there are three areas of the shortfall. one is the construction budget is adjusted upwards by $6.5 million. this is due to unforeseen conditions, higher than expected bids on trade packages and limited number of bids. the construction contingency will be adjusted up by $7.9 million. this will bring the contingency to 17 percent which is just short of the average percentage used for historic renovations. i would note that the current exposure with 46 percent of the construction completed is $7.5 million. there is also an associated construction management general contract or contingency fee of $60

million. as you know the board of supervisors previously approved legislation in january allowing the war memorial to sell development rights and tdr is supposed to pay this appropriation. i will let you know that we have our dpw project manager here and i have additional slides to go through on the veterans building if you would like more detail on that. otherwise i will just show you our picture of herbs theatre construction in progress. you have any questions, i'm happy to answer them. >> thank you. it looks beautiful right now. i'm sure it will look more beautiful later. okay, why don't we go on to the budget analyst report. thank you for your presentation. >> mr. chairman, members of

the committee. shall i comment, mr. chairman on items 12 and 13 which i think have been called? >> please do. 13 is issuance of commercial paper and 12 is the appropriation for that. >> exactly. it's a $14.5 million request for the seismic upgrade project. we've analyzed it and we recommend that you do approve both of those ordinances. regarding the budget on page 256 -- 25 report. a one time savings a million, 6 in the 14-15 budget. we have no recommended budgets for 15-16 budget. it

is shown in our report. >> thank you is there any ponlt -- possibility of that reduction staying with the general fund? >> our understanding is that -- go ahead. >> supervisors ben rowsen field, the war memorial is funded from a different sources and revenues in general fund report. as a legal matter the committee can make a choice whether or not to return the savings or to the general fund. that would be a discussion. >> then on that basis, we would recommend, i don't know how the department feels it would be general fund. >> i would, thank you. i

appreciate the recommendation. i would concur with that and i know that we are making serious investments in the memorial building and will continue to do so. i would expect that we wouldn't have any funds where they weren't needed. we would fill that when the time would come. i would like to recommend if we approve the recommendation we approve the recommendation that these funds stay in the general fund. >> the department concurs? >> yes, we do concur. we had understood from the mayor's budget office that it was a technical correction to be submitted with an offset to fund balance. we will have to look with the mayor's budget office to see if that is going to affect our fund balance for fiscal 15-16. >> okay. >> if that money is to go to the general fund.

>> you are thinking not 14-15, but 15-16? >> yes. >> i would like to think when it comes to next year we can work out those issues when they do come. okay. mr. rose? >> the only question is the department requesting they come back next week or is the committee wanting to consider this as the general fund. we'll do whatever the committee states. if you take it as a general fund reduction, you would not hear the department next week. if there is still a question, we will be happy to report again on this matter. >> okay. thank you. i would like to motion that we take it at the general fund or addition to the general fund. colleagues, if you are okay with that, the department won't have to come back next week. ms. breed.

>>supervisor london breed: i'm definitely okay with that, but it was my understanding we weren't going to take any motion without public comment. we can do this today? >> we have been taking budget analyst recommendations. it will be final after. >> okay i'm okay with that. thank you. >> great. we can accept the budget recommendation and the funds be returned to the general fund and that will be pending after public comment, final votes on the budget. okay. >> i think i'm okay with that. can i say what are the in terms of what are the ram if ification of doing that? >> as i understand ms. murray's concern she's concerned that there is an error in the budget and it may leave her with inadequate fund balance. we can validate that

in the week ahead in the extent that it does become an issue. we can report to the committee on that. >> how confident are you that there is an error that led this recommendation by the budget analyst? >> i'm not 100 percent confident. i know that the error was supposed to be submitted by the mayor's office as a technical correction. the back filling or moving it out of the general fund as opposed out of fund balance is a new concept for me today. i have understood the correction is part of the correction and fund balance. >> can i ask the mayor's office to respond to that? department has indicated there is some technical adjustment by the mayor's office. i just want to make sure we know

exactly what the ramifications might be. >> supervisor, kate howard, through the chair, as we know the mayor's office makes technical corrections to the budget during the board's phase. we have been working with the war memorial department to address this particular issue and as you know their budget is funded by both fund balance. essentially a general fund transfer as well as the revenue. and i think we've been working with director murray to kind of create to make sure the department has a stable set of funding sources over the coming years. we would be happy to work with her, with the controllers office over the next week to identify what amount could be returned to the general fund if there is, if not this whole amount. we were intended to company a

whole technical correction later today on this issue. >> what would that technical correction later today be? >> it would be to return those funds to the war memorial on the fund balance. >> the entire balance? >> that's correct. >> so if we were, obviously any vote we take today is tentative. it's really not a real vote. >> deputy city attorney gibner. this committee is not voting. the controller is tracking the greelts of -- agreements of the department and you can ask mr. murray to come back next week or not. either way the committee can consider the war memorial budget as part of the entire budget. >> i know this is an outstanding issue and we would like to move this $400,000 into the general fund for to

be able to reallocate that money. i also want to make sure we are being respectful of the fact that the department is stating there is an error and over the next week that will be figured out. i don't know -- >> since we are not making a decision, it doesn't matter. it's been noted an it's out there. either there was a mistake or there wasn't. >> you can make the reductions today which isn't an argument and we can simply outline the choice here and the issue here and the committee can consider this choice of whether to leave it in fund balance or take it to the general fund with that information in hand as part of next week and part of your final deliberations. >> why don't we do that. everything is tentative right now anyway in spite of public comment. ms. breed? >>supervisor london breed: the budget and analyst report

because the expectation that it would go to the fund balance and not the general fund? >> okay. colleagues, any further questions or comments? >> we'll see you back next wednesday. thank you very much. okay. up next we have our children and families commission. madam clerk, can you call items 10 and 11, please. city clerk: item 10: [approving expenditure plan - san francisco children and families commission - public education enrichment fund - fy2014-2015] 10. 140636 sponsor: mayor resolution approving the san francisco children and families commission expenditure plan for the public education enrichment fund for fy2014-2015. 6/3/14; received and assigned to the budget and city clerk: sf 101234 item 1: 14069: [proposed annual budget and appropriation ordinance for selected departments - fys 2014-2015 and 2015-2016] 1. 140619 sponsor: mayor proposed annual budget and appropriation ordinance appropriating all estimated

receipts and all estimated expenditures for selected departments of the city and county of san francisco as of june 2, 2014, for the fys ending june 30, 2015, and june 30, 2016. city clerk: sf 101234 item 11: [approving expenditure plan - san francisco unified school district - public education enrichment fund - fy2014-2015] 11. 140637 sponsor: mayor resolution approving the san francisco unified school district expenditure plan for the public education enrichment fund city clerk: sf 101234 sf 111234 >> okay. thank you. >> good morning. supervisors and colleagues. i'm going to present the first san francisco and children's families budget for fiscal year 15-16. you can see on our first slide the allocation for 14-15 is $27.4 million. we have some in interest and using about $4.7 million out of our reserve. making our total revenue $35 million. with prop 10, the tobacco allocation from first five california.

we'll have about a $5.5 million. we have a special project called the signature program which is additional $6 million. this money is targeted to the bayview mission and the valley for programs to enhance the quality of their preschools and infant toddler classrooms. we have the race for the top dollars from the state down to us. it's to develop a quality rating and improvement system for early childhood programs. we have interest and mous 1.2 $1.2 million of of our reserves. you can see the major expenditure categories, most of it's goes into programs and program infrastructure and evaluation. again we have a comparison of our programs from 2013-2014

and we are increasing all of our money and you can see by the percentages. you see a pretty significant increase in the program infrastructure. this is about the training and professional development and capacity we are doing. these are major investments. preschool enrollment and subsidies about $13 million from prop h and $1 million from prop n. this is from operating grants and reimburse a. and from the capital line for technical stants -- assistance for prefa and competition and wages and some money for higher education for early childhood teachers and

family support and curriculum enhancement. that's in child development. in child health we have consultation and children with special needs and healthy kids and fund a multidisciplinary and san francisco general and health screening and all are in partnership with dcyf. for family support, we partner with dcyf to fund 25 family resource centers. and then we also have a capacity building line for family resource centers to bridge the work of family support to early childhood education center. this is just a little snapshot of what we've been doing around children and bfa. we are funding about 3280 children in part day or full

day presooner or later -- preschool. and the vouchers because they are no longer eligible and we guarantee them a full preschool experience and taking them off the waiting list and placing them in some of our pfa classrooms. we are funding preschool phases. this is a pipeline of preschool children that will come into mpa families. this will be about 5.8. next year is $23.2 million. we have invested a million dollars last year and the next year and after for the facilities. we are using our $7 million of prop h reserve for the restoration of the cuts.

that's $1.8 million annually. we have our preschool plus money which is about 2.6 million, and a long term investment in family resource centers mental health screening and special needs. here is an outlook for prop h, it sunsets as you know next year and will be using our reserve pretty much totally by the time the sunset ends. a little different picture for prop 10. we are making substantial investment using our sustainability fund over the next few years and then in fiscal year 19, we are going flat with the basic tobacco tax allocation. and that's only if we don't get any of the matching fund programs.

usually we get an additional $6-7 million. so that's us. >> supervisor avalos? >> >>supervisor john avalos: thank you for your presentation. just a question, a couple questions i had. you have, what is your reserve? how much is that amount there. you have user reserve. current year and next year and down to 2.4. if you can explain what the overall reserve is and what is the reason for the big decrease between fiscal year 15 and 16? >> we are using our reserve now. we've been accumulating a reserve over the last 9 years. some of it was slow start up with prop h money, but some we had to use our additional prop 10 $10 to cover it. we grew a reserve. we intentionally, the other thing is we saved money

when our, when we were supposed to get a $20 million allocation and reduced because of the budget short falls to 15. we had to keep going. the trigger was pulled for the number of years. this year we have a lot more money, maybe $10 million additional dollars. so we have money from our savings. we decided we needed to use that reserve to serve additional children. that's why we did the back fill, the bridge money and the voucher, the preschool plus to drive down. we are just spending it and when it gets reauthorized hopefully we'll continue to cover the cost of providing. >> then, this current fiscal year you have $6.1 million. that's the entire reserve or it gets replenished every year? >> it's 16.5. that's their

beginning fund balance. this year, last year we used 6.12, next year for the reserve went down at 210 and next year we are using 7.51. we just keep drawing it down. >> okay. then after fiscal year 16 how much do you expect to have left in it? >> i hope to use a couple of million dollars and use in that transition period. >> then after the funds in your slide in 2.5 and 7.4, that's on the base side of the reserve? >> exactly. >> all right. thank you. >> colleagues, any further questions at this point? okay. thank you for being in front of us. >> thank you. okay. next up,

dcyf. >> good morning, chair farrell and other members of the committee. i'm actually using the projector here. my name is maria sue. the director for

derpt of children and youth and families. i would like to thank the mayor's budget analyst as well as the staff. so just a brief background. san francisco has a deep and very long commitment to families. in 1991 san francisco became the first city in the country to guarantee funding for children and youth services in voting the amendment in this city charter. every year since then the city has set a portion of property tax revenue to create what is known as the children's fund. the department is the city agency responsible for ensuring that the children's fund dollars as well as the additional resources allocated from the city's general fund and through state and federal grants are invested for direct services and impact for our

children's and families in the city. this past fiscal year 13, 14, dcy f invested over $180 million to over 185 services. our supported programs serve one out of 3 san francisco children and youth plus their parents and extended families including students at every public school and families living in every neighborhood. annual dcyf investment reach more than 56,000 children and youth up to 24. we invest in things such as quality, early care and education, making it available for more than 3,000 children in our city. bringing comprehensive after school programs to more than 10,000 elementary and middle school youth. funding programs serving more than 13,000

children and youth. connecting over 9,000 teens with skill building opportunities, paid jobs and internships that builds real world skills and bringing counseling to 5,000 teens at public high schools and helping nearly 10,000 parents and caregivers in support programs and providing thousands upon thousands of meals every single summer for our children and families. so during the 2010, 2013 funding cycle you see the base approach on focus on tracking the goals of children are ready to learn and succeeding in schools. we continued

this approach for the 2013-2014 grant cycle which includes the dcyf partners. we maintain the outcome on learning and success and focusing on wide range of support outcomes are preconditioned to make this impossible. we increase to our summer employment. the mayor has challenged the city department as well as the private sector partners to hire more 81 -- young people from 18-24 to provide meaningful skills and we also increase programming for our younger residents to have meaningful opportunities at camps and other fund programming throughout the city. i invite all of you and

other members of the board of supervisors as well as the rest of our city to join us on the steps of city hall this friday at 11:30 as we celebrate the national learning day with the rest of the country. we continuously strive to improve our accountability and quality of services through professional development for our cbo partners and having robust evaluations and assessment of our services and working with partners throughout the city to ensure we are leveraging out the resources. so this is our departmental budget. the department's budget is made of four funding sources. children's fund, general fund, grants and the school district fund. the children's fund continues to increase due to the improved economy. about $3.8 millionch additional

funds has been added to the funds this year. general fund remains at 3 $31 million due to our very low general fund reduction and violence and it intervention service area as well as our nutrition at work. so the department's budget is allocated into four categories. operations, work orders, grants to cbo's and school district. the department operations include dcyf staff, administrative work orders, materials and supplies and rents. it includes our capacity for contracts and provides healthy meals and snacks to programs.

this makes up 6 percent of our total budget. do dcyf collaborates with departments and we fund variety of children and youth family programming including early education and wellness centers. dcyf provides $24 million in work orders to fund these programs and services. the proposed 14-15 and 15-16 budget includes over $54 million in funding to our community based partners. funding to our partners is the department's second largest expenditure in the 34th expenditure in the budget. the school transfer due to peace and rainy day, the school district transfer is over $70 million and comprises 45 percent of our budget.

a couple of our highlights. so i said earlier over 90 percent of the department's budget fund direct children youth and families services. the school district transfer funds pass through our budget makes up 45 percent of our budget. with the increase in the children's fund, we hope to be able to use that to continue to support grants that will increase summer services and programs as well as workforce development and opportunities to our young people. we allocate $24 million of funds to other city departments to provide direct services such as mental health services for children on school site, all the high schools, partnering with the human services agency as well as first five to fund the family resource centers

which we have 25 throughout the city and then partnering with the office of early care and education to fund and support the early care and education service area for the city. the department continues to of course focus on improving quality and providing professional development for non-profit agencies. and building a more robust evaluation and assessment portfolio. and with that, i conclude my presentation. i do want to take a moment to recognize the great work of our cfo, madison who has worked with me at dcyf over the past 5 years. this will be her last year at working at the budget at