basing on mixed-use decisions be addressed in a citywide retail standard? >> my personal opinion it should be left up to the neighborhoods. commissioner dwight? >> my personal opinion is that it leads to issues, like -- it's not just in retail. look at what happens with 8 washington and real estate development. when we start letting small groups of voters within a city that has very low voter turnout, basically hijack the process, and advance their own agendas because they take advantage of an imperfect system; then we get into trouble. and so this is where balance between letting the neighborhoods have their autonomy, but having the city establish some rules and regulations so that not everybody is at the whim of whatever that particular

make-up of the neighborhood happens to be. the other thing is that neighborhoods change. nobody, who is in the here and now wants to see their neighborhood change, but every neighborhood in san francisco is not like it is today, even ten years ago. some of them go back decades. and they won't be the same in decades ahead. and so who are we at any given point in time to say this is the final incarnation of this neighborhood and it should stay such? and so we're in a very -- this is a very prickly area here; where we want to give the neighborhoods their autonomy to preserve the look and neighborhood of the people who are presently there, but as we have seen with real estate prices and all kinds of changes, macro economic and macko and micro in our environment, neighborhoods can

change socioeconomically very quickly and then we have a bunch of controls that a previous group has encumbered the next generation. i don't know -- i'm obviously expressing my free-market tendencies here. [laughter ] >> you are exactly right, because the neighborhoods are changing and they will continue to change. >> and the , in fact,that new groups -- often advocate for change that ultimately is to the benefit of the neighborhood. you know, you look at a place like dog patch, used to be an industrial neighborhood and a lot of people move there had because it was untouched and nobody would bother us here and now you have a whole new generation of people that want changes that are family-oriented and changes that are non-industrial and they want changes that don't necessarily favor businesses that have been out there and thriving and now being pushed out. so i think it's just --

and this transformation is happening very quickly in certain neighborhoods. it's going to happen in five-10 years and not decades and generations. so a generation isn't necessarily years' generation, but a generation meaning the make-up and a generational make-up can change much quicker than just the temporal generation. >> commissioner dooley. >> i hear commissioner dwight, but i also would like to point out when neighborhood groups maybe do seem to be taking a lot of lead and things, i would urge, which i do everyday in my own neighborhood, to people to get involved, and to make changes that they are interested in. you know, an ncd, for example, is not written in stone. it can be changed. and i think that that sort of where the problem lies that we

have a lot more transient residents in many districts now. but i say, if you are in dog patch and you want something different, i say get involved with your group and go to your supervisor and make the change. it can be done. >> commissioner dwight's comments of neighborhoods changing, i'm in upper market with huge changes with all of this new building and more new buildings coming and the thing that worries me the most, that we do have a lot of ground-floor retail coming on the market. and with the neighborhood groups, sometimes people want something and we don't get it. 95% of the people wanted a traders joe and told no. 95% of the people wanted a chipoltes and we were told no.

so what worries me with certain controls being tested, there i'm just afraid of what you said to see a lot of vacancis and developers -- and sometimes a formula retail can subsidize that. my neighborhood is definitely changing with 3,000 new people moving in. and the characteristic is definitely changing and you are already seeing it; which worries me on a lot of different levels. progress is progress and you need to move forward. you don't want to sit there in the dark either. so we're not going to -- like commissioner dwight said we're not going to figure it all out today.

when is this? >> the planning department is making the policy recommendations to our commission on may 22nd and publishing our recommendations on the 15th. we would really welcome you to make a formal recommendation at the hearing or send it ahead of time to be included in our had you publication. >> commissioner ortiz. >> our purview is to look at things that benefit small business and just sometimes conditional use do spur the neighborhood. so i think having small business in mind and i think it's easy to say and it's a big and messy process, but as along as you are keep small business in mind, and ease to get a permit or get business done, that is how business is done.

bureaucracy is not needed. >> commissioner dwight. >> as the city becomes more expensive for small business, through fees and taxes and wages, and real estate; formula retail may eventually be the only way to bring certain moderately-priced goods and services to neighborhoods that need them. because the marginal independently-owned retailers that have previously been supplying those moderately-priced goods are priced out of the market and we're going to see that happen over the next 5-10 years and be left with nothing, but high-end and specialty retailers and specialty restaurants and specialty boutiques and don't allow for some companies with economies of scale where they can spread the cost of doing business in san francisco across multiple locations, we're going to find ourselves with a very strong looking

retail landscape with a lot of boarded-up building. >> right and that is the thing we should be worried about most right now. >> mr. president, i heard a mention of continuing the discussion of. i don't know if that was a formal continuation of the discussion. >> thank you very much for participating today. i may have you back. thank you. >> commissioners, one option is to sort of finish this, wrap up for christian to sort of coalesce and digest the comments and may 5, next week come back with something -- with a written and then you can do a formal adoption of what to move forward and present to the planning commission. >> can i request christian just briefly ran by some of the things that you had put in your report that i thought were really outstanding ideas about vacancies?

you know, encouraging and having the city have incentives to perhaps, when they build a new building, give them an incentive not to build one 20,000 square feet space and what other ways can we do? and also with the old whitel fantstores, we need to have incentives out there. we need to think about how to fill those spaces. >> sure. i think commissioner dooley is referencing no. 8. and so it touches in the beginning on the concept of the use sizes. so like the report said 85% of formula retailers 3,000 square feet or larger, et cetera >> there may be some more to that in terms of providing spaces better suited for independent retailers and potentially discouraging the

formula retailers. there should probably be a multi-step process. one being trying to establish those spaces as non-conforming, so they can't be further expanded. also providing for incentives or resources to get a professional architect that is familiar with reuse into the space, to reenvision, if it's possible to make into multiple spaces. the common from landlords it's economically imfeasible. so to establish a process where it's truly impossible to make the case to the building inspection commission or planning commission or any number of different bodis to get certified, in which case they may be able to continue with the non-conforming use. and for new development or redevelopment to establish an incentive, like miss burns says, it's not penciling out in the numbers in many cases,

three floors of residential and one level of commercial. maybe there is something to considering some sort of density bonus for first-floor retailers that allow small-use size and commit to not having formula retailer and allow them to do an extra floor or two of housing. i think it's something that is worth looking into. there is certainly a number of challenges and pros and cons to that approach, but it's one concept that i think is worth discussing. >> i want to open this up to public comment. do we have any members of the public here to comment on item no. 5? welcome. >> good afternoon, san francisco chamber of commerce. we have a task force working on this issue. broadly-based throughout a variety of businesses, and sizes and neighborhoods. the chamber is made up of 1500 members and some of them are small retailers and small restaurants that see competition from formula retail. at the same time, as was

brought up here this afternoon, our concern is that controls allow for appropriate regulation within the law. that san francisco not go down an anti-competitive path. no. 1 that is illegal. not well-defined necessarily to-date by state law, but it is there. there are cases around california and the country. because i think the issue, you bring up super dooper. we all like it and it's an expanding change, but you know who won't like it? some competitor hamburger store whether they have nine outlets or 12. it's not any of us or it's not most of the neighborhoods, the residents. it's time and time again, neighborhood character being used as an excuse to argue

against a particular competitor and that is something that we have to be careful about and with any new change by the board of supervisors sometimes, they are franchisees, to give them a fair chance through the cu process and not have two arms -- both arms tied behind their back before they even get an application filed. thank you. >> thank you. any other members of the public? seeing none, public comment is closed. so can we continue then to our may 5th meeting based on your recommendations that christian typed up based on our discussion today? >> and do you have any questions for the commission for clarification that you may need to be able to summarize? >> well, we only made it

through approximately halfway on most of the items, so i'm happy do what i can to summarize the positions that we discussed, but the first part of next week may need to be a continuation of these items, if that is beneficial? it's whatever the commission wants. >> thank you. this is going to be another interesting topic. next item, please. >> item 6 discussion on the potential for an increase to san francisco's minimum wage hourly rate. this is a discussion item. and included in the commissioner it's a binders you have the city economist's report and uc berkeley center for laborer research and education report and minimum wage act of 2014 ballot measures language. >> so commissioners, and if the public would like a copy,

happy to provide -- -- this is to have a general discussion. there is a ballot measure ahead of us. the mayor has also assembled a task force to take a look at minimum wage and so this is to provide the commission at least the beginning dialogue to provide some direction/feedback on minimum wage. as it stands in regard to the ballot measure and/or moving forward, i have asked commissioner dwight, who has been sitting on the task force to kind of guide us through some of the discussions, a summary of the discussions that have taken place at the task force? but just to kind of outline in the excel document, what i have is the current minimum wage as

it is -- what it was in 2003? what it went to in 2008? the percentage of increase at that particular time? and based upon the cpi adjustments, what it has been? what has been the running average, which has been 2.4% if you don't include the increase from 2003 to 2004. so the running average is 2.4% increase annually. so doing that 2.4% moving into 2015, if nothing was happening, then the minimum wage could increase to $10.94. now the state has passed legislation -- state has passed up to $9 an hour this

july and then january 1 2015, it's going to go up to $10 an hour. now senator leno has proposed a bill at the state to then in 2016 to raise the minimum wage to $12 an hour and then moving into 2017, to $13 an hour, with cpi adjustments. the seiu ballot proposal is proposing for businesses that are under 100 they will be to increase minimum wage to $13 an hour. and in 2015, $14- those over 100 employees would be $13 an hour in 2015. and $15 an hour in 2016. and when you take a look at that the percentage, it's

basically equivalent -- it's roughly around a 24% increase going from one what is now to a $13 increase. and taking it that that sort of models after the percentage increase that the city had going from 2013 to 2014. and just to give you some base information, also what we didn't have in 2014 was paid sick-leave and the health care security ordinance. so in much discussions with the economist and data that they are providing in terms of the impact does not take that into consideration. so just wanted to bring that to your attention. so with that, commissioner dwight, would you like to? >> sure. i will just give a little update and perspective on where we are. the mayor convened -- it's

well-known there is a national debate about minimum wage and whether and how much it should be raised? and so in response to that, and some discussion within the city to raise the minimum wage the mayor convened task force, minimum wage task force to try to come to some sort of consensus about where the city -- how the city might address increasing the minimum wage above the present legislation, which raises the minimum wage every year around cpi-based model. the first meeting was april 10th and was intended to give us an historical perspective of what happened in 2003, when we enacted legislation and started

us on our current trajectory of raising minimum wage and cpi-based raised every year since then. the study was done only on the restaurant sector, and the conclusion has been that effectively there was little to no effect on local employment based on the increase on minimum wage. it has been pointed out at the time, the restaurants being studis were already paying above the prevailing minimum wage, federal minimum wage at the time. and so there was not as much impact on businesses -- they didn't feel a wage shock at that time. and 2.4% increase, though it has kept us well above the national minimum wage and even minimum wages in the bay area region, it seems to have been manageable for the past decade. san francisco businesses have

not gone out of business -- small, local businesses do not appear to have gone out of business because of this exclusively. the second meeting was last week on april 24th. it was as opposed to the historical perspective in the first meeting, was designed to take a look forward and say what is going to happen this time? do we have any idea what is going to happen? can we use history as a guide? is the state of the economy different today? and are the conditions under which we're doing this today different? and i think ted egan who gave the previous presentation, the historical one was by an economist at berkeley and this presentation was by ted egan, city economist. the proposal, at least the one that is on the table from seiu

represents a very significant increase in the minimum wage and that increase is the most significant to our small, independently-owned businesses that have minimum wage employees, that the restaurant industry is particularly vulnerable that also our merchants are vulnerable. our non-profits are vulnerable and our pdr businesses are vulnerable. so we have keep stakeholders who have vulnerable to increase in the minimum wage on top of health care payments and on top of paid timoff and on top of all of the other taxes and fees that we pay in the city. so this just makes san francisco less affordable for the small, independently-owned, sort of

traditional many low-margin businesses. so i think now the task at-hand -- so the answer is that we don't know what is going to happen. we think something will happen and there will likely be collateral damage and what is the net effect of that on our economy? i think there is a general belief that our overall economy is going to continue to expand on the backs of the technology boom; that what we are talking about here is going to be a blip. and probable undetectable in terms of overall success in san francisco. with that being said, the minimum wage is intended to address a particularly vulnerable group of employees, and unfortunately the employers of those employers are largely the businesses that will be most affected by this change and could be driven out of business? so is this really helping the employees if we put

the very businesses that employee them out of business? so this is the conundrum we find ourselves in. but the clock is ticking, and the seiu has placed a ballot -- or proposed a ballot measure, they have not go out to get signatures. so there could be modifications or a withdrawal of that in preference of a consensus measure that could be put together through the process that the mayor has convened? or we might find or two more ballot measures on the ballot come november. i think then the question is if the seiu proposal stands alone and it gets enacted, that has a certain set of ramifications. if a second measure is proposed by the mayor, and through this consensus process and that is not acceptable to the seiu and they keep their ballot measure on and another one goes on from the mayor's process, that is

more moderate, because that is the intention. there is a gener -- al acknowledgment that a significant short-term jump in minimum wage will have significant negative effects on business in san francisco. i am glad that they acknowledged that because as a small business owners this t will have a significant impact on my business and other sectors. i talk to the restaurants and non-profits and merchant associations and how they are going to make it feelb -- not to make this in particular about my own business, but it's the area that i know. so we are trying to get to someplace that is generally acceptable; that is moderate on the front-end. that has a moderate ramp, but

has some forward-looking triggers in this. what if the economy turns south and if we mandate a minimum wage increase and our economy falters in a way that that no longer seems practical to anyone who is rational, but we already legislated it, what are we going to do? whether there are things to tie to cpi or the unemployment numbers? i mean we're presently talking about how great it is that unemployment has now been -- is now half of what it was at its peak; right? a couple years ago? and that is great news, but what if it heads back north, what do we do? without sets ourselves on a path of mutually assured destruction. so these are all issues being vet interested in this collaborative process. labor is at the table in the

mayor's profess process, as well as constituents, hearing from individuals who are in this class of labor that are struggling with the affordability issues in san francisco. the challenge is that the clock is tick and we are running out of time. all of this has to be wrapped up by june 15th when the mayor would submit his measure for board of supervisors approval and then anything that requires signatures has some time, but it all comes to a head of course in november. the challenge is that there is not a lot of time to have a good, thorough, rational conversation about this, because the issue has been forced both by a national agenda and by a local agenda. so that is really what i know at this point. no proposal has been put on the

table, no numbers have been presented in the minimum wage task force. so that is the next task at-hand and there is a sense of urgency around doing that. so that is where we are at today. >> i would first like to thank you for your leadership with this, commissioner dwight. it's very sobering what you have just told us here. >> it's sobering and exhausting. >> i do know, because when i am in the neighborhoods and out and about, talking to non-profits this is right now their no. 1 concern right now. and i mean, i have business owners telling me that already they are thinking about not even hiring right now for the summer, because they just don't know. >> yes. so this in my opinion, in my short history being here in the city, ten years now in business, this to me is the

most significant legislative issue that has ever faced business in san francisco -- small business. the challenge for this one, unlike gross receipts tax, where we had all of business at the table, we only have small business at the table here. no tech companies, no big-businesses are weighing in on this, because none of them employee anyone who is making minimum wage, so there is no point in any of them getting involved in the conversation. so small business is kind of the lone voice here and the non-profits. and it's very difficult to advocate -- it's this self-preservation versus wanting people to have a better lot in life and nobody in small business says that necessarily raising the minimum wage is a bad thing, but we also don't

want to put our businesses in jeopardy. because those are the very things that create those jobs. and if we are forced to go out of business, if we're forced to move, if we're forced to curtail hiring and if we are forced to down-size and if we are forced to eliminate a lot of optional benefits that people don't consider that happen at the small-business level, where they operate more like familis and benefits that are extend to employees that are not part of sort of the general conversation, but have real value. whether it's paid time-off. whether it be help when help is needed when there is someone sick or someone needs a break? so we could force ourselves into a situation where all of those kinds of discretionary benefits just can't even be offered because they are not economically possible. it could eliminate profit-sharing