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Volume 10, Number 2, March 30, 2004
This issue of the BOMA San
Francisco Advocate is brought to
you by
Flynn Properties,
Inc.
San
Francisco Board of Supervisors Poised
to Pass More Anti-Business Legislation
It seems that the San Francisco
Board of Supervisors can't do enough
to harm the local economy. This
week the Board is poised to pass
legislation banning residential
demolitions of buildings with 20
or more units citywide
because of a few tenant activists
living in the Trinity Plaza apartments on Market Street who fear they may lose a good
deal. Ironically, the tenants and
the property owner have worked out
a deal that benefits everyone, tenants
and the owner, Angelo Sangiacomo,
and will allow the construction
of an additional 1,000 plus units
of rental housing in a location
that desperately needs to be upgraded.
Unfortunately, the majority of Supervisors
can't seem to do enough for the
"tenant lobby" and will probably
press on with this extreme piece
of legislation. Bans such as this
will only serve to keep our existing
older housing forever, and will
lead to deterioration of all residential
rental properties in the long term,
while doing nothing to help create
more housing in the city. The long
term bad effects legislation such
as this demolition ban can have
on our city and its economy are
never fully explored. Why?
Another example of current bad legislation
poised for final passage is the
formula retail ban/restrictions
legislation. This legislation, the
brain child of Supervisor Matt
Gonzalez, proposes a total ban
on so-called chain stores in Hayes
Valley and Cole Valley and sets
strict citywide notification requirements
(conditional use permits) on all
so-called "formula" (read: chain
store) stores who have 11 or more
outlets worldwide. This kind
of legislation is never good economic
policy, and setting the threshold
at 11 outlets will actually hurt
the small and medium-sized franchises
far more than the thousand-store
corporations like Starbucks or Walgreens,
etc. The larger companies have the
money to wait out a lengthy conditional
use permit process, and can pay
the extra money extracted from local
community activists for the privilege
of opening a store in San Francisco. Small and medium-sized businesses
can't afford a long permit process,
and surely can't afford to give
away future profits they're not
sure they will even realize. The
Board of Supervisors, including
its President, should be encouraging
our small and medium-sized businesses
to grow, not making it more difficult
for them by creating a means for
potential local competitors to extort
concessions from the new guy for
the right to open up a business
in town.
A third piece of bad legislation
is the one dealing with registering
so-called permit expediters, or
as they are calling it now: permit
consultants. Here
again the Board of Supervisors is
set to pass legislation of wide-reaching
consequences, on the basis of a
perceived problem is only with one
or two people. Unfortunately, the
Board of Supervisors are poised
to pass this overkill legislation
just as the DBI has finally gotten
its automated permit tracking system
up and running. The building department's
tracking system now adds a huge
measure of transparency to the whole
process, for every permit customer.
With this tracking system, the City
will very easily be able to identify
whose permits have moved through
the system, and how fast. As an
organization whose members use the
DBI permit process everyday, BOMA
has urged restraint in adopting
this new and expensive registration
process for permit consultants.
Frankly, the
reports of favoritism for a few
individuals has been grossly exaggerated
by the press, and no real statistics
have ever been produced to say what
percentage of permits have been
moved to the "front of the line"
by illegal means. Yet, even with
the total lack of real facts, the
Board of Supervisors is set to move
forward with a complicated, and
costly new registration regulation
for permit consultants. It is so
over the top that the Ethics Commission
is asking for an increase in their
operational funds if this legislation
is passed. The Board of Supervisors
should be reducing the size
of city government, not growing
it, which this ordinance would do.
More Bad News from
the San Francisco Board of Supervisors…
Supervisor Fiona Ma has unintentionally fallen
into the worst position a politician
can be in: recommending new taxes.
She has been heading a "Revenue
Advisory Panel" since September
of last year, which has just ended
its meetings, with no consensus
on any new taxes save one: the group
agreed to support the restoration
of the vehicle licensing fee back
to its previous levels before the
recent reduction by Governor Schwarzenegger.
This one tax increase could be worth
an additional $64 million annualized
to the city, if passed by the voters.
Another good one: charge residential
rental property owners a one time
fee of several thousands of dollars
to convert/sell their rental units
to existing tenants interested
in becoming homeowners. This would
require the city to relax its condo
conversion cap restrictions which
are currently set at 400 units per
year, but could bring substantial
new revenues into the city's coffers,
as well as raise the property tax
base, as rental units are generally
appraised at a lower value. The
bad ones being considered: increasing
the property transfer tax, increasing
the payroll tax, charging partnership
distributions a payroll tax, charging
an annual commercial occupancy tax,
charging a residential utility tax
on electricity, gas, telephone,
and cable television, and charging
a parcel tax of between $250 per
residential parcel up to $1,000
per year for non-residential parcels.
The business community has been
united in its position that no
new taxes should be proposed,
with the exception of the VLF increase,
in the current economic downturn,
and that city hall must reduce its
staffing and costs first. The city
budget battles are just beginning,
and promise to be protracted and
ugly. Public
employee strikes are a real possibility.
San
Francisco Supervisor Score
Card Reveals Anti-Business Majority
Starting in 2001, the year the
so-called anti-Willie Brown Board
of Supervisors took office, a tally
of votes taken of legislation and
their effect on the business community
has revealed some serious anti-business
feelings by a number of Supervisors.
Leading the pack in anti-business
voting is Supervisor Chris Daly,
with only a 16% business-favorable
record. Close behind him were Supervisors
Tom Ammiano and Matt Gonzalez with
a 20% business-favorable record.
Supervisors Sophie Maxwell (34%),
Jake McGoldrick (29%), Aaron Peskin
(31%), and Gerardo Sandoval (29%)
all scored at or less than 1/3 of
the time voting to support the business
community. The only Supervisors
with a majority business-favorable
record were/are: Fiona Ma (53%),
Bevan Dufty (69%), Tony Hall (75%),
and Michela Alioto-Pier (75%).
Something to keep in mind as the
re-election for seven of them comes
up this fall…
Support
Your BOMA-SF-PAC…Attend the BOMA
PAC BBQ and Opening Night Party
April 13th!
The BOMA San Francisco Political
Action Committee in conjunction
with the BOMA Associates Committee
will be hosting a grand party before
the first Giant's night game of
the season on Tuesday, April 13th.
The BBQ, which starts at 4 p.m., will be held behind the China Basin Landing Building, 185 Berry Street, and is always a fun and filling
event! PAC Board and Associate Committee
members will play party hosts, and
you get to eat, drink, and be merry,
and then walk over to the game,
which starts at 6:05 p.m. This is a terrific way to help
your association's PAC raise the
funds it needs to fight for your
interests! Check out the BOMA website
www.bomasf.org
to register. DO IT TODAY!
Understanding
& Interpreting BOMA's Standard Method
of Floor Measurement Seminar April
29th
This very valuable seminar will
help building managers, design professionals,
and owners understand and interpret
the set of area calculations produced
by BOMA International, and accepted
by the American National Standards
Institute (ANSI). Learn how to determine
building area calculations before
you sign that next lease! Learn
why an annual maintenance of a building's
area calculations is necessary as
leases turn over. The seminar will
be presented by Gordon L'Estrange,
of Ottolini, Booth & Associates,
architects, and the Chair of BOMA's
Building Codes Task Force. This
three hour seminar will be held
at San Francisco State University Downtown Center, 425 Market Street, Room 2608, beginning at 8:15 a.m. Registration costs $85 for
members, and $95 for non-members,
and can be done online at www.bomasf.org.
Don't Miss It!
BOMA
Members Visit Sacramento
Lawmakers to Voice Commercial Real
Estate Concerns
On March 15th, BOMA
members from around the state visited
Sacramento lawmakers to press our case
for better treatment of commercial
real estate. A delegation from San
Francisco/San Mateo included former
BOMA San Francisco President Todd
Robinette (Equity Office Properties),
Harout Hagopian (Equity Office
Properties), the Chair of BOMA's
San Mateo Government Affairs Committee,
Jim Christian (Shorenstein
Company), the Chair of the BOMA-SF-PAC,
Margot Crosman (Unico Properties),
the Vice Chair of the BOMA-SF-PAC,
Rick Buziak (Boston Properties),
Chair of BOMA's San Francisco Government
Affairs Committee, Bruce Schilling
(August Supply), a member of the
BOMA-SF-PAC Board, Taylor Gill
(Townsend Building Services), a
member of the BOMA SF Government
Affairs Committee, Peter Sotos
(real estate investor), and both
Marc Intermaggio and Ken
Cleaveland from BOMA. Key discussion
issues on the table for BOMA included
defending our industry against split
roll tax proposals, promotion of
energy policies that will help reduce
costs of electricity to office buildings,
and consequently to their small
business tenants, and a change in
the commercial tenant deposit law
that would clarify the point that
security deposits could be applied
to forward rent for defaulting tenants.
In opposing split roll, BOMA members
noted that raising property taxes
on commercial properties would cost
jobs, estimated by the California
Taxpayers Association to be at least
75,000, and possibly much more.
Worse, a split roll tax would hurt
the state's small businesses disproportionately,
and could raise their pass-through
costs by 12%, according to one estimate,
if the current California Teachers
Association initiative calling for
a 55% increase in commercial/industrial
property taxes passes. Our message
was very simple on this issue: SPLIT
ROLL MEANS LOSS OF JOBS!
BOMA
California Energy
Committee Promotes Changes to Reduce
Costs/Increase Reliability
As part of the legislative priorities
for BOMA California, the Board of
Directors did two things: it adopted
new energy principles at the March
meeting, and charged a new statewide
energy committee with reviewing
and recommending legislation that
would support these principles.
The BOMA California Energy Principles
adopted were:
Ø
Lift
the suspension on new direct access
for customers over 500kw.
Ø
If
restructuring were to include "core"
and "non-core" classes of consumers,
allowing office buildings to select
their class. "Core" consumers are
those that use less than 500kw and
receive power through an investor-owned
utility.
Ø
Allow
on-site generation without penalties,
departing load fees and other exactions.
Ø
Modify
regulations to permit owners to
freely install electric sub-meters
so that tenants will pay for the
power they use.
More
News on State Legislation Impacting
Commercial Real Estate
At the BOMA California Legislative
conference, a number of bills were
reviewed, and positions taken. Here
is a sampling:
ENERGY
LEGISLATION
AB
428 (Richman)
This bill relates to the option
of allowing non-core customers (large
users) the ability to obtain electricity
from companies other than investor-owned
utilities. BOMA Position:
SUPPORT
AB
2006 (Nunez)
This bill, sponsored by So. Cal
Edison, would reassert control of
investor-owned utilities over the
state energy system. BOMA Position:
WATCH
AB
2484 (Ridley-Thomas)
This bill would establish a streamlined
system of energy coordination.
BOMA
Position:
SUPPORT IN CONCEPT
SB
1398 (Morrow)
This bill would reduce regulatory
requirements to encourage the use
of on-site generation.
BOMA
Position:
SUPPORT
SB
1565 (Bowen)
This bill would require the adoption
of a strategic energy plan for the
state. BOMA Position: SUPPORT
LABOR
RELATIONS
AB
2213 (Goldberg)
This bill would regulate the janitorial
service industry by providing specific
record keeping and registration
requirements. BOMA Position:
OPPOSE
AB
2850 (Ridley-Thomas)
This bill would require a new security
contractor to retain for 90 days
the employees of the previous contractor.
BOMA Position: OPPOSE
SB
1521 (Alarcon)
This legislation would increase
the period for retaining janitorial
workers after a new contract from
60 to 90 days. BOMA Position:
OPPOSE
DISABLED
ACCESS
AB
1707 (Assembly Judiciary Committee)
This bill would quadruple
the fine for "interfering with the
rights of an individual with a disability."
BOMA Position: OPPOSE.
SB
1775 (Ortiz)
This bill would require building
standards to be consistent with
"the latest edition of the model
code." This could be a way to lock
in the use of the NFPA codes over
the International Building Codes,
something BOMA opposes. BOMA
Position on bill: WATCH.
THE
ENVIRONMENT
SB
1722 (Ducheny)
This bill would prohibit the filing
of a Proposition 65 legal actions
in the public interest if
a settlement has been entered on
the same facts. BOMA Position:
SUPPORT.
Special
Meeting on San Francisco's
Sprinkler Retrofit Ordinance Set
for April 1st!
A special meeting of the Building
Department and Fire Departments
is planned for Thursday, April 1,
at 1 p.m. at 1660 Mission Street, Room 2001, to discuss under
what circumstances extensions to
the February 15, 2006 deadline may be considered
or granted. Building representatives
are encouraged to attend and give
testimony at this meeting. BOMA
has requested the DBI, in conjunction
with the Fire Department, to issue
a bulletin giving owners guidelines
for requesting such an extension.
Don't
Miss the Annual Commercial Recycler
of the Year Awards Luncheon April
22nd!
This year 20 BOMA office
buildings have entered the best
commercial recycling program contest,
and winners will be announced at
the April 22 luncheon at the Palace
Hotel. Buildings entered in three
categories: small buildings under
300,000 square feet, medium-sized
buildings between 300,000 and 600,000
square feet, and large-sized buildings
over 600,000 square feet. The contestants
for the 2003 CoRY winners (given
this year for the previous year's
achievements in reducing garbage
going to the landfill) are:
Small Buildings: 260 Townsend, 49 Stevenson,
255 California, 555 Montgomery, The Ferry Building, and 353 Sacramento
Medium Buildings: 456 Montgomery, 455 Market, 101 2nd Street, 100 Pine, 95 7th Street, and 220 Montgomery
Large Buildings: 555/575 Market, 235 Montgomery, Post Montgomery Center (1 Post), Levi's Plaza, 525
Market, the Gap headquarters building
on the Embarcadero, and 1 Market Street.
Hotels and restaurants that
have exemplary recycling programs
will also be honored. Most importantly,
the leading "Green Building" exponent, David Gottfried,
who recently authored the book "Greed
to Green" will be the keynote
speaker. San Francisco Supervisor Sophie Maxwell,
the most environmentally-focused
city supervisor, will present the
winners with their awards. Sign
up today on the BOMA San Francisco
website to avoid missing out at
www.bomasf.org!
11:30 a.m, April 22, 2004 at the Palace Hotel. Be
There!
Department
of Building Inspection Update
In case you miss the regular
meetings of the BOMA Building Codes
Task Force, here is the latest information
on what is happening at the city's
building department (and related
city departments) that may impact
or interest you:
a. All
the information about permit
history and complaints is now
available on line. The
status of your permits for each
building is listed at www.sfgov.org.
It shows the status of all
permits. The
bar coding of applications/plans
is still in process of being implemented.
b. The
city's lead paint ordinance
is coming before Board of Supervisors
in a couple of weeks. This ordinance
includes the requirement to encapsulate
old paint but will mostly impact
residential buildings.
c.
There is an administrative bulletin
related to non-conforming exiting
in high-rise buildings. The City
wants to make sure that the bulletin
is in compliance with the current
code before releasing it.
d.
The city's has completed writing
its demolition and debris ordinance
and the Building Department will
be reviewing it.
e.
New energy conservation standards
related to the new 2005 code requirements
are being proposed for adoption
that call for buildings to be continually
checked to make sure they are and
remain in compliance with state
energy reduction requirements.
There is also some support
in some quarters for bringing back
CECO, the commercial energy conservation
code, for San
Francisco's
high rise buildings. It will be
important for BOMA members to help
the association gather information
from their properties related to
the cost impact of such a re-authorization
of CECO. To that end, someone knowledgeable
in quantifying costs in this area
would be of huge assistance to BOMA
f.
The problem of the city's inadequate
sewage capacity and its impact
on future commercial developments
has become a major issue during
the recent wet weather. Sewer back
ups in existing commercial buildings
have become a very unpleasant reality
all too often when it rains for
a number of BOMA buildings. The
two systems (storm and sanitary)
are co-mingled and there is not
adequate capacity to even handle
the current load. BOMA
will seek to determine who will
be working on a solution to this
problem at the PUC and at the Department
of the Environment. The BOMA Building
Codes TF will request a representative
from the SFPUC to attend a future
meeting and discuss this issue and
a possible plan to deal with it.
g.
The BOMA Building Codes TF will
begin regular meetings with the
city's Department of Public Works
to discuss several pending issues
of importance to commercial property
owners. A priority list of items will be
assembled and input from BOMA members
is critical! BOMA task force members
will initially be working with Barbara
Moy and Nick Elsner at
DPW to come up with written guidelines
on acceptable curb cuts, slip-resistant
coatings for sidewalk covers, and
issues surrounding sub-sidewalk
basements. Kevin Greene, of
Greene Construction, will chair
the BOMA Codes TF subcommittee that
will include Greg Johnson, Jeffrey
Feldman, and Gordon L'Estrange.
Other BOMA members are encouraged
to join it.
h. The Department of Building
Inspection is interested in creating
a graphical standard for disabled
access documentation, and will
be reconvening its "path of travel
subcommittee", but needs the help
of industry professionals. Anyone
interested in assisting the Department
should contact Laurence Kornfield
(558-6244).
i. The Department is working
on guidelines for Office Tenant
Improvement permits that will be
able to be processed over the counter.
j. The Department has issued
a proposed bulletin on mitigating
asbestos hazards during alteration
and demolition. The administrative
bulletin (AB 59 - Draft #20!) is
available for review. Any suggestions
or comments on this latest draft
should be submitted to Laurence
Kornfield by Friday, April 9, 2004.
"There are two things that are
important in politics. The first
is money, and I can't remember what
the second one is."
[Marcus Hanna, an Ohio Industrialist, 1895]
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