Need a theme song while we are waiting. There we go. We begin and each Small BusinessCommission Meeting that the office of Small Business is the only place to start new business in San Francisco and the best place to get information squl answers about doing business in San Francisco. The aufs of Small Business should be your first stop when you have a question about what to do next. We have a walk inophorous here at city hall, a phone number you can call and a website which is very useful, so make yourself available. This is the forum to voice concerns that effect the Economic Vitality of Small Business rkts policies projects or other things you think are concern to Small Business you are welcome to bring to the forum. Lets get started. Item 1, call to order and roll call. Commissioner adams, here. Commissioner dooley, here. Commissioner dwight, here. Commissioner ortiz is running late. Commissioner t [inaudible] mrs. President you have quorum. Item number 2. General Public Comment. Allows members to comment within the commissions purview. Any members have any comment on anything not on todays agenda . Seeing none Public Comment is closed itedm 3 is review and possibly action to amend the Small BusinessCommission Response to the board of supervisors file number 160065. Police code paid parental leave for bonding with new child. In your packet xhishzer dwight proposed adding a paragraph and qu provided two suggested options on where to place it and striking language that is similar to what is in the paragraph. First i like to read the paragraph. As you know we prepared a let toor the boferd supervisors based on disapuvl of the parental leave legislation as it is drafted. I think that got misconstrued as somehow being something that we were not spoteive of e78 ployee benefits in general and that is absolutely not the case so i want to take this opportunity to clear the record on that. What we object to is the way that this legislation is hustled through the process without ever considering our input and gibbing giving us time to make reasonable suggestions. We argued about the wrong thing we talk about changing this and that to a piece of legislation that is fundamentally flawed. My addendum to our letter is parental leave is a benefit that should be extend today all employees no matter what size company they work for and the cost thf benefit should be funded collect ivly and university by pay roll deductions or taxes not by the individual companies that hap chb to be effected. The legislation rushed through the approval prosin San Francisco excludes employees who work with fr the Smallest Companies and burden Small Business that employ many workers we are most trying to help. Had there been more time and effort spen on the detail we could have developed a benefit universally available to all employees and implementation acceptable to all businesses. I urge our State Government and more importantly or federal government to take the lead in making parental lead a universal benefit for employees funded by all employers. That is the end commissioners it is slightly different than what is in your packet so commissioner dwight it is . Y it is. I either got the wrong version when i modified the letter but commissioner dwight has red into the record his proposed amendment and in terms of the placement of it since it is very similar i just reread, it is the last sentence. Somewhat business urging the government to [inaudible] funding mechanism and make the benefits available. We can serve as a responsible role model. We are trying to set a example. I have no issue with and said that time and time again, San Francisco is a progressive city and sets bench pch marks for the state and fraul government. To that end this legislation is commendable. However, the problem with this legislation is that it undo law burdens certain businesses basically specifically businesses who have to provide the benefit whereas the parental leave benefit provided by the state is funded by all employees of the state and is given out universally to any employee and any company who needs it. Our legislation doesnt accomplish that and exclude employees for companies with 20 or less employees and it makes only companies effected pay for the benefit so it isnt collect ivly funded by employers or employee and it is exclusive to certain employees some of the ones we most want to help here. If any other modifications i want to go with what is in the record. Sorry i missed the last paragraph there. I think you read already a version of what we will be voting on maybe already into the record. Why dont we stick to that version . Whatever you want to do. It is the spirit of what we are trying to say here that we were criticized by some as not supportive of this, that is not at all the case and said that repeatedly and so if someone else would like to read it again that is fine with me, but i think you get what we trying to do here. So it is a action item if you want to accept it you can if not you can do that also just it would be great toi felt like it could go at the beginning or end of the letter so like to give the commission the deference to determine the placement. Commissioner dooley has a comment i want to echo what commissioner dwight said. I think really puts out there our feeling on this and we want to make that clear that we are obviously supportive of both employer and employee and i want to give a shout out to supervisor peskin who made a few amendments, they didnt go far enough and i think we need to be on the record urging that this go to its proper place, which is the state or federal government and not burden unnecessarilyit was just not a well thought out piece of legislation frankly the most pointiant to me is we argued about raising the limit for the number of employees and that is the wrong thing to argue about t. We should lower the limit. The real conversation for Small Business was wait a minute, how come i have to pay for this, it is a universal benefit and i may my own employees if i have older employees i dont pay anything. If i skewed towards the younger employee side of had scale and i have people want parental leave i pay disproportioninately and that burden falls on Small Businesses that average the cost among multiple locations as a out of state business or a formula Retail Business could and so even though companies will pay the same amount it effects the Small Business that is local, independently owns exclusively in San Francisco county. I think within our county boundaries and we invited teddy in today to have a conversation about that we should have had months ago about how to funds Something Like this so we can find something that is universally accept to business understanding we have to throw a little into the pot. Do we increase gross receipts tax or have a special assessment or tax . I dont know the answer but i know there is dialogue to be had rather than saying well make a kpigz and it will effect some business squz not others but that is okay because it isnt okay especially for a benefit that is shown to be funded in the country but every country where it exists is funding by employee dedeckzs accept in england where it is fundsed by the government but ges where the government gets the money . From taxes on citizens so in a rounds about way it isnt a pay roll deduction but income deduction. These things are general benefit squz they are collectively funded and here we have a situation that is not. I think if whee had time to get a sense about it we would have had a dialogue aroun that and not lets tweak this and push this around. We were pushing arounds the wrong bits. I appreciate the ofert thf chamber of commerce and boardf supervisors who tried to push thing around and make it feel better for certain constituents but that was the wrong approach and hopefully if we can make some substantial recommendations the supervisor s office can rething this or Mayors Office or have another piece of legislation. The good news is it didnt go to the ballot box so we dont have to deal with the voters just the board of supervisors. Well see if ted has recommendation frz us. At this point if there are no commissioner comments we can ask Public Comments. Any members of the public like to comment on this matter . Okay scott nob flaub just update what is going on with the state. The governor signed legislation that increased the amount from 55 to 60 percent and low income to 70 percent. Just a update that will impact the amount that employ ers pay. Moving in the right direction. We may vasupervisor become a state politician who can help push that further. Any other pub luck comment . Seeing none Public Comment is closed. Commissioner adams move to support your comment in the letter. Second. So, do take the motion to approvelets take motion to approve the comments. Roll call, commissioner adams . Yes. Commissioner dooley, yes. Commissioner dwight, yes. Commissioner toursarkissian, yes. Commissioner yee, riley, here. Commissioner zouzounis, yes. And then commissioners do and have a preference as to the placement in the letter at the beginning or the end . I move we place it in the beginning. I do too. Anyone second that . Moved by adams and seconded by commissioner zouzounis. Commissioner adams, yes, xhigezer dooley, yes. Dwight, yes. Commissioner toursarkissian, yes. Commissioner yee, riley, yes. Commissioner zouzounis, yes. That motion passes 60. Thank you. Thank you. So well make sure the clerk of the board resubmit the letter and it is in the official file with the legislation as it in is the your draft. So well move on now to item number 4, which is presentation and discussion on economic approaches to achieving social wlae responsible goals. This is a discussion item and we have ted eagan the city chief econnistmist of office of Economic Analysis toprint to you commissioners. Good afternoon commissioners. Ted eagan Controllers Office of Economic Analysis. Our office last month issued a economic impablth report on this item. Happy to take questions you have on that report. I also learned that youre interested exploring alternative funding with the legislation and happy to say a few words about that and answer any questions as well. Xhishzer dwight i think in his remarks highlighted points about this legislation that is different in terms of the funding model to how paid family leave is funded at the state level or other states. I think the two key differences are first, this legislation places the onus on additional funding the sup lltal compensation on the employer. The state program is entirely funded by employees, all employees whether they take paid family leave or not through their payroll tax or the state sdi program thmpt second isnt just who pays but how it is funded. It is funded essentiallythe tax creates a insurance pool and then when employees make a valid claim they draw from that pool. The budgeting challenge is insure the tax rate is set at a level such that the pool is big enough to fully fund the claims and that is a budgeting challenge but essentially what that allows is a program for like if that applied in the San Francisco case it would prevent a situation where for a very Small Business the supplemental cost could be particularly ownerous. One of the advantages of the way the legislation is structured now from the perspective of the Small Business if you have 2 or 3 employees you need to pay 50 percent thof cost missing and that can be a spike in the compensation during that period. The amount that is covered by the state basically has no burden for the business, it isnt paid for directly or indirectly by the business and it is also paid out of a insurance pool so neither the employees of the business nor emplorer pays. There are a couple decision to be made about this. The legislation makes this an employer responsibility and it makes it a employer by employer responsibility. There is alternative model that would say that it could be a employer responsibility but broadly based across the base of employers and employers pay into a insurance pool, that pool is drawn down by worker frz their 45 percent that is employer funded as well as when they make a valid claim to edd for the 55 percent that is employee funded. In that approach which basically combines the employer responsibility aspect the legislation in front of the board now along with the insurance pool model of the state legislation. There are any number of ways in which that could be funded. If you are talking about a dedicated pool though you are probably talking about one or other type of dedicated tax. A dedicated tax requires a 2 3 vote and the is administrative concerns as well about where does that money go and how is it managed, how do the rules related to a state claim line up with the rules for city claim and things like that. In a broad picture. An alternative funding mechanism could be a broader based business tax, additional business tax that is not currently charged that replace the individual employers responsibility for this. And potentially while this could be creative for paid family leave it could apply to other employee similar programs that the city has. Okay. As i sus spected st. Might be. Im interested, when we go about levying a new financial responsibility on businesses in the city, obviously if it were poseed as a tax it has to go to the voters. In some ways this feels like a end round because we said well make you pay and not call it a tax though. How is this being posed and under what circumstances can the board of supervisors unilaterally levy a fee on business versus take toog the voters in the form of a tax . Commissioner i avoid pretendsing to give legal advice on this. I think i would say the city isnt collecting money here. The city isnt levying a charge on business to be paid for the city for the city to do what it will. What i just laid out would be a situation which a tax is levied to businesses and come tooz the city and the city somehow runs a insurance pool. I understand that and i think that sounds reasonable. Basically what we are saying is we are mandating business do something but we are not passing it through the government so it isnt a tax, we are just telling them you have to do this, it is on your own, so it is a interesting mechanism which im only now just learning about. Okay. I have a question with the state model. Do you know what the percentage that is deducted from the employees, what type of thing they are paying . How much it is per pay check . I believe it is a pay roll tax and dont know the precise percentage that is specifically for or ear mark for pfl t. Is part of the sdi, state Disability Insurance deduction. A big piece is for Disability Insurance and small is for paid family leave and donts know the percentage of it total im not sure whether in california whether that is indexed to income so those who make more pay more. They do if it is linear but whether it is non linear. Certainly in the other countries that i briefly read about that is exactly the case. You make more you pay more so those who can afford pay more into the system so the idea is there is a notion of youif you on the low income end of the scale you dont pay as much but get the same benefit percentage wise as anyone else and get your full salary or some portion paid for. I assume that would require going to the ballot . Certainly any legislation that increases any taxpayer tax has to be approved by there voters and if the tax increase is dedicated to a specific purpose it needs 2 3 volt that is how it is at the state level and make a decision to increase the benefit by saying the pool as it exists is fine and we can handle that or raise the sdi tax and to cover that additional benefit. Likewise here, we might decide that as you pointed out this may be something we want to consider because maybe this isnt the only benefit and maybe there are other benefits we want to as a city set the bar for. What i am interested in is could we create institutional ize something that would be a shared responsibility of all companies and paid into by wealthier company more than companies that can afford less . Just seems like something to explore but thk you. Any other questions . Okay. Thank you, ted. Thank you any members the public like to comment . Seeing none Public Comment is closed. There is no action required, it is jooust purely informational. Any other comments very interesting. I want to thank you for bringing ted in and ted thank you for coming in and explaining this because this is another alternative wy may want the city tern at or attorney in next that was really helpful and like to convee more often like this in your office specifically maybe on the minimum wage questions moving forward and i know director [inaudible] and i were talking about what that may mean for automation as we see businesses prepare for that. Even in our city the cvs and bank of americans have automated teller squz that is something i would like to explore willing to work with the commissioners on items that are of interest of wru. We are not quite but all most to the point where we have enough data since the minimum wage increase said to look at Economic Impact so say 6 to 12 months from now we may see the beginning of the impact if any. Thank you a observation i have seen it is very important legislation Going Forward cont plate what happens if we what we do here is adopted by the state or federal government. For example, minimum wage is signed into law and go to 15 a hour, however we have no provision in our own law to true up with the state. We are just going about our process, we may at some point get to where we are even with