Transcripts For SFGTV BOS Special Budget And Finance Committee 20240712

I would like to thank sfgov for broadcasting this meeting. Madam clerk, do we have any announcements. Yes, this the board of supervisors and Committee Room is closed however members will be participating in the meeting remotely. This precaution is due to the state, federal, and local orders. Committee members will attend the meeting through Video Conference and participate in the extent as if theyre physically present. Public comment will be available on each item on this agenda. Channel 26 and sfgov. Org are streaming the number across the screen. Committee members have an opportunity to speak during Public Comment meeting, you can call 4156550001, meeting i. D. 1463207645. Press pound twice. When connected you will hear the meeting discussion and you will be muted and listening mode only. When your item of interest comes up, dial star 3 to be added to the speaker line. Best practices is to call from a quiet location and turn down your television or radio. Alternatively you can submit Public Comment in the following ways. Email myself at linda. Wong sfgov. Org. The email will be forwarded to the supervisors and will be part of the official file. Madam chair, this concludes my announcement. Thank you very much madam clerk. Can you call item 1. Yes, chart amendment, adjustment of baseline funding. It will not take in account certain changes in city revenue, resulting from voterapproved business taxes on the november 3, 2020, ballot. The municipal transportation fund, the park, recreation and open space fund, the children and youth fund, the Library Preservation fund, the Housing Trust fund, the Public Education enrichment fund, and dignity fund and street Tree Maintenance Fund at an election to be held on november 3, 2020. Increase the Small Business exemption for the gross receipt test to 1. 5 million and increase the annual Business Registration fee on businesses benefit from this increase, modify the gross receipt tax rate, repeal the payroll expense tax, increase the tax receipt tax for certain taxpayers for 15 years, and impose a general test on the gross receipts, and the commercial rent ordinance and make other changes to the citys business taxes. Item number 3. Ordinance to business and tax regulation code, motion ordering submitted to the voters in an ordinan ordinance amending the business and tax regulation code to modify the gross receipt tax rate, repeal the payroll expense tax, increase the gross receipt tax on certain taxpayers for ten years if a Court Strikes down the homelessness gross receipts tax ordinance, impose a new general tax on the gross receipts from the lease and certain commercial space for 10 years if a Court Strikes down the early care and education commercial rents tax ordinance. Identify number four, business and tax regulations code, business tax changes and item number five, Initiative Ordinance, business and tax regulation code, business tax changes. Meeting i. D. Is 1463207645 and press pound twice. Press star 3 to line up to speak. Please wait until the system indicates you have been unmuted and you may begin your comments. Thank you very much madam clerk. Colleagues, i want to provide a brief overview of how this meeting will go today. I will first be calling items 1 through 5 together as they are all related. Item 1 is the Charter Amendment that would exempt charter mandated set aside funds to taking into account certain changes in city revenue, resulting from voter approved backstop taxes that will be discussed in items 2 through 5. I will move to include this amendment in the business tax measure, rather than leaving it as a separate ballot measure. Items 2 through 5 are different versions of a proposal to change the business tax structure and accomplish a number of goals including providing relief to Small Businesses and industries impacted by covid19 by reducing their tax burden and helping them recover. Unlocking the hundreds of millions of dollars that the city has already collected from business taxes for child care and Homelessness Services but is unable to spend because of the ongoi ongoing litigation that was approved by voters in 2018. Completing San Francisco transition from a payroll tax that incentivizes local hirings to more progressive gross receipt tax where more higher earning businesses pay more. Items 2 and 4 were introduced by the mayor and items 3 and 5 was introduced by president yee, supervisor peskin, supervisor haney and myself . In a few minutes, ben rosen field will be presenting on the similarities and differences on this version. He will include an explanation of the amendment that i will be introducing for item 3 at president yees request. I will introduce these amendments once we had a chance to hear from the controller and members of the public, but first i would like to give president yee a chance to speak about this proposal in todays amendment. I also want to thank president yee and his staff for your leadership and your hard work to make this proposal as strong as it could possibly be. I want to extend a huge thank you to my colleagues, supervisor peskin and supervisor haney for making this happen and Ben Rosenfield for all his experience along the way. President yee, the floor is yours. Thank you chair fewer. Im going to thank you for your ongoing leadership as the chair of the Budget Committee. So, as chair fewer mentioned, i joined not only chair fewer but supervisor peskin and haney to bring forward a long overdue reform to our tax system by repealing the payroll tax and replacing it with the gross receipts system. This is the process that started in 2012 when our city leadership made a decision to move our citys business tax from a payroll system to this gross receipts system. The system was seen as a more equitab equitable, as more municipalities have adopted it. The voters saw the logic in this and passed the Reform Ballot Initiative then. However, the 2012 reform did not completely remove the city out of the payroll system and all parties at the time knew that we needed to address this at a future date. I will have to say that the future is now. We believe that this measure also needs to respond to the unprecedented economic crisis we are in with a fair equitable recovery program, especially for our Small Business community and our most vulnerable residents. This is why were calling this is the Small Business and economic recovery act. You must recognize that this Health Emergency only made existing inequities worse and the economic burden is not carried evenly. Who is hurting the most right now are families, small entrepreneurs and familyowned businesses. When we talk about recovery, it cannot be just for a field. You must start from the bottom up. We need to provide immediate relief to the hardest hit industries and businesses and also provide a responsible sustainable Funding Source for San Franciscos economic vitality. Our initial proposal we introduced weeks ago was a starting point. Today we are making a good proposal to a better proposal. Were offering amendments to strengthen the measure that reflects the numerous feedback that we heard throughout this process, particularly from labor, labor leaders, Small Businesses and community advocates. I want to provide a brief overview of what were proposing in amendments today and then allow our city controller to present further details. One major element to the measure is the ability to unlock funds already collected to the city, our city, our own initiative and also our early care and education for all. As you recall these two were passed by voters in 2018, but these voter backed initiatives are currently tied up in litigation. This measure will free up 300 million for the general funds by placing a stop tax that only goes into effect if we lose the court cases. We are extending this backstop tax to 20 years and well also incorporate the Charter Amendments to ensure that the revenue generates for this is not subject to baseline reductions. This will allow the refund of claims and support the general fund and freeing up the dollars intended for Housing Support and also for early care and education support. We are proposing to exempt more businesses from the tax by excluding Small Businesses making 2 million or less, not 200,000, but 2 million or less. This will benefit approximately 3,100 Small Businesses, many of which are barely getting by right now. Small businesses making less than 1 million. We will also see a reduction in the registration fees. We are proposing to provide significant tax reduction to more industries that are hardest hit by covid19 like hotel accommodations, Food Services, restaurants, and manufacturing. Over the course of the next few years. Lastly, it is clear that the economic the economy recovery is going to be prorated, protracted i mean. Therefore we are proposing that no tax increases are considered until january 2022. There will be a small phased incremental increase to the tax rate for Large Industries. Future step increases in 2023 and 2024 will be tied to economic recovery triggers. If the economy were not recovered yet. The tax Rate Modification will then be deferred to the following year. Our economy is entering what i call unchartered waters. We want to remain nimble and have the flexibility as a city to pause any increases by a reporting requirement so the controlling can provide recommendations to the board if taxes need to be further deferred or reduced due to Economic Conditions. Those are the amendments we are reviewing today and i want to emphasize that the board of supervisors maintain the power to defer or reduce taxes. We did this because recently we did this most recently with the vacancy tax. If Economic Conditions do not improve over the course of the next few years, the board can adjust the tax rates accordingly. You can also take a closer look at industry specific situations to provide a more tailored approach to rate changes. I truly believe that the updated measure is balanced, but brings immediate relief to those who need it the most, while offsetting the cost to many Large Industries that are less cost sensitive. I want to be clear that we will be making difficult budget decisions this year. There is no way to avoid that. With this measure, we can minimize the impact. We can prevent massive cuts to critical Public Services. Reinvest in jobs and Community Revitalization that is so desperately needed and to lift us all out of this devastating pantoja and pandemic and economic crisis. I dont want anyone to get the impression that this will solve all of our budget problems, but without it were going to be in a much worse place. That is something that none of us can afford. Colleague, i hope i can count on your support on this measure and before i hand it back to chair fewer, i want to appreciate the work of controller ben, ted, our chief economist, and our City Attorney team scott for their work and their creative collaboration. I again want to thank the other sponsors in this, for this measure. The supervisor peskin, fewer, and haney who worked with me on this Small Business recovery economic recovery act since the end of last year. I also want to thank their staff from peskins office, fewers office, haneys office, and my own staff. Are there any comments from the other sponsors before i turn it over to our city controller Ben Rosenfield . Supervisor peskin. Thank you president yee. You have taken all of the words of thanks out of my mouth, but i want to give you actually some words of thanks. This was a very, very complicated endeavor long before covid19 hit. We knew that it was going to be the project for 2020s ballot and we had to take some time off after the pandemic hit. You have really steered this across some really stormy unlikely seas and you done it with elegance. You kept your cool, which i have not. I just cannot thank you enough for the way you managed this and let me concur in my thanks and i will shout out my colleagues, and my staff. Thank you to the incredible staff that double checked everything and kept us on course and to budget chair fewer and supervisor haney, thank you. It was an Unlikely Group of four people, our measured president , our budget chair, and supervisors haney and myself. We brought this all together from different perspectives. To our controller and to ted eagan and the controls team. Thank you so much. To the tax team, way to move it incredibly fast as it changed and morphed in many ways. To people in labor, small busine business, as well as the chamber of commerce. I dont want to put words in the chamber of commerces mouths, but i think theyre coming around to the fact that president yee said, we have a fair and balanced package thats a long time in the coming. Thank you president yee for your extraordinary leadership. Thank you, i echo all of those accolades for you and your leadership. A few months ago, i understandably thought this was going to end and we didnt have the capacity to come together and make this happen, but because of your work and your leadership and your staff and chair fewer and supervisor peskin and the controller and the City Attorney staff, who have been working so hard on this, here we are. This is a really important measure generally for the future of San Francisco and its an essential measure for this moment, for right now. We need this to make investments in our critical and essential services to provide tax relief to Small Businesses and to create a structure that will ensure a strong economic recovery, which has to include investments and services and workers and you know, makes me hopeful for what well be able to do in the near future, not just with this revenue and structure, but as a team and as a board, working collaboratively. This is how it gets done. So thank you again and i know that the prop c, big c, little c, labor, on so days the chamber, were all also a part of providing input into this. I would just say as one of the four supervisors who was most closely connected to it and i shared this with the other supervisors, i really hope this is something we can support unanimously. This is a reflection of the best work that we all did on behalf of the rest of the board. It really should get the unanimous support of this board. Hopefully, ultimately of the mayor as well and of the voters of San Francisco. Thank you again for all your work on it. Its really extraordinary and lets get it done. Thank you chair fewer for your leadership and i know you know firsthand from these Budget Committee hearings that we really need this. You can imagine what it will look like in terms of investments and so many critical things without this measure passing. Thank you Budget Committee for your leadership. Chair fewer, did you want to add anything before we turn it over to ben . No president yee, but i like to give the opportunity for sophia to add questions or comments if she would like. Thank you chair fewer and president yee. I wanted to convey the mayors heart felt appreciation to the four of you for a collaborative process and im appreciative of these amendments today and in particular, as we can work our way through this economic recovery. She is reviewing those now and we do hope that we will be able to support this measure and we will be in touch. Thank you. Thank you very much. So president yee, absolutely. I think it is time to call the controller up. Do you agree . I agree. Great. So if we could have the controller, mr. Ben rosenfield. Good afternoon. [indiscernible low volume] i cant hear you. Thank you for having me here today, im Ben Rosenfield, the controller could you speak a little louder or closer . Is that better . Yes. Okay, thank you for having me here today president yee and chair fewer asked me to walk through the two measures that are here before you today by looking at places where theyre different and where theyre similar. Ill run through the different components of the tax. Its a complicated package that defines our second largest revenue in the city. [inaudible] to start with, the two taxes share a number of the same features, ill briefly highlight those and then run through each in more detail. Both measures fundamentally unlock the revenue that the city has been collecting for big and baby c. Since those taxes were adopted by the voters in 2018. It makes that revenue available despite litigation thats ongoing by creating a backstop tax that would go into effect, should the city lose that litigation and from which refunds could be paid. Secondly, both measures complete the retirement of the citys payroll tax and replace it with a revenue neutral increase to gross receipt rates, getting to a single tax system to the city, opposed to our current hybrid of both. Third, both measures provide permanent tax relief for Small Businesses and they provide temporary tax relief over the next several years for targeted industries. Both measures equalize rates for the information sector, effective in 2021, by moving them to the same rate schedule, the Financial Services, professional services, white collar industries. Both measures increase rates on certain sectors overtime. The timing and the level, and the breath of those increases vary. Ill talk through those. So to briefly describe and i think president yee already hit these major points. The measure that will be moved today, increase the Small Business exemption to 2 million. Secondly, the amendments today expand the interest industries that are subject to temporary tax relief in the boards measure, to include hospitality, food, services, arts, and recreation. With that expansion, the temporary tax relief closely proximates that which was originally proposed in the mayors measure. Third, reduce the level of the ultimate tax rate increase which was what was proposed two months ago. It phases those increases in over time. So rate increases in the initial version where a 30 level for Many Industries and would have gone into effect immediately in 2021. The changes here today reduce that ultimate increase to 15 to 20 percent, depending on the industry, and it phases those increases in not immediately, but beginning in 2024 and then taking steps forward in 2023 and 2024 as well. As president yee mentioned, there are measures added to the increases that delays the increases for a year if gross receipts in the city have not recovered. The amendment also extends the duration of the backstop from 10 to 20 years and as chair fewer mentioned, merges the charter baseline chain where the backstop tax into the measure. We have talked about the big and baby c backstop measure, but to recap it as you are all aware, many businesses in the city are paying big and baby c taxes. These are taxes on gross receipts for a larger company, commercial rent in the city, adopted by the voters of 2018. Were in the midst of litigation, challenging those taxes and as you know, my office has impounded funds were currently collecting should we have to pay refunds, should we lose. The measure before you create as backstop tax that solves that issue. The backstop tax which is informed very similar to the taxes established in baby c, but as a general tax would only go into effect if the Court Strikes down big and baby c. It would be replaced by a new tax. The information sector measures would be increased the rates paid by the information sector would be increased to match those paid by schedule 6. As both the president and chair fewer noted, the measure does provide additional tax relief for smaller businesses in the city. Registrations paid would be reduced. Additionally, the Small Business exemption, which is currently approximately 1 million with the increase. Under the mayors current proposal in front of you, the Small Business exemption is set at 5 billion, which would exempt other businesses from the tax. There is an exemption of an additional 3,100. Thats 20 of current taxpayers would be exempted. Both measures presented tax reli relief. The amendments to the boards version expand the universe sector to which the tax relief would be provided, and that would include manufacturing, retail, other services, hospitality, Food Services and restaurants, arts, entertainment, recreation centers. For those sectors, there would be a 50 reduction for adjusted rates on the first tax years of 2021 and 2022 and then a 25 reduction in 2023. With this change, the temporary tax reduction between you is largely similar, with the only exemption is the mayors version had economic triggers. The mayors initial proposal proposed Financial Services and Administrative Offices, those at the heart of the white collar businesses. There are significant amendments to the boards proposal today, the increase and the timing of it. In the amendments, a broader set of sectors would see increases of between 15 and 20 depending on the sector, down from a 30 increase in the initial proposal and rather than occurring in 2021, a month after the passage of the measures, these increases could now be delayed and then steppedup. So an initial step in 2022, 2023, and 2024. The last two step increases in 2023 and 2024 would be deferred by one year if the tax conditions are not met. I included the uplift and schedule by sector and appended to this report. Just to highlight some of the key revenue and spending impacts that result from the measure. The backstop tax feature in the short term would permit the city to spend 1. 5 billion over the next two years. This is comprised of 1. 2 billion that would be dedicated for Child Care Services and also the repayment of 300 million in funds to the general fund that had been advanced to those programs in the last several years. In the longer term beyond the budget period, the rate restructuring would generate ongoing revenue. There would be 20 million on full phasein, while the direct general fund would approximate 100 million. That 100 million ultimate increase does not capture the full value to the city, though, financially of the change, which would also include limiting losses in revenues from the tax base. We believe the shift will avoid the losses and obviously the spending benefits [indiscernible]. With that, i will stop and see if i can answer any questions. Colleagues, any comments or questions for the controller or for your colleagues, authors of this legislation . No comments or questions . Wow. Okay. Thats great. Supervisors, authors of this ordinance, do you have any other comments that you would like to add that perhaps mr. Rosenfield covered or you would like to go more in depth. I think mr. Rosenfield did a good job in explaining and i dont think we need to go into more details at least i dont think i do. I see supervisor walton in the queue. I want to thank you and all of my colleagues for all your hard work on this. The way everything was presented today, i know it seems like this was a simple process. I do want to thank you all for doing the hard work and being able to bring it to us in a package where everything is already set up and we have all the information that we need and appreciate your hard work. Thats great. I see supervisor mandelin in the queue. Thank you to everyone who got here. Its an important measure on our ballot and definitely needed. Thanks for your hard work. Wow, this is great. Were all in agreement. Madam clerk, lets open this up for Public Comment, items 1 to 5. Clerk yes, madam chair, i wanted to note there are six supervisors participating in this meeting. We are a special meeting of the board of supervisors. Operation, please let us know if there are any callers. Please press star three to go to the queue. Please let us know if there are any callers wanting to comment on items 1 through 5. Operator there are 10 callers in the queue. I will unmute the first caller. Im the organizer of [indiscernible] and i have children and am speaking to the proposal. We worked hard to collect signatures on the ballot [indiscernible] big businesses have captured most of the gains of the recent Economic Growth and it is time for them to pay their fair share. I was a stayathome mom before i started working and that was because of lack of child care. I you brought my daughter to work with me because my agency allowed me to do it. When i wasnt able to do that, the first payment was a shocker. It required all of my money so i had to find another option. A lot of families like mine need to work. With covid19 this is not possible. People are being asked to do more for less. We are being asked to keep doors open. The city invested in [indiscernible]. You can help us write now [indiscernible] i also anticipate that the mayor will support this because safety and the wellbeing of our children cannot wait. Thank you for your time. Clerk thank you for your comments. Next speaker, please. I am a member of [indiscernible] i live in San Francisco and i have two toddlers. Im here to talk about my experiences with child care. I appreciate all the support i heard with the fall. I struggled finding affordable, goodquality child care with my first child. The wait lists were long and i never got a call back. Then i got the surprise that i was pregnant again with my second child. So i started crunching numbers, but there was nowhere i could afford child care with two babies. To make things worse, i quit my job. My husband and i sold our home and we went to live with family to afford living. I found work to allow flexibility to work with my two kids, but when covid hit i wasnt able to do my job. I was no longer contributing to the economy or helping my family. Without child care, i couldnt go back to work. [indiscernible] its important that i keep the wellbeing of my children and my family. The first five years clerk thank you for your comments. Next speaker, please. We thank you for your expansion of the Small Business exception and an inclusion of industry sectors. These amendments are welcome and they help to reduce the negative fiscal impacts on already struggling businesses, but we are concerned about having major tax increases on the November Ballot and the making of a multiyear recession. There are more san franciscans out of work than the Great Recession of 2008. As we try to navigate the global pandemic, covid19, and the hundreds of thousands of global employees that continue to face layoffs, we must be sure we are building a stable economy. It is also imperative to note that San Franciscos economy is a big ecosystem. There will be shockwaves through our industries. We thank you for these amendments and thank you all for your time. Thank you so much. Clerk thank you for your comments. Next speaker, please. I am the director of Public Policy of the golden gait restaurant association. Were calling in to say we are very much appreciative of the work done to todays proposal. We remain concerned about the overall state of San Francisco and caution that now may not be the time to raise taxes on any business sectors. We are concerned to address the homelessness issues in San Francisco. Thank you for your time and we look forward to measures to support Small Business. Clerk thank you for your comments. Next speaker, please. I am considering child care an important need. I am chairing work for a friend of mine. In this time we need a lot of care for our children and i hope you will support us in approving these things. It sounds like the supervisors are really truly thinking about the community. I would like to thank you for your work. This is the manager of the Small Business commerce. I would like to thank you for the expansion of this for Small Businesses who have been impacted by covid19 as well as the expansion of the threshold to 2 million which includes a lot of highly vulnerable Small Businesses. While tax policy is rarely directed to injure Small Businesses, we all know that different policies can have both predictable and unforeseen circumstances for Small Businesses. Thats why its important to take care when weighing decisions even for Small Businesses. As everything is connected as an ecosystem in San Francisco, when the government has to tighten its belt and expenses rise, they have to tighten their spending, which we do need to remember can impact our Small Business community. Overall, i thank you for your consideration and narratives which are very encouraging for the support of Small Businesses in San Francisco. Im calling to say thank you for supervisors addressing this issue and taking this seriously. Child care is essential to the functioning of our society to allow our people to work and for the children to be in care with quality and education. As one speaker said before, those first five years are imperative to their future success. Thats what we do is offer that support for families and children and theyre desperate for that care and support right now. Im asking that you unlock the impounded gross receipts tax. We appreciate your support and we know you care what happens with this community with the characteristic and the community. We run a Business Incubator program to help more people become child care providers. [indiscernible] these women make minimum wage. Most of those dependant on the economy need child care. [indiscernible] expanding access to child care. There are 3,500 children on the San Francisco wait list. Ive heard that the funds will harm the Business Community and this is simply not true. Child care providers are the Business Owner owners. So support Small Businesses, we must release these funds. We thank the supervisors for bringing these items forward. I just wanted to voice my appreciation for the amendment made and in particular for those helps the retail and the arts and restaurant community. As a member of the local board, we continue to be concerned about the greater implications. The overall implications are very complex and we need to be super thoughtful before implementing any new taxes on San Francisco right now. Thank you for hearing my opinion. Clerk thank you for your comments. Next speaker, please. Hello. Thank you very much for having me [indiscernible] i want to be sure we are mindful. We are living in a time when bisss are being vilified for doing businessusinesses are bei for doing business here. My mother has been here for the last 32 years and shes someone who contributed for all these years. There is a feeling overwhelmingly that no matter what you do, youre punished for doing it, if you employ people, you feel a level of punishment. The same goes for if you have an ambition of buying an apartment or a home, you still feel that. Were in a time now of people fleeing the city and leaving the city. Im talking about people that are creating in a lot of ways the fabric of our city, the city block that we walk, the things that make San Francisco this amazing place to live. Im born and raised here, so i understand a lot of the needs of the people in my community. I do think a lot of these things are important. I would like the supervisors to think how businesses are treated in San Francisco. Clerk thank you for your comments. Next speaker, please. Good afternoon, supervisors. The Hotel Council has been devastated by covid19 pandemic and the orders that have surrounded that. We have come to a halt and our employees are not working. We appreciated the amendments in the meeting that would provide short and longterm relief for accommodations and hotels. However, many of the initiatives would hurt us at a time when were at our lowest being able to provide for our cities. Anything that would cause more taxes would be concerning. We appreciate the adjustments you made for our industry. Clerk thank you for your comments. Next speaker, please. Hello [indiscernible] im an essential worker. Ive been on the waiting list since my child was born four years ago. Im doing the best i can to support my family. Some days i have to take my daughter to work and other days i have to leave her with a family or friend. This is not the way parents should have child care. This is why i will continue to fight for all those currently and continuing to be on the waiting list. We need this funding and our lives depend on it [indiscernible] i was calling in and asking for support. After telling me story and explaining the high number of children on the waiting list and how crucial child care is, the city and we agree that child care is essential for the economic recovery. Our children are growing and they deserve access to child care that will provide a safe environment. We are asking you, please support this and help us now because child care is always essential. Thank you for taking the time to hear from the public. My name [indiscernible] all the hard work youve done to help streamline Small Business with regard to the payroll and clarifying that and making it more streamlined [indiscernible] we are cautious of raising taxes on other businesses. We need the businesses to stay in our city and we need the funding that these businesses and their employees provide. Make sure youre taking a nuanced look and we continue not to drive businesses, home owners, and businesses out of San Francisco. Thank you. Clerk thank you for your comments. Next speaker, please. I am calling in support of the executive tax because we need to support our frontline workers during the pandemic. I am the cousin of a Healthcare Worker and they have not been supported during this pandemic. We are afraid if we dont flatten the curve there will be a second wave. As a Family Member of a Healthcare Worker, i support the tax because greedy corporations because they greedy corporations need to pay their people more the overpaid executive tax can up to 140 million. We need to support our frontline workers during this pandemic. San francisco needs to be ready when the next wave hits. This is a vote in support of frontline workers. This shows that you value the working class san franciscans over corporate greed. Please support this tax. Thank you. I have been a resident of the bay area for 20 years. I work with Healthcare Workers every day and im asking you to prioritize the needs of when is during this pandemic. Big corporations are profiting while momandpop stores are shuttering. These companies will not leave San Francisco because they are being taxed a small percentage. We shouldnt stop this because were afraid they will leave. If they can pay executives Million Dollar salaries, they can pay their fair share. Cities around the country are preparing for a spike in the curve by stocking up on medical equipment and hiring First Responders and other Healthcare Workers. This is a vote in favor of Healthcare Workers. A vote in support of this tax shows that you support the hard work of everyday san franciscans over the corporate profits and their bottom line. Please support this overpaid executive tax. Thank you. I would like to remind people in the queue that we are hearing Public Comment on items 1 through 5. When you are speaking about the overpaid executive tax, that is items 6 and 7 and we are not taking Public Comment on that now. If you would like to comment on items 1 to 5, please stay in the queue, otherwise, please wait until we have introduced the item and Public Comment for items 6 and 7. We are now hearing Public Comment for items 1 through 5 only. Thank you. Im calling in because im a resident of San Francisco and a working mom. We are experiencing quite an upending of our lives during this pandemic. I wanted to say that i have been working and provided child care for a number of years and i have supported a number of organizations in the child care industry. I do wonder, however, if it is possible for the city of San Francisco to get its budget under control without increasing taxes. In the face of covid, many are fearful of a future economic downturn. Child care and Early Childhood education are absolutely important. It is important that during a downturn the city would like to squeeze us. Perhaps the supervisors could cut their salaries to cover these costs. Your proposal to tax your way out of this are essentially kicking all San Francisco working families while down. The most recent review of this demonstrates that San Francisco has a larger budget than larger cities. There is no reason for you to raise taxes, especially in an economic crisis instead of getting a handle on spending in San Francisco. Clerk thank you for your comments. Next speaker, please. Are there any other speakers . [indiscernible] im an essential worker and i am struggling because i dont have child care for my 4yearold son and i am [indiscernible] and also i want to make sure that child care is essential for the economy recovered. Its important that we get the funding [indiscernible] to spend more for child care. I support the proposition. Clerk i wanted to note that there are five callers in the queue. Thank you very much, board of supervisors and this particular committee for allowing us a chance to voice our thoughts on the action that you are about to take. Ive been a resident of San Francisco for over 20 years. I have worked in a restaurant for two years. I want to give a sense of understanding of what it is like to operate a Small Business in San Francisco. I applaud the reason for the action items that we are discussing now and the need to support child care and the other items. The pandemic has exposed that the goose that laid the golden egg is a valid metaphor for this. My heart and my wallet, frankly, has always supported those in need. The reality is the pandemic has exposed that to operate a Business Needs more than just a good heart. When we see Large Businesses leave San Francisco to put a gross receipt tax on the level that exists on these particular action items will be the wrong way to go. The reality is these businesses will not survive just because their taxes are less. They need to survive because there are customers. Clerk thank you for your comment. Next speaker, please. Madam chair, that completes the queue. Public comment is now closed. I want to thank my colleagues for reiterating this. This measure doesnt include taxes for Small Businesses, but tax relief for Small Businesses. We are very concerned about the support needed for Small Businesses. We support our Small Businesses. They are the life blood of our economy and city and they are struggling right now. All the services we put together for child care are things that our residents benefit and rely on, including our Small Businesses, Small Business owners and workers. Taking a huge hit in those things is only going to hurt our economy more broadly. I just wanted to reiterate that as im sure other supervisors would as well. Colleagues, would you like to add comments . Just a short comment. Thank you, supervisor, you hit the nail on the head there. We have used this initiative to help these businesses. If you look at it carefully, if you see the current tax that theyre paying, they would pay less in the future. There was acknowledgement of the fact by quite a few people that are worried about other issues. They understood that what we were trying to do was help the Small Businesses. Thank you. I hope the committee will make those amendments. After the amendments you have to come back to budget . Yes, it goes to a special budget and finance meeting of july 21. Thank you very much. Without further ado i also wanted to mention that our City Attorney is also that assisted us with this is available for comments. Colleagues, you should have a copy of the amendments. These amendments would expand tax relief to Small Businesses and impacted industries, specifically but exempting Small Businesses with gross receipts of 2 million or less and expanding tax relief to more entries affected by covid19 there would be a delay of tax increases to january 2022 with future increases in january 2023 and january 2024 based on economic recovery triggers. [indiscernible] finally establish reporting and look back analysis by including reporting from the controller and chief economist with treasurier to analyze the implementation of the measure called i have a rollcall vote, please. [ roll call ] [ roll call ]. Now i would like to make a motion to table items 1 and 2 and file items 4 and 5. Could i have a roll call vote, please. [ roll call ]. Can you please call items 6 and 7 together. [Initiative Ordinance business and tax regulations code tax on businesses with disproportionate executive pay] sponsors haney; ronen, walton, mar and preston motion ordering submitted to the voters an ordinance amending the business and tax regulations code to impose an additional gross receipts tax or an Administrative Office tax on businesses with a greater than 100 1 ratio of the compensation of the businesss highestpaid employee to the median compensation paid to the businesss employees based in the city; and increasing the citys appropriations limit by the amount collected under the additional tax for four years from november 3, 2020, at an election to be held on november 3, 2020. [hearing Initiative Ordinance business and tax regulations code tax on businesses with disproportionate executive pay] sponsors haney; ronen, walton, mar and preston hearing to consider the proposed Initiative Ordinance submitted by four or more supervisors to the voters for the november 3, 2020, election, entitled ordinance amending the business and tax regulations code to impose an additional gross receipts tax or an Administrative Office tax on businesses with a greater than 100 1 ratio of the compensation of the businesss highestpaid employee to the median compensation paid to the businesss employees based in the city; and increasing the citys appropriations limit by the amount collected under the additional tax for four years from november 3, 2020. We have supervisor matt haney as the speaker. Thank you so much, chair fewer, and to the committee members. Colleagues, today with my cosponsor cosponsors well have for your consideration the c. E. O. Tax. During this pandemic, americas billionaires saw their fortunes soar by 434 billion during the shelter in place. Jeff bezos and muck zuckerberg both had the biggest gains. Knees billionaire gains are billionaires becoming more billionaires. With this pandemic even as the economy and our Small Businesses grapple with the worst economic crisis in recent history, there is still tremendous wealth in our society and our city concentrated in the hands of the f few. Companies paying these out can see the cuts to essential services that we are facing as a city. Im looked at the department of Public Health and homelessness budget and the kind of cuts and what impact that would have on our city. Were just beginning that conversation of many hard choices. What we are proposing today is a simple and straightforward measure that can help us get through this crisis while also. If the measure passes any company that pays their toppaid employee 100 times more than their medium worker will have a 0. 1 surcharge added to their benefit. If the Top Executive makes 200 times more than the average employer, then its 0. 2 surcharge, 300 times, 0. 3 and so on capping at 0. 6. Our tax is modeled on a similar surcharge thats been implemented in portland, oregon, maine, washed, and nationally there are similar proposals to deal with rampant income inequality. This tax will raise up to 140 million every year which will allow the city to hire hundreds of nurses, doctors, Healthcare Workers. The Healthcare System is stretched and strained responding to emergencies, the already existing emergencies of Mental Health and addiction, but the very threatening and real pandemic that were facing as a city. This incentivizes companies to invest in their workers. Businesses can avoid paying the tax by paying their executives less or by raiding their employees wages. Companies that can afford tens of millions of dollars for salary sincere can afford to way their share in taxes. Executive daerls have risen by 900 . Big businesses all over San Francisco have the chance to be on the right side of history. This is a modest tax. Its going to go to the bestpossible use at time we need it more than ever. Its going to go to companies that are doing well and paying people a whole lot of money at a time we need a little bit more support. There are two amendments im proposing for the committee to adopt. The First Amendment adds the word managerial capturing the salary of the highestpaid executive in the company. The amendment appears on page 1, lines 6 and 17, page 2, line 25, and page 23, lines 15 through 16. Secondly, the Second Amendment caps the tax at 0. 6 instead of 1 , capping the tier at 0. 6 is a reasonable amendment adopting these amendments will not reduce the revenue range. The range will be 60 and 100 million. [indiscernible] these are the amendments im asking for the committee to adopt today. Im hoping you will support this measure. It is critical to help our economy address the needed investments. I want to thank our labor and Community Partners that have worked on this, our cosornss, and especially to the local Labor Council and all of the nurses, doctors, healthcare professionals, and front line workers for their support. I just want to clarify one thing because i know this comes up a lot. This is looking at total compensation which includes stocks and other types of compensation as it relates to the toppaid employee. That toppaid employee can be anywhere when looking at the medium salary, we are looking at that of those folks in. Thank you very much. Any comments or questions from my colleagues at all . Madam clerk, please open it up for comment. Clerk operator, can you check if there are any speakers. Can afford to pay executives millions a year can afford to pay their fair share in taxes to help us recover. The pandemic is over and cities are preparing for a spike and hiring nurses and First Responders and this measure not only raises much needed funds to fix the cracks in our health care it incentivizes companies to invest in their workers and not just executives. Business will not leave San Francisco because of this. Its not going happen. Its not true. San francisco is one of the most desirable cities in the United States for companies to be located in. A small surcharge can be avoided by investing in workers will have little to no impact on companies that can apay to pay their ceo millions of dollars. Businesses can avoid the tax by paying their executive less or simply raising employees wage. The executive tax only applies to companies who pays executives millions a year so please support supervisor haneys executive tax. Thank you for your comment. Caller hello. Im a resident of San Francisco. Im an active member of the Filipino Community Development Corporation and [indiscernible] program. I support the executive tax because i believe that big or Large Companies that can afford to pay executives billions of dollars can afford to pay their fair share to help us recover. The pandemic isnt over. Many are preparing for a spike in the curve and stocking up on medical equipment and hiring doctors and nurses and First Responders and other essential care workers. San francisco needs [indiscernible]. Executive salaries in the United States have skyrocketed by 40 but regular worker salaries have only grown by 11 . We [indiscernible] thank you and god bless. Thank you for your comment. Next speaker, please. Caller good afternoon supervisors im with the San Francisco chamber of commerce. On behalf of the chamber of commerce we appreciate the input and have seen the ceo tax and transfer tax did for the receive the same attention. We cannot have a oneoff tax we need to keep balancing the needs of where we are in the economy with the addition of new taxes. Taxes makes doing business in San Francisco difficulty. They have seen anchor businesses left and several businesses have allowed businesses to work remotely to leave to other cities and states. Further, while intended to affect Large Companies the pay doesnt exist for the larger companies. This tax will however, affect some of our more Medium Sized Companies in retail and hospitality. We have to be thoughtful of implementing more taxes during an employment crisis. Thank you for your comment. Next speaker, please. Caller hello. Im roxanna and im a registered nurse working in labor and delivery in San Francisco over 15 years and an active member of the california nurses association. I actually went to school in San Francisco all the way from prek to getting my b. S. N. And as a registered nurse i see how economic inequality impacts the health of our patients and our communities every day. San francisco is the most economically inequitable city in the country and that takes a toll on our collective health. I support taxing overpaid executives because we need this money to help support Front Line Health Care workers as we deal with the current pandemic and because San Francisco needs to be ready for the next wave. This measure raises muchneeded funds to help our health care and it also incentivizes companies to invest in their workers not just their executives. Although i can see where some companies would be hesitant, this measure would only make it so that the businesses start treating executives and employees fairly. Thank you for your time. Thank you for your comment. Next speaker, please. Caller hi, my name is deanna chan. A member of local 21 and resident of San Francisco many years and an occupational therapist for the city and county for the last nine years and have been deployed to the front line since april as an essential worker. I have been servicing the temporary housing shelter. I can tell you first hand the supplies are very low and reuse ppe as much as possible and we front line workers need help. As an essential front line worker i support the executive tax and we need the money as we deal with the pandemic head on. Its clear the pandemic is far from over and its time for all to help. As others have noted we believe Big Companies that can afford to pay executives billions every year can afford to pay their fair share in taxes to help the response. The tax only applies to companies who pay their executives millions a year. It will not affect Small Businesses. Please support supervisor haneys overpaid executive tax. Thank you from the front line. Thank you for your call. Next speaker, please. Caller im britly and ive been in district 6 all my life. Im calling to support the overpaid executive tax. I think its important we help our Health Care Workers especially due to the pandemic. They need our support in this small surcharge on massive businesses producing millions annually for a health care. I also like how it incentivizes money to raise employee wages if the businesses want to avoid the tax. Massive businesses like amazon and ceo jeff bezzos are benefiting and Health Care Workers are working to keep people alive. Thank you. Thank you for your comments. Next speaker, please. Good afternoon. My name is mr. William. Im an organizer for local 22 in San Francisco. We have Health Care Workers in california and 20,000 work in San Francisco. As a Health Care Worker representative we support the overpaid executive tax because we need to help the Health Care Workers with appropriate medical equipment during the pandemic and be able to hire more Health Care Workers. Its time those to help pay their fair share to help the San Francisco economy and to invest in San Francisco and the best way to do it is through this tax. We need the for instance board of supervisors take ownership and leadership and follow. The we are living in an a capitalist in crisis. They need do their part. We cant afford to cut 250 million to the department of Public Health in San Francisco. Please support the supervisors overpaid executive tax. Thank you. Next speaker, please. Caller hello, supervisors. Im [indiscernible] and im a member of San Franciscos [indiscernible]. I am calling today in support of the overpaid executive tax. Frankly we need the money. Were in a crisis and one thing is if a company can afford to pay millions to their executives and can certainly afford to pay their fair share to help us recover in this crisis. And from people who profit from this city and substantial resources they can help afford to pay their fair share to get us back on our feet. And we can see them avoid it by raising employee wages. Thats another option, right . Folks would be able to pay their own way. Right now cost of living so high in San Francisco and we know executives are overpaid. Maybe it will help incentivize them to behave in a new humane manner. Saying that, they can fair their fair share and make adjustments to help the rest of us and the city out. Their fair share and make adjustments to help the rest of us and the city out. Their fair share and make adjustments to help the rest of us and the city out. Their fair share and make adjustments to help the rest of us and the city out. Their fair share and make adjustments to help the rest of us and the city out. P their fair share and make adjustments to help the rest of us and the city out. A their fair share and make adjustments to help the rest of us and the city out. Y their fair share and make adjustments to help the rest of us and the city out. We have to do what we can to increase the revenue and id rather see revenue increases rather than budget cuts. We know it has a negative affect on improving the economy. It backfires. Bebest the best way to come out a crisis like this is increase spending not budget cuts to help the economy quicker. I encourage you to help support this machine measure and move it forward. Thank you. Thank you for your comments. Before we take the next speaker i want to note that there are 20 callers listening and 10 in the queue. Next speaker, please. Caller im Sarah Larsson a member of local 21. I work for the department of Public Health and were facing budget cuts and weve been under staff for a long time. Were going to need money from some place. It seems like for a long time huge corporations have gotten a lot of special deals in order to be here. Its time for them to give back. These executives can afford to pay and they should pay because theres no other city like San Francisco and i dont think that because a bunch of overpaid executives getting dinged for a little bit of money all corporations will move out. In fact im sure thats not going happen but this pandemic isnt over. We need to take decisive action. We need it now. This isnt on Small Businesses. This is for huge corporations and theres a lot of them here. Its very overwhelming when you consider the disparity and the haves and havenots and front of line workers will be called upon. Youre going to need us. Everybodys going to need us. Please help and vote for this. Thank you for your comments. Next speaker, please. Caller this is michael soto with the National Union of Health Care Workers calling in favor of this ordnance. It address the dual crises of the economic downturn and pandemic and make sure the city has the support it needs for front workers and First Responders. Many Big Companies such as those mentioned before are saving money by having workers telecommute and having offices and other facilities go unused and similarly in the Health Care Industry hmo and ppos are Bank Windfall because people are afraid to go to the doctor but theyre still collecting premiums. This is something we know big business can afford and cant afford economic inequality to increase and those with the most need to step up and help the most in this time of need. Thank you. Thank you for your comment. Next speaker, please. Caller hi, supervisors, thank you. Im John Mccormick i work in the tenderloin and wanted to call in support of this important legislation. Not cutting social services is unnecessary and thank you to the supervisors who are proposing taxes like this. Thank you so much. Thank you for your comment. Next speaker, please. Caller can you hear me . Yes, we can. Caller im Cynthia Gomes and im a research analyst. Im calling in support of the overpaid executive tax as some have commented and shared the need for resources is acute and will only continue to flow this measure raises funds and incentivizes companies to invest in workers and executive salaries in the United States over the last 30 years has skyrocketed by 940 and regular worker salaries have only grown 11 . Members of unions who work in the hotel and Hospitality Industry can tell you all too well whats that done to their standard of living. This something that say small surcharge. If Companies Choose to reinvest up their workers they can avoid the tax raising employees wages and its not a tax on Small Business businesses. We urge you to support it and thank you for your time. Thank you for your comments. Next speaker, please. Caller good afternoon im cheri chan. Im the union member for sba local 1316 and as we all know the provider essential worker for our county and community. So during the covid19 were trying our best to serve this community and take care of seniors. We love this city. We love San Francisco. However, the cost of living is extremely high. Today im asking supervisors and the mayor to stand on our side to help us to get more funding and our children and community. Downtown, i support the overpaid executive tax. Thank you, god bless you and stay safe. Thank you for your comments. Next speaker, please. Caller good afternoon. Im a San Francisco resident. Big companies can afford to pay executives millions of dollar salaries every year can afford to pay their fair share in taxes to help San Francisco recover. This measure not only helps raise funds and incentivizes companies to invest in their workers not just executives. San francisco is one of the most desirable cities for business and according to our record it has the highest density of billion airs of any city in the world thats why theres no truth businesses will leave San Francisco because of this small tax. This is not an attack on Small Businesses. It only applies to companies who pay their executives millions a year. Please support supervisor haneys overpaid executive tax. Its the right thing do. Our people need support from those who have more. Good afternoon supervisors. Thank you for taking time on this important matter today. I had conversations with some businesses and one of the businesses have recently said i wish my taxes we lower and i said to what level and he said maybe back to 198 6 then i pointed out he actually paid more taxes in 1986 than now in 2019. Its easy to avoid this tax. I think corporations have gotten too greedy. Theyve gotten so many breaks at the federal level and various state levels and not participating fully in everything they take out of the economy globally. We dont tend to look at the infrastructure when businesses come into town. They come into San Francisco with a full vetted infrastructure, water, electricity, all this stuff they dont invest in. They just take. And i think that its time for them to pay their fair share to get us through this pandemic. It is their moral responsibility and its getting a little old. I get it. Were doing things to help Small Businesses along. Theyre exempt from this tax. Large companies have a responsibility to help the communities theyre in and not just take out please, support this initiative. The Labor Council is 100 behind this initiative and thanks for your time, today. Thank you for your comment. Next speaker, please. Caller my name is teresa rutherfo rutherford. I with my coworkers and front line workers support supervisor haneys overpaid executive tax measure. This is a matter of equity and a matter of Corporate Responsibility because also its a matter that businesses use the resources of the communities they are existing in and built their resources off the backs of the community. Usually when they move into a community its already fully structured. Everything is there for them. The roads, the water, the Public Servants ready do their bidding. They come and enjoy and build off that. They dont bring anything in except to come and enjoy and benefit from the name and from the value of living in one of the most well known, well sought after cities like San Francisco. Business use resources of the responsibility have a responsibility to give back to the community otherwise all their doing is abufg abusing and taking advantage of the city and the people that do the work. They have a Corporate Responsibility. They have a social responsibility and it is equitable. Its shameful ceos make 940 on their salaries while front line workers who do the job, who deliver the services, front line workers in this pandemic who put their families on the line and their lives every day barely make 11 over 30 years. Right now in the city of San Francisco we are being asked as front line workers again to give up the little money we have, the little salaries we earn where the ceos are not being asked to do anything. So right now, the way to go and the way to do this and the way to bring equity and put your money where your mouth is is to hold the ceos accountable, is to have them give back to the communities they have lived off and benefitted off. I fully support the overpaid ceo tax measure and make it work and its not just about workers but about San Francisco and San Francisco thriving and it only thrives when some of the highest paid people benefiting in the world give their fair share and stop raping the community of its resources. Thank you. Thank you for your comments. Next speaker, please. Caller hello. Im a member of c. N. A. Im a delivery nurse at Kaiser Hospital for the last 40 years. During that time ive been the attending nurse between 5,000 and 6,000 babies. Thats my best estimate. I am in favor of this proposed tax. Its very specific and i dont see it will harm a huge number of people because there are not a ton of executives making more than 100 times than what theyre median worker is. What id like to mention is the fact that some will use possibly used to fix some of the cracks in the. Cracks in the. One of the cracks in the i can see though i dont like to speak abo about it because its embarrassing and sad and humiliating is i have an adult son im paying 800 a month to pay an insurance policy for him with kaiser. Right now my income has dropped 30 of the usual amount per month but i continued carrying this insurance policy for him because my son sadly is a drug addict. So my great fear is that should he need attention or decides to come out of his denial and get treatment, hell have nowhere to turn. So i think there are plenty of cracks in the cracks in the we can look at and share this money in a way that would help everyone. When you help the least of your brethren youre helping everyone. Thank you. Thank you for your comment. Next speaker, please. Caller i know a couple callers said this would not adversely affect Small Businesses but that is not the case. An impact on any part of our Business Community can shake our entire local economy. We have around 95,000 businesses here in San Francisco. A huge am of those are Small Businesses who rely deeply on our larger employers and the employees that come and patronize our vibrant and diverse Small Business community in San Francisco. Number one the impact i heard businesses talk about during covid19 might be the impact from losing the large employers and their employees in our city when theyve gone to work from home. You may think its your daily sandwich that supports the little shop down the way but theres a tight margin of payrolls and taxes and fee is the catering order from the company down the road. Ironically this is not going to be just the Top Companies who pay the tax. Theyre compensation ratios in San Francisco, as we all know, were the broad base of compensated tech employees which can leave and this will fact brick and Motor Companies who have already been drastically impacted by covid19. The number one Small Businesses need to provide are customers. We know who they are. Theyre the employees of large employers and the folks who have these good paying jobs to pay the high prices of San Francisco often created by the regulations we have here. We cannot continue to think San Francisco is so appealing that businesses will not leave. We already saw businesses start to recognize this negative cost benefit in San Francisco and begin to leave this last year. We are experiencing unprecedented unemployment in San Francisco and this is absolutely not the time to be implementing hasty oneoff and unprecedented taxes. Thank you for your time and consideration. Thank you for your comments. Next speaker, please. Caller hi. This is Rudy Gonzalez with San Francisco Labor Council. I want to thank the chair of the committee, supervisor fewer for her leadership and coauthors and cosponsors. I heard a fair amount of context. I think i would agree with the last person that commented from the chamber. I think a smart tax like the overpaid executive compensation tax actually will chip away at the inequality and the simple fact is minimum wage earner and company in San Francisco can have a ceo making upwards of 3 million and so they have a choice to make. They can help the taxes and attic inequality that draws on resources especially during a Public Health pandemic and raise the wages of workers and put money in the pockets of those workers that generate and stimulate the local company and help the same Small Businesses. The alternative is they could decide to keep their large executive compensation and contribute as an organization to the very services and City Infrastructure that they are going to need to successfully recover and that spans Public Health and infrastructure and all the various aspects of the city architecture. I think its a smart, progressive way to chip away at income inequality and smartly resourcing and focussing funds to desperately needed City Services to no surprise unfortunately with the city framework we have thousand of f. T. E. Vacancies that are plaguing short staffing and high degree of work for our current staff and we just take it as a given that these noble Public Workers will shift right into the service mode and [indiscernible] and all the critical needs we have as a community. If you support this tax thank you for your comment, sir. Next speaker, please. Caller madame chair, thats the queue. Thank you very much. Any more comments . Supervisor hanney. I want to thank all the callers who just expressed their opinions and mostly support. All the members of the community. I also want to shout out all of the essential workers and their representatives who called in. I think weve had a huge amount of support for this measure. Some essential workers, front line workers and Health Care Workers and Hotel Workers on the front line who are protecting us and saving lives and they know that even now we dont have enough services, enough staffing ratios, enough support for them. The idea that they would be asked to take a greater hit and they and their colleagues serve more people at longer hours as the same time we have dozens and dozens of billionaires in our city and have Companies Making tens of billions more even during this pandemic is unimaginable. This is not a hasty or onetime or oneoff, im not sure what that means. Its a permanent tax in that were going to pass it and the voters approve it it will be a permanent tax and a targeted tax only on companies who are able to pay their executives tens of millions of dollars. I guess everybody wants to hide behind Small Businesses. These are larger businesses doing very well and paying their executives over 100 times that of their need door median worker. Its a modest tax at a time when our city needs it more than of. When i talk to Small Businesses, what they say is they want to see us have effective and adequate City Services that address Mental Health, street cleaning, homelessness and it shunt shouldnt be on their backs. The services should be delivered and provided by those who can afford it and doing well and asking for a little bit more help from them to address the crises and the pandemic and not balance every budget and every cut on the backs of our heroes who are saving lives right now. We should have their back and should ask a little bit more from people doing very well. With that i hope you take the amendment and move this measure. Thank you very much. So Public Comment is closed on item 6 and 7. I think we have some amendments we should vote on so id like to vote to move those amendments. Can i have a roll call vote, please. Clerk yes. [roll call] id like to make a motion to move this as amended to be continued to the next regular budget meeting on wednesday july 22. Could i have a roll call vote, please. Clerk on that motion. [ro [roll call] you have three ayes. A motion to file item 7. Clerk on that motion. [roll call] you have three ayes. Thank you. Madame clerk please call item 8. Clerk the proposed initiative to the voters for the november 3, 2020 Salt Lake City entitled business and tax resolutions code stockbased compensation payroll expense paid at companies and publicly traded groups to increase the citys appropriations limit by the amount collected under the tax for four years from november 3, 2020. Members of the public who wish to provide Public Comment should call 1415665001. Metting id 146 320 7645. We have supervisor gordon mar or his legislative aide. The floor is yours. Thank you for hearing this. Im a legislative aide for supervisor mar. He not able to be here as is also serving [indiscernible] meeting today as well. The act has already been submitted to the ballot with the signatures of members of supervisors and is not subject to the vote in committee today and as a policy has been in discussion and consideration in various forms over a year now. Well try to keep this informational hearing brief today. We proposed the measure for a simple reason. We cannot balance our budget or close our multiyear deficit on the backs of city workers or on the backs of the vulnerable communities who rely on our programs and servic [technical difficulties] and the proposal was last year referred to as an i. P. O. Tax. To be clear its not a tax on i. P. O. S. Its a tax on compensation and most clearly understood and described as such. For the revenue estimate on the controllers file this would raise between 50 million and 150 million annually in new revenue for the city and county of San Francisco. It does this by restoring 2. 15 the tax rate public Companies Pay on stockbased compensation. This is similar to a Corporate Tax rate cuts in the sector. Stock base compensation is on the value of equity interest and stock, stock options, restricted stock, restricted stock units, stock as a result of Employee Stock purchase plans. Corporations that currently pay the tax and have stock based compensations as part of their expenses would face a tax increase on the stockbased compensation. Corporations paying the Administrative Office tax are also subject to this tax and the tax would only apply to Public Companies and i do want to note the measure has been written and could go into effect regardless of what else is on the ballot in november. Just to summit up, what we are taxing here is not new. Stock compensation is a form of payroll and already taxed and the rate were proposing is also not new. Its the same rate the companies paid a decade ago not only on stockbased compensation but all forms of payroll at that time. Were proposing to restore the rate for stockbased compensation and theres a federal tax break on stockbased compensation. Not only are the companies not paying a rate locally they use to it get a break federally. And with the proposal we believe and want to say that fiscal responsibility doesnt require us to be [indiscernible] it requires us to be creative in advancing Revenue Strategies to protect our budget in the long term and address the economic inequality and on fairness from homelessness to Housing Access to hunger. That means asking corporations most well off the most resilient to the current crises who too often have been given breaks in policy after policy to pay their fair share. Thats what the stock compensation tax does. Im happy to answer any questions but id like to thank supervisors roanin and peskin and [indiscernible] and others for their work in preparing this measure. Thank you. Thank you very much. Seeing no colleagues in the queue for questions or comments, lets open this up for Public Comment. Can we have Public Comment on item number 8. Operations is checking to see if theres any callers in the queue. Operations, kindly let us know if there are any callers that are ready. If youve not already done so press star 3 to be added to the queue. For those already on hold please continue the wait until the indicates you have been unmuted for your comments. Please let us know if theres callers wishing to comment. Madame chair, there are no callers in the queue. Public comment on item number 8 is now closed. If theres no comments and none in the queue, id like to make a motion to file this item. May i have a roll call, please. [roll call] there are three ayes. Is there any more business before us today . Clerk madame chair, we have no further business. We are adjourned. Thank you. It did take a village. I was really lucky when i was 14 years old to get an internship. The difference that it made for me is i had a job, but there were other people who didnt have a job, who, unfortunately, needed money. And they were shown to commit illegal acts to get money. That is what i want to prevent. [ ] today we are here to officially kick off the first class of opportunities for all. [applause]. Opportunities for all is a program that mayor breed launched in october of 2018. It really was a vision of mayor breed to get to all of the young people in San Francisco, but with an intention to focus on young people that have typically not being able to access opportunities such as internships or workbased learning opportunities. Money should never be a barrier to your ability to succeed in life and that is what this program is about. Theres always these conversations about young people not being prepared and not having experience for work and if they dont get an opportunity to work, then they cannot gain the experience that they need. This is really about investing in the future talent pool and getting them the experience that they need. It is good for everyone because down the road we will need future mechanics, future pilots, future bankers, future whatever they may be in any industry. This is the pipe on we need to work with. We need to start developing talent, getting people excited about careers, opening up those pathways and frankly giving opportunities out there that would normally not be presented. [ ] the way that it is organized is there are different points of entry and different ways of engagement for the young person and potential employers. Young people can work in cohorts or in groups and thats really for people that have maybe never had job experience or who are still trying to figure out what they want to do and they can explore. And in the same way, it is open for employers to say, you know what, i dont think we are ready to host an intern yearround are all summer, but that they can open up their doors and do site visits or tours or panels or conversations. And then it runs all the way up to the opportunity for young people to have longterm employment, and work on a project and be part of the employee base. Something new, to get new experience and meet people and then you are getting paid for it you are getting paid for doing that. It is really cool. I starting next week, i will be a freshman. [cheers and applause] two of the things i appreciate about this program was the amazing mentorship in the job experience that i had. I am grateful for this opportunity. Thank you. Something i learned at airbnb is how to network and how important it is to network because it is not only what you know, but also who you know to get far in life. During this program, i learned basic coding languages, had a had to identify the main components and how to network on a corporate level. It is also helping me accumulate my skills all be going towards my College Tuition where i will pursue a major in computer science. For myself, being that i am an actual residential realtor, it was great. If anybody wants to buy a house, let me know. Whenever. [applause] it is good. I got you. It was really cool to see the commercial side and think about the process of developing property and Different Things that i can explore. Opportunities for all was a great opportunity for all. We were aiming to have 1,000 young people register and we had over 2,000 people register and we were able to place about between 50 and did. We are still getting the final numbers of that. Over several weeks, we were able to have students participate in Investment Banking they were able to work with our team, or technology team, our engineering 20 we also gave them lessons around the industry, around financial literacy. There are 32,000 young people ages 16 and 24 living in San Francisco. And imagine if we can create an opera skin it just opportunity for all program for every young person that lives in public housing, affordable housing, low income communities. It is all up to you to make that happen. We have had really great response from employers and they have been talking about it with other employers, so we have had a lot of interest for next year to have people sign on. We are starting to figure out how to stay connected to those young people and to get prepared to make sure we can get all 2400 or so that registered. We want to give them placement and what it looks like if they get more. Lets be honest, there is always a shortage of good talent in any industry, and so this is a real great career path. For potential sponsors who might be interested in supporting opportunities for all , there is an opportunity to make a difference in our city. This is a really thriving, booming economy, but not for everyone. This is a way to make sure that everyone gets to benefit from the great place that San Francisco is and that we are building pathways for folks to be able to stay here and that they feel like they will belong. Just do it. Sign up for it. [ ] [ ] clapping. the airport it where i know to mind visions of traffic romance and excitement and gourmet can you limousine were at San Francisco inspirational airport to discover the awardwinning concession that conspiracies us around the world. Sfo serves are more 40 million travelers a year and a lot of the them are hungry theres many restaurant and nearly all are restaurant and cafe thats right even the airport is a diane designation. So tell me a little bit the food program at sfo and what makes this so special well, we have a we have food and Beverage Program at sfo we trivia important the sustainable organic produce and our objective to be a nonterminal and bring in the best food of San Francisco for our passengers. I like this its is inaudible i thank my parents for bringing me here. This the definitely better than the la airport one thousand times better than. I have a double knees burger with bacon. I realize im on a diet but im hoping this will be good. It total is San Francisco experience because theres so many people and nationalities in this town to come to the airport especially everyone what have what they wanted. Are repioneering or is this a model. Were definitely pioneers and in airport commemoration at least nationally if not intvrl we have many folks asking our our process and how we select our great operators. The food option in San Francisco airport are phenomenal thats if it a lot of the airports yeah. You dont have the choice. Some airports are all about food this is not many and this particular airport are amazing especially at the tirnl indicating and corey is my favorite i come one or two hours before my flight this is the life. We definitely try to use as many local grirnts as we can we use the goat cheese and we also use local vendors we use greenly produce they summarize the local soured products and the last one had 97 percent open that. Wow. Have you taken up anything unique or odd here. Ive picked up a few things in napa valley i love checking chocolates theres a lot of types of chocolate and caramel corn. Now this is a given right there. Im curious about the customer externals and how people are richmond to this collection of cities youve put together not only of San Francisco food in San Francisco but food across the bay area. This type of market with the local savors the highend products is great. I know people cant believe theyre in an airport i really joy people picking up things for their friends and family and wait i dont have to be shopping now we want people take the opportunity at our location. How long has this been operating in San Francisco and the late 18 hours it is one of the best places to get it coffee. We have intrrnl consumers that know of this original outlet here and come here for the coffee. So lets talk sandwiches. Uhhuh. Can you tell me how you came about naming our sandwiches from the katrero hills or 27 years i thought okay neighborhood and how do you keep it fresh you can answer that mia anyway you want. Our broadened is were going not irving preserves or packaged goods we take the time to incubate our jogger art if scratch people appreciate our work here. So you feel like out of captured the airport atmosphere. This is its own the city the Airline Crews and the bag handlers and the frequent travels travelers and weve established relationships it feels good. When i get lunch or come to eat the food i feel like im not city. I was kind of under the assumption you want to be done with our gifts you are down one time not true we have a lot of regulars we didnt think wed find that here at the airport. People come in at least one a week for that the food and service and the atmosphere. The food is great in San Francisco its a coffee and i took an e calorie home every couple of weeks. Im impressed i might come here on my own without a trip, you know, we have kids we could get a babysitter and have diner at the airport. This is a little bit of things for everybody theres plenty of restaurant to grab something and go otherwise in you want to sit you can enjoy the experience of local food. Tell me about the future food. Were hoping to bring newer concepts out in San Francisco and what our passengers want. I look forward to see what your cooking up laughter today weve shown you the only restaurant in San Francisco from the comfortableing old stand but you dont have to be hungry sfo has changed what it is like to eat another an airport check out our oblige at tumbler dating. Com roughly five years, i was working as a high school teacher, and i decided to take my students on a surfing field trip. The light bulb went off in my head, and i realized i could do much more for my students taking them surfing than i could as their classroom teacher, and that is when the idea for the city surf project was born. Working with kids in the ocean that arent familiar with this space is really special because youre dealing with a lot of fear and apprehension but at the same time, a lot of excitement. When i first did it, i was, like, really scared, but then, i did it again, and i liked it. Well get a group of kids who have just never been to the beach, are terrified of the idea, who dont like the beach. Its too cold out, and its those kid that are impossible to get back out of the water at the end of the day. Over the last few years, i think weve had at least 40 of our students participate in the city surf project. Surfing helped me with, like, how to swim. Weve start off with about two to four sessions in the pool before actually going out and surfing. Swimming at the pool just helps us with, like, being, like, comfortable in the water and being calm and not being all not being anxious. So when we started the city surf project, one of the things we did was to say hey, this is the way to earn your p. E. Credits. Just getting kids to go try it was one of our initial challenges for the first year or two. But now that weve been doing it three or four years, we have a group of kids thats consistent, and the word has spread, that its super fun, that you learn about the ocean. Starting in the morning, you know, i get the vehicles ready, and then, i get all the gear together, and then, i drive and go get the kids, and we take them to a local beach. We usually go to linda mar, and then occasionally ocean beach. We once did a special trip. We were in capitola last year, and it was really fun. We get in a circle and group stretch, and we talk about specific safety for the day, and then, we go down to the water. Once we go to the beach, i dont want to go home. I cant change my circumstances at home, but i can change the way i approach them. Our program has definitely been a way for our students to find community and build friends. I dont really talk to friends, so i guess when i started doing city surf, i started to, like, get to know people more than i did before, and people that i didnt think id like, like, ended up being my best friends. Its a group sport the way we do it, and with, like, close camaraderie, but everybodys doing it for themselves. Its great, surfing around, finding new people and making new friendships with people throughout surfing. It can be highly developmental for students to have this time where they can learn a lot about themselves while negotiating the waves. I feel significantly, like, calmer. It definitely helps if im, like, feeling really stressed or, like, feeling really anxious about surfing, and i go surfing, and then, i just feel, like, im going to be okay. It gives them resiliency skills and helps them build selfconfidence. And with that, they can use that in other parts of their lives. I went to bring amy family o the beach and tell them what i did. I saw kids open up in the ocean, and i got to see them connect with other students, and i got to see them fail, you know, and get up and get back on the board and experience success, and really enjoy themselves and make a connection to nature at the same time. For some kids that are, like, resistant to, like, being in a Mentorship Program like this, its they want to surf, and then later, theyll find out that theyve, like, made this community connection. I think they provided level playing fields for kids to be themselves in an open environment. For kids to feel like i can go for it and take a chance that i might not have been willing to do on my own is really special. We go on 150 surf outings a year. Thats yearround programming. Weve seen a tremendous amount of youth face their fears through surfing, and that has translated to growth in other facets of their lives. I just think the biggest thing is, like, that they feel like that they have something that is really cool, that theyre engaged in, and that we, like, care about them and how theyre doing, like, in general. What i like best is they really care about me, like, im not alone, and i have a group of people that i can go to, and, also, surfing is fun. Were creating surfers, and were changing the face of surfing. The feeling is definitely akin to being on a roller coaster. Its definitely faster than i think you expect it to be, but its definitely fun. It leaves you feeling really, really positive about what that kids going to go out and do. I think its really magical almost. At least it was for me. It was really exciting when i caught my first wave. I felt like i was, like it was, like, magical, really. When they catch that first wave, and their first lights up, you know their face lights up, you know you have them hooked. I was on top of the world. Its amazing. I felt like i was on top of the world even though i was probably going two miles an hour. It was, like, the scariest thing id ever done, and i think it was when i got hooked on surfing after hi. My name is carmen chiu, San Franciscos elected assessor. Buying your first home is a big deal. For many of us, its the single largest asset that well own. Thats why its really important to plan ahead for property taxes so that there are no surprises. A typical question new homeowners ask is what is a supplemental tax. So understand supplemental tax, we need to start with proposition 13. Under californias prop 13 law, the value we use to calculate your property tax is limited to a 2 growth peryear, but when ownership changes, prop 13 requires that we set a properties assessed value to market value. The difference in value between the previous owners value and the new value is the supplemental assessment. How does the supplemental assessment translate to the tax you need to pay . Supplemental tax is calculated by applying the tax rate to the value and then prorating it for the amount of time that you owned it in that tax year. In generale, the tax rate is roughly 1 . Lets walkthrough an example together. Here dan is the original owner of a home with a prop 13 protected value of 400,000. With a tax rate of 1 , he pays 4,000. Dan sells his home to jennie at a market rate of 700,000. In this case, jennies home will be reassessed to 700,000, and jennie is responsible for paying property taxes at that level from the time she first owns it. Many times, people might have already paid their property taxes in full by the time they sell their home. In that case, dan has paid 4,000 in taxes already for the full year. Jennie would likely payback dan through escrow for her share of the 4,000, depending on the proportion of the tax year she owns the home. However, shes also responsible for paying taxes at the higher market value from when she begins to own the home. How does that work . Lets say jennie owns the property for nine months of the first tax year, which is approximately 75 of the year. During the escrow process, shed pay dan back 75 of the 4,000 he already paid, which is 3,000. On top of that, she would owe taxes at the higher rate for the proportion of the year she owned the house. In this case, she owes the amount not already billed through dan or 700,000 minus 400,000, multiplied by a tax rate of 1 , and multiplied again by 75 to reflect the time she owned the home in that tax year. Here, jennies supplemental tax is roughly 2,250. Going forward, jennie will be billed at her new reset prop 13 value. Are you still with us . If this isnt complicated enough, some new owners might receive two supplemental tax bills, and this has to do with the date that you transfer property. But before we get to that, you first need to understand two concepts. First, what is a fiscal year . In california, local government runs on a fiscal year. Unlike the calendar year, where the year begins on january 1, a fiscal year begins in the middle of the year, on july 1. Property tax follows the fiscal year cycle. Second, state law requires property be valued as of january 1 every year, in other words, new years day. The value as of january 1 is used to calculate property taxes for the upcoming fiscal year. This means Property Value as of january 1, 2018 will be usedtor fiscal year 18 used for fiscal year 1819 covering july 2018 through june 2019. Similarly, the value of january 1, 2019 will be used for the fiscal year covering july 2019 through june 2020. Now back to whether you should expect to receive one or two supplemental tax bills. The rule of thumb is that if the property transfers happens in the first half of the fiscal year, in other words between july and december, then you should expect only one supplemental tax fill. If the transfer happens in the second half of the fiscal year or between january and june, you should expect two supplemental tax bills. Heres the reason why. Using dan and jennies example again, dans 400,000 value as of january 1 is used to set the tax bill for the following fiscal year beginning july through june of the next year. Jennie buys the property from dan in october. The taxable value is reset to 700,000 as of october, but the bill issued still reflects dans lower value. In this case, jennie would expect to receive one supplemental or catchup bill to capture the difference between her assessed value and begans fr begans dans from october through june. Because of january 1 we already know of the sale, we would have used the following year to set jennies property taxes and no other supplemental bill should be received. However, if dan sells the property to jennie in march, instead, jennie should expect two supplemental bills. Like before, jennie would receive one supplemental bill to cover the time in which she owned the home in the current tax year from march to june. But because as of the next january used to set the tax base for the following tax year, dan still owned the home, the following years entire bill still reflects the values not updated for jennie. In this instance, jennie receives a second supplemental for the following year covering july through june. After the supplemental tax bills, new owners should receive only one regular tax bill peryear going forward. Remember our office values the properties, but billing and collections are handled by another Organization Called the treasurer and tax collectors office. If youd like to learn more, please visit our website at sfassessor. Org. Thank you for watching. Watchi. Youre watching coping with covid19 with chris manners. Todays special guest is julie kirschbaum. Hi. Im chris manners. Youre watching coping with covid19. Today, im speaking with the executive director of the sfmta. Thank you and welcome to the show. Thank you for having me. Can we begin by talking about the services that have been suspended and there have been changes to the services that are still running . Absolutely. Weve had to make really significant changes to our services in response to covid19. Initially going down to as few as 17 routes. These are routes that people use to get to work or the hospital, Grocery Stores, really to make the most essential trips that are needed throughout this process. Weve been fortunate over the last, say, five or six weeks, that our Staffing Levels have gotten better, and as weve increased our cleaning capacity, that weve been able to add some Community Services back. Weve added a shuttle on pacific avenue, which is helping seniors get to Grocery Stores in chinatown. Weve added a community inline bus in ingleside, and weve been adding more service to our core network. Our corridors like mission street, potrero near s. F. General, and really needing increasingly more and more service in order to prevent spacing and keep spacing and prevent crowding on the bus. Thank you. What measures have you been taking to prevent passengers on the bus . Your safety has been our top priority and is guiding everything that we do. The most critical thing that were doing is the mask requirement, where were requiring people, if youre going to ride muni, to do it safely, protecting yourself and others from germs. Weve also implemented back door boarding, so except for our customers with disabilities that will need the support of the front door, the ramp, or the leader, were asking customers to enter from the back to give extra spacing to our operators. Weve provided operators with all of the protective equipment that they need to do the job safely, including gloves and masks, and were really fortunately that our bus fortunate that our buses are equipped with a plexi glass door that creates an operating space for our operators. And some of Services Like the cable car historic trolleys we dont have that same protection, we suspended early on in this process. We want our operators to have the physical separation that they need to stay safe on the road. Absolutely. So how have you been managing physical distancing on Public Transportation . What happens if a bus gets full . Great question. We have reduced the number of people that we consider a bus to be crowded, so heading into this, we might have had 70 or 80 people on the bus. Now, its closer to 20. We also are monitoring our passenger loads. Both our operators are monitoring them as well as were monitoring them remotely from our Transportation Management center. If the bus does get too crowded, the operators have a dropoff only sign, and they stop picking passengers up until enough exit the vehicle. It might be a little bit inconvenient if youre waiting for a bus and it doesnt stop to pick you up, but theres another one coming behind it so we can make sure that you have social distancing throughout this process. What other ways have you been letting passengers and residents know about these changes and new policies . Weve been using all methods to keep customers informed about all of these changes. Weve put up almost 2,000 signs and posters at our bus stops in multiple languages, letting people know when routes have been eliminated, when hours have changed, when service has changed. Weve also been putting it up through social media and neighborhood groups, and also really relying on the media and press to notify customers about changing. We want the public to know what to expect in this really unique and unusual time to make things as convenient as possible. Quite right, yes. Other than the operators themselves, i know you have a very large support staff. Have you made changes at your muni facilities, as well. Sfmta has 29 facilities, and enhancing safety at those facilities has really been a team effort. We have an amazing custodial crew thats been doing deep cleanings. We were able to take staff that had been cleaning the subway stations and dedicate them to our facilities. We have also seen staff at every level jump in and help with daily cleanings in places like common areas, desks, tools. Everyone is pitching in to wipe stuff down, which makes a big difference. We are proud of the fact that we havent had any clusters of staff who have had the virus or really any examples of staff catching it from each other, and we feel its because of the steps that were taking to keep people safe at work. Were also taking ideas from everywhere in the organization. That includes safety briefings, rather than doing them in a small room, doing them outside, in a parking lot. In order to get to job sites, staff had previously taken three or four people in a city truck. Now, were taking them in a bus so they can actually space out during the trip to the site. Oh, thats great stuff. When we look at the Transportation System as a whole, what additional steps have been taken to encourage people to consider alternative forms of transit. We have been looking at it as a system in part because the bus system is doing less than it has in the past because we have fewer routes and because we have fewer people riding. One example is our e. T. C. Program, which is a taxibased program that seniors and people with disabilities can sign up for and use a taxi for essential trips at a highly discounted rate. Were also looking at a Transit System that people can get out walking or biking. How are we planning on next steps as restrictions ease and we move into phase two and eventually phases three and four . I think probably our biggest thing that were getting ready for right now is the start of school in august, and make sure that were ready, not only to accommodate all of the general activities, like going to restaurants and recreation, but also getting kids to school safely. Were also looking at what are other cities doing around the world that we can learn from, and thats where we are forming our work, as well. We are really fortunate that we had an opportunity to skype with taipei, a city thats had a lot of success addressing the virus. The mayor actually joined the skype call, and one of the things that they shared with us, their biggest success has come with 100 compliance masks on mass transit. In other cases, monitoring for temperatures and really making sure that people were riding, that they were riding healthy, so were trying to model and apply those best practices to our system and learn as much as we can through this process. Well, thats fantastic information. I really appreciate you coming on the show, miss kirschbaum. Thank you for the time youve given us today. Thank you. Thanks again. Well, thats it for this episode. Well be back with more covid19 relates information shortly. Youve been watching coping with covid19. Im chris manners. Thanks for watching. My name is naomi kelly the singlestory for the 775 i started with the city and county in 1996 working for the newly elected mayor willie brown, jr. Not only the chief of staff a woman but many policy advisors that were advising him everyday their supportive and nourished and sponsored United States and excited about the future. My name is is jack listen and the executive director of a Phil Randolph institution our goal to have two pathways to sustaining a family here in San Francisco and your union jobs are stroen to do that i have this huge way to work with the Community Members and i think i found my calling i started in 1996 working for willie brown, jr. I worked in hes Mayors Office of housing in the western edition and left 3 years went to law school of San Francisco State University and mayor brown asked me to be the director of the Taxicab Commission and through the process i very much card by the contracting process and asked me townhouse the city purchaser and worked with me and i became the deputy administrator and. Having trouble struggling to make ends meet folks will not understand what importance of voting is so we decided to develop our Workforce Development services after a couple of years offering pathways to sustainable jobs. clapping. weve gotten to a place to have the folks come back and have the discussion even if participation and makes sense we do Public Services but we also really build Strong Communities when i started this job my sons were 2 and 5 now 9 and 6 i think so the need to be able to take a call from the principal of school i think that brings a whole new appreciation to being understanding of the work life balance. clapping. i have a very good team around me were leader in the country when it comes to paid and retail and furiously the affordablecare act passed by 3079 we were did leaders for the healthcare and were in support of of the women and support. In my industry i feel that is male dominated a huge struggle to get my foot in the door and i feel as though that definitely needs to change this year needs to be more opportunities for i dont know women to do what tell me dream i feel that is important for us to create a in fact, network of support to young people young women can further their dreams and most interested in making sure they have the full and whatever they need to make that achieveable. Education is important i releases it at my time of san mateo high ii come back to the university of San Francisco law school and the fact i passed the bar will open up many more doors because i feel a curve ball or an where you can in the way cant get down why is this in my way we have to figure out a solution how to move forward we cant let adversity throw in the sorry about that. Hello, everyone. Thank you for joining us today. Just a friendly reminder for those who are joining us for the first time. This platform is only for members of the press. If you are member of the public, watch the live stream on sfgov tv on the youtube channel. Keep yourselves on mute and also keep your videos off as well so we dont distract from the remarks. If you have any questions at the end, i do want to let everyone know we do have a hard stop at 11 30 to be mineful of the directors to be mindful of the directors time. If you have any questions, please submit them to us by chat and well receive those questions and try to submit as much as we can with the time that we have. Please remember to give your full name and outlet and no more than two questions. And depending on time and the type of question we might take it offline as well. Thank you, all, if for your patience, and i will pass its on to you director colfax. Well, good morning, everyone. Im dr. Grant colfax, director of health for the city and county of county. Tos today im going to provide an update on the covid19 pandemic in San Francisco looking at health ind kaytors and other data. Unfortunately, we are experiencing a surge in covid19 infections that is affecting our communitys health and our reopening plans. As a result, we are forced to continue to pause our reopening plans until conditions improve. We are, we have been, and we continue to be in a period of uncertainty, and i want to acknowledge that is a really hard place to be. We all need to continue to do what we know works. We can flatten the curve and we can do it again, but if we do not, the consequences could be dire. In terms of where we stand today, both locally, regionally, and nationally, in San Francisco we have 4,696 cases diagnosed of covid19 and sadly, 50 deaths. In the bay area region, approximately 37,500 cases and 667 deaths. Across the state, 346,000 cases and over 7,000 deaths, and across the nation, cases and deaths continue to rise. 3. 4 million cases and nearly 137,000 deaths. The virus is not only still out there, it is out there more than ever before. It continues to spread locally in our community and throughout the bay area region. We are working with researchers who are seeing the reproductive rate of the virus continue to claim above 1. Right now we estimate that that number is now approximately 1. 3. That means that each person who is infected with covid19 is passing the virus on, transmitting the virus on on average to more than one person. It is key that we get that reproductive number to 1 or lower. It is key for us to move forward. Now, 1. 3 doesnt seem that different from 1, that far from 1, but if we do not do better, we are looking at major problems by late august and september with an average peak an average peak of 900 hospitalized patients by early october. And just to put this in some frame of reference on the last surge in april, we peaked at 94 cases. This average scenario of 900 cases is nearly 10 times worse and it is certainly not the worst Case Scenario that we have by that time. Models show that we could have thousands of hospitalized cases by then. Todays tracker show that there are 92 covid positive patients in San Francisco hospitals. That includes 76 San Francisco residents and 16 transfers. Lets look at the Health Indicators we are using to monitor our covid19 response in the city. These are available on the San Francisco data tracker, and you can reach them from our departments website. They are scored by color. Green, yellow, orange, and red to make it easier to see at a glance where we stand and theres detailed Data Available for people who want to dig a little deeper. Right now the indicators show that we have reason to be concerned. Our cases per 100,000 and the case rate has increased to 7. 7. That is in the red zone. Our goal is to keep the case rate around 1. 8. We are red. In terms of our Hospital System, the rate of covid19 infections which really represents the slope of that curve that we work sod hard and successfully early on to flatten, that rate is now increasing at a 33 rate. That is red. That is cause for grave concern. Our goal is to keep that curve increasing by less than 10 . Our other hospital indicators are thankfully still green. Black is our capacity to take care of people across the nine Hospital Systems in the city. Right now we have 27 of the acute care beds available and 28 of the intensive care units available. With regard to testing, our testing indicator is green. We are coveraging 2,950 test day across the city. With our that is far exceeding our goal of 1800 tests. Certainly as we are seeing across the region, across the state and nationally, our testing system is experiencing delays in access and getting results both within our city system and with private providers. Our numbers are high at 20,950 in the green range. With regard to Contact Tracing, we are at level yellow reaching 85 of cases and 85 of contacts. We expect that that indicator to turn orange this week due to delayed test results reporting and our increases in cases. The Contact Tracing team is working hard to catch up and will continue to expand staffing of that program. In terms of our personal protective equipment or ppe, we are on level orange with 78 of the Health Department having a 30day supply of ppe. Im sorry, let me rephrase that. Across the Health Department, we have our ppe supply is 78 . Our goal is 100 . We are experiencing some issues in terms of obtaining ppe likely due to the increased National Demand for ppe supplies. San francisco and the challenges across california the virus is spreading at Dangerous Levels and this week the state announced a roll back with additional restrictions for counties on the states watch list. Approximately 30 counties are on the monitoring list as of today including several in the bay area. We know the bay area region is an interdependent region where they live, work, and play across and covid19 knows no county lines. If any county in the region is in trouble, we are all in trouble. That is why a regional approach has been key ever since this pandemic started, and we continue to be in touch with the hub area officers sharing data and solutions to keep all the communities as safe as possible. And it is certainly possible if our conditions do not improve, a roll back may be necessary in San Francisco in other parts of the bay area as well. Whether thats a roll back through local action or through state determined access rules will continue to be watched. But this is a tool to control the situation and we have always known that this is the possibility given the unprecedented situation in the uncertain situation we continue to face. No one wants to be in the situation were in. And as we look at the rise in cases, many of them are because the people have started to gather with friends and family and others to socialize. And i realize how hard these months have been for us and the sacrifice that all of us have made. These visits are really hard to resist but the truth is that they are spreading to covid. The birthday parties and visits with parents or grandparents, cousins, the barbecues, they are contributing to a delay or rollback in reopening of businesses or even the first day of school. Another key behavior that we all need to do is cover our faces indoors and outdoors when people are around you who are not part of your immediate household. This is critical. Research shows that masking significantly lowers the rate of transmission and 80 of people wear them. Adherence to facial coverings and masking is so key. One cannot tell by looking at someone if someone has covid19. We know that people are asymptomatic at some stage of their disease and they can transmit it when they are asymptomatic and being safe and wearing facial coverings and social distancing and using good hygiene is key to our success. And the simple act of wearing a mask will slow the spread of the virus and lead to lifting shelter in place restrictions. For those who are wearing masks, we are truly saving lives and those who are not taking precautions, you are not helping. The situation is becoming more serious every day. Please wear a mask and do not gather. Stay 6 feet apart. And wash your hands. These basic acts will make a huge difference if we do this together. We have flattened and we even crushed the curve before and that curve is now escalating and we all need to do better. And until then, our real thing is on pause. And until then, our reopening is on pause. We are not able to open up personal services, indoor museums, aquariums, outdoor swimming pools, Indoor Dining, outdoor bars without food, real estate open houses, and other activities that encourage people to gather and make it harder to wear a mask and social distance. And while it is hard to slow down the reopening and that we all want so badly and the price we pay for moving too quickly is very high. Remember, this virus has no timeline. That is why it is up to us and now is the time despite very curious numbers that i reported to you in terms of our hospitalization. We have a window to make a difference. We can still drive that number to one or lower that reproductive number by the interventions i just went through. We have a window to do this and it will make a huge difference in our hospitalization rates and the number of lives saved. We have shown that we can join together to make a difference, and we need to do it again. Truly, the power is in our hands. And even in the Uncertain Times we know for certainty what are the right steps that we need to take. We can have a thriving city with the healthy population and a renewed economy if we work together. Thank you. Thank you, dr. Colfax. This should be better. The first question and i do just want to say to everyone joining us today that we did receive another question and we will take them in the order they were received. And any others that we cant take in time we will simply take offline. Thank you for your patience. Dr. Colfax, the first question is from christian captain. Can we please explain the role schools could play in the state of covid19 infection rate . The School District announced that students will be Distance Learning when School Resumes august 17. Theres been a lot of talk on federal and local level about local kids getting back on campus. What will it take to get San Francisco kids back. One thing it will take is for us to be confident to reopen schools safely for the buildings to reopen, and certainly we are going to need to see a decrease in that reproductive rate and continue to follow the data and science to ensure that the support systems are in place and that people are able to physically distance and that the most vulnerable are protected in the settings and emphasizes the need to have the safety protocols in place and followed using the best evidence we have in terms of transmission. So we will make the decision about whether it is safe to reopen the physical spaces depending on where we stand with the virus and where with our surge in the city when the time comes. Thank you, doctor. Next question, the governor issued new order this is week to try to wrestle the california surge back under control. The order includes statewide closures of bars, Indoor Dining and other activity but those werent happening in San Francisco anyway. What places or events are currently the main source of infection and how are you in addressing the sources . We think it is a combination of factors and increasing the number of cases in the city. And there is clearly increased activity in terms of social gatherings that people are having and we really need to insure that people are taking the precautions and not making those and not having those birthday parties and barbecues moving forward as much as possible. And focussing on the prevention, education, and neighborhood by neighborhood and street by street and going to be so critical. And we are reinforcing the work with Community Partners to insure Community Champions that people have the resources and the knowledge they need to be safer. The other key components of this are that we continue to see infections among essential workers and we think that may be do to certain work place conditions that safety precautions are not being followed. We will be looking at that and enforcing and increasing our oversight and enforcement required precautions and the Health Orders that have been established and we will also be looking at the existing businesses and looking back at the data and potentially what is on the table for that. And i will also add that we have known since the beginning of the pandemic that crowded conditions that promote the spread of the virus and really again working with Community Members and multigenerational households to ensure and getting people tested and taking precautions to protect themselves as well as their Family Members. Thank you, doctor. Is the country considering the Outdoor Dining and reverting to takeout only as a way to reduce gatherings . Are there plans to cite businesses for Health Order Violations in your counties . We are taking one thing that is clear from the data is indoor activities are riskier than Outdoor Activities overall. We know that the virus spreads more easily and more quickly in indoors than outdoors. And we are taking a look to determine whether this increase in cases is driven by some of the Outdoor Dining and Outdoor Dining and we think this is more due to the noninsurance of some of the businesses rather than rather than the risk thats taken and the relatively smaller risk that is there and if the proper precautions are taken. And outdoors and dining and drinkings and not adhering to the masking and social distancing rules and is at a higher risk. And looking at increase in enforcement and in businesses and institutions and focussing on individual enforcement and enforcement of individuals but really looking at the potential enforcement of institutions and businesses that are not complying and doing the enforcement and the institution and right and Small Businesses are not able to necessarily comply at baseline and what can they do to improve their compliance and support and workers to be more safe during the challenging time. Thank you. Next question, doctor, are you ordering residents to stop gathering outside with masks if groups are keeping to under 10 or 12 people . So at this time we are encouraging people to minimize gatherings as much as possible, to wear a mask if you are in close contact with others and to socially distance whenever possible and certainly if people do better in these small groups that they gather outside is much, much safer. So those are the key components to this right now. And we know theres a lot of need to improve that appearance to the facial coverings of the social distancing. I think we know and we have seen particularly when people know each other and good friend or Family Members but not members of the immediate household, it is ward to wear a mask and keep socially distant. We want to hug people and we want to engage. We dont want to think a loved one who is not a part of the immediate household or good friend may be infected with covid19 which is why we really need to get the messages out and support the communities most affected by covid19 to drop this reproductive rate below 1. Thank you. Next question. How will the Current Situation effect decision to reopen indoor pools for summer camp . So we have put a pause on any additional and include outdoor pools at this time. Thank you. Next question, and what surge sites are ready to be set up and the Hospital System reaches capacity and when will that be done . Right now we have Hospital Capacity per indicators and again you can go to our website and see that capacity across the nine Hospital Systems and we are in the process as we have been a number of weeks preparing for a greater surge and i want to be clear here. We all need to do our part so that we dont get to that point. We have seen when this virus overwhelms Health Care Systems such as in new york city as it is now doing in arizona, florida, and the southern part of this state the outcomes are poor. Theyre much poorer while we have had 50 people die in San Francisco of covid19 and that is too many and one death is too many and our death rate is significantly and bend the curve here again and not overwhelming the Health Care Systems to move forward. Thank you, doctor. How will the city enforce the latest orders . Im sorry. I missed the first part of the question. Last question from San Francisco chronicle. How will the city enforce the latest orders . So we are working across the city to strengthen our enforcement capacity, and that will be a culmination across different cities and Department Agencies including the Health Department and the City Attorney. If people see violations the violation of the health order and businesses and call 311 and make a report and send people out to investigate. Thank you, dr. Colfax. This concludes todays press conference. For all of you joining us today, we took the questions in order and the number that they were received and all other questions will be taken offline in the interest of answering them. Thank you for joining us today. Thank you. It is so key here. We have a window to do better. Next slide. And again, another very concerning situation. This related to the reproductive rate of 1. 25, so this means that we will have more people die, and if you follow that blue line, this means we would average, excuse me, 890 deaths from covid19 in 2020. Were at 50 right now, and by the end of the year, we could be at 890 with a reproductive rate of 1. 25, and again, unfortunately, those white shaded blue lines show we could get much higher scenarios, approaching 2,000, and even 3,000. So this is this is serious. This is a we are in a very concerning time right now with this reproductive rate of 1. 25, and we need to drive down below 1 as soon as possible. Next slide. But there is hope, and this is looking as of july 4, because we were looking at the july 4 weekend and asking everyone to do their part. If we could reduce that rate by half, we could dramatically reduce our hospitalizations and our death. We could go from the hundreds that we talked about to as few as 50 and 70. And even the scenarios that i showed you with those light blue shaded areas, we could see more deaths through 2020. So if we do our part, we could save lives and keep people out of the hospital. Again, even in the next two weeks, if we could all do our part, we could really make a difference. You see in the next two weeks, we wait for the reproductive number to reduce by 50 , we still have peak hospitalization at 340 and an estimated 220 deaths in 2020, so time really makes a difference. Next slide. So key introduction to reducing r. P. E. This the reproductive rate. This has real socioeconomic and other consequences, as well. Discouraging gatherings, especially inside, and i just want to emphasize right now that, really, please do not gather with people outside of your immediate household, and especially do not gather indoors, it is very dangerous to do that. Please, it is literally saving lives. And then, continuing to offer testing, expanding our testing, and Contact Tracing. Such key tools to our efforts going forward. Next slide. So i alluded to this, but really, riskiness of the activity, we know that outdoors is safer than indoors. Its at this point that, based on the latest data, its 10 to 20 times safer than being indoors. Its risking out to be involved in gatherings with people outside of your immediate household. Half of the people who transmit covid19 are asymptomatic. And you can get covid19 right after you test. So dont think that just because you test negative, you can get it from people that you hangout with or you can transmit it back to older people in your household. We continue to emphasize wearing face coverings, 6 feet of social distancing, and washing your hands. The frequency, the more people go out, the more they are putting themselves and their loved ones at risk. The duration, the longer people spend time together, the more risk it is for transmission, and then, the distance. This is why we are focused on the social distancing and the importance of that going forward. Next slide. And then, i did want to talk a little bit about hope going forward, and talk about vaccines are being looked at and developed, and unfortunately, theres not likely to be any vaccines soon. Key experts estimate it could be 12 to 18 months before a vaccine is widely available. Thats very different from saying a vaccine is going to be available in six months to a year. But im hopeful, according to mayor breed, that we will be testing extensively across the city and also at zuckerberg San Francisco general hospital, and we will be focusing on engaging communities most at risk for covid19 to support them in participating in vaccine trials as soon as august. Thank you, mayor, and thats my completed presentation. The hon. London breed well, thank you, dr. Colfax. I know were at the end of our time here, but i do want to take this opportunity to just speak to the people in San Francisco who are struggling. There are some people who are struggling, who have no paychecks coming in, and its really hard. And what happens, in addition to the loss of your financial ability to take care of yourself and even your family, Mental Health becomes a whole other issue. And it seems as without our churches, our religious services, our ability to congregate and come together with one another, our spirituality as well as our coming together in the world, and our ability to socialize as we do on a regular basis, its almost as if were trading one Public Health crisis for another. We know, for example, Domestic Violence has gone up, suicides have gone up, people are more stressed in trying to figure out what to do with their lives. We see some of the Violent Crimes going up in the city. How do we justify that . The fact is you and i know were going to be living with covid for the 12 to 18 months or even longer, and so this is hitting in various ways as we try and keep people safe and try to prevent the surge in the hospitals and even deaths. But theres only so much we can emotionally handle as human in