total payments would be $6.6 million and we recommend approval. >> thank you. let's open this up for public comment. anyone like to comment on item number 5? seeing none, public comment is closed. i would like to move this to the board with a positive recommendation and i can take that without objection. thank you very much. >> madam clerk, item number 6. >> a resolution approving the first amendment to the grant agreement between the city and children's services with a provision of early care and education integrated services to support the city's implementation city-wide plan for early care and education to increase the amount by 9 9.9 million for total term of july 1, 2017 to july 30 of 2020. >> i'm the senior analyst for care and education. we're asking the board of supervisor's approval to modify the existing grant grant with

the children services for july 1, 2019 through june 30, 2020. we're requesting an additional 8,000,292 and for a new grant of 34,000,965. this is to ensure the continuation of early care and education services city-wide. they're a vital partner in our early care system. they mainly provide subsidy administration to ensure the young children are access to high-quality, early care and education services. the original budget was developed as the 2016 city-wide resign of the san francisco's early care and financing system. various system and funding refinements including subsidized rate increases, discretionary

funding awards, reallocation and costs of doing business have all contributed to the need of funding modification. this funding will ensure it will provide uninterrupted services to the existing families and children currently case managed. they were selected through a competitive process, rfp744. thank you for your time and happy to answer any questions. i'i have my colleagues here to answer any questions. >> the b l.athe bla report, ple. >> this was for 2017 through 2020. the board is being asked if there was an increase in the contract but doesn't change the term of the contract but will end in 2020. the increased amount is 9.$9 million from 32 million to 42 million. i believe there's increased

spending on the original term. it was $10 billion a year and we do actually, based on a calculation of the contingency recommend a reduction in the request of contract not to exceed 2.5 million from 42 million to 39.5 million and also to delete the ter terminoly in the resolution saying this is retroactive and otherwise recommending approval. >> thank you. lead open this up for public comment and any members that would like to comment on item number 6? seeing none, public comment is closed. i make a motion to approve the amendments proposed by the budget legislative analyst. you can take that without objection and make a motion to move this to the full board as amended and we can take that without objection. thank you very much. madam clerk, any other items before us today? >> no other items.

>> thank you very much. this meeting is adjourned.

>> hi, everybody. welcome to laguna honda. [cheering] >> and before we get started, my grandmother spent almost 14 years here at laguna honda, and so many of you took incredible care of miss camelia brown. i want to give a special shout out to denise and so many people here who day in and day out take care of some of our most vulnerable folks that rely on us to care for them every day. we are so grateful to be here with our governor, gavin newsom. [cheers and applause] >> he has already hit the ground running, and we know from experience of being a former

mayor of san francisco, he understands intimately all the challenges that we as a city face, which really is going to be so incredible for our city and cities across the state of california for all the things we know we need to do to change california for the better. laguna honda is a key part of san francisco's health network, which cares for one in eight san franciscans. primarily people who are uninsured, low income, or for -- from our immigrant communities. and includes not only laguna honda, but san francisco general , and smaller clinics across our city, and health services in our county jail. here at laguna honda, more than 1,000 patients each year receive care for complex conditions like h.i.v. and alzheimer's and dementia, and other mental illnesses and disorders, and we

have, for patients who are suffering from strokes or brain injuries, or spinal injuries, or other trauma. these treatments require long-term and specialized care, as so many of you here know, and they commonly include medications as part of the treatment plan. however, it is a well-known fact that these medications are expensive, and can drive up the cost of healthcare for millions of people who need these drugs to survive. the san francisco health network is constantly working to find ways to save money on drug costs for uninsured patients. we work with federal programs like the 340 b. program that provides drugs at a discounted rate for some of our facilities, but facilities like laguna honda , or our county jail, our behavioral health clinic, they don't qualify for those federal discounts.

not to mention the medications used in treatment plans at these facilities are some of the most expensive medications. the health network purchases more than 3,000 drugs for patients who don't qualify for 340 b. discounts, and just the 25 most expensive drugs, of those costs, it because our city more than $17 million each year. when we have people struggling on the streets of san francisco, with mental health challenges and substance use disorders, or people spending thousands of dollars on life-saving medication for h.i.v. and aids, or people fighting a battle with cancer, we need to be focused on helping them recover and heal, not whether or not they can afford to pay for the medication

this is the same case at many healthcare facilities, not only in san francisco, but across the entire state of california and the nation, and this is why i am so thrilled to be joining governor gavin newsom here today to announce a san francisco will be joining the efforts to bring down medication costs in our city. [applause] >> we will work hard to bring down the cost of those medications. we have worked hard over the years, but we know there is so much more that we can do, and by joining forces with other counties across the state, we know that we can make a difference in the lives of millions of patients. we are joined here today by two other bay area counties in making this commitment, alameda and santa clara county, and please join me in acknowledging

our new department of public health director, dr. grant koufax who is here with us today [applause] >> at this time, i would like to call to the podium colleen who has spent about 13 years working for the department of public health in san francisco. she is an incredible health care advocate, now heading up alameda county department of public health. [applause] >> good morning, everyone. it makes me so happy to see so many familiar faces here, and to be able to bring my new county in partnership with my old city and county in this really exciting endeavor. alameda county is pleased to stand with governor newsom to leverage the collective garb -- bargaining power as a state in its counties to lower the cost of prescription drugs for all californians. i would like to thank the governor for his leadership on

this important issue. alameda county's vision 2026 is in alignment with the health forward agenda. vision 2026 is our comprehensive effort to set a course for a decade that anticipates community challenges and maximizes our ability to meet residents's needs in this rapidly changing world. vision 2026 foresees a thriving and resilient population where individuals and communities are empowered to overcome adversity and be supported so they can grow, flourish and be self-sufficient. essential to achieving this vision is our ten goal of healthcare for all, which seeks to ensure that every person in alameda county has access to the care and services they need to live their healthiest lives. governor newsom's collaborative approach to obtaining prescription drug costs will put us closer to a comprehensive

solution for affordable and accessible healthcare for all. collectively, public healthcare providers and other safety net providers in alameda county, spends tens of millions of dollars each year on prescription drugs for our county's most vulnerable residents. while many of these drugs are acquired through the federal 343 b. program which may or breed referenced, drugs purchased for individuals accessing our behavioral health services or our inmates and our jails do not this means that we are surely paying more than we need to for these medications, diverting valuable resources from other safety net programs and services this presents an important opportunity for our county and others to partner with the governor's healthcare team to explore how we can make drugs more affordable in our safety net healthcare system. additionally, this approach will foster regional collaboration through the sharing of information and protocols and best practices. alameda county is looking forward to partnering with the

governor's office, and our county colleagues to explore the promise of this timely endeavor. at this point, i would like to welcome miguel marques, marquez, the chief operating officer for the county of santa clara. [applause] >> thank you, colleen, and thank you governor newsom for inviting slight -- santa clara county to participate in this event and in this work, and thank you mayor breed for hosting this event today. over the years, santa clara county has implement it programs to expand coverage and affordable options that move us closer to providing healthcare for all. indeed, our board of supervisors has officially supported a single payer healthcare system. and santa clara county, we are proud to operate three hospitals , and a dozen clinics located throughout the county. each of which provides high-quality, integrated healthcare to the 2 million members of our community. like the governor, we know that

innovation through the healthcare system, including a path to single payer systems will help us reach our shared vision of better health for all. that is why we are excited by the opportunity to work with the governor and with so many other partners throughout the state to take on the high cost of prescription drugs. year after year, pharmaceutical companies continue to increase the price of brand-name drugs. we all need to ask the question, do prescription drugs really have to be that expensive? wild drug purchasing practices are complex, we must look for and implement innovative solutions to reduce these costs. federal policies have not done enough to control drug prices. in the absence of federal leadership, local and state government need to partner and need to think creatively about how to leverage our collective buying power to negotiate better

prices for our residents. last year, santa clara county valley medical center spent more than $120 million on pharmaceuticals. giving the extrude nearly high cost of prescription drugs, we have been looking for opportunities for savings. we welcome the chance to work with the state and with other partners to explore options to reduce these costs. as you know, public helps it -- health systems play an especially important and unique role in delivering care, services, and treatment to the patient's in the communities we serve, especially the uninsured and the underinsured. we are a safety net healthcare system that is proud to offer top-notch care to all who need it, but to do that, we need to explore all opportunities to reduce costs whenever possible so that our limited resources can better be spent to help the homeless, the mentally ill, and other vulnerable members of our community.

a number of years ago, the county of santa clara was the first county in the nation to ensure that every child, regardless of immigration status , could get healthcare services. we are especially proud to support the governor's efforts to become the first state in the country to provide coverage to young, undocumented adults. thank you, governor for leading the way for these young adults. santa clara county and the state of california have aggressively implemented the affordable care act. it has been a huge success. just a couple of numbers. in santa clara county alone, more than 100,000 -- 140,000 residents gained coverage through this expansion. another 45,000 plus have subsidized coverage through coverage california, that is just in santa clara county. and most important, the bottom line number, the uninsured rate

in santa clara county has dropped by 50 3%. so the time is now to take the next step. we are fortunate to have a governor who is a champion for these important issues. we look forward to working with the governor to make better health for all, california's highest priority. thank you very much. [applause] >> thank you, miguel. i also would like to take this opportunity to introduce someone who has been a champion for laguna honda, our supervisor for district two, catherine stefani is joining us here today. thank you so much. [applause] >> and now i would like to introduce our governor, who we all know was a former mayor of san francisco, someone who led innovative programs, pushed to really change san francisco and california for the better, same-sex marriage, he was the one who put forth the idea and

opened the doors for so many people to get married at city hall, when so many people attacked them on this issue, and now it is gone global and has been recognized throughout the united states, 311 was just his brainchild, this innovative resource that we use to call to deal with a number of challenges in the city, so many incredible resources that we use today, and now, is a governor in his budget , he will continue to provide the support and the resources that we need to address many of the challenges that exist in san francisco. we also should know that he really led the charge on the rebuild on the hospital to the new facility that we see today. the governor of the state of california, gavin newsom. [applause]

>> thank you, thank you. this is fun coming back. the couple of you were showing me photos ten years ago, pregrey hair, and this is remarkable that this place opened. i remember standing here during the ribbon-cutting, and i think i used a line, which i am now reminded of, at the time we were doing something with a skilled nursing facility. also ten years ago, that was novel and no one was investing in this place. people so the county couldn't afford it and we had to move in a different direction. we get it when it comes to skilled nursing facilities and keeping people in place. we are on the leading and cutting edge and doing something no one else is willing to do. i remember saying that the mayor of athens said, he says, we do not imitate, for we are a model to others. i say that then, nine plus years

ago, i will say it again today in the context in the spirit that brings us here together around the issue of prescription drugs. we do not imitate because we are a model to others what we are advancing here today is new, what we are advancing here today matters what we're doing today is what i expect others to be doing tomorrow, not just other counties joining california's purchasing pole, but other states joining california's purchasing pool. leveraging our resources, big buyers mean lower costs. the fact is, in the state of california, 13 plus billion dollars a year, your tax dollars are currently being spent on prescription drugs. i will repeat that, 13 plus billion dollars a year.

the problem is, we were isolating the purchasing. we had jails doing their purchasing, we had the state hospitals doing their purchasing , we had our retirement system doing their purchasing, we had the va doing their purchasing, we had our medi-cal system, which is 13 million strong, we were only leveraging 2 million of those 13 million in our purchasing pool. just combining the medi-cal system alone, taking the 2 billion and leveraging the purchasing now with 13 billion is going to drive hundreds of millions of dollars of savings on an annual basis. we project in our budget that we just submitted a few weeks back, or a week or so ago, that we will save conservatively $393 million because of this purchasing effort. that's just on an annual basis, $400 million of money that we

otherwise would spend that would allow us to provide discounts, to provide additional subsidies to reduce those costs each to each and every one of you. if we are not curious about these drugs, we are not curious about addressing the cost as it relates to the issue of healthcare inflation. this is one of the principal drivers. we have seen close to doubling of our costs in the state, doubling of our cost in the state, just in the last nine years. this cannot continue. with all due respect to big pharma, i have no problem, no gripe with people being successful, i don't begrudge success, i appreciate competition, i appreciate research, i appreciate the kind of innovation that we pride ourselves on, but i don't like people taking advantage of other people. i don't like gouging, i don't like windfalls, i don't like folks, you know, getting massive

bonuses and, you know, at the expense of folks that are struggling on the streets and the sidewalks. this is a foundational principle , it is a value i know laguna honda community shares. it is a value that san franciscans share, it is of value the mayor shares, it is shared broadly throughout this state and substantial of lee, around this region in santa clara, in alameda, that value now is being brought to the forward in terms of counties joining the state purchasing pool. we had hoped this would happen in a year or two, maybe three, but here we are, just weeks after announcing l.a. county joining our purchasing pool, no three additional counties are joining the purchasing pool. this is remarkable. the momentum is real, and this is exciting because we are actually making progress in realtime. this is not just platitudes, this is not just a tweet, this

is not just a promotion, it is not just a promise, we are seeing things happen in realtime , so i just want to thank the enlightened leadership that you heard from today. they didn't need to do this, it was wise to do it, but they didn't need to do it, but the fact that they are doing it, and they are doing it on the front end, is an extraordinary testament to mayor breed's commitment not passing interest to bring down the cost of prescription drugs and the cost of healthcare in this county. colleen's commitment and miguel 's commitment to do the same is a big deal, so i don't want to undersell this moment. i want to appropriately sell it. i want to overhyped -- i don't want to overhyped it, but this is significant. we have governors calling this state wanting to join our efforts. we believe this is the beginning of a different frame of momentum not top-down, god bless watching

congress, pretzels trying to deal with big pharma, this is bottom up. it is a new frame. i will tell you, a california, we just reached at $3 trillion year mar. we punch above our rate, and there are only four nations on planet earth that carry more wait then the state of california. we are truly a nationstate, the fifth largest economy in the world, the united states is one of those economies ahead of us, only a few others that have the capacity to do what we are doing as a state. now the second largest purchaser outside the v.a. and the united states itself in the country. this is important. i want to express and acknowledge the hard work of our team in sacramento that is working overtime to get this right, to make sure we do it right. i want to thank the counties for building that momentum, and i want you all to know that we are inviting the private sector to

join our purchasing pools. we want to see companies large and small also join in and take advantage of our ability to leverage and to sit at that table as one purchaser, not just aggregated as thousands of purchasers. we are formed -- where pharma has the power, now we are taking back that power and we are leveraging that power over the table. hugh merrow costs 96% more in the united states than it does in the u.k. some medications are 100% more then the folks in the u.k. give me a break. with all due respect, it is not just about well, we do the research on the development, we have to pay for that, the people who do the most research and the development are people like you. through our grants, through our tax dollars. they leverage those, they supplement those, and we are proud of that research. but give me a break. they do it because they can.

they do it because no one is pushing back. they do it because they leverage influence of the people like me. they come in with a lot of money and they come into leverage their point of view and they usually scare folks instead of doing the right thing, but they can't scare the leaders assembled behind me, and the cannot change the trajectory of a state that says, we have had enough. we are better than this. we will do more and we are going to leverage our voice in a way that respects the people of this state that we represent, so thank you all for coming out. thank you for being part of this announcement and all this extraordinary momentum and know this, in closing, this is just one of many things the state of california is doing to expand healthcare in this state. our budget, briefly, is going to expand coverage regardless of your immigration status. our budget will double substantially and increase by doubling our annual contribution

and our medi-cal system through proposition 56. forgive me for boring you on that, but we will increase our reimbursement rates, more trauma screenings, more early screenings to address issues before they manifest, we are going to deepen subsidies for low income families on the health exchange, and expand subsidies into the middle class. the only state in america that is expanding subsidies for families earning up to $150,000 a year. we are very proud of these efforts. our goal is universal. our goal is to get this done through a single parent financing system, but until we advance those ideals, we will build pragmatic steps, make progress each and every week until we ultimately get to those goals. thank you, san francisco, thank you to mother nature for adding a little energy, thank you mayor

breed for hosting us here today. [applause]. >> thank you. >> i don't know if there are questions, how do you want to do this? i will let the electives go, and supervisor, very wonderful you are here as well. any questions, we will do it out here. we will let you all go. thank you, guys, very much. [applause] >>

>> my name is sofy constantineo and a documentary film maker and cinema togfer, producer and director. it is inevable you want your movie to get out and realize yoi need to be a commune tee organizer to get people together to see the story you will tell [inaudible] pretty rich and interesting. in what we do as film makers is try to tell the best story possible so i think that is where i [inaudible] learn everything. lighting and cinematography. i got jobs of stage manger at some place and projectionist. i kind of mixed and matched as i went and kept

refining i feel like it isn't just about making things that are beautiful and appealing and rich and [inaudible] the way that the films [inaudible] it has to tell a story. >> my name is sumell [inaudible] free lance multimedia produce. my project is [inaudible] mostly oof street photographry with a few portraits. i'm going arounds san francisco and capturing the [inaudible] as we started to do this project i was reading about the decline of african american population in san francisco and i wondered where the remaining population was and what they were doing and how life was for them. >> i wasn't very inspired by school, i wasn't very inspired by continuing to read and write and go to class.

i watched a lot of movies and saw a lot of [inaudible] i said that is what i want to do. i had this very feminist [inaudible] and i felt like there was not enough of a womans vision on the stuff that we see, the movies that we make and the beginning of the [inaudible] the way we look at women and the roles women take in the stories being tolds. they felt [inaudible] they did want feel complex. i was like, i have a different frame i like to see the world shaped by. >> my grandsmother was a teacher and taught special education for 40 years in los angeles and when i was growing up she inspired me to record

everything. we recorded our conversations, we recorded the [inaudible] we recorded everything to cassette players. learning multimedia skills, from the other crossover employment opportunities for young people. someone who grew up in la rks san francisco feels like a small town. i lived in western addition and i was looking for someone to cut my hair, i found [inaudible] he seemed like a very interesting guy and grew up in the neighborhood and had a lot to say about something that was foreign to me. that local perspective and so important to me because i think as someone who isn't from here, knowing that history allows me to be more engaging in the community i live in and want the same for others. i want people to move into a new neighborhood to know who was

there before and businesses and what cultural and [inaudible] shape what we see today. >> my guiding principles have been, if you stick to something long enough and know what it is and go for it you will get there. [inaudible] where i want to go, what i want to do and it is totally possible so, the impossible is you know, is not something to listen to.

>> afternoon, everyone. the meeting will come to order. this is a may 22nd, 2019 regular meeting of the budget and finance committee. i am joined by supervisors catherine stefani, rafael mandelman, norman yee, and hillary ronen. i would like to thank san francisco government t.v. for broadcasting this meeting. are there any announcements? >> silence all cell phones and

electronic devices. completed skid beaker cards and copies of any documents to be included should be submitted to the clerk. items acted upon today will appear on the june 4th, board of supervisors agenda unless otherwise stated. >> thank you. can you please call item number 1? >> hearing on the 2018, 2019 nine-month budget status report and requesting the controller to report. >> thank you very much. here we have mr. controller here to present for us. >> our director of budget analysis, we welcome to the nine-month report today. >> thank you very much. >> good afternoon, committee members. i have a few slides to walk you through our most recent projections. you should have a copy at your desk. our report is projecting an

improvement in the current year ending balance of just over $55 million from our prior protect -- projection. this brings the shortfall that we projected in our fire forecast down to $100 million and i would say the improvement is due to a small handful of things, largely patient revenue at san francisco regional hospital to talk about and improve revenue and expenditure savings in the human services agency, more than offsetting some of the clients in property tax revenue that we are seeing overall. we are projecting that we will meet in the current year our target of 10% of general fund revenue and our rainy day budget stabilization reserve. to the extent that we actually hit or exceed that target, any additional revenue would flow into a one-time reserve that

would be available for one-time purposes. just to look high-level at our tax revenues, these are revenues that aren't generated by a specific operating agency. i mentioned we have a slightly higher level of property tax refunds, and a slightly lower level of prior-year supplemental revenue in the current year than we had projected at the last point in time. still, overall revenue, if you look at the bottom line versus our budget, very strong $250 million with a slight decline for the lost time. we projected revenues for you. the change i think it's all in property tax revenue. there is a slight notch up in sales tax revenue and a lot of that is really prior year revenue that we are recognizing

in the current year. the state agency that collects these revenues implemented in the tax system. they couldn't allocate revenues from some of the biggest permit holders until around december. we are getting that revenue now. you will see that flow through in some of the sales tax revenue that we get from the state, and it comes to the human services agency and d.p.h. as well. it is listing all of our sales tax. as you know, voters have approved allocations of our discretionary revenue for specific purposes. the net increase compared to budget, because our discretionary revenue is increasing overall, it is about a 31 million-dollar increase to these requirements that we will be making. i would like to make a note that you will see there is no additional increases to children 's baseline or the transitional eighties -- age use

baseline because the supplemental appropriation of the excess revenue that you approved in march, the uses that were appropriated in there, many of them are eligible to be counted towards these baselines, and so now the budget exceeds the required level of funding for those. that is why we are not rejecting additional spending needed beyond what you have already appropriated. i should say that this is our last projection of revenue for the current year. we are finalizing projections for the proposed budget that will be coming to you very shortly. you will see in there, some slight changes that we have made on our side to the business tax and transfer tax, moderate growth in both of those, it on

the business tax side, really refracting -- reflecting i.p.o.s that have happened in this city. revenue generated from that will be expected over the next two years as well as faster than expected job growth. the federal bureau of labor statistics recast some of the employment data that they had earlier published and the growth rate was higher than we had rejected before. on the department side, you'll see that the good news in the departments is more than offsetting some of the weaknesses that we were seeing in the property tax at a citywide level, and it is really in the department and public health and human services for each of those. it is marginally the state sales tax, the 1991 realignment which is sales tax revenue that comes to those operating departments. a little piece of it is that,

but the big story is in public health, and within public health , it is largely san francisco general hospital. the higher than anticipated census, which has been an issue that we had last year and this year as well. more patients at the hospital than were anticipated in the budget, as well as more payments under the maddock -- medi-cal waiver. they are pay for performance kind of programs where it is the hospital meets the performance targets in terms of preventive care and patient outcomes and patient satisfaction that may become eligible to receive money from the school. the hospital has just been better on the metrics than they anticipated they would, and they were able to drive more of that revenue. that is what is really driving the revenue increase in public

health, which is really the other, the biggest news that we have in this report. human services, there are expenditure statements. a lot of it is caseloads being lower than they anticipated, under spending on contracts, and a couple of other things, and just the third item i would note is the war memorial. this is an unusual surplus for them. they have sold transferable development rights to a product developer that means that they have the rights to develop higher than they actually are going to build, and they can fill the rights to develop. it happens a lot in the private sector for the past couple of decades. it is rare for the government to be selling because we don't have many opportunities to do it, but this is one of our opportunities in the war memorial is selling those. that is generating $8 million then in the current year. that is a pretty volatile

revenue. it is hard to predict because it is hard -- the timing of any kind of deal, and the value, the market value is hard to know much in advance. this is revenue that we have actually realized, so we are working now. i would make a couple of other -- >> where did it go? >> who bought them? i don't know. we can find out. just a couple of highlights to make on this slide here, as you know, the board has board has approved several large general funds supplementals this year. the annual overtime supplemental is the first one. also, loan to federal employees

that are affected by it shut down, should one occur, and most importantly, the appropriation of unbudgeted property tax revenue that the city is getting in the form of access, for a number of purposes. those are all reflected in part of the revised budget now. we are projecting reserve deposits to increase by $9 million, that is mostly in our rainy day reserves, which get spread between the city's economic stabilization reserve, the school's economic stabilization reserve, and a one-time city reserve, so combined among those three, about a 9 million-dollar increase, and one final point that i will make is on 16, 17, -- in the current year we are recognizing the extra property tax revenue that was earned in fiscal years 18 and 19, we also submitted revised reports to the state so we could kind of get

our foot in the door. if we think we are owed for 16 and 17, -- we don't get notification did -- they notify is the amount they will allocate so that is when we will know for sure, the last week of june. that is when they are stating what they will allocate to the school district, that we can therefore take back, but the governors may revise -- they actually called out and expense on the stateside, of $149 million for 16, 17 eraf sources for san francisco. that does make it seem certain that by the end of the june -- end of june, it is quite likely that we can expect that we will be able to receive that revenue, at the very most, the last week of the fiscal year. a lot of that would be dedicated to reserve deposits under our

formulas. about $60 million would be available in that reserve and baseline allocation. that is all i have prepared, but i would be happy to answer questions. >> colleagues? any questions or comments? yes, supervisor model men? >> i think it is worth noting -- they have brought his good news around the budget and i know this has not always been the case, that d.b.h., in years past , has actually been a drain in many years, and i think it is certainly a priority for the power director, and for the current director, as well to get a handle on rumour -- reimbursements, and medi-cal, and all sorts of issues related to their budget.

that seems to be bearing fruit here, so i personally am grateful for that. i want to express gratitude to the folks at d.b.h. who have made this happen. >> any other comments or questions? i would just like to say that i think this is very good news and that it looks like our deficit is now down to 100 million, which is, after these years of working with advocates and other organizations, we are always monitoring the deficit. this is actually -- i know 100 million sounds like a lot of people, but in terms of a city budget, it is very, very, very good news. i think our economy is strong, and i think -- i want to thank the office for doing such a diligent job, and i think this is really good news as we go into the fiscal year and the following fiscal year, too.

any other comments or questions? let's open this up for public comment. are there any members of the public would like to comment on item number 1? mr. wright? >> if you remember, just last friday at the board meeting, i demonstrated that the analysis represented -- representative of the employees calculated nearly 649 million dollars would be in debt with the spending and the way that you take care of business, if you continue doing what you are doing. i just saw in the newspaper, s.f. viewer, that all you supervisors just got a 12% salary increase, and supervisor

and allows for comparison and contrast, and you got bigger increases then the other counties, as far as the board of supervisors is concerned. the person that is in charge of that commission, who granted this salary increase says that the supervisors should be in a position to get the salary increase in order to keep up with the cost of living, and they deserve this income increase, but yet, when it comes to the low income bracket people , the people who are homeless on the street, who are not having their incomes increased because they have a stable, permanent income that doesn't get increased, and retired people, or senior citizens who are on fixed income , you use a different type of philosophy. that is in another example of differential treatment, and constitutional laws being violated pertaining to do process and equal protection under the law.

if you are focusing in on income increases in order for the board of supervisors to live here, you should be doing the same type of philosophy to the people who were born and raised in san francisco, and these are the very people who you claim that you want to help, when you are campaigning for people to get the position that you are in. and then again, you are turning your back on them -- >> thank you, mr. wright. >> i was going to say your salaries might be tied to tax production, it sounds as if they are, however that is not incompatible with the public accountability. what i wanted to discuss is san francisco is using 70 million gallons -- gallons of water and 24 hours. if we lose 7 million gallons over the same period -- period, and if waters presently sold at 7 cents per gallon, then we may

be losing seventh hundred and $90,000 slipping through the cracks every day. it would cost the equivalent amount on a daily basis to replace 1,000 linear feet of pipes sustained over four and a half year period in order to divest ourselves of the 20% of pipe representing 240 miles, which has been most impacted by corrosion for an annual total cost of $186 million, and that would be a total cost of $840 million. you might want a walkable ground penetrating radar in the process to safely achieve that pace. it is a matter of best practices and public safety. if instead you choose to issue a 30 year bond to seismically upgrade the fire station, at a cost of $540 million, for example, will it benefit the firefighters if they lack sufficient water resources? during the 2006 earthquake, all

of the water mains broke and they fought fires with their axes. i believe the public can afford a special assessment paid over seven years so that that does not -- that service does not drain public finances. i selflessly ask the retiring head of the fire department to fill one of two vacant seats on the san francisco water board, whether she obliges or not is anyone's guess, last year, a group of seismic specialists ran a monte carlo simulation -- >> thank you, very much. any other public comment? seeing none, public comment is closed. thank you. i make a motion to file this item. could i have a second, please? thank you very much. i take that without objection. thank you, thank you very much. please call item two. >> item two is an ordinance

amending the administrative code to establish the affordable housing production and preservation fund receive appropriated excess education revenue all been -- augmentation funds for the purpose of funding and acquisition, and production of new 100% affordable housing and acquisition and preservation of existing housing to make that housing permanently available -- i'm sorry, affordable. >> thank you very much. colleagues, today i am proud to inform this legislation to crate and affordable housing production and preservation fund from ongoing access eraf funds that the city receives from the state. san francisco is on track to exceed our goals from market rate housing. we are now falling well short of our goals for very low, low, and moderate income housing. as of last year, the city has already produced 96% of the market rate units needed to meet goals for above moderate income housing by the year 2022. however, we have only produced

30 1% affordable units needed to meet our 2022 goals for very low , low, and moderate income housing. in 2014, voters passed prop k., with the goal in of ensuring that 32% of new units in san francisco are affordable. according to the housing balance report, only 25% of new units produce -- produced in the last ten years have been affordable. the housing production show us falling even further from our goal with only 22% of new units projected to be affordable. to make matters worse, for every 12 to units of affordable housing, the city created -- we lost more than one unit of existing housing to ellis act evictions or demolitions, or condo conversions. when you factor in this loss, less than 18% of net units produced in the last ten years have been affordable. this data illustrates why it is so critical that the city invests more in production and preservation of affordable

housing or to increase affordable housing stock so we no longer are taking two steps forward and one step back. if we are serious about meeting our housing balance goals and addressing our affordability crisis, we cannot continue to rely on market rate developer fees to fund our affordable housing. let's begin by putting 50%, or future eraf funds towards a production and preservation of affordable housing so our ability to continue adding to affordable housing stock is not tied to the volatility of the market. i'm excited about the prospect of the voters passing a 500 million-dollar housing bond, but with only $30 million being dedicated for preservation, we need to substantially grow the pie. this legislation gives us the opportunity to do exactly that. the board of supervisors understands that addressing the affordability crisis by reducing or producing more for it will housing should be our top priority. this is opportunity to put our

money where the arm or mouth is. i would like to thank the supervisors for signing on as cosponsors, and the many conversations -- after many conversations with the marriage 's office. i have some amendments that i'll be introducing today that i hope you will all support. i would like to thank kelly could patrick and sophia kittler from the mayor's office for working so diligently with my staff to crack these amendments. the amendments i am introducing today should be in front of you. they respond to a number of suggestions from other supervisors and the mayor, and will do the following. one, clarified that it is intent of the board to appropriate at least 50% of all access revenues in each fiscal year to one time uses, and to make such appropriations on an annual basis. two, add -- mohcd will consult with the board of supervisors with potential uses of money of the funds in order to strive for

geographical balance. three, altered the funding allocations up to 60% of the money appropriated to the fund shall be used for projection, and 40% should be used for preservation rather then a 5050 split, requires mohcd to cement a report to the board of supervisors every two years evaluating and analysing the uses of money so that the board and the mayor can consider altering target funding allocations in order to meet new and ongoing needs for affordable housing. supervisor ronen? >> yes, thank you. i just wanted to clarify, i'm also a cosponsor of the legislation. >> yes, i didn't call your name, i'm so sorry. >> no problem. i also just really wanted to thank you for your leadership on this, supervisor fewer. we have never had an ongoing stable source of funding for the small sights program, and it is a very important part of the puzzle of our affordable housing

crisis in this city. it is a way that we prevent people from becoming newly homeless, it is a way that we preserve rent control housing that we are losing in droves, and we get a teeny bit from the housing fund for this purpose, but it is used up in two seconds , and when all of these additional really heart-wrenching opportunities come up of people, seniors, families, who have lived in their houses for decades, but are at threat of eviction, and when the building goes on the market, we don't have any funds in the program to stabilize those units. so i think this is, without a doubt, a priority. it is not only a priority in and of itself, we are way out of whack in our housing balance, and it is a priority to have that balance so the city can continue to be functioning, so we can continue to have a workforce that is able to staff

us at all areas of the economy. but also, all of the most pressing issues in our city, somehow intersect with housing at this point. whether it is a mental health crisis, whether it is having enough teachers in our classrooms, whatever the other issue is, it always has housing as a major component of it. by prioritizing 50% of eraf funds now and in the future for this purpose, we are recognizing that housing is linked to all of the major crises in our city right now, and we are taking action to do something. again, supervisor fewer, thank you so much for your leadership in this area and i am very proud to be cosponsoring this with you >> thank you so much for your support. any other comments? if not, let's open this up for public comment. i have some speaker cards here. winston parsons, mr. wright, if