essential services and also make sure our infrastructure is in great repair. we are now looking at our sewer system improvement program and those same principles apply to how we go about dealing with the challenges. and so as annoy we -- you know we have a very old system and we've been pretty much operating it limping along and it time to make a new investment. we have invested bring the water to the citizens of san francisco but we haven't invested in taking the water and treating it and putting it into the ocean safely. that is the mantra that we are focusing on. as you know that we have some old infrastructure a lot of

a our sewer lines of very old. we do have some infrastructure that is by recent so, you are collapse on second avenue and lake street whiches in the the paper today. >> i'm just going to comment how up to speed an timely were you on that one. i was talking to supervisor ferrel in his district. it was pretty good that you were able to catch that image. thank you for doing that. >> yeah, you are right, it's timely, just to let you know, that is an 1898 sewer. just to illustrate that we have a lot of facilities that are in a state of disrepair and we

really need to address that i also want to thank ferrel for a great job in educating everyone there that we need to invest in infrastructure. it's going to cost money but it's something that we need to do. >> along with aging sewer lines, we have aging treatment facilities and one of the big ones that we are really focusing on is the southeast treatment plan which treats about 80 percent of our sanitary flow and our storm water and it has leaked in the past years. we have emergencies to keep this plant running. it's time we reinvest in this before it results in regulatory fine. that's our number one priority is to really invest in

that plant and also we need to invest in the community who has been putting up with a plant that's been deficient. the other is impact in climate change. we are really struggling with climate change and how we address it. we really studying it because it leads with a lot of local flooding and it wreaks havoc on our system. that's one of the challenges that we have before us. the next slide is we have a 20 year improvement program and identified $20 billion worth of need. we need to look at and prioritize what we need to move

forward on. the commission approved one which is $2.7 billion. so we very excited to really address this and tackle this phase one of the sewer system improvement program. our second priority with the puc that i want to preview you today is our rate setting. our net cycle. so what i want to do in the next slide is go over the time lines because we have to start early so that these rates can get into effect. later, this summer we plan to have an independent rate study completed towards the end of the year we are going to do a rate fairness board hearing and then we plan to go to the commission in december later

this year and hopefully we'll submit to the board of supervisors around february so the rates can go into effect july 14th. we plan to do a lot of outreach and include everyone and why the rate will be increasing. we set rates for water and waste water and it's a combined bill. so we wanted to point out some key upcoming milestones in there so that's what they are. so the next slide, it's going to be heart doctor -- hard to see it. the area is what is already

approved a 5-year rate increase. the other one is a rate increase that we are proposing. if you look at the first roll is really water sewer 24 hour service. that is keeping the current staff to making sure the chemicals and staff and labor staff and if you look at the out years it's pretty much rising with inflation. the remaining portion of the rate increase is investing in our water and waste water system. we will probably really come back and talk to you about this and go in more detail. the message look at this slide is affordability. we are trying to keep the utility bill under 2.5

percent because that's the definition of the us e p a for each utility but they wanted to keep it under 2 percent of the average household income. that's what we are trying to accomplish with that. what i would like to do is turn it over to todd for the budget adjustments. if you have questions now, i'm willing to take it or if you have questions after todd's presentation. >> today, assistant general manager and cfo for public utilities. as the general manager explained this is a great time because this is the first time that we come before

to you ask for cost implementing savings. there is 5 items on your calendar. the first one is an over supplemental which is fully funded through cost savings already incurred and if we made through chair request. >> yes. mr. young could you please read the other items? 130364 [de-appropriation and re-appropriation - public utilities commission overtime - $71,016 - fy2012-2013]1303642.sponsor: mayorordinance de-appropriating $71,016 in salaries in the public utilities commission, hetch hetchy department, operating budget and re-appropriating $71,016 to overtime in the public utilities commission, hetch hetchy department operating budget in order to support the department's projected increases in overtime as required per ordinance no. 194-11, and requiring a two-thirds vote of all members of the board of supervisors for approval. 4/23/13; assigned to the budget >> yes. mr. young could you please read the other items? 130364 [de-appropriation and re-appropriation - public utilities commission overtime - $71,016 - fy2012-2013]1303642.sponsor: mayorordinance de-appropriating $71,016 in salaries in the public utilities commission, hetch hetchy department,

operating budget and re-appropriating $71,016 to overtime in the public utilities commission, hetch hetchy department operating budget in order to support the department's projected increases in overtime as required per ordinance no. 194-11, and requiring a two-thirds vote of all members of the board of supervisors for approval. 4/23/13; assigned to the budget and finance >> yes. mr. young could you please read the other items? 130364 [de-appropriation and re-appropriation - public utilities commission overtime - $71,016 - fy2012-2013]1303642.sponsor: mayorordinance de-appropriating $71,016 in salaries in the public utilities commission, hetch hetchy department, operating budget and re-appropriating $71,016 to overtime in the public utilities commission, hetch hetchy department operating budget in order to support the department's projected increases in overtime as required per ordinance no. 194-11, and requiring a two-thirds vote of all members of the board of supervisors for approval. 4/23/13; assigned to the budget and finance committee. 130366 agenda[de-appropriation and re-appropriation - public utilities commission overtime - $250,000 - fy2012-2013]1303663.sponsor: mayorordinance de-appropriating $250,000 in debt service in the public utilities commission, water enterprise department, operating budget, and re-appropriating $250,000 to overtime in the public utilities commission, water enterprise department, operating budget, in order to support the department's projected increases in overtime, as required by board of supervisors ordinance no. 194-11; and requiring a two-thirds vote of all members of the board of supervisors for approval. fiscal impactt4/23/13; assigned to the budget and finance committee 130366 agenda[de-appropriation and re-appropriation - public utilities commission overtime - $250,000 - fy2012-2013]1303663.sponsor: mayorordinance de-appropriating $250,000 in debt service in the public utilities commission, water enterprise department, operating budget, and re-appropriating $250,000 to overtime in the public utilities commission, water enterprise department, operating budget, in order to support the department's projected increases in overtime, as required by board of supervisors ordinance no. 194-11; and requiring a two-thirds vote of all members of the board of supervisors for approval. fiscal impactt4/23/13; assigned to the budget and finance committee

130367 [de-appropriation and re-appropriation - public utilities commission expenditures - $16,546,000 - fy2012-2013]1303674.sponsor: mayorordinance de-appropriating $16,546,000 in existing wastewater capital improvement program project budgets and re-appropriating the funds to wastewater sewer system improvement program budgets adopted by the public utilities commission. fiscal impactt4/23/13; assigned to the budget and finance committee 130366 agenda[de-appropriation and re-appropriation - public utilities commission overtime - $250,000 - fy2012-2013]1303663.sponsor: mayorordinance de-appropriating $250,000 in debt service in the public utilities commission, water enterprise department, operating budget, and re-appropriating $250,000 to overtime in the public utilities commission, water enterprise department, operating budget, in order to support the department's projected increases in overtime, as required by board of supervisors ordinance no. 194-11; and requiring a two-thirds vote of all members of the board of supervisors for approval. fiscal impactt4/23/13; assigned to the budget and finance committee 130367 [de-appropriation and re-appropriation - public utilities commission expenditures - $16,546,000 - fy2012-2013]1303674.sponsor: mayorordinance de-appropriating $16,546,000 in existing wastewater capital improvement program project budgets and re-appropriating the funds to wastewater sewer system improvement program budgets adopted by the public utilities commission. fiscal impactt4/23/13; assigned to the budget and finance 130366 agenda[de-appropriation and re-appropriation - public utilities commission overtime - $250,000 - fy2012-2013]1303663.sponsor: mayorordinance de-appropriating $250,000 in debt service in the public utilities commission, water enterprise department, operating budget, and re-appropriating $250,000 to overtime in the public utilities commission, water enterprise department, operating budget, in order to support the department's projected increases in overtime, as required by board of supervisors ordinance no. 194-11; and requiring a two-thirds vote of all members of the board of supervisors for approval. fiscal impactt4/23/13; assigned to the budget and finance committee 130367 [de-appropriation and re-appropriation - public utilities commission expenditures - $16,546,000 - fy2012-2013]1303674.sponsor: mayorordinance de-appropriating $16,546,000 in existing

wastewater capital improvement program project budgets and re-appropriating the funds to wastewater sewer system improvement program budgets adopted by the public utilities commission. fiscal impactt4/23/13; assigned to the budget and finance committee. >> all four items are cost savings provided so they are self balancing and particular over time savings as well as debt service savings. the capital supplemental for the northshore is to do tishl additional work and it's important to have that additional capacity come online sooner than later. that is fully covered through existing capital project funds we are asking you to reallocate. the next piece of legislation no. 5 is a consolidation of all of the changes and adjustments in year two of our two year budget and it reflects a reduction of cost in particular about half related to financed cost savings because of the early repayment that the general manager already pointed out. there is also a request for the release of the reserve for the waste water budget at last year's budget for the two year budget for the city the chair also had the waste water department put on repair. so today we reported back to you on the updated scoping and time of the sewer system program and so there is also inside of that legislation a request then to release the reserves to 2013, 2014 for the reducing amount. there are amendments. on page one of item no. 5 of role 11. there would be an updated a reduction of another $40,000 and then to be consistent with the release of reserve's request on page 18 we can strike sentence row one through

four the reserve for the finances committee in row four and lastly, to make clear section 3.3 row 20 through 22. it should say which update today $241 million from finance committee reserve for the waste water enterprises fiscal year 2013-2014 capital budget. if there is any questions i would be haebl to answer them. i would like to thank you for your thorough review. >> thank you, as well as we have the amendment circulated to the committee members. colleagues, any questions on these items?

>> okay. thank you very much. we have our budget analyst report. >> on page two of our report we report that the heche water enterprises budget for over time is $854,000 so that's a deficiency of 71,000 and similarly for the water enterprise there is a projected shortfall of $250,000. we recommend that you approve the

proposed ordinance. on page 8 of our report allows the proposed use of 16$16 million $546,000 and $207,000 that totals $19 million you know the enforcement of the drainage project. we recommend that you prove this ordinance. this is justified. on item 5 did you want me to? on item 5, mr. chairman and members of the

committee, on page 11 of our report we report that as explained on pages 11 for a million dollars and that's for the repairs and $500,000 to compliance with regulations. as explained on page 11 in 12 of our report, a decrease in 13-14 capital budget $178 million. that's a deappropriation as noted to me that is certainly not an unusual thing where the

department is deobligating although some of that money will be used in the future for projects which are not needed at this time but will be expended ultimately in the future. you have 2 million development for the projects and $41,000 for street light improvement and programs noted on page 12 of our report, that includes 281,000 for fire is you suppression project. supervisors, again we've reviewed these request and recommend that you prove the proposed ordinance. >> thank you very much. >> colleagues you have any

questions for mr. rhodes on items 1 through 5. any public comments? is there any additional public comment? seeing none, public comment is closed. >> before we let item no. 1, do you have any questions for mr. kelly? seeing none. we have items 2 through 5 to act -- on. we have motions on items 2 through 4 together. can we take the amendments for item no. 5. the underlying item no. 5 as amended we can do that as opposition as well. please call item no.

continue item 1? >> that would be right. 130261 [health code - retroactive increase in patient rates for certain mental health services]1302616.sponsor: mayorordinance amending the health code, section 128, to retroactively increase patient rates charged for certain mental health services. 3/19/13; assigned under 30 day rule to the budget and finance committee.3/26/13; referred to department.4/8/13; response received.page 130261 [health code - retroactive increase in patient rates for certain mental health services]1302616.sponsor: mayorordinance amending the health code, section 128, to retroactively increase patient rates charged for certain mental health services. 3/19/13; assigned under 30 day rule to the budget and finance committee.3/26/13; referred to department.4/8/13; response 130261 [health code - retroactive increase in patient rates for certain mental health services]1302616.sponsor: mayorordinance amending the health code, section 128, to retroactively increase patient rates charged for certain mental health services. 3/19/13; assigned under 30 day rule to the budget and finance committee.3/26/13; referred to department.4/8/13; response received.page >> this item is revising which they reimburse medi-cal mental health services. in the past they were capped at a state maximum allowed reimbursement and recently announced a new rate methodology where they are going to reimburse us at interim rates. the purpose of this rate ordinance is to

provide mental health rates to capture the interim higher rates for this fiscal year. >> thank you very much. any questions. mr. rhodes. >> on page 18 of our report based on the states of the reimbursement rates estimated increased 12-13 revenues shown in table two and on page 19 of our report we note that, again that the i would show that the total revenues would be -- we do recommend that you approve the proposed ordinance. thank you. is there any additional public comment? seeing none, public comment is closed. we

have a motion to approve. so moved, we can do that without opposition. please call item no. 7. >> 1305 agenda[appropriati reserve to the public defender for salary expenditures - fy2012-2013]1301857.sponsors: campos; osornance appropriating $656,958 from the general fund reserve to the public defender for salary expenditures in fy2012-2013, pursuant to charter section 9.113, this appropriation is subject to a two-thirds affirmative vote of all members of the board of supervisors. fiscal impactt2/27/13; assigned under 30 day rule to the budget and finance committee.3/13/13; assigned to the budget and finance committee.3/27/13; amended, an amendment of the whole bearing new title.3/27/13; recommended as amended.4/2/13; re-referred to the budget and finance committee. >> 130185 agenda[appropriating $656,958 of general fund reserve to the public defender for salary expenditures - fy2012-2013]1301857.sponsors: campos; avalos and marordinance appropriating $656,958 from the general fund reserve to the public defender for salary expenditures in fy2012-2013, pursuant to charter section 9.113, this appropriation is subject to a two-thirds affirmative vote of all members of the board of supervisors. fiscal impactt2/27/13; assigned under 30 day rule to the budget and finance committee.3/13/13; assigned to the budget and finance committee.3/27/13; amended, an amendment of the whole bearing new title.3/27/13; recommended as amended.4/2/13; re-referred to the budget and >> 130185 agenda[appropriating $656,958 of general fund reserve to the public defender for salary expenditures - fy2012-2013]1301857.sponsors: campos; avalos and marordinance

appraratr section affirmative vote of all members of the board of supervisors. 9.113, this appropriation is fiscal impactt2/27/13; assigned subject to a two-thirds under 30 day rule to the budget and finance committee.3/13/13; assigned to the budget and finance committee.3/27/13; amended, an amendment of the whole bearing new title.3/27/13; recommended as amended.4/2/13; re-referred to the budget and finance committee. pursuant to section. >> this is continued from a number of weeks ago. >> good afternoon and thank you for rehearing this supplemental. when we were last here there were a number of concerns raised by the committee concerning not only our supplemental but the budget proposal for next year. and i'm proud to inform you that we worked both with the controller as well as the mayor's office ben rosen field and kate howard to address these issues. the first issue was out of temporary salaries and we are over spend negative that category and we had 5 employees who were being paid out of temporary salaries. what we've done is die to several vacancies that we'll have at the end of this year, we are going to delay hiring in those positions and also use some of those positions to place. most of which going to be vacated. the second issue related to salary savings and the department not hitting the

salary savings target. it's created between the employee leaves and the employee is hired. we have identified a number of employees that are going to be retiring and resigning at the end of the year and we've agreed to keep some of those positions vacate. normally what we do is when an employee particularly one at the top step is hired we bring to the lower step. we've agreed to delay hiring and put together a schedule. i won't bore you with the details unless you want to see it. it is essentially replaces employees in the position at a lower rate of pay and also delays hiring. the total amount of savings that we've

identified is $553,000 and that will address the salary savings issue. the 3rd issue which is known as a salary adjustment, again this is a target that was given to us by the mayor's office that we were not able to meet during this fiscal year which resulted in the need for the supplemental and we are still working out the details in that regard, but the mayor's office and they still have to discuss this with the mayor. is going to help us meet that shortfall in the next fiscal year. and again we are still working out the details but in essence the plans so fast two out of the three of the issues. the last issues we were close to a resolution and i think on our end we are in agreement that at this point we would have a supplemental to go

forward. >> okay. thank you very much. supervisor campos? >> thank you very much, mr. chairman and thank you to all the members of the budget committee for the work that you are doing on this budget. i just wanted to thank the public defender, i think that we have seen since this item has been introduced since the discussion that took place in committee and at the board of supervisors that there is a willingness to work on this and i appreciate the various steps that have been taken by the public defenders office. i think that the fact that they have been working closely with the mayor's office point to how they are really trying to deal with it in a responsible way and i hope this item moves forward. i think a lot of progress has been made on most of those issues and they are very close on the last one so i would simply ask for moving the

next item forward. thank you. >> thank you, supervisor campos. so, i guess there are a few questions. i under stand you are working with the mayor's office but pending outcome from there, as i shared my perspective from last time i don't like when the budget chair now the committee member when we approve a budget and it gets spent and we any knew this was going to happen. at the same time we have to pay for salaries that have been earned. my concern is for next year which is most important and i want to make sure what we are hearing from you is that you are not going to be back next year. >> that's right. it's what i

wanted to hear. anymore questions? >> supervisor reed. >> thank you, i want to thank you for working with the mayor's office to try to resolve this issue. i know it's been an on going issue and i was really concerned about the precedent this would set. i'm excited about the resolution looking forward to moving forward and i know there is a lot of wonderful attorneys and a lot of great staff and a lot of great programs that come out of the public defenders office and i wan to make sure that we are fund ing this office as a level before we get to a point to this level in the if future and we want to move this issue forward and this this to rest. >> okay. colleagues any questions? seeing none, we'll

move to the budget analyst report. mr. rhodes? >> actually we don't have anything else to weigh in on. as you know we recommended a reduction. it's my understanding that that's what the committee adopted the last meeting that's what's before you today. so the legislation before you today as we understand it is consistent with the recommended reduction that you accepted our recommendation at the last hearing. >> right. we don't have to amend again? >> that is my understanding. >> i just want to state that we are to convene for a special board of supervisors meeting. >> thank you. >> thank you for making that happen. colleagues any other questions at this time? seeing none we'll open to members of the public. is there any additional public comment? seeing none, public comment is closed. >> thank you for being here. i

appreciate the comment and i always want to say thank you for working with the mayor's office and budget office and looking forward to having it resolved. no more supplementals. can we have a motion to move this item forward with recommendation? so moved. >> okay. we have items no. 8 and 9 from our district attorneys office. i don't see the district attorney here yet. may we take a 5 minute recess to get our district attorney here? >> is it necessary for the district attorney to be here to move this item forward? >> i believe so yes. can we

take a 5 >> okay. good afternoon. welcome back to our regular schedule budget finance committee for 2013. mr. clerk please call item no. 8. 130273 [accept in kind gift - technical assistance - $250,000]1302738.resolution authorizing the office of the district attorney to retroactively accept an in kind gift of technical assistance valued at $250,000 from the open society foundation for the grant period of january 1, 2013, through june 30, 2015. district attorneyy3/19/13; received from department.4/2/13; received and assigned to the budget and finance sub-committee.4/24/13; continued.5/3/13; transferred to the budget and finance committee. 130273 [accept in kind gift - technical assistance - $250,000]1302738.resolution authorizing the office of the district attorney to retroactively accept an in kind gift of technical assistance valued at $250,000 from the open society foundation for the grant period of january 1, 2013, through june 30, 2015. district attorneyy3/19/13; received from department.4/2/13; received and assigned to the budget and finance sub-committee.4/24/13; continued.5/3/13; transferred to the budget 130273 [accept in kind gift - technical assistance - $250,000]1302738.resolution authorizing the office of the district attorney to retroactively accept an in kind gift of technical assistance valued at $250,000 from the open society foundation for the grant period of january 1, 2013, through june 30, 2015. district attorneyy3/19/13; received from

department.4/2/13; received and assigned to the budget and finance sub-committee.4/24/13; continued.5/3/13; transferred to the budget and finance committee.: >> okay. thank you very much. we have from our district attorneys office to speak on no. 8. >> thank you. this is not a grant coming to the city of san francisco. these are to support our efforts of the first of it's kind local sentencing commission that passed through here just over a year 1/2 ago. the specific responsibilities that will be completed by nccd are made by the city of san francisco co maybe through responding to members questions and providing briefings to all the membership and the public. in addition, they will also be providing support through our victims services. we are going to conduct victims services analysis to meet all the needs of the victims who are presented to our office. i'm happy to answer any questions that you may have about the technical assistance will provide and the san francisco sentencing commission. >> thank you very much.