another set of trade-offs that we analyze, and this was important and negotiations is looking at what eliminating various components of the project benefits would do. the numbers that you see in this chart, as you can see, the project is solidly in the black without the financial burden. at the same could be said if we eliminate their rent control protection. as a less positive effect. if we eliminated but the committee benefit and the rent control protections, the product performs quite strongly and certainly attract equity investment.

what is interesting to note, the project is relatively -- those sorts of changes have been quite significant effect on the irr for a relatively small increase in public benefit. this does not mean that we cannot consider trade-offs, moving community benefits, or discussing which ones are asked. final considerations, the pro forma it is particularly sensitive to modest changes in revenue growth. if we think we have a strong couple years, the pro forma response well.

the public benefits package places substantial strain on the project, driving a below the market standard 20%. the city goal is to seek maximum public benefits without jeopardize the economic feasibility. there was an article that i feel focused on a few components of our report without looking at the entire report. what it says it is, yes, this project is on the margins of feasibility, but there are some arguments about why we think it negotiated -- we negotiated a good deal. our report, we attempted to be as objective as possible. moving on to a very brief summary of the draft fiscal and economic impact analysis. i think the most important

message here is this is a significant financial win for the city, both in the short and long term. specifically, the report breaks down the fiscal and tax -- fiscal impact on a development basis over 20 years. i will focus on the long-term build out fiscal impact. if you want, we can go into greater detail on the short- term. in sum, we expect the product to generate $17.5 million of annual net surplus to the general fund. during build out, in addition to the permit at $17.5 million net surplus, we expect $13 million to $60 million of one time revenue, primarily because of transfer taxes and construction payroll. finally, and surprisingly, the project appears to generate a

net positive fiscal impact on sfmta operations, ranging from $3 million to million dollars at annually, and is based i sophisticated model -- and this is based on a sophisticated model, improved upon by the ss mta finance division. they peer reviewed multiple versions of the analysis, and all of the numbers from that were derived for the eir. this is tightly integrated, and i could go into greater detail if there are questions. a broader impact numbers, the first piece was fiscal benefits. these are projected tax revenues for the city. there is also the larger economic impact for the city. in sum, this project we estimate over 20 years will bring about

$6.3 billion of hard and soft costs. it is a sizable sum, of which about $5 billion should have local economic impact. another $1.2 billion is primarily in financing fees. so about $5 billion is in the form of payroll and a hard cost purchases. it is things that have economic multipliers. it this investment results and about $7.1 billion of total construction activity, supporting both directly and indirectly approximately 35,000 jobs over the life of the bill out. that is over 20 years. after the bill out, we expect the project to bring about -- after the bill out, we expect the project to bring an additional $300 million of permanent annual economic activity, along with supporting

about 1600 direct new jobs. those are specifically and retail, maintenance, and other support services for mixed use project. a couple other comments on this. again, this fiscal impact study was based on the 20 year billed out, the same as the pro forma. remember that could extend to 30 years or could be shortened to 15, depending on economic conditions. the general fund costs were estimated from a service population based on the demographic projections of unit type, plus 50% of the projected employment population. it would look at the future population, and at best practices to derive unit cost per population. there are, for example, cost

for general administration, variable costs for increases in the city general administration, police, fire, 911, public works, libraries, and we included 20% cost constituency which it cost contingency, on top of the methodology used on shipyard candlestick. in many ways, this is more conservative than that project. that is my very brief summary of the substantial reports and i am more than happy to go into more detail if the of questions. -- if you have more questions. i will move very quickly through facing. -- phasing i believe that commissioner sugaya brought up a

review of phasing. in sum, the basic principle of this development agreement is somewhat unique. unlike shipyard candlestick or treasure island, where the city has money and land in the game, where in those cases we had very specific physical phases, geographic areas that are getting developed first, with particular improvements and the land uses and with a clock running on delivery, here where we have no city money and we are ultimately not giving any city land, we don't have any opportunity costs. this is entirely market driven. every dollar in this project at this point is a private dollar. in return for that, we were not demanding specific schedules or specific geographic build out plans, but what we are asking

for is when the profit development proceeds, what the city is given is very specific humidity benefits -- storm water management improvements, ceqa mitigation, commensurate with the density and the trip generation rates that are generated on the quantity of development that occurs. how was this regulated? it is through the development phase process. just a reminder, i have showed this chart a couple times. it is reminding all of you there are four levels of improvement. there is the master, basic approvals, all of the plans you are approving or may approve, there is the development phase, which is the next thing below that, and there are individual design review approvals, and there are implementing approvals, which are the street

permits, the building permits, things like that. we are dealing with the second- highest level of approval of the development phase. what the development phase does is it guarantees, again, that public benefits are phased in over the bill out. the development phase offers the developer considerable flexibility in the order, timing, as put forward in each development phase. it is important the size of the city retains complete discretion in terms of reviewing each phase to ensure its conformance with proportionality, proximity, and policy priority. in addition, to ensure that other concerns like integration into the existing systems or any public health or safety concerns are addressed. we're not yielding our discretion. we are able to review each phase when it is submitted, and there is a process outline to do that.

if an effective agency objects, they send written comments to the developer for corrections prior to the phase approval. this is a list of all the elements of the development phase application. for purposes of time i will not go into it, but i am happy to answer questions. the couple of new items that happened recently at it and we are in the process of negotiating, partially in response to the feedback. we have put in a maximum development phase. no development phase could exceed 2500 new units. the concern was raised. this allows us to least understand what is coming down the pike. this is particularly relevant for tenant relocation. we want the tenants to know far ahead of time which of the buildings are proposed to be eventually demolished and which

new buildings will be replaced over time. the development phases one vehicle, but we also want to understand the timing of cafritz improvement -- the timing of traffic improvement. we guarantee at least three the current applications. we are also the process of negotiating a minimum size. the point of doing a minimum size is to avoid piecemeal and, where there are small faces which would undermine the point of giving a projection the future. when we come back with a final revised report, it will include both a cap and floor. finally, given the feedback we have received from the public and some of you, we are negotiating the creation of the fourth "p" -- peace during construction. we have heard concerns about people worry about construction

noise and we're integrating into the phasing review process and criteria to ensure that existing residents are not overexpose to construction noise and disturbance. a very brief update on rent- controlled. i emphasize to the commission we had a massive presentation several weeks ago. i would prefer to focus on the topics tonight. just as an update, we are convening at the request of several members of the public and advocate and commissioners olague of tenant advocates, many of whom have spoken here. we will go into greater detail over the section 4 which regulates. control units and tenant relocation. the supervisor has agreed to convene that meeting in his office. that will be on monday, january

24, and i assume that commissioners can attend so long as we did not go over the requisite number. vice president olague: i imagine there maybe a couple of tenants. >> and as you know, commissioner, commissionerolague has taken the lead on organizing this. we appreciate your assistance in organizing the meetings. topics, this section is subject to ongoing provisions and improvements. we have received a type of constructive feedback. i think we are on our third or fourth set of revisions. we're focusing on simplifying the notification process, further clarified the definition of existing tenants, and ensuring that relocation

benefits will be available. we're also planning on posting a fourth draft, new draft of the dna on january 20 -- of thed.a. on january 20. it will be posted on the website so everyone can understand what has changed. >> there was the question of consistency in terms of policy.

just preparing a couple of slides in the context of other recent planning efforts and zoning districts. they've been adopted in recent years. this chart that is on the screen is to residential parking. actually, what we have done is organize the is an order from bottom of the chart to the top of the chart, but top of the chart being the most transit oriented and central districts of the city, but the bottom being the least. we feel that it is a consistent policy with regards to parking across the city. in all of these districts, there is no minimum parking requirement. you can see the allowances and parking ratios with special

commission approval, and the most dense districts in the city wheat all-out a quarter space per unit without commission approval. that as we go down the chart, as we move further out in the city, in concentric rings, areas of the city that aren't little less central and a little less transit intensive. the amount of parking that he could bill without commission approval goes up and park merced is comparable to ocean avenue and others. we would allow up to one space. in a with a special commission approval. just to recap, as we discussed

last time, parking is laid out more new wants to how the actual physical site lays out in terms of transit on the side. most of the parking is program for the western half of the site, while the density is located on the eastern side, closer to the streetcars and other dedicated transit service. overall, the project ratios are much more nuanced. in terms of retail, similar to the previous slide on housing, the downtown district has very tight parking ratios. that should be one space per 45 _ feet. it is much stricter than the rest of the city. as we move out towards the neighborhood districts, it

loosens up a little bit. park merced fits right in between. such she might find it showplace square or central waterfront. hunters point is the most permissive, and probably the least transit intensive place on this map. ii think commissioner a tinny asked about visitor parking last time. all of the parking is dedicated parking for residents were shoppers. there is a full street grid. all of these will have on street parking, on both sides of the streets. it is concentrated with perpendicular parking, but it is a very important component of the transportation program and there are existing, just under

1600 on street parking spaces, and this would increase by about 6%, 90 spaces, close to 1700 on street parking spaces. we have small parcels, that tend to displace one street parking. because this is a master plan, each block will have centralized parking facilities. there is probably on a per block basis more on street parking available in most neighborhoods in the city. i think we will jump straight through to a couple notable aspects of the sustainability program. we have talked at length about the transportation and land use

component and how it very much supports the overall goals of sustainability for this project and for the city in terms of reducing per capita vehicle miles traveled. a couple of the more notable components of the sustainability program relate to the water program and the energy program. there is a sustainability plan which you have received in your packet some time ago, and that document goes to great lengths laying out the quantitative metrics and implementation of the sustainability program, from waste and trash to construction, habitat, wildlife habitat, as well as things like water and energy production. this sustainability plan is very much tied to the ongoing

monitoring bill out of the plants. each has to report on how well the bill doubt is living up to the metrics. -- each has to report on how well the bill that out -- build out is living up to the metrics. you are familiar with the storm water programs, and returning flows to lake merced and reducing the overall flow into the source system. one thing we discussed briefly is the non potable recycled water program. this part of the city is in the city's recycled water ordinance area. there are very few parts of this, and that means that all billings have to be dual plumbed

for the valuable water recycling. this project in addition to living up to the legal obligation will be building not a distribution infrastructure for recycled water. that means when the streets are torn up, there will be putting in all the piping to eventually connect to the eventual water supply system which the puc is considering a the west side of the city on lake merced boulevard and tap into that and the future. the result is a very substantial reduction of potable water use, such that once this is fully built out, it will use barely any more potable water then is used today, because a very substantial amount of households and district water will be serviced by this non potable

water. as a very substantial ecological benefit to the project. the last component is the renewable energy program. i will let michael discuss the landmark agreement that has been reached regarding that. >> i want to emphasize that we are moving fast because of the lightness of the hour. in addition, we have negotiated a separate ancillary agreement that will govern energy use at the site. the sustainability plan set some goals that we have formalized in this agreement, specifically the baseline requirements of the project, that 10% of the project's energy at build out be generated from renewable

sources, new renewable sources, and assisting to existing sfpuc and pg&e mix. this would be a substantial improvement over the existing renewable energy mix. in addition the project has committed to and we will enforce and the development agreement that 10% of the project cost total energy consumption be generated through cogeneration, which is a way of utilizing waste heat and things like that from building operations to generate excess energy that can be recycled and provided back to the residence or documents of the buildings. finally, the sustainability plan speaks of the project's goal of achieving that zero non renewable energy consumption. the target here was to take the existing and she consumption, -- the existing energy consumption

and attempt to hold that constant. we are working on an innovative accounting system that would attract each development phase and allow us to keep tabs on whether the product is meeting its targets and then would have an incentive structure for the project to meet those targets. finally i would like to remind you of the sustainability plan sets ambitious conservation goals because we are aiming net zero. it is not just about producing energy but saving energy. this project has committed to exceeding existing title 24 standards, minimum 50% more efficiency for residential building envelopes, minimum 10% greater efficiency for all other nonresidential buildings, commitment to meet or exceed the

title 24 standards for any renovations, commit to exceed by 10% on new infrastructure performance. and then some other rather innovative commitments that are not code required, including installation of what are called vampire outlets which cut energy drain when people are out of buildings and ensure that the project uses the top tier of energy efficiency, energy efficient appliances, exceeding state requirements. these are all things this particular project sponsor a voluntarily proposed, and i think that deserves some recognition, although we have not focused on the component of the projects a much. with that, i believe we are open for questions. >> very good. -- president miguel: very good.

due to the fact that this is the report and informational hearing, and the lightness of the hour and the number of, cards, -- and the number c ofomment cards, there will be one minute per person. >> good evening, commissioners. my name is julien. i speak to you tonight in protest of the park merced development plan and the developers tenuous position. they have a history of dubious ventures that we're not sure of

their ability to finance this project. most recently it was reported that left the city of vancouver literally holding the bag at the 2010 winter olympics project. vancouver had to borrow the money to complete the construction of the public. i have the article here. i will attach it to my presentation. fortress is being sued for over 500 trillion dollars for mortgage fraud and its role in the subprime crisis. president miguel: thank you. >> is that it? president miguel: yes. >> i have my remarks here. >> we're having some technical difficulties with the land -- with the main microphone at the podium. if you could please use the shorter microphone on your