mission of that agency, and an even better, which announces an event which will benefit a government agency or charitable nonprofit organization and that will take place on publicly- owned property within the city of san francisco and further a public purpose. banners would not be allowed for political purposes or for general commercial advertising. as for duration, banners would be permitted for up to 50 days or until five days after the day of the sponsored event. banners could be reinstalled for an additional 50 days after they have been off for 70 days, and the port's executive director could allow placement of banners were greater than 50 days, so banners will convey a clear message and avoid visual clutter, all polls within a single block would be limited to a single banner, or banner permits are for four blocks. both the city and port currently

impose fees only to recoup administrative costs for operating the program. the port does this through the permit process, using dpw's established schedule. staff recommends continuing this practice. in addition, we have investigated charging the proprietary better fee, representing a reasonable rate as a revenue source that will be on the staff cost of administering the program. a proprietary fee would be for the privilege and use up for property to hang banners that promote a non-commercial event, as defined in the criteria, by a tenant or nonprofit organization, and could be promoted by a corporate sponsor. examples of banner's where there could be a proprietary fee are the san francisco giants advertising their presence at home games, various non-profit and banners such as the variety of benefits at a kind for property, an exhibit opening at a museum or the beginning of the ballet season. staff repair market comparisons with the airport and mta to test

the structure as an example of proprietary fees asset that it dollars for a banner per 50-day placement, a rate well below the anticipated market value of the space occupied by each banner. staff plans to conduct a study to determine the market value for the banner of four streets, and if it appears to be a feasible source of revenue, would bend to the commission for its consideration. following this informational presentation, staff will return to the commission for consideration of adoption of the criteria without a proprietary fee. at a later date, staff may also return with a proposal for a proprietary at the. that concludes my staff report. i'm available for any questions you may have.

>> thank you. first of all, thanks for doing this. i think it would be very useful and i would think make it easier, too. i have a series of questions -- who installed the banners? >> when an applicant wishes to install them, they hire a banner company that does it. and the better company than files for encroachment permit, which boasts the necessary insurance and meets the requirements of working on for property. >> ok, so the insurance kicks in with the permit. ok, that was one question. i did not really understand the terms section, the 50 days and 70 days lapse. is that based on some experience? what was magical about those numbers? >> the purpose for limiting the length of banner placements to 50 days, and that could be a different number. it could be 70. it could be 40 or whatever -- is

to maintain a freshness to the waterfront. banners are something that are up there. they are signs. they move in the wind a bit. and to create a lively freshness to the waterfront every time a visitor comes for every so often, these change, and the appearance changes. we have been testing this better criteria for the past three years and then using that number, so it has been a model that has been working. it certainly could be a different number, and the same intent of after 50 days, you have to be off for a while, and you can bring that back, and it would appear fresh again. >> ok. so 50 seems to work, and 70 just seems like a nice, intermittent time. ok. i was also confused about the placement on the blocks. you describe it one way, and i am reading it another. it is not clear to me at all the

way this is written, how many can be on one block or not be or have any banners. and that a change we made a couple of years ago as we were testing this out is we began to require -- allow only one permitted per block. at one point, we would have three different ones within a block, and the study to look like confetti. you would not get a clear message of any single banner committee coming through. we also found that not all poles could accept banners. divisibility of streetlights or conflicts with some of the arms that service the muni lines. even though there are about 20 calls per block on average, and you could put two banners on each one, and in reality, it does not come out to that number. sometimes well, sometimes 14. once in awhile, it is down around eight. there is a limited number.

we encourage applicants as they come in to fill the entire lock, and that is how we have been administering the program. >> the main goal is to have one for block so you do not have this double. >> correct, and have a visual punch to their program by repeating the image. >> in the maintenance section, it says the banners should be removed repair immediately -- okay, so once that thing goes up, all the responsibility is on the committee -- permittee. >> correct. and i would like to say we have not had trouble with people removing their banners. other than that, it has been very successful. we have not had maintenance problems. we have not had to chase applicants down to do that. >> great. thank you. >> that has been our experience. >> thank you. just some questions with respect to the fee being

charged. would it be a standard fee, or would be there -- with there be any great nation? >> would you clarify which fee? we have a processing fee to administer it, and there's a possibility in the future of a proprietary at the. >> can you go over all the fees? >> ok. right now, public works and the port bow charge an administrative fee to handle the staff cost of administering the program, and it is a minimal fee. probably does not factor in the time required to maintain the program, such as developing standards, but it does require the inclusion of permit process -- encroachment permit process that goes into it. i'm sorry i did not have the numbers with me at this time. it is not very significant. the board adopts the public works these scheduled to that. the other at the we're proposing to study would be a license to use port property, saying that

this is valuable commercial advertising space, and should we pursue looking at this as a revenue source, and raises the question of with these applicants be willing to continue the use of this. we have looked at some of these schedules at the airport. they have had a commercial banner program. or a commercial sign program. throughout the airport, and a contract with clear channel is quite significant, and they have set rates on this and a way of administering it. the airport space is very different than ours. we have done some market analysis, but we feel we would need to have an outside consultant to a detailed analysis to determine the value of these spaces. >> just want to clarify the vernacular. the licensing fee is more like rent.

what did you and to count -- more like you run into constitutional problems. >> we do not charge a licensing fee. >> and there would be the ability to charge different types of applicants different fees, should it be the preference of the commission at that time. rent. every time i said at the, i meant rent -- every time i said fee. >> what happens to the scuffles and do not take down their signs? what is the penalty for that? >> at one time in the draft we had written, we were suggesting imposing a fine. because it has not been a problem, we pulled back out. public works does have a fine system, and if we put one in, we would have to go to the board for an ordinance, i believe. what we have in here now as if

there are continued problems with this, it would require posting a bond, and the executive director could ask for a $25,000 bond to see about this. there are a limited number of companies that install banners. i think they all wanted to do business again and again, which is probably why we have not had a problem. >> and of course, charging bid is an incentive of the town. >> yes. certain days. >> would there be a hierarchy of renters if two wanted to come in at the same time? would it be first-come, first- served? >> we might address the question by telling you how we administer the space on the embarcadero now. we keep some charts based on a month by month that when we get an applicant, they can come in -- they must show up at least two weeks before. i cannot remember the exact number, but two weeks before and

not more than 120 days before, so we are able to keep our accounting set, and we assign it -- we try to match the location of the event with the location along the promenade. there is a statement in here that says or sponsored a waterfront event. i do not have the exact wording. would get preference over city- sponsored events. we can develop in the spring. we had a very quiet month in january, february, up until about mid-march when it comes in. if it became much more popular, it could become an issue. right now, it seems to balance out quite well, and we are able to keep, i think, pretty much everybody satisfied and able to find a place for them, although not always their first choice. most applicants want to be right in front of the ferry building, and there is only one right in front of the ferry building at a time. >> is there a limit to how long

they can be there now? >> we are administering it as it is proposed here, 50 days. then they must come down, which is seven weeks in a day, which also works with the way and installer functions. they put them up on a monday and take them down on a monday. >> throughout the city, there is no rent being charged for a better? >> correct. >> that is interesting. a cross between a thousand dollars and $10,000 to hang them? does the money go to making the banner? >> yes, it goes to fabricating the banners and the company that fabricates them also does the installation, sends a truck out and does the install and the de-install. that is where the real cost of cutting benefits of this. the fee paid to the port or city is very minor compared to the actual cost. >> then, do we refer people to

better companies? >> no, we would not do that. they are responsible for finding their own. >> hopefully, you can come back with the fee. >> rent. levy >> on banner content, under the design criteria, will there be any kind of prohibition or review? i guess that goes down a slippery slope. >> these criteria state that they encourage a clear display of the message, which i do not think is quite addressing what your comment is about. on our to do list, when it comes back in its final form, is that add a little bit of language, particularly if we charge read,

that would limit the content to limit alcohol and tobacco advertising and some other things as such. you do not see that in here today. >> and then, there is intent to allow a listing of corporate or commercial sponsorship. >> the sponsor is allowed to occupy 15% of the better area, and that is consistent with the city's public works code. >> is there a higher rent charged for those who do that? >> we will have -- when and if we do come back, we will have the option -- or there is the ability to show more than just one rate, but to breakdowns and what not. again, it is not commercial advertising. it is for any event, and the sponsor is incidental to what is listed. they have a commercial purpose, we get into something very different that would require an

ordinance. >> currently prohibited. >> unless there is a local opera -- permitting it. it relates to a proposition passed in 2002 that prohibits advertising except on public streets, where permitted by a low laugh. i hope i said that right. -- were committed by a local law -- were permitted werewhere -- where permitted by a local law. >> sometimes we have banners, and very rarely, but every now and then, are they -- commissioner brandon: is there any public comment on this item? thank you. >> item 8b, informational

presentation on the determination of fiscal feasibility for the genes are herman cruise terminal at pier 27 and ne work plaza project. >> good afternoon. this is the item with regard to fiscal feasibility for the cruise terminal project. -- northeast wharf plaza project. >> good afternoon. this is the item with regard to the fiscal feasibility for the cruise terminal project. hang on one minute. i'm from the planning development. i am also part of the team looking at the cruise terminal project. the item relates to the fiscal feasibility requirement by the

city. on the next -- whoops. i knew this was going to happen. there is a fiscal feasibility requirement. chapter 29 of the city's administrative codes require certain city project be subject to physical disability, review at the board of supervisors before the city planning department can commence on environmental review under ceqa. i want to make a clarification. the staff report should have said that it applies to projects for which one implementation and the construction costs exceed $25 million, which the cruise terminal does, and at the time of funding for ceqa review, a portion of the pre-development planning or construction cost is in excess of the $1 million

excluding city personnel costs, will be paid from public moneys. we have filed this report, the staff report with the city clerk. it should be held with the budget and finance committee on may. there are two underlying principles or questions under fiscal feasibility, which is, one, how is the court going to fund this project? and two, what are the city benefits? with regards to the funding, i will talk about that, but you need to talk about costs first. let's quickly review -- i know you have seen this before, but what the project is -- this is the existing site of pier 27. what we propose to do is demolish pier 27 shed. that portion of the pier 29 shed, the non-historic portion,

as well as the pier 27 office annex building, which is the -- i do not have a pointer with me, but the small building along the embarcadero next to pier 27. that will be, if all goes well, miraculously developed into the new cruise terminal project, and per the host city and the new agreement, the event of authority is required to demolish pier 27, pier 29, as well as relocate the short side power equipment. this allows the port to come in as what we're calling this one in 2012, to build or construct the shell building, which is noted here. the event authority is then given exclusive use during 2013 for their races. in 2014, the site is returned to

the port so that we can finish the phase two construction, and that relates solely towards the -- making it an operable cruise terminal facility as well as competing improvements. as i was mentioning, the funding for this budget really relates to what the cost art. -- what the costs are. the prevailing costs are what has been estimated four phase one as $65.7 million. that includes the event at 40's portion, which is heard the host city -- that includes the event then you -- venue's portion, which is per the host city.

as ken mentioned two weeks ago, this was done as a result of reducing the project cost by about $16.5 million, shipping some costs, about $11 million, from phase one to phase two, and identifying additional funding for the project. i do not think anybody can see this, but this is the funding sources you have seen before. it was in the staff report two weeks ago. it was in the staff report to the board of supervisors, but it talks about what we are prescribing for the phase one and phase two funding sources, and is divided into plant and proposed sources. i will not get into it directly, other than most of the funds in phase one car for the watermark condo sales proceeds, and the revenue bonds, which have already been issued.

the phase two proposed costs include the 2012 general obligations bonds that would have to go to the vote of the people. $9.1 million would be directed toward the northeast wharf plaza. below that, the $2.75 million, which is now called the cruise operator contribution. that would be dedicated for a mobile gang way system. those items are still proposed, and they are in the works. which leads us to where we are in terms of project costs and funding. we think we have -- we have had a strategy to complete -- we have complete funding for phase one, but for phase two, there are still about approximately 8 $12 billion debt. there are some strategies, but

we are not there yet, but we do have some options. the first would be to review opportunities to generate additional revenues, including special even usage, parking, and commercial leasing within the pier 27 site. we would consider further reductions as long as it does not negatively impact performance standards. we would try to identify new sources of revenue, including grant funding or other sources of anything we can find. we would select components -- project components that are in the project now that possibly we could differ at a future date, and finally, reallocate and use funds from other capital projects. as the process goes forward, we will periodically check in with you as to what the project

funding, the project's cost will be, not only with regards to phase 1 project, but especially with regards to face two, since we have a funding gap. the other question that i mentioned earlier is what are the city benefits? this is based on an economic study that was done in 2008. this assumes the the cruise industry brings 200,000 passengers each year to the ports, and the passengers and crew, this project would generate approximately $300 million annually in direct economic activity to the city and would support approximately 400 jobs within the city. it also generates approximately $1 million annually to the general fund. in a more qualitative sense, we believe the city benefits by

one, enhancing its reputation as a tourist destination. two, it increases demand for maritime businesses as well as maritime employment, particularly with the synergy between the cruise terminal facility and the dry docks at pier 70. it continues and integrates the improvements along the northern waterfront, including the exploratory and project, and finally, it will serve as a lasting legacy for the 34th america's cup, and we hope to use the cachet with the america's cup for future use at pier 27. the next steps -- again, i mentioned a four, we go to the budget and finance committee for fiscal feasibility. we are in the process of selecting a construction manager general contractor. that process is under way.

the rfq was issued two weeks ago. there was a previous meeting last friday, and we'll get back to you for consideration for approval of the contractor in the june meeting. the design team is very busy doing the design development drawings. we hope to complete them by july. we will check in with you with regards to that. after that, the construction drawings hopefully will be completed by the end of the year. on another parallel course is ceqa. the idea is to complete ceqa by the end of the year so that we can start phase one construction january 2012. that is all i have for my report. there are any questions, i would be happy to answer. >> thank you. is there any public comment on this item?

that a couple of questions. i'm curious how many people showed up at your bidder conference. >> i would say about 20 people, probably representing 12 or 15 firms. everybody you would expect to be there was there, so it was very good interest for this project. >> the ceqa for this project is separate and apart -- two heads nodding in different directions i'll hear your answer since you are at the podium. and then maybe you should finish the question. >> i think i got it. but question is is the separate and apart from the ceqa for the america's cup? >> robert may have to help me. but there was a notice of preparation that was done for

the america's cup and the cruise terminal eir. those should be done working together. that should be completed in november of this year. >> [inaudible] if anything happens to it? that's absolutely. yes. [laughter] -- >> absolutely. >> it is not something i really know the answer to at this point. >> we have hired one consultant. the port is paying the sheriff for the cruise ship terminal analysis. the america's cup budget will hopefully pay for the share related to the america's cup, assuming that there is a budget approved by the board of supervisors here it whether it ultimately is a single report --

i do not know that we know that yet. but in terms of -- there is something under ceqa called and adjacency will, and for that reason, it is being studied together. -- adjacency rule. >> i do not know how easily you can get back to your slide on the funding sources, but it did not quite match up with what we have in our report, and you went through it fast enough that i could not tell if it was just that it was based or we have a table 3 on page 9 of the report, and a quick passage through could not match. >> i thought that a stable four. >> it was tabled two. >> no, it was not. it was tabled four, i think, that he shed