Transcripts For SFGTV BOS Budget And Finance Committee 20240

Supervisors Committee Rooms are closed. Members will participate in the meeting remotely as if they are presently present. Public comment is available for each item. They are streaming the number across the stream at sfgovtv. Each speaker is allowed two minutes. Comments to speak during the Public Comment period are available via phone by calling 888 2045984 access code 3501008. 3501008 press pound. You will beelined up in the order you dialed. While waiting the phone will be silent. All callers will remain on mute until the line is open. You must account for timely days between life coverag cover coved streaming. Turndown your radio. You can make Public Comment by emailing me linda. Wong at sfgovtv. If you submit via email it will be included as part of the matter. Written comments may be sent through your Postal Service to city hall. Finally, items acted upon today will be forwarded for full consideration on may 12 unless otherwise stated. Supervisor fewer thank you, madam clerk. Please read items one and two together on the budget and finance committee agenda. 1. Resolution authorizing the director of property to exercise lease amends for leases of Real Property at 3119 Mission Street and 3120 Mission Street for office and Service Space with klw investments as landlord each for fiveyear terms to commence on july 1, 2020 to expire on june 30, 2025 at the combined Monthly Base Rent of 203,231. 60 for a total annual base rent of 2438779 with base rent increasing 3 per year. Two. Resis solution authorizing the director of property to exercise an option to extend a lease of Real Property located at 2 gough street for office space with rachris, llc as landlord for fiveyear term. Call us to line up to speak. Thank you. You may remember the two items one and two were continued from last weeks agenda. We heard these last week. I believe last week we had supervisor peskin also joining us. You might recall that last week we heard these items and asked the director of real estate to go back to the landlords and ask if we could renegotiate at a lower rent. I believe you are joining us today with an update. Thats correct. Good morning, chair fewer and supervisors, i am the director of real estate. As you just stated. I was before you last week seeking positive recommendation on these leases. You asked that i go back and talk to the landlords because you were concerned that the rate that was proposed did not reflect an anticipated downturn if option in the market. I am pleased to announce we had those negotiations. The landlords are not very happy, but we were able to achieve a 15 reduction in the proposed rate for each of these leases due in large part to the willingness of the landlords to continue the partnership with the city. As it relates to 2119 and 2120 Mission Street, the current rate is 46. 75. The proposal before you last week was 48. 45 per square foot. The new proposed rate is 41. 18. I would note in this case, the new proposed rate is below the current rate and represents an almost 20 reduction. 2 gough street it is 39. 40 per square feet. New rate today is 44. 78. This concludes my presentation. I am available to answer any questions that you may have as well as robert walsh from hsa. Do you estimate the total cost savings is over the time of this rent, how much we are safing total . I do not have that figure in front of me. I believe in the resolution it gives the annual rate, but it doesnt give the annual savings. I would be happy to get that to you. That would be great. Any comments or questions or congratulations and our appreciation . Supervisor mandelman. I want to extend congratulations for taking this back to the lessor for willingness to have this conversation. It is a weird moment to enter a lease extension. That was correct last week and i think this is clearly an improved result to the city, allows the space to be used for important City Services and also recognizes the fact that there has been this economic downturn. These coffers will be strained Going Forward. Thank you. Seeing no other comments. Could we have Public Comment on items one or two, please. Operations is checking to see if there are any callers in the queue. If you have not done so press one and 0 to be added to the queue. Madam chair, no callers are wishing to speak. Public comment is closed. I just want to say thank you for negotiating on behalf of the citizens of San Francisco. I would like to mention as budget chair i would accept before we are looking for any extension of leases that there would be a conversation about reduction in rent so we know we are in economic downturns. Thank you so much. I appreciate it very, very much. I would like to make a motion. If supervisor peskin is listening, thank you very much. I would like to move to the full board with a positive recommendation. Could we please have a roll call vote. Thank you. Due to the new rates, i want to ask if the resolution is to be amended . Yes, could we have the City Attorney weigh in, please. Good morning, chair, members of the committee. I expect the resolution would require amendments to reflect new terms of the lease. I have not been sent amendments. To the extent be they would reduce the amount of the money the city is approving they wouldnt be substantive. As suggested by the clerk i would expect the resolution approving the leases would have revisions to reflect changed terms. Would we be able to vote today or have to wait for the amendments . Madam chair, we did provide red lines and clean versions of the amended resolutions to the clerk. If those are available and you want to continue this item to later in todays meeting, i think we would have a chance to look at them so the committee would vote today if they are available for review. Okay. Madam clerk, have you been able to find that legislation . Yes, madam chair. My apologies. We do have the amended legislation. I will forward it to the members of the Budget Committee now. We can take item 3 and come back. Would you please send a copy to the City Attorney. Lets go to item 3, madam clerk, please read. Resolution approving modification number 14 to airport contract for the San Francisco International Airport Terminal One Development program with t1 to increase by 6 million for a new not to exceed amount of 38 million for services and extending the term through july 7, 2023 to commence following board approval. Members who wish to comment on this item should call us at 8882045984. Press one and zero to line up to speak. Thank you. We have cathy wagner from the San Francisco International Airport. Good morning. Cathy wagner from the San Francisco International Airport. The item before you would approve modification to an existing project Management Support Services contract with t1 partners for the airports t1 program boarding area b project. The modification increases the contract by 6 million for a new total contract amount of 38 million and extending the contract through july 7, 2023. The original contract was the result of a 2013 competitive request for proposals and was approved by the board for the current 32 million not to exceed amount. T1 partners provides Program Management services to the terminal milk project including Program Planning and Program Costs and schedule controls, cord nation of Program Management with Construction Management and other program services. The original Contract Term was one year with nine one year options to extend. The airport previously exercised six of the nine oneyear extension options through july 2020 within the originally approved 32 Million Contract amount. This proposed modification would increase the final three one year options to extend. The second phase of the t1 program opened last week with nine gates in boarding area b as well as south side tickets lobby. While the airport has reevaluated Capital Improvement andy layed projects based on the covid19 crisis. The harvey milk project is a priority and will continue as scheduled. The airport has 1 billion of capital im provement Funding Authority and we have adjusted so this will blast for 18 months with the hope that it goes through a recovery period. The budget analyst has reviewed this modification and recommends approval. I would be happy to answer any questions you might have. Thank you. Could we hear from the bla, please. Good morning. Budget legislative Analyst Office. This approves the 14th amendment to the existing contract between the airport and t1 partners to provide Program Management services to harvey milk terminal renovation project. This would be approving the final three one year extensions of the contract. It was a 10 Year Contract to 2023 and increasing amount by 6 million from 32 million to 38 million. We summarize the 6 million increase in the contract on page 15 of our report. We also did have discussions with the airport about the cost of the contract, cost of the project and funding sources. There are some Revenue Bonds that would pay for the final part of this project which would cover the cost of the contract, also, as you look on page 16 of the report we do note there is cares act funding and passenger facility fee Funds Available to the airport to meet the revenue shortfall at the airport which is estimated at 200 million in the current fiscal year. Because the program is ongoing and this has been a performing contract that we do recommend approval of the resolution. Thank you very much. I see in the queue supervisor walton. Thank you. I have one question in terms of with the decrease in revenue for the airport, does this have any effect . Do we continue to monitor this . Just to clarify. Do you need to continue to monitor the capital plan or this contract specifically . Capital plan, this contract specifically, i know this wont be the last similar request we have. I am wondering with decrease in revenue how does that affect item three, and quite frankly Going Forward items that are going to be similar . This contract will be the final modification. This 6 million will closeout this contract for terminal 2 project. You will see some ongoing Capital Project items coming before you. As i said that entire project has been reevaluated with some projects delayed or removed so we can make our existing 1 billion authority in Capital Spending last for 18 months. I would be happy to get you some updated information on what projects we will be moving forward with andy laying if and what projects we will delay if that is helpful. Thank you very much. I will provide that to the committee. I have to say the airport did not reach out to us about this before. I didnt have an opportunity be to voice kernels. I am concerned about this contract. The airport is going to be in a slump more than 18 months. You have the buffer. We dont know how the economy l bounce back. We know if you need funds that most of the time happens that there are layoffs of workers. Actually, i think i would like to see that information before we actually have a vote on this. I would like to open this for comment and make a motion to continue this item into the next meeting of the budget and finance committee. Can you please call for Public Comment. Operation is checking to see if there are callers in the queue. Please let us know if there are callers ready please be added to the queue. Madam chair, no callers are wishing to speak. Thank you. Public comment is closed. Ms. Wagner, i would like to learn a little bit more about how the airport is going to meet the shortfall. I would extend a shortfall to even after 18 months. We are looking into the next two or three fiscal years to get an understanding, deeper understanding how you are going to meet these shortfalls because airports have been hit very hard and also the airline as. We dont know which airlines will recover financially. I dont have any idea on what your plans are. If you could provide some information to us that would be great. Supervisor mandelman. I want to make sure there is no client sensitivity acting on this rather than next week. No, that is fine. I would like to make a motion to continue this item to the next budget and finance committee and could i please have a roll call vote. On the motion supervisor walton. Aye. Supervisor mandelman. Aye. Supervisor fewer. Aye. Three ayes. Item four ordinance amending ordinance 17019 the annual salary ordinance fys 20192020 and 2020221 to add active military Service Related to the covid19 pandemic to the enumerated events that qualify for supplementary military pay. Supervisor stefani, i think you are the speaker today. Thank you. Good morning. Before you today is a minor amendment to the annual salary ordinance which i have put forth to make sure everyone who responds to covid19 is adequately compensated. The annual ordinance provides the city to pay employees on military leave the difference between the city salary and military pay. The city pays the retirement contribution while on leave and other benefits to about which they are entitle if it is over 30days. This only applies to terrorist attacks. These do not apply to unit training or similar events. My amendment expands to include members of the military called into active duty for covid19 response authorized by the federal government in march. This came to me after i heard from two individuals who are currently served in this capacity with diminished pay and benefits. They are doing the work, most vital in our country right now. I dont believe it is right they suffer additional Financial Hardship for doing so. As the budget and legislative analyst pointed out this will cost approximately 55,000 for employee deployed. San francisco has a very low number of individuals deployed. I have identified only two individuals in San Francisco. There may be others. We know only about 1,000 people actually meet this definition statewide which is only. 2 of one percent or two people per 100,000. This will have a tremendous impact on the lives of the individual families but small impact on the county. I want to thank those who drafted this so quickly. Thank you for your consideration. Members of the committee, supervisor stefani. In response to what is presented this would amend the annual salary ordinance for 19202021 for those called up for military pay. Based on information provided by the department of Human Resources we estimate the cost for individual 55,000. This is generally paid out of existing City Department budgets, not an additional budgeted cost to the city. The number is not known at this time how many San Francisco employees would be eligible, however, as supervisor stefani pointed out based on data from the state legislative analyst only about 1,000 individuals have been called upstate wide as of early april. We consider approval a policy matter for the board of supervisors. Any comments or questions . I am sorry. I am on by phone. Hi, supervisor yee. Do you have a question or comment . Yes. I know that in talking abou ther day when the numbers that San Francisco had that were deployed, i think they were saying 2018, 2019, somewhere around there were out of the whole year there were 23 deployed from San Francisco. I dont know what the number states on there, but right now they have deployed about 1,000. Is that the same ratio you are seeing for those whole year deployment in which a small number of San Francisco residents were involved . I think 23 or something. The two that supervisor stephanie seemed reasonable in terms of the sort of the ratio San Francisco versus california . That is a question. Is that a question for supervisor stefani, is that correct or the bla . Bla. Reasonable percentage. 1,000 deployed so far for the pandemic. Supervisor stefani said possibly two versus some concrete data we have for the Previous Fiscal Year in which 23 san franciscans were deployed. Yes, president yee through the chair. We did not have any kind of estimate on how many San Francisco employees would be called up and qualify. 123 that we put in the report was basically we requested information from the department of Human Resources over the past two years how many have been called up and calculated the average cost. That was 123 San Francisco employees over the past two years called up or receiving military pay in an average cost of 55,000. There is no number in terms of those who would be called up for covid19 response. What we did get is state legislative Analyst Office state wide about 1,000 were called up as of april 8th. We assume if 1,000 were ca