wish to read that in to the record? >> ok. i will. we're ed lee was the first asian american to serve as mayor of san francisco he was the first appointed by the board of supervisorers in november 20, 2011 and re-elected twice and mayor lee was raised in public housing in washington and moved to the bay area to attend law school in berkley in 1978. where as, mayor lee devoted his early career to advocating for affordable housing, rights of immigrants, and rights of rent ers through his work at the san francisco asian law caucus. where as ed lee had a long and productive career working for the city and county of san francisco including executive district or of the san francisco human rights commission and director of city purchasing, director of public works and the city administrator. where as mayor lee was strong supporter of the san francisco

department of public-health, it's programs and its clients. he sought humane and lasting solutions to the issues at homelessness, untreated mental illness, and substance abuse in san francisco. he supported and funded the creation of the city's first behavior health navigation center at humming bird place on on the campus. and he was an avid supporter of the getting to zero initiative and backfield h.i.v. funding for the sfph programs. he launched an innovative program in 2016 to help san franciscoance afford health insurance through the san francisco covered m.r.a. under the city options. he was a champion for the vision zero collective impact initiative which increases safety for pedestrians and bicycleists while reducing injuries and death. he supported the implementation of assisted out-patient

treatment in san francisco giving families a chance at connection to treatment for loved ones suffering from mental illness. he put a generous amount of funds and reserve in the fiscal year 17-18 and 18-19 budget to protect the city against potential federal threats to the affordable care act and healthcare funding. he supported the san francisco department of public-health developments of an integrated electronic health record system through funding of the project and approved innovative funding mechanisms which the san francisco department of public-health could fund the initiative through safe revenue. he ushered in the rebuild of the sucker burg san francisco general hospital and spent time with patients at the general hospital and laguna honda hospital in addition to visiting the sfdph heath centers where mayor lee created the department of homelessness in support of housing to focus efforts to

prevent homelessness and assist those who are homeless. where as, mayor lee advocated for affordable housing and many ways including pledgeing to build and rehabilitate buildings intended for low-working and middle-class joining the board president david chew to reeight the housing preference program to assist tenants evicted through the ellis act sponsoring funding initiatives where mayor lee died december 12th, 2017 at san francisco general hospital and be it resolved the san francisco health commission acknowledges and honours mayor lee for his life-long commitment and dedication to improving the lives of others through his invaluable public service. his enormous compassion for others and his effective and thoughtful leadership and be it further resolved that the san francisco health commission conveys its heartfelt condolences to his family,

friends and colleagues. i hear by certify this san francisco health commission at its hearing at its meeting of december 19th, 2017 adopted the foregoing resolution. >> any comments on the resolution? otherwise we prepare for the vote. all those in favor the resolution please say aye. >> aye. >> all those opposed. resolution has been approved. >> thank you, i will make sure they get a copy of that resolution. item 7 is resolution in honor of colleen, i'll note this resolution was read and presented at the december 5th information meeting and that today is the day foray approval. >> motion foray approval of the resolution for colleen is in order. >> all those in favor. >> second. >> ok.

further discussion. if not all those in favor of the resolution, please a aye. >> aye. >> those opposed and the resolution has been approved. thank you. >> i will make sure that she gets a copy of the framed resolution. >> thank you. >> item 7 is resolution support of vision zero and automated speed enforcement and cindy will explain and the version you have in your packet has tracked changes because it is a version you all passed recently last year, i'm sorry, this year and this is a revised version. >> ok. please, thank you. >> good afternoon commissioners, here with the updated resolution for automated speed enforcement for your consideration. the original resolution was passed in may of 2016 for vision zero and automated speed enforcement and i want to give you background on the automated speed enforcement and why we're

asking for your consideration for an updated version so the version original version was passed in may of 2016 and fortunately that year we were unable to get an automated speed enforcement bill introduced but fortunately in february of 2017, the general hospital with assembly member chew mayor ed lee and the mayor from san jose, the streets act of 2017 was introduced and this bill would allow for both san francisco and san jose to have a five-year pilot pharoah program of automated see enforcement. and the bill after it was introduced it was double referred so it was referred both to the privacy committee and to the transportation committee the bill passed through the priv' committee and when it got to the transportation committee. they thought it was best to turn

it to a two-year bill was we weren't sure we had the votes for it to move forward and the department of public-health has been working closely with the m. t.a. for the past nine months trying to gather support and do more out reach and education not only automated speed enforcement but our vision zero initiative in san francisco. the bill is schedule for the transportation committee hearing on january 9th and we are seeking for commissions and constituencys that supported this bill to renew their support as we go in to this transportation committee meeting in the againing of next year -- beginning of next year. so the resolution is very similar to the original resolution that was passed and there were a couple updates and the most notable the national transportation board came out with a study that really sum

enter theed correlation between speed and fatalities, traffic fatalities and also recommended that all states removed barriers of having for automated and this was a really necessary tool to achieve our vision zero goals. i'm happy to answer questions but our vision zero team is on vacation for the holidays but i can try to answer questions or get back to you with information thank you. >> thank you. >> if not the resolution -- a motion before us. >> i want to make one comment in the last year i've noticed on the buses the adds about speed and the vision zero desk i find

them effective. i slowed down and people around me are slowing down so i wholeheartedly support any campaign to get us there, thank you, very much. >> yes, please, commissioner. >> hi, how are you. >> quick question about a a assemblyman chew, it creates a pilot program for those two jurisdictions san jose and san francisco that with the intention of it bringing results that would then help create a state-wide program? >> that's correct. there was pretty wide opposition throughout the state and so having the two pilot projects that have local support we thought it would be more effective trying to introduce this new technology and move it

forward. >> thank you. further discussion. if not we're prepared for the vote. all those in favor. please say aye. >> aye. >> all those opposed. so good luck. >> thank you, very much. >> commissioners item 9 is the s fph budget. there's a long presentation from mr. wagner. very informative and interesting presentation. >> get some coffee. [laughter] >> as we go in to this we normally would have a less format setting for the ability to have a dialogue around the subject that we have at hand as in our past planning sessions. however, so for today, we are going to try to do something that would allow everyone to have input and make their

thoughts known and prepare for the future by going through each of the sections and stopping at each of the sections for commission and other comments that may come from staff and then proceed onto the next session knowing barbara has to go to a department meeting during part of this if there are questions we wanted to reserve for her we'll wait for her to return. and we'll set those aside. you can make the comment and we would then present those to her when she got back to put them back in to the context. it's not totally ideal as a set up but i think what those of us who plan this one to do is to begin top layout just before we go in to the budget for the coming year and this may be even more important with the

potential transition and changes of leadership and government, where we stand in terms of our resources and how we are planning for the future. so this is a background a year ago we went in to a good part of it where we got in to the details of parts of the pools of funding and hopefully then today one can look at and see how those actually effect programs and what one with do about programs that are related to our budget. and so we will ask for -- is there any public comment on this topic first? >> i received no request for public comment. >> ok, so, from this point on then we'll have accepted there were no public comments and dialogue will be between

therefore the department and the commission and certainly if staff members also have something they want to weigh in on that could help they just sort of raise their hands because this is not really a roundtable and we'll call on them in order to add to the dialogue. i would encourage that we'll need to try this format for right now. so with that, mr. wagner. >> thank you dr. chow. i think the overview and the context he gave is exactly right we did this last year for the first time and the item was as the city goes through its five- year financial outlook we've tried to kind of piggy back on that process and look within the department of

public-health and see where we fit in to that broader outlook to try to give ourselves some background and some context for the budget that we're going to enter in to for the next two years but then also to start thinking beyond that and imagine what the next four to five years will look like in types of decisions that we have to be thinking about now in order to impact our trajectory over the next five years. so as dr. chow said, we've got five sections, i do want to try to kind of plow through this but i do want to make this useful to all of you so i'll let the discussion and questions to the extent that you have them guide where we spend time. so, first section is just to go through where we are in terms of the city's financial picture and the instructions from the mayor

's office as you know, this year, this time each year we get the official projection from the mayor's office which is sort of a kickoff of the formal departmental budget process and the mayor's office working with the other city stakeholders as a projection of revenues and expenditures for the general fund and uses that to develop policy instructions for the departments to guide the submission of the budget to the mayor's office and in february. so the slides that i'm walking through right now are borrowed from the mayor's office presentation to us so i'll just recap what that presentation looks like and we'll dive in to more d.p.h.-specific numbers. so there are two things going on , the short term and the

medium to longer term and in the short term, the fiscal picture is close to last year. there's a deficit but not what we experienced in the years following the recession and so the deficit is not huge but it is significant and it is going to require some financial restraint to get threw this two- year budget and in the medium and longer term the picture looks different and there are slowing of revenue growth compared to what we've seen in the last five or six kind of super charged years of economic growth and we're still growth but not at the rates we have been and expenditures are growing faster than revenues, a couple of those areas are employee costs which is always a factor for city budgets and our budget and there are state policy changes including a big

one one on ihss in home support services which is shifting a significant portion of that program onto the countys from the state and we have voter approved baseline set asides which are carving outgrowing share of general fund dollars dedicating those dollars to a specific mandated services approved by the voters. we also of course are doing this in the context of what is happening at the federal level so that is something that is area of uncertainty and of course the economic climate is something that is perpetually worth watching. so the high level snapshot of the approach on the budget is to continue to do financial planning with an eye towards the future of building reserves and limiting the growth in our on going costs and being strategic about where the money goes so that when we have dollars we're

putting them towards investments that will payoff over many years and so those are all things that are very well aligned with our approach at d.p.h. and a lot of our focus for the last two years and our financial planning. the instructions to city departments are to reduce our level of general fund support by 2.5% in the first year and 2.5% in the next year so it's relatively similar to last year and last year it was 3% and another 3% so we're on the same order of magnitude. just we'll get to if a little bit more later but the dollar value of those changes is about 16 and $32 million in each of the two years of the budget for us and in addition to covering all of our other new costs. the other significant instructions and we'll see, i'll

explain to you the reasoning for this but again no new f.t.e.s that was an instruction last year we're expected to accommodate our needs and operating new to the budget. so, the mayor's office financial projection again for the update from the five-year financial plan covering four years and it looks at the revenue growth and again the economy is still strong and in certain areas the rate of growth is slowing so we're getting back to a normal, stable rate of growth as you remember during those few years after the recession ended in the city started a recovering and we're really seeing astronomical rates of growth by historical standards in the city economy and jobs started coming back and property values escalated business taxes, hotel taxes were

all coming in at highlights of growth and salary and benefits of course are continued cost growth but projection assumes we have inflationary increases in those rates and some other calculated rates for benefits and pensions and then other city wide costs. so here is the high level picture from the financial projection, these are millions of dollars by the fiscal years of the projection so you can see at the top total sources that's the growth in the revenues for the city and then below is the growth in the uses if you look at fiscal year '21, '22 you have revenue growth but then compare that to what you see in the uses

which is $1.1 billion of expenditure growth and you can see how that imbalances growing overtime to the point where the four-year outlook shows $709 million deficit which is a very sizable deficit now that of course is projection that says if we just let present trends continue doing nothing about it, that is what will happen but of course, we're not going to do nothing about it we're going to do lots of things about it and that is what subject of the financial work we're doing now. one other item to note on this slide in particular is if you look at the salary and benefits line in fiscal year '21-'22 that number is $559 million of growth and that number alone is greater than the growth in the total revenues. so all of that projected revenue growth is being consumed by the

rate of growth in our employee costs. that is the reason for the instruction about no new f.g.e. s the city is historic high in the number as the health department and so the idea here is because of the rate of that growth every time you add new f. f.d.e.s you compound that cost to the future and it's exacerbateing the gap between expenditure and revenues so there's a strong instruction for us to limit our f.d.e. growth for that reason. here is a high level break down of how the cost increases shake out so half of them again are salaries and benefits we're half the salaries and benefits and then other operating costs and growth and baselines and set aside as i mentioned earlier.

on personnel, the number of factors that are pushing on those personnel costs upward, pension is a big one, the picture on the amount the city needs to contribute to the pension costs has changed for the worse for a number of reasons over the last couple of years and it was expected the contributions the pension fund would decline at this point in time but a number of things including a loves a lawsuit, the level of returns on the pension fund's investment and demographic of retire res has changed and pushed the forecast of those costs upwards and it has a big impact on ours in the city's total expenditures. we of course have continuing growth in wages which is reflection of the labor market and the economic climate in the region and then our health costs for employees are also

continuing to grow at a faster rate than the economy. this is another illustration of the effect of our employee costs on the bottom line for the department and for the city and this is a history since 2007- 2008 of the rate of the growth and employee costs versus normal inflation so the bottom green line is normal inflation and the economy and the consumer price index and the top line is the rate of growth in our employee costs so you can see that our employee costs are going much faster than you would have normal inflation in the economy and that's i couldn't see those costs really pushing the gap between expenditures and revenues and driving the deficit and again the reason for the no f.t.e. instruction. i will pass on that slide and move to the next one.

the same concept which the mayor 's office and controllers' office always use to remind us and i find a helpful reminder but these are the bars is the length of the time between recessions so if you have a period of one year of recessions it's a bar graph of one so each year shows the starting point of an economic expansion so you can see that in 1991 for example, we began a period of economic expansions so no recessions consecutive periods of growth that lasted about ten years and the dark blue-line which is the third from the right is the current economic expansion that we're experiencing so that's been going on since 2009 and we're at a little over eight years and that tells us that if we go through this upcoming two- year budget cycle, without

experiencing a recession we will then be in the longest continuous period of economic expansion since we really have reliable economics data so the city is not forecasting a recession but you keep this context in mind it's a helpful reminder we should keep at the front of the mind it's certainly possible from the historical perspective that we can have an economic change in the economic cycle within our planning horizon and we should start to act in ways that create cushion for ourselves if that's the case another kind of caution on the horizon is when you look at the way that the city has balanced its budget and how we're using different sources to pay for our operating costs, this graph those you a couple of big one- time revenue sources that

had been used to balance the budget and first this fund balance that is the dollars and the surplus we end the year with and spend forward coming the two year budget and the blue at the top is the property transfer tax and the property transfer tax is when a property changes hands it comes in to the city's general fund you can see how it has grown dramatically over the period of the economic expansion that's due to the rise in property values and you can see also kind of what happens to that revenue in prior periods of downturns. it's susceptible to the economy so a lot of city's financial projections and our current budget is balanceed on the assumptions that we will be able to continue to see that high rate of revenue from property transfer taxes if there's a change in the economy that significantly effects property

values that can drop significantly it's a risk to the city's budget. >> so looking forward i won't go in to these in detail but risks from the federal you are familiar with most of the number of different area were policy changes that could effect income to the city the biggest and there was to be a change to the medicate funding have been proposed earlier in the year in congress that did not go through and it's something we need to be mindful of that could have a significant change to our financial outlook. so again, instructions from the mayor's office on going reduction of 2.5% and another 2.5% in the second year and don't grow budgeted f.t.e.s we need to submit a budget to the

controllers' office by february 21st could combine with those instructions and our numbers are 16 and a half million in '18-'19 growing to 33.1 in '19 and '20 so those are numbers that are big numbers but they are within the range of instructions that we have met in the past. so that is a summary of what the mayor's office presented to us and i'll take a moment and see if there are any questions or conversations on it. >> questions from any commission ers? >> see how clear you were. >> we'll troy to keep the streak going. >> what is our total budget now? >> our total budget is a little over $2 billion. >> ok. >> so we're putting the 16 million-dollar in to that context? >> yeah and so the $16 million,

the $16 million is not total reduction to our budget but it will be after you take going from the current year to next year you build in all those increases that we know will happen so pension costs and labor contracts, inflation an our pharmaceutical that's will push our budget up and we're being asked to reduce that higher number by $16.5 million so in actuality the mayor's budget instructions is really not a cut to us and this is been the case in the past several years where essentially it's saying you are going to grow but please restrain the rate at which you are growing so we can keep expenditure growth closer in mind with revenues and so why want to get the impression it's like a nominal like you have to reduce your budget compared to the current year so we'll grow

and trim back on that growth. so next -- >> commissioner. >> i just wanted to thank you, this is -- it's an excellent protocol of what happened and it all changes even the last week the votes with congress our mayor and it's interesting when you look at it and you shared it especially the draft from 1945 we had this period of growth compared to where we are now and you think about what happened from 45 on and you think built investment i.e. in hospitals and education and rebuilding this station and building schools that's institutions of higher learning and the g.i. bill providing all of these services so we can make quote really what

the nation is all about and we take a look at where we are within the last whatever and you think about west longest war ever 16 years and you look at the industrial military complex and how many billions were spent and our schools are, everything else that was built before were education was free and we invested in education and all of our people and now it's astounding it's like we're two different world's and the other variable where there's a shift even locally in administration i cannot remember closely when they were killed and dianne came in and george had his own way and we are going to zero base budgeting and all of a sudden we had it revised and our staff

went through a whole top see topsy-turvy and we've had outstanding input and we were able to track the best of the best and you folks have been fantastic but again all these variables are -- it's like really watching two nations that are totally different and what we're about and thank god for the city but i mean, we're going to be hit as we all know i mean, the variables brings us back to there was a out beat client but i think about the leadership over the years and as our president has said our mayor was such an exceptional person and there was a thing called men to match our mountains and they looked at yo sem tee and so fourth and you think about we had a mayor that not only match people went through mountains building those railroads,

building access here and all those clinical trials that went through and look what he went over the mound and his commitment to what our institutions were, what our democracy was is unparallel and then here we are in this other world dismantleing everything, we all know it's every day and you think where are we as a nation but thank god we're still here in the city county still navigateing that we have a lot of challenges but you staff have been through so many challenges and whatever and there's going to be more challenges coming in but as was mentioned in the services, they wanted to thank all the staff city and county who have really pulled together to go through where we are now

and why we have the ability to do some things and some things will be challenged on but it's a team effort and anyway, the leadership you just had will feel never get again and restore dignity to public service, to what our mission is and what our values are as the city and hopefully as a nation at one point. i'm sorry, but again this budget was a budget designed by this crew. the crew and the mayor's crew and that may shift and we'll hold stead fast. thank you. >> and i will say to one of mayor lee's legacy is investment where maybe not everybody was stepping up but the city stepping up to make those investments and public infrastructure going back to a city administrator he was one of

the authors of the first capital plan and the first new version of the capitol plan and it included the rebuild of san francisco general hospital and it included the bonds that were currently spending on and it included parks a lot of that infrastructure and so i think that has been one of the f. we look at the world that we're in right now that's a big piece of that context is where we have had resources locally and we have made an effort over the last many years to invest those is in public infrastructure that hopefully will payoff over many years to come. >> thank you. >> thank you. commissioners, any other comments on this and we appreciate the perspective commissioner sanchez put us in to in terms of these aren't just mayors' instructions.

we'll move forward to the next item getting more directly in to our general fund. >> all right. so i am included here as the request of president chow and others a slide we did at last year's presentation for some context and clarity on the general fund because as you know the general fund and the level of general fund support is what really driving our budget process is what we're balancing to throughout the process and there are a couple of words that we get tripped up on often times in our financial and planning committee and other contacts which is the general fund and our level of general fund support which is what we're balancing to so the general fund is an accounting fund in the city and i think i've got some old lingo up there since we've

changed our accounting system but it's app accounting fund and it contains a lot of things and it contains general tax revenues and it also contains revenues that come from the state and federal and it contains fee revenues and it's used to pay for a lot of different things in the city and a lot of different departments including d.p.h. so within the general fund, which is an accounting fund, there is concept called general fund support and within the general fund there's a pool of tax dollars that comes in their local tax dollar and those local tax dollars are available to be allocated by policy decisions from the board of supervisorors and the mayor's office so you can see i have a graphic here showing there's the general fund within it and there's a pool of unallocated general fund dollars that can be spread around to diffuses at the discretion of

our elected officials so d.p.h. received dollars and general supports those are the dollars that are between our revenues and our expenditures and we also receive dollars that are federal grants and we earned federal and state and commercial revenue through a services that they provide to patients throughout the network and we have a significant portion of our budget which comes from that un allocate general fund dollars and it's our general fund support so the graphic up here say little convoluted and i'm happy to dive in to it if it's useful to refresh the ideas is there's that general fund un allocated dollars those have to be spread around to fund a whole bunch of city and county services and police department, fire department, rec and park department, health department, human services department the whole range of services and so

in a sense we are competing with all of those other departments maybe competition is the wrong word but they're competing demands on that pool of un allocated general fund dollars from those important services that the mayor and board need to weigh each year to balance the budget and because the demands on that pool of funds is larger than the available funds every year, that's why we're asked to take actions that restrain our rate of growth and our draw on those funds. so just to give you a little bit of a sense of perspective on how we fit in to that picture, this is a table from the city's approved budget our adopted budget you can see for example on fiscal year '17 and '18 each department and it shows how many revenues is generating and how much allocated general fund

support it is receiving so that column is important and that is the amount that they're receiving from the mayor and the board of supervisors through the budget process through that pool of local tax dollars and then they're total sources and so you can see how the dollars flow for example and there's the police department in this first section which earns $128 million per year in revenue but it receives a subsidy $460 million from the city's general fund and so on and so fourth. the department of public-health is highlighted in blue. we earn 1.5 billion in revenues from sources but we receive 715 so we draw the pool of local tax

dollars that gets allocated for us for our services. the total in the box is $4.2 billion so we receive a substantial amount of that but not the per ponderance when you look closer however, there are a lot of constraints on the discretion over the funds with the mayor and the board of supervisors have to make decisions and this is an example from fiscal year '17 and '18 so of that $4.2 billion that is legally available for the mayor and board to allocate out to city departments there's about three quarters of a billion of that amount that is locked in and mandates so for example, the voter say we're going to require in the charter that x dollars gets to this specific service those dollars must be allocated and the mayor and the board have

no discretion to allocate them otherwise and there is about a billion of that 4.2 that goes to pay for general city responsibilities which is things like retiree health subsidiaries , health service administration costs and those dollars that we must spend keep city services running and we're obligated do not have a policy choice to make to reduce them without other action and that leaves about $2.5 billion that is available that is truly a matter of policy addition correction so in that light our $715 million is much larger share puts us at about 30% of the total discretionary dollars that are available to allocate and so that is a big portion it's a much bigger portion than when you look at the higher level numbers and that is one of the reasons that our budget is a

major factor for the citys general fund balancing plan and vice versa when the general fund is in trouble we're in trouble and when we're in trouble the general fund is in trouble so that's why we're always working very carefully to coordinate with mayor's office and controllers' office on our financial planning so that it alliance with the city's approach. so any questions on that piece of it? >> commissioner. >> with regards to our $715 million general fund support at 29% how did that compare to other departments, what are the next top three perhaps? >> all right, here we go. let's see. so if you look in the second column of numbers you can see the general fund support so just

to kick a couple off they're on the prior page so you can see police department at 459 and we've got the municipal transportation agency received $313 million and human services agency $241 million so the biggest general fund recipients are are the core city and county functions so those are the public safety so police department fire department and sheriff those are all big general fund draws primarily because of the large core functions that don't generate their own revenue and on the traditional county side it's us and the human services agency so those safety net human services programs socom bine those five departments and you get a pretty large share of what the the

general fund dollars are used for. >> any questions? >> >> please have empathy for mr. wagner to stand during the presentation. >> i'm trying to go fast. >> with regards to other departments and their financial staff us, the other departments as far as you know and the most general way healthy do they have reserves like we have reserves and i guess this is if theres a battle for an apple pie how hungry are they. [laughter] >> yeah, um, it's a big question and it's a lexture so a lot of people are true enterprise departments they have their own

reserves and so if you particularly want the ones that are receiving the vast majority of their revenues are earned revenue which are general fund most have their own reserve like the public utility commission and the airport building inspection and financial transportation agency and they have reserve policies and they built their own reserves and the flip side of that is that there is no general fund to bail them out if they get in to financial trouble because they are responsible for generating their own revenues. for general fund departments, most do not center a reserve and the general fund itself there's a general fund reserve for the city and that is health and appropriateed in the budget each year we started the policy about three years ago and working with the mayor's office and the controllers' office of creating a management reserve for d.p.h. done through the budget

appropriate ordinance that allows us to as you know, when we know that there are potential volatility in our federal revenues to set aside dollars in a reserve to account for that future liabilitys that we might have and that is a pretty new policy that something that is again about three-years-old and i don't think that it is replicated in any other general fund department and the reason for that is we had a lot of experience with especially when we get these big pieces of federal revenue they're funded through an i.g.t. and they take forever to get the red tape done to get us paid so you have a short fall one year and a payment the next year and maybe you get paid twice this year and zero times next year and that fluctuation of revenue was hard to manage and caused a lot of volatility on the city's general

fund balancing so that was one of the steps that we had taken as part of the health commission 's kind of financial sustainability direction is to put that reserve in place to weather some of that volatility but for the most part aside from that so that is a big positive for us and for the city's general fund for the most part, the general fund does not have other general fund departments don't have their own reserves and i'll talk about it a little bit later in the presentation but the city has over the the last seven or eight years worked hard to buildup those general fund reserves and do better contingency planning for future downturns than had been done in the past and i think that's another financial management legacy of the past

administration. >> thank you. >> any other questions at this point? >> no, we'll, are you able to continue. >> yes. i keep plugging away. >> all right, so i want to re visit what we talked about last year which was the approach that we had adopted going in to our last five-year financial planning cycle and so as you may recall what we talked about last year and this is after a historical period where the department of public-health's rate of growth in general fund was high where our general fund support levels were growing at a rate that was faster than tractor-trailer rest of the city and so at last year's financial planning session, we kind of took the view of saying what would happen if we sort of

planned for ourselves to grow but grow no faster than the rate of growth as the general fund as a whole and so essentially we would be taking no more than our share of that growth in the tomb total city revenues and that was the principle to set some long-term financial planning targets for ourselves. the illustration is here where this is sort of saying if we start out with 30% of the numbered and hold ourselves and say we're going to grow but we're not going to grow more than our share we're not going to eat in to the share of other departments, at the end of the planning cycle, as it looks on the bottom, we're still at 30%. we grew but we're still at 30% of the discretionary general fund revenues.

the top is where we're growing faster than the general fund as a whole when we do that overtime we eat up a greater and greater share of the general fund dollars that are available and that leaves a smaller pool available for other general funded services and puts pressure on the general fund that ultimately comes back to us when they're a large deficits and we're asked to reduce our share of those deficits. so we're trying to say let's try to grow at the pace that the general fund dollars are growing that will prevent us from being in a deficit in the city it comes back as a large-cut targets and we're growing services, shrinking and growing and we're just going to keep at a slow and modest but steady rate of growth in our inflation. so last year this is kind of

recaping at what we looked at last year when we went through this exercise, we had used that principle and said, let's look at what the projections are for the rate of growth in the city's general fund and say if we grow no faster than that rate of growth so we just keep to our share what would our level of support would be to accomplish that and so at the top of the page for '17 and '18 those were our targets we calculate inside that way and $711 million and $740 million for '19 and '18 and below that is the adopted budget for the '17 and '18 you can see that there's the level of general fund support and it's 715 and 770 so it's over the target but that difference was funded because as you saw at the

presentation three or four months ago we ended fiscal year '16 and '17 with a large surplus due to revenue growth and those dollars were programmed in the mayor's budget to fund our d.h. r. contributions some of the items in the mayor's budget such as the humming bird, the saint mary's some of those other prioritys so our net general fund when you factor in the surplus is $682 million and $704 million over the two years so we're doing better than that target that was adopted by the health commission last year. that's a recap before we ended up compared to our discussions last year. so now -- what i'm going to show

you is we have updated this projection and i'm noticing the column might need to be widened. >> i see there's a little bit of a -- all right. so i'll do this and i'll scroll back and fourth and this is an updated version of what we looked at last year at financial planning session and this is essentially taking the mayor's financial forecast and isolating the d.p.h.-only portion of it and so you can see at the top there there are expenditures and those are broken out by the large catagories, salary and

fringe benefits and contracts and other items electronic health reports or materials and supplies, equipment, and facilities. on the bottom is our revenue projection again this is the revenue projection that is assumed in the mayor's five-year projection and general fund support and between our expenditures our revenue how much general fund support will we need to kind of and baseline projections and so to provide a little bit of context on what these are showing us, --

>> you can see where the growth is and where the changes are so for example, salaries and the line below that accounts for $250 million of expendsture growth so it's the single largest driver of our expenditure growth over the five -year projection. other items driving cost increases are inflation on our non personnel costs so our

contracts are purchases particularly our pharmaceuticals and our growing at a rate that's much faster than inflation and to all those if they continue at their rate of growth will drive up our expenditures and when you a five correction protection we projected if can he continue at this pace our general fund support will grow to $1 billion n. should read 22 and 23 fiscal year 22 and 23 so that would be a pretty significant rate of growth and this, what you are seeing here is mirrored in the larger and it shows the city deficit growing to $700 million by the end of the five-year time

line. what we're doing similar to the past if we look at five-year projection and say how do we expect the rate of those general fund revenues to grow, and then let's hold ourselves to that same rate of growth what would we have to do to get our general fund down to that level so i'll walk through this spread sheet and show you what that kind of projects out to and at the top line, those are the numbers taken from the last page so and in the next section we take the 18-20 budget so this is the upcoming two year budget and and

savings proposal so that target and our general fund targets and 19 and looking out in to the following three years, we're saying ok after that adjusted total after we kind of do what we're going to do in this two- year budget what will the years look like and in those areas what we're doing here is the same thing that we did last year we're looking at the rate of growth in the general f