Committee on Rules and Economic Development Meeting - October 9, 2013
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Committee on Rules and Economic Development Meeting - October 9, 2013
The Committee on Rules and Economic Development of the San Diego City Council met on Wednesday, October 9, 2013, at 9:00 a.m. in Council Committee Room 12th Floor, City Administration Building. Present were Chair Lightner, Vice Chair Faulconer, Councilmembers Alvarez, Emerald, and Kersey. The meeting covered four agenda items, including updates on youth employment, cybersecurity initiatives, military economic impact, and a proposed memorandum of understanding with the San Diego City Employees' Retirement System (SDCERS). All five committee members were present.
Consent Calendar
- Approval of Minutes: The minutes from the September 25, 2013 meeting were approved by unanimous consent.
Public Comments & Testimony
- Non-Agenda Public Comment: None.
- Public Comment on Regulatory Streamlining, Open Government, and Economic Development: None.
Discussion Items
Item 1: Quarterly Performance Report from San Diego Workforce Partnership – Connect2 Careers San Diego Program (Informational)
- The San Diego Workforce Partnership presented on the 2013 Youth Employment Initiative. Key outcomes include:
- Goal of 200 youth employed; actual 202 youth employed.
- Over 600 youth completed work readiness training.
- The city's $200,000 investment leveraged a $200,000 match from Walmart, funding subsidized employment for an additional 162 youth in nonprofit and public sector jobs, for a total of over 360 jobs.
- Estimated regional economic impact of nearly $500,000 from wages.
- A $100,000 grant from the Youth Opportunity Incentive Fund was also secured.
- Testimonials:
- Heather Ely, Research Associate at Ignita Inc., expressed strong support, noting that interns from the program were well-prepared, reliable, and increased lab throughput. She encouraged other San Diego companies to participate.
- Dustin Wynn, a 17-year-old senior at Crawford High School and a Life Sciences Summer Institute intern, shared that the program changed his career path from aspiring English teacher to pursuing a science field. He highlighted the hands-on training and contribution to real laboratory work.
- Councilmember Emerald and Councilmember Faulconer voiced strong support, emphasizing the importance of public-private partnerships and committing to continued funding and advocacy. Councilmembers noted that the program helps close the skills gap and retain young talent in San Diego.
- Action: Informational only; no formal action taken.
Item 2: Report from Chair Lightner on Cyber Security Summit (Informational)
- Chair Lightner reported on the September 24, 2013 Cyber Security Summit organized to position San Diego as a major cybersecurity hub. Panelists included U.S. Congresswoman Susan Davis, regional EDC leaders, military advisory council members, and academics.
- Key takeaways:
- Cybersecurity is both a national security and economic growth opportunity.
- San Diego is well-positioned due to its military bases, defense industry, tech companies, and universities.
- Need to attract and retain talent through pathways for students, veterans, and underemployed adults.
- Increased public-private networking and incubator support are needed.
- Next steps: The Economic Development Corporation (EDC) will produce an economic impact report on the cybersecurity sector before the end of 2013.
- Councilmembers Emerald and Kersey commended the initiative, noting the high growth potential of cybersecurity jobs (projected 22% growth through 2020) and its importance for national defense and export competitiveness.
- Action: Informational only; no action taken.
Item 3: Presentation from San Diego Military Advisory Council (SDMAC) – 5th Annual Military Economic Impact Study (Informational)
- SDMAC Executive Director Larry Blumberg and 2013 President Earl Widerbrook presented the study, prepared by the Fermanian Business and Economic Institute at Point Loma Nazarene University.
- Key statistics for San Diego County:
- 302,000 total jobs supported by military spending (direct, indirect, and induced), representing 22% of all county jobs.
- $32 billion in gross regional product (GRP).
- Nearly $9 billion in payroll from active duty, reserves, and civilian employees.
- $2.4 billion direct spending from 53 Navy ships homeported in San Diego; total impact including multipliers is $4 billion.
- Housing allowances for military personnel (25% of compensation) significantly impact the real estate market.
- First-year inclusion of tourism impact: $50 million annually from visits to military personnel.
- Top priorities for the region:
- Retaining a third aircraft carrier at North Island.
- Supporting shipbuilding and repair industry (e.g., GDNASCO).
- Maintaining Space and Naval Warfare Systems Center Pacific (Spawar) and Fleet Readiness Center Southwest.
- Mitigating Marine Corps downsizing (projected loss of 6,000 Marines and 7,800 family members).
- Councilmembers Kersey, Emerald, Faulconer, and Alvarez voiced strong support, emphasizing the need for a unified voice in Sacramento and Washington to protect military assets. Councilmember Kersey noted that the study was cited by General Amos during a recent delegation trip.
- Action: Informational only; no action taken.
Item 4: Report from Risk Management on Memorandum of Understanding (MOU) with SDCERS for Retiree Health Benefits
- Risk Management presented a proposed MOU to formalize SDCERS' administration of retiree health benefits, a service performed since 1982. The annual cost for these administrative services is approximately $526,160, included in the FY 2014 budget.
- The MOU includes indemnification of SDCERS against claims arising from administering non-pension benefits, due to IRS restrictions (2006-2007 Voluntary Compliance Program) preventing use of pension trust assets for retiree health expenses.
- Discussion:
- Councilmember Faulconer requested a written legal analysis from the City Attorney's Office on the indemnity provisions, particularly concerning gross negligence. He also sought IRS documentation and information on whether a Request for Qualifications (RFQ) could be issued for third-party administration.
- Councilmember Emerald questioned the enforceability of indemnification for gross negligence under California law.
- Chair Lightner expressed concerns about transferring risk to the general fund without thorough analysis.
- Motion: Councilmember Faulconer moved, seconded by Chair Lightner, to direct the City Attorney to return to the committee with a draft ordinance, a written legal analysis of risks, IRS background, and information on the possibility of an RFQ. The motion passed 5-0, sending the item back to committee for further consideration.
Key Outcomes
- Youth Employment Initiative: No action required (informational). Council members expressed continued support and noted potential budget memo requests for reinvestment.
- Cybersecurity Hub: Informational; EDC to produce economic impact report by end of 2013.
- Military Economic Impact Study: Informational; committee acknowledged the importance of the data for advocacy.
- MOU with SDCERS: Motion approved 5-0 to bring the item back to committee after obtaining additional analysis, IRS documentation, and evaluation of third-party administration options. The next committee meeting is scheduled for October 23, 2013, but this item may be brought to the November 6 meeting.
Meeting Transcript
You're watching City TV twenty four. Your access to City Hall. This is the comment. Good question. We'll get an answer. They have an answer. Just checking. Good morning. Welcome to today's meeting of the Rules and Economic Development Committee. Let the record reflect that we have a quorum consisting of Vice Chair Faulkner, Councilmember Emerald, and myself. Also here with us is committee staff, including Priscilla Dugard from the Office of the City Attorney, Jeff Kuar from the Office of the Independent Budget Analyst, Nika Bukolova, the committee consultant, and Jamie Bradford from the mayor's office. Thank you all for being here. We'll begin our agenda with non-agenda public comment. I believe we have none, and we don't have any regulatory, streamlining, open government, and economic development comment. Are there any comments from the committee? Seeing none, are there any comments from the city attorney, IBA, or mayoral staff? Our first order of business is approval of the minutes from our September 25th, 2013 meeting. So moving on to the first item on the agenda is item one. It's the quarterly performance report from San Diego Workforce Partnership regarding the implementation of the 2013 Youth Employment Initiative Connect to Careers San Diego Program. And you'll correct me if I got that wrong. And thank you very much for joining us today. We look forward to your presentation. How much time would you like for this? A lot of different sections, and this is brand new from any prior year, so we are able to leverage this going forward. Also, we've been very active with uh e News, getting the word out, and you hopefully are receiving that, but we're able to profile uh the progress of this important project and uh again getting out to thousands in the community and raising awareness, which has led to uh more jobs. A lot of networking through uh all the other social media outlets. We had the job summit back in May that was a great success that led to uh many new positions, a lot of awareness. We've established great community partnerships with um all the leading groups in the community that you well know, like Connect as well as the uh Chamber, uh junior achievement. We worked closely with them on some of the uh different curriculum that the youth uh participated in in preparing for work. Also uh the EDC has been a great partner, actually, all of them throughout the uh the entire region and getting the word out. So the results. Uh the goal was 200, we did it. 202, we're thrilled. That was a high mark considering that we started from scratch and rebranded. Um we also had uh many more applicants than we could serve this year because there's, as you know, such a great need out there. But we also had 600 plus who went through work readiness training, which is a vital piece of um this entire project. So, in addition to that, though, I want you to know that the um 200,000 that you invested allowed us to get more money in to build the program. So Walmart matched that uh investment of $200,000 that uh led to subsidized employment for another 162 uh young adults in nonprofit work and public sector work. So that led to over 360 jobs in the end, again, thanks to your investment. So here's a uh quick list of some of the employers in our region. I'm not going to read every single one, so uh they're up there, and here's another way to look at it. Uh a lot of leading companies throughout the regions, including uh the City of San Diego, a few shots of some of the uh young adults at work and uh with council member offices. Qualcomm, again, has self-funded their program. They've done over 30 um, I think in this past year alone, so they have been a great partner. And they're also looking at a way to help in the in future years to bring in uh all future young adult workers uh in for a pre-training uh before they go out into the workforce. So that's an exciting new development that may occur. So the return on investment, um, when we use the multiplier of how many dollars uh that we can um tangibly put to every dollar invested, it actually leads to a result of uh over almost $500,000 uh regional economic impact thanks to uh again your investment and the wages uh gained from their employment. As I mentioned, your uh investment plus the Walmart Foundation, it also allowed us to apply for and successfully get another 100,000 grant for the youth opportunity incentive fund to help build the youth development office. So, what's happening in other regions? We wanted to give you a quick um touch point as to what's happening in other large cities uh across the country and how they are able to fund this.
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