area. their restaurant has quickly become a neighborhood favorite. this is something that is particularly challenging in this area. so restaurants that are working really hard to provide a really great cuisine. we need to make sure we are out there and visiting and eating and enjoying what they have to offer. this is also really great to honor bistro this month because it's filipino month. thank you for your great food and your holding it down in a quiet little part of the mission street. the excelsior district. >> thank you supervisor john avalos for recognizing our restaurant. we appreciate it very much. and you are all

welcome to visit us and checkout our food. we are open dinners tuesday through sundays. address 4994 mission street, right at the intersection of italy and mission. [ applause ] >> supervisor, that is our final presentation for today. i think we are all abundantly

hungry and we have a lot of places to go in the city. i want to thank you for all in the amazing restaurant world and making this city an amazing place to live. i would like to go back to our special order. i do not see our city staff. i hope you can hold the fork for everybody. we have a number of people on the roster. i have a couple of brief questions. i think many of us know that this appellant is about as sympathetic as possible and i think we all have questions on how we want to address this. just so i'm clear, maybe this is a question to mr. lee or to mr. gibner, under the law that was passed earlier this year, there is not

a ground under the appeal to adjust the fee unless we find there is not a relationship and nexus of the impact of the development. >> deputy city attorney john gibner. that is correct. there is only one ground for reducing or our adjusting the waiver fee that there is no relation between the nexus impact. >> and as well as the appellant ability due economic or disability. >> that is correct. >> that we might carefully constructed upon which is on this base. >> that's right. the fee is based on a determination of the nexus and the nexus study

provides the largest fee that the board could have imposed for conversions. but it was in the board's legislative discretion to impose lesser fees or create exceptions legislatively for people who meet certain income requirements. >> thank you, one follow up question, i was informed by my staff that there was one or two ellis act evictions at this site. could you let us know if that's the case. i can ask any of the city staffers. >> we don't have the research on it. that issue is going to be part of the review of the application is my understanding. that would be done by the dpw. >> it's my understanding under records from the assess or's office about the ellis act

evictions in 2004 and 2005 if there were that would not an allow the conversion and the fee would not be charged. can you give us a sense of what that impact might be if that turned out to be the case. >> deputy city attorney john gibner. i think this question is for dpw. >> why don't we defer that. i have a number of people on the roster that would like to address this. >> thank you, we got the information and personally went to the assessor's office and learned there was an eviction in 2004 and in the ellis quarter was documented in 2005.

it seemed to be the case where this was a senior disabled. i think it's important to get this information. this is my larger question in terms of planning in terms of how we vet condominium conversions application. there may be that this is the building that is trying to go through, but i want to make sure we have a process in place to ensure we are following ordinances to follow in place. my question was to the mayor's office of housing. i appreciate the incredible difficulty of this particular case and certainly when i first learned about it, i had a lot of mixed feelings about what the next step would be. i completely understand that the only bases by which to appeal your fee is to challenge our nexus study which allowed us to put a fee in order to buy pass the condominium conversion

lottery. challenging that analysis challenge , of course has a -- and i have a separate -- i know that hardship discussion did come up during the tic conversion discussion and actually it was supervisor yee who had suggested offering and option of a fee deferral until the moment that there is a financial benefit that is actually given to that unit owner. so not paying at the moment that you apply but applying for a fee deferral for the moment that you have that financial benefit incurred upon you for that reduction of payment that you are able to go through your individual mortgage process which is

actually one of the owners of this building actually implied with a reason as to why they were applying for this. so i had a couple of questions on the memo that you served to the board of supervisors. one of my questions of course is on the actual value of the financial benefit conferred upon conversion to condominium. i apologize we took a break and i have to go back to it. but, in your memo, the mayor's office of housing suggested that there has been an immediate benefit. it's hard for me to scroll through. i had this prior to the restaurant appreciation month. it was based on the value that was estimated. i want you to let us know how it was estimated and

what it was based off of. >> i'm with the mayor's office of housing. per the memo we came up with a clear benefit for all tic owners and benefits because we don't know how much they put in terms of the down payment and what her monthly mortgage payments are. it's hard to say with a lot of specificity. we pointed mostly to the nexus study. predominantly it's the benefit around increased equity in your home through a superior form of ownership. as a condominium owner and a joint owner as a tic and the banks recognize that. they recognize that by charging you oh lower interest rate and giving you the ability to refinance. it came up earlier whether or not the

appellant would be able to refinance. i think i recall from the original documentation that the mother was the cosigner in the original loan and it's likely that it maybe a similar situation she would be in after condominium conversion, but the banks do provide more beneficial terms. so under a tic loan when i looked at it earlier this week, it's about a 4.75 interest rate versus a condominium loan which would be a 2.25 interest rate for her home loan. you would be able to refinance, a better home value, resale value and more discretionary income to support your fixed income to do other kinds of home equity improvements in your home whether you wanted to do other

sort of improvements to improve the condition of your life. >> i'm actually on the memo now. on page four it satisfies after deducting standard city administrative fees. what is this based off of? is it decrease in potential mortgage payments due to interest decreases? >> right. it's the value of going from a joint tic ownership model to an individual condominium owner. it's a superior form of ownership as you increase the benefit. that was part of the

2001 nexus study. >> even without selling your unit there is a financial benefit with your mortgage benefit at the moment the subdivision map is conferred. can you explain about the fee deferral profit at which point you are granted the financial benefit. what would the process of applying for the deferral be? i know that you can use that to pay towards your condominium conversion bypass fee? >> john from the city attorneys office. maybe i can address some of the questions, because this is a 3-unit condominium subdivision, it's not one of the maps. the final map approval is granted administratively by the count is is you surveyor. it's when

the fee is made when they qualified for deferral. once that map is approved, then it can be reported at the county recorders office and that officially makes it a condominium in legal terms. there is then sort of transactional things. this is lined up in advance with a title company and a mortgage company. it's really up to the property owners. oftentimes, there is a transition very quickly when you become an official condominium after it's recorded to change the mortgage product that you have from a sort of a joint mortgage with all the tic owners to individual mortgages that each condominium owner has. it's up to the property owners to go

figure out that process and to line it up and see how quickly they can do it. but, within a short period of time you will be in a situation where you can arguably have a new individual mortgage at a lower rate on a higher value piece of property. >> thank you. my next question is, is there, i know there are situations where maybe not all owners agree to condominium conversion maybe because they don't want to pay the fee but there are other owners who have other greater incentives to sell. is there anything that mandates that the owner itself must pay the $8,000 fee or is this a payment per unit but can be divided differently among unit owners?

>> supervisor, that's correct. the fee is calculated on a per unit basis but applicable to the building. there is no -- requirement for the owners to pay the fee. the owners can decide amongst themselves how to pay the fee. they can even structure it as a loan to maybe one owner who couldn't afford the fee at the time or until a far future date by making it part of the deny knxv -- making it part of the home owners from the loan of the hoa to the individual when that individual sold their unit. there are a lot of options potentially among owners that the legislation doesn't speak to. >> thank you, in your memo you related that you have done a quick survey of the property. what do you estimate it's

current value -- at? >> we did have a quick turned to do the analysis. i later checked the assessor's records and the value was estimated over $1.9 million. i don't have a number for what a per unit value would be once it's converted into condominium, but maybe dpw has more information on that. >> thank you. i think the larger requests -- question for me is what sort of services or counseling do we provide for middle income or low income home owners like this and i'm really sympathetic to this

homeowner as to a fee waiver and to examine what resources the city has in terms of home ownership that may have enough means to get there may be through the help of family and friends and quite challenging to sustain that home ownership. i know that several of us would like to learn more and perhaps that will be a later discussion. my question, i would like to go back to dpw. so president chiu brought this up, this is also brought up to our office as well which is on the history of the property itself. and we actually did go to the assessor recorders office there is an ellis act eviction on file in 2005. i don't want to go into detail for what that means, but i have questions about the overall process. what was the process that dpw in planning thatten

insures that units applying for this are available? >> city and county is survey or. we have a standard referral letter that ask if there has been evictions and if there have if they can give us the details. the rent board says they have there have been evictions they can give us that information. >> you are aware of that history? >> yes. >> great. i think some of us want to know there was a process in place to ensure the bypass that we wanted to go through are an allowable under our ordinances. >> we get all eviction

information after 2000 from the rent board. >> after 2000. okay. thank you very much. >> if i can just follow up on that. the question i asked about supervisor kim was the impact if we have records from the assessor's office from the 2004-2005 process, can you a pine us as to the eligibility of this? >> it was after that. it it was date after the ellis act. this was in november of 2004. it was before the date that that legislation affected it. >> okay. >> and then one other follow up to also supervisor kim's question and to mayor's office in housing. are there programs

that could assist rather than granting a fee deferral in this circumstance for you to help this particular appellant with the $8,000 circumstance that she has either with a loan or some sort of dispensation with your office with the prop c funds that you have and programs that could assist her here rather than what i think that many are concerned about that undermining this legislation? >> mr. supervisor, the mayor's office of housing currently doesn't have a program that provides this assistance. in terms of our single family programs we have provided loans for initial first time home buyers. we have provided rehab

loans for low income residents. we don't have a current program to provide the payment of fees due to the city at this point. this is a voluntary fee. there is a benefit being conferred to the appellant and we don't have a program for this at this time. >> thank you very much. >> supervisor avalos? >> thank you, mr. president. earlier you said that the present value of the property as you assessed it is estimated to be $1.9 million? >> that was based on the assessor's record for the 3-unit building. >> do you know how much the building was bought for when it was bought? >> i don't have that information readily available,

supervisor? >> okay. but presumably, all things being equal, if you condominium convert, that it would be easier to refinance a property once it's condominium converted prior to that, right? so presumably by an allowing them to condominium convert that it was before it was converted? >> if you are not going to sell the condominium, one of the financial benefits of this process is to refinance for the period of ownership that banks look at as less risky and at some point in time you resell your unit on your own without

consultation with your home owners for a clear value. >> in terms of the amount of fee that we are talking about in a $2 million property, what is the amount that folks are asked to pay. too amount of the fee is $24,000. there are other fees required by the city in terms of the condominium conversion in terms of the application fee. you may have to hire, there is a survey fee and you may have to get your property up to code in order to complete the process. >> i see. but the condominium conversion fee is $24,000 for the 1.9 million? okay. thank you. >> a few questions for mr. lee. actually a follow up on some comments that you made. first, you had noted and i think your

intention was probably to show that there are some financial options for this applicant. you noted she had the option of a fee deferral and received a 60 percent reduction in the condominium bypass fee. in terms of the fee, i think it's important that is not in my mind any kind of a significant benefit. maybe it gives you a 9 months delay, for some people it can be significant in terms of putting money together. but i think this is important to acknowledge that this is not helpful. this is probably a brief delay. the 60 percent reduction, may sound like wow, she got a 60 percent reduction. that's because under the ordinance this building has been in the lottery for a

number of years and the reduction happens. am i right about that? >> you are correct. actually all the things that you mentioned in terms of how the fee was set and the question about the deferral, those are all from the ordinance. they are not administrative rules from the mayor's office of housing. they are all from the ordinance. >> right. there was a reason for it because it had been in the lottery for some time and would have prevailed had this legislation not gone into effect. you also referred to as a voluntary fee. i think it's important to put that into context. the legislation supervisor federal -- ferrel and i introduced, you can go to

the bypass and stay in the lottery. and they offered the option for those who can not afford the fee to stay in the lottery and pay the fee. but your option of not participating in the bypass is getting put in a 10-year moratorium and go back in the lottery under different rules that existed at the time you purchased the tic. did i state that correctly? >> supervisor, you did characterize it correctly. and again, the appellant that is option both for this year and next year to reap the expedited process. that's what's in the current ordinance. >> and the option if you don't

do it, if you don't spin the bypass you get put in the 10-year moratorium? thank you. >> supervisor yee? >> it's been mentioned by several supervisors that there is a possibility that the mayor's office could be helpful in these types of situations in regards to making available some funding that can help with the fees. and there is a response that as of now, we don't have such a program, is that correct? >> supervisor, that's correct. >> so, the question i have then is if the mayor's office were to go in that direction, to

want to implement such a program, how long would it take to do that? >> supervisor, it's true that our programs aren't constructed particularly for this case. it's a very specialized case around what is a voluntary albeit maybe necessary action for the tic owner to convert. most of our funding is targeted for first time home buyers or first home buyers at risk of losing their homes. that's why the mayor's office of housing has applied our current funding. i don't think we have a program at this time and we want to have additional conversations with board members to talk about what programs would like like and other tradeoffs would involve

to supplement or subsidize tic owners fees and with programs that we support through this office. >> i appreciate your answer that you don't have the program, but just because i'm relatively new to this process and i'm trying to get a better understanding that if you are talking to supervisors and if the mayor's office would be willing to do this, would it take 10 years, 5 years, 2 years, 1 year? what is it? i just don't know. >> i would say, we are outside the bounds of the budget process. normally a new program creation would happen through budget process if we had existing resources that we could redirect from other programs and that was the direction of the board i think we can implement prior to the next year's budget. it's really for the board to determine how quickly they would want us to

implement. our experience so far with prop c it's taken us 6-9 months to roll out the new programming. >> thank you for your answer. if it were going with the speed that's 6-9 months if and there is a lot of if's here, if this program were to support people like the appellant, then it wouldn't be too late for this particular individual to wait for that time because did you say that they have another year in this program to do the conversion? this year and next year? >> john from the city attorneys office. i don't know the ex