president chiu: welcome to the board of supervisors meeting. supervisor avalos: present. supervisor campos: president chiu: -- present. supervisor kim: present. superivsor mar: present. supervisor mirkarimi: present. supervisor weiner: present. >> all members are present. president chiu: please join me

in the pledge of allegiance. colleagues, you should have copies of the april 15 and april 19, 2011 board meeting minutes. the motion to approve by supervisor elsbernd. are there any communications? if you could read our consent agenda. >> items 1 and two comprise the consent agenda. these will be acted upon by a single roll-call vote. president chiu: would anyone like to sever either of these items? if not, roll call vote. supervisor weiner: aye. supervisor avalos: aye.

supervisor campos: aye. president chiu: aye. supervisor chu: aye. costa-hawkins -- supervisor cohen: aye. supervisor elsbernd: aye. supervisor farrell: aye. supervisor kim: aye. superivsor mar: aye. supervisor mirkarimi: aye. >> there are 11 ayes. president chiu: please call items 3 through 5, as well as items 25 through 28, related to parkmerced. >> item 3 is a motion approving the final environmental impact report for the project. item four is in motion reversing the certification of the final environmental impact report. item five is a motion directing the preparation of findings.

item 25 is the ordinance approving a development agreement between the city and parkmerced investors, making various findings and waiving certain provisions of the a minister to code. item 26, ordinance amending the planning code to establish the parkmerced special use district. item 27 is a zoning map to reflect a special use district. item 28 is an ordinance amending the general plan by amending the urban design element height map with respect to the site. items 29 through -- these items were reviewed by the planning

department. president chiu: we had public comment earlier today on items that underlay the approvals. these items are in the hands of the board. supervisor elsbernd: let me start by thanking my colleagues for taking this issue up again. today is a real big day. today is a big day for parkmerced. today is a big day for district 7. today is a big day for the region. this is a regional project. this is a major project that has been in the public realm, in discussion, for nearly five years. it is finally coming to a tilt today. over 200 community meetings held not just within parkmerced but within the surrounding communities. neighborhood input. president input. significant public process of the last five years has brought

us to this point. i stand here today as the supervisor of the district in which this project would take place, solidly behind the project. and i want to support that point. you have a west side supervisor saying please add 5500 new units of housing west of 19th avenue. tell me the last time you saw that kind of thing happen. this is the west side of san francisco saying it is no longer appropriate for one side of the city to take all the development. we need to think about the city of san francisco not just in pieces, but as a whole. this is the kind of project we need to embrace. let me talk about a few of the benefits of this project. foremost, i think i spoke passionately about this in our closed session. without a project like this, at 19th avenue and the surrounding areas will never see transportation improvements.

over the last 30 years, those of us who have lived there for our entire lives have seen it get worse and worse. i can absolutely assure you it gets even worse over the next 30 years. i can tell you that. this is not just me with an opinion. we had the planning department look at the 19th avenue corridor study, which documents the fact of this issue. the area turned into a parking lot without this project. with this project, it opens up the door to the critical funding we need to truly improve chris protection not just for automobiles, but for public transportation in and around the area. you do not get the tier 5 improvements without peer -- without tier 4, sponsored by the developers. on the transportation side, this is such a positive. let's get to the crux of the matter. there is no question that the

most troubling aspect of this discussion, the most pressing, and that which has given me the most concern, and i imagine all of you, is what does this mean for the residents of parkmerced. the promises that have been made repeatedly by the property owners are promises of what is behind them that can give us the comfort in being able to tell us the promises are legitimate. first, we have the city attorney's opinion. we've heard that in closed session and the land use committee repeatedly. we have followed the letter of the law with all the court cases. we have made this as tight as possible. just earlier today, president chiu presented a written opinion by a former supreme court justice that this contract, this development agreement, is legally sound. i am comfortable.

i am comfortable with looking at my constituents and telling them these promises are legitimate. what is more, i want everyone to consider the reverse. we talked about what this gives to the tenants of the project. what about the risk if the project is not done? what about the pastures that are inevitable? millions of dollars have been spent on the property. not a penny of those has been passed through. even if you think there is a no- demolition alternative, i think we all agree the department's needs significant capital work. do you really think the work gets done without any pass- through stacks -- pass-throughs? that is absolutely determined. the bigger issue that concerns me, and this is something that struck me in my first few years representing this neighborhood

-- that is the way until the owner came on parkmerced was being sold off. all along holloway, san francisco state has bought. on the south end of the project, we have a vacant lot that has been sold off. undoubtedly, if there is a no- project alternative, that process will continue. what is the downside of that? one of the wonderful aspects of parkmerced is the nature of the community and the way, whether you are on the east and or no. and, it is what -- or the north anend, it is one community. without this project, the community goes away. that is not what i want to see for the residents of parkmerced. it is important the remain intact. on that front, we need to

address what it means for the city. if that bifurcation happens, if it gets split up, the city loses the ability to master plan the area. we lose all the transportation benefits. with the san francisco state example, what happens with them? they bought all those apartments. they bought all those parts of public. we lost all the property taxes. when san francisco state buys property, they are not paying us property taxes. they want to expand. they need to buy land. they need to buy these units. i do not want to set that up. i want the community to remain intact. i believe a lot of the amendments that were made earlier today really nailed that down. i will allow president chiu to

speak to those. i would ask you to think about the community not today, but 30 years from now. what do we need to do to make that part of the city a smart, wealthy part of the city? how do we move this city forward? supervisor mirkarimi: this is of order. it is done. >> i am a sick woman. please. supervisor mirkarimi: public, it was this morning in committee. i am sorry. this is not in order. ma'am, this is not in order. i am sorry. >> i cannot wait. supervisor mirkarimi: this is

not an order. you are going to have to sit down. please speak to your supervisor. >> supervisor elsbernd, i will talk to you. supervisor mirkarimi: if you do not respect our procedures, i will have to ask you to leave. president chiu? >> you can't sit on -- president chiu: thank you, mr. chair. colleagues and members of the public, i again want to thank you for the years of work folks have provided to this project. as supervisor elsbernd knows, this is a critical project in the vision of what we are as san

francisco. it is about smart growth, transit-oriented development, housing, and preserving and protecting rent-controlled. as a tenant, i have been concerned about the issues that have been raised by tenants around rent-controlled. many of us have spent days studying these issues and want to see them addressed. that is why earlier today, at 9:00, in our land use committee, i offered numerous amendments to make sure we are protecting and control and our tenants. i want to summarize the them for those who did not have a chance to follow what we did in land use. i have made developments -- i have made changes to our development agreement to make protections for tenants related to the transition that will occur as folks move from where they currently live into the new development. this includes compensation for any losses that occur related to losses of buchans' or patios,

extension of time for tenants to select a replacement units, improvements in moving benefits, as well as a strengthening of contracts during the construction. secondly, i offered amendments to ensure that as tenants are moved we require the replacement units be built on vacant land before anyone is asked to move, that we ensure that neighbors who live close to each other can be allowed to move together. i also wanted to address the situation that governs and that would assist our long-term tenants, who have been at parkmerced for 10 years or longer, who have lived in garden court apartments. we are requiring that several blocks of garden apartments not be demolished until the end of the project to allow certain long-term tenants to move into gordon apartments -- garden

apartments as they are vacated. 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