don't know that necessary desirable improvement in this particular case. i don't know why -- it sounds like we have lots of other hardware related uses that exist, you know.

obviously desirability is very much a subjective terminology which i think is why it makes it funny when you have that for conditional use. but in term of necessity, you know, i don't see that there is a necessity. obviously if the building were vacant or there were other issues, it would be easier to say maybe necessity. but it's hard to find that. >> commissioner moore. : >> i think i was less focused on right or wrong until i saw this diagram. this is really what turned the discussion for me about saying is this location necessary? is this location desirable? and i've come to think that it isn't. i know myself that the advantage of smaller hardware stores actually neighborhood by neighborhood reflect the type of building need to replace a

doorknob or specifically difficult older plumbing fixture, et cetera, is served by though experts like here who have been part of the fabric of the city for a long time. and there are many formula retail stores who don't understand what your issues are because they just don't carry that any more. then, too, some kind of a form ulaic 20 washers, [speaker not understood], i'm not saying that is necessary and desirable somewhere else, but i don't think it is here. it is my continued real concern about to individually support and support the mixture of smaller business in san francisco because that is what makes our city livable. and that is for these people and all levels of society form that kind of social fabric that is supportable and viable for me.

i am concerned and unfortunately we are not discussing -- we can't discuss labor issues here. that the high percentage of part-time employment is indeed the business model. in the city where we are so much struggling, and as -- and that is relevant to this commission, finding affordable housing, finding builders who provide affordable on-site. * we are indeed creating a large populace who will because of the structure of employment, not be able to even scrape at the bottom of what is there. and, so, i think we're trying to pull in two directions. i am interested in finding neighborhoods and places where perhaps one of them is possible. but when i hear about pipeline projects, i have to really say not in this location. i unfortunately come with the obligation by then supervisor

and now assemblyman ammiano who discussed with me before i became a commissioner what my real belief on formula retail is. and by voting against this today, i just have to say [speaker not understood]. so, i am making a motion to disapprove. >> second. >> commissioner moore, you would have to make a motion of intent -- >> i am making a motion of intent. thank you for that correction -- to basically not approve this project. >> thank you. i apologize, i had skipped commissioner hillis. so, commissioner hillis. >> please stand by; captioner change

>> have you seen an impact from lowes. >> my name is keith, when lows opened up, we immediately took a 20 percent hit in our gross

sales. i mean, within a week, you could tell. the monday through friday, sales have come back. >> our saturday sales are still 20, to 25 percent down since they opened. which has cut 22 people from the staff on saturdays. >> thank you. >> so, yeah, i mean, i i think, i share some of moore's concerns, i have a hard time approving the use in this location, given kind of the comment and the testimony that we have heard. >> commissioner antonini? >> well, thank you. yeah, i have mixed feelings on this. i'm also a small business while dentistry and medical services are different from hardware, there are similarities. they could put a dental clinic next to my store and i don't care.

they are going to hire people that are not confident and do unnecessary work and under pay them and things like that. people know the difference and they come in and they know the kind of service and care that they get, and eventually they will choose you, but there will be some who will go to the clinic next door, because you know, the price is all that they care about and they end up with disastrous results sometimes because the care is not what it should be. and we are not dealing with anything as serious here. but it is still kind of is the same story. however, i do have a family member who, you know, always, i get criticized for going to a local store and buying a few razor blades and say why don't you wait until i go to costco, you are paying too much for them not that it makes that much difference, not that we can't afford for me to go and buy the razor blades, i can't wait for a time, a saturday or some other time when a long trip can be made to save a little bit on razor blades

along with a bunch of other stuff. there are people that have that attitude and you are not going to change them and they are going to be price sensitive and going to orchard supply or, i don't know where the nearist one is, but they will find one. they like the store and they will like the price. and i think that is the deal and also, i think that we really should allow competition, and allow people to compete with each other. and i don't think that, you know, they are necessarily doing anything unfair. they can charge a little bit less, but, i think in the end, people are better off with the individual hardware store and they are going to get the service that i spoke up earlier. however, i would like to see this issue, it is going to be, it is going to actually be quasi continued even if there is a vote to disagree.

an intent to disapprove. i would like to see a continuance, i don't know if i can get a second on that. we should have work between the district merchants between the orchard supply and try to get a working arrangement and they would be more cooperate. they presented that it was formed by a cooperative of farmer and it has changed a lot from there and i would be more supportive from there if they were a local firm if they are not based in san jose, even if they were a bit large local firm. that would be what i would say is to continue. >> the second. >> the motion to continue, actually takes precedence over the motion of intent. >> i did hear a motion by the commissioner antonini and a second by commissioner fong.

>> commissioner? >> i would like the zoning administrator on an issue that i think that we have not talked enough about and that is loading dock and the residential usage on kate street, fire and emergency access and issues that come into play and we don't decide that at least you have a basic elementary understanding of whether or not that would pose problems in the long run. >> the loading dock, as i understand it is been in existence, so therefore it is a non-conforming use in terms of being able to load it and unload in that area. they do have a customer dock in the front in the parking lot. the environmental review for this project stated, or it is exempt from the environmental review and there is not a traffic study or any requirement for that. as far as fire and loading, we

have not checked that, and that is something that is reviewed after the approval of the conditional use. >> i am going to oppose the continuance, we have the legislation that we are responsible for and we will not always, if we are not willing to up hold in this case, then i fear, i know that one case is not supposed to set a precedent, but it will.

i don't think that it is going to do something, although the orchard will talk to people merchants will say that it is not going to effect me and it is okay if i come in there and i can buy something cheaper. as far as the other issues, like loading, if we do pass it, we can take it up in, you know, just deal with it. >> commissioner antonini. >> i don't know if we are supposed to debate a continuance. first of all a month from today and if it is okay to speak to it. i think that we have neighborhoods, stores and there are, this is a neighborhood. and but, it is also a very busy

area where there is a lot of traffic, coming from other places, which has been brought up. and there might be in the area that might drive out of the city and there is room for both and there might be a way to work something out between the merchants and the hardware owners and orchard supply. it does not hurt to have the continuance and if we come back and they have an out reach to the neighborhood and the merchants, then, it may get disapproved. >> i will not be supporting, and i think that for me, possibly a way for us to standardize the way that staff

look at formula retail and we have these five retail that are standard and i have stuff use different distances that they look at or different criteria, different ways of doing surveys. i have seen a walking survey, or something called a windshield survey, i have seen it looked at in a commercial corridor or in a zone, i think that we should look at, maybe, and i'm open to what the standard actually is. but, look at a certain radius from the site or just something standard so that we can really start to get a count of how much formula retail is around. >> these are in the umu and these were in the formula retail district and so it was easy to calculate the distance on the nc districts because they are pretty linear and the

enus are gerrymandered. we did use the district and it is possible and that is something that we can speak to scott sanchez about and that radius map is not the district as the criteria states and i understand sort of the difficulty in assessing that. that is something that we could get back to you that i wanted to clarify that. >> thank you. >> commissioner moore? >> i like to go back to geary street corridor, a few years ago, the market was slow and large and previously a formula occupied space and the formula retail comes along and we immediately says that it needs to be filled and have the vacantcy and i think that in this area, we are much likely in the different building in a slightly different market and to have the department, also

from the application, look at potentially vacant buildings of this size and talk about higher and better use would be of interest to me because as the district transforms itself and becomes the umu and takes on the more desirable qualities of the most recent plans and i would like to look at these as not as fall back positions as formula retail but potentially the next generation of innovative store or stores that we could put into them. >> commissioner, hillis? >> just, on the continuance, i mean, i, if we vote, if we vote against the continuance and we vote for the intent to deny, when is that heard next week? >> we would bring it back to you commissioners in a matter of two weeks to give the planners the chance to draft something and get it out to you, if there was some sort of a time rest