This is the regular meeting of San FranciscoSmall Business commission it is monday, august 10, 2015, and the time is sfoufks it is televised thank you to the staff for televising todays meeting members of the public please silence our sfoenz and use of cell phones, please be advised that the chair may order the removal from the meeting room responsible for the ringing or use of a cell phone, pager, or other similar soundproducing electronic devices. Speakers are requested 42 not required to submit a card please deliver the speakers to me and the signin sheet for those who want to be added to the mailing list mr. President , commissioner adams. Commissioner dooley commissioner president dwight commissioner ortizcartagena is absent commissioner toursarkissian commissioner white and commissioner yeeriley mr. President , we have quorum general Public Comment time, members of the public may address the commission on items of interest to the public that are within the subject matter jurisdiction and suggests new agenda items for new items and members of the public who wish to comment on tonight agenda in today is chronicle an article about the expansion of no cars on Market Street i dont think this is very good for Small Businesses Small Businesses that are on Market Street and Small Businesses that want to do business on Market Street no yellow zones on 349 for regular commercial vehicles only 6 wheeled vehicles if youre a i have a business that wants to drop off anything on Market Street from the golf course to the embarcadero it is on boeblt no white zones on Market Street so both businesses having people droufl technically no place to do that and also the new signs that are depicted using o consciousness not wording and the thing it says okay for commercial vehicles a 6 wheeled vehicle so it discourages people with regular four wheeled commercial vehicles i dont think that is very good for the Small Business community thank you. All right. Thank you stephen well noted all right. Any other members of the public would like to comment on anything not on this earnings agenda Public Comment is closed. Approval the july 2nd approval of the minutes. I motion second. Commissioner adams made a motion all in favor, say i. I. Item number 4 discussion and possible actions for the recommendations of the board of supervisors on bos file planning code establishing a new citywide Transportation Sustainability fee this is an ordinance amending the planning code by establishing a new citywide Transportation Sustainability fee and spending the impact fee with some exemptions as long as the fee a amenable added a independence to reflect those and amending section 6 for homeless shelter exemption from the sustainability fee making and coming from amendments to the area plan fees and planning code article 4 and thats it presentation today is adam senior planner citywide planning division. If i may welcome. Thank you if i may before we start, of course, this here this commission were interested in what are the impacts on Small Business were all familiar with the situation in the city dont need too much discussion on the growth effecting us we want to discuss and know what are the proposed fee changes and how they effect Small Business so thank you very much. Thank you very much good afternoon good evening. Im victor wise im the chief of staff for the sustainable streets mta im joined by two individuals from the planning code i was going to give you an overview but quickly move through that to the question youve asked us about so power point please. Thank you i will stick to the slides on growth you know all that about that the Municipal Transportation Agency has been working hard to figure out how to accommodate all that growth and make sure the Transportation System r067b89 part of the program the Sustainability Program we 7, 8, 9 to talk about it is a joint program by the Mayors Office, by the Planning Department and the county Transportation Authority and the mta it has 3 components other mike is on if you feel comfortable. Thank you very much. The very first component the line it is really rising the Environmental Impact report under the California Environmental quality act a state level reform wheel not spend too much time on that only to say it occurs at the state level in 2016 the second part is the Transportation Management that has nothing to do with has to do with the development of the features to make sure that people have options to traveling different ways in vehicles and asking people to travel by bike and walking and transit we really need to provide the infrastructure and to provide the transit and bike facilities by to provide them and fund them thats where the fee part of program ill skip to that part of the presentation to give you the information ill unite adam to talk about this. While adam was on his way up changes that are not rventhd in the binder 0 so what you see on the screen may be different than your binders. Thank you altered from the Planning Department your last portion of that was accommodating the new growth. Making sure that people get around the city comfortably were calling the Transportation Sustainability fee an expansion of the impact fee and im going to turn it over to corey the assistant Zoning Administrator and our planning code expert youll talk about the specification of the fee and how to applies to Small Businesses as many of you may know theres a huge transportation need were asking the Development Partners to help to fund that as the city grows on the impacts of the transportation were proposing to place the where had with a new Transportation Sustainability fee it capitalizes that to expand the market rate no change to the nonprofits this is an issue that came up in profess iterations were building and standing the Small Business corey will talk about that generates 400 million in revenue in the next few years it goes go the system to help build the improvements more the trains to get around faster a portion goes to the regional partners and part to the building streets that are safe for pedestrians as well those are the proposed fee rates their based a nexus study were legally required to do and an Economic Feasibility study for the Economic Impacts across the r across the city to see the impact of the fee on the development and make sure that new investments are not costly to build another issue less jermaine for this body projects that have filed their applications in the pipeline were suggesting they receive a certain amount of gathering if youre in the pipeline youll get a discounted fee and that is part of the built in performance and maybe with a certain date so the records have to change thats a highlevel of overview im going to turn it over to corey ill walk you through the exception how that effects Small Businesses. Good evening, commissioners im corey the assistant Zoning Administrator i spend a lot of time with the impact fees one of my jobs right now to keep track of the current policy credits that we receive applications for for the 81 d f ill go over first of all, the main changes that the t s f changes that will impact Small Businesses the first thing the second point we dont have a blanket Small Business exception but policy comments for Small Businesses but a moderny limit of 3 percent every year for the policy credits so the new ss f eliminates that the Small Business exemption that applies it is a significant change for Small Businesses second big change is that we are collapsing our land use into much fewer categories for the impact fees because as many of you may know the t d i f was created in the 80s before the impact fees in the administrative code by mta this didnt move into the apply department until 2010, 2012 were thank you for the opportunity to try to correct that to illustrate this on this slide on the left youll see all the land use or technically theyre called Economic Activity areas that we have to deal with today, there are quite a few on the right the 3 symbol categories we use in our other knocks and using the t s f the residential and nonresidential pdr the interesting thing about the list on the left except for pdr they fall under the residential that collapses the uses down but often means fewer instances in the future where a change of use will occur per this code as a trigger for the fee other issue that is relative to the change of use the existing t d i f if you want credit it is for the prior it had to be active within the years ever our application if you imagine there are a lot of places that make that for a while and that was off in situations people come into for example, converting a pdr to a retail if not an active pdr actively occurring in that space in the last 5 years they dont get the credit they pay the whole rate that is consistent and proposed to being removed those are the 3 changes that impact Small Businesses the most i can go through the triggers and specific in that area as well. So again generally, the fee who applies to all nonresidential the Residential Developments creating 21 or more dwelling units and large nonprofit private universities with the institutional master plans will be subject and there which is a charitable provision in the std f were essentially fact that away if the large nonprofit that universities who does it not apply to the restricted and middleincome housing as part of the explore housing if youre got 2012 permeation of the onsite units are affordable if youre building 81 percent of the units and their derestrictive that will be exempt from the knees inaccurate 20 or fewer their examine and less than 5 thousand square feet well get into the detail in a moment and again, the way we treat nonprofits will stay basically, the same explicit for the large nonprofit universities so when did the if i and the triggers to trigger the fee any new construction greater than 8 hundred square feet thats the vast majority and similarly expansion or additions to building larger than 8 hundred square feet anytime under is a change of use and generally from the lowest to the highest pdr well take the highest rate so looking at the Small Business exemption to point out this is essentially the way it exists in the t d i f it politics all the time the pdr use it expands less than 5 thousand square feet will be exempt and 5 thousand is the key and nonresidential that resonates within an existing space for example, retail use for the pdr use it ultimately is 5 thousand square feet less than that is exempt and they dont apply to the retail so pdr to retail for example, starbucks that would not be exempt so a few Common Development scenarios one is that kind of the change in tenant more than a change in use for example, if you have lets say you have a Corner Grocery store on valencia street to convert it to a toy store not a change of utilization because we were able to collapse those uses including the office and retail and medical and institutional you can go in and out of the changes and not a perfect impact fees so in this situation no fee applies no expansion and no change of use so what if you want to capitalized to Small Business maybe youre adding into the building again as long as the ultimate result of the expansion the use and business will be less than 5 thousand square feet the fee will not apply i want to mention a little bit elder a change of the use from pdr to retail as long as it is less than 5 thousand square feet go into a former you know Warehouse Space in selma are you or a trendy coffee shop less than 5 thousand square feet not subject to the fee something important to point out excuse me. We are actually going to be image doing substitute to address the typo in the language the draft it doesnt make that happen fully only an error and caught already and on our to do list to get it done so the language is correct again that didnt happen your crux a new building for a Small Business it will only not apply for a building less than 8 hundred square feet an example the pictures are proximity and for the substitute a fee if their large enough generally buildings more than 8 hundred square feet are subject to the impact fee this is common if youre leasing space in this situation generally mother applying to the business because when that building the Building Permit was approved and issued for the new constructionists theyre generally determined the collapsing of the uses so all the impact fees are paid through the permit with the actual construction of the building often the 81 ti work is later so it didnt flow to the Business Owner taken in by the developer when the permit is issued for the new construction and with that, im going to turn it over to adam to complete. Yeah. That is basically the end of our presentation as you are aware mayor and supervisor wiener and supervisor breed introduced it on july 21st we did the introduction and will go woke backing no september and bring to 0 with that if you have any questions, ill be happy to answer them or answer any feedback you may have. Commissioners, any questions. In youre on the formula retail does it include franchisees fachz. Yes. That formula retail includes franchises any businesses that meet the criteria for the formula retail or the establishment they have otherwise theyll fall under that i should pout that is the way it is for the credits as well as long as we have Fund Available you cant receive it if if is a formula retail. Commissioner toursarkissian. I have a question about the threshold of 5 thousand square feet what does it include storage . A lot of those Retail Businesses included. Generally for all the impact fees we use gross storage which is our kind of most expansive category for the floor area it generally include everything from the exterior and for storage if you have a back storage room for stock or stwra space or the part time space that is in the calculation of the 5 thousand square feet. So possibly it can involve a lot of Retail Businesses because a lot of them voluntary large storage area 5 thousand threshold can capture a lot of Small Businesses with the commercial space maybe half 1 3rd and the rest stores a lot of restaurants basement have i screwdriver that possibility. Sure there will be some retail uses that are larger than 5 thousand square feet we dont very specific numbers on the proportion but the large portion of those uses are in the c district and the neighborhood corridor those tend to be you know just the ground floor and that is usually a maximum of 25 hundred square feet rather than large parcels that are definitely an opportunity for businesses to expand and go over 5 thousand square feet unto a higher number of formula retail that fall into that in the neighborhood commercial districts yeah. The same image the 5 thousand square feet threshold and the formula retail component were basically carrying that over exactly how in the counter policy of the Small Businesses thats the idea. Commissioner dooley. Can you go over the projects in the pipeline how those work in the 3 different categories im just asking about the project with the planning entitlements will not pay the existing t d i f but the Residential Projects quite large will not be paying any of the use; is that correct. Hold on maybe i can find the slide here. So essentially this is the consideration for projects have received their entitlements e. R. Submitted an application for the two departments the residential and nonresidential the residential uses which you may be less concerned with if they have their entitlements from the Planning Department this fee whether not apply there maybe other fees in place like the aerial impact fees theyll pay those but an application into the department were paroling proposing theyll pay 50 percent the fee rate for the residential use thats 3 sloping to 7 plus for the nonrestricted residential uses the projects with entitlements again not pay the new fee but if subject to the p d i f were saying the same thing for the Development Applications into the Planning Department if they have an application in were saying today, the rates that are there today hopefully that make sense. Can you give me a quick compa