>> all right, good morning, everyone. welcome to the san francisco board of supervisors budget and finance committee meeting for monday, june 16th, 2014. my name is mark farrell. i will be chairing this committee. i am joined by supervisor john avalos and london breed and we'll be joined momentarily by supervisors scott wiener and eric mar. want to thank the members of sfgov-tv covering this meeting jim smith and jonathan gum wall as well as the clerk of the committee linda wong. madam clerk do we have any announcements? >> yes, mr. chair. [speaker not understood] dock youthtionv to be included as part of the file should be submitted to the clerk.

items acted upon today will appear on the june 24th board of supervisors unless otherwise stated. >> okay, thank you, madam clerk. so, colleagues, members of the public, today we start the core of our budget season where the mayor will propose the to allow for adequate time for [speaker not understood]. for members of the public that are interested, you can find out which city department is presenting by going to a budget hearing schedule on the board's budget website at www.bos.org back slash budget. [speaker not understood]. public comment [speaker not understood] will take place this friday, june 2g, starting at 10:00 a.m. right here in the board chambers and public comment this year also we've a added an additional layer by advising the board of supervisors website at www.bos.org/budget and

selecting the comment budget all those comments will be submitted for the record. this committee as always will not take any action to amend the mayor's proposed budget or to approve any part of the budget until we do receive public comment. with that being said, madam clerk, can you call items number 1 and 2? >> item number 1, minutes of the board of directors meeting of march 20, 2013. [speaker not understood]. item number 2, proposed annual salary ordinance enumerating positions in the annual budget and appropriation ordinance for the fiscal years ending june 30, 2015, and june 30, 2016, continuing, creating, or establishing these positions; enumerating and including therein all positions created by charter or state law for which compensations are paid from city and county funds and appropriated in the annual appropriation ordinance; authorizing appointments or continuation of appointments thereto; specifying and fixing the compensations and work schedules thereof; and authorizing appointments to temporary positions and fixing compensation therefore. >> okay, thank you very much. so, colleagues, we're going to start different departments. we have i believe 19 departments coming before us today. so we're going to kick it off. our city attorney is youv first, mr. herrera, thanks for

being here. colleagues also member of the public, i've asked each city department to take no longer than 5 minutes to present their initial budget presentation and then we'll hear from harvey rose, our budget and legislative analyst if he does have comments or he has prepared a report and we can have discussion on that. >> thank you, supervisor farrell. very much appreciate the opportunity to come speak with members of this committee this morning. you'll notice from our budget that i propose fy 2014-2015 budget has increased by 3,035,0 98 largely due to salary and fringe benefit increases. we have had an opportunity to review the budget analyst recommendations. i'll start by saying i have no substantive disagreements with the budget analyst but i would like to take a couple minutes to offer some highlights of the work the city attorney does on behalf of the san franciscans that it serves. now, i'm sure that you know our

mission is to provide first rate legal service to the board, the mayor, and also to the over 100 city departments, agencies and commissions that comprise our local government. and our work includes drafting and review legislation contracts, surety bonds and all other legal documents. to give you a sense of that work we opened approximately 200 board generated work assignments in the last fiscal year, small increase from the 186 board assignments in fiscal year 2013. of course my office also defends the city in civil lawsuits and claims whether those involve tort claims lawsuits or legal challenges to policy initiatives. to give some statistics on those responsibilities, we handled more than 2800 claims and just concluded 2013-2014 fiscal year. that was a slight drop from the 2900 claims we process in fiscal year 2012-2013. we also manage a nationally [speaker not understood] litigation program that

protects consumers, tenance and working families. the city attorney's office has pursued litigation matters to advance important public policy priorities since 1998. but in 2006 my office launched its affirmative litigation task force which has been tremendously successful in being an incubator of ideas about using the law to bring justice to countless consumer in california and throughout the nation. and that task force in conjunction with the clinic at yale law school works on identifying bad actors across industries that violate our state's unfair competition laws. note worthy affirmative litigation cases acted in 2013-2014 include some cases i know you have read about. the lead paint case which began in april 2000 and predates my tenure in office just this past january received a $1.15 billion judgment against three lead paint manufacturers in san

francisco. if this is affirmed on appeal, will be eligible for you will to $80 million to pay for abatement work in private residences city-wide. last august i filed suit against the accrediting commission for community and junior colleges here in california, the accjc to save city college of san francisco. i know that has received a great deal of attention lately. and i am very happy that our lawsuit in the name of the people of the state of california secured a preliminary injunction that prevented accrediters [speaker not understood]. we will continue to work alongside those policy initiatives to make sure that city college remains open and served the 85,000 students that attend the school. ~ serves in fiscal year 2012-2013 my

office copiloted an affirmative litigation service this board is happy to support. i can't thank you enough for your assistance in the initiative of that. during the 2012-2013 budget hearings i reported the cpu had $9 million in restricted recovery funds that can only be used for consumer protection cases. at that point $1.83 million was appropriated in fiscal 2012-2013 for cpu recoveries. this fiscal year we received an additional budget of 2.6 million bringing the total cpu budget to 4.5 million. and that funded an increase in staff in my office and also paid for staff from other departments. specifically ose, the police department and the health department. the same is included in the next two budget cycles. and our restricted fund balance is currently $10 million. since inception, the city attorney's office has received over $20 million in cpu dedicated recoveries. in addition to many ongoing investigations, note worthy consumer protection cases

ethical fiscal 20-year, 2013-2014 include our suit against monster energy in which we investigated and filed suit against monster energy for violating california law from marking highly cafe drinks to children under 6 years of age. we signed a common interest agreement with the new york attorney general's office investigating monster information. last year i filed a first of its kind lawsuit against the state of nevada over patient thumping practices by state mental health facility in las vegas. that case alleges that the state medical and mental health agencies improperly bust indigent and homeless individuals to san francisco from psychiatric state hospitals even though the majority of such individuals are not san francisco residents and have no family or friends here to support them. ~ bus we're seeking to recover nearly $1 million in expenses we incurred to provide services on

behalf of those individuals that were bused to san francisco. most recently in april, i filed two separate lawsuits against short-term rental stop laws for illegally converting residential apartments into commercial tourist lodging. in both cases defendants had previously evicted long-term residents from their apartments under the ellis act. two of the evicted tenants were disabled. the landlord then relent the rooms to variety of platform. protecting san francisco's housing stock is a major priority for my office as you know and these cases remain in their early stages. that gives you a brief overview of some of the more major and recent cases that we've utilized the funds that you generously provided to support our cpu efforts and we think that those are in the best interest of the residents of the city and county of san francisco, in addition to the variety of other legal services that we provide to support our city departments, agencies and

commissions and legal initiatives that we take on behalf of the residents of the city and county of san francisco. so, mr. chairman, i tried to just give a brief overview in the five minutes that you allotted me. i hope i stayed to that number, but more importantly, i'm happy to take any questions of any members of this committee have and look forward to the comments from the budget analyst who i did say we had no substantive disagreements with. thank you. >> thank you, mr. city attorney, and for all your hard works. colleagues? supervisor avalos. >> thank you. thank you, chair farrell. i just wanted to thank you for the work of your office. it has been very helpful for my district, but also in the work of the board of supervisors crafting legislation. you and your staff have done great work with my office and i just wanted to let you know publicly about that. >> thank you, supervisor. >> colleagues, any further comments at this point for our city attorney?

he okay, seeing none, much appreciated. we will move to our budget analyst report. mr. rose, if we could go there. >> yes, mr. chairman, members of the committee. on page 4 of our report we state that our recommended reduction to the proposed budget total $253,3 74 in fiscal year 14-15. that recommended reduction is 5,36 [speaker not understood] one-time savedses. ~ saving. [speaker not understood]. and these recommendations will result in 253,074 savings in the general fund 14-15. all recommended budget total [speaker not understood]. these reduction would still allow an increase of $617,[speaker not understood], 8/10th of a percent of the

15-16 budget. [speaker not understood]. they are shown on the detailed recommendations are shown on pages 5 and 6 of our report. i would be happy to respond to any questions. >> thank you, mr. rose. colleague, any questions for mr. rose on our city attorney budget and his recommendations? okay. much appreciated. thank you. >> thank you, supervisors. >> so, to members of the public and to our controller, i guess what we would ask always if we could continue to make a cumulative list of all the proposed cuts we are in agreement with and we will do those on an ongoing basis and we will have those as a sweeping amendment hopefully next week at the end of budget. so, with that we are done, mr. city attorney. >> thank you. >> i don't think there is any need to appear back next week. >> much appreciated. thank you for your help. >> all right. up next we have our civil service commission. so, ms. johnson is up here.

>> good morning, supervisors. jennifer johnson on behalf of civil service commission. i'm the executive director. i'd like to give you a little bit of an overview about the civil service commission. the purpose of the commission is to provide qualified persons for employment with the city and county of san francisco and essentially what the commission does is the arbiter and regulator and overseer of both the city's merit system. the commission's mission state is establish and maintain credible merit system for public service employment for the silt sends of san francisco. and the commission's goal is to consistently provide the best qualified candidates for public service in a timely and cost-effective manner. just as importantly, the

commission is -- it is the goal and policy to provide fair treatment and [speaker not understood] otherwise prohibited, [speaker not understood] favoritism. so, there are five members of the commission. each appointment is ax six year term with oversight by the board of supervisors. the [speaker not understood] do have to take a special oath committing -- committed to he opposing nepotism and political action in civil service appointments. we meet the first and third mondays of each month. the commission is a mighty but small staff of six. i'll just continue on. the commission's main charge under the charter are to establish and define the merit system itself and the work of the civil service commission, it is responsible for establishing policies, procedures and rules governing the merit system including classification actions, examinations, probationically period, leave of absence, discrimination complaints and the like. and in its oversight of the

merit system we do conduct inspection service requests. anybody can request inspection service in its investigation to [speaker not understood] merit violation. we receive about 120 of those a year and we do endeavor to complete those within 60 days. in addition, the commission hears appeals of my decision or the human resources director's decision or the transportation director's decisions. that includes matters and discrimination complaints, again, examination matters, classification. the commission is responsible for overseeing the request for personal services contract where requests to contract out work that could otherwise be performed by zvi employees. ~ city employees. [speaker not understood] elected officials and prevailing wages. and, of course, the commission is also responsible for the administration of the employee relations ordinance and that includes a coordination of unfair labor practice charges. so, our policy objectives and

priorities for next fiscal year include standing effort to increase access to utilization of service commission resource he, increasing greater transparencies and efficiencies in our communications, ensuring timely resolution of appeals so merit system matters are addressed fairly, consistently and fairly. [speaker not understood] personnel management issues while at the same time maintain the integrity of the civil service system. expanding efforts to ensure that this commission's rules, policies and procedures are easily understood and [speaker not understood]. and finally, we continue to seek ways to strengthen the civil service's commission to meet its charter mandates and oversee the operation of the merit system. in conclusion, our budget request, we are not one of the departments that are reviewed by the budget analyst office, but we have modest requests for increases. for -- our current fiscal budget is 92 2,5 02.

next year we're asking for 1,119,109. 15-16 slight increase, 1 million 826 [speaker not understood]. [speaker not understood] negotiations with labor unions. in addition, increases in work orders of the department of human resources to conduct best practice resource and with the city attorney's office to assist the city in navigating money, complicated legal issues that we find ourselves reviewing in the course of our merit system review. we don't expect any changes to our fte count over the next two years and we don't have any projected overtime costs. . that's my presentation. if you have any questions. >> thank you, ms. johnson. colleagues, any questions about our civil service commission? okay, much appreciated. thanks for being in front of us. >> thank you. >> and with no budget analyst

report, you're off the hook. >> great, thank you. >> thank you. all right, up next we have our controller's office. i believe mr. rose just handed out revised budget reports for those. >> good morning, supervisors. ben rosenfield, controller. as you've requested, mr. chair, we've got a very brief walk through of our proposed budget for the next two years and i'll start off by saying that we have come to agreement with mr. rose with his revised report which he'll speak to following the presentation. at a very high level, as you've requested, the controller's office budget for the next two years are all funds growing to

55.8 million at the second year of the two-year budget. and as i'll talk about in a moment, almost the entirety of the increase you're seeing here is related to very exciting and large project that we're undertaking to replace the city's financial system and i'll talk through that in a moment. similarly, you see growth in ftes in the controller's office being driven by the project as well as we've summarized on this slide. >> mr. rosenfield, real quick, madam clerk, can you call item -- let me get these other items called up. call 7, 8 and 9 while you're up here as well. were you -- mr. rosenfield, were you planning on speaking on those during or do you want to do it separately? sorry, 7, the neighborhood graffiti clean-up fund. 8 was adjusting access line

taxes to cpi -- >> why don't we speak to those when the departments come up if that work for you. >> got it. sorry. go ahead. >> just to recap our budget as a whole, as you're all aware, we provide a [speaker not understood] of host functions for the city. [speaker not understood]. we call emerge. we run the city's accounting operations and care and feed the financial system upon which those activities are completed. we provide a host of different analytical functions including budget analysis, economic analysis, debt management services. and then lastly, we have a host of responsibilities assigned to us by the voters related to the city services auditors functions which includes both financial and management auditing as well as a host of technical assistance serve is he we provide to city departments. and, again, you can see this new piece of the pie, the blue in the top right corner 8.2 million proposed in 14-15 to

move forward with the replacement of the city's financial system. so, very briefly to provide background on this project, this board and the mayor last year approved the beginning of hiring for this project and the beginning of funding for us to begin scoping it and pushing it ahead. the city's existing financial system is very old at this point. the system was first implemented in 1980. approaching its 35th year anniversary. it runs on a mainframe. it's not quite blue screen but it's close to it. the last major upgrade to an online version occurred in 1996. so, nearly 20 years ago. there's been one subsequent upgrade since then, but even that upgrade which was more modest in scope was over 10 years ago. this is a system that's no longer supported by the vendor that initially provided it.

it was the standard at the time that it was adopted over 30 years ago. by jurisdictions we're one of the last legacy users in the system in the state of california, for example. the system does a lot and has done a lot of good things for us for a number of years, but it has limited functionality when you compare it to current product. most of our purchasing, vendor management, inventory, and some of our more complex project management activities now occur in subsidiary systems. so, while famous, which is what we call the city's financial system, sits at the heart of this, we have a growing proliferation of subsidiary system owned by the department around the edges of it and that limited functionality really inhibits the city's ability to do good work. again, you appropriate planning fund in the current year budget. with those we've completed initial product demos. we've hired key department staff including mike deer man

who will be serving as the project director ~. and we've undertaken a host of benchmarking and reviews at the marketplace to get a sense of what products are out there and what they can do for us going forward. our hope, our current hope is that the goal wide for this system will occur june 20th, 2018 so it is a long project to get implemented. we do estimate currently a $60 million [speaker not understood] and this budget appropriates the first $20 million over the two-year period of which $12 million comes from the general fund and an additional $8 million over the two years from various enterprise funds. we have a lot of other activities going on in the controller's office. just to mention another few key initiatives ahead for the year we are very actively moving to push forward a number of green operational improvements. really our focus for the year is going to be focusing on

paperless pay for city employees. however, 90% of city employees currently receive electronic payment or direct deposit, but the majority of those continue to receive a paper advice, telling them what we deposited into their account. our hope in the year ahead is to move to everyone on either direct deposit or having a debit card that we can pre-load for them and moving away from paper advice, which is districted throughout the city every two pay periods. we're envisioning rolling out a number of new employee subservice features with our new e-payroll system. which allows you to go online and change your deductions yourself rather than having to go through your payroll clerk. we've been working actively over the last couple years to enhance public reporting, key financial and performance information in the city. sf open book is an online portal that lets a member of

the public or staff here in the city go and search and review information about what the city is spending, what our budget looks like, who we're contracting with, how much we're spending. we've added to that some features regarding key department performance information through the government barometer and we provide real-time updates to economic information in a way that's self-navigated for member of the public as well and we look forward to enhancing all of those in the years ahead. and then lastly, as always, we're working to push out city-wide performance management to more and more corners of the city. we do that through a number of different efforts in the office, largely driven out of these services [speaker not understood]. benchmark reporting, the city survey will be conducted this year where we service city residents regarding their perception of city services. we are working to promote different staff programs in

various departments that enable real-time use of information to govern and drive department decision making and management. and then a host of other efforts. so, a very quick walk through the controller's office year ahead and i'd be happy to answer any questions from the committee. >> thank you, mr. controller, and for all of your continued work. colleagues, any questions for our controller? mr. rose, can we go to your report, please, your updated report? >> that is correct, mr. chairman, members of the committee. on our revised report, if you look at the last page prior to the detailed cuts which are on the very last page, our recommended reductions of the proposed budget total 250,2 27 in fiscal year 14-15. of that amount in recommended reductions or ongoing saving these reductions would still allow an increase of 7,729,438

or 17.6% in departments fiscal budget. the [speaker not understood]. 3,5 84,086, [speaker not understood], 15-16 budget. and as i understand it, the controller is now in concurrence with our recommended reductions. >> okay, thank you, mr. rose. colleagues, any question for our budget analyst? okay, great. i just want to say how great it is that we're putting that money into the financial system upgrade. i think it's something we probably could have used a long, long time ago, so, nice work. okay. seeing no comments, why don't we move on next i think [speaker not understood]. monique is going to do it. >> yes, mr. chairman. and also if the clerk would call items 7 and l. ~ 8. >> madam clerk, can you call

items 7 and 8? >> item 7, ordinance adopting the neighborhood beautification and graffiti clean-up fund tax designation ceiling for tax year 2014. item 8, resolution concurring with the controller's establishment of the consumer price index for 2014, and adjusting the access line tax by the same rate. >> good morning, supervisors. monique zamuda, deputy controller. general city responsibilities is a department that the controller's office manages on behalf of the city and county. it contains funding that will be districted throughout the departments for various purposes. so, for example, the m-o-u reserve, general city responsibility, all of our general obligation repayment rests in this area as well as the litigation reserve. and, so, the budget analyst has recommended some modest reductions that we have agreed to for next fiscal year and subsequent.

for items 7 and 8, you do have a summary on page 18 of the budget analyst report. item number 7 is an ordinance that would adopt the neighborhood beautification and graffiti clean up, [speaker not understood] tax year 2014. and item 8 is adjusting the rate annually by the consumer price index for the access line also known as a phone tax. that particular adjustment would result in an $8 47,000 increase to our general fund revenues, which has been incorporated in the budget before you. >> thank you for your presentation. we can go on to mr. rose's

presentation. >> yes, mr. chairman and members of the committee. first of all, on page 18 of our report regarding item 7, that's the neighborhood beautification graffiti clean up [speaker not understood] tax designation. we recommend that you do approve that ordinance as well as item 8, the access line tax. we recommend that you approve that proposed resolution. on page 19 of our report, our recommended reductions to the proposed budget total 275 in 14-15. they're all ongoing savings. [speaker not understood] or 11.5% for the department's 14-15 budget. our recommendation [speaker not understood] 275,000 in 15-16 of that amount, all 275,000 are ongoing savings. and as i understand it, the department concurs with our recommendations.