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tv   Government Access Programming  SFGTV  May 12, 2019 3:00pm-4:00pm PDT

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about 15 to 20 assemblies per year in the schools to educate the kids. we do feel like the children can have an influence on the parents, but also, as they grow older, they will take the responsibility. don't be a litterbug was a comment, but we are looking for the right slogan. we do recognize you can't continue to expand our budget, because that is not the solution. the solution is everybody taking a personal responsibility and having some civic pride for san francisco. >> supervisor fewer: absolutely. and i was going to suggest that we partner with the san francisco public schools because i do think 60,000 public school children can have an impact on their families and
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also the future of san francisco's cleanliness. i also know my district has started an initiative ourselves. and i'm just wondering when you're starting this marketing campaign, do you have an idea of what type of resources, m y meaning money, that you will need to do this marketing campaign. >> as of yet, no. >> supervisor fewer: okay. >> we have a general sense and what we feel a snapshot outline. we're waiting for feedback from the scrubbing of the actual campaign slogans. >> supervisor fewer: is anybody else -- colleagues from anybody else? okay. let's go onto our next category. li lisa pagan from the office of economic and workforce
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development. >> hello. good afternoon, chair fewer and committee members.
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my name is lisa pagan with the office of economic and workforce development and thank you so much for having us here today to talk about economic and workforce services, my absolute favorite topic. i also wanted to say thank you for having us this week. the office is hosting a series of events this week, which i wanted to let the folks at sfgov know. more information is available at so today, i want to talk about small businesses which are the backbone of our town, heart of our neighborhoods. 95% of all of our registered businesses are small businesses. and at oewd and our sister
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agencies, home-sf and the other small businesses, we look at the neighborhoods that they're operating out of. one of the things that i wanted to explain was our objectives. we're talking about strengthening businesses within neighborhoods but also strengthen relationships across all sectors? and we're talking about fortifying neighborhoods and their culture. we also look at improving physical conditions of neighborhoods as part of our neighborhood based business services. so to go into more about neighborhood services that we have, we're talking about commercial planning, management, and business support. so we've done strategies in
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partnership with neighborhoods and many city departments and yourselves to figure out what are the priorities for those neighborhood commercial districts and then we work on implementing those priorities. we work on cultural district formation, and we do community benefit district formation, and all of those different types of efforts help bring stakeholders together to define priorities for their neighborhoods and implement them. our community and merchant capacity and building support is for merchant associations who need help in those areas, and then, we do sidewalk help for those merchants, as well. and then, we have neighborhood wide campaigns as well as
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special events. our small business services that are focused on individual businesses have a variety of areas that they're looking at. one priority area is business attraction and retention. our storefront vacancy, we completed a study and now we're implementing ideas in that study. we're targeting areas that have high vacancy rates, and we're also looking at administrative and policy reforms in terms of being able to -- excuse me, i got ahead of myself. policy administrative reforms in order to help businesses
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reduce costs, help businesses get permits earlier and stay in san francisco. we do business license assistance, real estate and leasing services, technical assistance to businesses. if facade and tenant improvements. we do outreach and referral services, we have job squads, we do disaster relief programs helping small businesses with grants and technical assistance in the case of fires, for example. we have a construction mitigation programs which is really looking at businesses going through construction on major infrastructure and we have programs to help businesses comply with a.d.a. accessibility. and our legacy business program -- as you know, the
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office of small business manages -- which has a grant program and also a registry component. so back to the individual businesses. in addition to business he traction and retention, we look at financial assistance. so we have loan programs, we have credit building and repair programs. we also do business development programs and that's a very wide range across our entire department and sister departments. so we provide direct business assistance, which is counseling. we have the small business development center, we have the office of small business, small business work that they're doing every day, helping businesses start. we have business sector programs where we are looking at a variety of sectors in the economic, such as healthy retail, we look at convenience
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stores and liquor stores and how to widen their array of services. we help restaurants, and restaurants open. we're looking at other sectors of the economy in that area. child care businesses, food based microentrepreneurs, night life entertainment, manufacturing and p.d.r., incui incubation, lease services, they have a section that supports film makers, and we do pla employment services, as well, for our businesses. we provide free employment services to businesses for employee recruitment, for training, and for placement. we connect businesses seeking employees with a pool of
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qualified talented residents. and we also do layoff aversion and placement services for employees facing layoff. we've helped three small businesses this year to date with 109 -- three small businesses, i should say, with 109 employees. they were provided with layoff aversion and outplacement services to help them get training or other services. in total, we've helped 109 employees. we have different divisions and teams and departments working with us together to provide these support services. the neighborhood commercial services represent 53% of the budget.
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the financial assistance services represent 6% of our small business services budget. business attraction and retention services are 25%, and business development, which is sort of that targeted technical assistance and sector work and workforce assistance is 16%. so you can see the total amount that we spend, this excludes staff. this is not excluding staff numbers. these are, like, contracts and grants that we have with service providers, and this is $14.4 million, and it showed you the breakdown. 86% is provided through grants and contracts with neighborhoods, but our sector teams are also available for large and medium businesses, so there's definitely grants going
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out to businesses and contracts for services. workforce serves all size of businesses, but they also service the small businesses with the assistance. and office of small business is exclusively serving small business. and the film office also serves small film and advertising production. so our target populations, we -- we touch every aspect of our diverse economy, but we also have priorities in certain neighborhoods, areas that have high percentages of poverty, crime, people of color, immigrant communities, as well as areas that have not been historically invested in as other parts of the city either through market forces, you
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know, the market economy not investing in those areas as much or in the past not as much focusing on infrastructure or other types of relevance in the human realm. we employ a framework centered on equity, humanity, and inconcludii inclusion. and then, our cdbg grant program, we actually collect demographics of the business proprietors that we support through our business services and 17% of our business services are cdbg funded? and through that funding, 23% of businesses i'd -- sorry. 23 percent is of business proprietors are cdbg.
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these are the business proprietors of the services that cdbg is funding, their racial composition. and the office of small business center, 85% of their clients received customized case management were clients of color. so we do have some data that we collect, but some of our programs are not collecting date, which leads me to our next slide. we collect metrics from all of our service providers on our programs. we're actually in the process of deepening our service m metrics so we can provide that information to you. where he partnering with internal and strernl partners
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-- external partners. we want to deepen relationships next year to really go into our program metrics. currently, we have a small business needs assessment underway and part of that assessment is going to look at the metrics that we've collected so far, and that report is to be done in september, so we'll be able to have much more concrete information from that assessment. we're also about to finish a neighborhood impact report on several neighborhoods where we do our neighborhood services, so that will really help us convey, like, what has been more of the services impact to date and what we should change in the future. we're also in a process of working, and a lot of our staff are getting trained in tools to address racial equity in our programming and also apply that in our metric performance
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formulation. so expect our enhances metrics next -- enhanced metrics as we're in the process of that right now, but we do collect all of them to date. we just want to improve that. with that, i have more questions as well as program staff in case you have more questions than this high-level overview. >> chair fewer: thank you, miss pagan. >> thank you. i hope i kept it ten minutes. >> chair fewer: thank you for your thorough presentation. any questions or comments from colleagues? seeing none, i have a couple. i wanted to know, do you work at all with the department of public health. what i'm hearing from some of the small businesses in my neighborhood is they're not meeting the measures for the department of public health and therefore some of them have been shutdown, so i'm just
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wondering do you work closely with them at all to mediate these issues? >> yes. >> chair fewer: and what is the -- how many f.t.e.s do you have in your department? >> i'm going to ask our c.e.o. to answer that. >> chair fewer: oh, hi. how are you. good to see you again. >> we have approximately 120 f.t.e.s. >> chair fewer: you have 120 f.t.e.s. and i wanted to know what is the language capacity in your department? >> i don't have the exact number. >> chair fewer: there controller, do you? oh, i just thought you had that information. just stretching. so you do have language capacity? >> that's correct. >> chair fewer: but right now,
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you can't tell me how many languages you cover and how many of your employees have language capacity? >> not an exact number. >> chair fewer: so that would be super helpful, quite frankly. and then, i wanted to know, do you have any numbers right now -- i know that you're doing some extensive measurements and everything, but do you have any numbers that you can share with us today about the racial ownership and diversity of small business ownership in san francisco? >> apparently the city does not track that information. we do have some information from the office of small business related to their clients that were served, but in terms of total san francisco businesses, no, that's something that is investigated -- >> chair fewer: actually, i
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think this is important data to add to the measurements that you are collecting in your report because i think it's important to find out what our small business ownership really looks like and how diverse they are. so i know you're gathering information now. i'm just saying they're really an important point to -- so that we can sort of analyze who are these small business owners that are in san francisco and are we offering an equity tabl amount of opportunity to them? do some communities need more help to be successful, such as they are not english proficient, and what is the types of services we need to embrace the level of racial diversity that i think we can all be proud of here in san francisco? it is just getting harder and harder to start a small businesses. and i know that many of the small businesses in my neighborhood have gone under, so i'm wondering what type of
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assistance is available to them. and also, do you do any work in the chamber of commerce in san francisco? because when i spoke to the chamber before, they said they have no relationships with the smaller chambers, like the african american chamber of commerce or the chinese chamber of commerce. i'm just wondering how this is supporting all small businesses within the chamber of commerce. and another question to you, do you help within the structure with any of our merchant associations. >> that was part of our direct support with merchant associations directly. >> chair fewer: do you help them with emerging of a merchant association? do you help them to form one, with the infrastructure of one? >> absolutely.
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that's at the core of a lot of neighborhood work that we do, bring together stakeholders. they're often residents, property holders, and merchants, and sometimes they want to form a merchant association, and sometimes there is one. we look to the neighborhood to define what associations make the most sense to manage their district, and it could be one working together or it could be more of a coalition. but we don't prescribe it has to be merchants versus some other type of entity, but we do work on neighborhoods to man-- building their capacity to manage their district and to serve their residents. >> chair fewer: i think i would be remiss to say that i think the merchant associations actually could use more assistance? it's just because i think we're
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finding along our merchant corridors -- and you layout the small business support that you have, but we are seeing an increase in vacant storefronts and small businesses disappearing from our neighborhood, and i think every supervisor here can attest our small businesses really define who our neighborhoods are and our city, and we are desperate to keep them. i think the merchant associations, when they're right, they can be powerful associations, but they are very difficult to get off the ground and to get people involved. so i think they can use more assistance. and then i also just wanted to mention i am a great fan, i think people know, of the legacy business program. i think these people have served our neighborhoods and our businesses for over 30 years. i think this honor is part of keeping san francisco who we are. i have heard that the grants
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that are open to these recipients with people who have -- are people who have been awarded the grants on the registry, the amounts of the grants have been reduced. is that correct? >> i can answer that, but i'm going to defer it to regina. do you want to answer that, regina, or i can. it's up to you. >> yes. regina dick-andrizzi, office of small business. thank you, supervisor fewer. this year, the amount of the grants did go down? and the way the ballot grant was written into the measure, it is prorated per f.t.e.? so it's -- so it is based upon the amount we have, and then, the number of grants and the number of f.t.e.s. so if the f.t.e.s increase, and we have a set grant amount,
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then, that funding per f.t.e. goes down. i don't know if that makes sense. >> chair fewer: so i'm wondering, the total pot of money that we have to give out hasn't shrunk, it's just that there's a higher demand because of the f.t.e.s. >> well, higher demand because more businesses are being added to the registry. >> chair fewer: so do we have a cap on the number of registries that we would allow? >> no. >> chair fewer: no? i heard there are 300 slots. that's why. >> there are 300 slots per year. in terms of being nominated, not necessarily being added to the registry. so right now, we have 181 businesses on the registry. >> chair fewer: okay. so it seems as though the way it was designed is that we did
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not allocate enough money, would you agree? >> well, the first two years, we did allocate enough money. i think the grant program, i'm happy to have conversations with you to have a look at how that grant program is structured and both sort of current obligations and what the five-year, ten-year, 15, 20, 50-year obligation might be. and so it does require a -- >> chair fewer: yeah. actually, regina, i think that that would be a very forward thinking sort of prudent thing to do, as we start to try to preserve these gems in our own neighborhoods that i think we
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should be looking at a total amount of money that it would take to fully fund this program. if we're only able to partially fund the grants or not fund them as we intend them, i just think these businesses are more in need of the full funding. so i'd be happy to meet with you on that. let's make a note to meet with each other because i think we should fully -- you know, fully support them. i even thought that the grant was actually sort of minimal compared to how hard it was to keep businesses there and control the rent space, so let's work on that together. [please stand by]
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if we can get a break down on that. do we know the rate at which
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small businesses rv to close in san francisco? >> 95% of all registered businesses in san francisco are small businesses. 99,000 registered this month and 95% are small businesses. >> how many of those are brick and mortar in terms of vacancy and having to close and the reasons why as supervisor fewer mentioned so we can build on policy to help them. >> chair fewer: every year a certain number close for different reasons. they are doing a good job now cleaning the registration rules so we get a sense who closed that year so we can look at that number for you. in terms of the reasons why
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businesses are closing, retail studies on the website and it talks about the many various factors that are putting pressure on small businesses, especially retail storefront businesses, and it talks about a variety of issues that could be happening. that is important for our office to assess and come up with a game plan with solutions on the actual reasons. it is always this or that reason. if you look at retail studies there are multiple reasons why vacancies happen and intersections. we need to look at each one individually and make assessment and then deploy services. it is a priority we are deepening the exists staff and resources on because of everyone's concern, especially yours. >> president yee.
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>> supervisor yee: i >> supervisor yee: do you have a sense of the ones that made it into the pool of 181 or so, how many of those are closing or have closed? i get communication from legacy businesses, no not a lot, but yu know, constantly i am getting the message we have to close for a variety of reasons, do you have a sense? >> of the legacy businesses that have been put on the registry so we have 181 active, we have four that did close. since they came on to the registry. one of the other elements that we provide the legacy business program is business technical
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assistance so if a legacy business we do also have the rent stabilization grant. 29 businesses have been able to extend their lease up to 10 years because of the rent stabilization grant. that grant is really meeting the objectives of the intent of the program so with that we do have lease negotiations for small businesses, 29. we do have lease assistance negotiations so when the legacy businesses are negotiating their lease especially for smaller ones they are negotiating the best lease for them, and then we also work with the small business development center to provide business technical assistance in terms of marketing, promotion based upon the businesses needs to help them generate more revenue.
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>> basically of 181, i guess you are saying only four have closed. correct. >> are there any took reasons, the pasta place, for instance, are going to close. that is because mainly because i guess the business owner doesn't want to run it. >> i think to speak to that, right. businesses are close because every timer and if they are -- retirement and if they have somebody to take it over. one of the discussions the commission is having is really taking a look at programicly what to develop with the program is being able to -- the business transition when an owner wants to retire and can we cultivate
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and work with employees within that business? we have a partnership with democracy at work institute to also promote worker cooperatives, and as that is a transition model. i would say that is the next step fo for that program is worn success in planning. >> supervisor yee: it seems like the ratio of 181 to four is a good ratio to me. in terms of, in the past few years we talked about streamlining the pro sessto start a business. you didn't mention anything about that. has that been done and is it successful? people are still complaining about the process. related to that, there was the concept of developing the small
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business portal, i believe. is that active right now? >> the small business portal is active, some of the enhancement we created for the small business portal is not all permits is a business to apply online. that is continuing to develop. also, with the discussion of 49 south vanness, that discussion is enhancing. there are permits that businesses can apply with online. we developed a folder for businesses so as they are, say if you are wanting to open a restaurant that you can create your own folder and put in the folder all of the licenses and permits you need. you may not necessarily be ready to fill out a license but you have it in the folder to know what license you will need. the portal is there.
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and we have probably annually 25,000 unique users looking and pursuing through the business portal. other streamlining efforts are and i am going through a little history is that used to be the tax and treasure's office would send out annual licenses liver present times of year based upon departments and businesses requested that the tax and treasurer's office consolidate. that has happened. online business registration happened. the ability for a business to go into th the tax and treasure's accounts and look at the permits and licenses. businesses are happy about that.
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i think probably some of our challenges still ahead of us is the bureaucratic process when opening the business. >> supervisor yee: in regards to the portal itself, is that available to anybody other than english? >> yes, and the business portal was designed to -- it is available in english through, you know, clicking on the language. we were very careful in design of the portal in terms of simplifying the language concise so that when you did translate it, it translates correctly so that often words we might use may not transmit into another language. that went through user testing
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when the portal was lunched. >> supervisor yee: your answer is what? >> the answer is yes. >> supervisor yee: what languages did you have? >> we do use the google translate. >> supervisor yee: that is what you do? i am not understanding this. let's say i speak spanish and can't read english, what do i do? >> there is a box that says if you need to have the portal translated, read it in another language, then you are able to select your language. >> supervisor yee: you are saying you have tested it in terms of using the google translator and it doesn't translate tenderloin, for instance in a certain way? >> for thing like specific things like tenderloin, it will
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probably say tenderloin. in terms of the kiss ability ac-- disability access office of small business, some of the business terms common in english don't completely translate so when the portal was written it was very specifically written t ensure there were certain phrases that would translate correctly. yes, it did go through user testing through the predominant language is city required. >> supervisor yee: sometimes there are funny translations. you have a mechanism to actually let us know how many people are using it if they are spanish or
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chinese speaking? do you have those numbers? >> we don't have those numbers. i will talk to the technology division to see if we can capture that. >> supervisor yee: that is important. we can go under the assumption that it is translating. you might find out hardly anybody is using it. if that is the case, you have to somehow get the word out that it is available. i'm not too sure if people that are non-english speakers know it is available to them. you mentioned something about helping when businesses close down, you try to help the employees with their unemployment. explain how that happens. does the employer reach out to you or who talks to you? >> could you repeat the question. sorry i was talking to my neighbor here.
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>> supervisor yee: you mentioned, lisa, that you helped a few businesses that went under or closed down. you helped employees get employment somewhere. >> that is correct. to answer the specific question i want to take the opportunity to say one more think about business streamlining. right now we are engaging with the mayor and supervisors on storefront vacancynishsive. nish -- vacancy initiatives and we made administrative forms on things related to permit timeline. we have done that this past year. we are continuing to look at more processes that can be changed administratively with the departments with licenses and permits.
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we are looking at a package that some of you are sponsoring that we want to support you on and we are sponsoring with you. there streamlining continuing. we can talk about employment services. >> i am the business services work force site. we have the program called rapid response and layoff of aversion. every tame when a business comes out of business we get one or learn it from the media or from co-workers anywhere. we outreach to those businesses to help them transition. that painful period of time we help their employees. we bring our partners from att
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and cobra insurance and connect them with those businesses who are hiring payment so that he -- hiring at the same time. we connect them with our community organizations and community work force providers who help those employees to if they need something or just freshen up their interviewing skills or possible employment services. >> supervisor yee: i think i heard you say that the way you knew about it is that may be one of the employees reaches out to you? >> we receive notification. from basically businesses who are laying off more than 15 employees. they are obligated to let us know.
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many times do we receive it from those businesses but outreach based on our knowledge. if we hear from media or whatever. that is how we help them. >> it triggered something. there is a child care center that all of a sudden closed down and they probably have 20 to 25 employees. >> we know about it. >> supervisor yee: are you helping them? >> we are connected yes yes >> supervisor yee: who are you working with? >> it is my staff. normally it is a hr person that we outreach to. if you need specific information i can get it for you. >> supervisor yee: this is, i don't know if you keep track. this might be interesting for us to know.
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in terms of small businesses in the brick and mortar places, we know a lot of them are closing down and going out of business because of the vacancy. we see that. the rate of businesses closing is a little faster than businesses moving in. did you keep track of what types of businesses were actually closing that we get a sense of if we are going to encourage, you know, if your department is going to encourage a new type of business to come on. what do we encourage them to start? it seems like there is a pattern of certain businesses that are not successful any more and there are probably others more successful. >> wi can provide you with more
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detailed information. i just sent a presentation on that. the information is for the entire year. that is for the last six months. also we don't separate small businesses. we assist all kinds of businesses small, medium large. if we need to track it moving forward, maybe we should focus on that. >> we will probably see more small businesses closing than large businesses. a fair salon is probably not a large business? >> for the last six months there were three small businesses closing. like lisa mentioned before 190 employees. one is the hotel and two restaurants. mostly we observe restaurants.
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>> supervisor yee: i would love to see the data. >> like small stores. we have a variety of training programs. when we meet with the employees, we let them know all of the resources available to them so they can choose the next step for their career. if they want be to stay in the same field or change fields. >> supervisor yee: i know about the child care. i also know there is a shortage of early educators in the field. it seems like the logical thing would be to work with organizations and a few that know. >> it is like a billfold last week when we learn about it a few days ago. we started what we do because we
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have also staff who are outreaching the different employees for employer engagement. we call it layoff of aversion when they are trying to find the businesses hiring and connect with those businesses. >> supervisor yee: thank you very much. >> very quickly. first, i want to say how amazing it is to hear everyone talk about david's legacy business legislation. i think it was always around. regina remember when we were writing it and everyone thought we were crazy. it is a major part of san francisco. i agree with supervisor fewer we need to fund it adequately to make sure the grants are strong and to know 29 of 181 businesses got 10 year leases which is
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virtually impossible to get a 10 year lease in this city. it is wonderful news. i want to thank you for administering it and bringing it to life in such a wonderful kay. my second thing is a question. what i am hearing from businesses in my district is that their biggest problem is hiring. they can't find the employees to keep their businesses going. they are paying above minimum wage. it is so hard to survive in the city they can't get the work force that they need. is your office doing anything about that? it is a complicated prob leg. i'm curious if that is something you are hearing as well. >> latest unemployment numbers are below 3%.
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it is unprecedented since i have been working here for 14 or 15 years. we have that challenge. our work force programs are trying to deepen their ability in neighborhoods to get folks who are not working to engage back in the work force so that is a big part of our work is community and people based and looking where the pockets are to help connect our residents with all of the job opportunities and upward career mobility opportunities. >> i just want to add that through the constant contact we send out job announcements to more than 1600 people and we work closely with the community. we are partnering with 55 work
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force network system providers who serve the population and we are working can six neighborhood access points with six specialized access who also serve the community. whenever the employer let's us go they are looking for employees. we talk to them. we say will you take all this, put the job description and that is one of the areas. that is how we help. >> thank you. i want to recap that i asked for a couple data points. i want to clarify that, one, i wanted an analysis of small accident owners to track --
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small business owners and how many are bilingual and which languages. i have a note that supervisor yee and i have been working on work force development for seniors which could be a possibility for small businesses that they wanted more experienced people. thank you for your presentation. i will connect with you later. we have gone long. thank you for coming and working with me with the vacant storefront legislation. i was going to ask for an update but i can have a private conversation with you. >> chair fewer: we will talk about the increase for nonprofit organizations. thank you for being patient and waiting.
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>> thank you. about afternoon, ben rosenfeld, city controller. i am here to catch up on minimum compensation ordinary and the work coming out of its adoption last year. as folks will remember, in september of last year our office did some preliminary cost estimation work as the poured was considering changes to the mco. a birth of context -- a bit of context. the board did approve changes
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last fall it raised for profit rates, iss wages to a certain level. the focus today is non-profits how it impacts nonprofit organizations. given the ordinance, mco wage will rise to $16.50 on july 1st if the ad what funds are provided. in the future years the wage increase will increase by cpi. it will be approximately $1 above minimum wage of july l that is 1 $15.50. each will grow in future years over time. while the board was considering that those changes last year we did preliminary work on cost estimation that members may remember.
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we did a sample of 42 organizations to determine what this would play through costs and the organizations. just as a bit of context we have 450 nonprofit organizations we are contracting with. we thought it was meaningful but small. these are estimates at that time. we estimated at that time there was a fairly relatively small direct cost meaning the cost to raise workers on city contracts to $16.50 was comparatively small. we estimated the compaction cost of providing wage increases for other workers up the chain on city contracts was approximately $10 million. if one were to spread the same increase to noncity contracts it would be approximately $9.8 million. >> so it looks like page and
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page 3. we have a page missing. okay. i just moved around. >> what happened? >> chair fewer: a moment to get on the same powerpoint. usually i have a problem when they are not numbered. these are numbered. i'm still having a problem. should we just follow the presentation that you are putting on sfgovtv.
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>> that is probably best. we have version control problems today. >> chair fewer: we are just going to watch the screens here. >> my apologies. >> chair fewer: thank you, mr. controller. we did this early survey work last fall. estimated $10 million in direct and wage compression costs. $10 million if you carried the same wage levels to workers on noncity contracts. meaning not legally required but in increasing the wages for a certain group of workers on city contracts it does create both pressures on the organization. these are preliminary estimates what that could look like.
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the board at the time in kind of thinking about that established a working group to follow up on the questions. the legislation that increased mco, created working group to review wage equity when work is funded by city contract receive a higher wage than those funded by noncity contracts. which compaction. working the worker how does one treat the supervisor to maintain adequate wage scales on city contracts? this is the work that the board specifically charged. you asked us to help staff that working group and come back with a report by april 1st. we submitted that report on april 1st. i am here today to walk through briefly what the working group did and their recommendations to you. the working group included 10 representatives. it was a mix of three city
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staff including myself, members from the labor community and labor organizations, nonprofit employees and nonprofit management. then from january to march, the working group met three times for about two hours each in public meetings to talk through these issues and developed the set of findings and recommendations. i can run through these recommendations. first, the working group found that the mcs isn't the only pressure they are facing. this are facing pressures to maintain adequate work force to allow them to sustain programs. they recommended the recommendations should be considered in that. this is one of the many pressures they are facing. the working group secondly recommended the mayor and board should include funds in the
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coming budget to address these vertical and horizontal wage pressures. getting then to what do those pressures look like and what number would the working group suggest you put to them. they estimated the direct cost of the mco on city contracts was approximately $1.3 million. that is the cost of the direct legal requirement. the working group estimated wage compaction, increases for those above $16.50 should be $30 per hour. we should maintain $30 an hour to result in costs of about $12.9 million. the total of those two is approximately 14pone $2 million. estimating -- $14.2 million.
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the noncity contracts the working group recommended applying the same standard to maintain complete equity with workers on noncity contracts to maintain the wage differentials to $30 per hour. the first were unanimous. these were as you expect not unanimous. 7-3 votes. i will come back to later the dissenting view on those two recommendations. the last three recommendations they don't have so much to do with how much money is recommended to put in the budget but how to get it timely out to nonprofit organizations. we are doing a couple things. we are estimating the costs. they are hopeful you will appropriate money in the budget and weed