we build cards to give to our students on what their rights were. under immigration law and in california for them to have. we had those approved in san francisco by the san francisco sheriff. those were things we were not allowed to bring into other jails. if we see something that is injustice and not right, we're not silent on that. it's incumbent upon us to follow the guidelines. which we have been. i can say in san francisco and in other jails, we've had to report some things that we didn't think were right. it's not a comfortable conversation. sometimes it doesn't happen in san francisco so much but in other county, it's been problematic when we report something that's not right. once we've done our duty to report -- the jail and correctional facility is lot different from operating the community. >> commissioner alexander: thank you for that. >> president lopez: okay. thank you for this presentation and for all of your work. i now close the public hearing and we will turn to the regular board meeting. item 3, superintendent matthews? >> thank you. item 3, is the material revision. did you do both, mike? is that a separate item? >> dr. matthews, i was intending to do both. i was intended to go that at the separate public hearing as required. what i would like to do now is confirm with five keys with mr. good, that he is withdrawing the material revision and waiving the hearing. that way we won't have to have a hearing. are you there, steve? >> we are withdrawing material revision for those locations. >> president lopez: thank you everyone. all right, we'll move on to section f, consent calendar. i need a motion and second on the consent calendar. >> so moved. >> second. >> president lopez: thank you. are there any public comments on this item? the consent calendar? >> clerk: please raise your hand if you care to speak to the consent calendar and only the consent. looks like we do not have any public comment for this item. >> president lopez: thank you for checking. any item withdrawn or corrected by the superintendent? >> no. >> president lopez: any items removed for first reading by the board? any items -- sorry? >> commissioner boggess: item 17 and 18 i wanted to have further conversation on. >> president lopez: [indiscernib le] you said items 17 and 18. thank you. roll call vote on consent calendar. >> without items 17 and 18. [roll call vote] >> president lopez: i forgot to acknowledge that ms. correa almanza is not in the meeting anymore. >> thank you. >> okay, seven ayes. >> president lopez: section g, discuss and vote on consent calendar. items 17 and 18. commissioner boggess? >> commissioner boggess: i didn't have a chance to check in with staff before the items came before. i wanted some clarity on what these items covered and kind of the decision-making into these decisions for these two items. >> commissioner boggess, i believe melissa dodd, -- oh, here she is. >> good evening. my apologies if you could repeat the question for me. the two items on the consent calendar. >> commissioner boggess: items 17 and 18. i wanted a little bit more clarity about the items and kind of the decision-making process involved in them and selecting the vendors. >> great. yes. the services provided outlined here for a wide area network and cellular services these are services we provide across the district. they are through our federal program called e-rate which provides reimbursements for infrastructure and technology services. we don't pay full cost. we pay a percentage. in terms of the decision-making process, e-rate has very strict guidelines in terms of how selected vendors or services -- how to select vendors and services. it requires a competitive bid process through an r.f.p. and it results in -- it's typically the lowest bid as well. so we can make sure that we're having the most effective use and efficient use of funds. agreeing to having the board approve contracts is a requirement of the e-rate program. districts apply every year for e-rate reimbursements. that window is coming up at the end of march. to be in line, we will be applying for these services through, e-rate program. the description identifies what the total cost for and the discount portion will be for the school district. >> commissioner boggess: i'm curious how are these dollars or how these funds able to support families having access to internet and cellular connection. >> one of the services the wide area network, that is our core network in the district that supports internet connectivity. the cellular service is what covers the hot spots as well as other cellular and the equipment as well. this contract would cover those services. we have offer internet connectivity currently through a number of providers. at&t is one of our main providers. this also support our ability to provide that connectivity for our students. >> commissioner boggess: as far as the sites, does it give anything to give access to homes around the sites? is that strictly through the cellular aspect that's for families outside a physical school building? >> for home connectivity, that is through the cellular service. we do have our wifi, for example, at our sites, extends particular -- each building is a little bit different. our networks is secure and password protected. one would need an sfusd log-in to access it. there are families that live in that vicinity or students, they are able to log on to the network outside of the building. there are strict guidelines for the e-rate reimbursement portion that they are used primarily in schools and for educational purposes. i will share that districts including sfusd, and other organizations, have been pushing on extensions and expansions of that particularly during distance learning. we work prior to as well. there is some new -- as part of the new legislation and funding, there's additional funding that is identified for broadband or internet connectivity. that is going through the federal legislative process as we peek. >> commissioner boggess: thank you so much for that. those are all the questions that i have. >> president lopez: thank you commissioner boggess and chief dodd. are there any other questions from commissioners? roll call vote. >> commissioner boggess is it okay if i take both votes on 17 and 18? >> commissioner boggess: both together will be great for me. >> thank you very much. [roll call vote]. >> president lopez: thank you. moving on osection h. special order of business. there are two action items. item 1, 213-9s '01, qualified certification for the san francisco unified school district and qualified fiscal certification for the san francisco county of education at second interim fiscal year 2020-2021. may i hear a motion and a second to special order one? >> so moved. >> second. >> president lopez: thank you. superintendent matthews, can you introduce the designee to speak and read the recommendation in the record? >> thank you. our designee for this item is our chief financial officer, meagan wallace. >> i'm going to be speaking to this item. thank you. good evening dr. matthews. request before you is for the board to approve a resolution authorizing staff to submit the district and county office of education second interim report for 2020-2021 to the california department of education with qualified certification. a detailed presentation was given to the budget and business services committee last wednesday march 3rd. i will start with a high-level summary. in summary, staff advises that we'll be able to meet our physical obligations in the current year and in the first year of our multiyear projection, which is fiscal year 2021-2022. we are continuing to project the deficit for the second year of our multiyear projections with a $112 million deficit anticipated for fiscal year 2022-2023. we are recommending a qualified certification. however, in the current fiscal year, staff is projecting the district and county office is continuing to maintain a covid-19 reserve, approximately $4.3 million. that is sufficient to support reopening schools over remainder of the fiscal year. additionally, the projections for fiscal year '21, '22, includes federal and state funding that is substantial enough to address covid-19 responses. for that second fiscal year, depending on the willingness of the district and the county office and implement appropriate ongoing budget reduction, we are maintaining a qualified certification for that second year. with that, i do recommend approval of this resolution and i'm happy to answer any questions. >> president lopez: thank you. before we do that, i like to open it up to public comment on this item. >> clerk: thank you. please raise your hand if you care to speak to the certification qualified fiscal second interim report. we have two hands up. >> president lopez: all right, two minutes. >> clerk: hello, elizabeth? >> hi there. my name is beth kelly. i'm a mom of first grader at clarendon. just a couple of remarks, one is -- the qualified certification is very serious thing. i haven't yet really seen any serious thought being put forward by board members with the exception of commissioner boggess. i really thank you for your thoughts especially during the last budget meeting. i know i and i many other parents like to understand what the plan is for how this is going to be addressed. just couple of quick smaller items. it will be good to know -- have a little bit more clarity on what the federal stimulus will look like. in the report, in one place it said it will be $84 million and in another place it says $103 million. that's on page 17. that type of thing matters. also, on 26, it says the district has reports that indicate physical distress than those should be publicly available so that folks are in the know. there has been decline this year in enrollment. it also assumes a.d.a. is staying constant. i think that this is going to be a very, very important process. i want to everybody to put their most thoughtful foot forward. i want to make one last note, from what i seen so far staff is doing a really good job. let staff do a lot of hard work and bring some solutions forward. >> clerk: thank you. hello? >> similar to what the last caller just brought up. i know that as we go through the process of understanding enrollment and enrollment changes that obviously changes the picture. i'm interested to see the range of assumptions you're using about the '22, '23. what kind of enrollment assumptions was built into it compared to current state. what sort of recommended actions the board is considering to close the gap? it is not insignificant gap >> clerk: thank you. julie? >> hi. i want to appreciate all the hard work that staff and the board are putting into the budget questions. i wish i could say that it was unusual in public schools to be wrestling with this instability and deficits. i'm wondering if the board or staff can provide some updated numbers for us to have context? couple of years ago, we did some research and identified across the country, the average per people spending on public schools was about $16,000 compared to palo alto, they spent $16,000 and san francisco spends $11,000 per students. we're a rich city. after prop 13, san francisco investment in public school was only 8%, which was the lowest in the state except for a tiny town of a thousand. that historic systemic racism has been baked in the budget ever since. i'm wondering if staff could help provide context, help us understand what -- how our spending levels currently compared to funding levels in other places. i like to see us continue to advocate for both city, state and federal funding to ensure that san francisco, the rich city that we are, invest at least per pupil average in our students. the few issues that i'm seeing is related to gentrification. i'm also curious about if we're anticipating a kindergarten baby boom as families who may have kept their kids back in pre-k, maybe trying to apply for kindergarten in larger numbers than we've seen before and how we might be planning for that both in terms of budget and classroom space. thank you. >> clerk: that concludes public comment on this item. >> president lopez: thank you. now questions or comments from commissioners? >> commissioner lam: we had a pretty long detailed discussion and review during the budget and business services. this was reviewed second interim. it is -- i appreciate the staff and all the work meghan wallace and team and deputy superintendent lee have really put the intentionality of both forecasting scenarios between this upcoming fiscal year. it was important that we have a more longer approach, time frame of a zero base budgets which we began as a process. so we could involve more, for example, site leaders to be part of this process as well as just a more robust process. because we know the financial outlook now, multiyear projection is a very challenged one. some tough choices are going to have to come before us and should we continue not see the additional investment at the federal level or state level of any increases. with the federal stimulus, thank goodness that was signed and approved by congress and by the president, the fact that we're looking at one year. that's where you see the fiscal cliff. that is something that i'm committed to, the committee is committed to really look at working with staff around that planning that transparency and the scenario consideration moving forward. i wanted to state -- there has been very detailed discussion, strategy, consideration over the last several months because we know these interim reports are very important to us as a district how we monitor ourselves, how we're doing with our revenue projections and expenses. i wanted to thank the staff for really doing the planning but also really keeping us on track. >> commissioner boggess: i have some questions. i will say too, lot of appreciation to staff and also the committee who kind of had this before hand and the board members who's been working to have our budget process move forward. i would definitely say, monitoring the school district's budget. it's very complex and hard to understand. that is a reflection of how the state has set up the budget process in the way that the state really shortchanges school districts like ours. it doesn't give us enough money to do what we need to or give us access to money at the right time. lots of appreciation to the folks who are doing all the things that it takes to keep us moving it forward and to prevent a state takeover of our school district. i think the primary question that i have is do we have enough money to meet kind of all of our commitments to support student learning needs during this time? is that kind of reflected in this document? >> i will speak to one of the questions about the different federal funding levels. we're currently anticipating -- the number we're using is $103 million allocation from this federal stimulus package. 20% of that needs to be earmarked for learning recovery. that's why you will see one reference and about $82 million in another. board actually required. therefore to get to and make some investments using those federal funds for learning recovery. on top of that, we know that the state grants proposal, within that $6.6 billion announcement, there's also learning recovery fund of which we're anticipating about $39 million. the combination of those state and federal funds, we may find there are things that we currently fund or may be looking at resolutions that support learning recovery. we might see some alignment with things that we're already investing in or the board passed in resolution to use those funds to support. otherwise, those funds need to undergo a planning process where we would be making new investments. >> commissioner boggess: through that process, we would have enough money to meet all of our commitments and obligation to students, especially special education students and kind of all the things within their i.e.p.s? >> yes. to that, i wonder if the deputy superintendent want to speak to that more. it maybe too early to really speak to that planning. there are conversations, we're trying to move quickly to figure out plans. we do need to provide the state with plans for how those funds will be used. >> terms of the timing question that wallace mentioned, this was for the purposes of the state learning recovery fund. this is the pot that was part of ab86, which was passed couple of days ago. that's the $39 million pot. one of the conditions for receiving those funds is for the board, the governing board to adopt a plan for the use of those funds by june 1st. i don't think we highlighted that in the committee discussion. that is something that is going to be coming forward to the board probably some time in may. that's a process point. to your substantive point. we are very pleased and in a way relieved that there has been enough dedicated funding for learning recovery outlined in both of these federal and state sources that we can meet our needs. our needs are very deep and broad as you all know. i don't want to overstate that. this is a rare instance in which we're feeling like the state and federal government have recognized the scale of the investments that we and our counterparts up and down the state do have to grapple with and certainly our educators and families and students have to grapple with in light of this pandemic and the difficulty and trauma that our students have experienced in the past year. we would hope for more. we hope for on going funding rather than one-time funding. the amounts that have been identified so far, we are pretty comfortable so far. >> commissioner boggess: the big takeaway for me, we plan to be able to do that. there will be more details about what that looks like for our school district as we get closer to june as we have to submit that information. for families, students and community members looking for that more nuance detail. that's going to be coming up at a later point. versus what they will see tonight and this version of it. i appreciate that. >> president lopez: any other comments from commissioners? roll call vote. [roll call vote] >> that's seven ayes. >> president lopez: item 2 under section h. 213-9s02, tentative agreement between sfusd and uasf, local common crafts regarding health and safety standards. >> moved. >> second. >> president lopez: superintende nt matthews. >> thank you. reading the recommendation into the record to present this item will be our chief of labor relations greg jones. >> good evening and superintendent matthews. this item should look familiar to you. it's coming back again. we have -- our labor units have been signing on to the agreement. the action is to ratify the tentative agreement between sfusd, uasf, uesf local 6 and common crafts. to remind the board to reach an agreement on m.o.u. with all district employees. attached now are the latest set of signed agreements. this the baseline health and safety conditions for the reopening of schools for in-person learning. the recommended action is to rat -- ratify this agreement for this evening. >> president lopez: thank you. i know there are lots of moving pieces. can we see if there's any public comment on this item? >> clerk: please raise your hand if you plan to speak to the tentative agreement. seeing none. >> president lopez: questions or comments from commissioners? seeing none. we'll do a roll call vote. [roll call vote]. >> seven ayes. thank you. >> president lopez: great. we are nearing the end of our meeting. section i, board members' report. report from recent committee meetings. the following committee meetings have taken place since the last regular board meeting. the chair will report -- just to prepare everyone. we'll hear from rules, policy and legislation. we'll hear about last week's committee of the whole. commissioner lam, i'm not sure if you need to share more regarding the budget meeting? you have the opportunity to do so. we had a curriculum meeting yesterday. let's start with rules. >> i'm excited to report that i did know that i was reporting this time. we had a very lively and interesting rules committee meeting where we had lots of discussion about some of the state legislation -- first, and foremost, we talked about the reopening, in-person reopening agreement. we have a discussion of the situation there. we also talked about the situation over testing and the guidance given by the u.s. department of education and then the state department of education response to the federal guidance around testing. i think commissioners are aware that president matthews has put a pause on our state testing here at sfusd until after the next meeting of the state board of ed. which is march 17th i believe. so we can discern what is happening there. i'm happy to provide more detail. finally, we looked at some specific legislation and took position in support of two bills both by -- sb14, which would add mental or behavioral health for reason to receive absences statewide. we would add mental health as valid for student absence. sb224 which would require mental health education. one in middle school and one in high school. next month's rules committee meeting we'll be going more in-depth on other bills and determining whether we'll be taking a position. >> president lopez: thank you. we usually have a competition to see which committee is the best. >> it's clearly rules? [laughter] >> president lopez: coming up is vice president collins report out on our report of the whole from last week. >> vice president collins: we had a pretty and detailed meeting. i encouraged -- we got a lot of updates, focusing on two buckets. one is facilities. if folks want to know how many windows are being prepped and about moving plans that's contained as well as we heard a little bit about thinking around outdoor education. the focus was mostly on using outdoor space. i know there were questions to see if there are ways to expand capacity by going outdoors. that's to be determined. there's also discussion on ventilation which we got an update on. then getting into the second half, we discussed instructional plans, focused on high school. we saw a little bit of the planning that was around 2b, which is high school students that are priority students to bring back which includes foster youth, students that are unhoused, students needing public housing and s.r.o.s and incoming students. that is going to be a follow-up. we provided -- one of the long conversations that got confusing, i want to clarify. i saw some chatter on social media that we provided -- i guess the question that was posed to us where we house those students. if we put them all in the few building or if we put them in their home schools. like we are doing with elementary schools. the consensus that i heard from the board was that we all wanted to see staff develop plans to bring those local students back even if it's only one or two classrooms. we do those within the schools where the students reside. with the hope that can allow us to expand services to other students whether that be athletics, extracurricular or clubs. anything we can do to increase capacity at the high school, middle and high school level. that one i'm hoping. i don't know we'll be able to do this. additionally, we got preliminary information on summer school. although that one is in process. we'll see when we can do this. my hope is we are going to be using committee as a whole meeting as reopening updates where we can really go in-depth on specific topics. my hope is that either at the next committee of the whole or at a future meeting, we can go in-depth on summer planning. we can also eventually get an update on ventilation and a variety of other -- i guess we'll also want to be getting feedback on surveys that are going out currently. that kind of data will be useful to see what current demand is and how we can potentially expand to wave three and our third and fifth grade. i want the public to know if you want to go to more of our meetings and see more discussions in detail, they're all on the website. you can go to sfusd.edu. that includes all the committees. you can go to about and you'll see board of education and in there you can look for the archive. i really appreciate our staff, mr. steele and ms. cassco has been updating. after tomorrow this video will be uploaded for folks who can't attend. that's true for every meeting and committee meeting. i wasn't able to see the curriculum meeting yesterday. i will go back and watch that. those are opportunities for the public to see more of that directly. i wanted to make a plug for that. we have built out that page and it's updated regularly. >> president lopez: great, thank you so much. commissioner lam, did you want to add any more? >> commissioner lam: i gave the summary during chief wallace's presentation around second interim. just lots of work ahead and deep dives in making sure that we are fiscally sustainable. >> president lopez: we appreciate your work around this. lastly, commissioner boggess? >> commissioner boggess: just to highlight that a resolution came through the curriculum committee sponsored by commissioner sanchez and alexander, resolution number 212982 in support of suspending administration -- [indiscernible]. that's something coming to the whole board. we had updates on language arts with a focus on literacy as well as update on slam, which is sports, libraries, arts and music. we'll talking about those things also at upcoming the committee meeting as well. that is the update. >> president lopez: thank you for that. to all of our chairs for holding this work. item 2, board delegates to membership organization. is there any updates? seeing none. item 3, all other reports by board members. seeing none. calendar of committee meetings. i will announce the upcoming meeting just to read in the record. budget and business services will be april 7th at 4:00 p.m. building and grounds and services will be monday march 22nd at 4:00 p.m. curriculum and program will be april 12th at 4:00 p.m. rules, policy and legislation will be monday april 5th at 4:00 p.m. the ad hoc committee on student assignment is to be determined. there's a lot of work around that. the ad hoc committee on personnel matters labor relations and affordability will be monday march 15th at 3:00 p.m. >> just a quick question on the committees. i wanted to ask if for personnel and labor relations, since we haven't had that in a while, it's an opportunity for us to be responsive to staff concerns as they are returning to in-person learning. i was hoping that -- as we're talking about returning to in-person learning, we can make staff a priority terms of listening to and supporting them. >> president lopez: great, thank you. i believe the chair of that committee also in on that. section j, memorial adjournment. superintendent matthews? >> thank you, president lopez. it's with great sadness that i announce the passing of maude pierson green. she suffered a heart attack shortly after the holidays and was hospitalized at kaiser. ms. green was a longtime assistant curriculum instructor at lowell for me, she was a science teacher. currently in the district, we have infinity group. i get jealous from people who talk about they had their first african-american teacher in the first grade or second grade or third grade. for me in the san francisco unified school district, i had my first african-american teacher as a junior in high school. that teacher was ms. pierson. at that time. ms. pierson was an anti-racist instructor before the term was coined. she went out of her way to actually ended up in her physiology class. she found me in the hallway, she asked me my name. she said you're signing up for my class next semester. i did. it was the best class and one of the best friendships that i ever had. ms. pearson, she was an anti-racist instructor. that really was about how high quality curriculum. knowing her content, it's about pedagogy and how she taught. she built a relationship with all the students in her class. she was everyone's best friend. she is one of those people who absolutely made me who i am today. i want to say to ms. pearson's family and friends those who knew her or had the opportunity to be taught by her, we are better people for it. she will be missed. just a thank you to ms. pearson, thank you to her family for allowing her to be shared with us. >> president lopez: thank you superintendent for sharing. i like to call on vice president collins. >> vice president collins: thank you. this is an ongoing agenda item. as we see hope and with the vaccine making its way around and becoming more valuable, we also want to recognize that there are still many families and staff that are being impacted by covid. we want to hold space. this past weekend i attended a memorial for one of my family members. there are families grieving now. we want to recognize that and we want to hold community and share support for one another. california has 33.6 in cases and 55,000 deaths. in the united states, we've experienced 29 million cases and 527,000 deaths. i believe that has now surpassed when i started talking about this, surpassed -- it's been the highest death count beyond anymore. i want to hold space and share my thought and condolences for those of us who have become ill or have experienced loss due to the pandemic. right now, i'm asking for folks to take a moment of silence in remembrance of those that we've lost this past year. [moment of silence] >> president lopez: thank you. thank you vice president collins for continuing to remind us. with that, we will now be moving into closed session. at this time, we will take public comment for those -- we'll take public comment in closed session item in a total of five minutes. >> clerk: thank you. please raise your hand if you care to speak to any close session items today. hello, josephine? >> yes. i'm not talking about closed session, i wanted to talk about opening of schools. >> clerk: sorry, that already passed for this evening. there will be more opportunities coming up later. thank you. >> bye. >> clerk: there's no more public comment. >> president lopez: thank you. again, mr. steele for holding this work. the board will now go into closed session. i will call a >> clerk: reconvene from closed session. item 1, report on closed session. on item 1, vote on employment contracts for unrepresented chief executive employees. i move to issue a may not renew notice to three deputy superintendents. can i get a second? is. >> second. >> roll call, miss casco. >> i'm sorry. i'm not hearing the second, when somebody said second. >> i said second. >> okay. thank you. thank you very much. are we ready for roll call? >> just to clarify, this is -- a yes vote in favor of the may not renew? >> yes. ready? >> mm-hmm. >> okay. [roll call] >> clerk: that's seven ayes. >> okay. i move to issue a may not renew notice to the chief technology officer. i need a second. >> second. >> roll call, miss casco. >> clerk: thank you. [roll call] >> clerk: that's seven ayes. >> thank you. i move to issue a may not renew notice to the chief of staff. i need a second. >> second. >> thank you. roll call, miss casco. [roll call] >> clerk: that's seven ayes. >> i move to issue a may not renew notice to the chief of labor relations. can i get a second? >> second. >> second. >> roll call. >> clerk: okay. thank you. [roll call] >> clerk: seven ayes. >> i move to issue a may not renew notice to the chief of facilities. can i get a second? >> second. >> roll call, miss casco. >> clerk: thank you. [roll call] >> clerk: that's seven ayes. >> i move a may not renew -- move to issue a may not renew notice to the chief of planning. can i get a second? >> second. >> roll call vote. [roll call] >> clerk: seven ayes. >> i move to issue a may not renew notice to the chief of sfcsd. can i get a second? >> yes, second. >> roll call vote. [roll call] >> clerk: seven ayes. >> great. we are about halfway. i move to issue a may not renew notice to the chief of human resources. can i get a second? >> second. >> roll call. [roll call] >> clerk: that's seven ayes. >> i move to issue a may not renew notice to the chief of policy and operations. can i get a second? >> second. >> roll call. [roll call] >> clerk: seven ayes. >> i move to issue a may not renew notice to the chief of curriculum and instruction. can i get a second? >> second. >> and roll call. [roll call] >> clerk: seven ayes. >> i move to issue a may not renew notice to the chief of special education. can i get a second? >> second. >> roll call vote. >> clerk: thank you. [roll call] >> clerk: seven ayes. >> i move to issue a may not renew notice to the chief financial officer. can i get a second? >> second. >> roll call. [roll call] >> clerk: seven ayes. >> i move to issue a may not renew notice to the chief of early education. can i get a second? >> second. >> roll call. >> clerk: thank you. [roll call] >> clerk: seven ayes. >> all right. that wraps up item 1. item 2, report from closed session. the board, by a vote of seven ayes, voted to issue notices to seven superintendents that their vote may not be reviewed. the board, by a vote of 7-0, voted to issue to notice to six contractors that their contracts may not be renewed. and with that, we have arrived to section m, adjournment. good night, everyone. >> i will call this meeting to order, march 11. this is conducted pursuant to the brown act and recent executive orders issued by the governor to reduce the risk of covid-19 transmission at public meetings. ordinarily there are strict rules for teleconferencing. the executive order has suspended those rules. as noted the agenda, members of the public may observe the teleconference meeting via sfgovtv and they may also call the public comment phone number. i would like to welcome the members who are watching this live on sfgovtv. mr. secretary. please call the roll. >> thank you, vice chair gee. rafael mandelman is joining usury placing matt haney. director lipkin will not be present. please respond when i call your name. forbes. >> present. >> baptist present. >> mandelman. >> here. >> director shaw. >> here. >> director tumlin. >> here. >> vice chair gee. >> here. >> we have a quorum. i will call your next item. 3. communications. the number is on the screen. director mandelman has to leave at 10:00 a.m. we will rearrange items to ensure his participation. any other communications from the board at this time? seeing none, i will call your next item. 4, new and/or old business. i am not aware of any. next item. executive director's report. >> good morning, directors. i would like to welcome supervisor mandelman filling in the seat held by matt haney who resigned february 18th. i look forward to working with you. as i stated i am thrilled by your enthusiasm to deliver the vision for the transbay program. yesterday congress passed $1.9 trillion american rescue package to be signed tomorrow by president biden to provide much needed funds to transit operators. we join the m.t.c. and transit operators in thanking speaker pelosi in getting this package passed. we are working for formula funding for the pandemic. we respond to federal opportunities on the horizon. we will be ready with ask when requirements are released. we work with our federal advocates to take advantage of these opportunities. there are three categories we are looking into. the infrastructure later this year, earmark requests focusing on project funding for transit center capital items and grant opportunities. consolidated rail infrastructure and security grant program. we are optimistic re-opening the city. we are now in the red tier. we have heard good news to move to orange in the next two weeks. red allows opening indoor and outdoor activities. we are continuing to work with our parks programming partner and plan to offer activities in the parks as allowed by the health order. john will speak more in detail. we will continue to monitor the safer at home to ensure the collective efforts to reduce spread of covid-19. adhering to guidance with the health officer and working with transit operators and tenants. we will continue to provide visitors and commuters the most up-to-date information. additionally we will monitor security and safety of riders and visitors. monthly our security team holds monthly meeting with the operators and personnel from the transportation security administration. remain engaged and informed on trends and topics to impact the transit center. >> we issued r.f.p. as our current term ends on june 30th. it allows two additional one year terms it is a reset considering the budget constraints. we continue to advance downtown project with patterners. -- partners. over the last month we provided briefings to the transportation chair to introduce to the project. we plan to engage the federal delegation this month. additionally, with chair chang we are providing briefings to the supervisors including president walton and the newly-elected chair and board director mandelman. we have provided briefings to regional commissioners at m.t.c. newly-elected chair. mountain view mayor and santa clara supervisor and the oakland mayor. we have more briefings scheduled to provide information later in the agenda. this past tuesday the san francisco county transportation authority unanimously approved on the first reading for the prop k $6.2 million to advance the project. it will be brought to this board for approval in april upon final approveval on march 23. i want to thank the staff for working with us for this allocation. continuing in the spirit and intent of the partnership developed under the rail program, memorandum of inning. they will provide additional information as well. as mentioned last month the high-speed rail authority shared revised draft 2020 business plan. provided support during the comment period that ends tomorrow. we also showed support and sent in support letter for the joint assembly informational hearing on the plan and budget allocation yesterday. we join the partners in voicing support for this project. lastly, we concluded recruitment at the end of february. later we will report on the effort and pool of candidates. i want to recognize the outgoing four members of the cac. we have appreciated their questions and insightful feedback. they helped us shape the transit center, services in the project. we want to thank them for the years of dedication. directors you have the quarterly financial reports provided by the chief financial officer before you in your packet. she is available to respond to questions you may have. that concludes my report. i will be happy to answer any questions before i provide the facility update. >> thank you. any questions from the directors? i don't see any hands raised. i don't see anybody waiving. >> seeing none, vice chair gee. >> any public comment. >> no public comment at this time. >> thank you. >> good morning. very quick update. i will start and i know we are pressed for time. as mentioned by moving in the red tier we are able to move fitness sf from outdoor pods to indoor environment. they are indoors now. all of the pods and equipment have been moved back inside. they are thrilled to be back moving toward regular operations. as i mentioned in the last meeting with our neighbor in fremont finishing up today and tomorrow work on the 40th floor with window replacements. you can see window washing on the right and the exciting adventure on the left. that will be done by the end of day friday. we are working with adventures on preparing for programming schedule for the park. the sign of return of downtown and the city. april will have a soft opening and programming. working closely with the sales force committee on that process. we will have a little more activities anticipated but a full schedule already for june for activities in the park. retail leasing. updates on active engagements. some not so good news relative to the food and beverage kiosk vendor. they have due to local corporate decisions made elsewhere to pause discussions with us on a lease. we are back on the market for that site. there are other interested parties. i have confidence we will find a vendor at the time we are ready to serve food and beverage at the park. 232 was a pause button pushed by a prospect not only here but four other locations we were investigating throughout california. we were very far along in negotiations. good news we have shown the space to other interested parties. we have something that looks very interesting we are pursuing. i am hoping to have more information in the next meeting. good news on the first floor is we continue solid discussions with six of our first floor vacancies. a lot of interest in that, which is amazing given the amount of second generation space currently available in san francisco. walk right in. juice bar looks promising, breakfast food operation is an opportunity. it is our retail and restaurants. more on that. no changes to the occupancy 78% from last meeting. tenant improvements. spring fertility signage up. we have received the permits and tweets to happen within the next couple days and opening by the end of the month. that is good news on that front. lastly, relative to our few tenants. no changes there. we are targeting q3 and 4 opening and aligning our work with those programs so that patron age is back. they are open. happy to entertain questions. >> thank you. any questions from the directors? i don't see any hands raised. donald, any hands? >> no hands raised and no member of the public to provide public comment. call your next item. >> please. >> directors 6. cac update. we have the chair to address you on this item. >> good morning. i am the cac. members of the cac voice excitement in the vote on tuesday. we are excited. cac appreciated and took time to acknowledge and thank the out going cac members which were highlighted by director gonzalez. presentations on the fourth and king street rail yards were well received by the cac members and from the san francisco planning department addressed the questions and comments regarding topics such as the fourth and king street rail yard, options for moving, concept options, options for the space around where it will be, it was pointed out that it is environmentally clear and we also spoke about examples of similar projects around the world including new york hudson yards. one member mentioned it would diminish the character of the neighborhood. vertical development would require environmental plans. the presentation regarding the dpx study generated support for the key points. there was discussion of the completion date and acknowledgment of funding delays in the covid-19 pandemic. cac members voiced support for the funding ask that steven's presentation included. jackson spoke of giving thought to the surrounding urban design. there was acknowledgment of the efforts to maintain tenants and get new tenants during the pandemic times. they discussed future agenda items. this concludes my cac report. >> thank you for your report. directors, any questions? any public comment, donald. >> there is none at this time. i will call your next item. >> please. members item 11 is the election of chair and vice chair which will be done in two-parts. we will take nominations for chair. >> somebody needs to be chair. >> i would like to second the nomination. [ inaudible ] >> any other nominations? >> seeing none, do we have a motion to reelect director gee as chair. >> so moved tumlin. >> second, forbes. >> thank you. item 11. first director tumlin and second forbes. roll call vote to direct director gee as chair. >> donald, before you go ahead. public comment. >> we have a caller. >> thank you. good morning. the point of order. number 7 public comment. >> we will come back to that. >> thank you. my apologies for the interruption. >> quite all right. >> thank you. i will now proceed to take a roll call vote at this time. >> director forbes. >> aye. >> director baptist. >> aye. >> director mandelman. >> aye. >> director shaw. >> aye. >> director tumlin. >> aye. >> vice chair gee. >> aye. >> the motion to elect director gee is passed. [indiscernable] >> i would like to nominate director mandelman vice chair. >> second tumlin. >> any other nominations? seeing none, i will check for public comment. please let in the first caller. >> hello. thank you for the opportunity. the first thing i would like to do this morning is to welcome supervisor mandelman to the party, sir. second thing i would like to do is thank chair gee for offering public comment. this is a welcome development and truly appreciated. thank you, sir. the comment on the report is that the best location for caltrain storage is the train box in the transit center itself, not anywhere else. thank you. >> thank you. >> do we have a motion to elect director mandelman as vice chair? >> so moved. >> second. >> vice chair by baptist first and second forbes. i will take a vote for director mandelman. >> forbes. >> aye. >> director baptist. >> aye. >> mandelman. >> aye. >> shaw. >> aye. >> tumlin. >> aye. >> chair gee. >> aye. >> motion to elect director mandelman as chair has pats. congratulations to you both. >> if i may take a moment here. colleagues, thank you for the honor to serve as chair. director mandelman, welcome to the board. i look forward to serving together in your multiple roles as we all have on the board. it is exciting to move forward as well as the san francisco rail program. welcome. i look forward to working together. thank you to my colleagues on the board. a lot will happen over the next year. >> mr. secretary. let's jump back to item 7. >> that's correct, sir. >> public comment. an opportunity for the public to address the authority on matters not on today's calendar. we will wait a couple seconds before we proceed. seeing none, i will proceed with the agenda. item 8 is approving the recommended applicant to the citizens advisory committee. the communications and legislative affairs managers will present. >> good morning, directors. tjpa citizens advisory committee is to advise the board of directors. representing diversity it includes 15 members serving two years with a max of three consecutive years. terms are staggered so seven seats expire in odd years and eight regular years. we have seven seats open this year. january to february we conducted outreach which included promotion on social media along with patterners. the tjpa received nine applications, three from current members who reapplied. after reviewing all applications, staff recommends the board of supervisors reappoint three members as they have been valuable members and have important institutional knowledge. staff recommends that the board of directors appoint four new members which total seven of the eight. the four are. the city-wide business brian larkin, labor seats mandez. bob and for the expertise in real estate development staff recommends sally stall. the ac transit san francisco seat is open. we did not receive any applications for this seat. we are conducting additional outreach to the transit rider community to encourage individuals qualifying to apply. we are working to fill the seat as soon as possible. i have been in touch with director shaw and industry to encourage qualified applicants to apply. we hope to come back to recommend an applicant for consideration. we have new proposed members here. with us this morning and i would be happy to answer any questions you may have. >> thank you. directors, any questions? >> this is director shaw. >> i just want to say that i did reach out from lilly and i have put -- i responded last night there. is one person who may be able to do it. we are doing more reach out. we are pursuing it. thank you. >> thank you, director shaw that is interesting dynamic with companies going to hybrid work models there may be fewer daily riders and more hybrid riders. it is a new dynamic we may need to think through. any other questions from directors? it does look like we have some members of the public who would like to have their hands raised. >> please let in the first caller. >> some of them are proposed candidates. >> first member is newly appointed cac member bob. [indiscernable] please let him in, please. >> can you hear me now? >> yes. i am primarily interested in two aspects of this. one, getting the trains into the basement of terminals. i have been on the caltrain and the high-speed rail advisory committees for some time. that is where i will bring expertise. the other issue i want to raise and be concerned about is financing. i remember a plan some years ago that high rise buildings are expanded buildings would have increased property value tax going to help finance this building and the operations. we just see sales force not into a big lease and other buildings are unleased in some floors. what if any effect will that lessened tenant rent activity in nearby buildings have on the financing of operations of the transbay center? finally, i will ask if i have a question, do i send it through the cc chair jason or to ms. gonzalez. i am not sure how long it will take for my question to get to whoever we want to get information from. that will be an administrative detail, but i want to jump in ready for the april 6th meeting. thank you. i will stay on until you decide if you want to ask me questions or comments. thank you. >> thank you, mr. plan hold. as we conclude the formal appointment today will be orientation for all members so that those administrative issues can be resolved and clarified. thank you for asking your hand and volunteering. >> next caller, please. >> thank you. very briefly. i have known bryan rocking for years. you will not believe the contribution he will make. he will take the tjpa to the next level. i have no doubt about it. thank you. >> that concludes. >> is there one more? >> no, that concludes. i will now take a motion. is there a motion? >> motion to approve. >> second. >> item 8. director forbes. >> aye. >> baptist. >> aye. >> mandelman. >> alternate at this point. >> chang. >> aye. >> shaw. >> aye. >> director tumlin. >> aye. >> chair gee. >> aye. >> there are six ayes. item 8 is approved on first reading. >> if you would pass on the congratulations of the board to the new cac members, please. and thank those that served previously for service and those that want to continue to do this. really appreciate it. >> item 9. approving the minutes of the february 11, 2021 meeting minutes. >> motion for approval? >> motion to approve. >> second. >> there is no public comment. there is a first by director shaw and second by director tumlin. >> director forbes. >> aye. >> director baptist. >> aye. >> director chang. >> aye. >> director shaw. >> aye. >> director tumlin. >> aye. >> chair gee. >> aye. >> there are six ayes. item nine is approved on first reading. >> thank you, mr. secretary. directors, item 10 san francisco pen anyone larail program executive committee update. >> thank you so much, mr. secretary. good morning chair gee, it is a pleasure to congratulate you on your election to the chair. >> thank you. >> happy to report out this month, directors, on the activities of our steering committee and integrated project team. as you mentioned the outreach work we will go over that. she covered that earlier. we will have an update on our funding plan and 2021 coordination and of course focus on the schedule which then vice chair gee asked as well last month about. really it is a pleasure to join the team on the briefing for regional commissioners at the m.t.c. i thank the commissioner for facilitating those. we have met with four to date. i believe the additional ones we have planned include the mayor from san jose and commissioners connelly and rabbit from marin and sonoma to share information and collaborate on whether it is funding opportunities or other planning activities relating to the high interest and enthusiasm for the project. citizens advisory committee, of course. we appreciate in terms of the project director for joining, jessie taylor for that that occurred for the first read on tuesday and completed at the end of the month. no issues with that. it was smooth. we appreciated folks coming out for public comment. state legislative hearings. as gonzalez mentioned is going smoothly one yesterday and another one on the 16th. both agencies have joined to submit comments of support for the high-speed rail business plan 2020. that does include the valley to valley strategy and request for prop 1a funds from the legislature bond funds to help complete that segment and project development activities up to the bay area. on the fta side we have been following up on the kickoff meeting with fta a couple months ago. that has involved the travel demand modeling work. that is moving well. we are seeing consistent with that work. terms of funding, this is the snapshot from the conversations we have been having with fta and commissioners around the bay area. this is the high level outline how we are looking at federal and state and regional and local sources on the project. cost in the process of update by the team but we do believe it will increase up to this level between 4.5 to 5.5 billion subject to the work underway why we look to see what is the minimum amount of project definition and cost. does that may being sense? for initial service. budgeting and funding purposes we are looking at this type of structure. the fta being the largest and most important one before us potential opportunity to ask for up to $2.5 billion. that is the range we shared with fta. this fits well with bay areas already underway new starts program. capital improvement grant to san jose phase one and two as well as full capacity program. along with bart to san jose the caltrain rail extension is a priority in the bay area. state sources are listed here. high-speed rail sources, i believe the high-speed rail business plan identifies the future contribution $550 million not committed yet but the idea behind that line item. regional measure 3 as mentioned before $325 million for the project being litigated. we hope to see that concluded soon. other sources could include the caltrain measure and/or other future regional funding sources such as discussed a few years ago with the 1cent sales measure. the local prop k sales tax. we do hope and plan to go to the voters next year to reauthorize the 30 years at the half cent level. as well as other local sources that we are tracking including private sources as well. the picture of the larger amount of funding breaks down to committed plan and additional sources. under the orange $1 billion committed is a good start. those are familiar to many of you, of course. the middle planned funds, yellow box identifies ones in the functioning plan and re-confirmed. that is something underway right now by the team. these include the ones just mentioned and potential facility charge or train flat fee not agreed yet but it has been carried over from the prior funding plan and will be discussed with the other additional sources which we hope to find in the remaining years before we apply for the federal new start funding formally. in the order of half to a billion dollars. the next slide will share what the ideas for those may be. immediately in fact we have an opportunity to provide some input to congress in the congressional delegate and statewide senators to see if we might be able to obtain funds from the infrastructure bill congress is taking up since covid is signed. that will be our focus to support them on this ask for near term infrastructure bill funding. federal reauthorization will be tain up. those will be merged. we will be prepared to work on whatever package does advance in the congress over the spring and summer. locally, we are forecasting and re-confirming through the existing sources the city sources on the project tax increasement as well as looking at potential future revenues such as the study we are undertaking. that is a potential source for this project. the joint development opportunities as well as private concession opportunities to participate in the project is something that we will study as well. regionally i mentioned these earlier. we will continue working through this to hope to bring it back to you in a couple of months for a formal update. here is our schedule. it is sort of a busy slide. the orange line tracks with the federal transit administration process to request entry to project development this fall. this is something jessie taylor reported last month to you all. the idea would be to request entry to the engineering phase-in february of 23 to prepare full funding grant to the fta by august of 2023. that would set up an agreement funding agreement by spring of 2025. along the way we are rapidly trying to prepare the project fixed component utilities and things needed right-of-way, advance design so we can position them for earlier funding opportunities such as federal ones i just mentioned underway this summer. if we are successful the construction could be sooner. the interim project director can speak to that. what is here is what this may look like if we go and you should choose to direct us to move toward this more accelerated schedule for august 20-23 submittal. the work plan shows that funding date the middle of august 2024. as we discussed last month hoping to accelerate efforts by a year. the advance planning in the current phase will be covered by the ta funding we have just added to our board. that is the project team through the calendar year. there after for the next phase of project development we are needing to assemble $25 million through the process and design phase-in particular. you can see what the project budget requires for engineering and implementation. turning to our planning and early design work. last month we mentioned the league 21 announcements about future planning and vision and that was the opportunity to brief the tjpacac. this is one of the slides we want to bring forward for your information. a lot of interest in the slide when we went to the cac. this is the future connections from the train box eastward across the bay as part of the future connection link 21. there are many conceptiontual options studied last summer and they are legend. three here are the ones you see in red abpurple and blue. these are potential alignments. each has pros and cons. there was work on the horizontal al alignment. red is the one that has the path that is most intuitive but has impacts for some buildings in yellow. it would then kind of go east from there. the other two go southward. the purple and blue are going southward and eastward down to sphere and beal, but one hads the radius high speed rail requires. it is on the statewide system. the other one shows tighter turn that can potentially avoid right-of-way impacts. this is an early indication of the options. the other options bend backward along the original line up and then head eastward from there. that is like a stub-in operation. we will continue to work on these and take your guidance on that work. here i invite the interim project director to cover the next few scheduled slides and we will be happy to answer questions. >> good morning, directors. thank you, chair gee. at our last board meeting you asked me to come back to the board with information whether or not we were on schedule. i am happy to report we are. this slide and the next slide contains all of the deliverables on the currently authorized work paprogram -- work programming. there is quite a bit we have done as you can see. i then keyed to show what is on schedule in green. completed in bold. i also wanted to include in the last column whether or not the items were on the critical path. for those in the public that might be listening. those are activities where if they are late they can impact the overall schedule. other activities not on the critical path can move in the schedule to some degree without impacting the schedule. sometimes we dual allow -- we wo then allow those to move. starting in june we have been crossing off all of the deliverables we committed to do over the course of the notice to proceed, one, initial allocation from s.f.c.t.a. we go to the second slide and look a little more to the future. you can see that as you start to look in the center of the slide with our operations analysis, preliminary results that are driving an important part of the phasing plan, that work was completed a bit ahead of schedule. we planned for march and got the information from the operators in january allowing us to proceed with driving towards completion of our next phasing workshop with the integrated program management team in april. that is third from the bottom. we are very much on schedule to do that, completing the business case as well, which is an important companion to the phasing plan. finally, of course, the phasing plan and results and recommendations that we will bring to the itmt in june to the executive steering committee in june and tjpa board of directors in august. that is all on schedule that we had originally set for ourselves back at the last june in order to complete the phasing study in august. i will turn it back to chair gee. susan chang. >> next slide, please. i think that was the last slide. >> you have the look ahead. >> the look ahead here is what you can expect us to bring in the coming year for information and action. this is consistent within the tjpa application for the funds pending final approval. we have accelerated master schedule coming in april. this would be subject to your continued guidance to pursue this accelerated schedule in may the phase-in study work. continuing focus on the risk register. what is exciting our new rebranding we will have outreach and update in june for the project. capital funding plan is where we get to update all of those resumes i mentioned. in july we will come to you for information and ultimately for action in august. of course, that is when we take up the phasing plan recommendations. that is a critical decision for the project to find what that is and companion piece is the business case that lays out benefits, costs and trade-offs for each of the options that were examined in the phasing plan. once we have that decision we can then execute more directly abfocus efforts in terms of funding and f t amend application for funding for the federal government. project delivery study we are getting going with tjpa. all agencies will look at the ways to procure the project such as design build, progressive design build, construction manager, general contractor or public private partnership. we are happy to answer questions. >> director chang, thank you for the update. i think those last several slides were a lot easier to understand for more people as well as the look ahead for the board. those are great way to present the information rather than a schedule with a bunch of colors and lines. good move. thank you for that. directors, any questions? i don't see any hands raised. any hands waiving? >> i don't see any hands waving or raised. >> we have a public comment, at least one. >> please let in the first caller. >> thank you, directors for your information. there is no way for me to know if my hand is up. i apologize for the earlier mishap. some of you may know, i mailed the sfta board of directors on january 25. i raised significant issues for the aspects of the project. received a response dated february 24th, less than 12 hours before last tuesday's board meeting. i will reply over the weekend. tjpa staff has plenty of time to respond to my response for $6.2 million prop k aplocations. i want to give you a heads up on my response. i will be discussing 21 slides extensively. specifically that if you look at the slide for memories there are six slides. only two of the six strikes make it out of the center. i will be pleased to show you how that was addressed. it is a direct result and that is the problem. good news side i am pleased to report on the building on the direct route which is the route in red in the slide where there is approximately 18 months ago and i am pleased to report we don't have to take a single building down. thank you. >> thank you. any other comments? >> that concludes public comment. >> directors, any final comments on this report? >> one quick question. as bart is linked to the 21 project. the region is interested in linking the downtown extension with a transbay project. what i wonder is if the studies that we are doing are looking at the opportunities for synergies there. specifically to what degree would we be able to save costs on the downtown extension if the transbay terminal were through a running station versus terminal station? without having to change the environmental documents, can we save money or introduce -- it creates interesting opportunities. i want to make sure that is addressed. >> thank you so much for the question. i will turn it to the interim project director. those are both covered in the study goes to a degree. >> thank you. >> director, we are in fact as part of our phase-in study operations analysis looking at the effect of a through running station on the infrastructure required to support the dtx under both scenarios. stub end is the current plan and through running if bart and capital corridors select that and it is constructed. the major question i suppose is whether under through running scenario we need a full three track connection between fourth and town send and the throat itself. that is part of the operational analysis that is being conducted, and we will speak to that in our phase-in report. >> thank you. >> any other questions from directors? not seeing any. >> there is a member of the public raised their hand. allow that person to provide comment. >> sure. >> can you please let in the caller. >> please state your name. your two minutes begins now. >> this is jim patrick from patrick and company. i want to direct your attention to the comments made. is there a through station or terminal station? those are strategic stations to do with the routing. i call your attention to the letter which submitted and came back from the cta board that said thank you very much. we have already sent environmental impact report. thank you. good-bye. it was wrong. i thought these ideas now is the time to evaluate these ideas, not based on good design. we have spent money on it. you are not going to design it again for 100 years. i think it needs rethought some more. i direct your attention to what he has to say. thank you. >> thank you. >> if i might clarify the caller referred to a response. this is a letter the staff prepared. we transmitted that to him from the ta on behalf of the tjpa. >> thank you. any other comments from directors? director chang? thank you for the update. good report. it was easy to understand for most people. that is great. that is the most important part. we need to understand where we are going, where we have been and the work plan is on schedule. congratulations. a lot of work being done in a short amount of time. thank you. unless there is anything else for the board. that concludes the businesses for today. the gift of free time. i am happy to give the gift of free time today. thank you to the public and staff. we will see you at the next meeting in april. >> thank you. >> thank you, madam secretary. roll call, please. >> clerk: thank you. we have a quorum. >> [all talking at once]. >> chair: at this time -- at this time i will entertain a motion whether to disclose discussions held in closed session on administrative code section 5712 (a). it has been moved and seconded that we do not disclose items held in closed session. madam secretary, please open the phone line to public comment. >> members who wish to provide public comment should call 415-655-0001 access code 187 976 7075. there are no callers on the line. >> chair: roll call, please. [ roll call ]]. >> clerk: we have five ayes. the motion passes. >> chair: thank you, madam secretary. next item. >> clerk: item 4, general public comment. >> madam president, we received one e-mail comment from the public. it was from john stanton, a 46-year member of the retirement system. you will be able to read his comments in the file. [indiscernible]. >> clerk: moderator, do we have any callers on the line? >> operator: madam secretary, there are no callers on the line. >> clerk: thank you. hearing no calls, public comment is now closed. >> chair: next item, please. >> clerk: item number 5, action item, 2020 review of economic assumptions: discount rate. this item was continued from the february 10, 2021, retirement board meeting. >> chair: thank you, madam secretary. this item will be continued until the april 14, 2021, board meeting. madam secretary, please call the next item, please. >> clerk: thank you. item 6, action item. approval of the minutes of the february 10, 2021, meeting. >> i move adoption of the minutes. >> thank you, commissioner. >> second. >> clerk: it has been moved and seconded that we adopt the minutes from the previous board meeting. madam secretary, please open the lines for public comment, please. >> clerk: a reminder to press star 3 to be added to the queue. moderator, are there any callers on the line? >> operator: madam secretary, there are no caller it is on the line. >> clerk: thank you. hearing no calls, public comment is closed. >> chair: thank you, madam secretary. roll call vote, please. [ roll call ]. >> you didn't call me. i'm in and out. >> clerk: we have six ayes. the motion passes. >> clerk: thank you, madam secretary. that passes. next item, please. >> clerk: item 7, action item consent calendar. >> chair: approval for the consent calendar? commissioners, are you there? >> yeah, i'll move the consent calendar. >> chair: thank you, commissioner. >> second. >> chair: it was moved and seconded that we approve the consent calendar. madam secretary, please open the phone lines for public comment. >> clerk: thank you. callers, if you have not already done so, press star 3 to be added to the queue. moderator, are there any callers on the line? >> operator: madam secretary, there are no callers on the line. >> chair: thank you, madam secretary. roll call vote. [ roll call ] >> clerk: we have six ayes. motion passes. >> chair: next item, please. >> clerk: item 8, discussion item. report on investment performance of the retirement fund for the quarter ended december 31, 2020. >> thank you, president. allen martin will deliver the quarterly report with a couple of comments at the end. >> can everybody hear me? >> yes. >> do you have before you the quarterly performance analysis for periods ending 12/31/2020? since then u.s. equities are up an additional 4.5%. you'll see through the end of february, the spers plan is up an additional 2.21%, which would bring your 2021 fiscal year to date a healthy 19.6%, almost 20% through the end of february. given the presence of the present stimulus package, i don't see anything in the current environment that would threaten the outlook for the assets. this is a continuation of what we've seen. i'm not going to go through the developments. g.d.p. continued to gain, although the year over year growth in g.d.p. was negative in the u.s. and the rest of the world. there is little sign of inflation. long rates, meaning the 10-year treasury are up 20 basis points in the quarter and since then have come up higher. we don't see anything overly threatening. the number one concern we have strategically is whether the economy turns into an inflationary environment or not. it was mentioned by bill with rates as low as they are, should we see increases or inflation, equities will be less attractive. s & p valuations started the quarter high and moved higher. we see high valuation lels. as we look long term, you have the irony looking back, the s & ps were high. you'll see the returns for the various capital markets by the quarter year and longer period. if you look at that first quarterly column of quarterly returns, you can't find a negative number. everything was up. the s & p was up 12% in the quarter. small stocks were up 30%. the core bonds did languish in the face of rising rates. real estate was the one asset class that you'll see in the one year -- in the quarter and in the one year springs up a little bit. if you look at the one-year numbers you see basically the same results held for the year. the s & p was up 4.4%. the emerging markets up 18%. bonds, because rates declined over the years 6 and 7%. we don't expect that to continue. with the s & p up 18.4, you have a strong tailwind. it should be noted that the rally in u.s. equities was very uneven. there is a page later in the book that takes the five largest stocks on the market, facebook and others, those five stocks were up 65% in the year, meaning the rest of the s & p, the other 4500 names were only up 5%. san francisco has a concentration in technology and healthcare. and in an environment of a very wide dispersion of sectors this creates an environment where active management does better. your portfolio in terms of equity results was quite good in this period. if we skip to page 12, go right to the punch line for san francisco results. the top line just to remind everybody is the time-weighted net of return and the ranking in a peer group of funds for assets greater than a billion for periods ending 12/31. you'll see the results for longer periods on the next page. we didn't want to give you eye strain putting them on the same page. the most important comparison is those top-line results at 7.4%, your assumed rate. in march only the 10-year return exceeded 7.4% with the strong markets returns sense then, all your results greater than one year are significantly higher than the long-term assumed rate. you would see that if you went to the next page. fiscal year 2021 is up 16.2% and as i mentioned that number is closer to 20%. the second line is the performance of espers policy index which assumes the actual allocation at policy weights and each asset class performing at the policy benchmark. so the differences between that top line and the second line are the value-added either through portfolio positioning versus targeting levels and/or manager value add. you'll see for all periods up to 15 years that number is positive. and for the five, three, and one-year periods it's gone from 1% to 2% to 3%. this has been a difficult market for anybody to outperform policy by 1 to 2% and last year you were 3% over policy. it's strong, as reflected in the total return rankings versus peers, as you see in the top line, particularly the longer periods, top 5%, 6%, 8% for three, five and ten years. since you are a diversified allocation, in a run-away up equity market like q4, you'll trail your peer groups because they are more influenzaed by the run-up equity prices. if you go down to the third and fourth lines, you see a performance of a 60-40 global index fund and you see the 10% real estate composite. if you look at the five-year numbers, you've outperformed by 1.5% roughly in both of those categories. if we converted that to dollars versus a 60-30-10 global index portfolio, you outperformed by slightly over $2.3 billion. so by having a well diversified portfolio in the way that you've invested and chosen to invest, you've added that money to what you would have earned had you just had an index result. you've chosen to diversify away from public markets modestly to reduce the risk of large draw downs and to expose the portfolio to the more consistent alpha opportunity available in private markets. the tables in the lower right document that your actual results have indeed been less volatile than your peers. that standard deviation is your portfolio for a three and five-year period versus your peer group. you are the least volatile funds in the peer group. when you combine strong performance with low risk, the commonly accepted measure of risk-adjusted return is the sharp ratio. that's the return minus the risk-free rate which in this period has been virtually 0 and dividing by standard deviation. in that measure, you're in the top 1% of your peer group. the sortina ratio is a slightly tougher ratio in that it ignores upside periods, but the denominator is taken in down markets. this is a san francisco state professor frank sortina, and in that you rank in the top 1% of your peers. as of 12-2020-2021, you had a dollar gain of $3.96 billion over the year. you'll see in a minute that more than offset the $582 million you paid out in net benefit payments. that's the top line. we're going to sten -- spend a little bit time on the risk return. any questions on the top line? >> i want to make a comment but i'll wait until later. >> over 30 years while the universe gets skimpy, top percentile performance. page 14 is the compliance page. column 3 is the 12-13-2020 percentage allocation to each class -- column 2 is the interim policy targets. you would note all of your allocations were in the range approved by the board and fairly close to the long-term targets. treasuries were underweight as of 3% by that time and private credit was 5% below. these numbers had to add to 100 so you had more cash than private target. if you look to the right versus interim policy, you're close to policy. in the interest of time, i would skip you to page 16 and point out as a mature plan, you pay out roughly $550 million a year in net benefits. that will grow over time. you are a mature plan and you have a plan, in fact, to accommodate that. having said that, you will see over these periods returns have comfortably exceeded that. you have earned those returns because of being more diversified and exposed to private markets which are less liquid. but if you were to divide that into $550 million at the end of this asset period, you would get 1.8%. that is below the median and supports your ability to take liquidity risks in order to achieve returns over time. all of the risk charts are similar. i would suggest we go to 18 and talk about five years. if anyone wants to talk about other times, we can. there is a standard deviation from low to high variability. every one of those black dots is public funds mapped with their risk and return. you are the green square. you've taken less risk than 80 of that member peer group. if you measure horizontally for that group, you see you're substantially above and once again there may have been eight or 10 funds, all of which took more risk than you did to achieve their results. the black diamond is the policy result. so the green square didn't just follow policy, it did so by mitigating risk in the portfolio. you don't always see that. that is a highly desirable result. that's what i was going to say about risk and return. if there are no questions about it, the one thing i would comment is all of the results we've looked at here are ended 12-31-2020. when you do that, you get end period bias, meaning your most recent period will be unbiased things. if you turn to page 24, you'll see how you perform all of the fiscal years complete from 2016 to 2020. i will tell you, it is usually the case if you have a plan to outperform in up markets, you generally underperform in down markets. you can see from this chart, one, that your five-year result and, in fact, two of the five years are well above that 7.4%. but even in the down markets of 2016 and 2020, you still were in the top quartile group which you achieved in the top market. that's very hard to do. if you turn to page 25, this is a plot of each quarter's performance of your actual portfolio versus the performance of your policy. you'll observe it bounces around a lot, but indeed if you took the blue line which is the moving five-year performance, you'll see that roughly starting in the third quarter of 2016, that line has been moving up steadily. there is consistent outperformance versus policy. it doesn't work in the second quarter, where that wasn't the case. by and large, the progression here is quite strong and definitely upward. we've said there are two factors that contribute or detract from that performance. most importantly, did the managers in the asset classes do better in their policy benchmark? that is detailed in the policy periods. i would go to page 28 where we look at five years. you see the excess return of 1.04%. you remember from the chart we started with was 10% actual versus 9.9% policy. what this page does is to decompose how much of that was from positioning or allocation and how much was by selection by asset class. the selection piece -- the allocation piece is small. it's 11 basis points. that means when you look at all the over and underweights in this period, there was a slight overweight for those who did well and those that didn't. most of it was opportunistic equity, being underweight return. that's what you want to see, a small, positive number. if that was large, you would be operating away from board targets, meaning a lack of focus or taking a risk in potsinging the portfolio known as market timing which is generally hard to do. the manager selection effect is almost 1%, 93 basis points, 0.93%, after fees. you'll look down the list and see how consistent that is across asset classes. again, you don't want to see that. you did very well in one asset class and poorly in another. the only two asset classes that underperformed their benchmark were absolute return and equity. we had a difficult march. it's taken time to recover. the benchmark for that asset class is a spread of challenging objectives with disappointing performance in the interim. private equity is the other one. private equity is public market plus three. over this period on a time-weighted basis, you generated 16.2% per annum. that's extraordinarily good. cambridge reports on this in better detail using different metrics. on a u.s. equity performance, you outperformed. this is not due to a program that isn't doing well. it's been an extraordinary period and that benchmark is challenging. any questions on this top line? page 29 has your total fund overlay unleveraged. and there is no leverage in your portfolio. the next is the total fund of the overlay. you may recall in may of 2018 we elected to quote equityized cash. by employing an overlay manager, you can take that cash, buy futures, and earn equity or equity-like returns. over time, that should rebound to the benefit of the portfolio. you started that in may of 2018. you -- when you run an overlay as in february and march, you get march calls where you need to pledge additional catch for the overlay. march was a little bit scary. the staff turned off the overlay in march and reinitiated it in march. since march, that has been invested in a treasury overlay rather than an equity overlay. if you were to compare those two lines, you would see a modest performance given the overlay versus without. that is really due to the circumstances i mentioned. over time you would expect that fund to do better. i wanted to make sure everyone was okay with that. to look at how we've done with respect to each asset class and i can close with two pages and take questions. if you go to page 39, these are risk statistics for each asset class for a five-year period. it is a busy page, but to the left is the annualized return and then below that the benchmark and the ranking. public equity, top percentile. developed markets more median. that's just the returns. if you move to the right and calculate the volatility, how different was your return versus the benchmark. you get a risk-adjusted measure appropriate to an asset class. you can see when you look at that information ratio and you're ranking again on a risk-adjusted basis, develop markets did not do as well. if you go to page 40, you see the same results of the public pieces of the portfolio. emerging markets down a little bit at the 49%. again, quite, quite strong numbers. lastly, if you go to page 41, you'll see the results for private credit, top percentile. your private credit program off to a good start. i mentioned private equity at 16.2% for the five years. we've covered a lot. i can take you through some of the individual results. i don't see areas of significant disappointment that need correction. not everything is the top percentile, but bill would like to highlight some of the results. i'll take questions and turn it back to bill. there is a lot of good in here. >> thank you. we appreciate you providing us with a comprehensive report. are there any questions for our consultant? >> i have a question. the question is the times are so low, do you have a target for duration that you maintain? i'm trying to understand what we keep the duration at. >> it would be on the low side. we don't have a target. most of our exposure to bonds is in high quality. we're not seeking high duration, low duration. that would be favorable if interest rates were high and expected to decline. that's a duration close to 6. >> we've just gone through the annual reforecast leading to generic advice to clients. one of the strong advice we've given to clients is to barbell your fixed strategy and have a lot in treasuries and in private debt and minimize the stuff in the middle. you've been doing that for quite a while. you have only 5% left in this intermediate. this is something you've been working on for longer. >> [indiscernible] -- the program has to do with page 31 and the private credit. in our private credit, how much of the coupons there are any kind of a variable versus a fixed rate. >> the vast majority of what we have are flowing. that's part of the concept of [indiscernible]. >> this yield is around 5? >> it's a little bit higher than that, the actual yield. >> [indiscernible] -- are getting substantially higher [indiscernible] -- now, in terms of that 5%, [indiscernible] back to us. >> you were pointing out the numbers being so low. thanks for focusing on that. i don't think we will be hurt by big changes in the interest, but the point i'm trying to make has to do with the alpha. we're patting ourselves on the back for having in our peer groups, but that alpha, that i'm trying to save us for the benefit of anyone listening like those from the mayor's office, the alpha comes from our staff's hard work and smarts. that's why we arguably one or two more of them. that's how we get to the 7.4, not just a great information ratio. i was wondering how much risk we're enduring, but we're a-okay. i did all those questions to get to that point. thank you. >> [indiscernible] -- >> i just have a comment. i think we need some of the microphones in the office turned off so we can not get the feedback. we talked about the budget and various things. i was very interested when i saw the article about ben rosenthal in the chronicle regarding the budget and the improvements to the budget and where things are. i think we should all keep in mind that when we discuss budgets, there are a lot of moving targets. and a lot of uncertainty until such time as it's finally closed. so i have some hopes that we -- yesterday's article indicates there are a lot of federal funds coming into the city. the two-year budget is going to be impacted very positively. there is also the recovery of the tourist trade and the convention busy is indicating what happens two or three years down the line, the real estate market and factors. all of these are moving targets. we should be cognizant it's always a moving target. because the world is a moving target, i guess, allen, would it be fair to say that our investment staff does very well moving with the targets to stay current and on top of things ahead of the curve. would that be a fair statement? >> a very fair statement. they say you skate where the puck will be, not where it's been. you are very much oriented, as i tried to describe earlier, positioned for a more difficult time in the future. this is value add. the markets themselves have been constructed, but you've added a high percentage on top of that. >> thank you very much and my complements to the staff for doing that. that's my comments. >> if there's any other comment, if not we'll go back to you. >> board members, on page 12 there is actually a good highlight to the commissioner's comment. if we look at the policy index and whether the policy index is above or below 50% in terms of its rank, that policy index is the asset allocation decision as a result of staff and sclunlts' recommendation and the board's approval on asset allocation as compared to our public planned peers. the difference in terms of our peers, the top line -- excuse me, the volatility of our returns, that ranking, that is a decision -- the recommendation that staff and some have had with regard to the manager selection, as opposed to asset allocation. you can see that our asset allocation is not in the aggregate, line item by line item it's quite different. but in the aggregate our asset allocation slightly reduces our risk relative to our peers. our volatilely is in the 40th and 50th percentile. this is driving our risk learned friend adjusted returns high and the volatilely low. we also say looking at the one, three, or five-year returns is that our one-year returns at 6.66% and the policy return is 10.66% and the median plan is 7.66%. the difference between the policy index and our actual returns is the results of manager selection. you could say how much we differ in terms of our actual asset allocation compared to our board approved allocation. allen pointed out that the difference between those two is de minimus. the driver of our returns is proving to be driver selection. if we go to the line item titled public equity with overlay unlevered and we look at our one-year return in public equity of 28.9 is the policy return of 16.25. we outperform by over 12.5%. we outperformed our median peer by almost 12.5%. that's because we hit six home runs in a single year. the six home runs were our decisions to overweight tech, healthcare, and china. you could say eight home runs. manager selection in all four of those, if we were to go into the detail were extraordinary. our other managers are outperforming by 10. our tech managers also by more than that. we've really hit eight home runs in a single year. it's really extraordinary. another example if we turn to pages 33 through 39, in public equity you'll see what allen referred to there as the information ratio. that is the amount of active return divided by the amount of your active risk. active mean your return in risk versus the benchmark return in risk. here we have an information ratio of 5.55 for one year. that will never happen again. that is because we hit a home run in a single year. to give you an idea of what is an excellent tracking error, at line 39, our tracking error is 1.43. 1 is excellent. 0.45 is quite good. lastly, i'll point at pages 55 through 57. on page 55, allen has summarized what are returns in terms of selection, that's manager selection, and asset allocation. this compared to our policy, not to median peer. two-thirds of this was generated through manager selection. if we were to adjust this relative to our median peer, that call-in title selection would be more significant. here's why. you look at private equity and the selection effect is negative 76 basis points. that's because what this page is doing is comparing your private equity manager returns versus the policy index for private equity, which is the equity market plus 300 basis points. if we were to adjust this relative to the cambridge universe, that would be decidedly positive. if we were to adjust this number compared to median peers, this number would come materially down. if we were to -- last page, last comment, i promise. we were also to add 56 and 57. you see here the selection effect is driving about 90% of our access returns. the vast majority of our returns are driven by manager selection. what is manager selection? it's labor intenser, research intenser, it's resource intensive. that's what's i mean by that. with that, i'll turn over to the board for questions and comments. i hope that was helpful. >> chair: that was helpful. board members, are there any comments, questions, concerns? if not, i would like to thank the staff for their comments. i turn it back to you for any other comments. >> [indiscernible]. >> i would like to thank you and mr. martin. thank you. madam secretary, next item, please. [please stand by] . . . . bonds for the month were down and our bond portfolio was down 96 basis points that compared to barclay's. and it continues to be a strong market in public and private equity. in public equity a broadening market. initially a narrow tech and life science rally through most of last year. it began to become much more broad to include small stocks, international stocks, emerging markets. and that and energy has been doing well and continued through the end of february. in addition to all that, we have also had a strong recovery and private credit which was up 2.38% for the month, particularly strong return for a single month for a credit book. the one part of the lag is in terms of recovery of real assets. we expected that. i expect there will be better news ahead. and as travel returning more to normal. hotel bookings and airfare and things like that. and energy prices stabilize as demand stabilizes. i will give