1 BEFORE THE CALIFORNIA STATE BOARD OF EQUALIZATION 2 450 N STREET 3 SACRAMENTO, CALIFORNIA 4 5 6 7 REPORTER'S TRANSCRIPT 8 FEBRUARY 3, 2009 9 10 ITEM P1 EXECUTIVE DIRECTOR'S REPORT 11 ITEM a FUTURE OF BOE HEADQUARTERS 12 13 ---o0o--- 14 15 16 17 18 19 20 21 22 23 24 25 Reported by: Juli Price Jackson 26 No. CSR 5214 27 28 1 1 2 P R E S E N T 3 4 For the Board Betty T. Yee of Equalization: Chair 5 6 Judy Chu Vice-Chair 7 Bill Leonard 8 Member 9 Michelle Steel Member 10 Marcy Jo Mandel 11 Appearing for John Chiang, State Controller 12 (per Government Code Section 7.9) 13 Diane G. Olson 14 Chief, Board Proceedings Division 15 16 Ramon J. Hirsig Executive Director 17 18 ---oOo--- 19 20 21 22 23 24 25 26 27 28 2 1 INDEX OF SPEAKERS 2 ---o0o--- 3 Name Page 4 5 Bobbi Smith 8 6 7 ---o0o--- 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3 1 450 NSTREET 2 SACRAMENTO, CALIFORNIA 3 FEBRUARY 3, 2009 4 ---oOo--- 5 MS. OLSON: Next item is P1, Executive 6 Director's Report, future of BOE headquarters. 7 MS. YEE: Okay. 8 MS. OLSON: And we have one speaker. 9 MS. YEE: All righty, we have one speaker for 10 this item. 11 Miss Smith, do you want to come forward? 12 Mr. Hirsig? 13 MR. HIRSIG: Madam Chairwoman, Members, it's my 14 privilege to be here today to talk to this item. 15 In August of 2008 the Board of Equalization 16 authorized staff to proceed with relocating 17 approximately 500 employees outside the headquarters 18 building to bring the current staffing levels within the 19 headquarters building to an acceptable level. 20 In addition to addressing the immediate space 21 needs for headquarters, you asked staff to develop a 22 long rage vision for our optimum housing needs. 23 It's my privilege to do so today. 24 Originally our headquarters building was 25 provided space for 1900 employees, with a maximum 26 capacity of 2200. In 1997 the population had increased 27 to 2300. Today, based on vacancies, absences, 28 flexibility of work schedules, staff already relocated, 4 1 the number of staff in the building at any one time 2 remains about, approximately, 2300. 3 However, based on recent budget augmentations, 4 the number of BOE headquarters employees is expected to 5 increase to approximately 2650 by 2011. And even more 6 so by 2012. This projected growth will require more 7 space. 8 The executive team has worked collaboratively 9 in discussing anticipated space needs, ways of doing 10 business in the future, possible consolidation of some 11 functions, centralizing or decentralizing functions as 12 best meets the business needs. 13 Before you today is a document entitled, "BOE 14 of the Future," which contains three different scenarios 15 for your consideration. 16 The first scenario envisions a multi-building 17 low rise complex on a campus in the greater Sacramento 18 area. 19 The second scenario envisions a new downtown 20 high rise location, which can accommodate our future 21 growth needs. 22 The third scenario would maintain our current 23 headquarters in downtown and right size and continuing 24 to move staff to units in the downtown area. 25 Each of these scenarios contains benefits and 26 challenges, which are outlined in the "BOE of the 27 Future" document. 28 We believe that any decision to move forward 5 1 should be giving consideration to the following 2 criteria: 3 Scalability, the ability to grow or decrease in 4 size, as necessary. 5 The co-location of staff, we've learned that 6 with staff working together in close proximity our 7 ability to do our work better has been achieved. 8 Transportationwise, we need to be located close 9 to the downtown area in the scope of either perhaps 10 light rail, bus transportation. 11 Overall cost benefit is, of course, a major 12 consideration. 13 And also the impact on our taxpayers. 14 We believe we must address our physical 15 location needs now, even in these very tough fiscal 16 times because BOE has outgrown our current headquarter 17 space and we anticipate growth in the coming years to 18 help in the collection of revenue. 19 Whichever option or scenario we choose, the 20 timeline can range anywhere from two years for a private 21 facilities that may be under construction, to eight to 22 ten years, based upon a State facility which is built to 23 the parameters of the Board of Equalization. 24 It's my privilege to answer any questions you 25 might have. If you'd like me to go into a little bit 26 greater detail on the scenarios, I'd be happy to do so 27 also. 28 We're excited about this. It's really an 6 1 opportunity to set the stage for the next generation of 2 BOE. 3 Madam Chair? 4 MS. YEE: Thank you. 5 Good morning, Ms. Smith. 6 MS. SMITH: Good morning, Madam Chair. 7 MS. YEE: Please introduce yourself formally 8 for the record. 9 You have three minutes for your comments. 10 ---o0o--- 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7 1 BOBBISMITH. 2 ---o0o--- 3 MS. SMITH: Thank you. 4 Madam Chair, Members of the Board, by name is 5 Bobbi Smith. I am here as a representative of the 6 District Labor Council 782 of SEIU Local 1000. 7 I am here for the second time to speak 8 regarding BOE headquarters. I'd like to put forth an 9 analogy here that if a person buys a car, the average 10 individual puts 10,000 miles on the car each year. If 11 they put more than that, say, 15, 20,000, that car is 12 going to break down, need repairs and need replacement a 13 lot sooner than is normally expected. 14 We have the same issue here with this building 15 with the maximum occupancy being exceeded, putting 16 stress on the infrastructure, the elevators, the 17 carpeting -- basically everything in this building, it's 18 breaking down quicker than we expected. And it's 19 creating issues for the employees here. 20 I recommend that the Board pursue getting all 21 of the employees out of this building as soon as 22 possible. We would like to keep all of the employees 23 within walking distance of each other, if we have to 24 remain here in the downtown area, or find some type of 25 campus with -- which takes into account the fact that we 26 have transportation issues of the employees, we have the 27 day care here that would have to be addressed. 28 Cafeteria would have be to addressed. 8 1 But we need to move forward with vacating this 2 building. It's just getting worse and worse as we 3 remain occupied here. 4 Thank you. 5 MS. YEE: Thank you, Miss Smith. 6 Questions or comments, Members? 7 Let me chime in. 8 Mr. Hirsig, you are having us consider three 9 options here, which is, first, the multi-building low 10 rise complex that would be located on a campus in the 11 greater Sacramento area; secondly, the downtown high 12 rise locations other than our current headquarters, and 13 then, third, maintaining our current headquarters. 14 I guess I will just state personally on this, I 15 would agree with Ms. Smith, I think we need to look for 16 other locations and certainly the work that's been done 17 in the current headquarters building, and really, from 18 my perspective, not really an end in sight with regard 19 to when this building could be reoccupied, and certainly 20 without any other problems occurring seems to be a big 21 uncertainty. 22 And to the extent that we already are looking 23 to relocate employees because of overcapacity, my 24 preference would be to look at -- at least in the near 25 term -- downtown high rise locations other than our 26 current headquarters building. 27 And that's not to preclude ultimately 28 considering a low rise complex, but I think in these 9 1 fiscal times, I'm not ready to make that leap in terms 2 of that being the ultimate decision. 3 We may decide over the course of the years that 4 this process will take that, in terms of how this agency 5 desires to do business and as our business needs change, 6 that having multiple locations for all of the agency -- 7 at least all concentrated downtown, may be our desire. 8 Is there a way to express that to General 9 Services as we have them go out and do the -- 10 MR. HIRSIG: Yes, ma'am. 11 If it's the direction of the Board that we 12 should take a look to the future in that light, since we 13 are already taking a look for facilities for the 14 additional 500, we could have them expand that search 15 and I could come back and report to you on what the 16 opportunities are within the greater downtown area, at 17 least with regards to your first request. 18 MS. YEE: I guess -- can they do both? 19 Can they do kind of -- can they look at both 20 downtown high rise locations, as well as search to see 21 what options are available for a low rise complex -- 22 MR. HIRSIG: I believe so, yes. 23 MS. YEE: -- without committing us to a low 24 rise complex? 25 MR. HIRSIG: I believe so. 26 MS. YEE: Okay. 27 MR. HIRSIG: Yes. MS. YEE: 28 MS. YEE: All right, Mr. Leonard? 10 1 MR. LEONARD: I want to concur with your 2 comments and suggest -- you seem to be suggesting that 3 we look for the lowest cost alternative and you're 4 assuming that existing high rises are probably that, 5 which may well be true. 6 If -- if you expanded the search area to look 7 at existing campus environments, it would be -- it would 8 like to like comparison, as opposed to kind of the 9 alternative of us going out investing in land and 10 building our own campus, which is likely to be longer 11 and, perhaps, more expensive. 12 MS. YEE: Right. 13 MR. LEONARD: But I agree with you, we first 14 start with like to like, what's -- what's out there that 15 exists -- it's reasonably vacant or we could get 16 possession? 17 MS. YEE: Right. Thank you. 18 Other comments? 19 Okay, do you need -- 20 MR. HIRSIG: No, I don't. 21 MS. YEE: -- a decision? 22 MR. HIRSIG: I believe the information that I 23 have is sufficient and I will move forward and ask my 24 administration chief. 25 I don't believe I need a vote or anything on 26 that. 27 MS. YEE: Okay. 28 MS. HOUSER: No, we're fine. 11 1 MS. YEE: Very well. 2 MR. HIRSIG: That should do it Madam Chair, 3 Members. 4 MS. YEE: Thank you. 5 MR. HIRSIG: We'll do so. 6 Thank you. 7 MR. LEONARD: Thank you. 8 ---o0o--- 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 12 1 REPORTER'SCERTIFICATE. 2 3 State of California ) 4 ) ss 5 County of Sacramento ) 6 7 I, JULI PRICE JACKSON Hearing Reporter for the 8 California State Board of Equalization certify that on 9 FEBRUARY 3, 2009 I recorded verbatim, in shorthand, to 10 the best of my ability, the proceedings in the 11 above-entitled hearing; that I transcribed the shorthand 12 writing into typewriting; and that the preceding pages 1 13 through 12 constitute a complete and accurate 14 transcription of the shorthand writing. 15 16 Dated: March 10, 2009 17 18 19 ____________________________ 20 JULI PRICE JACKSON 21 Hearing Reporter 22 23 24 25 26 27 28 13