days in england and the the east coast. i think that this would be done with support and in conjunction with the maritime museum and it would be most appropriate to contribute to the display. we have a couple of other proposals for historical oriented type exhibits. i think that it is premature to bring them up right now. altering the possibility at the appropriate time. thank you very much. >> is there any other public comment at this time, on this item appeare? >> yes, i am fred sherman, president of marine highways llc and the marine commercial advisory committee. i am here to publicly asked the

leaders behind the america's cup event to lose it -- use their influence to select san francisco for this event. likewise, bmw, on larry oracle, they are premier players. the benefits to the city and the port will be great by having the america's cup here. therefore i would hope that mr. ellison, oracle's, and bmw would bring this event to the bay area with such significance in their business. thank you. [applause] >> any additional public comment? ok. recapping to get the next steps? >> thank you, commissioner.

the next steps with public comment first, after this hearing and your consideration of this action, the host city agreement is next going to be considered on december 8 at the finance committee before the board of supervisors. it will be the next opportunity for public comments as well, to be considered by the full board on december 14. so, with your permission, commissioners, there are a few items that i realized came up as a part of public comment that i neglected to mention that i would like to address them. the first has to do with the no. waterfront obligation in terms of longer-term leases being portrayed for structural

improvements. on the northern water from alternative they are expecting $55 million worth of structural improvements made by the team, the bulk of that would be structural repair. some of it would be essentially a gap for building a 4 inch shell for a new cruise terminal building. $55 million, what we are proposing as long term leases at 3032, different from the host city agreement. the first of those is that the first host city agreement obligates the city to sell the lot. we have softened that language, saying that we will explore the sale for 70 five-year leasing. -- 75 year leasing.

with bank credits for the $55 million or whatever the infrastructure ends up being. that is an important distinction. similar to the way the moratorium deal that was just signed the day of the parade -- we did that under those exact terms. there receive credit to mint -- commensurate to what was below the debt. i also wanted to address the timing issues that people raise. in terms of the holiday and the actual agenda when the materials went out on tuesday before the thanksgiving holiday, two of the advisory groups could not make it out until after the holidays. everything was properly posted when the meeting was announced.

i also heard some questions about the issues regarding what was brought by the maritime union in terms of foreign flag vessels. those issues can be addressed by the city perspective and it would be appreciated. >> thank you. cherry cullen. as i said, we are strongly committed to working with maritime unions to address this issue. seeking legislative and regulatory authority to make sure that we can have these racing yacht with foreign flags out of the race course. as well as the super yachts that will be coming. the folks down the boats, those spectators could be on the water. we will work with the unions that were here today and those that were not, we will work with the city attorney to make sure the language accurately

reflects our intention. we will resolve this prior to it getting to the budget committee next week. >> thank you. >> i am here to enter any further questions. >> questions, comments? >> we will start with questions and go back to comments. would you equate what we are voting on today to the dna that we debate -- that we typically do what they development? there is some lack of complete understanding to what we are accomplishing today. >> informally i would equate this to someone e betweenna -- a between ena and a development agreement. this commits us to -- you shall lea -- usually ena has a

term sheet, so this as an expanded term sheet. perhaps these are not the exact numbers are details, but the core principle of the transaction outlined here, subject to review in mitigation or other changes through the process, you have outlined at the core benefits to the city and obligations of the city to the port and the acoc. >> any other questions? comments? >> i would like to start off by thanking the mayor and his staff and the organizing committee for bringing this extraordinary opportunity to stand and cisco. as far as public comments today,

everyone wants it here and it is a great opportunity. there are a few concerns and i would like to caution you to study the need for peer 50. it will displace one of our largest maritime tenants. if we can find the best space somewhere else on the waterfront, it would be better if we could use that option. i am also concerned about the loss of revenue to the port. this is a great opportunity for the city overall, creating one of the best economic stimulus package is hopefully within the next one or two revisions, we will find a way to ensure that the port is

made whole or close to call in order to bring this extraordinary opportunity to san francisco. i also know that for the city, it is a great thing, but i did not see any community benefits for the communities that will be impacted by this coming, and there were some great suggestions of maybe finding portions of the blue-green way, or maybe even working with some of these nonprofits working with disadvantaged kids to fund some of the activities or have some type of special thing for these kids during the cup, so i would also like to hopefully see some kind of community benefit, but other than that, i think it is a wonderful community opportunity, and it would be great for the city. [applause] commissioner fong: a couple of questions and some general

comments, regarding the waterfront alternative, how do we treat cruise ships when we have a double header day? and we are far out enough to maybe try to schedule around that, but at least for the first 24 months, how do we treat that? >> that is an excellent question. honestly, we are trying to go the other way. we are hoping to attract cruise ships. it does put us in a position where there will be challenges to that, and we acknowledge that. i would say that. when we had a triple and quadruple headers now, there is often two ships, so there are some opportunities in the ultimate design -- it is not clear whether an east-facing earth is something that could be incorporated into the designs

for even at the briefing opportunities while the use them as the industrial bases, and i just want to point out pier 50 has hosted cruise ships in the past, so there are other opportunities on the port. we acknowledge these are challenges. we have set internally that having the challenges of having to accommodate so many maritime uses that want to come to the port is a challenge we are up for. >> thank you, and i just want to, for my own clarification and the public's, when i look at the tables, the central waterfront option compared to the northern waterfront option, from a dollar perspective, they are not quite side-by-side, but when you look at them side by side, they are huge in terms of cost. the central waterfront option -- by my rough calculation, i should be careful because we are

talking about millions of dollars -- a $39 million difference. obviously, the difficulty of moving tenants. but i'm curious, aside from the dollar, because that is obvious to me, time-wise, using pier 50 compared to 27, are we able to turn over a prepared site to the america's cup group sooner at 27 or 50? >> i think those are also excellent questions. in delivering any site where major changes are going to happen is a major challenge to hit eight open for business in 2013 schedule. we need to all of knowledge that this is going to take a lot of effort from all of us to deliver this. we believe we can do it, but it is going to be a challenge. two, pier 27 is further along in that process.

we have schematic design keyed up for improvements, talk about having done a lot of the community outreach and some of the work that has to happen to move a project forward. i think that is definitely an advantage. overall, the concept of using on the northern waterfront more likely to target six months of use arawn the event is inherently helpful in meeting those timelines. pier 50 adds additional steps of preparing the site as significantly more complicated. there might be some removal at pier 27. first of all, we have studied it more already. not only is there should removal, but there is significantly more removal. there is a for your sheds to remove. any number of tenants that need to be relocated, and moving the

port maintenance facility while keeping it functioning, which i'm sure will be integral to these actual plans and moving forward in infrastructure, keeping that open a while we are moving them will be another challenge. commissioner fong: ok, just to clarify the sort of when-when using 27 is that we get down the road as far as cruise ship terminal construction, and when he races are completed, we are at least through stage one of construction? >> yes, i think there are two scenarios we envision. the scenario we are currently advancing and we are currently optimistic will work within the timeframe and provide an amazing grace home, will be to proceed with a new building at 27, demolished the entire 27 non- historic shed, demolished portions of the peer-29 shed that are already degraded when the two were connected many

years ago, create a platform. theoretically, you could stop there. it will create places for thousands if not hundreds of thousands of people to view the races. that is one option. another is to continue right along and complete a new building that they can use in its raw form for the america's cup races. essentially, in some ways, you think about these venues. people create venues like this on a temporary basis even for a month-long event, and the question is how far along we have to get to serve purposes for the race and the authority. that is the question that has to be worked out in detail, but any step we take a long entitling those things, doing the demolition, building the new core shell, all those are major steps in delivering a final pier 27 cruise terminal. >> i'm supportive of approving

this agreement today, and like many people in the room, i have been fortunate enough to have been on the san francisco bay. there have been many times where i'm sure it is sunny or maybe the fog is rolling in, where you say to yourself that not that many people are out here and people ought to see this. growing up here on the bay and feeling that it has not been utilized to a full degree, this has been a fantastic opportunity investment for us to open up the san francisco bay and the waters and the enjoyment and benefits that it brings. so i congratulate all of those who have worked and saved the best part of the heavy lifting still ahead. thank you very much. good work and thus far. so we do have a motion unless there is any other comment or discussion. >> may i? i just want to also be on the record as thanking everyone involved for the efforts that have gotten us here today. a couple of people step up and

cautioned us to slow down or try to take a little bit more time, and this is one of those situations where we do not have the luxury of time and you have to seize the moment. i think it has been commendable what has been put together in pretty short order, not the least of which has been the analysis that has been done, and i particularly want to thank port staff for another excellent report that has been mention, really pointing out the solid numbers and the pros and cons, and as you look at those, you realize that there is never a perfect solution to anything. so you need to weigh those, and i think i would like to weigh in with my fellow commissioners that if i had my choice and if i were voting on one option, it does appear to me that the no. waterfront does in the long run benefit everyone the most. i think we do not want to do any harm, and i tend to see and low

potential harm if we end up with more, and i think the no. waterfront has so much longer term potential, and i think also will have that minimal affect on so much of the work that has also been done over the last several years to provide the court with options going forward, and i would hate to see those impacted because we do have to look out very long-term, and we do still have multi- billion dollar needs at the port, so i think we have some answers that really can address every aspect of it and bring benefits to the city, the port, and the bay area if not beyond, so thank you all very much for getting us here. [applause] >> commissioner, could i review the resolution has proposed to

amend -- i just want to say that the resolution authorizes -- essentially urges the executive director to advance the board of supervisors to host city agreements. it should note in the fourth resolve clause, it notes that in both of these in regards to dredging, there are some calls out that dredging is part of the city's infrastructure projects. it moves it forward, removing dredging as part of our infrastructure works and moving it to the works of the authority, and further, the actual amendment to the resolution authorizing -- adding the language of saying, "do not materially increase the obligations or liability of the city of the port except those

offset by a commensurate benefit to the city and the port." i just want to say it was a privilege to represent the myriad of the court and city staff that have been here today. i want to thank everyone that has been working to make this happen. commissioner fong: great. thank you. those in favor of the resolution as read by the court staff -- the port staff? ok, resolution 10-73 is approved. [applause] >> thank you. ladies and gentlemen, we have one more item and then we lose this room, so if i could ask you to quietly move on out. we need to hear our next item. we would welcome discussion with you in the hallway as soon as we are done. thank you very much.

>> richard berman, if you could come to the podium if you can even get into the room. rich. excellent. we will have a maine call the item as soon as karen is done monopolizing our quorum. >> item 66 -- 6a, request rescission of resolution 08-61 approving a first amendment to the lease with darling international for premises located at sea wall locker hundred 44 and request approval of modified first amendment to

expand permitted uses to include construction and operation of it by a diesel production facility in compliance with a port- approved operations plan and adopting california environmental quality act findings. >> good afternoon. i'm a regulatory specialist with the port's real estate division. this is a matter that has come to you in the past. we are talking about the darling biodiesel facility. the lease was approved in 1996 and extends through 1998. deventer fats, oils, grease, and animal by-products. in september 2008, the port commission approved an amendment to allow the facility to expand its use, and that would include the production of up to 10 million gallons a year of bio diesel. the highlighted terms i want to remind you of from that, amendment included certification for the facility under national

by a diesel standards, clean air act standards, insurance of grits, letter of credit of security for $500,000. importantly also an operations plan which was not required previously, and that included specific components that addressed concerns in the community and management plan and abatement and upgrade plan, and that was approved with the expectation that the city planning department would approve it with a categorical exemption under ceqa, which was actually something that came to the four -- fore. before the lease was finally executed, there were some details to work out, and before that was executed, the bayview/hunters point community advocates filed an appeal. the results of that appeal included a planning commission

recission of its original categorical exemption and the results of that included the nullification of the port commission approval from september 2008. in april 2009, staff came before the commission and notify you of that appeal and the results of that. the planning department of the city then agreed to again analyze the project. during the process or during that time, the response was to convene a series of community meetings. the port process included three community meetings. one in june 2009, one in october 2009, and 1-april 2010. the first meeting was a review in the community of all the regulatory agencies that play a part in overseeing the operations at the darling

facility. they included the us epa for oil said it -- oil storage. they included the quality district. the department of public health for hazardous materials issues. the san francisco puc, and each of those agencies spoke and presented the kinds of issues that they address when they provide that kind of environmental regulatory oversight. once that was done, some other community issues were raised. the most important one was some concerns about public health risks associated with exposure to odorous emissions from the plant. so we left and prepare for the second meeting with that in mind, that we came back and at the second meeting address fire safety and planning issues, address building permit process issues, and the port came back with a consultant who is a specialist in odor emissions, had been a regulator, and was a certified engineer.

darling brought an environmental toxicologist, both of whom stated that there was no evidence that emissions from a plant like this would lead to public health risks. nonetheless, the concerns of the community remained, and at the second meeting, darling agreed to conduct a systematic evaluation of the health risks associated with those zero risky missions. that involved the preparation of a health risk assessment, so darling hired some consultants who prepared a draft sampling, and those plans were reviewed by the court staff, by department of public health staff, and by the community. once they were approved by all parties, darling with a head and sampled the emissions from the plant and took the data and used it to run a health risk assessment. the health risk assessment was reviewed again by staff with the assistance of staff who are experts in the area, and it was also shared with representatives

of the community. the conclusion of the assessment was that there are no health risks -- public health risks associated with the odor is emissions from the plant. the health risk assessment is on file with the executive secretary, and a copy of a summary evaluation was provided in your packet. at the third meeting, we presented the results of this health risk assessment and address some concerns that resulted from that. the community had been provided the report in advance, so they had the chance to review that. they came in with questions. we address those, and by the end of the meeting, there were no further questions, and it was clear that all the questions have been addressed, and we felt like we were ready to move on. at about that same time, the ceqa process was wrapping up. the ceqa staff performing the analysis had attended each of the community meetings and had been given copies of the health risk assessment, so they were

working from the southern waterfront final supplemental impact report. on july 22, 2010, they issued an addendum with respect to this particular project. they found that there were no supplemental or subsequent environmental analysis required, that the project would not cause new significant impact, and that there were no new mitigation measures necessary to reduce significant impact from the proposed project. we then went ahead with darling and finalized the agreement. we were working than with a modified first agreement. again, you had approved a modified first amendment. the basic differences between the first amendment and the modification are outlined in the staff report. the one that i would call out are that the original required that they use biodiesel in the

fleet. the original required that there be a process for dealing with the odor complaints in spite of the improvements that might be made under the original agreement. the modification required a corrective action plan that would be prepared by dialing consultant but also that the plan be submitted to the community the a the president of the swak or his or her designee and that the darling team be prepared to meet with that person to discuss the corrective action plan and that we incorporate community comments into any corrective plan that was the result of any ongoing patterns of odorous emissions. the final notable difference between the original and modified first amendment were the the emergency notification for the amendment required