pension actuaries taken that into account. it does increase costs. our pension system assumes 7.5% rate of return which they have recently knocked down to 7.4% rate of return, the pension return system board approved that decline in the discount rate in november. we'll see slight uptick in the rate to pay for that shortly. the return are volatile. in the current year to date, we're about 1.3. we consider that a short fall from our expected 7.5. we'll paying for that as well. just some other more obscure

depending on your level of familiarity with pension. supplemental costs which the city is in litigation over. this chart really is kind of folding together a lot of the factors that ms. kirkpatrick talked about. the bottom line here is the growth in c.p.i. of inflation. it's about 3% a year. it really depends. on top of it, the red line is showing the city's per f.t.e. cost of compensation. it's growing guy as fast as inflation. mainly because of pension and health. also underlying wage increases. it's folding together all the things that the employer pays for. significantly, it's much more than wage increases.

pension and health growing faster than inflation that really drives this. not necessarily unfamiliar to other jurisdictions. we've mentioned the city is negotiating with all the miscellaneous labor organizations. that's 28 agreements that will be effective on july 1st. that will depending on the outcome of the negotiations that could change our forecast. we've assumed as discussed just as a placeholder for planning purposes a number forecast c.p.i. for the bay area. any variance from that increase or decreases are projected in the shortfall. ms. kirkpatrick mentioned the forecast is assuming the recession.

it's pretty hard to time one. there's no forecaster that does it. we forecast continued economic growth and the reason we don't do it, we don't know the timing of it. we do want to be mindful just looking back at our economic history in the u.s. if we look back 75 years, expansions usually about 4.5 to 5 years long. we're coming up on 9.5. just being mindful of that. economic expansion will not last forever. with this far out so far, almost the longest expansion since world war ii. we wouldn't really expect to go without a slow down during the forecast period since we can't predict the timing, -- we can't predict timing of the slow down, we just project continued

growth. that said, there are few things that we're looking at that most folks are looking at to kind of get a sense what's coming. lot of discussion about interest rates. last year the fed increased benchmark rate four times. they kind of pulled back. less worried about inflation and more worried about continued economic growth on their part. folks are looking to the fed to see what they'll do for interest rates. we're looking at the yield curves. this is another common indicator for folks who look at. as you go out in time you'll earn more money on your investment. inverted yield curve is the things people are looking for. they want to see investors so

concerned, they're only willing to invest now. finally, there's a lot of we like everybody else, there's lot of uncertainty with federal trade policy and federal economic policy generally. we are looking at that. that's all you can really do. these four forecast that were issued by the mayor in december which i will let kelly discuss. >> two key themes that the mayor really highlighted for departments in mid-december when she gave instructions. two things that chair fewer mentioned earlier, first thing is accountability. making sure that departmentable budgets, ensure that every

dollar count. we need to demonstrate executive use in existing city funding. setting measurable metrics as well as achieving outcomes. we also wanted to make sure department had a eye to equitable outcomes. really prioritizing communities or groups with the greatest need. that included -- this is an example. obviously not limited to areas of unemployment, on house and homeless individuals, people lacking economic mobility, justice involved and lgbt. just couple of examples to help people think. for balancing to help balance the budget, the structural deficit that we noted, we look to departments to help provide us with ideas and proposals about reducing general fund

support. one thing, the deficit projections are just for the general fund which is $5.5 billion half of the city's $11 billion budget. this is 2% of general fund support growing to 4% in the second year of the budget. we do ask the department share with us what this service or operational impacts would be to taking no target proposals. we ask the cost magnitude around labor negotiations. the department provide proposal of an additional 1% to 2% reduction last year it was 2.5 to 5% total. if terms of fte staffing we asked to change to existing fte

first. we're in mid-march. we'll unpublishing the five-year plan. comptroller will be offering the 5-month report. labor agreements must be submitted to the board on may 15th. since june 1st falls on a saturday, we're planning to submit the budget to the board on friday may 31st. your hard work is really kicking into high gear in the month of june and july by which we must pass the budget. that's it for budget instructions. i'm happy to answer any questions or move on to state and federal updates. >> chair fewer: colleagues any questions? let's move on to state and federal. >> these are just couple of

high-level slides to talk about the state and federal budget time line and to highlight funding areas that impact the city most from the choices that are leaders and state federal government make. the governor submitted his proposed budget and my next slide will walk you through the highlights you see there. that is an opening proposal that gets debated amongst the senate and budget committees. they hold budget hearings in february through april. the governor puts out the may revise on may 15th. then through and june, the senate and the assembly pass revised budget and the governor signs on a time line to the mayor on july 31st for their fiscal year beginning on july 1st. the january governor proposed budget put out by governor newsom was $144 billion general

fund budget. the two key themes that we noted in reviewing that proposal is that similar to governor brown, there's a focus on paying down debt and maintaining state reserves. additionally there are many proposals for mostly onetime investments and one-time sources in the following areas. should the budget remain in similar shape that it did in january, would be cost relief to san francisco through the ihssf programming. we're anticipating 10 to $18 million. it is a component of. it will be a reduction but definitely not bringing down that large cost as it's

currently drafted. there's also changes to entitlement programs and med cal coverage in the governor's proposed budget. of course large funding for one had-time funding for housing and homelessness including focus on shelters, navigation centres and housing. thank you >> supervisor safai: supervisor mandelman has a question. >> supervisor mandelman: just slow it down little bit for me if you could. projected increase in ihss cost without the assistance are what? >> around $50 million this year growing to 60 to 100 by the firth year. >> supervisor mandelman: release that's proposed would take that down by -- >> by $10 million. >> supervisor mandelman: there will be 40? >> yes. we'll get the exact numbers. that's the order of magnitude.

it is helpful. i'm grateful that governor has made that a priority given the major cost shift to the city. it's not nearly the full impact that we're anticipating. >> supervisor safai: supervisor ronen. >> supervisor ronen: following that line of questioning, is there any additional efforts that are ongoing now to increase the amount? >> the mayor has made ihss one of the priorities. it is one city's top legislative priorities. for the organization of counties across the state, it is one of their top priorities. i don't know the status of current issues after the governor budget. it's an important issue. >> supervisor ronen: what's the best way to get additional investigation abou-- informatio?

>> i can check in with our state and federal liaison and the mayor's office to get the best information for you. when we come back in april with the march update which we do, we'll be outlined and it has more refined numbers. >> supervisor ronen: i'm stating the obvious, given the tsunami we were talking about and san francisco is not alone. it's more extreme here, but this is a statewide phenomenon. this does seem like something we shouldn't be sitting idle on and we should be pushing for greater release. you like to be part of that however we can and stay up to date ton that. also, the changes to entitlement expansion of med cal.

>> it's about number of people eligible for med cal. the high level that i know that would expand med cal funding for middle class and individuals regardless of immigration status, which is something that san francisco always stood behind with healthy san francisco. i think -- we can dive more deeply into it and working with their fewer to figure out where you like us to dive deeper for you. i'm happy to follow up and we

can come back with the department dive little deeper into some of these areas. >> supervisor ronen: i would love that it dive deeper. i love to understand that. finally, i guess really all three of these issues that increase funding, do we have a projection or idea impact to san francisco and how much revenue we can expect to the receive? >> i'll tell you what the high-level announcement was in january. they will have greater detail and specificity. the proposed budget is $750 million statewide. $500 million for production and $250 million for planning and technical assistance in short-term grants to local

governments in order to spur housing production. we're watching closely to see how develop in greater specificity to know what san francisco maybe eligible for. in terms of homelessness, they created incentives to regional collaboration and performance outcomes for homelessness by designated $300 million for onetime funding statewide regional plans. additional $200 million will go to jurisdictions that meet their shelter bed and supportive housing goals. more details to come out what will the goals be. we can provide updates to all yu all. saturday night live great, than-

>> supervisor ronen: great, thank you. >> chair fewer: supervisor mandelman. >> supervisor mandelman: just on the med cal piece, i don't know if this is what is included in the governor proposal. it would create a waiver to help pay used med cal dollars to pay for assisted living for folks. that quite significant in term being able to care for theme their homes and have a place for people coming out of drug treatment for example, place for them to go. that could be a pretty significant thing for us, i think. >> supervisor safai: thank you. >> as for the federal budget, i would say that my take away was from the federal budget is volatility and uncertainty. as we experienced with most

recent federal shutdown, it really sets up uncertainty for key programs. i wanted to highlight for you the major funding areas the city stephesteph -- received from the federal government. should another shutdown occur, would impact city revenue or entitlements that are distributed directly to residents. that is one biggest functions that the federal government supports in san francisco. fiscal year runs october 1 through september 30th. they passed about a dozen appropriation bills funding various departments. those bills should not pass, that is where we come into shutdown components that we experienced this past winter.

federal sourcers for the city, we receive about $1.3 billion in the city's budget related from federal sources that includes entitlement programs as well as medicaid, s.n.a.p., food stamp program and foster care services. funding to the city includes grants that we received from the federal government. we received significant funding through transportation grants as well as housing grants, hud homeless grants. we received $40 million through the department of homelessness and supportive housing. also, not necessarily in the budgets itself but supporting san francisco residents that

comes through the federal government to support individuals in their section 8 housing. i'll be happy to answer any questions. you know that was high-level. if you like anything else, i'm happy to hear them now or talk to you offline. ly pas -- pass for the discussif the six-month report. >> twice a year, we'll bring to you quarterly report known as the circumstance 6 month reporth report. these reports look at the year that we're in today.

the report we put out four week ago reduces our overall forecast deficit by just under $80 million. if we're looking at the two budget years, we mentioned deficit forecasted about $270 million. this will bring it down just under 200. most of the improvement is from property transfer tax. if we look at the receipts we have in the first halfth year, they are strong enough to increase our year end projections that we've taken that into account. that's about $100 million worth. in addition department of public health is seeing med cal reimbursement rates are higher than they had anticipated. as you know we have the city's

target for economic stabilization reserv reserves if the general fund revenue. the budget stabilization reserve, when the combined two reserves exceeded 10% of general fund revenue, our code prescribes the next bucket that we fill with that. which we are approaching. it's a budget stabilization, one-time reserves. i'll get into supplemental preparation this a moment. if you look at the right most column, this is the change, the 6-month report represents over prior projection. the prior projection being what was contained in the 5-year financial plan that was issued in january. we came up with the projections

in november. there was a bit of a lag. the most recent news is really all in real property transfer tax, better by little other $100 million. that's what we've seen year to date. it's very volatile. anywhere between $12 million to $57 million. they are just extremely volatile month to month. we do see growth in the first seven months of the year. that's really six months report in revenue. the growth in sales tax is just the delay the state department of tax administration implemented new software that didn't do allocation. we got allocation in the current year that was due last year. that's little bit of sales tax growth. if you look at the second column from the right, the variance from the budget, this includes

improvement that we took into account when we were preparing our 5-year forecast in november. the piece of information that you have at that point if time is where you ended the prior year. any news to the good or bad that you learned of at the end of the prior year becomes base building. we've talked little bit about voter approved spending

requirements. we're just displaying here the effective revenue growth on those different spending requirements. at the department level, the 6-h report, surplus is $36 million. it's almost entirely occurring at the department of public health and it is almost occurring entirely due to the med cal rates that i mentioned. other small amounts. really that's the biggest change that we see half way through the year. in terms of supplemental appropriations the board approved the budget and the budget is changed through the

supplemental appropriations. there's has been no ordinances that have been approved. we do anticipate shortly the mayor's office will be introducing a supplemental to reappropriate existing funding for overtime in the fire and sheriff's department emergency management. it's not a cost increase. it's just moving funding that's available that's been appropriated into overtime. that will be before you soon. this committee has also approved supplemental to provide short-term loans to federal workers that are affected shutdown. that will be available should be there another shutdown. as ms. kirkpatrick mentioneds, eraf supplemental i was approved after the issuance of this report.

some of the things that we have our eye on that would change these projections going forward. the city has not yet issued a audited financial statement for fiscal year 17-18. we're trying to bring that to a close this month to the extent that our auditors require us to restate anything this can change our numbers. we'll reflect that in the next report to you. i mentioned some of the revenue changes that the department of public health will be keeping our eye eye on that as well. lastly, the city received a number of payments from pg&e. some of them were general fund tax payments. they also pay property and bids business tax to the city as well as remittance for clean power.

we're currently assuming that those payments will be possibly delayed but not materially affected if the current fiscal we'll be coming to you shortly updates. the five-year financial plan will be updated this month in another week or so, i think it will be issued. comptroller's audited financial statement for th the city is the

cafr what we call it. i'm happy to answer any questions. >> president yee: on page 26, just back up little bit, these projections, for instance the business taxes, does this include any of the last year's ballot initiatives? >> no. those are special purpose taxes. when they are received they will be deposited into a special revenue fund. what we're showing you is existing general fund revenue. >> president yee: okay, that's good to know. >> chair fewer: supervisor mandelman. >> supervisor mandelman: can you talk about the projected shortfall in mental health revenue d.p.h.?

i have a guess. >> you might be better informed on it than i am. it's sort of multiyear trend that we've been experiencing. we're seeing six-month report, we tend to have a shortfall in the medi-cal program. overall, because other rates made up for that. >> supervisor mandelman: given the board's priorities around mental health and substance abuse, that will be an interesting thing to drill down on. i'm wondering if it is that we're providing mental healthcare that we cannot bill for and we're not doing in the appropriate way. people are stuck in mental health beds for too long. we can't bill. we are providing the healthcare. i don't think we're underproviding healthcare. we become unable to bill medi-cal for those services we're providing. we don't have the ability oprovide them in the appropriate

setting. >> we can bring that back for your next hearing on that topic. >> chair fewer: thank you very much. any other questions or comments? seeing none, let's open it up to the public. any members of the public that like to comment on items 1, 2 or 4? seeing none, public comment is closed. what i would like to do is to make a motion to file item number 4 and continue items 1 and 2. president yee. >> president yee: i want to talk about it, i got reminded during this presentation in regards to overtime. when we talk about the public safety piece, this is not an overtime there. has the police, fire department and the sheriff. i would like to have a report on that.

>> chair fewer: , okay we can request that. any other comments? seeing none i like to make a motion to continue items 1 and 2 and file item 4, may i have a second please? seconded. we can take that without objection. thank you very much. any other items before us today? >> there are no other items. >> chair fewer: we are adjourned. thank you. today.

>> (clapping.). >> i've been working in restaurants forever as a blood alcohol small business you have a lot of requests for donations if someone calls you and say we want to documents for our school or nonprofit i've been in a position with my previous employment i had to say no all

the time. >> my name is art the owner and chief at straw combinations of street food and festival food and carnival food i realize that people try to find this you don't want to wait 365 day if you make that brick-and-mortar it is really about making you feel special and feel like a kid again everything we've done to celebrate that. >> so nonprofit monday is a program that straw runs to make

sure that no matter is going on with our business giving back is treated just the is that you as paying any other bill in addition to the money we impose their cause to the greater bayview it is a great way for straw to sort of build communicated and to introduce people who might not normally get to be exposed to one nonprofit or another and i know that they do a different nonprofit every most of the year. >> people are mroent surprised the restaurant it giving back i see some people from the nonprofit why been part of nonprofit monday sort of give back to the program as well answer. >> inform people that be

regular aprons at straw they get imposed to 10 or 12 nonprofits. >> i love nonprofits great for a local restaurant to give back to community that's so wonderful i wish more restrictive places did that that is really cool. >> it is a 6 of nonprofit that is supporting adults with autism and down syndrome we i do not involved one the wonderful members reached out to straw and saw a headline about, about their nonprofit mondays and she applied for a grant back in january of 2016 and we were notified late in the spring we would be the recipient of straw if you have any questions, we'll be happy to answer thems in the month of genuine we were able to organize with straw for the monday and at the end of the month we were the recipient of 10 percent of precedes on

mondays the contribution from nonprofit monday from stray went into our post group if you have any questions, we'll be happy to answer theming fund with our arts coaching for chinese and classes and we have a really great vibrate arts program. >> we we say thank you to the customers like always but say 0 one more thing just so you know you've made a donation to x nonprofit which does why i think that is a very special thing. >> it is good to know the owner takes responsibility to know your money is going to good cause also. >> it is really nice to have a restaurant that is very community focused they do it all month long for

nonprofits not just one day all four mondays. >> we have a wall of thank you letters in the office it seems like you know we were able to gas up the 10 passenger minivan we were innovate expected to do. >> when those people working at the nonprofits their predictive and thank what straw is giving that in and of itself it making an impact with the nonprofit through the consumers that are coming here is just as important it is important for the grill cheese kitchen the more restrictive i learn about what is going on in the community more restrictive people are doing this stuff with 4 thousand restaurant in san francisco we're doing an average of $6,000

a year in donations and multiply that by one thousand that's a lot to hi, i'm lawrence. we ar doing a special series about staying safe. let's look at issues of water and sewer. we are here at the san francisco urban center on mission street in san francisco and i'm joined today by marrielen from puc and talk about water and sewer issues. what are things we should be concerned about water. >> you want to be prepared for that scenario and the recommendation is to have

stored 1 gallon per person per day that you are out of water. we recommend that you have at least 3-5 days for each person and also keep in consideration storage needs for your pets and think about the size of your pets and how much water they consume. >> the storage which is using tap water which you are going to encourage. >> right. of course at the puc we recommend that you store our wonderful delicious tap water. it's free. it comes out of the tap and you can store it in any plastic container, a clean plastic container for up to 6 months. so find a container, fill it with water and label it and rotate it out. i use it to water my garden. >> of course everyone has plastic bottles which we are not really promoting but it is a common way to store it. >> yes. it's an easy way to pick up bottles to store it. just make sure you check the

label. this one says june 2013. so convenient you have an end date on it. >> and there are other places where people have water stored in their houses. >> sure. if you have a water heater or access to the water heater to your house, you can drink that water and you can also drink the water that the in the tank of your toilet. ; not the bowl but in your tank. in any case if you are not totally sure about the age of your water or if you are not sure about it being totally clean, you can treat your water at home. there is two ways that you can treat your water at home and one is to use basic household bleach. the recommendation is 8 drops of bleach for ever gallon of

water. you add 8 drops of bleach into the water and it needs to sit for 30 minutes. the other option is to boil water. you need to boil water for 5-10 minutes. after an earthquake that may not be an option as gas maybe turned off and we may not have power. the other thing is that puc will provide information as quickly as possible about recommendations about whether the water is okay to drink or need to treat it. we have a number of twice get information from the puc through twitter and facebook and our website sf water.org. >> people should not drink water from pools or spas. but they could use it to flush their toilets if their source are not broken. let's look at those issues.

>> sanitation is another issue and something people don't usually or like to think about it but it's the reality. very likely that without water you can't flush and the sewer system can be impeded or affected during an earthquake. you need to think about sanitation. the options are simple. we recommend a set up if you are able to stay in your building or house to make sure that you have heavy duty trash bags available. you can set this up within your existing toilet bowl and once it's used. you take a little bit of our bleach. we talked about it earlier from the water. you seal the bag completely. you make sure you mark the bag as human waste and set it aside and wait for instruction about how to dispose of it. be very

aware of cleanliness and make sure you have wipes so folks are able to wash up when dealing with the sanitation issue. >> thank you so much, >> a way of life in san francisco. when the next major quake hits, the city hopes a new law requiring seismic upgrades to five story buildings will help keep more residents safe and sound. tell me a little about the soft story program. what is it? >> it's a program the mayor signed into law about a year and a half ago and the whole idea behind it was to help homeowners strengthen buildings so that they would not collapse. >> did you the soft story

program apply to all buildings or building that were built in a certain time frame? >> it only applies to buildings built in the time frame of 1978 and earlier. it's aimed at wood framed buildings that are three or more stories and five or more units. but the openings at the garage level and the street level aren't supported in many buildings. and without the support during a major earthquake, they are expected to pancake and flatten ~. many of the buildings in this program are under rent control so it's to everybody's advantage to do the work and make sure they protect their investment and their tenant. >> notices have gone out to more than 6,000 owners of potentially at-risk properties but fewer than one-third have responded and thousands might miss an important deadline in september to tell the city what they plan to do.

let's talk worst case scenario. what happens in a collapse? >> buildings have the tendency of rolling over. the first soft story walls lean over and the building collapse. in an earthquake the building is a total loss. >> can you describe what kind of strengthening is involved in the retrofit? >> one of the basic concepts, you want to think of this building kind of like rubber band and the upper three floor are very rigid box and the garage is a very flexible element. in an earthquake the garage will have a tendency to rollover. you have to rubber band analogy that the first floor is a very tough but flexible rubber band such that you never drive force he to the upper floors. where all your damage goes into controlled element like plywood or steel frame. >> so, here we are actually inside of a soft story building. can we talk a little about what kinds of repairs property

owners might expect? >> it's a very simple process. we deliberately tried to keep it that way. so, what's involved is plywood, which when you install it and make a wall as we have done here already, then you cover it with this gypsum material. this adds some flexibility so that during the earthquake you'll get movement but not collapse. and that gets strengthened even more when we go over to the steel frame to support the upper floor. >> so, potentially the wood and the steel -- it sounds like a fairly straightforward process takes your odds of collapse from one in 4 to one in 30? >> that's exactly right. that's why we're hoping that people will move quickly and make this happen. >> great. let's take a look. so, let's talk steel frames. tell me what we have going on

here. >> well, we have a steel frame here. there are two of these and they go up to the lower floor and there is a beam that go across, basically a box that is much stiffer and stronger. ~ goes so that during the earthquake the upper floor will not collapse down on this story. it can be done in about two weeks' time. voila, you're done. easy. >> for more information on how to get your building earthquake ready, >> my s.f. dove -- government t.v. moment was when i received a commendation award from supervisor chris daly. then we sang a duet in the board chamber. [singing]

>> happy anniversary san francisco government t.v. happy anniversary to you. happy anniversary san francisco government t.v. anniversary, anniversary, happy 25th anniversary to you. [♪]

for the record, this is the fen 19th, 2019 treasure island development authority infrastructure and transportation committee meeting. item number 1, call to order and roll call. director richardson. >> here. >> director sein? >> here. >> director? we have a quorum. item number 2, general public comment. allow members of the public to address matters within the subject matter jurisdiction of the committee. and does not appear on today's agenda. in addition to general public comment, public comment will be held during each item on the agenda. members of the public may the committee for up to three minutes. please state your name and the organization if you're he want -- representing.

i