is larger than we assumed at the time. but overall we got a reduction in spending of about $265 million or about a third of what we were assuming previously in 2010. so, it's expenditures of about 469 million versus 200 -- sorry, 791 million back in 2010. >> local visitors, that's 150, what was that number? you have millions and dollars here on the first category. when it comes to visitors you're talking about what visitors are going to spend? >> exactly right. >> and nonvisitors, okay, very good. >> the visitor numbers are based on a reduction in numbers from 2.7 million down to 2 million. 2 million is approximately equivalent to two fleet weeks spread over the course of the three-month event.

>> quick question for you. can you help me understand this chart, the total columns, 791 minus 4 68 is larger than 264. >> then you're correct. i don't have a good answer for you. >> okay. >> [speaker not understood]. big difference. >> thank you for the correction. >> it's my calculator. >> appreciate it. so, those numbers and presumably the correct numbers will have the same input/output model we put our expenditures into in 2010. so, methodology is exactly the same and the difference in numbers is due to the difference in numbers in expenditures.

>> is there anyone who has looked at this kind of a peer review or anything on this report? it is more of an advocacy drill than reality? >> we've tried very hard to be conservative and not make it an advocacy tool. our institute has a long history in reputation of being unbiased [speaker not understood]. this was shared with the city's chief economist ted eagan. he and i had a conversation about it on monday. i won't tell you we agreed on everything in it, but no two economists are likely to agree. >> i saw his notes there is not a lot of agreement on key features of it. i can go into that. >> i'd be happy to discuss it. in the results, i think you have the slide -- in the results, we found there's about one-third reduction in both the output generated by the event, decline from about 1.4 billion down to 90 2 million. a decline in the amount of

employment that result in 8800 to 6,4 81. about a quarter decline in employment. that's because a large part of the spending is sort of labor intensive remains intact. >> so, i do recall with the report that came out in 2010 there was a measurable bump in employment, but it was actually a lot of it was older time hours, a lot of it was extra hours. not every new hire. that was one of the key [speaker not understood] that came out. i confirmed it with the budget analyst as well. >> that may be true. that wasn't part of our report. although it may be in fact what happened. the jobs that we reported here are full-time equivalents. it's really a number of hours of increased employment that we're all submitting, not an increase in the number of people per se that were going to be employed. >> thank you. >> and just to understand, so, right now what we're seeing is there is going to be -- this word economic activity gets

thrown around quite a bit. you're projecting 90 2 million of economic [speaker not understood] to the city. >> correct. and we can take those results and run them through some basic formulas and provide our estimate for increased city tax revenue. so i submit, mr. martin has declined them to about 13 million. that's significant reductions in the transient occupancy tax, significant reduction in payroll tax. and those reductions are larger than the one-third reduction to overall expenditures partly derivative in large part by the number of sipped katz. greater numbers of syndicates leads to disproportionate increases in the transient occupancy tax as well as payroll taxes paid. ~ the retail taxes have also declined, but back out a third, same as decline in overall

expenditures. we have a net decline of about $10 million projected in city revenues. >> so, just -- mr. eagan talked about a 6.1 increase, million dollar increase in hotel tax revenue. it would require a 7% increase in hotel tax over a three-month period. what is your response to that, which is a significant increase over a three-month period. do we expect during this time that's what we'll have for the america's cup event? >> my expectation for rev par is that it would see a significant bump. having in addition between 5 and 25,000 people in the city on a given day could lead to a vastly significant bump than we saw during the world series. i believe that ted reported an increase of about 3.6% during the world series events. it would be my expectation that the america's cup will leave

the town and the defense would incur substantially larger increase he in rev par over the course of the event. >> [speaker not understood] five days of the event last year drew 150,000 people total. >> okay. >> that does president seem like the same as what you just said. >> no, the numbers that i was quoting are expectations for the america's cup. the number that you i believe just mentioned was for the world series. again, 2 million may be a highest matt and i don't -- given the work that i've done, i don't believe that to be the case. i don't believe that the world series -- there are probably others in the room better able to speak to this than i am. i don't believe the world series and louie vuitton cup and [speaker not understood]. the world series may at some point become a major event but

it's a relatively new innovation. as such it's probably not attracting the kinds of crowds from across the states, the nation or the world that the america's cup is likely to. >> thank you. according to mr. eagan, we're getting e-mail from him or through him, that there wasn't any real impact to the hotel tax last year for the world series cup, which might [speaker not understood] what you're saying right now. >> half of the world series events occurred during fleet week. so, measuring the impact of that literally impossible. unlikely to be meare an accurate predictor for what we'll experience for the america's cup, these numbers are high. i don't have an estimate how high, but significantly higher than reality -- >> thank you. >> through the chair, i just wanted to say there is the

harvey blue grass going on that october time as well and a number of other events. it wasn't just fleet week. but i just had a question. i know from the 2010 report that you did, i think it was an extremely rosy picture with the number of syndicates 15 and the 40 super yachts proposed. and i'm just wondering how you came to those numbers. and i know you said you've adjusted now down significantly to like a quarter of those numbers and the financial numbers, too. but did you look at san diego's america's cup and base it on some projections on how san francisco would be a little bit different? i'm just wondering how you came to that seemingly rosy picture that you gave us in 2010. >> well, i would submit that in 2010 it wasn't seemingly rosy. much of the community that looked at this report, that report agreed with us that they thought we were being relatively conservative. the numbers in terms of

syndicates and the other assumptions, the only thing that we had to if by was previous history. san diego played a role in that, valencia played a role in that. new zealand and other america's cup events played a role helping us accommodate to the number of syndicates we might expect. at the time we really had no idea what the global economic situation was going to be. we had no idea some maybe, but less of an idea what type of boat was going to be used and [speaker not understood] syndicates. there was a lot we didn't know in 2010 that we do know now. and now in this report we've incorporated the best information that's available to us in terms of updating that economic impact. >> i think it's important to note, though, again, having been somewhat close to the developments here, there have been additional events added. >> correct. >> for instance, the red bowl heath races, things like that. you can look at go from 15 boats to 4, that's a dramatic

decline in challenges. that doesn't at all complete the whole picture of [speaker not understood]. >> that's right. red bowl, jr. events we completely ignored that, the concert series we completely ignored that. that's not included in our estimates. that would be an add-on to the estimates here. >> is that right? >> yes. >> okay. >> all we've done is take what we knew in 2010 or what we thought we knew in 2010, correct it which in large measure meant reducing numbers. we did not add in the benefits of the world series events because figuring that out would be very difficult. and we did not add in the red bull, jr. challenge because again we have no history on which to base an estimate. the concert series is still relatively undefined. and figuring out the numbers of people that are going to attend the concerts from san francisco from the east bay, from outside of the region, very complicated

sketchy at best. so, we decided best not to include those things in our revised estimates. >> could you explain a little bit more about the concert series you're talking about and the red bull event, the youth event sponsored by red bull? >> sure, i'm probably not the best one to speak about those events. if somebody else would like to speak to those, that would be terrific. >> either mr. martin or mr. barkley can talk conceptually about what is going on. >> an important consideration for us was that we talked about having 55 days of racing through the summer of -- here in san francisco and that's what we wanted to deliver. so, i'm pleased to say that we still have roughly 55 days of racing through the summer. but to achieve it, we've filled a void with some specialist events. one of them is the red bull youth america's cup, an event

called the imagination of the world. there will be 10 plus countries represented with youth teams. we just had some trials here the last four or five spots in february. and the uptake from the media around the world is in actual fact a surprise in terms of how much visibility this is getting for [speaker not understood]. another event that we've added to the schedule is what we call the [speaker not understood] which is where very, very large sailing yachts will be sailing on the harbor. in the bay here, i should say, on the days between the america's cup races when they would take place in the seventh of september. so, in summary, fill a void with a bunch of other events that will in their own right attract people here to san francisco and the media of the world to san francisco. >> thanks, mr. barkley. >> yeah.

perhaps [speaker not understood] included and not included. so, aspects of the analysis that could affect it negatively or positively, thing that could increase the estimates of tax for the city, we revise the potential increases is again sketchy. that could lead to an increase of a million dollars in city revenues, the concert series. the 2012 world series revenues, we have been unable to calculate sufficient data on those events to really make any estimates. as well as some accelerated infrastructure investments. these shouldn't be included in economic analysis, but if they happened sooner rather than later, that's a benefit. things that could decrease the estimates, mr. barkley spoke about the hundreds of millions of dollars that is being spent by management. it's unclear to me exactly how much might be spent by management spending.

~ teen spending. america's cup is substantially different from prior americas cups. -- america's cupses. [speaker not understood] is a significant wild card. so, this is the update to the economic analysis i have. >> thank you. thank you very much. really appreciate your report. so, colleagues, i just wanted to make sure we had these two discussions. i know they were very long, so, i appreciate your patience. i want to appreciate the organizing committee folks for being here as well as mr. barkley, presentations from our departments, mike martin from economic workforce development. donna levitt from [speaker not understood]. [speaker not understood] from office of contract compliance and the controller. the status report is really to make sure we are living up to our commitments as a city

around applying the standards for workforce development small business inclusion. it seems like as a city we need to actually strengthen our effort to do communication about the agreements that we're making. i want to thank mr. barkley for his presentation and the numbers are correct in terms of workforce and small business inclusion. it seems like the event is having that impact. there are a number of people who spoke at the podium today from the public were able to express how their businesses have been impacted, improved, and a lot of employment occurring because of the america's cup event and that's really great to hear. it seems like on the workforce side that there's still a lot of bank work to do to make sure we are getting the maximum benefit. people feel they're actually getting access to jobs and moving forward. i know this is a place where we can actually apply this information to make sure where it's succeeding moving forward in the future. i want to make sure we take advantage of that with the city

to make sure l [speaker not understood] the office of economic workforce development is working hard to apply these ideas and principles. examine overall i want to make sure we have a successful event and all of us do. we want to make sure we're putting our best foot forward to the city. so, i want to thank everyone for applying their efforts to this end and thank you for this time to check in on the hearing. i would like to continue both of these items to the call of the chair. >> sure. if i could first just a few concluding thoughts. thanks to supervisor avalos for calling these hearings. i think for me in particular around the prevailing wage and the local hire, i think it was informative. i think there is good news within there and i think there is stuff to be worked on. but i think we want to focus on the future as a city. but i also want to take a step back. and i think a lot of the media recently has been focused on some negative aspects here, some really good aspects of the cup.

personally, i still firmly believe in the america's cup is going to be a great event for our city here in san francisco. i was not here when the board approved this deal, if you will, so i have a different kind of history and time frame. but as i look and kind of summarize all of this financial data and we have a lot of it today, the bottom line here is that we're going to have an event that is in all likelihood going to cost zero dollars to our general fund. we have an event that is going to create over $900 million of local economic activity and translates into approximately 6500 jobs, new jobs. a lot of cities would pay a lot of money to see that happen. and we're going to in all likelihood have zero costs it coming from our general fund. it is obviously accelerated a lot of projects along the waterfront that would have been done otherwise. and i think also the one thing that's so tough to quantify is a sense of civic pride that an event like the america's cup

does for a city. last summer, i can't tell you how many people friends of mine, family members of mine that saw the cloudless day of sale on the bay in san francisco with these colorful boats. i'm not a sailor, but i thought it was a spectacular event to watch. and seeing our city on national tv i think is nothing but a great thing and it's such a great light. even if we depth -- ~ didn't get another america's cup here, it will be talked about. i think our city will shine this summer. i think we're lucky to have it here. i know there have been ups and downs. there have been projections of teams of spectators of revenue. if we think about where we are going as a city in the summer, no cost to our general fund in all likelihood, $900 million of economic activity, over 6500 new jobs, and the chance to

showcase our city on the national, international spotlight. i think this is a great thing. and i would just suggest that as a city, you know, i have talked quite a bit with the mayor lately about his efforts and in fund-raising and helping him out. and i think i would hope that we would all get behind that. we want to make this a great event for the city, but the mayor is working very hard to make had i fund-raising goals. i think we should all be doing our part as well. and i really want to thank the people we talked about, mr. buell, case, all the people working on behalf of the city, organizing committee to make the city whole. i think we need to also say thank you and let's work together because we want to make this a great event for our city together. i hope we can move forward in that spirit of cooperation and see this through to be a great event this year. so, with that, if there are -- >> thank you. i do concur in your comments about the america's cup event

really showing the great part of san francisco. of course, within that is the collaboration of the city with the private sector to put this on and a lot of the small businesses that have been involved and the sacrifices they're making, commitment they're making is significant. the trajectory we have right now is there will be general fund impact if we don't raise enough money to offset that. and that is something i want to express at the very end of this, it's likely we will have general fund impact to this event even with new money coming in, it's money that won't be going to the general fund services and neighborhoods, but going to pay for the event itself. that is not what the original intent was about why the commitment or why there was a commitment to endeavor to raise $32 million, now 22 perhaps, but i just had to express at the end, this is going to be a remarkable event. if not it will be a remarkable achievement in san francisco that we expect, i hope it will not be that cost to the city

because that's what we agreed to in the beginning. thank you. >> and, so, i appreciate that comment. i'm just again going to respectfully disagree this trajectory we're on, we have three months to raise some million dollars. with the mayor's efforts, i hope we will all participate, all supervisors will on these efforts to raise the money. and also, we were just told we're not including the ac 45 events from last summer, we're not including the red bull youth events from this summer, the marsupiate races. these won't get squat identified, but from my perspective, i agree, we need to be watchdogs, but we need to be mindful and cooperate and put this on and get behind this. let's get behind this as a city and all put in our best efforts to make our city shine this summer. >> through the chair, i just wanted to -- and to my two dueling colleagues here, i'd like to thank supervisor avalos

for bringing this hearing, and supervisor farrell for looking at our mistakes. we have to support mark buell and kerry mcclellan and the mayor. i appreciate mr. barkley staying for the whole hearing as well and all the information that's been shared today. i didn't want to lose the issue of making sure that the back pay is addressed and that in the future as we look at private or private projects or other projects like this that we have a very clear system so that prevailing wages adhere to if that is a commitment that's been made. i think the suggestion from olse and others and from the public that testified, i definitely would like to see an investigation of penalties or some way to enforce, to go beyond good faith efforts to make sure that we have better monitoring systems and really can ensure that workers are paid their prevailing wage and we are monitoring and make sure this does not happen again.

so, i appreciate the hearing and look forward to working to the to make america's cup successful. >> okay. and we have a motion to continue to the call of the chair. and we can do that without opposition. [gavel] >> for those of you watching on 26, we'll take a five minute recess in between committee meetings. mr. clerk, do we have any other items on the agenda? he >> that completes the budget and finance committee subcommittee meeting for today. >> we are adjourned. [adjourned] >> hi, there, san franciscoans. here with another list of buzz worthy activities and i hope that you are ready to get the fun in the sun and pep in your step because the week of march is about the fun of times.

swing by north beach, and come to fiddler's green and dance, from 8:00 p.m. to midnight and plus enjoy the free, country dance lessons, come for the music this thursday night and if you are more of a dog lover than dancer, or both, come over to march meadows at golden gate park for the eastern egg hunt for dogs, the owners will analyze the dj while the pets analyze eggs, filled with prizes and an appearance from the easter bunny himself and on sunday, the international chocolate at fort mason and includes 64,000 wide of chocolate and enjoy 8 hours of unlimited tasting for premium

choices for over 40 master food vendors and buy your tickets early to assure the best price, and that is the weekly buzz, for more information on any of these events, visit us at sfgtv.org and check us thank you. good morning, everyone. wow! [ applause ] wow. we just won the super bowl. good morning, everyone. thank you for coming this morning. a few weeks ago here we announced that my intention

to appoint supervisor carmen chu and we made a commitment that we wanted to make her replace many appointment soon after we had time to talk with residents, businesses to get their in put the about a replacement. if i have learned anything i have learned that the residents appreciate the leadership. it's been very strongly felt by many people, from park side to ocean beach. it's just in credible how that large group has appreciated the

work. i have a strong push that continuity was important to the residents and the businesses in district 4. that they felt there was so much that the city had gone flew through and the district and certainly understood the team to help her legislatively, help her look at the district, implement and communicate and all the supervisors i want to thank and all the officials that are here all of them for their constant work with carmen and to know that they have a member of the team that would present that very strong continuity for the district. i spent the last

several weeks talking to the residents, having not only coffee but a number of different appointments. i talked to individuals who were interested in the position as well. i know we have one of the finest, legislative aids who knows the board and being a presence in the public finances and helped supervisor chu work budgets, help create the plan to establish the two year budget with our office but also really talk through district and the rest of the board members in understanding deeply what our budget concerns are and then i think on the district side truly representing the interest of this district and all of it's

diverse views about what it needed. so, i want to introduce my appointment today katie tang . [ applause ] . katie has lived in the district since she was 1 year old. that might have been 13 years ago. [ laughter ] you will note and i'm sure it will be part of the stories we'll tell that it was the same age as carmen when she was appointed.