composed of representatives at city departments as well as members of the community, but not only through our office, it includes the mayor's office of public policy and finance, oewd, hsa, dpr, dcyf real estate division, planning department, controller's office, and about 11 or 12 community based organizations. we've had two formal meetings so far, one in december and the second one in january. we plan to have two more meetings. one in february and one more in march. our hope is to deliver the final report beginning in april to comply with requirements put forth in the working group sponsored by supervisors mar, kim, and cohen. you'll see in the budget analyst report that we did not give a full recommendation as to how the 2.515 will be allocated so far. in speaking with the budget office and members of other

city departments, we feel like -- we feel as if we would like to wail until the final report has been finally vetted before we determine what portions of funds could go to what solutions as acquisition and rehab, subdifficulties. we talked about many different solutions. as you'll see in the report, these looked at public private partnerships in conversations with private philanthropy i. we're in conversations with the tech industry. we're in conversations with the real estate to look at vacant or surplus city property. we're looking at vacant store fronts in commercial corridors, store front that might be available in the housing developments. we're also looking at, as i mentioned, the possibility of perhaps short-term rental subsidies. we're in the process of analyzing the data that we are receiving from all the

different city nonprofits. it looks as if when we did our survey in conjunction with the controller's office, over the past three years, the approximately at least $25,000 from us on a regular basis. so, we hope to come up with some innovative solutions. it's a very challenging problem. we've also been looking at some solutions that may involve issues that may come before this board. you will note that in the bla report they talked about the potctionv of examining impact fees, other commercial incentives, even the possibility of creating some sort of inclusionary zoning requirement. ~ possibility we're discussing with the planning department and the [speaker not understood]. we imagine they'll be short-term solutions and long-term solutions. what we support is the recommendation that they have given in the budget analyst

report which is to hold this money in reserve until the beginning of april. at that time we'll be prepared to come to you with a final report and at that time we feel that it makes the most sense for the board hopefully if you're in alignment with the report to release the fund and at that point we'll be able to give you a much better picture of how we'd like this funding to be apply to our partners. >> thank you. president chiu. >> i want to thank mr. zew for the work you put in with the working group. i look forward as that process comes to a close figuring out the allocation of fund here. clearly there is a need and we've got to figure out both where the revenues are going to help us meet this need as well as where the monies can be best used. thank you, thank you. >> supervisor mar. >> thank you, mr. zew, especially for the work that pulled that working group together. i did have a question from harvey rose and the budget

analyst report. in 2000 there was 1.5 million supplemental from the general fund reserve for art organizations and a $3 million allocation for nonprofits with 500,000 for rent subsidies. and i'm just wondering why there's no mention about the arts organizations, california lawyers for the arts, 500 million, and $500,000 of the 3 million for the rent subsidies. why is there no information on that? >> well, in terms of the $500,000 to the rental subsidy n 5,000, before i joined the department. but in terms of examining the use of that fund, as far as i can determine, our department decided to not go forward with the $500,000 for the rental subsidy program. first, i don't know the reason for that, if it was determined that it wasn't going to be as

useful as the acquisition and rehab dollars, but it doesn't appeal if that particular program -- that was for all nonprofits. hob honest, the 2.5 for rehabing the section was fully expended. the art commission, as far as i can determine, that was before the current commission was in place. it looks as if perhaps up to $500,000 was allocated in one-time grants ranging from about 7 or $8,000 up to the maximum of $80,000. it appears to have been under utilized. again, i'm not sure of the reasoning behind it, but it doesn't look as if that program came close to expending the full amount of those dollars. >> i just hope as the working group comes up with its recommendations we have full accountability for money and that every penny is spent because the community based

nonprofits really need ti know supervisor avalos is already thinking of how we support not just generally arts or nonprofits, but also maybe specifically for arts organizations, especially from communities. i also just wanted to say, too, that as the nonprofit organizations in the city, the 1,425 contracts, has the number of nonprofits gone down since that crisis after the dot-com organizations merging and even others folding during the economic crisis time, do we have many fewer nonprofits now than we did? >> 13 years ago. >> we did, and we examined that list of 1,425. if you look at it over a three-year period, we did a filter and eliminated those that were only funded for like

one of those three years. and many of those groups were one-time funds of as little as maybe $100 or $300. many of them were trade associations. so, the number of partners that received $25,000 or more for ongoing social services has actually remained fairly constant over the last three years. so, i would say while there has been a decrease in the overall number of nonprofits, which i think has been rather significant, i think the number of providers that we rely on has decreased in the slightly smaller percentage. so, yes, there's been a decrease, but not quite as significant a decrease in terms of we rely on significantly. and >> and i'll wait for the working group recommendations. seem that rent subsidies is or capital improvement fund are important, but also multi-year grants just coming out of a nonprofit sector for stability over time as opposed to more yearly grants.

i'm wondering if those kinds of recommendations are coming out of the working gluev so far with your first meeting or two. >> you know, we haven't -- nobody has brought up multi-year grants specifically in relationship to this. i know it has been something that has come up in the broader cbo task force that has been convened by the mayor's budget office. but it's a good suggestion and we can look at those kinds of ancillary solutions that can help support this report. >> thank you. >> supervisor avalos. >> thank you, chair farrell. i actually appreciate the work that's been done behind this ordinance, the supplemental appropriation. and i know that we also had a hearing last year that kind of led to the thinking around how we need to be able to support a lot of the providers of service, nonprofit providers in san francisco. and the nonprofit displacement work group has been coming together and doing some planning. and i was also thinking that,

you know, there's a great deal of changes that are happening in san francisco to our specifically the arts community. although over the many years there's a lot of art space that has been lost, and i think that it will will be really important to look at how we can increase space for the artists and one way we can do that is perhaps to lease a space or even buy a space to allow for [speaker not understood] to have a space to rent at low cost to be able to stay here in san francisco and do their work, possibly musical groups as well. i know over the years we have lost a great deal of space. so, i'm actually interested in seeing how we can expand the scope of the nonprofit work group. how we can do more work with the [speaker not understood]. the recommendations already

within the profit sector we want to be able to support through the supplemental appropriation, but i think it would be good to actually look at expanding what we could do for the arts and allow there to be different, you know, [speaker not understood] scope of that modality in terms of creating cultural space in san francisco. i'd like to see if he we could actually increase the amount of the supplemental appropriation from $2.5 million possibly to continue or to raise it to another $2 million in the general fund reserve. of course, that would lead to -- we were to approve that at the board, or committee, it would lead to a continuance. i would like to think we could actually not just have a continuance from one week this week to next week, but a couple weeks. i can go and work with a couple artwork groups and what some of

the needs are and have a two-prong approach, one that could be focused on services, also health and human services and one focus on arts, two areas of local economy and service sector that are really having a difficult time remaining in san francisco. and i think that two-prong approach could have a significant impact on overall livability in the city. so, i think an appropriation could really help with ~. so, i want to hear public comment and all of that, but i'm actually considering proposing we increase the amount of funding and expand the scope of work that we want to be inclusive, specifically to arts and cultural community that is really struggling to remain in san francisco. >> i can't speak to the increase. that's up to the [speaker not understood], colleagues.

we are interested in continuing to support the arts organizations. we have tried to actively not gauge the art commission. tom is heavily involved in this. we're using some of the innovative work that they've done, for example, with the cast model as you heard. they created an entity that would actually help acquire a building which is luggage stored in other organizations, an excellent model, arts organizations that have strong programming but may not have the real estate expertise to actually go through that acquisition process, [speaker not understood] the arts. when we did send out the survey, we actually included the grant use for the arts commission and the grantees for grants for the arts so we were not only talking to the traditional social service agencies and [speaker not understood], we looked at nontraditional performance spaces because they need a different type of location and modality than a social service organization. so, i appreciate your comments.

>> so, i do realize that we have, you know, supervisor chiu, president chiu, supervisor kim who authored the appropriation or have asked that they be amenable to that. the indication is yes, i am supportive of the underlying appropriation certainly and i do see the vast need for it. i appreciate the little bit of time that authors of this appropriation want to give and i will make good use of it. >> if i could just add a comment to that. of course, i'm happy to work with supervisor avalos and his staff to engage some of the nonprofit organizations. this supplemental came out of the work that happened in 2000 with the dot-com crash and the crash impacted that area, and we have this pot of money. the amount of it based on what we project the property tax revenues to be, but also we intended this to be for the

broader community of nonprofit organizations that include arts organizations. [speaker not understood] a champion of making sure we are really supporting our arts community that has been incredibly challenged in recent years. so happy to consider moving this forward two weeks or so if that is enough time for us to engage with the working group and the arts organizations. is there a meeting with the working group coming up? >> yes, i think it would be on the next meeting of the full group is on friday, the 21st. >> friday, the 21st. might be good for this meeting to be in budget committee right after that so we can have this conversation, but i'm happy to defer it to then. supervisor mar? >> really quickly, i'm supportive of supervisor avalos' motion to increase this amount $2 million, but looking forward to the discussion. and then i know the controller's office made the

estimate of $2,515,000 attacks revenue growth in the central market and tenderloin and that's where the estimate has come from. i would like to see that amount increased, but i also think it's responsible for us to point where that money would come from [speaker not understood]. >> okay. any other comments? mr. rose, could we go through the budget analyst report, please? >> mr. chairman, members of the committee, president chiu, on page 6 of our report, the report that the proposed 2,515,000 be supplemented from the city's general fund reserves. the corresponding to the [speaker not understood], current balance of 44.6 million. so, if the proposed 2.5 million supplemental is approved, the general fund reserve balance would be 42,0 98,143. on page 47, as discussed today,

there is an identified need to address the issue of escalating commercial rents impacting nonprofit organizations in san francisco. given the amount of funding needed for a nonprofit rent stabilization program has not been determined. whether this program, whether with call it a one-time appropriation, require ongoing appropriations is not known. the specific uses of the 2,515,000 has not been decided and finally the specified criteria for the spending has not been determined. so, for all of those reasons we consider approval of the proposed supplemental appropriation to be a policy decision for the board of supervisors. however, we do recommend that you amend the proposed ordinance to place all of the 2,515,000 general reserve, [speaker not understood], for the board of supervisors to enable that group to provide

more specific [speaker not understood] on how such funds would be allocated. we would be happy to respond to any questions. >> thank you, mr. rose. colleagues, any questions for mr. rose at this time? he okay, much appreciated. at this point we'll open up to public comment. is there anybody who wishes to comment on item number 4? if there's more than one, please line up against the side wall there and we'll take everyone up one at a time. everyone will have two minutes. thanks. good afternoon, bill hirsch with the [speaker not understood] floor panel. good afternoon to supervisors chiu and kim for your leadership on this issue. i want to speak in support of the proposal. i think it's a modest amount of money. i am feeling the pressure of rent increases immediately. our rent is about to double on march 1st. so, anything that you can do to get this money out there to the nonprofits sooner rather than later would be much appreciated. i'm feeling a little old today hearing all of these ten-year plans and realizing how many of them i've been around for.

i was around in 2000 and got one of those grants from then mocd. so, some of that $500,000 did get out on the street to help nonprofits with short-term rent subsidies. thank you for your consideration. we hope we can work with you to make this happen as soon as possible. >> thank you very much. next speaker, please. good afternoon, nancy [speaker not understood] from social services. first of all, thank you so much for the appropriation and the suggestion to make the work of the task force have teeth, have legs, and continue. it is a great task force. it is a good cross-section of everyone in the community. i think one of the most important comments i've heard is that this conversation is really about the heart of the city. what kind of a city do we want to have? do we support the nonprofit service providers? and as you've so wisely commented today, do we support the arts? both of these groups are vital to this community.

so, we fully support this proposal. we look forward to continuing working with the task force. we thank you for your attention to this. >> thank you. next speaker, please. thank you, debby lerman from the san francisco [speaker not understood]. we support this measure. i want to express our appreciation once again to supervisor kim and president chiu and to brian chu for your hard work on this toshibationv. if you look at the affordable space report it looks like it was written yesterday. it gives a good starting point for the solution. what we need is a portfolio for both short and long-term solutions. this supplemental focuses on the most immediate needs and we already have many organizations in dire straits. the bla report highlights the

2001 grant and puts out possible models for criteria for prioritization for what kind of an application process we would have. and [speaker not understood] going on reserve while the task force does its hard work and comes up with its recommendations for the best and most fair way to allocate these funds and what kind of an application process should exist. and we want to ensure that this limited pot of money is used in the best possible fashion. i do want to actually respond to supervisor mar's question about the loss of nonprofits in the city. the october report that the budget and legislative analyst did noted about 7500 san francisco an nonprofits two years if go and now there are 6,000. we lost 20% of our nonprofits. we don't want to go any further. ~ so, thank you in advance for both of your approval of this

supplemental and your efforts to increase it. >> thanks very much. anybody else want to publicly comment on this item? okay, seeing none, public comment is closed. [gavel] >> colleagues, any discussion on amendments and so forth. president chiu. >> i think my suggestion is if could continue this to the budget committee meeting february 21st if there is availability on that calendar. >> we can have a motion to continue this till the meeting on wednesday, february 26th. >> can we amend that, please? my amendment would be to increase the amount from the general fund reserve, the source of funding by $2 million. it will be $4,515,000. and we'll continue the item and then in the meantime i will come work with groups in the

nonprofitization group and proposal, [speaker not understood]. if it's something less than and find out we have a program we want to put together. i just believe it's really important to also look at in particular the arts sector. that is really hurting right now in this economy. it's a big part of what makes san francisco great as the art and cultural community groups. let's help it out and the intent behind the increase is. continue to the first meeting after the 21st. >> supervisor mar? >> can i just clarify intent? i know that smaller community based nonprofit arts organizations might be facing more of the injures than larger arts organization s, but i'm just wondering are you suggesting more of a general allocation to arts groups? because it might help if you

prioritize smaller community based arts groups through the arts [speaker not understood] as opposed to larger organizationses that might be stable. >> [speaker not understood] really smaller arts groups. >> i'm in support of that and second the motion. >> motion by supervisor avalos and second by supervisor mar. and we can -- mr. city attorney, are we clear on the motion? okay, all right, we can take that motion without objection. [gavel] >> and then, colleagues, i have a suggestion we continue this to the call of the chair with the intent we'll do this on the 26th if for some reason there is additional dialogue, we can have it at that time. motion to continue this item to the call of the chair. take that without opposition. okay, so moved. [gavel] >> madam clerk, can you please call item number 5? >> item number 5 is resolution retroactively authorizing the general manager of the recreation and park department to execute a five-year lease from february 1, 2014, through january 31, 2019, with one three-year option to extend, for an initial annual base rent of $662,400 with coit tower, llc, for the operation and management of coit tower, and

reaffirming the commitment of the board of supervisors to protect and preserve coit tower and its murals in accordance with proposition b, passed by voters on june 5, 2012. ~ court title: >> thank you very much. we have [speaker not understood] from rec and park. president chiu, do you want to talk first? >> thank you; i appreciate your recognition for this resolution. it is one of san francisco's most icon i can structures. i want to offer my great thanks to the many community leaders and constituents from my district who live near coit tower and have spent a ton of time and energy over the recent years to get to this day. i also want to take a moment to thank the park and rec department and the arts commission for their work with the community on this. the resolution that we had in front of us would improve a concession lisa for coit tower, completing a process that began five years ago. ~ lease it will better protect the stunning murals created during the great depression by the

works administration. the lease also represents a response to the voters of san francisco who approved a policy statement in june of 2012 in proposition b. the statement said that we should prioritize revenues generated at coit tower to preserve and maintain the tower and its murals. and i am very grateful to be able to work with the mayor and our very city departments to have already made a $1.7 million investment toward the current restoration project which i do believe fulfills the policy goal that was outlined in park b. [speaker not understood] at an amount equivalent to 1% of the fund generated. subject to our annual budget process, prop b also called for strictly limiting private events at coit tower and this is a lease that prohibits private events. so, with that, like to invite up mike kenos ~ mc kenzie from

rec and park and then look forward to hearing public comment on this item. >> good afternoon, supervisors. mike kenzie, park and rec. thank you for your introduction. the park has been working diligently with the community towards implementing a new lease at coit tower. we have sought their feedback and what should be included in the least and i think we're really happy to present to the board a lease that really ensures that for the first time the city is going to be treating coit tower as a museum that it is. so, with that i'll give you a little bit of background on this. in october of 2011 the department issued an rfp for the management and concession of the coit tower concessions. the rfp included years of input from various community groups including the pioneer park project and the tower dwarf hill dwellers. the coit tower concession

principals and goals. the vast majority of those principalses and goals were incorporated into the department's rfp particularly the concept that we should rather than a gift store reate a high quality bookstore featuring items related to coit tower, related murals in san francisco, [speaker not understood] in the main gallery and also implementing a mural protection plan for the concessioner. in response to that rfp the department received three proposals. ultimately the department -- the recreation and park commission selected terry graham, the operator of coit tower llc of the selected responding. mr. graham is a local entrepreneur and has started numerous family businesses here in the bay area including the ankle "owester bar and [speaker not understood] in northern sonoma. and his proposal included -- met the department's

requirements about operating a high-quality concession and also included interestingly to the department a proposal to operate a docent program that will help educate the public about the murals and also serve as stewards of those murals helping to protect them from damage. so, the proposed lease terms are a five-year lease with a potential three-year extension. the permitted use is operation of the elevated missions. and then also managing the gift store, a docent program, and the audio tour program. as president chiu mentioned, the lease does not provide for or allow for special events to be held at coit tower. it -- the annual minimum rent is $662,400 with annual cpi increases. the tenant or the lessee would pay the greater of that rent or

the aggregate of the following percentages of the respective revenue streams. those percentages are 90% of admissions receipts, 20% of bookstore gross receipts, 10% of audio tourseses and bin objecttion la rentals. and 10% of the docent led tours. the lessee will be making $75,000 in tenant improvements to the building ~ mainly improvements to the bookstore space to create, we think, a feel that is much more akin to a museum that you might find if you visited the academy rather than a gift store that was the previous atmosphere of that concession.

so, again, these are the activities that the lessee will conduct. here is a breakdown of the improvement, mainly painting the tower viewing area, installing a security system on-site to help us be aware of any -- protect against vandalism on-site, storing shelving and lighting in the bookstore, and painting the bookstore interior, and other smaller improvements to help clean up coit tower as the department finishes the $1.7 million renovation project that president chiu mentioned. under the terms of this lease, the department expects to receive significantly more money than we had under the previous lease. for the past five years the department has received an average of $7 48,000 per year from the coit