(A) San Francisco Bonding and Financial Assistance Program.
(1) Program Description. The City and County of San Francisco, acting through the City Administrator, or, in his or her discretion, as delegated to the Risk Manager, intends to provide guarantees to private bonding companies and financial institutions in order to induce those entities to provide required bonding and financing to eligible Contractors and Subcontractors bidding on and performing City Public Works/Construction Contracts
. This bonding and financial assistance program is subject to the provisions of this Section 14B.16(A). (2) Eligible Contracts. The assistance described in this Section 14B.16(A) shall be available for any City Public Works/Construction Contract
to which this Chapter applies. (3) Eligible Businesses. Businesses must meet the following criteria to qualify for assistance under this Section 14B.16(A). (a) The business may be either a prime Contractor or Subcontractor; and
(b) The business must be certified by the CMD as an LBE according to the requirements of Section 14B.3, 14B.5, or 14B.6; (c) The business may be required to participate in a "bonding assistance training program" as offered by the Risk Manager, which is anticipated to provide the following:
(i) Bond application assistance,
(ii) Assistance in developing financial statements,
(iii) Assistance in development of a pre-bond surety profile,
(iv) Identification of internal financial control systems, and
(v) Development of accurate financial reporting tools.
(4) Agreements Executed by the Risk Manager. The Risk Manager is hereby authorized to enter into the following agreements in order to implement the bonding and financial assistance program described in this Section 14B.16(A): (a) With respect to a surety bond, the agreement to guaranty up to forty percent (40%) of the face amount of the bond or $750,000, whichever is less;
(b) With respect to a construction loan to be made to a Contractor or Subcontractor, an agreement to guaranty up to fifty percent (50%) of the original principal amount of the construction loan or fifty percent (50%) of the actual loss suffered by the financial institution as a result of a loan default, whichever is less; provided that in any event the City's obligations with respect to a guaranty shall not exceed $1,000,000;
(c) Any other documents deemed necessary by the Risk Manager to carry out the objectives of this program, provided that such documents shall be subject to review and approval by the City Attorney's Office.
(5) Monitoring and Enforcement. The Risk Manager shall maintain records on the use and effectiveness of this program, including but not limited to (1) the identities of the businesses and bonding companies participating in this program, (2) the types and dollar amounts of public work Contracts for which the program is utilized, and (3) the types and dollar amounts of losses which the City is required to fund under this program. The Risk Manager shall submit written reports to the Board of Supervisors every six months beginning January 1, 2015, advising the Board of the status of this program and its funding capacity, and an analysis of whether this program is proving to be useful and needed.
(6) Contributions to the San Francisco Self-Insurance Surety Bond Fund. Subject to the budgetary and fiscal provisions of the San Francisco Charter, each department that conducts public works or improvements under Chapter 6 of the Administrative Code shall contribute annually to the San Francisco Self-Insurance Surety Bond Fund ("the Fund") an amount that is set by multiplying the annual contribution rate set pursuant to Administrative Code Section 10.100-317(c) times its total appropriations for capital construction and improvement. (7) Annual Certification of Funds. The Risk Manager shall seek annual certification of funds from the Self Insurance Bond Fund and approval as to form of such certification from the Controller and City Attorney. Such certification shall be monitored by the Risk Manager to ensure the program operates within the transactional bounds of the Self Insurance Bond Fund and the appropriated budget for its administration. The Risk Manager will review the amount certified each fiscal year with the Controller and City Attorney, should there be a call on any bond funded through the program.
(8) Line of Credit; Credit Enhancement Program. The Risk Manager is hereby authorized to negotiate a line(s) of credit or any credit enhancement program(s) or financial product(s) with a financial institution(s) to provide funding; the program's guaranty pool may serve as collateral for any such line of credit.
In the event the City desires to provide credit enhancement under this Subsection for a period in excess of one fiscal year, the full aggregate amount of the City's obligations under such credit enhancement must be placed in a segregated account encumbered solely by the City's obligations under such credit enhancement.
(9) Default on Guarantees. The Director shall decertify any Contractor that defaults on a loan or bond for which the City has provided a guarantee on the Contractor's behalf. However, the Director may in his or her sole discretion refrain from such decertification upon a finding that the City has contributed to such default.
(B) Education and Training. The City Administrator and Director shall continue to develop and strengthen existing education and training programs for LBEs and City Contract awarding personnel.
(C) Cooperative Agreements. With the approval of the Board of Supervisors, the City Administrator may enter into cooperative agreements with agencies or entities, public and private, concerned with increasing the use of LBEs in government contracting or in private developments within San Francisco.
(D)
Mentor-Protégé Program. The Director shall establish a Mentor-Protégé Program (MPP) to foster partnerships between established, successful contractors and LBEs to provide training, networking, and mentoring opportunities with the goal to improve LBE MPP participants' ability to compete effectively for City contracts. As a benefit to participating in the MPP, the Director may pursuant to duly promulgated rules and regulations, exempt mentor Contractors from the good faith outreach requirements in Section
14B.8.
(E) LBE Contractor Advance Payment Program. The City Administrator, in consultation with the Controller, shall investigate and develop a LBE advance payment program to fund temporary loans to LBE Subcontractors for approved invoices on City-funded Contracts subject to the budgetary and fiscal provisions of the Charter. The City Administrator shall prepare an implementation plan, including a feasibility study, and shall submit the implementation plan to the Mayor by June 1, 2015.
(F) City Lease and Concession Agreements. The Office of Economic and Workforce Development shall convene a working group with members including but not limited to representatives from the Real Estate Department, Port, Municipal Transportation Agency, Airport, Recreation and Park Department and the LBE community, to investigate a local business enterprise preference program for City leases and concession agreements. The working group shall submit its program recommendations to the Mayor and Board by June 1, 2015.
(G) The City Administrator shall convene a working group to investigate whether there are barriers to participation by LBE firms in specific industries such as architecture. The working group shall report any findings to the Mayor and Board by September 1, 2015.
(Added by Ord. 92-06, File No. 050784, App. 5/11/2006; amended by Ord. 314-08, File No. 081443, App. 12/19/2008; Ord. , File No. 101006, App. 1/7/2011; Ord. , File No. 121211, App. 3/28/2013, Eff. 4/27/2013; Ord. , File No. 140999, App. 12/17/2014, Eff. 1/16/2015, Oper. (in part)* 7/1/2015)
* Editor's Note:
Section 3 of Ord. provides, in part, that "[e]xcept for Sections 14B.16(E) and 14B.16(F) of the Administrative Code which shall become operative on the effective date, this ordinance shall become operative on July 1, 2015 . . . ."
