fees are not based on a fee study and do not provide for full cost recovery. before including the small businesses count for which most businesses are eligible. the average cost for a fixed park lit is $4100 per permit and $2000 per annual license based on the current year program costs and lost revenues totalling 7.66 million and 645 permits issued. uh in this year, the cost per permit is approximately $11,900. we also have a note about programmatic data. um administrative code section 94. a requires collection and reporting of programmatic data, including data on time between permit application and issuance , participation and user feedback data reporting on revoked permits and compliance audits of existing shared space permits. the documentation of this work was not available for our team's review and the work. does not appear to be underway. the mayor's office of civic and innovation is currently building

a reporting tool that will aggregate program data from management analysis and we recommend that the board request a report from public works m to in planning on the performance of the program. and finally, um , we speak to the role of the planning department in this program. under administrative code under the administrative code, the planning department is tasked with general coordination of program activities, which was provided by a project manager. one position, which is vacant as of this month. the board of supervisors could consider amending the code to remove that responsibility from planning and deleting that position, providing annual savings of about $250,000. we do note that public works and m to each already have a senior management staff assigned to this this program. dpw has a manager seven and m. t. a. has a transportation planner for, um and we will be noting our recommendation for that project manager one in planning, um next week when planning comes back

and we do consider approval of the proposed ordinance to be a policy matter for the board. thank you, vice chairman delman. thank you, uh, chair chan, and i am sympathetic to this ordinance, although i don't think i am prepared to support it today. uh as it currently stands for, um, a few reasons and i look forward. i mean, if anybody else shares these concerns, i'm looking. i would welcome more conversation over the next week. um so i remember being quite involved in the standing up of this program back in 2020. i was quite enthused about about it. i think i was the lead co sponsor of the mayor's legislation making the program permanent. um you know, i think then supervising our president. peskin had also taken a great interest in the program. we did not always agree about every aspect of it. um and one

of the things that i remember from those conversations is that although although i was supportive of the shared spaces, they did not come without. cost um and that in every neighborhood that i represent where they have gone in. they have been a boon to some and others have felt that they have been a problem. um for retailers, who see, uh at the park. let's allowing active, greater activation in the evenings after many of these retailers are closed, um they were frustrated. i know for the m t a for going on average of $4500 parking space in, uh, meter revenue at a time when they are facing tens of millions of dollars in shortfalls or more , um, was a concern remains a concern and the fee structure that we ended up with in 2021 or

whatever year it was was definitely a compromise. i assured some of the opponents of shared spaces that well, at least these folks are going to be having to pay something that it won't be as much as we would get from the meter revenue, but it will be something and it will be a disincentive to focus people. you know the people who are opening up park, let's we'll at least have to think ah, about whether it's worth the expenditure to then take over that parking space. now it may be. you know, covid is not that far behind us. it is difficult economic times. maybe we want to. maybe we want to provide more relief. going forward. and maybe it's another year, but i don't know that it is a perpetual relief from the permit fee for anyone who comes along in the future to open a new park lit um. and i also say that in the context i mean, we're having lots of conversations right now about how best to help small

businesses. there's a question about the first year free program, which we have committed to, um which we want to be able to fund going forward. um, i realized in investigating this item that we have allowed the tables and chairs waiver to expire. um if i were thinking about relief that i would want to provide to restaurants and cafes that does not have any of the costs. to m t a at least in terms of foregone revenue, and to, uh to alter to retailers in the neighborhood. i would think that waving the tables and chairs fees would actually be you know the up move before i would further reduce the park late fees so that's kind of where i am. that's why i'm thinking we should maybe kick this around a little bit over the next week, and maybe think a little bit about the tables and tables and chairs, fees and, um that's kind of what i would a

conversation i would be interested in having having if anybody else in the committee is interested in having it. thank you and director doing any thoughts. just one comment. i just want to acknowledge them. not sure if this was in the b l. a report that the reduced revenue is not currently assumed in the mayor's proposed budget, so it would come to move this forward would come at a cost because you'd have to reduce the revenue available to dpw. thank you. um generally speaking, i just wanna talk really quickly about fee waivers just all across the board colleagues and you have heard me saying this about even awning like which is very minimal. um awning free waiver for like, you know, small businessman the month of may, you know, without colleagues, supervisor and cardio, and i just wanted to again articulate my approach to this that i just want to be consistent. and i would really like to see just all general like it doesn't matter. the waivers who just limit to the next two fiscal years and across the board and

because i just again, you know, with the revenue letter that we had this discussion at the beginning, we just don't know what 2025 actually looks like. i just really thought that we should allow an opportunity to have those discussions. just allow ourselves to have that opportunity to have that discussion about these waivers. whether they're working or they're not. now that's one thing and then the second thing is what it sounds to me. um what was very similar to first year free that second year was not funded. and now that we as we learn that this would come at cost, which is about $1.4 million, i think from the b l. a report which also eliminate a positions at the planning department. uh and vice chairs man woman has some ideas about waiving fees were tables and chairs because that may be what really helps. in the smart business if that is ultimately our goal here. so i'm hearing, you know a lot of thoughts and

um and this still needs to go to public comment, and so i do would like to go to public comments. i would like us to think about whether we could continue this to the next week, but i also would like to actually make the motion to a man. um you know, and support the amendments that supervisor so far. he has already proposed today and that at least we take care of that today. so with that set colleagues, i'm going to go to public. comment on this and mr clark, let's go to public comment. yes, madam chair members of the public who wish to speak on this ordinance regarding the permit fees for the curbside shirt spaces program, uh, and are joining us in prison should line up now. half for those who have joined us remotely and haven't already done so. press star three if you wish to enter the speaker line, and for those already in the queue, police continue to wait until the system indicates you have been in muted and that'll be your signal to be in your comments, saying that one person speakers here in the chamber ah, mistaken love. if you can admit her first of three colors,

please. hello supervisor. my name is judy gorski. i'm from district four. first of all, i would like to join all of you and your complemented interim director carla short and that really amazing presentation that blew me away as to the scope and amount of work done by public works. i really admire. that department and all that they do . um i'm calling to ask for your support to fund um option number three and public works standards . i just want to let you know. i'm sorry, judy. i just want to hold your time and pass your time. this is not about this is not the public comments about city departments. this is a public comment specifically about share space fee waiver, so you may want to hold off and call back later for public comments for the general public comment. is that the place where

i would speak today? or is that a different game at the end? okay thank you. sorry sorry. i didn't understand. thanks. all good. thank you much. judy gorski. we'll hear from you later. ah! miss second love next color, please. good afternoon supervisors. my name is amy clary. and i'm, the director of public policy for the golden gate restaurant association. as you know, shared spaces has been essential program for the survival of many in san francisco restaurant community and a draw for tourists and locals alike. we are grateful to the city has recognized this and made it an ongoing post pandemic program. however our restaurants are still dealing with many financial challenges. and even in the neighborhoods, they are struggling with high costs, inflation and lower sales, given all of this pandemic permit application fees are daunting, very strongly support attempts to reduce for one year. the application fees, especially measures to waive the first

application fever businesses into the reason threshold for the 50% discount on fees and license costs. the 2.5 million and index it to the c p we strongly believe that the long term health program is essential to our industry. we want to ensure that departments that supported programs continue to be funded. so this program and sustainable for the long term thank you. thank you, amy clary for your comments. and just double checking. if we have any more colors in the queue. madam chair that completes our q great thank you. seeing no more public comment. public comment is now close. supervisor safadi. i'm happy to continue this item. i just want to. i want to state a couple of things clarify, uh, tables and chairs are separate from this conversation's who resume antolin a happy for you to have that conversation with the affected communities, but you heard from at least the golden gate restaurant association. we've talked to

hundreds of businesses and yes, it did. this is a pandemic related. ah economic related recovery proposal because many of these businesses are holding on by a thread, the idea of them now being asked to bring many of these spaces up to code and i was also a lead co sponsor and heavily involved in the conversation initially to make this program work, um and essentially, it did. um and it's been working. it's been helping a lot of businesses, but the idea that now they're going to have to pay thousands of dollars when they have to choose between hiring staff or paying additional fees. this doesn't eliminate thesis city. this is the initiation fee. and then there's ongoing fees that the city will recover the loss in revenue to parking meter and other conversations. that's a general impact of shared spaces existing so if people don't like shared spaces, that's a whole different conversation, but this is about allowing them to stay. and then if you talk to these

businesses, the amount of money that they're going to have to spend in our spending to bring them up to code because, remember, we allowed them not to have to follow. code initially, but now they are being asked to. that's a lot of additional money on top of the one time fee. so the idea of this understand now heard for the first time that the mayor's office did not assume this one time fee. um looks like there could be some money that you redirected from public works, which we put forward. there's a lot of conversations about where this money could be assumed. in the next few weeks, so i'm fine to have the conversation continued . but i do think this is an extremely extremely important, um, proposal for these small businesses and i do like the idea of what you said church in. maybe we reduced the window. maybe it's not in perpetuity, but maybe it's a two year conversation so we could ask the city attorney too, and i'm happy to talk with them about drafting that amendment. right thank you.

vice chairman delman. sorry but before i go to vice chair minimum, would you like to make the motion to make to amend the to a man that has read into the record, please. second that and then we'll do the roll call after vice chairmen, moments comment. um thank you. chair chan. um and i guess, uh, i do. i mean, i am very sympathetic to the folks who opened their park. let's during the pandemic and can see the value of giving them. um the ability you know in in the first year that they convert over to have those permit fees waived. i'm just not sure about continuing to do it over time for new people coming into the space. um and i do feel differently about that than i do first year free. i think first year free is a recognition that are permitting process. you know the struggles of getting through a first year as a small business anywhere are hard and in san francisco there really hard and maybe at some point we'll have

fixed that. but we're not going to fix that in the next year or two or three. and so trying to give that program some runway seems to make sense to me. i don't know about permanent runway for apart clips, and i actually don't think that makes sense. although i can understand grandfathering in the folks that did open and now have you know some expenses associated with getting compliant. great and, uh, so let's do a roll call with a motion proposed by supervisor sephardi and sacrum myself to amend the legislation as he mentioned. yes on that motion to amend the ordinance made by member safa seconded by chair chan, too. accept the amendments as offered by member saffet vice chairman tillman. man. i remember safa. i remember running corona. and i remember walton walton. i chair chan and i we have five eyes. thank you.

and i would like to make the motion to continue to next week. and second by vice chairman delman and roll call, please. and on that motion to continue this ordinance to the june 21st meeting of this committee as amended, vice chairman allman gentlemen, i member. so i remember ronan. running i remember walton walton. i church and we have five days. thank you. the motion passes and the next city department is, um building inspection. thank you. uh and while we have a building inspection also want to call item number 15, but i from what i understand that item. 15 has not been adjudicated by the building inspection commission and therefore we cannot take on. i just want to mention that it is on the agenda. so technically , do we do we call the item and

then? uh just not having the presentation and discussion and called to public commons or help. how do we want to how did he get on the agenda if it wasn't hurt at the commission? because walter through the chair to how members suffer, uh as part of the mineral budget. this did require a fiat and not knowing that the building and special commission only meets on the every third of this month wasn't entirely sure whether or not they were able to hear it and at a commission meeting they are scheduled to do that on june 21st and however, seized assurances that the commission secretary will get that letter to us before we before we call this item again, just through the chair just because i went through this myself, and it was delayed months because the technical advisory committee did not hear it before the commission heard it. and i asked that question to the director has that happened. you know,

that's that's correct supervisor did. the general way these things work as they go to the court advisory committee. then they go to the big for recommendation to the board. and, uh, i mean, regarding further legal interpretation, i guess we can know. my question is, has it gone to the technique? your technical advisory committee? i believe it went this morning to the csc. you don't know the answer to that. and i can check with staff. and it definitely hasn't gone to your commission. correct it did go to the cia this morning and they moved along to the big which meets next week. okay yes. so we definitely can hear it until then. no and fortunately, um, deputies city attorney pearson, could you help us understand what we need to do with item 15? deputy city attorney and pearson for purposes of today's meeting. it is on the agenda, so i think it needs to be called. it is subject to public comment, but the committee can just continue until next week and then act on

it after it's been heard of the commission. thank you. so let's go to your presentation for your budget. and of course, your first name last name. we know who you are, but for the public records, and then we'll go to public comments for item 15 immediately after your presentation. thank you. i'm sorry, madam chair i have yet to call. apologies let's call 15. yes 15, yes. as an ordinance, amending the building code to increase fees charged by the department of building inspection by 15. and affirming the planning department's determination under sequa how members of the public who is to provide public comment on the continuance of that ordinance. how should call for 156550001? who the meeting idea of 259109 to 6 to 45 impressed band twice and if you ever if you haven't already done so, dal star three lined up to speak. he promptly indicate that you have raised your hand and please wait until the system indicates you have in the muted and you may begin your

comments, madam chair. thank you. dr patrick. all right, um, the floor is yours. good afternoon chair. chen and members of the budget and appropriations committee. my name is patrick or reardon. and i am the department. uh director at building inspection. i'm joined here today by alex koskinen. he is our deputy director of administration and our cfo. now before we jump into our budget, i'd like to give you an overview of our priorities at b i, which includes transparency, accountability. equity and efficiency. as you know, a supervisor as we have been making improvements in all areas to restore trust in the department. this has been a top priority of mine. we still have work to do. but i would like to thank db staff for embracing our reforms and doing their part to make the department better and stronger. there are noticeable

differences. uh improvements throughout the department from improved permitting, take two new training for inspectors to technology. and administrative improvements. just to remind you of bees. core services db i reviews, plans and issues permits safeguarding life and property. our inspectors perform inspections to enforce codes and standards to ensure safety and habitability. we strive to deliver the highest level of customer service and to implement effective and efficient administrative practices as well as proactive, proactively engaging and educating stakeholders customers. and the public. so, uh, here is an r chart showing the makeup of d b. i the

department is generally made up of the three divisions, which includes private services, inspection services and administrative services. and as we build on our successes, db tracks and reports performance metrics for the controllers performance scorecards into five areas listed under slide. plan review. db. i tracks the time to first review for in house review projects over the counter permit issuance time. online issuance and electronic plan review. as part of mayor breach housing for all executive directive. some of the key metrics cbi is tracking for housing projects includes time for first review. overall issuance time. and time spent with b i during the permit issuance journey. for inspections are metrics are

inspections per day and complaint response times. our metrics for the department also include our customer satisfaction surveys and the time to process, public records requests, and three are reports that three hour report is simply a report of residential building record that is used in the real estate in industry when a sale is being processed over property residential property that is so, um. i know it's a tough budget year for everyone. but as a self funded department, db is facing a severe budget deficit caused by the downturn in the construction industry. d b i s revenue has fallen $25.8 million since fy. 19. that's a 31% decrease. and to underscore again db. i is an enterprise department that is self funded

through the collection of permit fees. the department receives no general fund support. i'll hand it over to alex koskinen to take you through the rest of the presentation and thank you supervisors. good afternoon supervisors. alex koskinen, cfo db. i before jumping into the proposed budget. for the next two years. i will present my historical financial analysis that will explain the department's current financial position and how we got here. this table shows three things, revenue expenditure and fun balance. as director of reardon mentioned d b is completely self funded, and it relies. it is completely funded by the fees that the department collects. any time that revenues are greater than expenditures that surplus falls to the department's fund balance and after the great recession in

2008, there was a boom in construction and revenues far exceeded expenditures, resulting in the accumulation of a large fund balance. however, uh, when the pandemic hit. there was a complete reversal and as you can see, revenues dropped as the director had mentioned and expenditures stayed relatively steady. the department is mostly labor and does not have control over most of these expenditures. and so the current state we find ourselves in is with expenditures far exceeding our revenue. we have a large deficit and we have been utilizing one time sources are accumulated fund balance to balance the past few years budget and we expect to completely exhaust our balance by in the next two fiscal years. this uh, chart also 11. other notable thing to mention is revenue increases

there have been two and during this time period. in 2007, there was a v study that resulted in some fee increases and then in 2015. during the height of the construction boom. there was a 7% feet decrease to recognize the fact that we the department was taking in more than it was spending and fees have remained . where they were in 2015 to today. this slide shows the department's entire budget revenues and expenditures. on the revenue side. the two main stories are ah! the volume decrease. we are projecting a further decrease in demand for db services, so permits and inspections of about 18% from fiscal year 22. and. to combat this into balance the budget or we have requested and worked

with the mayor's office to propose a 15% fee increase. that's item 15 which will be before you, and we appreciate and anticipate support on um, you can also see our prior your fund balance and reserves. we are utilizing significant amounts of that, in fact. the entire remaining fund balance is used in the next two years. on the expenditure side. the story here is major reductions and difficult choices because of the position we find ourselves in. the department proactively. made massive reductions to its budget. the department completely eliminated all continuing project spending. from $6.4 million in the prior fiscal year. 20 in the next two proposed budget years, no equipment. um. yeah, and massive cuts to non personnel services, including contracts. um. yeah i

t services peer over your services. and other other professional professional services and cuts to our very modest, uh, materials and supplies budget. we also have projected savings in services of other departments. we have attempted to identify any discretionary spending and reduce that. for the most part, the department doesn't have control over these services. it's building rent. uh it is worker's comp city attorney's services. costs that are dictated to us and then last but definitely not least. is our grant city grant program. the budget for city grants has been eliminated from our budget, and this is a very difficult choice and i really want to acknowledge the community members and the members of these organizations who have showed up today. um

this money is primarily for two programs. the code enforcement outreach program in the s r o program. ah, these are tenant and, um landlord outreach programs that the department administered all the money went to these two cbo organizations, and none is for department staff. and with that i'd like to hand over to director of reardon for any additional comments on the cbo program. well, i just like to say that, um. we wish we didn't have to do this, but simply put. we didn't have a choice. we had to cut $11.6 million and, uh. the only other option we would have is to lay off staff and eliminate some of our core services, which are mandated services and so far as we provide inspections and issue permits and conduct code enforcement. so. like i said, we

really had no choice. i wish we didn't have to do this, but, uh , we're a fee based, um. self funded organization, and we simply just don't have the money to fund the programs, unfortunately, and like, alex says. we will work. as diligently as we possibly can to serve the community and to conduct inspections for habitability, induce buildings and, um conduct outreach to that community as best we can thank you. thank you for pointing out just the magnitude of the expenditure reduction as you can see here. almost $12 million difference between fiscal year 23 budget and proposed fiscal year 24. this slide pie chart of our expenditure budget really highlights the major categories . the