one hat i wear is on the brewing company, we've been in san francisco 14 years, and the other is as a founding member of the san francisco brewer's guild. the san francisco brewers guild is a very small organization, there's seven businesses, we are the craft brewers of the city. we make our own beer, we make it on premises and we're in the unique position in which we're both wholesalers and retailers, only one of our members only sells retail and doesn't have a restaurant attached to their business. of these -- the seven -- just to give you an idea what we're talking about here, the seven businesses combined plus the breweries and restaurants, we do roughly $29 million in gross revenues in san francisco and employ over $5 -- 500 people and not insignificant but whatever. before i go into the details, i want to say, i'm a small business owner and i can very much relate to the extremely small margins we have to operate under. i had just last year, if i stood before you, i could say i own three businesses here in san francisco. i just have one and it's thirsty bear brewing company. it's very difficult to operate in this environment

i am here to represent my business and the san francisco brewers guild. we all support, or i do, personally, to maintain critical services in the city. the treatment and prevention. these are city priorities. i do not think this will bring results that it intends. it said that this fee would go to lower sales and job losses. there is the cost of chronic alcohol abuse. i feel that that study mrs. two fundamental points. the actual cost increases, one nickel per drink -- i feel about the steady mrs. two fundamental points. -- the study misses two fundamental points. there are declining sales, less payroll tax, and there is going to be fewer tourists to come here, and we need to increase jobs, and the city will get more revenue. wholesalers. this will hurt our ability to fund important programs. i feel we need programs to encourage sales in a very sensitive environments, and we need an increase in spending. [bell] >> good afternoon, supervisors. my name is -- with an association. we are here to oppose the mitigation fee. we do understand the situation with t

. >> i just got a letter from the san francisco brewer field that has broken down some of that as well and i'm just reviewing it. so along that lines of that argument, and i think the member of the brewers guild is here and i'll talk about that and be here to listen and really learn more about it. >> great. and i apologize, i actually have a list, so i'm going to go through. we're looking at significant fee measures across our small business community in the current budget, and i'm actually a little disappointed that the budget has such significant fee increases not including this, that is already in the budget. >> this is not assumed in the budget? >> i know. i'm talking about the budget and there are significant fee increases along with a group of tax measures that will be going to the ballot. so one of my concerns is a double or a triple hit to our hotel industry and restaurant industry depending on what combination tax measures pass assuming they all pass, hotels could be hit very, very hard, again if this fee is passed through and have you thought about that, the cumulative impact

. >> reporter: small san francisco brewers are alarmed because the fee targets wholesalers.ince they make their own, it could cost them tens of thousands of dollars a year, driving a beer up to 6:50, 6:75. the customer is going to choose to drink wherever, but why here? how special is san francisco at the end of the day when we're scrimping and saving? >> reporter: that message went to city hall today. >> this will hit the economy. >> reporter: as the fee moves through the committee process. >> the response we're hearing is somewhat irrational. supporters say san francisco is spending $17 million annually to pick up, care for, and rehabilitate alcohol abusers, so it's only fair those who sell it and drink it pay the tab. >> this is onerous for a consumerrer to pay 5, 10, 15 cents for a drink. will that cost anybody from drinking? no, it will not. >> this restaurant manager argues another fee could put some establishments under because profit margins are already thin. >> what's going to happen is instead of splurging and getting an appetizer, they'll forget about it. >> repor

. >> reporter: small san francisco brewers are alarmed because the fee targets wholesalers. since they make their own, it could cost them tens of thousands of dollars a year, driving a beer up to 6:50, 6:75. the customer is going to choose to drink wherever, but why here? how special is san francisco at the end of the day when we're scrimping and saving? >> reporter: that message went to city hall today. >> this will hit the economy. >> reporter: as the fee moves through the committee process. >> the response we're hearing is somewhat irrational. supporters say san francisco is spending $17 million annually to pick up, care for, and rehabilitate alcohol abusers, so it's only fair those who sell it and drink it pay the tab. >> this is onerous for a consumerrer to pay 5, 10, 15 cents for a drink. will that cost anybody from drinking? no, it will not. >> this restaurant manager argues another fee could put some establishments under because profit margins are already thin. >> what's going to happen is instead of splurging and getting an appetizer, they'll forget about it. >> rep

>> i think we need to address a number of issues which we had recommended that my crow brewers, local san francisco microbrewersies, should be exempted from this tax. as they would be considered distributors and retailers. i also would like to talk, to add the point about how formula retailers will begin to have a -- an advantage over the small business in terms of passing that through to their consumers , you know, at a time when we are trying to encourage small, locally owned businesses, it seems to be giving an unfair advantage once again to offsale retail stores. commissioner o'brien: i was just going to remind the director of commissioner duty's point also, the concern that we don't see a plan in this for eliminating a problem. we just see a revenue generating source and really what amounts to another tax. i'm really concerned at the strategy behind it because frankly i think people will just keep drinking and spend more. and that's what's going to happen. and it's not going to really do anything other than just make the place more expensive as it already is. i think it would be nice if there

additionally, i do work with small brewers from all around the country, and i have been able to convince some to come to san francisco because of what we offer in terms of our food, our culture, our diversity. whether they will continue to distribute in san francisco, this is revenue that already exists. it is likely to disappear january 1. additionally, i was having conversations with two breweries, and we put our talks on suspension, as well, until this has been solved. there were a variety of reasons, but it is more about -- i think this would be about small wineries, as well. thank you. chair avalos: thank you. next speaker. >> good afternoon, supervisors. i am brian. you guys have a tough time balancing this budget. my small-business colleagues and i know how difficult it is to balance a budget. we know all about that with fees and taxes, but what it comes down to is the bill before us as small businesses to have our margins and be able to make payroll, and that affects are staffed. yesterday, we distributed a copy of the legislation to the employees at our bars, and we asked them for their comments come in 1 st