Budget and Finance Committee Meeting on Seal Rock Inn, Health Plans, and Telecom Agreements - July 12, 2023
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Budget and Finance Committee Meeting on Seal Rock Inn, Health Plans, and Telecom Agreements - July 12, 2023
The Budget and Finance Committee of the San Francisco Board of Supervisors met on July 12, 2023, at 10:30 AM, chaired by Supervisor Connie Chan, with members Supervisor Asha Safaí and Supervisor Joel Engardio (sitting in for Vice Chair Rafael Mandelman). The committee unanimously approved all 14 agenda items, including waiving fees for the historic Seal Rock Inn, adjusting the Budget and Legislative Analyst's contract, allocating SoMa stabilization funds, approving health plan rates for 2024, contracting for Microsoft products, designating advertising periodicals, authorizing emergency road repairs at Hetch Hetchy, and entering into wireless telecom license agreements.
Call to Order
Chair Chan called the meeting to order. The committee excused Vice Chair Mandelman. Clerk Brent Haliba reviewed public comment procedures.
Item 1: Seal Rock Inn – Waiver of Annual Occupancy Assessment Fee
- Discussion: Supervisor Chan introduced an ordinance to waive the annual public right-of-way occupancy fee for the Seal Rock Inn's major encroachment permit, which was originally granted in 1961. The fee was assessed only after the restaurant closed during the pandemic. The ordinance also removes the prohibition of commercialization of encroachments. Bobby and Barbara Elam, the family owners, spoke in support, noting the inn's 60-year history and the need to reopen the restaurant to support the community and local jobs.
- Public Comments: Tom Kuhn (Friends of Sutro Heights Park) supported the waiver, highlighting the restaurant's role as a gathering place for park visitors and VA patients. Stefano Casolado, Gary Gardner, and Rob Howe all expressed support for the legacy business and the need for dining in the underserved area.
- Outcome: Motion to forward to full board with positive recommendation. Unanimous (3 ayes).
Item 2: Cost of Living Adjustment for Budget and Legislative Analyst Services
- Discussion: Edward Deasis (Deputy Director of Administration for the Board) requested a 4.75% cost-of-living adjustment to the Harvey M. Rose contract, increasing the FY2023-2024 amount by $142,000 to $3,121,318. The adjustment matches the COLA granted to city employees and elected officials. The Controller certified the contract saves the city money.
- Outcome: No public comment. Approved unanimously.
Item 3: SoMa Community Stabilization Fund Expenditure
- Discussion: Claudine Del Rosario (MOHCD) requested authorization to expend $800,000 from the SoMa Community Stabilization Fund, but amended the request to $600,000 because only Soma Pilipinas submitted a responsive proposal. The funds will support Filipino mental health services, capacity building, and a cultural gateway. The remaining $200,000 will be re-bid later.
- Outcome: Amended to $600,000 and forwarded to full board. Unanimous.
Item 4: Medi-Cal County Inmate Program Agreements
- Discussion: Matthew Sir (Reimbursement Director, San Francisco Health Network) presented retroactive participation and administrative services agreements with the California Department of Health Care Services, not to exceed $24,443.73, for reimbursement of inpatient hospital services for Medi-Cal eligible inmates. The program offsets General Fund costs. Supervisor Safaí asked about alignment with CalAIM and Care Court; staff committed to follow up.
- Outcome: Approved unanimously.
Item 5: Health Service System Plans and Contribution Rates for Calendar Year 2024
- Discussion: Executive Director Abby Yant presented the proposed rates, reflecting an aggregate cost increase of 10.38% (city-only: 10.27%; medical only: 11.19%). Drivers include higher healthcare wages, increased mental health/substance use demand, and prescription drug costs. Mitigating factors include $14.7 million from a Sutter legal settlement and $1.9 million from rate stabilization. No plan design changes. Yant noted the national health cost trend. Supervisor Safaí requested a detailed breakdown of employee impacts by category. Chair Chan asked for a hearing in November on cost containment strategies and future projections.
- Outcome: Approved unanimously with understanding that a follow-up hearing will be scheduled after open enrollment.
Item 6: Microsoft Products Enterprise Agreement with Zones LLC
- Discussion: Hao Sieu (Strategic Sourcing Manager, Department of Technology) presented a new citywide agreement with Zones LLC, not to exceed $55 million for three years (base $46 million plus $9 million for upgrades). The contract covers all Microsoft products except for SFMTA (which procures separately). DT negotiated free licenses for 28,000 enterprise mobility and security seats ($1.5M savings) and Teams conferencing ($2.3M savings), and upgraded O365 to M365 without cost increase.
- Outcome: Approved unanimously.
Items 7 & 8: Outreach Community Advertising and Official Newspaper Designations for FY2023–2024
- Discussion: Selaida Umala and Will Alderman (Office of Contract Administration) explained the solicitation process. For the official newspaper, only the San Francisco Examiner met qualifications (San Francisco Chronicle did not print locally). For outreach periodicals, recommendations included Bay Area Reporter (LGBTQ+ community), Wind Newspaper (Chinese community), El Tecolote (Mission neighborhood), and others. The African American and Hispanic communities received no responsive bidders. Supervisor Safaí moved to add El Reportero (Spanish language) and Sing Tao Daily (Chinese language) as neighborhood periodicals to serve underserved areas, including Excelsior, Outer Mission, and other neighborhoods. OCA also requested adding additional neighborhoods for Wind Newspaper (Richmond, Sunset, Portola, etc.). The committee discussed the challenge of outdated printing requirements (Proposition J) and the need for a future ballot measure to update the code.
- Outcome: Motion to amend with additions passed unanimously. Items 7 and 8 forwarded to full board as amended.
Item 9: Emergency Declaration for Repair of Hetch Hetchy Water and Power Roads
- Discussion: Margaret Hennefer and Jeremy Spitz (SFPUC) presented the emergency declaration to repair road failures caused by unprecedented precipitation (over 20 inches in January and March 2023). The total cost is estimated at $20 million ($11.5M for an emergency contract with Sierra Mountain Construction, plus $8.5M for additional repairs and pavement). The SFPUC already used $8.4M in existing contracts, bringing total emergency spending to $28.4M. FEMA reimbursement is expected at 60–75%. Funding comes from ratepayer capital projects, which will be reprioritized. Minor clarifying amendments were offered by the city attorney. Supervisor Safaí requested a list of deferred projects.
- Outcome: Amendments accepted; forwarded to full board unanimously.
Items 10–14: Wireless Telecommunications Master License Agreements
- Discussion: Jeremy Spitz (SFPUC) presented five master license agreements with Verizon, AT&T, Mobilitie, ExtNet, and Crown Castle for installing wireless antennas on city poles. The agreements comply with a 2018 FCC order limiting fees. The annual license revenue will decrease by $3.2 million from previous agreements, but one-time fees increase. SFMTA projects net negative income through FY2029; SFPUC is net positive. By federal law, the city must provide pole access. Chair Chan and Supervisor Safaí proposed an amendment directing that revenues be used for the SFPUC streetlight program and SFMTA transit operations. One public commenter (Eileen Bulk) opposed the agreements as corporate welfare. Staff agreed to the amendment.
- Outcome: Amended and approved unanimously.
Key Outcomes
- All 14 agenda items were approved unanimously, many with amendments.
- The committee requested a November hearing on health plan cost management.
- The city will seek a future ballot measure to update printing requirements for official advertising.
- SFPUC will provide a list of capital projects deferred due to emergency road repairs.
Meeting Transcript
Good morning. The meeting will come to order. Welcome to the July 12th, uh 2023 meeting of the budget and finance committee. I'm Supervisor Connie Chan, Chair of the Committee. I'm joined by uh committee uh member, Supervisor Asha Safayi. We're also joined by Supervisor Joan Gardio, uh, who is sitting in for Vice Chair Rafael Mendelman. Our clerk is Brent Haliba. I would like to thank SFGov TV for broadcasting this meeting. Mr. Clerk, do you have any announcement? Yes, Madam Chair, just a friendly reminder for those in attendance to please make sure to silence all cell phones and electronic devices so as to not to interrupt our proceedings here in the chamber. The Board of Supervisors and its committees are convening hybrid meetings that low in person attendance and public comment. Also providing a remote access and public comment via telephone. Public comment will be taken on each item on this agenda. Those attending in person will be allowed to speak first, and then we'll take those who are waiting on the telephone line. For those watching remotely and streaming through SFGov TV.org, the public comment call in number is streaming across the screen and when connected, you will hear the meeting discussions, but you'll be muted and listening mode only. When your item of interest comes up in public comment is called. Those joining us in person should line up to speak, and those on the telephone should start the reading. It's also be added to the speaker line. If you're on your telephone, please remember to turn down your TV and all listening devices may be using. And each speaker will be allowed up to two minutes to speak unless otherwise stated. Alternatively, you may submit public comment and writing in either of the following ways, email them to myself, the budget and finance committee clerk at B R E N T. L I P A Hat S F G O V dot O R G. If you submit public comment by email, it will be forwarded to the supervisors and also included as part of the official file. You may also send your written comments via U.S. Postal Service to our office and city hall. That's one, Dr. Carlton B. Gillet Place Room 244, San Francisco, California, 94102. And finally, items acted upon today are expected to appear on the Board of Supervisors' agenda of July 18th, unless otherwise stated. Madam Chair. Thank you, Mr. Clerk. Before we call item number one, I would like to remind everyone that we have the budget and legislative analyst reports for items three, five, six, and nine through fourteen. So for those items, we will have the department presentation first, followed by the budget and legislative analysts report. Then we will take questions and then to public comments. Mr. Clerk, could you please call item number one? Uh before that, Madam Chair, should we should we excuse um Vice Chair Mandelman from the right? Sounds good. A roll call. I'll make the motion to uh excuse Supervisor Mendelman and with that a roll call, please. On that motion to excuse Vice Chair Mandelman from attending this meeting, Member Safai. Safai I, Member and Guardio. Hi. And Guardio I. Chair Chan. Hi. Chan. I we have three eyes.
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