implement the recommendations on slide 8 to include more detailed fund balance information in our annual reports. the process of developing affordable housing is complex, that is not news to anyone in this room. we are thankful for the bla for taking the time to work through some of these issues with us and to understand some of those processes. i am available to answer most of the accounting budget type questions you may have. my colleague deputy director for housing development is also here to answer questions you may have about specific projects or housing development process and director eric shaw is here to answer broader policy questions you may have. >> thank you. i do have some questions and my colleagues may as well, and let me

start with a question for the bla. just around stepping back and looking at this overall audit. this commenced by a motion adopted by the board of supervisors july 27, 2021. nearly not quite two years, but before the publication of the audit, so the audit took 20 months total and i wanted to get your take on why it took so long and also how that compares to your typical amount of time on the program audits that you carry out. >> first, i say when we start-there is the board motion we actually start the project and the following january and

then it took-it was over a year. there was causes of delay on both sides. sometimes it was us, sometimes it was the department, but how does it compare? it may have been somewhat longer, 6 months to a year isn't unusual for a full performance audit. we often start with a goal of 6 months. i think that was our original intent on this one. it started later then anticipated. it ran into the budget process where our staff gets redirected. it was slow getting the initial meetings set, so i could go through a lot of details, but suffice to say, it took longer then we expected and i think both sides contributed to that. >> and was the-we heard questions around how the data is kept and we'll hear from m

ohcd on that. despite a comprehensive audit that still as we sit here today there is still not the kind of clarity around what's committed, what's anticipated, what's available, and i just was that a contributing factor to the length of time to- >> yes, i don't think that as significantly to the time, but we did come back several time s and said can we get the data broken down this way or that way, but that is fairly typical in any audit to have few iterations with the department about the information we are reviewing, so that alone wouldn't explain it. it is a piece of the overall process. >> okay. i will just say that we authorize two audits at the same time and bla was working hard on both of them.

the oewd one came back i think 10 months before this one, and i will say from my observation, i don't think there was less work from bla on either of these audits and definitely was concerned and remained concerned with something as pressing as the affordable housing needs glad the audit was completed. i think the expectation is certainly that things will move more quickly in these audits. i think it is essential and they generally do and as i said, the oewd one requested the same time was returned and completed 10 months before this one. looking at the bucket of the

$313 million, trying to get more clarity on that. in the audit, and in your presentation it is noted that the new housing development loans and i think there is 58 percent of the total funds balance, that mohcd as you put it in the audit "did not dif rirchiate how much of the aaudit is committed under fully executed loans and how much is fully anticipated for not yet executed loans.". the stated reason in the audit for inability to distinguish is due to the amount of time that would be required for that analysis. is that-no further clarifications and so we remain in a situation where

hundreds of millions of dollars are not tracked as to what percent of those are actually for committed loans and what are in this anticipated but not yet executed bucket. >> at the time-i think all the records are there. it isn't a question about that, but it would take someone going through a lot of records. it is not summarized in a report or information system where that can be rolled out, so it would be-the way i understood it to a manual process to go through and track down all of those commitments and that's why you don't see the detail in the report. whether or not that is still the case, i think the mohcd should probably answer that question because i know they indicated they are making changes and implementing some of the recommendations and i don't know where things stand on that, but as of i guess

march when we wrapped up the conversation with the staff about that, that was the state of it. >> thank you. i think it would be good to hear from mohcd because what i'm trying to reconcile is the audit findings that based on how mohcd tracks this, they are unable to state how much and not tracking there is this much committed and this much anticipated. trying to reconcile that with the response mohcd provided. we sent a loi because our question was okay. (indiscernible) we what we got back was a statement from mohcd saying all the referenced $313 million was committed to specific pipeline projects so is it now the position of mohcd that since the time of the close

of last fiscal year and now that you are able to state that that full amount was committed and you now are tracking committed what exact amount is for committed projects versus anticipated? >> thank you for the question supervisor. i think that we are getting a little stuck on what committed means. there is different-the $313 million identify in the audit was specifically on a line that said, this is how much we plan to put out in loan closings in the next fiscal year. that is correct and that is-that was the response provided to in your letter of inquiry as well. that has played out as expected. the question that the bla asked us to

distinguish was,b at the point in time they were asking the question, they asked, could you tell us which of these-how much of $313 million have you executed a loan agreement for, versus not yet executed a loan agreement for still to be executed in the fiscal year, and it is correct, we our response to the bla was, we can absolutely provide that information. it would require us going-because of how the information is organized and how their information was organized in the report, we would have to go loan by loan and figure out was this incumbered or not and we between us and bla we need to agree on a date by which they wanted us to do that analysis. do you want us to do it as of today or january? but we said weez can absolutely provide

that information, but these are our constraints, and the bla did not to my knowledge ask us to do so. >> i'm trying to understand how that analysis is not a regular part of your doing business. so, at the time of the bla audit and the time period covered, you are saying that-it is documented in the audit. you have the $313 million pool and you can't say this amount fully committed with executed agreements, this amount is anticipated. you can't break that down, but today you can say that that full $313 million is now committed to specific projects? >> we at no point told the bla we could not break down that information. we told the bla that it would take

some time and provided-and we need to have a agreement how we were measuring, and to my knowledge they did not follow up and ask us to do so. the 313- >> let me just-so, it-the fiscal period at issue closed last june 30. the bla report and the responses from your department and everything were all released in april, so between end of june of last year and the beginning of this year- >> $313 million is applicable to fiscal year 22-23. the current fiscal year we are in. so things in motion. in the current fiscal year. >> as of the close of the last fiscal year, you could provide the clarity that of what was fully committed and what was anticipated?

>> absolutely and can do that for the current fiscal year as well, for fy 22-23. i could say as of a certain date, as of today we could go through the list of loans, we could determine which of those had closed, which of them had we actually incumbered in the financial system versus which hadn't been incumbered in the financial system and provide that breakdown. >> do you do that? do you ever report that other then in response to our loi? when is the snapshot you take if at all that says this is what is committed and this is anticipated? >> we do that generally on a fiscal year basis. at the end of each fiscal year, we do financial reporting as part of the city overall financial report. >> can you shed light on this, because it-these things are not-do not appear to be consistent to me with the findsings in the

audit. >> i will ask lendon berry who worked with these numbers- >> welcome. >> thank you. so, this question if you go to exhibit 3.2 on page 32 of our report, it has a little bit more comprehensive picture. this xebt you see at the bottom there is 499 total, that is amount mohcd told us is committed of the fund balance. referring back to the previous where we show 536 fund balance end of fiscal 21-22. of that amount 499 amount is the total committed. under what we are saying is committed, all of the information in exhibit 3.2 is committed under that. what we were trying to get at is, sort of the degree of commitment or level of commitment. there is a difference between

fully executed loan paper signed this amount is committed fully committed, right? compared to what mohcd is planning to do and this is what we were saying. for fiscal 22-23, the $313 million, depending on the date the loan might be executed and fully committed and it might still be anticipated or planned, so it it represents a mix and as mr. mc cloughsky was saying we need to choose a date we say has the loan been aexcuted as of january 1, 2023 yes or no but that would change if we chose january 15 and then there had been developmented between that time. so, i don't know if this sort of helps clarify anything, but i think broadly speaking, this $313 million we are talking about all of it is committed according to mohcd

but we were trying to get what is under a executed loan compared to what is anticipated or planned. they earmarked for a particular apurpose but it isn't fully executed. we were looking for that breakdown. >> thank you for--i have been in affordable housing work 20years and sometimes seems like when you ask for certain things everything is committed and no available when you ask for something else there is money, but maybe we can-i'll move on. i want to look at the uncommitted balance, so for -according to the bla report i think there is a $37 million balance of uncommitted funds. i believe that was close of fiscal year and want to check, is that accurate and have the funds been committed? >> thank you for the

question supervisor. this was addressed in the answer to your letter of inquiry. that differential is committed to projects in fiscal year 24-25 and beyond. that was not depicted on the table that bla created . so, if we had extended the table exhibit 3.2 a year or 2 out further into the future to show the additional fiscal yearsf ocommitment, you would have seen the $37 million. >> those are committed to specific projects but outside that- >> exactly, correct. >> is that-does the public see that information anywhere to know the $37 million is committed to project x in fiscal year 24? >> no, sir. >> is that going to change? are we going to get-obviously

the recommendations include additional reporting. i want to say, it is reasonable for the public, let alone the board of supervisors to want a snapshop of half billion dollars that says this much is committed to these projects, this much are anticipated to be committed in this next year, this much is being held back and committed two years from now. i had assumed i think maybe incorrectly that that was tracked in that way by mohcd, but can we expect that or have to legislate around that in terms of future reporting? are you able to maintain the information in that way and present it to the public? >> we have committed in response to the bla audit and in my comments here today to change how we are doing our end of the year fiscal reporting around the financing, and the bla did recommend to highlight

fund balances by fund source showing formal commitments and informal commitments that are anticipated in future years, so yes, we are planning to do that. >> thank you. that will be site by site basis, not just a lump sum of this much money for projects but saying what is anticipated in the coming year? >> i don't know the answer to that. >> happy to engage further, but think it is needed. >> if i may, i think that gets to some of the complexities around us potentially needing to change fund sources on a particular project depending on project delays. >> totally understand. everyone understands a project falls through you reallocate the funds, doesn't mean there isn't a way to generate a spreadsheet at close of fiscal year or upon request or dashboard that shows where the funds are allocated. they can always be reallocated.

>> understand, supervisor. the last thing on this issue is the-i keep hearing all the funds are committed and then our responses-your response and budget committee hearing as well as in the loi response is there is $41 million available for small site acquisition not committed. >> that is a great question. this table exhibit 3.2 did not include the small sites program. it was new multifamily housing development. >> i have gone round and round with director shaw on this at other hearings. two things cannot be true, we have all our funds committed and we have $41 million of uncommitted funds sitting in an account for small sites. or is this a definitional issue? >> i believe it is definitional issue. >> there is $41 million not committed to specific projects that mohcd will select projects

for that. is it committed because it is part of the small sites program? >> the definitional difference is this table produced by the bla was not inclusive of the small sites program. it was the new housing development. >> okay. >> and the small sites program operates in its own-it operates in its own realm. >> supervisor chan. >> thank you chair preston. i am not sure who can exactly answer this, but i think what i'm trying to understand is sort of this-i understand after all it is the mayor's office of housing and community development, so trying to understand that as like perhaps director shaw is here and he's in the audience can answer these questions and help us understand about these

money and how they are prioritized and project determined on this list. it seems like you do have some process but according to the bla report it is somewhat opaque. help us understand that sort of directly from the mayor herself and perhaps her team not that you are not, but perhaps chief of staff or deputy chief of staff as the team how do they communicate? what are the involvements? is it part of this opaque that we deem opaque and deem opaque process that is not clear to us is because that there is also conversation that you are not independently making some of those decisions and help us understand the influence or conservation going on. >> madam supervisor, we have a transparent competitive process for all our procurements. we go through nofa or

rfq. we do consult with both our partners and the mayor office to insure we execute in line with policy goals. we do consult with mayor budget office to also understand that we are executing in line with budget priorities as detailed legally and by the mayor, but there isn't a moment where i'm the director mayor office of housing community development, my team executes and develops nofa, manage the processes, they work in coordination with me and as noted and we talked about this in procurement, there is a moment within procurement in particular for rfq where there is the ability as me as a m orks hcd directser to exercise judgment to realize that either the expenditure of funds are in line with the policy priorities administration or goals, but i don't think it is appropriate to characterize that --i have

believe the confidence of the mayor to execute our programs and in line with the laws and policy priorities of both the city and the mayor. >> i'm not at all saying that there is any inappropriateness about the communications. i think it is rightly so. like the mayor and her team, she is elected by the people. her policy and priorities technically really supported by the people who voted her in and so it is not uncommon or unusual the mayor articulate the policy and priorities in the way she see fits within her realm. i'm not alleging it is inappropriate if her and her team influence decision making, just trying to figure out-i'm not also question completely about other then what we discussed yesterday 730 stanyan because of the prior

audit that pointed that specific process, but other then that jen ially speaking i think the procurement is standard and like standard in terms of city process so not questioning the procurement process or rfp process. we are asking the question is about before you actually get to that and it seems there are monies that are incumbered that is not formally articulated where they are going. that's all i'm trying to say. perhaps there is a process that is-that we did not formalize it, but maybe you can help us understand. >> thank you very much for that madam supervisor. we have been trying to figure out to reconcile accounting language from finance language. i have been using reservation. we go through a rfq or nofa

process, which executes an agreement for pre-development funding. we as mohcd are in for the long haul with the sponsors on that project so there is understanding-i believe right now there are 12 projects that are active and procured with $12 projects that are active and procured with i believe 20million executed in pre-development fixed cost. there is a understanding that on the back end there is going to need to be a gap commitment after construction is done and securing those things equals about $300 million. and so in that instance-but there is uncertainty between the state financing-so looking like may be uncommitted is a reservation to provide the gap financing to execute our pre-development

financing. so, on that instance it may look like money on the books but the understanding in the end, it is tethered to the initial pre-development loan commitment with guidance around state financing private financing and bond financing and think as you saw for stanyan in particular, then we come to the board for the gap financing commitment. >> yeah. i think that's the part where-at least for me like i needed that education for sure to understand like how do we look at this gap of the funding that we know is allocated specifically for specific project, that is clear to us, but then what do we do with the rest and i think that-i'm going to link this a little to because i see lydia is here and had the conversation about capital planning and thinking in advance about bond program and bond project, like how

we prioritize project that is currently in the pipeline and what can we do, and so i think those are the things that i personally would need more information on in order for us to be having a very productive conversation, particularly on a potential affordable housing bond in 2024 and both local and regional is that like, okay, so i get that there's gap between what is committed and what hasn't been formally committed, but do you know what i mean? how do we get there? >> i think madam supervisor and shared in budget before, the wild card in this is the state. they are changing their process, they are changing their policy priorities, they have been delays, and sometimes in inavailability of their funds in instances. what used to be not a competitive process with san francisco one of the first movers in taxing

ourselves to advance that, now we have our project applying multiple times for resources . what used to be hundred percent certainty in receiving state funds is 17 percent now. we know there is a impact on tax credit equity and pricing right now impacting gaps so there is a moment from the pre-development loan to the gap where we have the sponsors apply for both tax credit funding and state funding and what we have seen is-and we shared this very closely and sponsors have with (indiscernible) director (indiscernible) working very hard not to be in competition with la and san diego but there are moments in the end where we are ready to go a long time, there are new players in town with

their own bonds now, that meant financing to over subscribed 4 to 1. as we shared before on the procurement side that we adjusted our nofa's to now be in alignment with state priorities for funding, such that we have some more certainty and we saw now 4200 geary. high resource area, vast vouchers, we aligned with the priorities and also the bla and board all agreed on geographic equity but been leaning on the alignment there. i think in that instance we are working hard to anticipate the policy direction of the state such that we are procuring projects we believe will be better positioned to receive state financing. >> i think that for me as a district supervisor on the west side-let's be very candid, we have not seen housing

development in the rate we actually deserve, and particularly in my opinion affordable housing development that we really desperatehy need on the west side and at the same time, i do see that we are great candid, which i appreciate because yesterday we have can't quite remember the address, 4,000 block of fulton for small sites. >> right. >> community land trust which i totally appreciate because that is what we need, and all which to say that i personally representing the richmond want to be competitive. i want to influence your process to say, hey, the richmond deserves this and we want to do this, so i'm going to put it out there that like, i am more in the space of like, the reason why i love to learn more about it and see like to try to help me understand how do you decide is then like, i can influence you and advocate according to the standard you set.

>> i think our last including the most recent acquisitions because of high resource areas for the state, we've leaned into that, so the two priorities that we asked for for projects was there was a pool for emerging developers that goes around the competitive process to accelerate funding, or it is high resource areas so i think once again we have been pretty successful and looking at supervisor engardio, the two projects that got the most state funding was 2550irving and 4200 geary. we are recognized that alignment we are also right now working within the need to realize we made commissions to communities in mission and soma and been articulating to the state in particular that we are glad you are leaning this way,

but there is still unfinished business in other communities around the state and that is also clear and believe hearing with supervisor safai versus high, medium and low resources but these are state mandated funding priorities that we are leaning in and i think in some instances in particular with the bla audit that was recommendations that came when i first got here one was about geographic equity and think we are seeing that now. it is incorporated in the small sites guidelines, a lot of guidelines listed in particular the geographic equity piece and that is in the housing element and ort places as well. >> thank you supervisor chan. before i turn it over to supervisor engardio who i know has questions, i want to follow up on supervisor chan's line of questioning just around some of the decision making

processes here and your comment of the-as you phrase, transparent and competitive process. the audit found mohcd does not have formalize process workflows or record keeping process that provide clarity how decisions are made, and so which lead them to conclude that given those systematic deficiencies and again i quote the overall transparency of mohcd funding decisions and processes is impaired. so, when you speak of a transparent competitive process and when these questions have come up your response is our process is transparent and competitive and issue nofa and rfq and work together on these things and familiar with those.

here is the catch-as came out very clearly in yesterday's hearing on 730 stanyan, the end of the day, this is not-mohcd view is unlike other procurements in the city for professional service and others where there is a high score for competitive process and that person gets the contract. that isn't how that works here. at the end of the day you and or the mayor or you i think can decide regardless of the scoring and process to award these contract loans funds at the end of the nofa and rfq process and i'm not asking for legal advice, i'm making sure i agree, but from your perspective as the director, it is your call, right? at the end of the day it is your call. you are not obligated to award any

of these to the highest scorer in the process, is that right? >> there is discretion put in all our procurement for mohcd director to weigh in and make the final decision. >> right. and so when-here's the problem, sometimes discretion is great. sometimes it leads to great things. other times it is what we are trying to rein in having oversight bodies whether that is a commission or the board of supervisor or a law that regulate how we do that. my question is, do you agree that the lack of policies around how you exercise your discretion coupled with the fact that you have-you and/or the mayor have unilateral discretion to make the decisions do you agree that creates a risk of improper decision making and influence in this process? again, not

alleging improper decision making but do you agree the system we have and that structure and the lack of the controls that have been identified through this audit creates a risk of improper decision making and influence on key affordable housingition cans? >> supervisor preston, i think that discretion is exercised because the way the procurements happen are we ask for teams to be assembled. it is experienced developer, service provider, property manager and i believe owner of properties. we don't actively solicit. teams come to us. we say here's the opportunity, please come to us with a team and we'll scrore score on that and in that instance i

believe there are some times where there needs to be a question of we had a great development team but need stronger property management. that discretion is exercised to make sure in the end we meet the policy, service, property manager and timeline goals, so in particular-once again we brought this up with 730 stanyan, but i recognize and appreciate and consulting the other sponsors, given the complexity of the design, development and financing of 730 stanyan, the consal tailgz consultation with the sponsors and director at it time has a very strong team that i won't say may not have

happened independently of either (indiscernible) getting that, but happy that team is together because the lift was so heavy that the decision gave more weight to move the project forward. >> can i get a yes or no whether this structure as we described and discretion you have-it is fine if your answer is no, but does the fact that you have unilateral discretion in the decision making and the lack of as detailed in the bla audit, the lack of detailed guidelines around the decision making authority here, does that create a risk of improper decision making or influence? i think the public deserves yes or no. you may think the system for the reasons you said is beneficial and doesn't have that risk, but i see a lot of risk and i really

would like as we look at possible policy reform s to know whether you concur with the sentiment, mine, i think from the bla audit that it creates a risk of improper decision making and are influence or not? >> the characterization of unilateral authority is still a transparent process, we have active solicitation. i think it is appropriate for the director to exercise judgment needed to make sure that we have response in a timely development. and i will also note that there are a series of checks and reporting from both the reporting from the loan committee reports, from underwriting guidelines, from also reporting and getting consent for funds by this body that explain policy decisions,

explain finance decisions, hold the appropriate accountability how these deals happen and so i believe in the process and i believe that there is not a moment where i can wake up and just as director and just make something happen, because i'm accountable to a transparent competitive process where processes are review jd people submit proposals and have active conversations for responsive and timely development. >> you are accountable to a transparent process and competitive process as you say that does not have any guidelines how you exercise discretion and also that you can unilaterally preempt at behest of the mayor. that is the structure without comments whether the structure is abused or not that is the structure and the problem. supervisor engardio. >> thank you. i like to just zoom out a bit just for the benefit of the residents of san francisco. people are

watching on sfgovtv or watch later online or streaming. just to understand what is at stake here and why you do the work you do and why does the office exist. we have office of housing community development, it is mayor office of housing community development. why is it the mayor office, why do we have such a office, are there other places that can do this work? give us a overview of why? what is at stake? everyone is watching, supervisors in the weeds in a audit and director talking about it as we should but give a sense why is at stake and why are we caring about this? >> i have never been asked the question before in 30 years of service, thank you supervisor engardio. i think that one, we actually work in a network of high cost city housing forums so boston, seattle and

have a somewhat structure to lot of other large cities in the country including how we procure, including the roles of department or not, sometimes it is mayor office, but department of housing community development in dc, similar authority and roles. it is imperative i have 120staff members who are technically trained in finance and so i think the experience and expertise many of them all by deputy director have been with the office 15 years or longer so there is institutional memory. i think there is the ability to move big moves. i give credit to deputy director lydia who spearheaded the rap rad program. we have been recognized as a national model, but there is a need for technical expertise

and understanding of community and ability to convene community partners to execute a vision and the vision is equitable housing. i think there is also a role for us on the placement of inclusionary units through dahlia and on community development investment of housing stability that the office works in a way that really centers the ability to advance housing opportunity and housing stability, and so i function as a director under mohcd strategy. if we can't buy the building for small sites is there is a shally subsidy or emergency housing assistance or preference that allows these things to happen but working as a integrated agency and have this resident focus allows us to advance the larger moral obligation to create housing stability and advance housing opportunity.

>> for the residents of san francisco who says, my grandkids can't live here or it is expensive forever, this department, this office hasn't always been in existence, but in the time it has been do you see improvement or what is your goal for improvement? what should we look for 5 years from now? >> i think in 5 years from now the mayor made it clear, she is deeply committed to realize the goals through the housing dwem. development. we are working from housing authority, ocii and real coordinated manner under housing for all framework and think also that-we all acknowledge there is a deaf std of affordable housing for a while. there is still deficit of affordable housing, but when the resources became available, our team had expertise to mobilize quickly and we have a long memory and we understand that regardless of how

the state works and shared with you before, i have a monstra, if you stay ready you don't have to get ready. when california housing accelerator fund had billions of dollars available for shovel ready projeths we got the most amount money there because it takes fortitude and patience but when the resources were available they were mobilized immediately, so i think that it continues to be a lot of advocacy at the state and federal level for more resources. there continues to be at the urgeer of the mayor and this board to maintaining of pipeline. i think there is urging of the point for us to be through the mayor housing for all to be flexible and how we expend and how-we need to meet the need how we can meet the need within the guidelines and resources that are available and i think we are there as a housing office and i wake up every day and

the mayor reminds me every day, i have to meet the housing affordable goal, the affordable housing goal or strive to do that every year. >> is there a reason why this has to be the mayor office because i heard fellow supervisor say, i like to have a say in my district. i would also like to have a say. not judging, maybe there is a good reason and should be, for the people of san francisco, why the mayor office of housing community development? >> so, the structure of our space of our space. i told you, this is a similar structure to all most every major department. i do want to note also in the bla audit there was delay of a project due to strong supervisor intervention. i think that we leaning in this transparent competitive process, it does create certainty. i know that unfortunately as we shared,b

there is some supervisors that are moderate income areas that may not get state funding. if the goal is get housing as fast as possible there needs to be two tracks. to change state policy to be able to be more mindful of this, but also at the same time, make sure there is a city priority for acceleration alignment with state financing which means we lean on high resource areas only. if the priority was to put something in a moderate resource area, with no guarantee of state money, then we expended money and waiting and not in alignment with the board goal and the mayor goal of accelerating this. i also believe in the end that i just believe in the end that there are so many eyes on mohcd and so many ways in all the transactions, from the private level and interagency

level, reviewed and approved here by the board, that we shouldn't get stuck on the name. we understand the mission and the mission is universal within the city to create more housing. >> i appreciate you giving the overview so residents with understand what we are talking about. last question on the audit itself, the executive summary says that they found some of the milestone reports with limited value, but offer recommendations to improve the milestone reporting. do you agree? >> we accepted those and adjusting accordingly supervisor. >> thank you. >> thank you supervisor engardio. before we go to public comment, can you just clarify on the pipe-a lot of reference to pipeline. is anything available publicly that shows the public

the pipeline, including the order and priorities because there are some neighborhoods where they have been told for decades that something is in the pipeline and no one has any idea-there is no transparency with the public i'm aware why certain things move or not. is it available to the project and think the answer is no project by project where it stands in a prioritized fashion and number two, if it doesn't exist to the public, does it exist in your office? >> i believe that as part of the updated reporting that we are going to share the massive spreadsheet-the pipeline is all the projects are procured at a certain time and so there is a line between our procurements and the pipeline that is there. all the products have been procured. we are reporting. >> that isn't my

question. we get fees coming in. we get inclusionary housing fees and we have a balance and you know what the balance is. we also have needs of things that you and the department want to develop affordable housing. decisions are made how the funds get allocated and to what projects and my question is, other then internal discretion and analysis, is there anything publicly that shows this is at the top of the line? when the funds become available over here this is first we are funding, this is second. understanding things can change if project one doesn't get state funding or something falls through, but asking if there is project by project information on the pipeline and prioritization? >> i think yes where we are finalizing as part of the report for the pipeline. i think--i want to be mindful of prioritization. we

don't sit in the room and say this is better then this one. we try to execute-we know what is in the pipeline and no throttleling how things happen. we want to move a project from final procurement to completion as fast as possible. that process takes about 7 years, and so i think if someone is in the meeting and they are having-we start the initial community design, i think people assume after that last design meeting there is a shovel in the ground. we need to have that concept there in a way to get the secure financing, break in the groubd ground and do that. we been using tools like sb35 to accelerate, but as mentioned some of the projects applied multiple times for state financing so i want to make sure in the end we put the onus on the sponsor to try to secure the funding. we have

been fortunate doing that, but there isn't a room-there isn't a room where i sit and go, this goes better then this one. we are trying to understand where our projects at and the timing but with the goal to move them as fast as- >> thank you. what i respectfully submit is, there is a process by which that is happening, and it is not one the public can see and it is one that involves quite a bit of discretion unsupervised by a commission or any authority in the mayor's hands your hands and-i understand there are challenges reducing that to a more public facing document that shows that transparency, but we can say the word transparency as much as we want, but when you have a process where you and putting a bunch of factors together with no guidelines and making choices unilaterally and your

team and i would submit and i will refrain from going further before public comment, i submit it is probably the worst kept secret in this building that the mayor absolutely intervenes to influence that project. it is like at some level everyone knows that-there is no guardrails to prevent that and no reporting like here is our list and priorities, so therefore if you are concerned about this site you should know that's number 5 on the list and maybe it will move to number 8 if there are no funds from this source or that source, but here it is. that doesn't exist. >> we don't have a list. >> understood. >> we have a transparent process. things are scored. there >> things are scored in a process that could be over ridden by the mayor and

director of mohcd. with that, let's open public comment on this item. >> thank you mr. chair. any members of the public who like to comment for item number 2? please line up along the wall to your right. remote public call in members, press star 3 to be added to the queue. for those already on hold, please continue to wait until the system indicates you is been unmuted. you may approach the podium. as reminder, all speakers are granted two minutes. if you are in the chamber the podium will alert to when you have 30 seconds leftd left and the second beep alerts your time conclude ed. >> sandra dratler here as a leader and faith in action at saint james church in the richmond. we welcome the issuance of the performance audit and encouraged by mohcd openness to hearing and responding to the recommendations. the lack of report ing and transparency leads to unease that funds are unnecessarily held or

being allocated in ways that do not move us toward our shared goal of increasing the truly affordable housing stock in the city. the issue of particular interest for faith in action. when we hear that there is a $500 million pool of unspent funds it brings into question how the city is addressing its own goals and in housing. if the process of identifying and fundsing projects is done right, it will be easy to report on. the lack of reporting and transparency and funding decision process leaves room for favoritism and at worst, corruption in the process. as m orks hcd moves to provide the requested reporting, the most important task is to define the processes within the department and held accountable for these first to the mayor and directly-who directly oversees the department and secondarily to the board of

supervisors. the metric falls short measuring the effectiveness of programs (indiscernible) don't focus on projects completed and people housed. we will never meet our housing goals without improved processes one mohcd that move projects along and provide that needed housing. thank you. >> thunk thank you for your comments. >> nay name is (indiscernible) president of mercy housing california and past director of mayor office of houseic community development and supervisor engardio, i dont know why it is called mayor office of housing. i inherited the system as well but believe it goes back to the 60 and 7 # oand think about tradition. i are want to make 2 or 3 comments. a audit is important process and need to understand if funds are well spent. from a capital management perspective when is one portion of the audit i don't think that

the findings in the audit represent a problem and i want to tell you why. as director shaw indicated there are multiple steps in the processm you need entrepreneur developer jz to some extend a entrepreneur minded staff that recognize the changes conditions of the state and able to deploy capital as things change and they do change all the time and i think the city both through ocii and mohcd have been successful addressing opportunities as it occurs and moving capital. there are a couple examples. no director of any city department should be advertising how much money is on reserve for a project because it tells the sponsor they have the money and the general contractor they have the money. you want them to be competitive. you want it reserved as indicated by mohcd staff. as far as processes go,

i want to just say i think it is a reasonable transapparent process. we work throughout the state. with that said, i think making sure we have publicly available reports, the scoring system and scoring for projects are available to view and my experience that is the case over the years. i assume the case now. we haven't had a reason to question those. thank you. >> thank you. next speaker, please. >> chair preston, supervisors chan and engardio, my name is whitney jones here representing china town cdc. among our work is development of affordable housing, we produced about 3500 units all in san francisco with another 600 in progress. not here to speak to many recommendations, i am here to speak to debunk the

mohcd has pots of monies it isn't using or managing efficiently or clearly. along the same lines as doug comments. i had-a voice for the need for flexibility. i had projects delayed for the state changing the funding priorities, decision to increase the number of units dispute over ground floor use, recession, change to federal tax laws, rain, a neighbor suing over a tree, et cetera et cetera. those delays may shift funding from one fiscal year to the next but still need the funds when the project is ready to go. funding issues at the state or federal level the amount needed to fund may change. projects are uncertain in every way. i

would be perfectly happy having mohcd commit the maximum amount needed at the beginning of the project through hard commitment of a loan, but myself interest recognizes that is bad policy. p imagine if they committed $50 million to a project that isn't done for 7 years as director shaw said. they would be pillared for that. it is a no win situation. if the project is unable to be completed that would also reflect badly on mohcd. i just are want to speak to the need for flexibility in that money. the reason for it not being committed. thank you. >> thank you. next speaker. >> good morning committee members. chris comings director of housing development for the tenderloin neighborhood development corporation. very active in both developing and preserving affordal housing in san francisco in partnership with the mayor office of housing community

development. we have over 10 projects under construction or in pre-development. here to speak in specific support of that practice that both mr. mc cloughsky and mr. shaw mentioned earmarking gap financing for projects awarded through a procurement process. that is absolutely critical to success in developing affordable housing in san francisco. not only does it provide assurance for tndc and stakeholders to effectively deliver the housing as intended, but also allows us to be as competitive as possible in securing those state and federal dollars in addition to what is committed through the city and to mr. shaw's point, it also allows to be as agile as possible aligning the projects with the changing state policy and housing regulations. tndc

supports the mayor office of housing in the practice and urge you folks to do the same. thank you. >> thank you, next speaker, please. >> good afternoon supervisor. john avalos with the council of community housing organizations and i stand alongside tndc and mercy housing and tcdc. we know there isn't existing $500 million of unincumbered funds available. i think it is important to understand that we are living in a real scarcity model and the unpredictability of how dollars are going to be used, dollars are incumbered softly is part of that what will happen when we have a scarcity of funds. i think it is important to look at and have conversations like this is really important to

look at as we look down the pike for regional housing bond, local housing bond or other sources of fundsing how do we see the ground in the public solutions to make sure they implement the policies and resources to build affordable housing? i think it is also important to look at what is our goal we are trying to do? are we looking to implement and allocate the resources that have been given us or do we want to look down years ahead to see how we grow the resources to be able to actually meet our affordable housing crisis and to resolve that with housing security for people in san francisco. that should be our north star and goal. i think helping to resolve this problem would be very very helpful to have a predictable large ever increasing year over year amount of funding we know is available that we can actually allocate every year to insure that there is predictability in

projects, that would be a ervavery helpful thing alongside building a department of housing community development that is coherent in the approach lifting up the voices of members to identify the housing that they need and find the resources in the department to make sure that housing can be done. thank you very much. >> thank you. next speaker, please. >> good afternoon committee members. my name is alex research advocacy director for san francisco electrical construction indust ry and also with the buildings coalition. thank you for the audit. i think it is really important and i think transparency is absolutely paramount, especially as said, we will go out asking for regional money, local money and there is ultimately we need to confidence of the public to get these things. specifically i want to talk about mohcd experiment with out

sourcing affordable housing construction to out of area factories. we had 4 projicts in town now all had significant problems. the maceio may problem you all recently provided $35 million to deal with a variety of building defects as well as repairs that had to be done for that project. undisclosed added cost for 1064 mission and mission bay block 9. 833 bryant the project celebrated as some sort of lower cost achievement had significant problems just in the past month and a half. there is contractors that had to have been brought in to fix dry wall, sloping issues in the bathroom shower pan and this is all the consequence of using under-trained, under skilled labor done way out of town and

having it be inspected by third party private inspectors who are only accountable to the factory. ultimately this forces us to lose money on the back end. some say tripping over dollars to save pennies. we lose locling hiring hours, opportunities for local contracting and end windup a substandard product that (indiscernible) thank you. >> thank you. next speaker, please mpts >> good afternoon supervisors. tes wellborn, district 5. very concerned that the production of affordable housing in san francisco has been lagging and with the new goals that the city accepted and endorsed with the housing element. we need something more like a space program. also

concerned though that the audit shows that there's a whole lot of unknowns about the mayor of housing-mayor office of housing and community development division process. who does what? there seems to be a lack of accountability. i wonder also about the turn-over in that department about how is knowledge being transferred? we need a lot more of real affordable housing and that means for families and individuals under 60,000 a year, not hundred thousand a year as i heard was low income now for san francisco. using the hud standards doesn't work for san francisco. i'm hoping that you will be able to think of some things to do in the short-term, but also

looking what your long-term options are to assist in this goal, which i know you care about deeply. thank you. >> thank you. next speaker. >> mohcd asset manager was here. she gave a presentation about residual receipts, right? anyway, the bottom line is, i was prevented from coming and entering this room today. there was somebody physically blocking the pathway and couldn't enter the room without making physical contact with this individual, and this is intimidation, it is violence, it is preventing me from being here and speaking about this issue that is very important to me. this audit is a scam is what it is. it isn't real. when you look at it,

this is a bunch of people that come together and determine the outcome before they have even looked at the issue. looked at the numbers. mohcd is a scam. basically a scam. i think a scam. that is all it is to me. these guys are building buildings all over san francisco. they are building a playground for kids to play and you have to say is there discrimination and racism there? why can't kids play on the playgrounds? why can't kids play? it boggles your mind. when you look at it, if you don't let children play in the playground and this is a city supposed to be a free city asset, a public good for the city, it is discrimination and

racism. a moment of silence--10 seconds of silence. >> thank you for your comments today. any other speakers in the chamber that would like to speak to this item? seeing no additional speakers we'll go to the call in line where we have 8 listening and 3 in the queue. may i please have it first speaker? >> eileen boken speaking on my own behalf. 100 percent affordable housing projects in the western neighborhoods are all by the same well connected non profit. even though this non profit has no prior experience in the western neighborhoods. two of those projects were advertised on the same nofa. a project (indiscernible) moved forward by the city wide affordable housing

loan committee despite high unit cost even though this was noted in the mohcd report, and the mohcd report to the city wide affordable housing loan committee appears to have failed to note that the site was contaminated. regarding the comments about the role of the mayor, mayor chief of staff and mayor deputy chief of staff, it is my understanding that they were directly involved in the district 4, hundred percent affordable housing project at multiple points. also, the project team for the d4 project stated the d4 project was not senior housing despite d4 having the highest percentage of seniors as that was the district 1 project for senior housing and mohcd did not want two senior housing projects on the west side. this decision could be seen as unilateral as

well as arbitrary and capricious. thank you. >> thank you for your comments. next speaker, please. next speaker. >> board of supervisors, my name is francisco decosta and been monitoring the mayor's office of economic development for a long long time. as the audit has clearly stated, this organization has no guidelines and there is only so much you supervisors can do, especially the chair of the budget who wants the director to come and speak--he's a good talker and he muddies the waters. we need the federal bureau of investigation to

follow the money. when this is done, we will see the role of the mayor the role of some of the non profits like mercy housing and the role of some individuals who act as expediters. i have many contractors who i have known over the years. none of them want to work for the city. i repeat, none of them want to work for the city. the board of supervisors should have guidelines [audio cutting in and out] affordable housing is concerned, that has not been done by this city. they favor big developers and they favor those that are not poor. they don't want to have

indigent. they only want to have those where they can get some favors from. my name is francisco decosta, the director of environmental justice advocacy and i have been monitoring these clones for the last 40 years. >> thank you for your comments today mr. decosta. all speakers are limited to two minutes. may we please have the next caller? >> good afternoon chair preston, supervisor chan, supervisor engardio and president peskin, charley (indiscernible) coming on behalf of the council of community housing organization. i like to start off by expressing my appreciation for the staff at mohcd who work extremely hard to administer the nuts and bolts of financing affordable houseic projects in a very challenging environment. our city continues to face extreme housing insecurity and now more then ever we need

mohcd to be up to the challenge our city faces. we need to insure public institutions like mohcd are equip with tools and powers to insure successful implementation of the affordable housing mandate. bringing affordal housing system to scale require foundational steps and filling in the gaps (indiscernible) that means all the good governance reforms recommended by the budget legislative analyst and go further. we need to insure that a agency #1u67 as mohcd can go long-term strategic planning to insure we have a year by year plan and strategy to achieve our rhna production goals in the coming decade. this will require achieving real accountability for housing spending, growing permanent funding and affordable housing building program for the city. building a long-term resources to achieve our housing

element affordable housing goals stabilizing local economy workforce is one of the most important decisions the city will be making in the next few years. we appreciate the board's leadership on the important issue and we know all this will require working together with the board, city agencies and community stakeholders to build a shared vision to strengthen the reach and impact of public institutions that are focused on affordable housing implementation. thank you. >> thank you so much for your comments. may we please have the next caller? checking to see. that was our last caller. >> thank you madam clerk. public comment is now closed. i want to thank the bla for all their work on the audit and thank you mohcd director shaw and your team for your presentations and your work. i think we have gotten some more clarity to some issues in the

audit and look forward working with you to have more compliance around the reporting and transparency in the decision making process. i will say in conclusion, one of the comments from former mohcd now affordable housing person was we haven't had a reason to question the structure, i think that exist, i beg to differ on that. i think that we-i have seen many instances of what i believe to be the mayor weaponizing some of these affordable housing decisions in ways that are more about politics then about achieving our affordable housing goals, often apparently against the conclusions of the experts whether on staff or externally and interfering in projects in terms of applications

and decisions in ways i think are highly problematic, but the purpose of this hearing isn't to express my opinion one way or the other or share a project, it is to high light the result of a audit and the structure and believe one of the most significant things in the bla audit is around the lack of rules and guidelines governing these decision making processes. we are just left to sort of trust how decisions are made and ultimately have heard that the mayor and mohcd director have unilateral decision making authority around what is repeatedly described as a competitive process and so i think that is problematic and think we need to look how to increase transparency and oversight and look forward work wg the department and bla and my colleagues to do that. unless further comments or questions and seeing none, i like to make a motion to file this

item. >> thank you. on the motion to file this hearing, member engardio, aye. chan, aye. preston, aye. you have three ayes. >> thank you. that motion passes. thank you everyone. madam clerk can you call out of order the item 4? >> item 4, hearing to review the monitoring and oversight of city and county of san francisco contracts with tenants and owners development corporation (todco) and review the number of historical complaints filed against todco buildings; and requesting the department of homelessness and supportive housing, mayor's office of housing and community development, department of building inspection, and planning department to report. those joining remotely, please dial star three to be added to the queue. when we go to public comment wait until the system ind iticates you have been unmuted.

>> thank you this is sponsored by supervisor stefani not here today and request ing the item continue to call of the chair and my intention to move to continue this item after public comment on the continuance. >> thank you mr. chair. any members of the pub lic who like to comment on the continuance of item 4? please line up along the curtain wall. call in members dial star three to be added to the queue. those on hold, please continue to wait until the system indicates you have been unmuted. seeing no speakers in the chamber. we have 5 members listening and zero in the queue. no callers. >> thank you. public comment is closed. motion to continue this item to call of the chair. please call the roll. >> on the motion, member engardio aye. chan, aye. preston, aye. you have threei ipolks. >> thank yout the motion passes. please call

item 5. >> item 5 is resolution authserizing the mayor or designee to cast assessment ballot for formation of property and business improvement district to be named excelsior community benefit district with respect to certain parcels of real property owned by the city. those remotely, if you haven't done so please dial star 3 to be added to the queue. the prompt will indicate you raised your hand. please wait until the system indicates you have been unmuted and you may begin your comments. thank you. >> thank you madam clerk. this item sponsored by supervisor safai. we will hear from chris corgs, community economx development and welcome bill barnes from supervisor safai office and understand we have a short prezen taishz. >> try to make it under a minutes. as you may

know, the board of supervisors may 2, 2023 passed resolution declaring intention to form the excelsior cbd and initiate the ballot process. may 26, 2023 the department of elections will mail ballots in the proposed district with 3 going to city and county of san francisco. the city may vote on these parcels if the board were to approve the resolution. a list of -there is total assessment (indiscernible) 2.02 percent of the weighted vote. here to answer any

questions you may have. >> thank you very much. unless there are presentations let's open public comment. is >> any members who like to comment on this item? line up to your right. dial star 3 to be added to the queue. those on hold, please continue to wait until the system indicates you have been unmuted. you may approach the podium. >> thank you so much. i have been waiting for this opportunity the whole day. i'm here to speak about the issue. the mayor office is resolution or designee to cast assessment ballot for formation of property business improvalment destricate names after excelsior. excelsior is very important. it is very important. i want you to find excelsior, find it

district. the supervisor who used to represent excelsior was here, avalos. is he still here? can you find him and ask him why this is-why am i here? i want to know why i'm here for the excelsior community benefit district. find out why. that's all i want to know is why i'm here, because my american passport came from excelsior are. john avalos gave me my american pass port. if you can make a decision about naturalization that you can't get out of, you cant change your nationality. john avalos, i'm a u.s. citizen and why i come here and

talk. why? why? i want to have a moment of silence to get-to please find out who is doing this. who is doing this? can you fiend out who is doing this? 15 seconds moment of silence, please. >> thank you for your comments. any other members in the chamber that would like to speak to this item? no speakers chair. >> thank you madam clerk. public comment is closed. i like to move to send this item to full board with positive recommendation. please call the roll. >> send item to full board with positive recommendation, engardio aye. chan,

aye. chair preston, aye. you have three ayes. >> thank you. that motion passes and thanks to mr. corgus and his team for that. madam clerk, please call item 3 on the agenda. >> item 3, hearing to receive presentations on the response times for and cause of the april 26, 2023, power outage that disrupted electric power and water supply to the northeast quadrant of san francisco through may 1, 2023, and the regulatory role of the state in ensuring accountability and oversight of state of good repair for pacific gas and electric company (pg&e) power infrastructure, mapping of residential areas, existing electric fire-fighting capacity and resources, and essential communication to impacted local residents and city responding departments; and requesting the california public utilities commission (cpuc) and pg&e to present. for those remotely, if you haven't done so dial star 3 to be added to the

queue. the system prompt indicate you raised your hand. when we go to public comment, wait until the system indicates you are unmuted and may begin your comments. thank you. >> thank you madam clerk. this item is sponsored by board president aaron peskin. before we go further, as you can see some of the committee membership has been swapped out for this item so i like to make a motion to excuse supervisor engardio from the remainder of the hearing with thanks for him sitting in for vice chair stefani. on the motion. >> thank you. on that motion, member peskin, aye. chan, aye. preston, aye. you have 3 ayes. >> the motion passes and for the record, president peskin is not only the sponsor of the item, but is also appointed to sit on the committee for this item item 3. president peskin.

the floor is yours. >> thank you chair preston and thank you for accommodating this hearing today. i know that you have a highly impacted calendar so i really appreciate it and i just want to start by thanking the individuals and organizations for your patience this morning. but more overly, for going above and beyond the call for your patience for in many instances 4 days that spanned the power outage on the evening of april 26 last month that impacted some 10 thousand customers initially and very important to emphasize that a customer may be a lot of people and we will get to that in a minute. i was one of those effected customers and was sitting down for a for a late

dinner getting on towards i think cooking around 8:30 and the lights started flickering and after 8:30 and a few minutes after 9 we were eating dinner in the dark. i was one of the fortunate ones, our power came on the next day at 11 or so 11:30 in the morning, and i made the command decision to not open the refrigerator, and this isn't about me and what i experienced. that refrigerator is important because people without power several thousands individuals for days that minute no access to food and in many cases no access to elevators and no access to water that relies on electricity to pump water to higher stories of midrise and high-rise buildings. so, i really appreciate all of you coming out here today.

i'm aware i don't know all the facts related to the recent outages, but i hope that today we will all understand them better after this hearing, and these out ages are not new to me or anybody. the city experienced many of them outages, fires, explosions over the years that have disrupted daily life, impacted businesses and economy and in some cases actually caused physical harm and even death and have needless to say cost millions of dollars. some of those many years ago i had a constituent who actually was-had suffered third degree burns over large portions of her body from a vault that blew up

down on kearney near post and then chief hayes white and i visited that individual in the burn center at saint francis hospital, and these go back many many years. even a couple years before i was elected a quarter century ago, san francisco suffered a catastrophic power outage that resulted in 456 thousand pg&e customers losing power with at least one person killed due to a traffic signal outage. in 2003 pg&e mission district substation caught on fire which lead to a state puc commission investigation which included a previous fire at the same location. many of us were

around for the incidents that happened just down the street here at larkin in 2009 or excuse me, in 2017. excuse me where a fire caused a outage of electrical power to about 88 thousand customers. there are plenty between those years, but electrical vault fires are not new to us. in a unprecedented letter i dont think i have ever in my 23 years since i was first elected seen a letter like this. the mayor, the city attorney, the head of the san francisco public utilities and myself in my capacity as president of the board actually all signed on to a letter to pacific gas and electric, which is a part of this file and i distributed to my

colleagues on this panel, which pg&e did promptly respond to where we wrote about the recent outages as well as pg&e outage protocol around communications particularly, and we noted in this letter, because we are in the power business too, that outages will happen and sometimes the utility can't prevent them. this makes pg&e response to outage more important and i want to drill down into that a little bit, and because the response is something that the utility has control over. we asked pg&e to improve its outage communications and again i appreciate pg&e timely response to the city letter. but the response is disappointing in so far as it offers no indication

at least to my mind in reading the letter that pg&e will work improving the outage response. according to the letter, pg&e response was entirely appropriate. that is the position of the leadership of pacific gas and electric and dont think that bodes well for the city hope for a collaborative working relationship that seeks to minimize future outages and provide more accurate timely information to impacted customers when outages occur. the city letter addresses another subject the long desire to exercise the consitutional right to provide electric service within our own jurisdiction u about that isn't the subject for today's hearing and we will not get into that but we asked pge to work collaboratively with us to accomplish that transaction in a way that protects all of the customers in this territory and

as pg&e letter states, they have unfortunately declined any discussion of those issues, but we'll leave that for another day. today is about outages in san francisco. why don't we-i appreciate the indullance of the committee, but i want to run through this and get as much information on the table as compacted time period as we can. why don't we start with chief postel from the fire department just to go through a recitation of the facts as to what happened that night and subsequentially and i note and i actually happen to be nearby when i got a text from the chief and i actually went there on saturday april 29 when there was a second fire nearby that

was minor but connected to the repairs but i want to delve into what happened. in that moment in that might i still had power in my phone, fortunately well charged able to text back and forth with the chief as to with we got our first 911 calls, when our first units arrived on the scene, which i am proud to say was under 4 minutes, and when the call went out to pg&e which was about 3 minutes later and want to state for the record that in the initial moments that night and words i said subsequently i was wrong relative to pg&e response time. i was informed that night it was 40 minutes, it was less but i want to put that for the record because i want everything to be accurate and made the statements based on information i had at that night that turned out not to be accurate. chief, good

afternoon, welcome. >> good afternoon president peskin, chair preston, bob postel. brief synapsis all response that night. the initial call in at 2442 hours, 842, and that incident was created at department of emergency management dispatch. wesent an engine, truck and battalion chief to the initial report. first unit arrive on the scene 4 minutes later at 2046 hours engine 13. they reported smoke and fire from a vault at sampson and halic. request for pg&e made shortly thereafter. we conformed at 2049 pg&e had been requested. at 2050, we got reports of the second incident in the area of montgomery and clay. we sent another engine and truck to that, engine 2 truck.

it was determined that was related to if had initial incident. 2052 hours we were notified pg&e was reporting that would be there in 15 minutes. they arrived on scene, 2109 so about 20 minutes, but pretty quick response for us. at 2148 hours, we reported the active fire had been contained. our initial actions in a incident like this revolve around public safety so we identify where the vault is, what structures, vehicles, people are threatened. isolate the area, notify pg&e we have a vault fire through department of emergency management. protect structures and protect surrounding areas, but not engage in active fire fighting or suppression efforts until pg&e and electricians and experts arrive on scene. they guide the actual fire

suppression efforts. many instances, the best path is to allow the fire in the vault to burn out. pg&e can deenergyize the vault. if you allow the fire to burn out, pg&e can access the vault and make repairs quicker then if we are to use our co2 units, which fills the vault with carbon dioxide, displacing the oxygen, smother the fire, temporarily. the issue, it doesn't take the heat and energy out of the fire so when the co2 dissipates the fire can start burning again. secondarily, because it depletes the oxygen, you have to clear that environment before anybody can go and work on repairs, so that is why we delay putting co2 on the fire initially until we get guidance from pg&e. there were no injuries associated with this. our service time was probably in the area of hour and a half

total that night. one item of note, the co2 units was not available. it was out of service that day. gone out i believe the day earlier, detected a leak in the station, we can't leave it-as of now it is still out of service awaiting repairs and that is a synapsis of what we did that night. >> thank you chief postel. i appreciate this getting those facts on the record. do you know anything about the april 29 small er fire incident? >> i don't have any details on that one today, no. >> i went there and happened to be driving by when the got the message from the chief and detoreed over there and took photos. they were pumping smoke out. it was down the street on sampson and the co2 truck was there i saw with my own eyes. but thank you for your work that night and every day to the working men and women of the san francisco fire department. we appreciate you.

thank you. next i like to call up the director of emergency management for the city county of san francisco, mary ellen carol to talk about the emergency response in the aftermath. mind you, in addition to the power outage that went from about 9500 customers and sh rank over the days one customer but 1250 units and 2500 people we also had station 13 without power, we had our central police station without power, we had many intersections along the embarcadero all the way to broadway, all the way to polk street that were without traffic signals. some 17 of them persisted for days after and in that time

period the department of emergency management stood up their emergency protocols and with that, mrs. mary ellen carol. >> thank you supervisors. thank you supervisor peskin, thank you-mary ellen carol executive director of department of emergency management happy to be here today. yes, in factoring the most recent april outage, we did activate our emergency operation center for all the reasons that the supervisor just described. it was a complex incident that impacted many different areas of the city, residential, business,b public safety, transportation. many of our city departments therefore and our community partners came together to mitigate those impacts of what was to become extended power outage. pg&e had a critical role in the response and actively participated in the

emergency operation center. i want to recognize pg&e did provide backup hower to public safety facilities in the impacted area. their crews worked around the clock to repair damage caused by the vault fire and to restore power. at the same time, i wanted to come today to discuss some of the challenges that we experienced, and while noted by chief postel, we understand that repairing utility damage and restoring power is complex, and has unforeseen challenges, but what we are asking for from pg&e is provide more timely accurate and transparent information to the customers and to us as a city that is manage the overall impacts and trying to mitigate those impacts. while they are working to bring power back online. and we also have questions about what they are

doing to help people who have while they are offline without power. we know pg&e invested many resources in public safety power shut off events, psps in the bay area, and we in san francisco are not a prime area for a psps event, however due to our density populated city and significant impacts to these type of extended outages that have become realty in the city, we hope pg&e can invest having some of those resources for psps customers more readily available for san francisco. i also wanted to mention that there have been impacts of power outages of city facilities, particularly effectsing public safety, so the department of emergency management operates our facility on turk

street which house the 911 center, but also the city main data center and our emergency operation center. so, this facility for which i'm the steward is the nerve center of the san francisco emergency response and communication systems. i'm very concerned about the impacts of outages at the turk street facility, and while we have been investing redundancies and backup plans, these power outages create instabilities in our system which are really unsustainable and especially during any extended outages. most recently we had pg&e outages in october and december of 2022 which really did threaten our critical city wide safety and security systems. converting to jen generator power

which thankfully the sit a ehas significant backup power, but any time we do that it is introducing great risk and at least one of the situations did impact our ability to provide communication through the 911 center. so, the proximity of the events to one another lead us to consider this grid power as unreliable right now and we are really forced to look into local investment in contingency systems and processes and i want to say, due to a lot of-all our budget constraints, we do not have the funding even for basic maintenance in many cases of our building not related to power. this is a really additional burden that causes me great concern about how we are going to address it. anyway, i'm look

forward to discussion today. i just finally want to acknowledge we do have representation of pg&e and eoc which i do appreciate very much. what i found is that the sometimes the individuals representing do not have connection, they don't have the linkage or the information that is really needed in the most timely manner for us to know what is going on, to be able to pretear ear prepare and communicate so hoping we may be able to find solutions to problems also. >> mrs. carol, in the previous events you are talking about relative to the nerve center of the city emergency communication system and we'll talk to public health in a moment about the incident in march where our general hospital was without power for the better part of a

day, are there-does pg&e do after actions? do they report to you to your knowledge about what happened, what went wrong, what the-? is there ongoing relationship or communication that you have expressed frustration about is optimized or how does that work? >> i will let dph discuss. we had a meeting yesterday my staff participated and will let dph speak to it. we are absolutely having follow-up with pg&e, which is really important. again-and i'm looking forward hearing more about that, but my concern is i'm lead the first response for the city. when we have events where power is out for whatever reason, even if it's no apparent reason, we

need a very close high level contact within pg&e that we feel confident in that we know we are getting the most timely, the most accurate information at the highest level and that is through our emergency operation center and that has been lacking. so, we have contacts, but we are not getting the information timely and we are not always getting the most accurate information we find out after the fact and that is what we like to resolve. >> if i were to ask you now, i know who to call at fire now. i know the protocols of what happens if there were a major earthquake. been through the trainings and member of the disaster council, do you know who your point of contact counterpart is? right now could you say if i needed to garner that information, we had a 7.8 magnitude earthquake and need to reach to this

person at pge do you know who that person would be or deputy would be? i can't find you, i got to look for adrian. >> that has been lacking and i have been in this work for 18 years now. i was security at the puc for 8 years so very involved and i think there is changes and we are not always-for me, i don't have that level of contact that i used to have if i'm ever able to get in contact with. >> thank you for your candor and just one other question, which is, in so far as when i attended those-the emergency operations and gathered together and by the way, very helpful meetings. being there in real time and knowing that central station couldn't use their laptops and that all the things happening and all the troubleshooting being done and it was very impressive

and checking back in at the end of the day and checking in the next morning and checking in later thin day and getting real time updates from you guys throughout the day, that is exactly what incident command is all about. are you the central coordinating point for claims from all of these city agencies? not yet dealing with the private side claims. do those all go to you? >> that would be through the city attorney. and just to your point, these events, yes this is as the department of emergency management, this is our job, but-and, we are as you well know, because we are in here all the time a very busy all the time. these incidents require my staff to work all most 24/7. they work through the weekday. it is a

large resource of city personnel and time, not only from my staff quhoo who is leading this, but the other departments pulled from other critical priorities. obviously these things happen. this is sometimes cant be avoided, but it sure would be helpful i think anything we can do to make the response more efficient for all of us as we are all dealing with sort of theoretical fires constantly. >> understood and appreciated and thank you for your work. >> if i jump in before you go to next presenter. i really just want to thank you director carol and your team and particularly olivia scanlen for being that point of contact and just to underscore because we have major outages. march was certainly the big one

with thousands of people with questions and i think the limitation on you of getting that information from pg&e i'm one step removed so rely exclusively if not getting a timely response from pg&e from you, but more importantly and think the reason president peskin called for the hearing is our constituents. they are three steps removed and say in the march extended outage, there was not a lot of information flowing from pg&e. what update s got, the customers was vague and often not accurate and want to recognize you and your team were immediately responsive and then trying to get that kind of information, which was extremely helpful, but that system obviously is not sustainable for anyone and i think we all know some of this is convenience and some is life and death out there for people as well as for a lot

of business owners. whether your power is coming back in 4 hours or 8 hours is the difference between replacing everything in the case versus save it. people are making business decisions, medical decisions and others based on this, so i just want to underscore, very much appreciate your and mrs. scanlen and teams responsiveness, but it shouldn't be this hard for you or us or the customers to get this information. >> we lose a little like a year or 2 of our life from the stress of trying to get the information. the final point i would say is we need to partner with pg&e. we will be making policy decisions in much larger events about where we need to focus resources. where we need to prioritize repowering if that is a choice. sf general is probably pretty top of my list in any major event like a earthquake or flood or

something that brings out-so, that's why i'm looking for that partnership and the right people within that organization as i with any community partners who has the decision making ability who we can say okay, we got power out in the entire city, here is our priorities pg&e, can you do that? because in these catastrophic events, the city has to be at the table and really driving the decisions working with pg&e to hopefully figure out pg&e telling yes we can do that, here's the trade-off. appreciate you bringing that up. >> thank you chair preston. we have a opportunity to visit with pg&e and appreciate their coming and attending today. the issue of communication is paramount. whether we can control a transformer blowing up or not. i attended

all the eoc meetings and hear things and understand when you have a big fire and think you can fix it in 24 hours and turns out to be more complicated and trying to do work-around and route power in a different way, that 24 hours can become 48 hours, but what was interesting to me is i was learning things that were communicated directly to the golden gateway that we were not learning in the meetings. i would hear certain things and then i hear completely different things relative to expected timing even though when we were in the eoc meetings there was a pg&e person present and i would get a e-mail from anthony at the golden gateway which tell a separate story on saturday, i was looking at the san francisco chronicle online and thought, wow, this story does not jive with my experience, my e-mails and telephone calls

which is that 2500 of my residents don't have power, don't have water. having to go to hotels and this and that, and so i called up the reporter and i was like, i don't know how you could write this story about everything is okay. i said, did pg&e misinform you. he said i got this from the pg&e outage map. i looked at the pg&e outage map, which by the way wasn't inaccurate. it was accurate, but it had one little yellow dot, which yellow dot represents 1 to 84 customers. well, one of those customers is the 3 blocks that is the golden gateway apartments with 4 high-rise buildings and 1250 units, but it looked like they were down to one customer, which would be like one person, and there was no way-the reporter obviously no offense hadn't done

extensive homework and came to the conclusion everybody is powered up when 2500 people had to walk up 25 flights of stairs. i also want to say that station 13, which is our high pressure downtown high-rise fire station at 530 sampson street was without power most of the 120 hours and they ran their generators and eventually as happens in real life the generators expired and they appealed to pge who did bring in-thankful backup generators to run that thing, but i just trying to impart how much our society relies on this stuff called electricity, particularly in the day and age where it is medical devices, it's not spoil food, elevators, pumps that lift water so a pretty fundamental part of our

existence in the city. i met with dr. jan (indiscernible) this morning the ceo of chinese hospital, the last independent hospital in san francisco who told me on mother's day for one hour-this is a hospital with people on respirators their power went out. fortunately they were able to turn on backup power. the same thing happened at san francisco general hospital in late march, march 26-27 and ref erenced in the letter mayor and general herrera (indiscernible) wrote to pg&e but i

want to give dph to speak to that event which is literally life critical >> thank you. clinical operations at zsfg. we are here also with terry-terry are you go ing to start? >> sure. thank you for having us today to report out on this incident that happened in march. our event spread across two days and started off early around-we started to see momentary blackouts and had three before we decided to put the system on emergency generator to provide some stability. about 11 p.m. that night the power went out for

exteneded period and did not return back on until later the next afternoon around 3:30. the effect of that power failure varied wide throughout the campus. we were able to maintain patient care in most areas that were fed by the generators minimal power needs. did not keep hundred percent functional, but through many efforts by zuckerberg staff, we were able to keep operations operating in a (indiscernible) an example of items that were impacted throughout this period of time were medical equipment power failures that required manual intervention where the ed x-ray and ct, the

mri cooling systems, vaccination refrigerators had to be relocated, automatic temperature control, vaccine clinics had to be closed. charter and medications scanners were not operational, (indiscernible) requiring food to be disposed. cooling systems impacted. operational areas such as the or pharmacy was without lighting. (indiscernible) failure security access system failure. a host of systems impacting our clinical labs, outpatient and elevators were out of service. with all these failures i need to echo what is said today and that is the need for better communication with pg&e. there was a period of time where we had the failure at 11 p.m., compete power failure and we didn't

have clear communication from pg&e till 9:30 the next morning. had we had better communication we could have coordinated some of the impacts and maybe possibly reduce the time we were out. it wasn't until yesterday we learned there was adjacent circuits that were being-they were trying to place in service, which we think contributed to a secondary failure of a power pole that was on our campus causing a-reported the power pole was on fire, but it was a-the disconnects on the pole failed. there was a secondary failure due to ongoing power transfer. improved communication would definitely support us in a

manner that shorten the duration of our experience. >> let me through the chair ask you the same question i asked mrs. carol from the department of emergency management. in the wake of the march 26, 27 outage you just described, and given the communication breakdown or failure was there any after-action meeting with pacific gas and electric as to how to optimize this going forward and have better communications or can you characterize that for the committee in any way? >> pg&e had reached out and met with facility staff, facility service director and there was a larger meeting that happened yesterday, which i took place in and at that time we

talked about improvements. >> seems like a lot of meetings happened yesterday. you haven't had a meeting yesterday and dph had a meeting yesterday. coincidental we were having a hearing today. i dont know. and can you characterize what the lessens learned and what promises were made relative to facilitating better communication (indiscernible) that you sustained? >> pg&e suggested making improvements to being able to monitor the circuits. they want to install equipment that enhance monitoring capability. we talked about possibility of researching providing power to

the campus, and we also scheduled a follow-up meeting to continue these discussions. >> and this is-sorry i cant see, you but this is terry speaking , right? >> correct. >> mr. salts i want to ask the same question i asked mrs. carol which is, do you know who your point of contact is at pacific gas and electric in events such as you experienced on march 26 and 27? >> yes, we do. we do now know. >> you do now know but did not know then? >> correct. >> colleagues, any questions for the department of public health? thank you for your work. why don't we go on to our public utilities

commission, michael himes is here who is director of clean power san francisco, and is going to speak to maintenance of infrastructure, which seems to be where all roads lead. >> good morning president-chair preston and chair peskin. mike himes, deputy assistant general manager for power enterprise at the san francisco public utilities commission. i do have prepared remarks for the committee on this hearing. as you know, supervisors our sfpuc operates three essential utilities. we provide the city with water and sewer services, and we also are the city power provider. today the sfpuc serves approximately 70 percent of the electricity consumed in san francisco through hetch hetchy power. the city full service public power

utility, and clean power sf. the city community choice generation provider. both of our retail electricity programs rely on the pg&e owned grid for the delivery of that power. hetch hetchy power pays pg&e approximately (3) 500-0000 a year for its service while clean power sf customers pay approximately $350 million a year for electric distribution service on the pg&e bills. it wasn't just electric services interrupted on april 26 and 27 as you noted president peskin, for san franciscans effectsed by that particular pg&e outage water and sewer may have also been interrupted as well. that is because as you noted in taller office and residential buildings, electric power pumps are used to move power and sewer in and out of the building. for those

folks no electricity means no water to cook, or keep clean with and some cases they may not have been able to flush the toilet. we empathize with san franciscans effected by the outage and all outages. at best it is inconvenient, at worst it is health and safety issue. we need a reliable grid to meet the water power sewer customers to provide the essential services san franciscans expect and deserve. we recognize service interrumgzs will occur. we also understand the importance of communication a theme that has come up several times already here during and after such interruptions can customers and others supporting the community effected by the service interruptions. all powers in san francisco are

dependent on the pg&e owned electric grid and as has been noted, pg&e has the outage and estimated restoration information, so it is in control. pg&e must do better working with us and partnering with the city. that means during an outage but also afterwards and identifying where the response to outage can be improved. that concludes my prepared remarks but happy to take questions you may have. >> mr. himes, i appreciate your prepared remarks. in so far as we produce our own electricity up country coming in the form of hydro power from moccasin and early intake and the tuolumne river watershed and we transmit that power all the way until it hits pg&e

infrastructure and local distribution system, do you have any industry data you can share? i did not prepare you for this so understand if you don't have it handy, as to the number of transformer vault failures industry standards whether we are experiencing here is more or less? do you have information you can share? sorry for not give you a heads up. >> unfortunately i don't have there information handy but happy to take back and rorth back to your offices. >> so, i am not making this up, but as we are having this hearing i have now heard from chinese hospital from our department of emergency management that as we are sitting here the power has gone out in china town. chinese hospital is without power. i can't make this up. i

did not this happen as we are sitting here speaking. there are people who now cannot get into buildings along grant avenue because the key systems don't work and they can't get in. that is happening as we are speaking. i'm happy to say that chinese hospital backup generators are working and power is back on in the hospital. i'm not going to start crying. why don't we go to pacific gas and electric and we share the first name, aaron johnson, no relation to angela johnson from golden gateway apartments who is regional vice president for the bay area region. thank you for coming here today and feel free to make some opening statements. let me just say from the get go, i know that there are dynamic tensions between

pacific gas and electric and city and county of san francisco. my interest in this today and going forward even though we have a long standing interest in acquiring and your company has been very clear that you are not interested in our offers, i want to put that in the parking lot for as long as we as you are the utility provider in this territory, my sole desire is to optimize our work together to deliver for our constituents whether they are residents or businesses, the level of service that we all endeavor as we are in public facing businesses. whether in government or whether you are a private utility, whether we provide water and you provide power, these are things of the commons and my interest today

is not attacking pg&e, but figuring ways we can communicate better, understanding what kind of infrastructure challenges and differed maintenance and by the way we know a lot about differed maintenance because we have differed maintenance too, so i want to set that tone and then turn it over to you and i have a number of questions, but mr. johnson, welcome. >> thank you president peskin and chair preston and i appreciate those comments. aaron johnson, regional vice president of pg&e to try to do what you are describing which is provide a more local presence for the comp and local leadership to help improve operations and overall the customer experience. i will go off my prepared remarks and speak to the chinese hospital incident because i too am aware of the incident. as the third time in the last about 10 days we all very short duration outage. they are

switching going on now. they should be back in power within the hour. we had several very short duration outages there. we had a engineering team walking that circuit yesterday to figure it out because in the previous two instances we have not been able to notify the cause of the outage, so they are in the process of switching to a new circuit, so they will be on the circuit and we'll continue our investigative effort to figure out what is not obviously wrong with the circuit but embedded because the hospital has been tripping. we take that very seriously, and we have a ranking system within speaking to the department of emergency management, they help us create that list, then we have a list of the highest priority facilities and that is one of those at the highest level for us. so, i think i introduced my self. i'm a 25 year resident and live in

the sunset district here with my family, so very invested in san francisco. first of all, start saying we understand power outages are disruptive and like to provide 100 percent reliable power. we know that is not always possible but that is our goal. we know there was real hardship for some customers in these outages. that is why we strive to support customers during outages and work around the clock to restore power as safely and quickly as we can. let me turn to the specific outage. it happened began of wednesday april 26 and effected 9144 service connections and say service connections not customers for a reason. that is ultimately meters and think there is a longer conversation to be had about what is behind the meters. because there are people behind the meters. we are conducting a investigation-let my say the majority of the

customers 94 percent restored within 24 hours. that next day late morning. the remaining 500 or so customers experienced extended outage and restored saturday april 29 and there final 7 service connections restored on sunday, april 30. we are conducting a investigation into the incident and we are happy to provide more information when it is available. the long-term repairs needed are still ongoing. everyone is back in service but some of the redundancy continues to be repaired. there will be night crews out and that should be the end of it and they have been working pretty much continuous since the incident. regularly scheduled annual patrols and inspection were conducted on the effected equipment operating within normal parameters. pg&e trouble shooter on site within 15 minutes from our dispatch to assess the

situationism we had up to 16 crews work around the clock to restore power which was recognized by many residents in the areas and they received a lot of positive words and appreciation from the community as frustrated as they were by it power being out. we activated and say those crews came from both our san francisco division, harrison street yard as well as from our neighboring division to the south, peninsula division primarily in san mateo county. we quickly activated our emergency operations center at the harrison street yard. that follows the incident command structure. staff are training in ics and we follow those protocols in incidents. i struggle because sometimes i feel like in these incidents we donts always know right away what the root cause is or how the outage may last. these are

very dynamic situations. we strive to provide the best information we have as we get it. we activated our customer strategy officer position who managed our customer response. activated net work of 11 account managers. one account manager logged over 200 contacts with customers during the outage period. they were very busy and very connected to the customers. we were communicating regularly with san francisco department of management and supervisor preston your office. we logged 50 contacts with this outage with those two entities and participating all in the calls lead by san francisco department of emergency management. we communicated with customers directly and explored providing support including backup generation provided in a number of instances. in other instances it was infeasible to do so because of where the switch gear is located often

very high stories. finally, when the last outage occurred and we became more visible to effected single room occupancy hotels, we had in language support on the last day of the outage and water and did provide food vouchers for over 500 food vouchers. we shared information with impacted customers and are property managers about the claims process for longer duration outage jz happy to support them as they go through that process. i want to share that one reflection for us is clearly this issue that you already highlighted president peskin around gaining greater visionability to the customers effected behind the meters. we like to work with the city and community to insure we have the visibility because we don't have it in many instances. into the customers behind those master meters and i think there is a opportunity with single room occupancy hotels,

we know sro house some of the most vulnerable residents in the city and that seems a great place to start. we need your help to be successful at that. so, with that, i expect you have a number of questions and happy to answer to the best of my ability and look forward to the discussion. thank you. >> thank you mr. johnson. just so you know, this city has a long and robust history around dating back to the 1970 and 80 around the retention of single resident occupancy building typologys so there is a wealth of data that resides at our department of building inspection. we know where they are, we know how many units and we would be more then happy to let you know and when i was looking at some pg&e maps, it looked like even though we are in 2023 and we have

super sophisticated software and digital data that it looked to me and not expert, but that the area that call it zone c2, which is zoning -includes the golden gateway did not appear to show as residential. it looked like the way you looked at it might have been commercial even though the buildings have been there for half a century. as colleagues are well aware, pg&e isn't reg ulated by the city, it is regulated by the california public utility commission and i delved through various regulatory structures and realize there are 5 emergency activation levels in pg&e

emergency response plan, and just wanted to understand what the classification level for this event was? >> i don't know which classification, but it would be-it was a single activation of our emergency operation center which tends to be the lower end of the scale so did not open our regional emergency centers, which for us is the inner-bay area, alameda, contra costa, san mateo and san francisco. that is the next higher level and then the highest level is if we have our emergency operation center open as enterprise so believe one or two, but dont know all the differences between the two. >> i think probably one is the way i read it, but and then was this a as defined a reportable incident that would require submitting a detailed written report to the california public utilities commission within the

required 20 day timeline? >> it is. and there is a number of criteria that are applied, including media interest in an event as well as the extent of damage, which i believe is $50 thousand threshold, but it is not-we dont often know that, so but certainly in this case was there media interest and that is what we used as the trigger. there were probably other criteria that could have triggered. >> i noticed and thought it met that criteria. are you willing to share the report with the supervisor and the city? >> we will be filing that report at the end of this month. it is 20 business days so believe the 26. i am very interested in sharing the general findings of that. i can't commit in this moment to say there wouldn't be something confidential but my objective is be as transparent as possible about what transpired so i definitely- >> thank you, we look forward

seeing it or as much of it as you can devulg. do you know the equipment that ignited and i assume but dont know that it was a transformer? >> we don't yet have the results of the-of what transpired. i can tell you what was in that maintenance hole. there were tie lines that go from the embarcadero substation, which is over on folsom, and then they come to station j, which is right there [multiple speakers] so it is sort of like a intermediary substation for us, so the tie lines that provide power to that intermediary substation that distributes to homes and businesses, so there was nat in there as well as

network transformer in there and possibly other equipment as well. >> and does pg&e monitoring systems provide notice about unusual conditions? >> so, there is a scata systems on the equipment. for the transformers, we are in the process of installing scata equipment. in the downtown network the triple redund ant systemt tharuns up and down market street from embarcadero to van ness, both south and north of market mostly in the financial district area, it is triple redundant, the most reliable system on part of pg&e entire system. so, that network gets extraordinary scrutiny from us. as mentioned in the comments, the lines are patrolled annually, subject to every 3 years detailed

documented inspection, and then for the 1400 transformers that are part of that system, we do a annual inspection on them to make sure they are operating within normal parameters and then we are in the process of installing additional scata a monering technology on the transformers, we are at about 50 percent and we will be able to do remote monitoring. today we dont have it on all the transformers, but when the program is complete we will have that. as well as over the last 15 years, we have been doing a few things like we replaced all of the liquid filled transformers on customer premises, so not in our holes, but in buildings. any liquid filled and that is generally oil based and replaced with air base so went through a 15 year program that ended

last year and taken all of those out of service that are on customer premise, so that was a safety priority for us to focus there first. >> then you presumably move to things under' >> under the street and that would be part a long-term plan to replace the transformer infrastructure under thereism i will say that our approach to replacing that infrastructure is really focused on what is the performance of the infrastructure. there are not aged based criteria we use to determine when something should be replaced. i would make the analg to a bridgeismt we dont decide perhaps the golden gate bridge is too old and replace with another bridge. we look at integrity so monitor integrity of the cyst system and decide what equipment needs to be replaced. >> but out of curiosity, thought is the vitage of the transformer in this particular vault? >> the transformer in this

vault was installed in 1984 and that is about at the end of if you are-there are some installed as recently as last year and that is towards the end of the oldest ones. >> was oil based and not air based and presumably- >> correct. >> as you were starting to change those out go to air based. and after the fire was repair work continuous through the nights until the power was restored? >> it was. it was. >> was the material or equipment needed for the repair that pg&e did not have a-did you have all the equipment that you needed available locally or did you have to go afar? >> i did not hear anything from any of the crews and i was on all the calls we had any equipment challenges with getting what we needed for this. >> i know in the

incident emergency incident command conversation there was talk about rerouting-did you replace the transform er in that vault or- >> we have not replaced the transformer in the vault. we switched customers to other transformers so we want to complete the investigation before we replace that piece but the customers have the resiliency and redundancy. the tie lines that run from the substation on folsom at the base of rincon hill there is to station j. we ideally like to not have all those lines go through the same maintenance hole. we looked to reroute them during the repair process. we were unable to do that. we did test through the various streets in that way and there is no clear path.

when you look at all the other utilities in there that would have allowed us to do that, so once we are complete with our investigation that will be one thing we have to continue to look at, an entire rerouting through that particular part of the city would be very very challenging, but certainly something we want to look at. >> can you help us understand how-i was-the power went out, delighted when it came on mid-day or 11:30 in the morning the following day. why you were able to restore the first traunch, second traunch relatively quickly and why the remainder which happened to be the master meter customer that is golden gateway apartments and town houses and sro on clay street-not guilt tripping you here, but sunday china town non

profits were literally driving these elderly individuals to the china town ymca to have showers for the first time in 4 days. that included thank you calvin chan my staff who speaks cantonese and helped 80 year old folks go get showers. can you explain why those customers were not restored for 4 day s? >> yeah, so the-as i mentioned, it is called the network for us. it is san francisco network. it's a pretty-a common system that exists in the older parts of many american cities, and we have a small version of it in oakland and there are the only two in our system, but it is designed to provide a very high level of redundancy, so you have three sources of power into

every building, and that triple redundancy is basically a spide r web of lines that go out from the substations and that allows there many different routes for power, so when you is a incident like this, our challenge in this instance was the source of power coming in, so all that was down. we were able to because you have all this interconnectedness in that part of the city, which is much different then you see in a rural area where there is a single line serving a community, we are able to switch power. we usually need to do engineering analysis to understand an outage of this size whether it can handle the load and we dont want to cause additional damage on other lines. luckily this started drifting into the weekday, end of the week, change

usage pattern weez are seeing post covid and that helped us be able to-frankly one of our technicians one of the crew members who previously worked in the control center came up with a idea. we initially dismissed this idea and he was actually the hero in this for us because he pushed through and we looked at it again and were able to find a way to reroute power into this area and that's what restored the vast majority of customers. the initial repairs were then made two days later after we got most of the customers back in power so the additional 500 or so required the repairs. we isolated the damage as small pocket we could and then reenergized saturday evening. there was a incident where there was a secondary piece of wire that had been burned up in the original incident that they did not find in the

original repairs, and that was the cause. there was no issue with it, but that was the cause of that second fire that came on saturday, so once that was out we were able to put that back in the clear. they went in after the fire was put out, thank you to the fire department, and we were able to go in and within the hour cut that in the clear and restore all those customers. however, that secondary piece of wire did contain a handful of customers left. meters. not people. meters, that were connected and it was that last final repair that was needed on that line to connect those final customers who experienced that last day of outage that went into sunday. >> shifting gears to san francisco general hospital, i know that potrero is not rural, but maybe doesn't have triple

redundancy. can you run us through the same thing starting with whether it was a level 1 or 2 where it was on the 5 and whether it reportable incident and if so, if we can have a copy of the written report to the cpuc. >> don't believe that there was a electric incident report on that event. that occurred and i'll go from memory here, i dont recall the level of activation that was a very major storm poord. period. we had one of the most impactful storm periods in pg&e history, the biggest since the mid-90. typical number of customers out were 30 years average by april this year. a absolute anomaly of a weather year as we all experienced. the incident with san

francisco occurred with dozens of out jss outages in the city. the after action review that was scheduled several weeks ago for that event and it may look coincidental to you, but would assure it is in the works for some time, and so in that instance we do have two feeds for the hospital, and as detailed in the after action review yesterday which i did not participate in but got a report out from this morning, i think we have some positive actions we can take forward, but one of them is that the redundants feed to the hospital doesn't provide a full capability for the hospital to operate in entirety and i think there is long history, which is unfamiliar to me, but i heard that there is choices made not to have a second feed that can fully support that

hospital for-into sf general as well as 911 center, so i think those are things coming out of this discussion i would be interested in working with the city on. those are not free, but given the facilities the best practice is have a second fully capable feed into that and there are circuits very close by capable of providing that additional resiliency to what i think are probably two of the most critical facilities in the entire city. we would welcome work wg you on that. i would say there were lessens learned for us in that event. we were very overwhelmed by the amount of damage on our system and amount of wires down in the city and we make very hard choices in the emergency operation center whether to send the next trouble

shout r shooter on a call to a downed wire in a public place that may or may not be energyize versing sending out to work with a facility out of power. ultimately, we made the choice to pull crews off of down wire incident to send to resolve the hospital issue because we recognize that priority for the city. if i could learn lessens from it, i would have made that choice sooner and helped the teams make the choice sooner, but i also understand the human beings that made that choice were faced with tough choices in that moment. >> the big storms were on march 14 and march 21, and i know there were a lot of down wires, some of which crew vehicles drove into, but not dealing with that. this is 5 days later. let me ask you

this, what was the cause and origin? was this a transformer? >> so, the cause of the outage was a city owned tree falling into our lines. >> and so and that happened subsequent to march 31 storm and happens several days later? >> i don't have that detailed timeline in my head or in my notes, so i would have to-happy to snd you something that sort of follows that up, but that evening there were many outages in san francisco. that was a storm night. >> relative to after action protocols, are those done with department of emergency manage agement or public facility? >> that is area for improvement. we struggle how to engage with the city. we have designated contacts. i

heard a number of folks express that they dont know who to talk to. we have a designated liaison to for blue sky and event days for sfdem and the same individual conducts training with san francisco fire department for incidence so that person is well done and in regular contact with dem staff, perhaps not the director but pretty much on speed dial for those folks. we have similar process for hospitals. as a critical facility we have a 24/7 customer support line and account rep who serves them for blue sky days. that person isn't on 24/7 calls so we have a 24/7 number for all customers who have account managers as well as one that is expedited for a critical customer including a specific one for san francisco, so

those numbers are widely shared and generally known and haven't changed in years, so perhaps we need to do a little more to help people understand what they are, and perhaps those organizations can do a little more to help share those numbers and be knowledgeable around what those protocols should be in incidents. in terms of after action reviews, sf general is not our customer actually. it is the city customer, and so we struggle with that relationship. should we work through dem or sfpuc sore individual customers? it isn't always clear to us how that works. we work a lot with the sfpuc for planning purposes, but when it comes to emergency management they are much more hands off and see us as the service provider and tend to engage directly with

my experience and team experience they may have a different opinion on that, but we end working much more directly with the customer. i communicated desire to do after action review to barbara hail, the head of power enterprise at the sfpuc, talk to staff about getting that set up and they set it up and did that unbeknownst to barbara and i and was scheduled and set up and that included folks oen the sfpuc and dem staff invited to the event held yesterday. >> yeah, i mean kind of amaidsing amaidsing we are in 2023 and you are headquartered here a century and we haven't figured this out. i would be in-more then happy to sit the puc and dem and fire

and first responders down with you and if we need to hammer out a mou so the protocols are just crystal clear. it is just kind of mind-boggling we are not all on the same page around something as critical as keeping our hospitals and fire stations up and running and who is supposed to call who. if there is a reason to have a hearing like this it is to figure this out. i appreciate getting a call yesterday from a lobbyist who indicated that you wanted to brief me about plans to invest i think she said $2 billion in infrastructure in san francisco, so presumably that includes transformer replacements in the public right of way and what have you. which i guess is--an acknowledgment that

some of that equipment has reached its end of useful lifespan. you represented that pg&e has taken steps to check out its equipment. can you just tell relative to actions going forward what steps you are taking to prevent reduce similar incidents? >> i think it is hard to stand here today and tell you exactly what the actions are that we should take to respond to a incident we don't know the root cause of yet, so i think we will wait and see that, but infrastructure investment is never ending process. i feel like electrical equipment is sort of like the painting of the golden gate bridge. as soon as you are done you start all over again so there is no end to that cycle. again, to be good stewards of customer money we want to invest in equipment when it is at the end of useful life, not

just because it hit a date and so that's-we take that risk based approach and that assessment based approach to how we choose to set that investment schedule, but yes, there is much investing to do in san francisco and much we have done over the last several decades in particular and i'm proud that-you can go back to the causes, but both mission and larkin substations are some of the best conditions substations we have given investments coming out of some of those incidents in the past and we have plans for and have completed much of that $2 billion wurkt of investment over the last couple decades and through 2025 so continual source of investment for us. i like what you said, i like to fix stuff, i'm an engen ear. the local teams are asking

aaron, in this role help work better with the city, get permits faster, help us get permission to do some of the work we want to do and i really appreciate the olive branch because there are opportunities. this is one of the most challenging jurisdictions for us to work in. there are oo lot more people around when you fry to do work. our underground crews work only night shifts because of that, and there is a lotf of challenges in san francisco. we have standby bio hazard teams now for all of our underground work because they come and clear the needles and feces out of the holes before folks can go in their safely. that is a cost of doing business here we dont have anywhere else on the system and it is a challenging environment and yet they love to show up and fix stuff and part of what we could do collectively together i think is find those ways to work together better. i recently worked

jointly with head of dpw and we were able to clear some work that they really needed us to do to move forward with their work and get that moving and they were able to help us with a process to get permits faster. we put our heads together for about a month, got teams together, built trackers, built regular cadences and everybody walked out feeling good about the way we were working together and that is the thing i love to replicate. >> let's do more of that. before i call on golden gateway and i know i have long since exceeded the patience of my colleagues on this panel, thank you mr. johnson. mrs. carol do you want to speak to the after action reviews and i think this does fall squarely in the realm of dm and i will reiterate my my offer to convene your organization, pg&e, public utility commission, department of public health and fire

department and first respondsers so we can have crystal clear protocols in place. i acknowledge that there is representation in our emergency operations center by pg&e personnel, but those are not decision makers and there should be very clear lines of communication between our senior emergency leadership and the decision makers within the pg&e organization. any observations from you mrs. carol? >> thank you supervisor. i appreciate hearing from pg&e and their perspective and all the work that they do dealing with these very difficult situations. as far as ar, we do have after action reports. we held two after action conferences. i'm confirming pg&e participate and they were invited and we kaess the issues in our reports. our report for the january storms is just being adjusted because it is sort of never stopped

raining so we folding march to the january report and that should be relaced shortly, and for the extended power outage that most recently happened, we had a conference may 10 and about 3 quarters the way done so that should be coming out and should be a good pathway guideline for us in following up on what we need. and then i just are want to say, we do have someone on call. that person is unable to provide us with information and not a decision maker, and so while that person has a role in what we are doing and at a certain level, we lack what you describe and i think that as mr. johnson was talking about the sfgh, i too agree that i think we would have moved faster overnight to

switch priorities and my frustration was i couldn't get to someone who could make that decision that evening. it is crystal clear in my mind. i have ptsd from those hours because the concern of having our only trauma center for the region out of power and the folks impacted was significant. so, they are here, we just need that higher level and we want to be able to make decisions like this together. it is critical, so i appreciate the opportunity for us to be here to hear each other out and look forward to resolving the issues quickly. >> thank you mr. carol and thank you for your candor and punt intended i will take this off-line with you and mr. johnson, so that when incidents like this happen and our only level one trauma center that is the only place you go at the northern end of this peninsula doesn't have power that we can

make real time decisions and walk away from other down power lines and make sure that people who are in the emergency-who are at the-literally in the emergency department of san francisco general are getting the power that they have to have. with that, colleagues i thank you again for your patience and want to go to golden gateway apartments. i know the tenants want to testify and have 7 minute power points presentation we are not go ing to do but part of the board packet and all of us have been looking at it online so i have seen and we all seen the graphs and just to put in 30 seconds, those graphs talk about the fact that people a lot of them elderly who live on the 10th floor and 15th floor and 20th floor couldn't get to their residents. spent thousands of dollars on hotel and food and

transportation to say nothing of the cost as i was listening to anthony and (indiscernible) tell me every day the 10s of thousands of dollars that they were expending to keep huge-i have pictures because i go to the farmer market saturday morning and went pass the jen generators . in the beginning the only thing you had were light wells. i'm sorry for all what everybody went through. angela johnson no relation to aaron johnson and no relation to (indiscernible) the property manager who i have to say for the-in all most quarter century i represented district 3 you have been probably the most responsive and beloved property manager of

the 1250 unit facility. i'll hand it over to you and then go to- >> before you do i want to see if supervisor chan wants to jump in before. >> i apologize. >> sorry, my apologies want able to be here for the most of the hearing, but for what i caught, i just want to add emphasis about muneication channel and how critical it has been. i want to give shout out to pg&e contact i have since i took office. she is no longer with pg&e, her name was laura wilson so grateful to her and been responsive every time we have a power outage. i know today this hearing is specifically about this period, but there were times when in this year too which is that during the storm time that we actually have power outage in the richmond that impacted-we have a veteran

hospital va hospital in the richmond. it too was actually out of power for extended period of time. it is on federal land and have their generator but it was concerning for the richmond as well and not being able to understand what caused it, restoration time and really proximity of the restoration and cover area. those are very frustrating moments and not being able to have real time update, it was cause a lot of anxiety notice there is a lot of seniors live alone. ologist also in the richmond it was not easy but grateful to department of emergency management for actually when i text and say what about now, how about now? they did not find me annoying and say we are trying to get information, trying to get information. i think

that that's unfochinate and regrettable and think it also creates a lot of anxiety not just for someone like us who is trying to help our constituents and trying to making during a emergency situation, but i don't think if we cannot as the representative articulate when and where or how it doesn't give the public a lot of trust in the time of disaster, especially we know that a big one earthquake can happen any moment not able to have these communication channel established in advance and also "rehearsed". it is problematic so i look forward seeing ways to improve that. thank you. >> through the chair to supervisor chan, thank you. i do want to say when you are in our positions everybody is calling you and

whether department or private utility, we expect that we have a contact and like supervisor chan from the richmond, this supervisor contact was lauren wilson who stopped being my contact and this is great because she went on maternty leave and then went on the cruise. usually the organization whether department or whether private utility says mr. president, lauren wilson is leaving and we have succession planning in the organization and the new point of contact is going to be so and so, and would you like to sit down and have a cup of coffee or a meeting in our office or your office and you establish that relationship. that is--i'm not trying to be accuse tore, but that is what i'm used to. that is definitely not happened in

this case. i could-i know there was a gentleman named daren cline who was i think lauren wilson's boss who is quite hard to get a hold of, but that point of contact i could not tell who that person is. and by the way, i picked on few years ago the department of public health that has 6 thousand employees and $2 billion budget and does critical work. me and my colleagues did not know who the point of contact was at that organization and i made a fuss but that and now we all know. i get it, people come and go and retire and move on to other things, but we have to--as long as we shall live together, we don't have to like each other, but we got to communicate. so, with that, to the golden gateway apartment complex thank you for your patience

and for what you and all the residents went through between april 26 and the end of that month. anthony. angela. >> thank you again. first off, we want to thank you board president peskin and also chair president and board of supervisors. >> get close to the microphone. i know you are shy. >> supervisors, for allowing us to talk about our experience that happened april 26. we got a copy of the letter from pg&e to mayor breed written on may 11. we found a lot of inaccuracy you were reporting and what we experienced so we want to make sure we clarify and going forward what had happened and what is the true story of the outcome. >> it is very important to get that on the record. i read this thing and other then the

mistake i made relative to the amount of time that-that was that night in the moment based on what i heard the computer automated dispatch numbers which turned out to be different a couple days later, but i too read that letter and thought this is not the experience that i had and it is signed by the head of pacific gas and electric so very important to get that on the record and thank you for that. >> angela is go toog ask the question pg&e stated in the letter and (indiscernible) >> if you want to use both microphones you are welcome to do that. >> thank you. >> thank you. the first point we want to talk-pg&e mentioned in the letter, the outage the evening of april 26 in san francisco impacted 9454 service connections. >> gateway, it is

under the assumption pge did not account for gateway 1254 service connections that were effected by this outage. i know we sound redundant, however it was mentioned it under master account but with that master account there are subaccounts that roll up, so i'm shocked that it-the subaccount was not caught under this one account. gateway compose of 1196 apartments and 58 townhomes with average occupancy of two residents per apartment. with average occupancy of 2 apartment pg&e failed to realize 2500 resident effected by the outages and 25-30 percent of the residents are elderly that relies on refrigeration for medicine to power medical equipment and elevators services as many are

unable to walk up and down 20 flights of stairs for the first 2 days forcing to shelter in place until generators were installed. this outage caused many to suffer as our water and plumbing was effected by the outage as 8 system is powered by electricity. not to mention the outage effected cable and internet which prevented residents working from home and recharge cell phones and or laptops. >> pg&e wrote, customers received direct communication with estimated restoration time i and update as the repair and restoration process is unfolded. as the event progressed and we relized restoration may be extended we installed the generator at 440 gateway and looked at temporary generation but it was technically infeasible. >> thank you. gateway response to this is, the order

to install a generator at 440 davis court and not 9440 gateway was sparked by a resident that lives in the tower and had connection at pge. a call was placed shortly after learning of the instillation to determine when the generators were going to be (indiscernible) on the call with associate we learned quickly pge had no plans to install generators for the remaining three towers. pg&e mentioned it was infeasible to install other generators technically infeasible or financially infeasible? (indiscernible) able to secure 9-12 generators for the buildings at pg&e felt technically infeasible to do so. the remaining three towers running off generators by early late morning of april

29 without any assistance of pg&e what so ever. we ask pg&e make the residents whole for the harship they had to experience from april 26 to may 1. pg&e reporting gateway was back on the grid on saturday 29. prior to that several text messages received by residents pg&e service was restored. the truth of the matter is the gateway was finally switched to pg&e power grid monday may 1, not sunday late evening. monday. the last building was switched over i believe at around 11 p.m. at

night. it is important to note that the estimated restoration time and updates were not timely. always last minute and never never accurate at any given time during this ordeal. >> another statement over the weekday we had company representatives on site who communicate with customers in language. provide water and food vouchers who remained without power. >> our response is, pg&e was no where to be found throughout the outage and there was no company representatives on site on the weekday. passing out food vouchers and/or water. once again, building management was left to answer questions to deal with highly frustrated residents which many yelled buerated the maneningment staff due to pg&e lack of communication and inaccurate updates. many staff members were exhaust #d by the

streement to the point many broke down in tears a lt the end of each day. this could have been easily resolved if pg&e did have the associate here at the property following morning face our residents and answer any questions regarding the outage. community staff members climbed up and down 20flights of stairs for at least two days with water bottles in hand. checking upon our elderly residents in need of emergency service. many community staff members worked 20 plus hours since the start of the outage. our assistance chief engineer reported to work (indiscernible)

once again, messages provided by pg&e and relayed back to gateway were always incorrect and not the fault of his. in closing, i like to say, unfortunately as a wednesday april 26, pg&e fell short of the mission by building a better california but succeeded dividing a community by lack of accurate update, empathy and support for gateway residents. thank you for your time. >> thank you anthony and angela and again, i'm sorry. i have not--i experienced your and i actually made a folder

in my e-mail for all of the-sorry the people i stop responding to because i couldn't. i was getting too many e-mails from 3,000 people and i was trying to stay in touch with you guys, but i never heard it as comprehensively as this and as you broke down the claims and the on the ground actual experience and just so we are all clear here, this is gray star corporation. this is not like some-not saying-not a mom and pop property manager, this is a major american institution that controls 10s of thousands of units of housing in our country, maybe hundreds of thousands. hundreds of thousands. sorry. to say by way of saying that i appreciate your voracity, and without sounding accuse torry,

i say to pg&e, if that is the response you are getting you got serious work to do. just the notion that pg&e knows because they have to know that there are 1254 subaccounts, that electronic map that you have that shows it as the yellow circle, which then you look down at the legend is 1-84 customers, pg&e knows and should accurately and transporntsly represent, that is 1254 people or twice that much or more. thank you for saying the stuff on the record. it is very important and mr. johnson, i dont know if you want to respond to that or if we should go to general public

comment. thank you mr. johnson. >> thank you. >> so, there is clearly work to do so i want to acknowledge that and i know because i was hearing first hand reports it was traumatic experience for the customers so i want to start by acknowledging that and understanding how challenge it is to go without power for a long duration. there is a lot facts we got to work through and i think it is great to sit down and understand that. i'll just respond to couple things. i checked the account. the account says 3 meters. it doesn't say but we follow up we know there are 1258 units within the building was the number i was given, so we know that, but that's not in our records. so, we dont have the subaccounts, we don't have that. it is listed as

industrial customer and this is a challenge in our system because over a certain load size there is required rate structures for customers in order to encourage conservation so you have to be on certain types of rates. that will mask a very large building as industrial so these are anomalies of the regulatory system we need to work out because they don't feel very people centric to me, but i understand why we do and classify things the way we do. and i'll just say that in terms of i want to acknowledge there is no one at gateway that language in there as i indicated in my comments was on sunday at the sro at clay street. it was not gateway, so no intention implying that but i want to clarify where that was at. definitely have a longer conversation. we were able to provide generation. the only thing i add is there a was a hotel, the hilton asking

for generation but the switch gear was the 11 floor. i think we provided one and apologize for the address error in the davis street error in that because it was-we did provide one generator when you guys built out the generation that you procured and we were able to supplement. we had the single generator there and i will acknowledge it. i have a friend quhoo used to live in the building so very familiar with it and very close to our former general office in the city, which i miss and so-but look forward to conversation off-line to understand it and welcome copy of the powerpoint we didn't get a chance to see. >> it is in the file. you can find it under item 3 under the agenda and apologize

not having time to go through that. why don't we go through public comment. >> thank you. let's open public comment. >> any members of the public who like to comment on item 3? please line up along the wall. remote public call in members, dial star 3 to be added to the queue. we have 8 listeners. if you intend to speak dial star 3 now to be added to the queue. those on hold continue to wait until the system indicates you are unmuted. >> just as first speaker is coming up i want to give a piece of good news which is the power at chinese hospital is back on, and one piece of not so good news, which is that people from those sro's are not sure who the bilingual person was on the last day of the outage. there is no record of that person of any bilingual cantonese english speaker between 8 a.m. and

1:30 p.m. unless they came after that. just for the record. >> thank you. welcome. >> good morning supervisors. or should say good afternoon. my name is bob heron a board member representing the coast neighborhood association also known as bcna. our association represents the people who live and work in the gateway sent. which is the largest and most density populated area in the southern coast region. there is a map of our area. to begin, we are very grateful to supervisor peskin for bringing the issue to your attention. bcna asked supervisor peskin office help two days after the outage began. we fallowed with pg&e and with his support power was not restored by

pg&e until very late monday may 1 for all of the gateway geld buildings. we are concerned about the inaccurate information and lack of appropriate response from pg&e during this power outage. you heard from the gateway tenants association and will hear from or heard from the management company gray star and they discussed the lack of accurate and timely communication from pge to gateway management residents and businesses was a problem. the lack of information delayed the gateway response capacity result was a jeopardized help for people trapped on the upper floors of the buildings. the information on pg&e power restoration website was misleading. this incident

created major difficulties for more then 2,000 people living and working in there gateway center. pg&e must do better. >> thank you. >> copy of the statement i can leave. >> thank you. next speaker, please. >> hello. my name is michele hennessey and live at it gateway a board member of the tenants association and also sit on it board of the bcna as the gateway representative. i like to personally thank supervisor peskin for all he did during the outage and putting the topic on the agenda today. i also like to thank the management and staff for all they did to keep informed the best they could during the event. the gateway worked round the clock trying

to get the power back to us and also tried to communicate to us by e-mail and so for the people that had phones that were charged then we knew what was going on and tried to connect other people to that information which wasn't exactly easy. i live on the 17 floor of 22 story building but was one of the lucky ones. my power cut off wednesday and put on a generator acquired by the gateway friday evening and my building was connected back to pg&e monday. it was so disheartening over that weekday to hear from all the news media that pg&e and major customers had their power back. at that time it felt like that pg&e didn't care about the residents that lived in the gateway. during the time of the outage we lived in a third world country. no food, no

toilet, no elevator. who lives like that in this day and age? i'm 78 year old and live on the 17 floor, i had to walk up down and up twice for food and water and then i also had to go over to one of the other buildings where i have a 93 year old friend i tried calling and there was no way to contact her. >> thank you. next speaker, please. >> good afternoon everyone. thank you for continuing to listen. i'm catherine baiter and live at the gateway on the 25 floor of 155 jackson street with my 86 year old husband who is disabled and walks with a walker. wednesday evening april 26, my 76 birthday the lights went out in our apartment and we got out our flashlights. we soon learned no power at the gateway also meant no water and no

elevators. later that night in the following day we got more e-mails from the gateway stating the outage will last to saturday morning so toilets didn't flush, stoves didn't cook, elvarietys that didn't get to street level, internet that didn't work and phones quickly running out of juice. i did walk up and down the 25 floors once and that was enough for me. then more bad new, pg&e didn't restore power on saturday morning, instead we learned we would went get power until monday. we were devastated. we were living on dride fruit crackers and peanut butter. thank god for the gateway management who managed to locate generators for the building and two others after pg&e said they were unable to do so. even then however it took until saturday fran afternoon to get to us and working. to add to the complete breakdown in

pg&e service and credibility we learn #d pge reporting virtually all service was restored. we never received a single message directly from pge that according to data they have only one or two customers at the gateway. those one or two customers comprise approximately 2500 human beings, but isn't it convenient for pg&e to disregard that fact and use their lack of detail to spin their update d to the media (indiscernible) >> thank you. next speaker, please. >> good afternoon everybody. kevin pritchard on behalf of gateway tenant association, 2500 tenants. i provided these and sounds like you

ingested them so won't dive into too much detail. i just want to say that in the days following restoration of power on may 1, not april 29, we conducted a survey of our member tenants in order to obtain a quantitative assess mentd of what it was like. that is in the slide deck and there is a lot of good information that covers what we experience that 10s of thousands of dollars that were spnt just by the people who responded to the survey, which is a fraction of everyone in the gateway. i would--let's see--so, we just were left with a very strong impression that pg&e suffers from a institutional blindness to the needs of the customers. the fact that there are thousands of tenants at one of

their single meter customers is something they can easily uncover with the united states census database. something that is employed by the gateway tenant association and bear berry coast association to understand our neighborhoods and that should be something that pg&e should easily apply. let's see--anyway, we felt ignored and mislead by pge. no one should have to experience what we did. pg&e has access to tremendous resources and we believe they could have prevented this crisis had they better oversight and priorities. i close by asking the board to truly make (indiscernible) make change and take preventative action. (indiscernible) pass legislation. >> thank you mr. pritchard. >> any other members of the public in the chamber that would like to speak to this item? seeing none,

we have 4 callers with one in the queue to speak. may i please have the caller? >> good morning supervisors. my name is (indiscernible) i live at the gateway apartments [difficulty understanding speaker due to audio quality] we have grateful for supervisor peskin (indiscernible) bringing the issue to your attention. i also like to thank the management and staff for their help. (indiscernible) all in the dark. power is required to provide water to

upper floors. (indiscernible) now water no shower and no working toilet s. (indiscernible) pg&e response was (indiscernible) communication made matters worse. we were lead to be power would be restored in a matter of hours and then saturday morning. pg&e needs their (indiscernible) received any assistance from pg&e. this is a tower with 600 residents one of three buildings (indiscernible)

finally my building was connected back to pg&e monday late at night. this was a hard situation for all in the gateway. we live in a major city, not the middle of no where. i hope you (indiscernible) thank you. >> thank you for your comments today. we are checking to see if there are any other callers. no additional callers in the queue. >> thank you madam clerk. public comment is now closed. president peskin, anything further? >> my profound thanks to colleagues as well as to the city agencies that testified and worked to respond that night and the days following as well as to the impacted

constituents not to mention the many businesses that we have not heard from as well as to the staff from pg&e for testifying and because mr. pritchard didn't say it, but it set forth here,b just based on that survey only for the golden gateway and these are extrapolated numbers based on the survey respondents, just the cost of food that paraished, the cost of meals from out of pocket expenditures for housing for those people who were able to actually go down whether 17 or 25 stories and find temporary housing elsewhere and out of pocket cost for transportation, if you just add those numbers together as a estimated cost of $1.4 million and that doesn't include the 10s of thousands or probably hundred of

thousands that the property manager spent. i do want to just personally thank gray star. i labor under the belief that when something like this happens, you expect that there is going to be this mobilization of resources to come help people in sro and elderly tenants up 20 and 25 stories, and that's why we stand up a emergency operation center to figure do we need to send in people from our human services agency and what have you, and we were doing welfare checks and stuff like that, but you expect that pacific gas and electric would be a part of that response and that clearly was not the case here and it is troubleling. here we are 23 years into dawn of the

not so new century, you would think all these protocols would be worked out. you would think maps would know there are 1254 subaccounts. i had never talked to this chronicle reporter. i found the person's e-mail at the bottom of the article and was like this isn't what is happening. you have to update the story. people are left with the impression from here to dally city there is nothing to see when my people are suffering. there is a lot of work to do here. i know that there is a lot of tension between the government of san francisco and pg&e. we got people that we have to serve. as the government, you as the electrical providers. i'm willing to put the feelings in the parking lot. we got to get this right going forward. i understand there will be power failures but we have a failure

to responds appropriately communicate appropriately as well as deal with the infrastructure challenges of differed maintenance and replacement. the things we can control, which are communication and helping people when there is a short term or this case what was really as long as 5 days, we can do better. so, thank you for that. i will take this off-line as it relates to establishing better communication between our first responders, our emergency management infrastructure, healthcare infrastructure and pg&e and endeavor to do that in the days and weeks ahead. thank you one and all and mr. chairman, i like to make a motion to file this item. >> thank you president peskin and let me just say before we vote, thank you for leading this effort and also thanks to your constituents who came out to speak, but also

just to be clear as you lead this effort, that you are doing so on behalf of your constituents but also all of us on the board are hearing the same experiences that we heard in depth about in these presentations around the city and so as much as sometimes we are in our district silos on certain things, rest assured that you have i can't speak for the whole board, but imagine i do when i say, the support of your colleagues in wanting especially on the communication front as well as addressing. we want to prevent outages but we need the plan of action and communication with all our residents so thank you for taking this on and for your work both here on this and it sounds like off-line where it will continue. so, with that, on the motion to file the hearing, please call

the roll. >> on the motion, member peskin, aye. member chan, aye. chair preston, aye. you have 3 ayes. >> thank you the motion passes. thank you everyone and do we have further business before the committee? >> there is no further business. >> thank you, we are adjourned. [meeting adjourned]

>> it's great to see everyone kind of get together and prove, that you know, building our culture is something that can be reckoned with. >> i am desi, chair of economic development for soma filipinos. so that -- [ inaudible ] know that soma filipino exists, and it's also our economic platform, so we can start to build filipino businesses so we can start to build the cultural

district. >> i studied the bok chase choy heritage, and i discovered this awesome bok choy. working at i-market is amazing. you've got all these amazing people coming out here to share one culture. >> when i heard that there was a market with, like, a lot of filipino food, it was like oh, wow, that's the closest thing i've got to home, so, like, i'm going to try everything. >> fried rice, and wings, and three different cliefz sliders. i haven't tried the adobe yet, but just smelling it yet brings

back home and a ton of memories. >> the binca is made out of different ingredients, including cheese. but here, we put a twist on it. why not have nutella, rocky road, we have blue berry. we're not just limiting it to just the classic with salted egg and cheese. >> we try to cook food that you don't normally find from filipino food vendors, like the lichon, for example. it's something that it took years to come up with, to perfect, to get the skin just right, the flavor, and it's one

of our most popular dishes, and people love it. this, it's kind of me trying to chase a dream that i had for a long time. when i got tired of the corporate world, i decided that i wanted to give it a try and see if people would actually like our food. i think it's a wonderful opportunity for the filipino culture to shine. everybody keeps saying filipino food is the next big thing. i think it's already big, and to have all of us here together, it's just -- it just blows my mind sometimes that there's so many of us bringing -- bringing filipino food to the city finally. >> i'm alex, the owner of the lumpia company. the food that i create is basically the filipino-american experience. i wasn't a chef to start with,

but i literally love lumpia, but my food is my favorite foods i like to eat, put into my favorite filipino foods, put together. it's not based off of recipes i learned from my mom. maybe i learned the rolling technique from my mom, but the different things that i put in are just the different things that i like, and i like to think that i have good taste. well, the very first lumpia that i came out with that really build the lumpia -- it wasn't the poerk and shrimp shanghai, but my favorite thing after partying is that bakon cheese burger lumpia.

there was a time in our generation where we didn't have our own place, our own feed to eat. before, i used to promote filipino gatherings to share the love. now, i'm taking the most exciting filipino appetizer and sharing it with other filipinos. >> it can happen in the san francisco mint, it can happen in a park, it can happen in a street park, it can happen in a tech campus. it's basically where we bring the hardware, the culture, the operating system. >> so right now, i'm eating something that brings me back to every filipino party from my childhood. it's really cool to be part of

the community and reconnect with the neighborhood. >> one of our largest challenges in creating this cultural district when we compare ourselves to chinatown, japantown or little saigon, there's little communities there that act as place makers. when you enter into little philippines, you're like where are the businesses, and that's one of the challenges we're trying to solve.

>> undercover love wouldn't be possible without the help of the mayor and all of our community partnerships out there. it costs approximately $60,000 for every event. undiscovered is a great tool for the cultural district to bring awareness by bringing the best parts of our culture which is food, music, the arts and being ativism all under one roof, and by seeing it all in this way, what it allows san franciscans to see is the dynamics of the filipino-american culture.

i think in san francisco, we've kind of lost track of one of our values that makes san francisco unique with just empathy, love, of being acceptable of different people, the out liers, the crazy ones. we've become so focused onic maing money that we forgot about those that make our city and community unique. when people come to discover, i want them to rediscover the magic of what diversity and empathy can create. when you're positive and committed to using that energy,

yeah. mr bridges. absent commissioner, fiscal president. mr gandhi is absent. commissioner help on present is it's a fight president. mr thomas president, we have a quorum. great madam secretary. please call the first item. thank you. item number two communications. we welcome the public's participation during public comment periods. there will be an opportunity for general public comment at this meeting and there will be an opportunity to comment, discussion or action item on the agenda. each comment is limited to two minutes. please note that city policies along with federal , state and local law, prohibit discriminatory or harassing conduct against city employees and others during public meetings, it will not be tolerated. world for public comment is permitted only on matters within the jurisdiction

of this meeting party and we thank you for joining us. great. madam secretary, please call the next item number three general public comment great. so there any members of the public who would like to make general public comment? i think we have some names here today. so if you can come forward. momentous. this is the first public in person comment, right? no we have fred sanchez friend. and then we had some people last time to from school. yeah yeah, just recording your voice. please proceed. you have two minutes. thank you. good morning, everyone. my name is broadly. begala and i am lead organizer with african

communities together, a nonprofit dedicated to improving improving immigrants to fight for the dignity and respect they deserve and this role act supporters. the tenants at 1000 towers who are fighting against their displacement. the hands of tm group southern towers is a five building apartment complex located in alexandria, virginia , and has been home to thousands of hard working blue collar, um , many of whom are african immigrants. 1000 towers were previously viewed as a safe haven for affordable housing. but after the cme group who have previously viewed as a safe haven of affordable housing, but same group who you have invested roughly 931 million into has changed the perception and engaged in predatory actions and that put vulnerable tenants at the risk of displacement.

tenants have reported massive fiction filings and address to maintenance issues mauled disrespectful treatment and significant rent increase that situation at 1000 houses, unfortunately, not unique and see empire is a history of finger aging and scrub bliss practice to make a quick buck during your april meeting. cme's committed to e. c. g was discussed and after reading the staff anymore, we were shocked to see that your team has determined that cm is dedicated to s e g. when their actions against vulnerable communities show complete opposite your memo mentioned that this conclusion was reached after that stuff staff spoke to with same and reviewed the company's policies and reporters. what cm has their issues reports one tell you that when we asked sam to trying to let its complex 40 page lives

into relevant language, 14 anders was limited english proficiency that refused cm and there is the reporters want to tell you that same was giving tenants five days notes of eviction when their federal obligation under the cares act. required. they give 30 days notice. you could just wrap up, man. just your last sentence. thank you. your last sentence. we are asking you to conduct a proper investigation. enthusiasms commitment to sug by taking directly with impacted communities also asked thank you. thank you. the remaining tenants are here. next speaker please, and we also turn up the volume markers that please ensure that microphone is on. into the mic. i i'm next speaker, please. hello, everybody. my name is harem a

share and i am a tenant's 1000 towards towers is a five building apartment complex in africa, india, and it has been home to thousands of handle of hardworking families seeking a better life. for years, 1000 hours has been known as a safe he having for the immigrant community that all began to change in 2023. i m puts the complex, although see, i am plans they are community, focus it and dedicated to maintaining workforce housing. for a blue color workers. their actions have made it clear that they would rather contribute to the this, uh to the displacement of working glass families, number of fights stable and safe

housing. in addition, raising rent cost tenant at 1000 towers are also forced to deal with maintenance issues. that's the i m consistently fails to address we find our selfies in this fractious cyclists where we discussed where we discover a maintenance problem we put in a work order for staff to fix the problem. nothing gets done. and then we again. we have even found that some of our work orders and up getting market asked, completed. when nowhere. has been done at all. i was up, tenants have reported. that. when they put in a maintenance request to address the model in their unit maintenance. its

staff simply fans over the mall instead of properly. eliminating it, as you can imagine, this has severally impacted, uh, the quality of life for a lot of tenants. imagine finding out that your kid has developed it asthma because of the unsolved mall in your sc unit. or finding out. that the leak coming from your selling has grown into a flood. as a blue color workers. we are already working hard to make ends meet with the rising cost of living. we should not also should not also be time. finished your last sentence? yes. we first thing housing

grouses, uh and, uh, are in a unique position to help we are asking you to come to conduct a proper investigation. um, commitment. thank you so much next speaker. with money, everybody. sorry. i'm speak arabic. some ladies transform one's gonna translate for you, okay? um and it's part of the follow up. that's ours. ours my band from kenya here, mccann seconding me. admin open of the listener $1000 kamala's green lacking by the house or whether 2023 i am die from being normal.

we're supposed to talk to the second. tamara's got it just bit access other taxes or whether i see it. i was. health care. i mean, the legendary kennedy. well, that's a real fellas are advisory legal. i am alina. now he cannot rather saying misery. listen in that second. the second year in his business. yeah that's agreements written to say, yeah, i'd be my fault that fan memory that the second here and we gotta mean in hazleton is on hold. area in the

in the americas, ci empty guy animal and not even with off a little with mia. and i had the higher ah, okay. tournament legarrette. shari when he's with the lazaro, dammit, but, uh he doesn't see i m zero. in the months, two months. don't look at my father's adequate. which i hope to hear. um it's about lerner and nothing is definitely surreal bus manager i'm not not hired legitimate palin misery probably see i am will have this movie. lines. why don't for

eight years the smart you see, i am the head normally get that machine. man. we got mr locum. thank you very much. thank you. as you said his name is tarik kafala and his tenant. uh can you get just a little closer to the microphone? thank you. thank you. so as you said his name is derek kafala, and he's one of the 10 and 30,000 hours just to generalize what he was saying. i myself have been a victim of same unfair, unfair price pricing practice. during the pandemic work was limited, so i had to rely on the rental assistance from the government due to the backlog of applications in my rental assistant was delayed am decided to capitalize on my vulnerable

position and used the late payments from the government as justification to move me into amendments to list a company that's truly committed to scg should never use delayed government assistance during the pandemic as an opportunity to move at 10 19 to more expensive and less, uh, abilities. we are facing a housing crisis and you are we are. you are in the unique position to help. we are asking you to conduct a proper investigation into cnn commitment sug by taking directly with impacted communities. we also asked that you had in future investment until same properly addresses this issue and contact. see, i am and demand that they take our request seriously, and to treat their 10 unders with the dignity and respect we deserve. thank you for your time. thank you. are there any more speakers

today? thank you. thank you. good morning, everyone. my name is ayana to vegas and armenian in art. other stars. i was 18 and southern towns up. towers i'm very disappointed in your staff's decision. that's time is committed to e s. g when nothing could be problems are from the truth across the notion 10 tenants have been calling attention to cmc immoral. business practice. so you can only imagine how much of. slap in the face. it is to no see. this very calm. company be uploaded for conduct out is

contributing towards our housing crisis. see i am could has been so three .org that's african community together hard file a conflict with the federal housing finally finance finance agency and fit pretty mark showing how cms action run contract to freddie mark, starting purpose. purpose of preserving affordable housing. if this board is truly committed to g, you cannot simple really on cmes work that they are committed to e s a g. you must engage with the people on the ground. i was actually impacted your staff. mentioned that there

were no indeed. identify mean. literally a risk associated with the i'm practices tell that the family who are being pushing out their homes becomes because see i am wanted to capitalize on their not ability. thank you. thank you. there anymore, um, speakers, public comment. okay thank you. then. public comment is closed. madam secretary. uh please call the next item number four action item approval of the minutes of the april 2020 23 retirement for meeting what's up for a second? okay are there any members of the public who would

like to make public comment on this particular item? seeing that public comment on this item is closed. motion made by. commissioner thomas seconded by commissioner helfand. uh huh. madam secretary, please call the roll. mr thomas. hi, mr halphen. president spy. i just throw. mr bridges. i thank you. we have five eyes. motion passes great. i'm secretary. please call the next item number five action items consent calendar. moved. to ma okay. move motion made by commissioner helfand. seconded by commissioner thomas are there any members of the public who would like to make public

comment on this item? seeing none. public comment is closed. a motion has been made by commissioner health fund seconded by commissioner thomas those in favor. alright say aye , those opposed. motion passes. madam secretary, please call the next item number six discussion item chief executive officer's report was continued from the april 2020 23 recurrent board meeting. thank you, madam. c o c i o good morning. commissioners want to provide you with a number of updates for the ceo report? um first related to the forward calendar. i want to bring to your attention that the personnel committee will be meeting on june 20th and the topic of conversation will be of um, i'll have hit my one year mark. and so it will be my performance evaluation and we're getting on back back on track

for actuarial services coordinator evaluation and i bring this to your attention because you will be receiving from ashley dunning at nasa men within the week evaluations for you to complete and we very much appreciate you filling that out so that the personnel committee can can fulfill their role. and we can again get this process back on track. likewise the investment committee meeting is scheduled for july. 12 we have a lot to cover during that meeting . we have three asset class reviews and we will be reviewing the absolute return revised guidelines to the extent that you have now are looking at your calendars and there are any issues. please let us know as soon as possible. um but it's an important meeting and i hope that we can stick to the schedule and have that on july. 12th ma'am ceo seo just intro, can you can you say who's on the finance committee public? klay. on the investment commitment committee. the entire board entire board. okay. just wanted to make sure thank you. um

another scheduling item that i want to bring to your attention in june. that is the time of year that we name the president and vice president for the year and it's the time that we establish, um, the scheduling around the board meetings. i know this past year we've changed the time it would be incredibly helpful, uh, for staff, and i think, probably also for board members to make sure we reaffirm when those board meetings will be so that we can plan accordingly. in our work and our schedules. likewise in july, the committees will be named and, uh, the ongoing theme here is working with you to make sure we get the committee's schedule set, so i will be very active once those committees are named to work with the members and get it set and hopefully have a calendar that we can stick to the following year. those are the scheduling items. the next item i'd like to discuss is their board vacancy. i want to update all the board

members that on may 11th nominations were closed for the vacant seat that we had. we had one nominee. um and that was tim o'connor. the department of elections is certified that tim is the trustee for the retirement board. we plan to have him sworn in in advance of the june meeting and i, along with staff who work very diligently to, uh, provide orientation and onboard him, and, uh, in in advance. i would just like to thank you, tim for his commitment and willingness to serve on the board on behalf of the current and future retirees of the city and county of san francisco. finally um, i wanted to bring to your attention that we've included their retirement dashboard, which is a quarterly report into the ceo report. uh obviously comes under my purview, and this is just a way to keep the agenda moving forward and included so to the extent that you do have

questions or want us to go through the dashboard we can, but it is available here in the materials. are there any questions? thanks for the date, thanks for the date on the dashboard. whether or not we would anyone comes into differed comp but also there's servicing going on the deferred comp program that may be useful that here to prove there's a lot more servicing going on. that may even appear on this one, doctor, but this is excellent. thank you. sure. um, can you just reiterate those dates again? i have them on my calendar, but i just want you to save it for the record. so july 12th is the investment committee meeting, right? correct and then what are the other dates? big dates? well the other big dates are reconfirming when we're going to for the following your have our board meetings confirming the calendar. correct so those are that's not on the agenda. today,

though, it is not. i'm putting that out there, so it's something that that will be prepared to address in june june, 20th is a personal correct . excuse me. can you say that to the microphone, please? june. 20th is the, um personnel committee personnel. and this is all in the forward calendar. that's in the materials. i understand. i just think it's important to say it on the record, so everyone hears it. appreciate that. i mean, i have all this on my calendar. but for those listening and for the record, so the personnel committee is june 20th. and who's on the personnel committee. that is commissioner halphen and commissioner thomas okay? so. you know if there's not a committee meeting, we know who's responsible. all right. so those are the two big dates. june 20th july 12th. transition

of presidency and then calendar. any other important things that you wanted to those were all the topics i plan to cover on this report. okay, great. so there excuse me. are there any members of the public that wish to comment on this item? seeing no public comments closed. so that's it, madam secretary, please call the next item. i have never seven discussion item governance committee meeting report, and this item was continued from april 2023 retirement board meeting. we have a presenter today. commissioner driscoll. you um stepped into chair the governance committee. is there anything that you would like to share with a broader board? actually knows first meeting. you've had some book. thank you. thank you. that's all. it's on now. when the lights off, it's on was okay. thank you. confused

remotely was done. thank you. it was first meeting at some time. but the key thing about the meeting or the ex the next three items on the agenda items 9 10 11, so that will basically include the report of the committee. thank you. mhm was there anything in particular that you wanted to highlight on top of wood commissioner driscoll said. commissioner driscoll. maybe for the record if you could indicate that the governance committee approved, too yes. the committee did approve the minutes from the main meeting in 20. 21 and then recommended the items you will see in the next minute in items 9 10 and 11 in terms of reference and operational policy. thank you. well, great. are there any members of the public that wish to comment on this item? seeing non public comment on this item is closed. madam secretary, please call the

next item number eight action item review and approve revisions aboard terms of reference and policies. minor edits. this item was continued from the april 2023 retirement board meeting. okay? commissioners i am pleased to have before you the next three items, um, which reflects the board terms of reference and governance policies. by way of background. these are the first set of documents that i asked to see when i, uh join us furs because this is what outlines what my responsibilities are what staffs responsibilities are and what are the responsibilities of the board, and this drives everything that that we do in my role. i view that i'm here to help facilitate you to adhere to these policies . the policies generally are up for review. every five years. we were somewhat behind and having a robust review of them. so i

went through all the documents to clean them up and make sure that they were clear and consistent. uh did that with the help of karen of cecilia, with ashley from from nasa men to make sure that it reflected our current practices reflected, uh , current law regulation, etcetera and minimized redundancy. in some cases, i think over the years things have been added to various policies in various places, and that becomes more burdensome. want to update and to be confusing if we have things that are different and policies so overall, i would say that these policies have not. it's not been a major overhaul. it's not that we've completely rewritten these. we've tried to clean them up in this section that that will cover on this agenda item or what we're carrying, characterizing as, uh, minor edits so either typos or just very minor clarification points that that we have put into these and to help you. we have red

lines, and we also included in the first exhibit. a summary of the changes in the policies so, for instance, to give you a flavor for the retirement board terms of reference of indicated that the ips investment policy statement would be reviewed, not less than every five years. rather than every two years. this this isn't something that generally we would be changing regularly. we have the option to review it more often, but recommend five years. um we've also, for instance, done things like combined the vice president and president terms of reference for simplicity purposes. um i do want to point out one particular item. with respect to the. code of fiduciary conduct, ethics and governance. um it's consistent with what we discussed very much in making sure we have meetings scheduled and we're here the items that they haven't really changed, but i want to bring

your attention in the code of fiduciary conduct board members are to make good faith effort to attend an entirety of the board meetings and the committees in which they serve provide notice to both myself and to our board secretary, if you can't attend be active, engaged and refrain from using electronic devices during border or committee meetings in a manner that may disrupt the meeting. i know you all know this. um and i appreciate your diligence and in these, but, um want to make sure since is there's a lot here to bring that to your attention. happy to go through in more detail the changes, but those are the points that i wanted to make with respect to what's in this agenda item. spread any questions from commissioner? yes, i have one. health fund. this is good cleaned up. understand approved. i mean, i like it all, but i'm confused. have oh, is there a redundancy

in the word? executive director commissioner can just speak into the mike because it's not going into the microphone. is there a redundancy that. adding the name the title of executive director. with the i o. c e o and i am i personally. it is redundant, and i think you get rid of the term executive director. okay thank you for the question and to give an example of how diligent we were in reviewing all of this. that was the point of discussion among all of us and, um, sincerely, maybe correct me if i'm wrong here, but, um, so the charter still uses the term executive director and so the ceo and see i was acting as the executive director. and so for consistency throughout these policies, we used the term executive director. are we beholden to the charter in the different in definitive in the definitions of that, the way we

comport our business, and certainly in this way yes, we are and also the charter. sets out to the executive director can be ceo. c i o or ceo. so if there ever were a division of the roles in the future then we don't have to go back and change everything because we already have it as executive director. boy commissioners. another place where you actually wrote that clergy guys, hold on, please. please wait to be recognized before everyone starts talking. commissioner. frisco go ahead. i'm just gonna mention that there's another document where this was addressed where it's written out where executive directors there you go now it's on. it's on. go ahead. you can check which documents were the phrases the terms executive director is he quick equivalent to the c e o. c i o i forget which document was, but it's addressed there. anyone else wish to comment on this item?

okay please. of. one further point on the executive director question of first of all, the executive director. term of reference addresses this point that your that your executive director currently is the ceo. c i o in addition, from a streamlining perspective, almost all of your policies reference an executive director, and so to avoid the whiplash of having to change that, over time, with respect to multiple references. we thought this was a better a better approach to just keep it to executive director, having defined it as you apply it currently. commissioner. union. did you have size? okay? any other comment. i mean, just just to add on to that. i mean, we spent a lot of time with the initiative was partly regarding the retirement. of those prior to 1996. and then we added the

language about ceo ceo into the charter so because it's in the charter commissioner helped fund is defined very explicitly. we have to follow. you know that got that guidance and we were very careful to define what executive director and ceo ceo wasn't spent a lot of time with the city attorney's sicilia and her team. so this allows for a broader reference. and then we defined in another place. so appreciate that. any other questions or comments. okay? um so that was just purely item number eight. for now. so. so this is about improving the revisions to the board. terms of references and policies can have a motion please. hotel crow. moved to approve made by commissioner alphonse, seconded by seconded by. commissioner bridges. are there any members of the public that wish to

comment on this item? seeing them public comments close. motion has been made by commissioner alphonse seconded by commissioner bridges those in favor. bye. those opposed. okay no objection. motion passes. madam secretary, please call the next item number nine action item read and approved revisions of board operations policy. madam ceo seo. thank you. this item is a separate agenda item because we were required to have this posted for 10 days, so we've pulled it out, but the items that have been, um, edited or amended again a red line, does it all the sections and what we've done is, um, indicated that, for instance, notes for meeting minutes would be approved by the board, which is what we've already been doing and establishes that standing committee meetings generally will be scheduled on a wednesday rather than only the third wednesday of the month. so again

discussion in here about keeping a regular schedule and having committee meetings. but the edits themselves to this document were relatively limited . i should also mention we added language on parental leave to be consistent with the city. running questions with respect to the board operations policy. any questions? commissioners any . did you have a comment? the only additional comment i'd make is currently or policy provides that public comment. maybe up to five minutes. although your practice and your board meeting agenda state that you prefer two minutes um, this find a happy medium of three minutes, which is a very common practice across that again. it's on page 10. it changes the public comments. reference to three minutes as opposed to up to five minutes, so that would need that should be changed on your agendas. if you adopt this and that is the

most common, uh in my experience , advising a number of boards across california. up to three minutes is a is a very common and we don't even do that. our practices two minutes. i'm just noting that we have the flexibility. you have the flexibility, right? right question. commissioner halphen also with regards to that. how flexible are we on wednesday day ? yeah it was good, but hold on a second jumping back. i want to talk about that as well. but i want to finish the time limit is anyone have any comment on that? just to clarify the last sentence. um, through the. to the city attorney or the c o. c. i o said the president of the time aboard may limit the total time to 30 minutes. that's total for item or total in gent, er

item. okay just wanted to point that out on that that is, i believe is state law. right? i mean, that's what we reference in. and we do our transportation 30 meetings that they stayed out that based on state law that each item can be limited up to 30 minutes by the chair of president so that is our governance policy. but i just want to say on the record that that is a that is a practice with throughout the state commissioner driscoll. two things one and then becomes down to and the definition of item. does it apply to the motions or the item? some items have multiple motions to execute, or that the item that's a loaded question. but is there already an answer to that? generally it's per item. i can't think of an example when we had have had more than one vote for item. i think we're usually trying to break it down. so it's one vote per item. well, yesterday we could have had four at the differed company. we decided to

package it, but it could have been four separate motions. i'm just trying to understand that he should. i know you do have commissioned driscoll. if there's multiple items, you can merge multiple items on an agenda, and then there becomes that then becomes one item the public can comment on not each one separately. what i'm trying to drive that if somebody wants to speak and get his 235 minutes on every motion as opposed to the item, yeah, he's the point that the president or whoever is chairing the meeting can make that ruling to include which is my next point, it doesn't have to be three minutes. if we use the maximum limit of 30 minutes, we say, folks, unfortunately, somebody speakers, we're going to have to reduce it for two meetings two minutes today like we did today. flexibility there is under control. i just want to make sure that the public would understand. yeah means the item not by motion, right? good point. thank you. that's correct any other comments or questions on time limits? okay now, commissioner health. i was going

to ask the same thing. so i'm glad you brought that up. go ahead. please reiterate. you're just, um i think it's essential and i'll speak anyway. um when president sapphire came on as the president. and in his role as as a commissioner here, as well as a supervisor for the city. um this supervisors have a very full agenda and its monthly . i mean, we're it's more current than we have. so i'm just if it if in the future i know wednesday is something that is sort of ingrained in a lot of our constituency. our operations . it's been that way. we switched to thursday to make it operational in terms of president stuff to eat. but. are we locking ourselves in here on this item? because i would

suspect that we would have a conversation about going back to wednesday. um it if when president suffer is term as president expires. if i may address that the language is written that regular meetings are held on wednesdays or at other time, date or places, uh. that the board may designate, so it does provide some flexibility . i think it's anchoring in on a wednesday but provides flexibility if different decisions made the part that you said yeah, at the very end. um so i'm looking at page four. item 18 and where we see regular board meetings on the second wednesday, and the last phrase is or at other time date or places. the board regular meeting may designate. i didn't see that either. i wouldn't we just just to continue to

question why wouldn't we with four? god we were passing this we're going to pass in an actor's today i prove it. okay why wouldn't we say there will be thursday of each month at 11 at 11 like it is right now and then when we went if we go back to that there was some sorry. why not put thursday? in and then go back to wednesday if we if we choose to i just go ahead commissioner minute. um i think that the current draft makes sense in that it provides us with the flexibility to return back to the original date if necessary, but we can also maintain the current one, especially if we're looking at this in the future. given the way that it's written, it seems like it allows us to the flexibility to do any of those that the date you know? yeah i

feel like i agree. i like it the way it is bridges. thank you, president saffy. i concur with commissioner thomas. i think i like the language the way it is because it gives us the flexibility. if you go to thursday friday, it doesn't matter because that last sentence gives you the flexibility to move. but i like it the way it stated now and also as a member of the governance committee. kentucky. you okay with that? i'm fine. yeah just to add on to your point that the main conflict was if you have a member of the board of supervisors that also serves on the budget committee, the budget committee meets on wednesdays. so that was why it didn't matter which week it was in the month. it was the fact that it was a wednesday. i know here. it's his second wednesdays. i don't remember. i guess that's what we did. and then we moved into we were working out all the different schedules here. um. but i mean, i think it's fine the way it is

because of that last sentence. we have the flexibility. i just wanted to point out there in the future. if not me and somebody else and they happen to be on the budget committee. you're going to continue to have that conflict because budget committee meets, um, mornings and then once we get into the budget season for the for the city, then they mean in the afternoon as well. it makes sense. you want someone that understands the finances of the of the city. so uh yes, commissioner bridges. if there are no more comments on this item, um president salva ii move that were approved the revisions of the operations, the board operations policy. the motion made by commissioner bridges seconded by second commissioner health bond. are there any members of the public that wish to comment on this item? seeing and public comment is closed. so emotions been made by commissioner bridges seconded by commissioner health on those in

favor. by those opposed. seeing none hearing no objections. the motion passes. madam secretary, please call the next item. remember 10 action items, review and approved revision aboard policies more substantial edits. this island was continued from april 2023 retirement board meeting. so this is the last of the three items related to governance policy and this group of, um, policies had a few more edits than the last group. so we put them in their own section, as we did for the other sections. i have a summary page trying to highlight what the changes were in each of those policies and there are a number of items that i'd like to highlight here. to make sure that that, uh, you're you're comfortable with these changes first as it relates to the strategic plan. um previously

there was really the policy was set up that there was an annual uh, strategic plan and we will be reporting on a quarterly. my perspective is that a strategic plan is typically more of a three or three or even five years. uh type of plan. um, and so we've set up this strategic planning policy now to be a three year plan with annual updates, so the communication will still be there and you will get updates as to where we are in that process, but the development of the strategic stand will happen on a three year rotating cycle. secondly for the monitor and reporting policy. um i went through this with a fine tooth comb. this is the place where there was some redundancy in particular. there were there was a table in there that highlighted all the reports that we deliver to the board and other reporting requirements. um and a lot of that was already covered. in all the other policies. so what i'm recommending here and what

you'll see in your materials is i updated the table so you can see all the items that are now current with the other policies , but i do recommend removing the table because we run the risk of again. we change a policy in one place, and now we have to change it somewhere else. so i have a very, very detailed, um, report schedule that i'm maintaining i can make that available to you. we are not losing and reporting just don't want i don't recommend having the redundant table here in this policy. the third item that i wanted to cover is with respect to the communications policy and here wanted to highlight some and reaffirm some items that are in the communications policy. first on communications with staff as as written in the policy. all requests for information that required work should be done in

writing and should be directed to me, the ceo or the actual actuarial services coordinator. copy me, please on all those emails, um and these are requests for consideration, not not necessarily action. um and i'll get to that in a second. but please do not reach out and we have this in policy to individual staff members with requests again. they should go through me through karen or to the actuarial services coordinator. the reason i say that the requests are for consideration is i want to work successfully with you all as a board. we've gotten a lot of requests. those are great. we're very happy to have an inquisitive, uh, engaged board. um, i will be. i am keeping in formal and informal log of all the requests and want to make sure that the time spent by staff is aligned with the collective board boards view of where we spend time so um so we will work with you on that, and

we may have further discussions. but first and foremost again just wanted to highlight that that communications with staff on work requested go through through. myself. secondly communications with members and beneficiaries want to reiterate that madam secretary madam secretary, madam c. e o. c i o m. the last sentence. you. you saved. this policy does not include routine request for readily available information. what does that mean? so a document that already exist just a question on a matter of fact of something, you know policy. what have you if it's an, uh, on the other side of the spectrum, it's we want you to look into making this change with how you administer something, or we want you to provide an analysis of a manager or a new investment. those are obviously much more substantial work. what is the purpose of that? sentence. it seems, it seems nonsense

quitter. are you saying? what what? i think you need a little more there. it doesn't. it's not making sense. are you saying if a board member has a routine information request. it can be done verbally, and it can be done to anyone. because it's not clear, direct, just like this is it, says board members request for information from staff got it. there's no page numbers so i can tell you a page. i'm there. i see where i see the things that you struck. and we've had conversations and i've been very clear in terms of what i believe is the right way to communicate . it should definitely be on every board or any that i know. in this city communications from commissioners are done directly to the executive director and ceo. c i o not to stop. and i think that's very clear except for that last sentence. the intent was to give a little bit of flexibility. you know if you

want a basic document that's on our website. and you're talking to your in a room with whatever staff members. we don't have an issue with you saying, hey, can you send me that? yeah the idea is, if there's any work that's required. i don't i don't think that i don't think that's i think that's too broad. i think that personally and i'm happy to have other commissioners way in. but i think personally that communications from commissioners should be through the ceo, ceo or uh, actuary service. person i don't think it should be direct communication with staff for any information personally. i don't think that's a good practice. i think it's too flexible. it leaves room for a lot of things and the and the interaction dynamic is one in which it can start off with a routine requested then grows into oh, but i can do and then it becomes even more than that. i don't think it's appropriate. i think i think we should strike

that last sentence, and i think i just have a comment from a governance perspective. i think it's a really good observation one way to reflect. i think both interests and i defer to your ceo. c i o on on this, but, um would be to note that it does not include routine requests for readily available information and then identify to whom that should be directed. for example , your board clerk if the request is for the board packet for a meeting or to know where the policies are within your systems, you shouldn't presumably from a governance perspective. be taking your ceo seo's time with that. but the board clerk would know exactly where to direct you. that's what that might be an insulin available information it should to should be directed to the to the board clerk. i'm fine with that. that makes sense. but i just want to draw a clear line between the commission and staff. i don't think it's i don't think information request should be going from commission to staff. i don't think it's appropriate. so i'm happy

commissioner driscoll. i assumed the way. ms stunning brought up this issue. for example, the board has an executive secretary. do we have to go through the executive director slash ceo seo to ask something. i think that was the point. i think that's a good point different terms. that's one too. what about the actual services coordinator? what it's mentioned here as it's one that's allowable. it, says c 00, or actuary services coordinator makes those are understand the same chapter. what about any of our external well, that's in a different area, external communications. but do i have to go through the executive director? it depends on what external communications are referring to general consultant. sometimes called the board consultant. so right now you're talking commissioner just

quality of talking about requests for information from staff, so that would be a different section of this that should be discussed as well. but maybe not. maybe we can refer to that. well, sometimes it's into it. even some of the subjects we work on here are worked with board staff. an external people. obviously the executive director ceo ceo wants to keep track of everything that makes good sense. but making a requisition that i have to go through her to talk to somebody else. sometimes it gets awkward or forgetting usually when i want to, and i know who the person who has the answer to the question i c. c the c e o. c i o is that in violation? would that be a violation of the rule the way i look at it, but i would have to. i want to hear what the ceo has say. ms dunning's point. the section that we're talking about is information from staff. there are sections on guidelines about , uh, communications with others

specifically address, um, commissioner driscoll's question , though, with respect to the board consultant, it is your consultant and specific to the board consultant. those communications can be direct. that's why in some ways comparable, the actuarial service coordinator reports into the board and it makes sense for you to have that direct access there as well. i don't want. where's the section that talks about? turned back? excuse me if you turn back to the prior page under item, um 11 external communications service providers, i believe that directly addresses this point and notes that board members simply agreed to inform the board president and executive director in a timely fashion if they are having significant communications containing his first business with those individuals. yeah and it references the investment consultant, so there's absolutely no prohibition on that. there's simply a, um it says to keep keep them keep them in the loop priced right. that makes sense. in in terms of the

title that's referenced. i differ whether it's board clerk or or board executive secretary, but it's the same person. to whom we were referring and believe what is the appropriate term? word secretary. so there's a couple other items to discuss on the communications policy, but i just want to make sure we're clear on what we're going to change. yes so what we will change here at the end is that this policy does not include routine requests for readily available information. um that those can be directed to the board secretary. comma which should be directed to yeah. or which are to be we could make it more directive. interfere with me. don't wanna make sure i'm on the right hate on this thing. sure you on section item number 10 10 years. and its board members request for information

from staff. it's item under which under which 13. oh, that's not the right word. find the best with your stuff broken up. beijing numbers not number was page numbers on this. i was organized coming in. it's this. it starts with this. calendar. here it is. this one. san francisco employees retirement system board communication policy. medications investment. called him out. oh commissioner thomas did you have i'm sorry. i know you had your hand up. please go ahead, looking for us. i think we've resolved it would have been okay.

page. to the right section i can before living right here, right right there. just policy does not include routine request for readily available information. and then we would add, which are to be directed to the board secretary. which are to be directed to the board secretary. we would add that comma, which are to be directed to the board secretary board secretary not to the ceo. i can support that. let me move on. please perfect. so that addresses information requests from staff. i think it we've talked about interaction with the consultant a couple other points to make communications with members and beneficiaries. so, as you

reminder board members they only convey general information to beneficiaries and cannot provide beneficiaries education or technical information on their benefits. we staff cannot discuss individual beneficiaries benefits with with board members , and if a member has a question that they ask of the board members then we asked that the board refer them to other our website, the member services team or the ceo as a appropriate . um next on referrals, referrals being if you know about a jerk, come to you and ask for a meeting or other vendors again that must go through the through myself through the board. pardon that yup. is that under external? no, that's confidence. well, here we go. board member of pearls

management correct. so those were those referrals must go through me through the board secretary or the ceo for consideration. those should not go directly to staff. obviously we would involve staff as appropriate, but that they should go through me. two more points on the communication policy one. what we're terming communication with two hats, um, board moments. discussions with stakeholders when acting in two capacities. um i had as a board member and that of one of your other roles, and that should be aware includes both in person discussion, but discussions that we have heard through email or social media. and then finally, and i know you are all very keenly aware of this. i want to remind you that nonpublic information that we share with you in the course of interaction and board meetings must remain confidential. so those are the items on the communication policy that i wanted to

highlight. i think we have for the record that the amendment that you wanted added in there, but i certainly welcome any other questions with respect to any of the policies in the section. any commissioners. questions further comments. okay? great. just just going back to the remember referrals to management. it was just rereading that. so sounds that's

been a consistent practice. but you've added some language or remove some language. um is it in that instance i see the board secretary. if someone. i wanted like a plant member investment manager media otherwise. you can contact with any of us with regard to benefit investment or other retirement related matters. when that just makes sense to just go straight to the c e o. c i o and that's it. and that instance not the board secretary, that seems like a pretty significant request. i just want to understand what thinking is behind that. i think the rational that we were discussing before applies here. um you know if it's sort of a routine request of something that that we provide to, uh the member. and its administrative.

i think that can go to the board secretariat. it's a larger ask, right, you say plan members. okay so you can leave the flexibility. it's more general in nature are simple factual, so it's like the ceo or the board secretary. correct. okay got it. okay. i'm good. so i think we need to make a motion to amend. um and add that sentence and then we can then vote on the whole item. so is there a motion to amend as written into the record under this section board members requests for information for staff. they would read. this policy does not include routine requests for readily available information, which are to be directed to the board secretary. the motion to make that amendment. somehow. seconded by . second seconded by thomas. by health fund. okay so we've amended that so we have to. we have guess we have to take

public comment on the item first, and then we can make a final. members of the public who wish to comment on this item. seeing the public comments close. so there's a motion to amend as read into the record by commissioner alphonse second commissioner thomas second wife commissioner helfand. all those in favor. i supposed. okay so that amendment motion passes and now emotion too. uh just send the for the item to pass the item as amended. napa box in summer. moved by commissioner bridges seconded by commissioner health fun. all those in favor. hi all those opposed nay. okay. the motion passes. um i think we're going to take a break for lunch. we'll come back to item number 11, okay? lunchtime.

sorry. we will be back at 12 45. president, mr health phone. i wasn't presidents of ie present , mr driscoll bridge is present. we have a quorum. great madam secretary. please call the next item. never love in action item consideration of remote public comment. alrighty uh, any i presentation, madame c o. c. i o. would you like me? uh this up? okay um, so, um, relatively straightforward in terms of the agenda item, which we've laid out in the calendar sheet here, as you may recall on march 1st 2023 policy bodies no longer had a legal obligation to offer remote public comment to members of the public. um, with exceptions for reasonable accommodation, um this was

discussed at the board meeting in february, but we now have it as an action item on on this, uh , for this board meeting and we put forward for your consideration a number of options. certainly there are other options available for your consideration, but option one would be to maintain our current practice, which would is no remote public comment except where required by law. uh option two would be to allow for remote public comment, uh, for everyone with a total time limits. so, for instance, what we put forward here is up to 10 minutes of remote public comment project to item and then the per person time limit would be identical to in person. a third option that we put forward for your consideration is to allow, uh, remote public comment for everyone and those conditions would be exactly identical to in person comments so you would have limitations on individual, um speakers and as we discussed earlier in this meeting, it

would be at the discretion of the president on any agenda item to limit total public comment in person and remote to a certain amount of time. so those are the options before you happy to address questions before before we go to. oh, that's fine. go ahead, commissioner helfand. but what i was going to say is i just listen. we've gone through obviously a major transformation over the last three years with the pandemic. and it has it has burst for lack of a better word. birth, some some real positive impacts in terms of access and accessibility and public participation. um it has and i still stand by my previous comments. there are some real. downsides that our city is still struggling with as it as it pertains to remote work in particular. um and that's

evidenced by pierre statistics. we have the highest office vacancy rate in the entire country. by by far not even close. and a lot of that has to do with remote work. ability to re entice people to come back into the office one, but it also has to do with the type of industry that we have here and were heavily reliant on professional services and the tech sector. and that is also part of the reason why, along with a whole host of other reasons that we're trying to address as a city when it comes to crime. cleanliness and we don't have to get too much into in depth on that, but there are barriers for people, and some of it was evidenced by today. i mean, we saw a group of people that came from across the country. two. common. on an item general public comment. we have retirees all over the country.

we have right. tyree's all over the state of california. have your trees all over the all over the world. and so i think that personally, i think it makes sense to have remote public comment. i think that we have the built in rules and governments to limit that. to ensure that we're still have the right flow on our agenda. but i think that it's time that we re institute that we had it during covid. all the longer wasn't much participation. still as an option. i think that some some of that has been shown to be a positive in terms of getting the input and information that we need so go. have fun. um well, i'm in favor of i let me backtrack. as much as i don't want as much as i don't want to say that getting older is a disability. but, um you know

when we have them participants in this building. particularly this building because we have the retirement board here and below us, i think is health service system, and it involves a major constituency of this city and county of san francisco. and um, just in the volume of responses i've had been emailed and what i told her i agree. it's supervisor. somebody that we should make it available to our constituency. and actually the city. the whole entire city. so, um. it the only concern i have is that we do it smartly. in terms of not um overloading our, um our teams. and in terms of comportment. delivering the service. and

reduce and addressing the costs. so i wouldn't i'm sure you jen wants to say thank god finished. that's my position. commissioner thomas. oh thank you, mr president, um, in discussing with folks that want to participate in public comment, and also with staff to, um research, whether you know the administrative burden and all would be significant. i feel very comfortable with option three from the recommendations, um and seeing commissioner bridges, um, gesture, i'm gonna go ahead and make a motion to adopt option three. okay okay. great. i'll take that motion. i mean, i just want to give everyone the opportunity to win. commissioner bridges. thank you from the think option three is the best solution for us because again going back to having constituents all over the country and sign even outside of

the country to other places. he gives every everyone an opportunity to do process gives everyone an opportunity to voice their opinion. not everyone can get on a plane. and i applaud, um six people that came in from across the country. that's that's no easy feat and financially economically. i mean, it's tough. but and we have some people that are disabled, right? you have disabled folks that you call in. i think they should have the opportunity to voice their concerns as well. so i'm a person that's really supporting option three. any other commissioners want to comment? commissioner driscoll hit your little hit your button. i can certainly support option number three. it's a period of the first two. there may be in one sense more convenient for us all the with all the other items were trying to cover but i think to use the word smartly that commissioner healtheon just used how we would implement. option

three can help us achieve our other tasks, meaning we've never actually then invoke good time limit. on the topic. and therefore some meetings. um on one item, he goes hours, which is fine. we want our members to he recognized. we want them to believe that we're listening to them, and they have all sorts of proof when the big issues just as one example the fact that we added andrew collins and another analyst to help him dealing with the s g issues is a big expense. but we did it to prove it and it's helped us improve. art is amazing, but what i'm concerned about the amount of time spent which could occur. it's a couple. it's already happened a couple of times in the last couple of years. normally then we're having particularly investment staff and other people staying in the room for a couple hours, and they're not doing other work. therefore another one of the tools besides implementing the time cap is that we have the right to say. okay we're gonna take up this item and may take up four or five hours, but because issues

of protecting the quorum we're going to adjourn the second half of the meeting, which may be pure investment items. until the next day. unfortunately, sometimes their investment items. they usually occur in the closed sessions, which we always take up first, but maybe we're going to have to push it back there on a deadline. if we don't decide today, we're not going to be able to make that investment. so again. that's a competing interest. for the time at the same time, we're trying to have the remoteness access to have our members. and beneficiaries be able to listen and participate. so again. that's a tool that hopefully the who's ever managing the board of the board would consider that so we can make option three work, but in such a way it didn't negatively affect all the other work we're trying to do at any given meeting. great. and. i think all those are really important comments. i think that having the ability to

participate. really really important kind of overriding. everything else. um when it comes to the comment, and i think you're right commissioner we've never invoked that limit, but we do have that limit and we have the ability to control for that. um okay. great some doesn't motion on the floor for option number three, made by commissioner thomas second invited commissioner. second of my commissioner bridges. all those in favor. did we get public comment? wait. members of the. and that's funny. any members of the public wish to comment on this item. seeing them. public comments closed. um okay. so motion made by commissioner thomas seconded by commissioner bridges all those in favor say aye, those opposed okay. motion passes next item.

action item recommendation to engage successful proposal to perform actuarial audit. good afternoon commissioners. in march, spurs issued. request for proposals for the actuarial audit. and we received for responses from four very qualified firms. after considering the proposals. we are asking that the board approved engagement of grs. to perform the actual audit. grs scored highly under each selection criteria, they can deliver a high level national view of our plan firm and consultant experience, and they provided a very competitive for the actual audit. do you have any questions? any questions, commissioner commissioner driscoll two questions when who was on your team? it was karen

and allison and myself. thank you. second question. has grs ever done. artists were chiron was the consulting actuary. i did not ask that question they have. then thousands will probably okay. thank you. happy to support your recommendation. thank you. any other comments. moved to approve moved to approved by commissioner alphonse seconded by commissioner driscoll. any members of the public wish to comment on this item. seen that public comments closed. motion has been made by commissioner alphonse seconded by commissioner regal driscoll. those in favor say aye, those opposed ain't no objection. motion passes. madam secretary. thank you excited. item number 13 discussion item chief investment officers report. um

that's three items that will cover today. um update on board approved investments. uh discussion of our investment manager selection and monitoring process and point will make on total planned value just have foster this process. if you don't mind. i'm going to go through the update on board approved investment, so we get that right into the record so that we can have a broader discussion on the investment process. so i will read that into the record. uh, at the board meeting on march 16th 2023 , the retirement board approved in closed session and investment of up to 25 million and pillion ventures, eight than best, um, spurs investment of 25 million in pella adventures eight closed on april 5th 2023 next. at the board meeting on march 16 2023, the retirement board approved in closed session, investments of up to 10,000,002 k v c secondaries fund three and up to 100 million and knightsbridge h. 2019 lp. spurs investment of 10

million in the kbc secondaries fund, three close on april 28th and spurs investment of 100 million in knightsbridge age 2019 lp closed on may 1st 2023. next at the board meeting on april 2020 23, the retirement board approved in closed session. a commitment of up to 80 million in t a 15. it, uh, that fun is classified as a growth capital investment within the spurs equity portfolio, and it closed the 80 million million investment in t a 15 closed on april 27th 2023 next at the meeting on april 20th. 2023 the retirement board approved in closed session investments of up to 50 million to be allocated between mayfield uh 17 in mayfield select three. investments of 20.5 million in mayfield, 17 and 13.5 million and mayfield select three.

closed on may 1st 2023 finally, um at the board meeting on february 16th 2023, the board approved in closed session, a commitment of up to 100 million in genstar capital partners, 11 and priority co investment vehicles. gen star capital partners, 11 lp is classified as a buyout investment within the spurs private equity portfolio. ah first commitment of 100 million to gen star capital partners closed on april 26th 2023. so with that i was going to turn to the presentation that i have in this report regarding the investment manager selection monitoring process, and darlene if you could pull up the slides. so um, first by by way of background. um i've spoken in some prior board meetings about the enhancements we've been making to our investment, um, monitoring and management selection process have also received a number of questions

from board members over the last several months, so i wanted to take the opportunity with the c i o report to present to the entire board. what our processes and that is, uh, very central to your role as fiduciaries to understand what our processes are, and how are our decisions are made and provide oversight. to that. um i also think it's a timely point to have this discussion because, as you know , we've been working with nasa manana delegation survey and we are on track to report that, uh, in in june, and so this gives an opportunity for you to best understand all the work and the oversight and controls that we have in in our manager selection process. so with that, um, if we could turn to slide to, um, quickly hit on the key takeaways, but i want you to daughter this presentation. if nothing else, which is one we do have a very robust and established manager selection and monitoring process, and it was all got it by the board because you all approved the investment policy statement, the

manager guidelines and the monitoring process. we've set this up to match rolls with expertise, so it is the investment team in the asset class that has the greatest subject matter expertise and they are doing the bulk of the work, but that is supported by subject matter experts as as consultants and oversight with other individuals across the investment staff, which i'll outline in more detail. we have added a number of steps to our investment monitoring and men selection process. i've spoken in prior meetings, things like, uh, i will be approving the manager selection criteria before we kick off a search in public markets. i review very early stage early stage in the diligence, a teams, um, right up on a manager to understand what they're looking at, why it fits in their portfolio. and what are the key risk? it gives an opportunity to have a discussion early in the process so that we can address any issues. uh, as

we do our diligence. and we have solidified the role of the portfolio manager, uh, management group, which is the mds that head up each of the asset classes they plan important part in reviewing every investment because they provide broad perspective of the total funds. and so bringing this together again. key message for the board is to understand that before an investment comes to you as a recommendation, it has been thoroughly analyzed, thoroughly vetted and importantly, thoroughly debated . uh we have a robust dialogue with consultants and within our own team, pushing each other to make sure that we've evaluated the risk john our work and done the diligence. now i'll dig in a little bit more to those points, because, uh, flip to slide three. so who's involved in this process? the investment staff, which we have at the center is really the asset class team. and they worked with a lot of

individuals throughout this process. what we're showing here in green are sort of that what we're calling for this the purposes of this conversation, the internal oversight parties, so that's myself. that's the portfolio management group and operations and then we have relative again to the staff, the external oversight retirement board, general consultant asset class consultant and working with outside counsel in the city attorney's office, so you can see there are a lot of individuals involved in a line with with their expertise. so that's who the parties are on page for. what we talk about is what the parties do and again. this is all outlined in the policies that you all as a board have approved. so some key responsibilities of investment staff is to be involved in every aspect of manager selection, monitoring and allocation. staff are the subject matters, expertise and i'm putting together some data to, um, show that that show that numbers, uh

, by my current review staff collectively has over 350 years of investment experience that that is substantial. um with regard to external oversight, you you know your role well, the board sets the implementation framework reviews, investment structure, asset allocation and investment results. these are all very important and big picture items, but it's important to understand that that all drives ultimately which managers we choose, because you help us design that that framework and then you provide oversight on the decision making which is part of the core produce very duty. and then finally, the investment consultants make recommendations on investment policy issues. they assist them with selection and monitoring, and they are an outside sounding board. they will share where there are risks. they will debate with us, and it is an opportunity to leverage their expertise to get a broader perspective of risks, risks and considerations. so

turning to the next slide again. we've talked about who we've talked about what and i want to talk a little bit about when and where there are controls in our process. what we've tried to show here is a bit of a graphical, um, representation of each of the stages of the process of manager selection. and those are sourcing and screening, investment, diligence, operational diligence , investment recommendation and contracting. yeah at the center of all this is the asset class team that does this work, but at each stage of the process, we have external and internal oversight. where we have locks on this page. it's a graphical representation for you to understand where they're sort of decision point controls, where approval has to be made or review has to be done for it to move forward in the process. again here. i'd reiterate that overarching all these steps in the process, the board is involved in establishing a parameter murders by setting the investment policy statement. now

you may be asking yourself. what are these checks mean? what is done at each stage? that's what we've tried to capture on the next slide, and i will admit on slide. six this is an eye chart, and it is hard because there's a lot on here. but i know some people find it helpful to sort of see an entire process in one place, so that is what we provided to you. but i want to talk about in particular where at each stage of the process we have those controls. so for instance, during sourcing and screening, um we do have the annual reviews to talk about where we want to go for the year to talk about pacing to talk about where we're going to lean in and out of certain areas based on the market. i am part of that process. and we, uh you know, agree that this is the path work for the year forward when it comes to investment due diligence again. i am involved with his. what we're calling the go. no go if a team brings forward and investment idea that is not consistent with what we had agreed upon in terms of that

annual plan or is outside of the guidelines. or is problematic or has too many risks will stop. but more likely, it will better inform our decision and our processes as we do diligence to make sure we're continuing to ask the right question and again at that investment, diligence stage. we're working very actively with our external consultants. uh so soon when it comes to the investment recommendation stage. um that's when the asset class team provides to our portfolio manager group. the all the recommendations. so the consultant recommendation the consultant, od d report and the investment memo. and they come up with a lot of questions to ask her asset class team. it's a i mean this in the best way. it is a tough group. it's a tough crowd because because each of them bring expertise to the table and a total fund perspective and ask very insightful questions to make sure that again all these things are fully bedded. the pmg group will then concur with with the

recommendation and then it is open open ultimately up to me to approve that i take into consideration everything that the pmg has taken into account and i will take into account that the recommendation of the pmg so we built in and made more consistent each of these stages of the process to make sure that the review is robust. and then finally on the contracting side again where we have controls. we work with outside counsel and we work with cecilia and her team. they approve every document to form but we've enhanced the processes there as well. to understand what a contract ultimately comes to me. um, where? where is it? have we gotten into the contract? everything that we need. where does it differ from? from? from our standard. why is that a risk ? is that not a risk and i think we've worked out a good system to make that happen. so what i'm trying to convey, and it's a lot of detail. there's a lot more on

this page is that we've systematized that the process to ensure that that we leverage the expertise of the asset class team but have good and appropriate oversight. through our consultants through outside counsel and through the broader set of individuals, uh, at at, um it's in the investment staff , and i should also add our investment risk team plays an important part in many steps of these these processes and we're building out that team. so we have the bandwidth to make sure that we have that that risk mindset with every decision. on talked about oversight on slide seven. i talk about the actual responsibilities of the asset class team. i won't read through the slide again. this is all from from the guidelines that i ps that you've approved. um, but again, our teams often are

following managers for years before something comes to recommendations stage. they get to know these managers. they follow them. they analyze them. um and they helped god where we leaning out in and out certain years, based on their experience and perspective on on the market there conducting quantitative diligence, qualitative diligence , meeting with managers, etcetera and not only considering investment risk but operational risk, and all of that, then informs their recommendation in terms of how to size the portfolio. think about it. it's role in in their overall asset class. so a lot of words on that page. but but it's reflective of all the great work that the team is doing. so that's how we get to hire a manager or funding strategy. our work doesn't stop there were always monitoring very closely. the managers once we hire them, and that is what appears on slide eight. so um, it's an ongoing process. um the asset

class team does the work. they work with our risk management team. we work with consultants or attending manager meetings. l packs gm and we're addressing all the things that you see on this page, so not only investment performance but making sure that the manager is sticking to the philosophy. the process. understanding the risk and return drivers that they're acting consistent with guidelines so a lot there and there's a lot of detail under each of these boxes, but rest assured again. the work is not done. once we hire a manager, the work only continues. the last point that i want to make on slide. nine. is that investment staff myself. we are committed and we are required to then report to the board on many aspects of the manager selection and monitoring process that again fulfilled your duty of your oversight duty as fiduciaries on slide nine. wait, we detail um, all the delivery deliverables to you very

familiar with us because you've seen us present on all these. um i think in particular things like the asset class strategy reviews, which will have some coming up in the investment committee meeting in july are extremely important because that that is a reflection of the entire asset class decisions on portfolio construction and having time to discuss issues like that again. that's where the board can have, uh, a lot of impact. and so while we spend time on individual managers and $25 million investment, some of the things that are on this page that we deliver to you are uh, are very, very important. sort of wrap up my comments and i welcome questions. want to leave you with a few things? we have a good process in place to select and monitor managers. since joining this organization, i reviewed the approach. i've worked with the team to enhance that approach. we're looking to the subject matter. experts with the financial knowledge to run the process, but we have checks and balances along the way and

again as i started everything that comes before the board has already been very fully vetted and debated. um, before you see it. so that was a lot. uh it's a big process. we try to encapsulate all of it. and i particularly want to thank uh aloe tanya kurt david. ana. sorry um, who work with me to sort of execute the vision and try and get a very complex process down on paper to share with you and the board. hmm. just to comment. i guess if you were to look at extraordinary cost center. this is an extraordinary gossip. how this is allocated up box cross all those boxes in the terms of how we do our business. and, um i i'm i guess i'm safe in saying

that. you you drill down in the each one of these little boxes to find out whether they were actually costs are rationalized . right? so yeah. that's one of the. incremental i mean inherent parts of the deal. yes and i think we included in our budget proposal sort of a return on investment for the returns that were able to achieve by by investing across asset classes, investing in private markets, and it is a significant risk are sort of return on that dollar investment. i think i would if i would circle back to go to a primary thought that i have in this area. is that in, for instance, in all the work that we go through these boxes. to put a investment to the board for their consideration. to make that investment. the packet.

sometimes can be like this. and someone comes gonna be like this, and that's just what we're getting. you've got probably reams of data and whatever that staff is using to come to the conclusion that you want to make refer to make that investment. so, um. that is, um in the area of opportunity. probably and we've talked about that. i think that's an ongoing. um. challenge that you're looking at internally. and where we're getting the most. oversight advice. thanks for the buck. and so. but this is great, you know, love it. um thanks for doing

this. document this way. and i'm gonna make a couple of observations. but the fact that isn't a bridge. representation of the i ps is great. i like pictures, much more so than words. that's not why i don't always have a lot of respect for lawyers. but pictures are easy for people like me. no offense to the lawyers. one clarification i want, though, is the phrase back on page seven. just one of the again this is i know it's a discussion about determine ability to meet spirits objectives. can you just clarify that someone make sure i understand. that's a very important statement. specifically ties to investment objectives, as outlined in the investment policy statement, so both the objectives i think for the total fund and for the asset class that objective, which then leads to how we invest, okay, um

thanks for thinking back on page two, when you sort of list page for all these. but the internal team slash investment staff doesn't. many many complex task. oh, i know that in one sense. doesn't represent everything staff has to do, but i'm glad you see you have fish. you've managed risk. there, you know. the order doesn't represent how important anything is. that's one to the one missing piece of the puzzle. i thought again. this is a discussion. it's not meant to be complete. but one of the active decisions delegated to staff. is the issue of how much leverage for polio to get and how it's been to invest it. that's a different that's actively investing that's not monitoring that has to be monitored. so to the extent this becomes represented, going forward. we have to figure out how to included. so we understand. this really helps support understand all the things staff is doing little to appreciate all the time it takes

to do these things because, for example, the managing risk is not. it's not simply a manageable quarterly earnings semi annual report. you guys are on it 24 hours a day. so again, that's just one of the items about this great document if i may address that point to clarify the intent of what we show on page four, is specifically responsibilities as they relate to manager selection and monitoring, um and does not . we didn't intend to capture on here. the how we address leverage in our systems and processes there. that's something that we're working to enhance, and we can come back at some point and provide that. okay that's that's a useful clarification because the point bullet point there about rebalancing assets that's again. rebalancing is a that's one of the ways you manage risk because guardrails or guidelines that you're giving. you have to do that. there's another aspect of . the authority staff has to do you're able to move money within

an asset class. those are active bets. that's something else that we the board has to make sure that's being monitored. your reporting and consultant is watching that thing. it can be a significant amount of money after a while again. lot of tasks. a lot of responsibilities . it always come back. we giving you and staff enough resources do that which means time and people and being compensated correctly. how this represented in one sense the process. i used the phrase um increasing value. increasing enterprise value, which usually most people think is finding another opportunity for investment to make and invest. one of the less well understood items is improving the process. much like hiring more and better people. leads to increasing value. and it's a whole range of issues making is a good place to work. a place to

stay where you're gonna be respected. we can really use your brain to help us. make more money and, more importantly, manage risk. so again. great document. thank you, um. i would say it sounds like if you this is representing the process. that you can see where how to improve the process. along the way. we'll also increased value. thank you. any other commissioners. i have one other item to c i o report that i wanted to mention, but were there any other questions on fun? um so the last item that we have, as we have every month is the planned value report. um and in the spirit of transparency, um i do want to bring something to the board's attention. um we've talked in the past about the denominator effect. and you've understood why we've been overweight. uh, private equity. um. but there is one other area

that we are underway and we're underweight relative to the guardrails and that is on treasurys. um and. we probably at some point will come back to you with a proposal to maybe consider both treasuries and cash together and our exposure there. the reality is in this interest rate environment. um you can get return on cash. we're not often sitting on cash . um but the way that we are going to probably manage it going forward is to think about cash together with treasuries because those that those are the assets that we're looking to get liquidity for. so while we are a little underweight when we look at what we have on cash balance at any given point with the treasury's, we're still well within those those guardrails. so we will come back to you on that. but i wanted to just note, uh, that because there's a lot of numbers on this page, and i wanted to make that clear. any questions on that. it's a

curious then how do you count the numbers because in the last few years we get that large of influx of cash in july. 85 but that then allows the team to use that cash is i, uh, collateral to use derivatives like leveraging. do you count it that way when it's invested that way, or is that that minus number? perhaps we can go through all the math. maybe i'll flying, but we're we. we do calculations for herself that look at cash cash. that's collateralized. what's your cash? what's caches collateral? what's unencumbered cash? so all those things go into the equation when we were getting cash in, for instance, in the end of june, we then say we're going to get this much cash. we predict in the next two months we're gonna have these outflows of capital calls and then we make a decision based on whether or not we want to

equitized whether we want to keep it in cash treasuries, etcetera. that's based on the market environment at the time of the flows. okay, thank you. any other commissioners. any other comments, madam c o c. i o yes, in this instance c i o it's everything i had given the item . at different hats should just put him on when he tried item comes up. okay, great. any member of the public wish to come in on this item, seeing non public comments closed. secretary please call the next item number 14 action item recommendation to hire wilshire. advisors llc for general investment consulting services. chili chili, usually. chile bingo. he called it off my cold.

are you gathering? there was a little cold, right? a. j is not . he's got that big beard. please go ahead. turn the light off. it's weird. it's counter. it should be off. counterintuitive yeah, it's like the light off and then the microphone comes on. all right. um. october 2022 retirement board meeting the retirement board approved staff's recommendation. rfp for general investment consulting services to support the board and staff. um. in in general investment consulting reviews. steph conducted rigorous, multi face due diligence process, including review and braiding of the rsp responses focused virtual interviews intensive on site due diligence. multiple

demonstrations of analytical and performance tools. reference checks, interviews with first ceo c i o and lastly the room sorry. yeah yeah, sorry. we would have just lost quorum. go ahead. i'm sorry. go ahead. and the last, uh, phase of the rfp review was at the april board when the semi finalists presented the second finalist, um, presentation, uh, was from paris and wilshire. there is presented a differential approach to asset and liability study and wilshire stood out with its approach, um, robust approach to capital market research. um. analytical in decision making four strategic asset allocation and strong risk management and e g practices. so

based on the results of this five ft screening process staff recommends that the retirement board approved the hiring of will shoot visors. for spurs general consulting investment services. um, we're here. to take any questions from the board. any questions, commissioners. yes you do. do commissioner driscoll. um. i'm going to support the recommendation, not because it's resigned to it. i mean, it's obviously the best choice. um no offense to the virus in any pc and the other bidders. because we always have the choice of not hiring anybody and going back to

the field. but again, and sometimes i felt that way based on when i review it, but these are strong candidates will sure being the strongest um, there's always and item would there have been one or two more pieces of information that could have been gathered. that would even prove that point further, for example, how well have they performed as the ceo for some of their clients because that would capture a whole bunch of other decisions, some of which would align with what we're expecting them to help us with. it's not necessary, but it's when you read stuff, it always makes more questions come up. there's always that quality issue. the time it would take to get the answer questions are not worth it. it's not going to change the basic decision or the basic recommendation. so the fact that will share is very. technically advanced compared to their peers have invested a great deal which will be benefit of us in a sense where a more sophisticated investors who can really tap into those resources. i do. staff has already been doing it . i think now you're going to be given that even a better greater tool that you use. thank you for

warning. you always just drives us to expect more work from you, but that's the way it goes. the thing i was concerned about the with wilshire since they have a corporate culture. they do have a low turnover of their key people that were interested in but the fact that their new owners took them over less than two years ago. well that sometimes it takes a while for things to change. no. one with investment bankers are taken over by somebody, not from the industry. every time and i'm talking about five or six cases where it's blown up on us, and we wind up having to fire the manager. we hired big and it relates to an ownership change. um do you have any doubts about this going forward because the lead consultants are been there with him. 18 20 years will they stay? very good. very good, uh, consideration, commissioner driscoll. and we did debated a lot. um and we felt that one we hire wilshire. we also work with their research team with their

data analytics team with their risk management team, not just one consultant representing the relationship, so we feel that while they presented very good, um, team on the consulting and client front front facing. we also feel that there um. cool expertise that supports this consultant. is, uh, is very strong. okay there's a slightly difference. um. use the word outside allocation development. well, shares was robust. viruses was everybody fraser used but another positive phrase but different my question comes back. to the strength and weaknesses of at least the two finalists. they have slightly different strengths and weaknesses, but it particularly from your reference calls to the former clients. did you pick up any weaknesses that are important such that? not that

you wouldn't recommend it. but if that was a weakness in an area that we need help do you have a solution or substitute or something like that? both were referenced very strongly and we again that's why we felt very comfortable bringing both semi finalist to the board. uh, in april. we do feel that the support team is much more a bust on the, um will show team and the other thing is the wilshire came up with that kind of total proposal, which is more, um, competitive. so let me re ask my question to make sure i understood your answer, do you? did you did? detectives cover any weaknesses in wilshire that it's okay there they they run their own company, but that that's a service. we need to make sure we cover another way. no very complete. okay? complete

for our recommendations from the rfp, and actually, they offer one beyond what we set out in the rfp. okay if i may add to that, um not doesn't comment specific to wilshire, but to our process. part of the reason that we separated out the public market consultant from the total fund consultant was to make sure that we got the best of both and didn't have to make a trade off . uh um to get the best board consultant, but maybe it wasn't the best asset class consultant that in some ways, i think, um just knowing the industry that that sometimes the sticking point where you're you're making the biggest trade off. and so this gave us the flexibility and bidders could bid on one they could bid on both. so we've resolved that issue through the process. uh, that's good. i'll say i proved that point by we had to fight to unbundle certain

things along the years when we unbundled, for example, are deferred compensation program. the money went right back to our members. the money we save significant amounts of money were safe. so this is our money saving thing is are you getting the help? the expertise. we need to help you do your job better because when you're doing it cutting down risk making us more money, adding value. that was the objective if you did that great. so i put it this way. then i did ask a question when they were here. i read it again in their rfp. their approach to developing their understand for them to understand our risk tolerance, which we have to understand. i look forward to that. piece of the work when they're on board. that's one two. um i look forward to access to their library, which they've made said they would make available to all of us. and three they will let you please. if you asked them, or they insist on doing some editing of

our investment policy statement . great but please make sure he's presented to us in the same format. that ms. romano just presented all the terms of reference. it's so much easier to read. last time there was a problem. there's so many changes you couldn't keep track of all the changes just makes it hard for us to read and vote and approved. if all these things lead with meaning, hiring wilshire helps and leads to our investment team. improving the process. and making better decisions. it's a great recommendation. thank you. okay. the other questions. commissioners. that concludes my questions. great. the other part of your presentation. it's a recommendation, so we expect to vote to approve. second. think public comment on this item. seen them from closed. um motion

has been made by commissioner. alphonse secondary commissioner driscoll. those in favor say aye, aye. supposed seeing now. motion passes menace secretary next item. number 15 discussion item 2023 annual liquidity management update. we want to show. you sure? yeah.

oh, let's take this taking care. movement is good and share. it doesn't show, though. see it on the screen. do you see the presentation? let me do mine. thank you very much. okay? so um, we'll walk through the liquidity management

. i see. okay? liquidity management, um isn't any well, including the management is continuous process for staff, and we also present an annual update to the board. and so this this is an annual update. there are lot of details here, however, i'd like to first get a broader view about liquidity management process and then, um just highlight the key takeaways. so we'll start with the overview of the process. spurs liquidity management process is outlined in the three pillows we review. in mortal, the cash flows from private investments. and this is very important because first has a very large private investment portfolio, private equity,

private credit and real assets and the this is mostly a portfolio that invests in what's called drawdown vehicles where the managers can draw down. um distribute cash opportunistically, so we need, uh, we actually put together a number of models that help us. predict and forecast the cash flows of our large private portfolio, so that's killer number one. the third pillow, um, that feeds the into this process, um, and in the right is the forecast of our pension obligation. this is where we work very closely without actuaries. um and also last um. presentation you've heard from an abc when we reviewed the liability side of the asset and liability study. and what we always look at is not just the base case, but also the stress cases. um under, uh, different

conditions, and so then we can collect all those forecasts from , um, the. yeah. sh cash flows to and from private portfolio. as well as expected pension obligation and review our liquidity position again. this is the ongoing process, but what you see in this report is the annual report of this expectations, so that's when we review how much liquid acids do we have? what what is the amount of this assets and under different stress conditions and do we have enough to meet different? um, different, um. positioning of the portfolio. and here i am not going to go through all of the details. i'll just get the highlight. and if we go to page four, um that's first trust has adequate

liquidity to meet obligations on the different stress conditions and we considered multiple stress conditions. i'd like to kind of zoom in and what's different in this report versus the kind of the key takeaway from this report. probably have sufficient liquidity. ah to meet . um our obligations, current liquidity, environment and private markets are stressed. and we wanted to calibrate and understand house trust, is it? are we close to financial crisis or 2008, which was one of our kind of higher, stronger stress scenarios. are we in? well we're the assets are not growing and managers are kind of backing off, which was the stress case that we called no growth. um and that's where we worked very closely with our partners and

our consultant, cambridge associates. um they are our consultants for all private investments. and we're able to work on, um castaic model to valid projected cash flows. and so the court outcome there was that the gfc type scenario is a really big, it's just scenario. more like one in 50 year, maybe one in 20 year type scenario, and we're not there. and i would , um, less, um stressful if you will assist scenario, which is the no growth scenario is e lower quarter tiles, types of stress, so it's a one in five europe one in four year a type of scenario and that's where we are. that's where we were managing to last year. when we evaluated the cash flows in 2022

2 in from our private before leo , we've seen that actually the liquidity conditions where below this, um lower court child, and they were closer to one in five years, one in six years event. and so what we've done, uh, working with cambridge is to make sure that currently we're managing liquidity. closer. to 15 percentile, which is one in 71 in eight years scenario, and that's where that that's kind of calibrating this to castaic modeling help us calibrate oh, you know, it's stressed. we know we're getting less distributions , but it's not gfc. it's also not kind of the no growth stepping back. we need to have can you guide opposed to how are we going to manage our liquidity day today and plan? point forward because it affects the

pacing annual commitment. piecing it affects the projections of the asset allocation. so that's the key takeaway, and we're very grateful, um, to cambridge, who provided this sophisticated model work closely with us and frankly, everyone here, um, helped cambridge because there is a lot of details, so that's that's the big piece. what's what is it that we're doing to address that? um that outcome of the stress. uh environment, liquidity environment we are recommending well, we're we're. together with the c e o. c i o as well as um, cambridge consultant and stuff. we're reducing annual commitments. to private investments by about 10% to be precise. 11% 350 million. so last year, the budget the

annual commitment budget to private investments in aggregate was 3,000,000,003 point. oh five billion. this year. it's 2.7 billion, so it's 350 billion less in aggregate and it's across all three private asset classes, private equity, private credit and real assets. so these are the steps that we're doing another reason we are comfortable, um, managing to lower commitment. is what we reviewed. i thought with the board lot, uh, during april asset and liability study that. this. this tension obligation piece is growing right? so the net outcome do you two out of the plan? pension payments is expected to increase. as planned, matures. and as a result, we need to, um the

liquidity is a logical situation and we need considered decreasing allocation to privates. so this took a sin durations kind of the maturing plan and, um, challenging but again something that we manage, but liquidity liquidity in the market for the last 18 months. lead to reduced pacing. these are the highlights. we do have cambridge associates on the line. if you have any questions on the details i appreciate there are a lot of details in the report. and it's our annual um, report to show you the, um the adequacy of liquidity and liquidity management framework. questions all right discussion item. it is a lot of great and

so please feel free to reach out . i know there is a lot but the this is something that we've discussed regularly. um and that's why i felt that in and we discussed it with alison. we could assortment. make sure thank you, joe. thank you couple of questions. it's just to make understand that some of these things lead to affecting another major issue. it's good that cambridge worked with you projecting capital calls i would understand just a routine thing for them. but what about all the other issues about did you use any pc at all? we didn't use any pc with asset and liability study that we presented cash projections. cash projection rule will work closely with cambridge capacity or skill that well, she would have yes. yeah and a pc also incorporated as we presented we, we work very

closely with an abc to incorporate cash projections, but we ultimately took what cambridge yeah, that's because cambridge is our consultant and plugged it into an abc s, um, snm liability study. i didn't know how good they are an economic forecasting now. so it's fine to use them. they're also a great source of information. the question, then becomes this using that below 25% title assumption. uh, that's a assumption of where we think the economy will be which drives the market. the way that was developed was that developed by cambridge for us or jointly or how did you vet that? that's a that's a major decision. it's a major. it was done. uh, with cambridge developed the assumptions, but we worked very closely with them on reviewing the assumptions reviewing the mortar link and the data that leads into that led into the stochastic process. question.

did you accept? mm bridges, workers, you guys really tear it apart and make sure we agreed. we had multiple iterations and we also had reviewed at our annual review of, uh private investments and, uh, spend hours at least an hour. with with with c o. n c i o the next issue is then. that was with some of the updates with the asset managers. um and i figured out how you labeled. all the securities at three levels. mhm. okay, um. but some of these shifts would automatically lead to lowering the assumption we make about the rate of return. i know we're going to be doing that going forward but is or have already gone that far ahead to realize it doesn't look like much of what's uh, $350 million reduction in the private areas doesn't seem like a big would have moved the needle, but maybe it would have we gone that far is that that's gonna what we're gonna be working on the next

couple of months. if you look at the projections are like a 10 year projection, and so there is a lot of there are a lot of assumptions going on in here. and so we felt that at this point where we are, we're comfortable calibrating it by 10% but we are monitoring it. and also the other thing. commissioner driscoll is that that this is what we plan. would actually we also need to see what the market gives right because many managers actually pushed their fundraising. and so even though we had the funding, we prefer to not spend all of it. this is kind of the higher estimate. and if it could also add, um, just so it's clear to everyone. um it doesn't necessarily immediately changed your return expectations because you have to take into account if um, distributions slow and capital call slip. we still have, for instance, an overweight to private equity, so slowing down. putting a new money doesn't necessarily radically change in the short

term exposure to these asset classes and our return assumptions. um i do understand that. um, that's why there's 7 to 10 years. when you make a movie takes it will take a decade for it to be reflected at the same time. when we make that assume greater return assumption. we're looking that far out as well so it will be affected. the cash flow effect will be in the future, but we have to look that way when we come back and discount all that liabilities today, so they all go together. absolutely numbers are basically for one year, they may go up or down further year from now. so thanks for walking the process. i'm just reviewing the steps. and understand. great. thank you. anna includes my question. any further questions. comments just one quick question. so ana as we move forward, and to do, the allocation will go back over this process again right before them because with wilshire? yes, because this data point will change for sure. based on the markets. i mean, i feel good that you guys feel comfortable

with where we are now and based on the data we have in front of us, but i know as a market moves this these assumptions will change and we keep breathing, validating absolutely very fair point. okay that that's yeah. i'm glad that you're on top of it, and i look forward to getting the updates. liquidity reasons. we must constrain some of the investment opportunities for very logical reason, then plays out in the assumed rhetoric. that's true. another thing the balls. anything further questions? comments? um as you said himself. so a lot of data here but well presented. thank you. thank you. but your branches support system back there. should also sure thank

them. their assistance. george staff. to be sure help. we need to ask for public comment before we well. comments on this, adam . hearing none. yeah, i would come. it's closed. can you call the next item place? item number 16 discussion items. san francisco deferred compensation plan quarterly report. cuban 2020 and if i may make a elite in comment, i know diane and timur are prepared to present but i wanted to take the opportunity on this agenda item to share with you some fantastic news. um the plan sponsor council of america recently announced that 2023 signature awards for retirement plan education. and under the leadership of diana and her team and with the support of voya, the city and county of san

francisco with boy was, um, honored with second place in the events and workshops category. so thank you, diane, uh to the entire gc team savoia for that. done well done with that. i will turn it over time. no, i'm turning you over. how are you? thank you so much. vice president and thank you, ceo. c i o romano for those words. i'm glad you said something because i don't usually boast about our achievements. but that is something that we are proud of. we send steve moyer, who's our program manager out to florida to pick that up. and we're very, very excited. so thank you, um, just for context that is for our october um, national retirement security month. so that it always tends to be a very, very busy campaign, and we're already working on that for this year after we wrap up our targeted

fund campaign, which you guys are well aware of, so, um, with that said, i'd like to begin the quarterly report if it pleases the board. excellent do you get do you guys share that with our participants and beneficiaries? i have not. but we certainly can . i think it's good. you should cheer it, right? yeah. we actually have a list of a bunch of plaques that i put considering placing around our office. just to continue to motivate staff and to showcase you know the excellence of our work, so thank you for that support. so today commissioners . we are presenting the quarterly report, which is our most comprehensive update, and it covers the four main pillars of the plan, investments, marketing operations and the record keeper up. first is the investments category. i'm happy to report that the stable value funds crediting rate for q two has increased by 12 dips. 22.56% this rate is guaranteed for the

quarter and will reset in q three. stable value currently holds over one billion in assets . and as we have all seen the recent headlines the collapse of credit suisse silicon valley signature bank adverse republic has caused great concern for many investors. however i'm pleased to report that the stable value fund had no exposure to three of these banks. um and the only exposure was 10 pips of credit suisse with no 81 exposure. overall bank holdings are also limited to 11% of the stable value portfolio across 40 issuers, and any impact will be reflected in the q three crediting rate, which will be announced next month at the june board meeting. i've also attached for your reference galleries. q one commentary for additional reference and insight on the past quarter. now i'd like to turn it over briefly to mr greg sherman, our investment

consultant from kalin to provide a brief overview on this past quarters investment performance as you can see on the screen. this quarterly activity report is located right after the quarterly memo in front of you, and with that, mr anchorman, can you please begin? thank you. and good afternoon. just some brief comments that after a very challenging 2022 were both stocks and bonds were negative, with the exception of the stable value fund was positive. the first quarter of 23 came very robust, particularly the large cap growth, which was the biggest underperformer last year, bounced back very nicely in the first quarter. you could see it was up 16.87% a short time period, but outperforming the index. other areas of interest the fixed income market up close to 3. so a very nice bounce back from the previous year and looking at small cap in international, some of the value

managers trailed their benchmarks in the first quarter after very strong relative results last year, so again, it was a bit of a yin and yang between last year and this year, but by and large all those some up to be positive results for the target date. which really dropped on many of these core offerings to the participants of the plan, and you can see in the year to date column for the target date funds. they're all outperforming their respective benchmarks. and again, that's a great testament to the strong active managers that you employ in the plan. happy to address any questions, but again, i just wanted to leave some high level summary comments. any questions? that is the. that is the investment portion. i'd like to move on to the marketing pillar. there's no questions there. okay thank you. i'm happy to report

an update on our target date fund manager transition as you know, t. rowe price was selected as an incoming targeted from manager and a target launch date of july. 1st a direct marketing mailer was dropped via usps to all targeted fund participants yesterday. to inform them of this change, and the benefits include enhanced asset allocation. new target date fund vintages for retirees. increased bond diversification, a new tactical asset allocation to respond to market movements, all at a lower cost as a result of the glide path, effective july 1st. an announcement of this will appear on sf dcp dot org tomorrow and a follow up email to target date fund participants with an email address on file will be sent next week. in addition, all these participants have the option to opt out of automatic re enrollment, which maps participants into the target date fund, according to the established 65 year old

retirement age chart. for instance, safety personnel tend to retire earlier and as such, they would choose a targeted fund that corresponds to retirement age date age of 55 instead of 65. we have trained the field and the counselors to not only be prepared to explain the transition and its benefits but are actively engage police fire and sheriff with their option to opt out. we've sent out department emails to those groups and counselors will be available at select locations to assist and answer any questions with regards to this transition. we will also be hosting and in person targeted funds seminar on june 8th here in this building on the fifth floor, as well as two webinars on june 13th and june 20th for those participants who choose to attend remotely. webinars dovetail nicely into the next pillar if there's no questions on marketing operations. we are excited to

announce our new webinar schedule. going forward sf dcp webinars will be offered every wednesday from noon to one with rotating topics weekly. you can find webinar details in the memo , and they'll include topics on tax strategies to raise their retirement and sf dcp tools and web demonstrations. any c csf employee can attend these helpful webinars by simply registering at sf tcp .org. and also attached for your reference is the sf dcp cuban newsletter. that is towards the end of your materials. um i'm proud to report that this newsletter has the highest open rates of 65% since we've transitioned to voya for context, this open rate is very, very high, even for us because we benefit from higher open rates given are engaged, participant based for context, the email open rate is nearly

two times and all industry average of 35% so clearly this newsletter hit home with participants and it's possible that the subject title also grabbed their attention, which was tips for your sftp account. um we also had seller conversion rates of over 10% conversion mates basically track when a receiver clicks on something within the male, so that's they were actively engaging, and that is 10 times the industry average of 1. so we are very excited about this because the newsletter covered many interesting topics, including taxes, as we're approaching taxis in as well as the increased rmd age to 73 as a result of the secure two point, oh legislation. and a brief update on secure 2.0 on that topic as the board has been informed earlier this year staff is tracking and monitoring t