there have been issues about what happens in the small chance that the development agreement -- >> [shouting] please, please, please. you pay your taxes and -- supervisor mirkarimi: we are going to ask if you could gently beat removed. -- be removed. >> [shouting] let go of me. [shouting] >> come on, now. supervisor mirkarimi: all right. >> don't touch her. supervisor mirkarimi: president chiu, continue. president chiu: ladies and

gentlemen, we know this is a very difficult decision. we are having a discussion about the future of san francisco. part of the challenge we know is that if we do not do something and move forward today, we will likely see millions of dollars of tenant improvements that will be passed on to tenants. we can see large portions of parcels that are sold off with tenants who are unaffected. i think this is a very appropriate discussion for us to continue. there are a number of issues we wanted to address in the small chance that if the development agreement is not honored by the current boehner or by a future owner, or somehow the development agreement is overturned by the court, there are three things i asked our colleagues to amend. first of all, to include

lifetime leases between the parkmerced owner as well as with every existing tenant. secondly, to allow current tenants to have a private right of action, to be third party and fisheries to this agreement to enforce these procedures legally. most importantly, this contains liquidation penalties. if the developer or future owner fails to honor rent control provisions, or if there is some future court decision, the city can terminate immediately development agreements and collect the net present value of the difference between units with and units without rent control. right now, that amount is estimated to be almost $200 million as a fund for tenants in case anything were to happen. as supervisor elsbernd laid out,

this is an agreement which has been vetted extremely carefully by teams of lawyers around the bay area, including the former supreme court justice of the california supreme court who released an opinion today stating that under costa- hawkins this development agreement is sound, and it would uphold and withstand legal scrutiny. i know that emotions are running high. we need to make sure that as our city evolves and changes, we protect our tenants. i believe this amendment does that. supervisor mirkarimi: thank you, president. you made amendments in committee this morning. everyone here has a copy. supervisor campos: thank you very much, mr. president. let me begin by thanking the parkmerced community, who for quite some time have been going through a very long process of providing their input on this

project. i also want to thank the project sponsor in the planning department for all the time and energy that has gone into this project on their part. the last time this project came before us, the item was continued. my office agreed to facilitate a discussion between the two sides on this project to see if there was a way for us to find a middle ground that could address the concerns. the parties met in good faith, and i think in very good faith had a number of discussions about different possibilities, different things that could be explored to address the concerns that were raised, and specifically concerns around the protection to the tenants who currently live at parkmerced. i appreciate the work that president chiu has done in his amendment.

the amendment includes items that were essentially part of this discussion, items that were considered by the parties in trying to figure out whether or not a resolution could be reached. the tenant representatives in that discussion carefully looked at these items. for a variety of reasons, they have made it clear that as good as these items are, they are a positive development, they do not require this. there are times a party can do everything possible. i believe in this case, the project sponsor has tried to go as far as they can possibly go in terms of the current state of the law. but there are times when going as far as possible is simply not enough, because the law is in such a state that there is still a degree of uncertainty that as a tenant you may not want to

bear. that is the reality we have right now. we have a long process of negotiation that involves very good people on both sides who are trying to be creative. the reality is that to address the concerns about the enforcement of this development agreement. -- to address the concerns of the enforcement of this development agreement, all you can do is change state law. that is not before us. that is not an option. as much as a welcome the changes that have been made by president chiu, when we talk about tenant protections, it is not only tenant protections as we see them, tenants are saying what

they want. as a member of this board, i am willing to live with it. there is work that has been done by the city attorney's office. i do not think there is anybody in this room who can guarantee to any of these tenants that in fact the development agreement will be fully enforced. i challenge anyone in this room, to provide that guarantee. the former justice of the supreme court is a well- respected jurist, and i appreciate his input. but at the end of the day, the opinion that will matter is the opinion california courts provide. ultimately, if the matter goes that far, the california supreme court. the way i approach these matters is that i always tried to put

myself in the position of the people who will be most directly impacted by the project. i think about my parents and the kind of protections i would like to see for them if they lived in the parkmerced community. as good as the protections are, they are simply not good enough. good enough is what we are looking for here. i know that some have compared this deal to the trinity plaza agreement that was previously approved by the board. to the extent that there are similarities between the two, i do not know that i would have supported trinity plaza, given the case law that is currently before us. trinity plaza was decided before 2009, before a number of cases raised the question about the enforceability of these kinds of agreements. for that reason,

notwithstanding the efforts of both sides, i will not be supporting this matter. [applause] again, i want to thank both sides for their efforts. i do want to agree with most of what supervisor elsbernd said. i do think it is important a eighth to have development on the west side. -- important to have development on the west side. but the question remains -- are the tenant protection sufficient? i would respectfully submit that they are not. supervisor avalos: i want to thank supervisor elsbernd for his work on this over the years, and the developers as well as the tenants for their hard work on this project. i have similar concerns about the guarantees tenants are receiving in this development

agreement. i don't feel that i can support this development agreement, even -- i just feel a difference between what supervisor campos has talked about, between trinity plaza and parkmerced, is significant. trinity plaza was owned by one person. parkmerced is owned by many people. any one person who is part of that ownership who wants to back out could perhaps limit an agreement that could protect tenants. i also want to add another amendment to the legislation, if colleagues are willing to consider it. that is to strengthen the rent control provision that is in it. that is throughout the

development agreement to replace rent-controlled with "vacancy rent control," registered with the san francisco and board, with those rates being the rates the tenants are paying 30 days after the development agreement. we will be replacing rent control with "vacancy rent- controlled." that would continue throughout the life of the profits in -- the life of the property, indexed to consumer prices in the bay area. i can share a copy of this with colleagues, the language. this will take away the incentive to displace current tenants with below-market rents with contaminants with market- rate rents. it would also replace the affordability of replacement units. the rate increased tenants will pay moderate amounts.

the market rate increase has been 10% per year while inflation has only been 3% per year. this gives an opportunity to bring vacancy control to 1500 family-sized units in parkmerced. this will mean greater protections for seniors and families. it will bring 1500 permanent affordable units. we are allowing the demolition of two-bedroom units, against the long standing demolition policy to protect our housing. if this product is to happen, the least we can do is to mitigate the incentive to displaced tenants and preserve the affordability of the one dozen 538 units for the life of the building. -- for the 1538 units for the

life of the building. i stand not to support this development agreement, but i think if we are going to talk about rent-controlled for the future of the development agreement, this is language that i think is stronger than what is existing currently in the legislation. i will pass out a copy of this motion. supervisor mirkarimi: i think we may want an opinion from the city attorney about the ability to amend the development agreement. would that be ok with you? supervisor avalos: yes. supervisor mirkarimi: not the city attorney. >> the development agreement is a contract. there is legislation approving it. the board of supervisors cannot amend contracts. the board can vote them up or down. the only way a contract can be amended before approval of the board would be for both sides to be party to the agreement, to

enter into a new agreement with new terms and then submit that to the board for approval. technically, the board does not have the ability to actually amend the document without the consent of the parties. supervisor mirkarimi: a response? supervisor avalos: i could possibly request a continuance for the greater discussion on the amendment, which i think is a valid amendment to consider. supervisor mirkarimi: madam city attorney, there could be an amendment to the legislation, if not the development agreement, correct? >> the legislation approving the development agreement could be amended, but it could not be amended to impose terms on the parties that would be binding on them. supervisor avalos: so vacancy

rent control would be amending the terms of the agreement? >> if the parties both agreed to those terms, you would accept an amended agreement and the legislation would not need to be amended. supervisor avalos: without that agreement, no? supervisor mirkarimi: what is think about that, supervisor, and we will go to a couple other speakers. supervisor elsbernd: a couple things. i want to respond to supervisor avalos, but first to supervisor campos. thank you for the intellectual honesty in saying you would have opposed the trinity project. that surprised me. i apologize for my reaction. i hope you will continue to vote against any projects that approve below-market units. the legal argument you are making to argue this legal agreement is invalid is the same one you should be making to all

other projects, based on the city attorney's opinion. it was the exact same costa- hawkins question. not only is it comparable to trinity. it is comparable to any other project anywhere in san francisco that includes bmr units. you were sent to an -- you are saying to any tenant in those units that it is legally questionable. i hope you continue forward with any other project that includes one bmr unit or thousands. it is the same law. to supervisor avalos, i assume you know the value of the rent control subsidies already offered is $160 million. i am betting you do not know the value of the amendment you are offering care. i do not think any of us know. but it is not going to be $160 million.

it is going to be significantly more. i think we also know the developers are not going to say yes. it is a nonstarter. it destroys the entire project. let us not put on a sure way that this is an amendment that is coy to help move the -- not -- let us not put on a sure raid -- a charade that this is an amendment that is going to help move the project forward. superivsor mar: in a to three for our land use committee meeting this morning, we heard -- in a three to four hour land use committee meeting this morning, we heard pages of amendments from president chiu to increase rent control protections for the unit's scheduled to be demolished. i will say i think the planning department staff and others have

put together a wonderful project on paper that really is a sustainable eco-city in some ways, meeting our city and regional housing needs. i appreciate the efforts to protect rent control units and to offer power units to existing garden apartment residents. i also really appreciated the community hubs that are created within walking distance, and a lot of the sustainable planning that went into the project. but when it comes down to it, my visit to parkmerced and my history of working at san francisco state for 28 years, often being around the community there, i do see it as a viable, vibrant community with shared backyards and space. i feel very strongly that like someone said in the hearing this morning, the demolition of those 1538 units is equivalent to clear-cutting a community,

and existing place where families have grown up for generations. my visit to several houses and beautiful garden apartments, the human side of what we are doing to this development -- without considering and non-demolition alternative is a tragedy. i strongly support the appeal to look more closely at other alternatives. i want to see stronger language and protections of the rent control. i would like to seek a continuance so we can look more carefully at the 14 pages of amendments president chiu has offered. i will be moving to continue this item to look more closely. supervisor mirkarimi: it has been mentioned several times on the question of continuance, just looking over certain notes that should remind us that we

are at the deadline of being able to consider this plan. it is not at the deadline the general plan amendment texan. is that correct? >> the board has 90 days to affirm or reject a general plan amendment, after which point the general plan amendment would go into effect. one of the number of a dislike of items that make up this project is a general plan amendment. today is the last regular board meeting for the board to reject that general plan amendment. supervisor avalos: i want to propose my amendment. it does not make the project go away. it mitigates displacement. i have a question for the city attorney about the difference between what i have proposed here and what was adopted today

as amendments this morning. deputy city attorney cheryl atoms? -- adams? the question is the amendment i offered here, how that differs from the amendments that were adopted this morning in committee. those amendments adopted this morning did not have a mutual agreement from the different parties that were involved in the agreement. >> i will ask charles sullivan to address that. >> the amendments were actually discussed and agreed upon by the developers. the point of what sherrill said earlier -- cheryl said earlier is that this was a contract. the board can condition approval

of that contract. they cannot force the developer to address those -- to accept the changes. it would require that the developer consent to change the contract, ultimately. the question is are the changes being proposed something the developer would accept. if not, the board could pass a resolution approving an agreement that never enters into. supervisor avalos: since the developer has already accepted that agreement -- >> the developer discussed the changes introduced by president chiu and agreed to those. supervisor avalos: and on the tenants side, they do not have a say? >> we are entering into an agreement with the developer, not the tenants. supervisor avalos: that is some catch-22. supervisor campos: let me first of all respond to supervisor elsbernd.

that is one of the fun things about having all of these lawyers on this board. for me, in terms of deciding the level of risk or uncertainty that one is willing to take, we have to listen to the tenants to have been exposed to that risk. we have heard through discussions with the tenants that they are not willing to take this level of risk. granted, maybe others are more than willing to do that. i do have a question for the city attorney's office, if i may, through the chair. we have 14 pages of amendments that have been introduced, very sensitive and substantive amendments. i am trying to understand from a public notice perspective what the propriety of us in voting on these amendments is, given that

under the brown act, for instance, you have to give a reasonable person reasonable notice of what it is we will be voting on, the notice for this meeting for items relevant to this matter. it does not say anything about the kinds of changes that have been proposed. i am starting to understand legally the appropriateness of voting on these items. >> deputy city attorney cheryl adams. the notice is very broad. it discusses the development agreement and defines the project. while there are a number of changes proposed, all of those changes, from a notice in perspective, are covered by this notice, such that the board would not need to take additional public comment. certainly, the board can take

additional public comment, if that is the desire. but there is not a legal requirement to do so. supervisor campos: i am wondering if there is case law the city attorney is basing that opinion on. my reading of it is different. just a quick question along the same lines. does the city attorney's office consider these substantive changes? >> we often use the word "substantive" as a term of art when we are talking about making changes that might trigger additional review under the brown act ort sunshine act. i would not say they are substantive for this purpose. certainly, there are substantial changes here. supervisor campos: i guess i am trying to understand. what is the level of change or

substance that is needed for there to be a trigger of additional input? i am just trying to understand why a set of changes that into a hot -- that intel 14 pages of dense, complicated language -- that entail 14 pages of dense, complicated language would not require additional notice. >> i would like to point out the ordinance is not being amended by any of the changes in the documents. it is an ordinance approving a development agreement substantially in the form that was filed. we spelled out divisions in the text of the ordinance we thought would be of particular concern for the board. for example, one for replacement units, one based on costa- hawkins, all the things we thought the board would be

concerned bond. if one of those things were to change or work to change in the text of the ordinance before you, that could require noticing. but what you have in front of you is an ordinance that approves a development agreement substantially in the form of the board file. it is contemplated that the board might want to make changes or talk about changing. if the board and the developer agree upon those changes, it is appropriate for those changes to be made to the development agreement, as has been done in other major development deals. most importantly, the shipyard redevelopment project -- a number of changes were made before the board at the hearing. the important distinction here is we are making changes to an underlying document that is in the board file. there is a form of a delegation

substantially in the form. for purposes of sunshine noticing and brown records of this and, anybody who has been following this project would be familiar, and it would be reasonable to expect that these are the kind of changes that might be asked of the board at this meeting. supervisor campos: i am not going to go back and forth. i think i get the point. i think a statement that anybody who has been following this project would know this type of changes could be made -- i think there are a number of people in the audience who would disagree with that statement. but let me say this. i actually think that explanation is probably complicating things more and confused me more than it did help me. for the record, i do believe that we are running afoul of the laws that govern how these kinds of matters should be handled.

i do not think it is appropriate for us to take action on the kinds of substantive changes that have been made, is respected of what we think about the substance of those changes -- irrespective of the substance of those changes. the fact that parties have agreed does not affect compliance or non-compliance with public meeting laws. the fact that we may have done something with respect to another matter in the past does not change what we are required to do legally in this case. i still do not understand the answer. the first deputy city attorney who spoke about it records these changes as both non-substantive and substantive. make of that whatever you can. for the record, i do think this is a problem. thank you. supervisor weiner: