>> okay. at this time, i would like to call the public comment on items number 3 and 4. but don't go away sophie because we are going to finish this up here. so do we have any members of the public who would like to make a comment on item threes and four? >> welcome mr. cornel. >> thank you, nice to be here, steven cornel of small business advocates i think that maybe looking at this broader, the purpose of the whole thing was to help and preserve the unique character of small businesses in san francisco. and keep it vital in a place to do things. and san francisco is only 49 square miles, and so i think, it is just keeping it for the neighborhood is looking at things too small of an area. and you come into san francisco, from the south, the first thing that you see, is on one freeway, it is home depot and the other freeway is lowes

and ha is what you see is the first big things coming into the city, the big boxes, you are starting to see some of that on coming in from the golden gate bridge, the walgreens and the gas station and ihop and not very much over there but it is sort of sets the stage on what we are. and if we are going to be or if this legislation was put in to make us a unique city to it preserve the small business, i think that we have look at things like the target store downtown being put in. or the one on masonic and look at it as a broad city, the impact on how it does in the whole city. one thing to think about. and the other thing that i don't think was addressed was, they had two different formula use and things that came up in the last year or two, and one was sherm an williams store that came in on polk street and another one was orchard supply that wanted to come in on

howard street or one of those streets and i forgot which one. and in both cases, the way that the planning department came up with how many other formula stores were around it or how many other similar stores, there was not a set kie criteria in the orchard supply case, the city builders was a block and a half or two blocks away and they were never counted as part of it, it didn't make sense, in the case of the sherm an williams store they left out a bunch of stores by jerry man did jerry man dering the area.

i think that has to be fixed a uniform thing that makes it reasonable. some things to think about. thank you. >> i need to remind that the public comment is at three minutes. >> any other member of the public who would like to weigh in on items three and four? >> seeing none, public comment is closed. and i would like to open this up for discussion. >> steven thank you for coming out tonight, and i think that we need to send the message out broadly that this is going to be an open discussion at a policy level now and frankly i have been frustrated with the fact that we are kind of dealing with this on a skirm ish basis and we need to address it at a policy level and so i am really hopeful that this is now, happening. and i think, you know, the world changes over time and so we are seeing some new anomalies that we could have no way of anticipating, when this policy was originally adopted and i think just in our discussions of vetting, some of these scirm ishes i know that

myself, i have vacilated between what the chamber of commerce has to say and what the merchants have to say and even what the press has to say and then walking these areas, myself to see what actually is it like to be in those neighborhoods and i know that being in dog patch as a business and being in south of market as a resident, you really don't know these neighborhoods unless you live there and work there and so it is really hard for whether it is the sfmta trying to do something street scape wise or the planning commission trying to do something from a planning perspective to kind of go, here is a new neighborhood that i got to assess that out and figure that out and it is difficult and so i think that, you know, minimally the conditional use process is got for the locals to dialogue and the legislator for the nuances of the neighborhoods so i am hopeful that we can deal with some of these issues at a policy level. i know that there will continue

to be nuanced challenges on a case by case basis and maybe this will give us a better opportunity and i know that we are committed in participating in the dialogue and i want to put out the call out to the merchants and the small businesses to participate in that dialogue as well. because if you don't show up, you really should not be complaining when you are seeing the results. >> that is the democracy. >> thank you. >> commissioner dooley? >> yeah, a lot of merchants have conducted me about this. and you know, all sorts of opinions, but, kind of what i take from it is that all formula retail is not the same. that i think that it is time to, you know, make some differentiations on looking at the geographic impact and we

need to see some small coffee shop or sandwich shop impact is going to be. and say, this big around. and then, you go, to somebody that has a parking lot, and they are serving a district, and then, maybe, i think that that examination of the impact potential impact has to be this big and then when we get to the really large formula retail like a target, then, you have got to take in consideration, it on a city-wide impact and i think that is a real problem in the years past that one size fits all in terms of realistickly how big the potential impact is going to be just based on what type of business it is, and i don't know whether it is best to deal with it in terms of square footage. you know, which i am thinking at least it is easier to define.

i don't know. i am not sure what would be the best criteria to put the potential formula retail applications into. >> i just had the comment that i do have usize regulations by district which often forces the discussion of the big box store. and that is usually where it comes up, so a location like the masonic location for the new target, for example, that trigger conditional use authorization for a number of reasons, including formula retail and also you size, and so that for example, would have come for a conditional use authorization, regardless of whether or not it were a formula retail location. >> so what i am sesing more is in terms of when you are assessing the geographic impact, i think that we need to, you know, refine that more, so that not everyone is being,

you know, examined in the same manner, because there are, you know, very big differences. and i think that if time to kind of reflect that. and you know, levels in some way. you know? i am not completely sure how to do that yet. but, i think that would be important. and also, in terms of, you know, we don't want to say eleven or more targets, would be okay. you know? that kind of thing, so i think that those levels have to correspond also in terms of, in terms of their impact you know, how many at the highest end, should be a maximum of the largest type of stores, or you know, maybe five 10,000 square foot store and one size does not fit all and eleven could be adjusted in some way, >> commissioner dwight?

>> do the size restrictions vary by district? >> they do, yes. >> i have a couple of thoughts on this and one, i am going to the first comment that i am going to give credit to jim lazarus at the chamber of commerce because this has got me thinking and that is the companies like levis and gap, who have subsitaries who do not or who are subsidiaries are not formula retail. and you know, this is san francisco, and their home and this is where they employ a lot of people. you know? why not let them give them a pass and let them try some of their experimental stores in some of our neighborhoods? you know, that i am all for, and if it is a local company, you know, another one, or another good example, i was thinking during this whole formula retail debate back in

2007, one company that comes to mind is san francisco soup company which started here. and now they are not even opening up stores in san francisco now because they are past eleven and now they are opening up in other places which i would love one of those in my neighborhood. that is not to mean that i am proformula retail though. and i do believe that there needs to be some balance because sometimes formula retail would be good for certain neighborhoods as anchor stores. i do believe in the cu process, and i don't believe in out right bands, i think that they are bad. because once there is a band it never gets fixed. but the cu process, i have seen things shut down, and the neighborhoods did not want them and that will, and it is in the cu process and i have been

through that myself. and you know, it forces these people to get more involved in the neighborhoods, whether it is in the merchant corridors or whether it is in the neighborhoods at large and there is a lot of benefits to that as well. and, i am a firm believer in that cu process. but, i am not a big fan of the out right bans and and if you are going to be making a policy decision, i would like to see something that will favor, you know, corporate san francisco and i know that is not going to be popular to say, but you know, somebody like levi they do have experimental stores and somebody like the gap, and they do have instrumental stores, and i think that, you know, it would be cool if they started those stores like right here in san francisco. and so, it is just my two cents about that. but, i am a firm believer in the current cu process.

a little mixed on the international ones. and i am not a big fan of the big boxes i will agree with mr. cornel and his comments, and i remember when the orchard supply came in i want to know where they came up because i looked at this and discount builders hardware was next door and it was not counted and i thought that was kind of odd. so that is my two cents and commissioner o'brien? >> yeah, it is a very complicated affair, i sat a couple of other commissioners here. for four or five hours, listening to the pet food express application, and i personally, agreed with the recommendation of the planning department but i was very struck by the fact that it was truly turned down by almost a majority or a unanimous vote,

not quite. but it was a powerful vote six to one against the application and it was interesting for a lot of different reasons, because there is a lot of unfortunate nature calling and malining good people, and the pet food express has definitely run by people who are neighborhood oriented, and they are good people. and that the programs that they run, which they, you know, evangalized in a big way as part of the application, they were sincere and they don't do animal care and extracurricular activities for the pure hard business sense they do it because they do it because in their heart it is the right thing to do. but i think that it is going to be complicated to how you deal with the local neighborhood as well. it is going to be hard to try

and to program it that it is not a contentious issue and there is predictbility but it is going to be hard to weigh in how you react to the neighborhoods, what they want to do and what they want to have in their community. i would also like to agree with commissioner dooley's comment that the size of the entity that wants to command is definitely something that should be brought into account. i think that the big store or a big powerful corporate entity, bringing in a big box store, should be treated a little bit differently than, somebody who wants to open up a small little coffee is shop that might have some recognition because they have more than a couple of branches somewhere, i think that is the point that she was making which i think is a good one. i also think that on the big box ones, that do effect the

city wide, the economic impact should be weighed in and not just in terms of the potential to cause businesses to fail, which i am not convinced they do myself, personally, i have always, when i speak to the business community, i always tend to go to where the business is even if it is in the same business just for the traffic. but also, the dollars that they bring into the city general fund. i mean when lowes went into bay shore, they are bringing in a lot of money that was going to another big box store and now it is coming into the city coffers in san francisco and so i think that that should be a factor that is brought into account as you go forward with the analysis. i think that it is a real challenge, and i agree with the spirit behind formula retail controls and i agree with commissioner adams on not a blanket out right ban is probably, i never agree with a

blanket out right ban on anything, whether it is marijuana or whatever it is, i don't believe that it could be categorized as black and white and i will be in the middle with conditional use and formula retail is no different and those are just the thoughts that i have. >> commissioner dwight? >> i am very concerned about sort of stoeking this anti-big, sentiment, and i think that we do have to remember that big companies do good things on a scale that small businesses cannot. and we have a good number of very large companies in this city that supports the arts and they support the community health on a scale, that would never be possible, by a small businesses. wells fargo, and sales force.com, and just to name a few. and i also think that it is very important to remember that here we are talking about specifically about retail, but, big companies effect availability of the rental space downtown and so if you

are a company just looking for office space, and big, can be a challenge and so, you know, this is not just limited to our merchant corridors and you know, i think that having big companies downtown is a good thing and it stimulates a lot of activity in the city and creates jobs and generates wealth for the city itself and so this sort of anti-big sentiment, troubles me a little bit. i also think that big companies, can and do, bring in innovative retail concepts to the market and they don't just do it under subbrands in a way that sort of be subversive or to get around things and puma opened a fantastic store under the own store in the meat packing district, and they brought in a lot of energetic people and companies to an otherwise blighted area that today is one of the hottest retail areas in new york city.

and so, big companies can help activate, they can help energize and they can help to stabilize even small retail areas and i think that we should not forget about that. and i am especially concerned about this notion of banning because like you say once you ban it there is no going back, and every neighborhood in this city, has gone through transitions, and the neighborhoods that are hot today are cold before and the ones that are cold right now, and have been cold are heating up and sometimes it takes someone with the financial resources of a large company to come in and put a stake in the ground, it is not just the small businesses investing in these neighborhood district and sweating it out for ten or 20 or 30 years and generation and all of a sudden saying that we found out that it was cool and the big guys that came on long, sometimes the big guys make it cool. mid market, that area would not

be activated were it not for the big companies with a lot of money without the twitter and the other companies come in that place would not happen and it is now an opportunity and you look at the hukle berry bike shop, they are in a symbiotic relationship and it is the whale with the sucker fish on it, it happens in nature and in business, and it took the whale to provide the he co-system for the little guys and to say that you made it cool and so we are not going to let the big people come in and just a little hypocritical at this point and so we have to acknowledge as a city, 49 square miles or not, it is a relatively big place with big needs, and i don't think that it was trading an environment that is hostile to the companies because they are big or international or have more than 11 stores. i think that most small retailers would dream about the

day that they would have ten, 15, 20 outlets. >> that would be awesome. >> and everybody dreams of that success. and who are we to be stifling, the dreams of success for small businesses? it is a really sort of strange, unamerican concept to me. so, hopefully, the policies will be such that they are flexible, and allow the, you know, whatever level for everyone to have in the public dialogue and to acknowledge that timing, location, all of those things, factor into what at any given time is a good decision or what happens, a controversial decision for a neighborhood. >> commissioner dooley? >> well, listening to commissioner dwight and i feel like we go back to the same thing which is i don't think that it is impossible to say one size fits all in terms of policy. and i think that you know, we have had that kind of concept in formula retail in the

planning code and i think that this is the time to have the opportunity, to refine it. and you know, in terms of the international companies i do feel kind of comes under the same thing of the buying power, the rental power and i know that that is something that in the ncds is a concern. if someone says to the landlord, i can pay it, 100,000 dollars a month, you know? and then, it does crowd out smaller, start ups or whatever. but i am not saying, that that is going to be the case, everywhere in this city. i think that clearly downtown, for example, you know, and it should, it is an area for a national brands and for prestige companies but i do think that when we look at a company, they should be considered formula retail.

we are not saying that they are banned. they just have to have the cu and i think that that is a good process. i would have to say, coming from north beach, which has a total ban, on formula retail, we have been successful with that. we don't have vacantcies for more than a week and you know, but i am saying that that is just that neighborhood and it does not always have to be that we are heavily visited we have a represent reputation and the haze valley folks feel like they are in the guides now because everything is san francisco or and so i do think that there is that side of the issue, the same thing with say athleta. they may be a one off store but they are not like a brand new person they are someone who has

a major corporate person behind them, and i don't think that they have to be banned but i think that they need to be acknowledged as being formula retail. >> thank you. >> commissioner? >> director? >> i guess, commissioners i just have a couple of questions for you. so, a couple of things, that i know that i have heard from the commissioner in the past, is the formula retail that is evolving. and so let's say, like with walgreens, it is adding food, and so just question is there anything that would you like to see anything in this economic analysis and any kind of trending? and trending in terms of you know, formula retail involving or different, you know, any sort of trending? things to be able to provide you with some information, direction, and if they are trending or if they are trending in concern things which is like adding food or

alcohol, things of that sort, and also, i think that some of the issues of why we are seeing a lot of the formula retail neighborhood by neighborhood, is that it is coming from the local merchants over the concerns around rents. and so in this economic study, do you want to see like, is there any justification to that, so has there been, or what have the rents been like in areas where there has been, you know, formula retail there. so i am just asking, is there any information like that, that you would like to have this report address to provide you some feedback? >> commissioner o'brien? >> i want to take up your first point. i totally agree, i think that is a great point and i think that you should take a look at how many different types of product and stuff is going inside. and we have had this discussion before a little bit around, i think liquor stores and i think that you go to walgreens or

some of these stores now and they are getting into the business selling everything under the sun and, maybe that is the way that it has got to be i don't know, but i think that it is certainly worthy of being a part of the investigation. and something about let's analyze how many stores are trending in a direction of selling more and more products, is there a level of detail that we should go into on formula retail controls that will take into account, you know, some sort of a measure of how many different types of products are going to sell? and i have no problem with it being a little bit lower than being able to just go in and sell the pieces of plastic and sell milk and drugs, and papers and newspapers? i would love to see just it a little but that would be my preference but i think that is a good point and i wanted just to alert that as an important

consideration. >> commissioner dooley. >> i would like to follow up on that also, because i have attended the commission meetings that were hearings about a walgreens or another type of that type of a store that carries a lot of things, and some of the commissioners there have brought up the loading, and you know, whether, when walgreens just had a limited amount of stuff compared to now where they have everything in the world. and i think that we, you know, we like to have that looked into in terms of what they are going to need, and what their impact might be in terms of, are they going to need big semis, pulling up all of the time? because they have such a huge amount of stuff and that i think that, is an area that we is a little confusing and it is part of a concept, it used to be that a drugstore had limited

things and maybe you could buy the toilet paper there, but now that they carry a larger amount of stuff, i think that the terms of those kinds of impacts and what kind of space do they need. and if that is going to be a impact. >> from the grocery stores. >> exactly. >> and you know, even in our town, that is scarce, real estate, the grocery stores have, you know, a larger area to unload and load and i think that we are not going to need to start looking at these, i guess, you call them drug stores, but you know, they carry so many things and i think that we need to start looking at them a little bit differently in terms of what, what is going to be required for them to you know, do what they need. commissioner dwight? >> maybe just a couple of other variations to put on your radar

screen not to discuss here, but you might want to consider pop up retail which is done by sometimes by large corporations just to test the concept in the market. and then the other is to consider shop-in-shops a corporate entity coming in and taking over a portion of the existing establishment and could totally be done by having an agreement with a retailer and i want to have my own physical display and that can take on pretty significant dimension inside of the store. just saying, is should be on your radar screen because you have the opportunity now to look at all of the variation and there is a lot of novel retail concepts coming up and we saw it with the park or when they brought the bus to town, you know, and on-line retailer and glasses who say, hey we would like to have a physical presence and a pop up sort of format and they ran a foul of

mobile retail, and so we are just seeing these concepts and i would be disappointed if san francisco was a place that was hostile to retail since we like to think of ourselves as an innovation capitol and sort of stole that one from the valley and i think that in all things, sort of, innovation we should keep an open mind and open policy. i think that what we have proposed is under the economics of the heading we wanted to evaluate the other things like total employment and wage in formula verses non-formula retail and the employment data by income or race impact on public revenues for example,

sales tax, and property tax and payroll tax and spill over consumer spending and neighbors near formula retail verses non-formula retail and spill over efrks on residential rates and no control in the area where it requires the cu and the areas that are out right bans and in addition we are hoping to get san francisco specific data about the impact that the new formula retail may have on non-form law retail for example, we would like to look at information about non-formula retail businesss that may have closed or experienced reduced income following the opening or the opposite. >> we don't have numbers but we would like to be sure that we consider all of that information and as much as we can gather in a short time before changing policy.