presented to us, the statements made by the city that we are not majorly impacted by this -- by the libor manipulation, however there is an impact to the city and i think where there is an impact, really we have an obligation, either to our funds in our different departments like the airport, or to our retirement system beneficiaries that we actually pursue what we can in terms of recovery of losses, despite the difference. i also think that the city of san francisco, being a major city, major financial player in the municipal finance industry that we actually have an obligation as well to stand with other municipalities to make sure that we are supporting their efforts in any recovery as well. i will have more comments after.

want to go to public comment on the issue as well. uposo i have a number of cards o call for public comment. and folks hear their names called, they can come up in the order they're called. bahar taloo, -- yarborough, elizabeth a alexander, jesse mitchell and -- >> good afternoon. my name is with sciu, about the fraud, what it cost our communities and what we can do about it. i'm not sure i can get through it in the three minutes but i would like to follow up issues specifically on the other kinds of predatory deals. you have heard today about how the biggest banks rigged

interest rates on the world interest rate to increase profits. it's the biggest financial scandal in history. up to 800 trillion of financial securities, derivatives and loans are tied to it, with the counties and their pension funds. banks have admitted guilty and agreed to pay more than 3 1/2 billion. we need to get that money back. so you've heard that across the country there are already about two dozen lawsuits by cities, counties, pension funds that have taken action to recover their losses and without netting out their losses against any gains and doing it for the maximum period of 45 months, not the 18 months discussed earlier. finally today you have heard from staff that libor fraud has cost the city millions in losses at sfo, the pension fund, as our elected officials, the the board

of supervisors has the legal, moral and financial obligation to protect the city's resources. we urge you not to take a wait and see approach but rather take proactive and aggressive action to get that money back for san francisco. the facts are strong and unchanged even in light of the federal ruling last week. while the judge dismissed some claims like antitrust, other legal avenues to recover losses remain open. we can monitor the progress of the federal class academies lawsuits, but if -- action lawsuits but if we sit on the sidelines we will lose the able to recover our losses. we need to look at our options under state and federal law and do it quickly. every day we wait, every day we could be losing ability to recoup these losses because of the statute of limitations runs out on some of these claims and a number of class action lawsuits don't actually cover

state based claims open to us so the idea of waiting to see what happens with other suits don't cover the full extent of san francisco's losses. finally, we need to call on our attorney general to explore the possibility of prosecution and investigation of the banks under state law. we need to aggressively advocate for getting back every penny using all legal avenues and we know all public entities have suffered losses so we urge you to call on your counterports at school districts, public utilities and their pension funds to take similar action. once we add up the damages we are looking at hundreds of millions of losses to san francisco and millions more in damages to bay area taxpayers. >> supervisor avalos: just a question. could you say -- talk about are any attorney generals around the nation taking up -- playing an active role in helping municipalities and counties recover from the losses? >> a number of attorney generals

across the country have active investigations. and that's what we have heard so far. so i don't think publicly there's been any fines or any lawsuits filed. but they are in the stage of investigating to i think decide the way forward. and i think cities calling on them to be more aggressive and to jump in, given that there are some time limits would be helpful. >> supervisor avalos: in california do we see a strong action from our city attorney general? >> what we have seen is that they're investigating the issue. >> supervisor avalos: okay. anything else to add? >> i'd like to talk about the other kinds of deals. what we know is that libor fraud is just the tip of the iceberg. we're learning every day of illegal and unethical practices by these banks who peddle high cost risky deals to entities just the way they peddled high cost loans to unsuspecting homeowners which is labeled as

predatory loans. finance industry has been peddling similar kinds of deals to public entities pushing public predatory financing through deceptive and fraudulent practices and taxpayers are paying the price. like gouging on fees and interest rates an example is the san francisco airport interest rate swap that actually has cost san francisco taxpayers $100 million since 2008. those deals have in fact blown up. and to add to your point, supervisor earlier, the municipal finance market is today $3.7 trillion business. it is to fund central service, but instead we pay billions every year to the biggest banks while communities are forced to sacrifice and accept cuts to services and education. wall street gets a free pass and those least able to afford it have to fix the problem. we have to figure out the full extent on losses on libor fraud

and recover that money and the beginning of a thorough review of in he bad deals that should be renegotiated that could save san francisco taxpayers millions every year, and the willingness to renegotiate to ensure the predatory practices, whether illegal or unethical are put to a stop for good. >> supervisor avalos: thank you. what you stated in terms of the airport losses, in their swap is much higher than what the airport has said. what do you see as the difference? where does the difference come from? >> the way we look at it. we look at the swap contract that exists now. this deal was made to actually save the city money. as the staff said it was a hedge on variable rate bonds intended to save money. it was never supposed to be costing us money and has now cost us $16 million a year. i think the way staff was describing it was looking at having the swap and the variable

rate bond compared to having a fixed rate. we're not looking at that. we're saying looking at the contract that exists now, this is a contract where we made this deal because we thought it made sense. what happened was we agreed to lock in a fixed rate of about 3.4, to 3.9%. and then in the swap the banks would pay us back their variable rate at the time. this deal was made before the financial crisis so at the time, you know, we're paying about 3, 4 percent, around they were paying us back around the the same amount. now after 2008 when the fed cut rates to zero to bail out the banks the variable rate was dropped down to nearly zero. so since 2008 we are still locked in, the san francisco city is still locked in to about 3.4 to 3.9% and the banks pay 0.4%, almost zero. the difference between that spread is $16 million a year. since 2008.

and over the past -- if you look at the past five years that's almost $100 million. and we can't get out of these deals because there's a penalty to get out. what we're advocating is we should call on the banks to renegotiate this existing deal. we're not saying we should cancel a contract or refinance into a fix, but work with the banks to say we should lower the rate that the city's locked into because it is out of whack with the reality. these deals were based on expected rates, when we made this deal, precrisis. they don't make sense. they have done so in other places, as we said the asian art museum, there's actually an article that we can pass out that describes that there was in fact a renegotiation of the swap. we know that the banks have renegotiated in the city of richmond so we know that banks can and do renegotiate these deals, when we work to try to make that happen. and there's no reason why we shouldn't try, even if we can save 1% that is significant money for san francisco

taxpayers. >> supervisor avalos: thank you. >> thank you. >> supervisor avalos: next speaker please. >> my name is neilly yar borrow, a member of district 10. i am here to call on the board of supervisors and city staff to recuperate the money that the banks took from us through libor. that money blonks to san francisco and we need to get that money back. whether it's five cents or 5 million, we want our money back. the banks manipulated the interest rates to profit themselves at the expense of us. they rigged the system and thought they could get away with it, just like the banks sold homebuyers predatory mortgages that cost families their homes now we found they did the same to us and our government as well. all of us here in san francisco work hard every day, and the taxes that we pay from our

hard-earned money need to go to services for our communities. as our elected representatives, you have the legal and financial and moral responsibility to protect our city's resources, whether it's five cents or five million, we want our money back. now more than 20 lawsuits around the country have been filed, including at least nine public entities in california. the city of san francisco needs to join. therefore, i'm calling on you to find out exactly how much we lost from the libor fraud and take legal action to get our money back for san francisco. if it takes an extra hour on the computer, it is your job to investigate. as a mother with a daughter entering public high school this fall, i also want you to make sure our schools and other public entities investigate their losses and get that money back. again, i say, whether it's five cents or five million, we want our money back. >> supervisor avalos: thank

you. next speaker please. >> good afternoon, supervisors. elizabeth -- vice president of politics for sau local 21 and i work at the tenderloin clinic. over the last six years we have been sustaining terrible budget cuts. you're the budget committee. you will be looking at this again. we have sustained terrible cuts to rec and park services, children sss, homeless services, muni routes, bus routes, having cut healthcare, and health clinics have emerged and mental health have almost been decimated. in terms of workers their paychecks have been cut, we've restructured pension payments to deal with the losses. currently, our union is being attacked. it's 45 classifications are being asked to take wage cuts. and these are classifications that are mostly held by women and people of color. we were here talking to you

before about this. workers haven't blamed, services have been blamed. we've been cut and it hasn't fixed the problem. witbut here we have in front ofs the people who caused the crisis and it's time we have to go after them. we have to go after the people who caused this crisis. we have to look at what is the structure of public debt. we know that interest rates can be renegotiated. we always -- you always look at our side of the house as if we're the negotiable side but the public debt isn't the negotiable side. we need to go back to the people who hold our public debt, hold them accountable, renegotiate to a fair level. we did with the asian art museum. we got the money they owed us back. we have renegotiated some of those fo swaps. because they know that they're unfair and they've renegotiated them other places, in oakland, our union has joined with religious leaders and with other

community organizations to go after the sachs swap. there is unanimous council went after goldman sachs for the swap deal. this is something being done throughout the bay area, throughout california and throughout the country. we need to lead on this. it's our obligation. it's our obligation as financial leaders. it is our obligation as civic leaders. and, you know, we're coming into a budget season where we're being asked to cut again. i would actually, instead of having to be in front of here for the next several months what are we going to cut, what are we not going to cut, what services are we going to cut, i would much rather join together and look at the public debt and go after the people who can actually solve this problem. thank you 16r7b8g9sz thank you very much. next speaker. i will call more speakers. rebecca more row, ber neta adolf, david fleming, christy aceem, chris daly, brenda baros.

and seanie zin. >> good afternoon, supervisors. my name is jesse mitchell. i'm an acce member, action committee for community empowerment and a resident of district 11. i've lived in san francisco for many years and am frustrated by recent cuts to violates services and increased fees on residents. when i learned that the banks have been cheating us out of our tax dollars i felt we needed to prosecute them and demand they return the money. as a small business owner in it san francisco, i understand the importance of honest financial practices. once again, major international financial institutions have shown that they can't be trusted. we must hold them accountable for every penny they cheated from us, to speak from the heart here.

my first encounter with financial bullying was in junior high school. and it was about my lunch money. and i didn't really know what to do about it then. but i'm getting a similar feeling here that no one -- people are seeking a way to find out what to do about this financial bullying and i wholeheartedly encourage you to get every nickel back. we woke up recently to parking meters on sundays. so somebody could get $2 million more a year. well we've already talked about more than that, as a potential gain. so i think the impact of a little bit of money goes a long ways here. and thank you very much. >> supervisor avalos: thank you. next speaker please. >> hello, committee. ross rhodes, a member of ais, and i don't have a paper to read off. i'm going to talk from the

heart. you know, i appreciate what you guys are sitting here, trying to do. and i really think a lot of you, avalos, for stepping up, and really speaking out and doing what you're doing. that's why one reason, even though you're not a supervisor in my district i got out to get you reelected. so i commend you on this. but i'd like to say that, you know, this city is cash-strapped, and we have these bankers and libor and the rest making these dollars off of us. and we're here losing our programs that are essential to the city. our aids programs, our youth programs, our park programs, all have to do with your constituents in each district. and when we're cash-strapped the way we are and we see there is money out there that has been taken from us we can see in the analysis that every department

here in the city was, you know, hit by this. we can't take that attitude of wait and see. we have to step up and be leaders. and that's why we voted for some of the people that have won their reelections, because we looked at them as leaders. and it tells you that you don't have to have money to be a supervisor. and eric mar, you can -- to that because it was people power. it was people that seen the leadership in the individual and that's what made us come out and vote, and made us come out and walk the streets, even though he wasn't in our district, but he was a leader. and that goes for other supervisors that are in here. when you show leadership, you get people to really see and enhance what you can do for your community and your city. i'm a native san franciscan and i'd like to say that i'd like you to continue and go after these banks, the -- that's

holding this money. do it and bring it back to the city, and see how we grow, inner city-wise. thank you. >> supervisor avalos: thank you. next speaker please. if you've heard your name called, if you could please line up by the windows, the tv over there, that would be great. >> my name is ber neta adolf, i'm a member of aids. i'm also a resident of district 11, and here in support of supervisor avalos. i'm also here to call on the board of supervisors and the city staff to recoup our money. i'm a retiree, a public employees retiree. and our retiree system has lost money. also, we've always had a system that was self-sufficient. but somehow i'm told that the city had to step in. so when i hear that, you know,

gains and losses balance out, that's not good. because a loss is a loss. and i think we need to -- we need to fight for every penny that was lost. because these banks manipulate the rates, and we need our money back. so i'm just calling on you to do what's right. thank you. >> supervisor avalos: thank you. next speaker please. >> good afternoon. my name is david fleming, work with -- i'm a san francisco rep and work at san francisco general hospital as a registered nurse. born and raised in san francisco and worked for the city of san francisco for the last 20 years. since 2009 we have experienced multiple cuts in san francisco both in public healthcare and other services. as we look at what's going on with the financial system and the money they've taken out from us i urge the board of supervisors to investigate any form of fraud or any pleens by

which we can recoup money taken from the city. it's a great city and we need to fund our services and not allow the banks to take money away from us ever again. thank you. >> supervisor avalos: thank you. >> i'm rebecca morrow, the public health nurse and i live in district 5. i think about this kind of in general terms, in family terms. when you have small children, and they have done something inappropriate, they have a time out. when you have a kid in high school, and they're not making the grade, they're acting up, they're breaking the rules, their report cards, their sat scores and there are consequences for what they do. if you're an adult and u a dui and you hit somebody you don't just pay the fine but you need to be accountable to the family of the person you killed. what i'm seeing with the vague response from the city attorney's office is well we're

going to kind of look at things. we need to follow through. we need to go forward. i'm really sort of disappointed that san francisco wasn't leading the way on this and that we're waiting to see if we want to join someone else. we've seen too many service cuts. if u been to a hearing and heard these people, whose lives depend on a program that are just windd off the map it's heart breaking. now is the time to act. thank you. >> supervisor avalos: thank you very much. next speaker. >> my name is christy, and i'm a resident of bernal heights. i'm here to ask the supervisors to do everything they can to recover any money the city might have lost, due to the libor scandal or any other shenanigan the banks might have pulled off in the recent time period. we've seen an -- horrific

financial crisis leading into a recession, based on fraud, first of all, it was fraud, high cost -- based on high cost predatory lending. that in turn was bundled into fraudulent mortgage-backed securities. there's been fraud at every step of the way and thus far we've seen hardly any accountability against the banks. and it's really time, now, we have this opportunity to investigate any fraudulent lending at the local municipal level, and to recover that. it seems that a good bit of this money was perhaps in the interest rate swaps at the airport. i'm sure there are other areas where that has happened, and this is based on maybe those interest rate swaps help

bring -- provide insurance, and stability, but nonetheless, there were losses there because it was based against a much lower -- the banks actually were based -- had a much lower rate. so i think there's opportunity there if we do study, that we can see that there are a -- a lot of money has been lost and it's really time for the city to take a stand, because it's really at the local level where we can see -- finally have some accountability, some restitution, and we're only asking for what has been lost, what has been documented in our losses. we're not asking for compensation or other kinds of restitution. so i do hope you'll take action there. thank you. >> supervisor avalos: thank you. next speaker please. >> hello. i'm sherry zin from sciu1021.

a long time ago when i was a little girl my grand papa told me don't loan people money because you're not a bank, you know. i still believe in that. i'm 51 years old today. so i find it pretty unjust when, you know, cities and counties, or even banks treat me as though i am a bank. one of the supervisors, sean elsbernd came to the union hall with all of the retirement and everything, when it was thought to be in crisis and drew all this stuff all over the walls and everything, and how we needed to come through, and we needed to help out this crisis and everything. to the point that the city-county helped make this a law for us to pay. now, it's presented in our faces where we've been horribly, horribly lied to about our

retirement system, and what was being done with the money. not only do i think it's your duty to research this area, and get this money back for us, but if you don't, i think it's a big shame on you. i love working for the city-county of san francisco. but to me, this is -- it's a huge slap in the face if we do not take care of this. it only says to the rest of the world that, you know, we're a city that doesn't have any mocksy, and it's, you know what, we're a powerhouse. we're san francisco. we need to not see what other places are doing. we need to go out there and lead this, and say this is what happened to our citizens of san francisco, and we will not stand up for that behavior. thank you. >> supervisor avalos: thank you. next speaker please. >> hello. my name is brenda baros.

i'm a -- member out in san francisco general hospital and i've been before you guys a lot of times before. and everybody knows how i feel about us having to pay more money towards our pension. and when i hear about things like this, it infuriates many of the city employees because, you know, what we were told, and what actually happened were two different things. so we're still stuck paying all this money. so what we want to say to you is we hope that you guys will all get together and make sure that everybody, not just us, is paying their fair share. if the banks are ripping off money from the city, from our pension plan, which caused it to be in problems, abilityd then you have to come to us to get more money to cover the problems, then it needs to be fixed. and we insist upon that. because the city cannot come to us for more money, until you collect all the money that you

haven't collected already. i know even for healthy san francisco, they're still not collecting all the money from the businesses. i mean where does it end. when do those other people have to pay. you hold us accountable all the time. but when you going to hold all those people accountable too. so we're hoping that you do that. i'm going to be doing everything i can to make sure that the banks don't get away with this. i mean they've gotten away with it. too many of my coworkers have lost their homes behind those loans that they got, that they shouldn't have got. it's just outrageous that they keep getting away with this. the richest of the rich keep screwing the regular person. is we hope you stand up for the regular people and not the banks. and not the big businesses. we need somebody to stand up for us. so i really hope you do this. >> supervisor avalos: thank you. next speaker please.

>> i'm thanking you for your hearing. my name is ion hado, a resident of glenn park. i own a rental property. first blow, in 2008, generally regarded as due to malfeasance by the financial institutions, an economic collapse occurred and many of us, millions of us, possibly some of you, were stripped of your wealth. i am in jeopardy of losing my home, the rental property, due to non-payment for my mortgage. thankfully due to ace, i'm a member of the alliance of californians for community empowerment, that hasn't happened, but it continues to be a risk. second blow, the -- we're learning the