order to get to deeper water, and then selling off time the lands that were -- tidelands to create a better waterfront in san francisco. these lands were ultimately acquired by the predecessor to pacific mills. union ally in works. they became one of the greatest shipbuilding companies on the west coast, perhaps the greatest. and this is where it all happened. those lands we know from well- developed case law, are free of the trust. at least the ones that are filled. you can see one area that was never filled, despite their private ownership. so there is a little bit of a

question mark as to the trust status of those lands. so everything in yellow, including, surprisingly, the streets. those lands were all confirmed within the ownership of the trust. consequently, those plans were never conveyed to the port to the state under the burton act. the remainder of the site is historic up plans. those are adjacent to what had been the pacific railway mills property. ultimately, pacific railway mills sold that property to [inaudible] iron works. and they were another major producer of iron, had a major

facility. ultimately, as brad mentioned, that was acquired by the federal government during world war ii. the federal government held the property until 1967, at which point, it was acquired by the state. we are not sure why it was acquired, but we know that for -- from record that it was. one year later, the state transfer that property under the burden act to the port. that is why the port is holding a major area of historic up plans not subject to the trust. these lands are subject to the burton act, which is why they are not being sold into private ownership. but the burton act pressure actions on the use of those properties can obviously be modified by statute. that is one of the main reasons

we have moved forward with ab 418. this is a composite picture of what the trust looks like on the property today. hot on the bottom you see land subject to the trust, including land pretty distant from the waterfront. you also see st. areas that were never conveyed by the state to private ownership, subject to the trust, to the port by the burton act. the yellow and gray are the area that we believe are not subject to the cost today -- trust today. the remainder, there is a dispute as to what rules govern their. it was required by the port, supposedly with trust money, but it was only $1.

suppose the bay, that came out of eugene gartland's pocket. so the port may not have to spend even $1 on the property. as you can see, a great deal of the waterfront itself is not in the trust, according to this that -- map. whereas back plans are shown in the trust. that is why this property was calling for the change. here is why -- what we think the trust should look like on the property. had the green area is what, at the end of the exchange, would be in the trust. one is in yellow would be out of the trust. and when we take this trust out of the land through the exchange, we would be worth -- removing all of the restrictions imposed from the burton act.

those lands could be sold by the port. they could be leased to private owners and they could be used for any purpose presidential, commercial, office, thing that you are typically prohibited from doing on trust land. the green is maintain the existing ship facility, series of waterfront parks, along with a couple of key street access ways that allows the public to get to the waterfront under this proposal, the trust actually comes out ahead in terms of acreage. i just wanted to point out one other aspect of the bill that makes ab 418 important. there are some major historic buildings close to this site.

normally, buildings on trust lands are subject to the same use restrictions as other trust lands. so the state has been a bit more flexible. those buildings are pre- existing, and they do not want the space to go to waste, but they are still reluctant to allow uses other than trust uses, even though the cost of restoring those buildings are often astronomical. what we have done here, the red buildings are the historic buildings that are actually on trust land, where we have provided some flexibility in the statute to allow non-trust uses so that the public can access them, ensure that they are returned to federal standards set forth by the secretary of interior. but some of the key historic

buildings are in yellow. they are not shown it in a different color on this map. in those building we retain complete flexibility to use the inside for any purpose, whatsoever. that is really going to assist the port in the renovation and preservation of those buildings. that is all. thank you. i am here for questions if you have any. >> thank you so much, bill. the only thing i would have to correct from the presentation is that i did not prepare the maps. i would like to thank my staff for producing those fabulous maps. i just want to go over a few of the other requirements of ab 418 related to pier 70.

a lot of these are standard requirements for any trust exchange, so they are not unusual. the lands coming out of the trust have to be found useless for trust purposes. the monetary value of land added to the trust must be greater than or equal to the value of those that are removed from the trust. the exchange cannot interfere with trust uses. at pier 70, the example is we are preserving that ship repair function, enhancing it through the master plan. land impressed with the trust must provide a significant benefit to the trust. examples of that could be the shoreline parks that are being created at pier 70 that will provide great public value and appreciation of the day -- bay. remediation issues needs to be

addressed. karen has been working with the water quality control board, doing a state investigation of pier 70. the requirement is that you have a remedial action plan approved by the regional board before the swap can happen. state lands is there to make sure the trust does not received land that have no way of being cleaned up and used effectively. both the state lands commission and city must approve the exchange. after the bill is adopted, if signed by the governor, we would be back in front of the port commission with a final proposal based on some of the work you have seen today. also, the board of supervisors would have to weigh in. the state lands commission does a lot of titles survey work associated with the exchange to make sure that everything is legal.

a few of the other unique portions of the bill. the port could continue to hold non-trust lands at pier 70. this is unusual, really. after a trust exchange, the assumption is the grant to will sell the non-trust lands. actually, it took a lot of creative work with the state to get them comfortable with the idea that the port would hold these lands. one of the ways in which they became comfortable with the idea is that revenues from the non- trust areas would go into the carper fund. so that would be a benefit to the trust. they also agreed to allow the port at its discretion to use port revenue bonds as a financing vehicle for publicly oriented improvements on those non-trust lands. pier 70, we are talking about

infrastructure finance districts, and the ability to use port revenue bonds to make improvements to streets, utilities, historic buildings, parks, etc. that are on non- trust lands. but the park would have to first demonstrate that over all, trust was out of the entire pier 70 master plan. the trust was receiving more investment from non-trust sources than the port was investing of its proceeds in the non-trust land. we think that is a test that we will be able to meet by a long shot. the preliminary calculations put together by kathleen showed $300 million in benefits to the trust at pier 70 out of the master plan. so i am going to segue here. seawall lot 330.

the city entered the host agreement with the america's cup, to host the 34th america's cup in 2013. there is a court agreement between the parties that if the event authority invests in the waterfront to make it race- ready, that we will provide a long-term development rights at a number of locations as a means of repaying that investment. the core of those development rights are piers 30, 32, and seawall lot 330. a host of a new agreement is pretty explicit about a requirement for the city to use best efforts to remove the trust from seawall lot 330. we are lucky that in 2007 we had gone and laid the groundwork for this with sb 815.

it found seawall lot 330 and a number of other lots useless and lifted the restriction and allow the leases for non-trust uses. so we have been in discussions with state planned staff about how to revise those findings and requirements. this is a faded met. i am sorry about that. -- faded map. it shows seawall lot 330 in its entirety. you do not have this in your set of maps. this was developed for the watermark condominium. a remaining 4.3 acres on the side that is used as a service parking lot right now, directly across the street from piers 30

and 32. ab 418 confirms that seawall lot 330 is useless to the trust. we have several decades of leasing history that shows the site has not been used for trust purposes. it permits sale based on the appraisal methodology called for in the host agreement. we have conducted at set of appraisals. the consideration, the price -- purchase price of the property can be provided in the form of improvements to other port property. that is likely to the improvements to piers 30, 32, no. waterfront, public assets -- access benefits. in addition, the port must identify 2.3 acres ofbay

shoreline property that can be entrusted with the trust that is not currently encumbered by the trust. we would have to do that prior to the transfer of title of seawall lot 330. this is a fairly significant to. it fills one of the major city obligations, and we are hopeful that the legislature approves it and the governor signs it. that is my presentation. bill and myself are available for questions that you may have. >> thank you. we do have public comment. maryland's men's -- marilyn smith. i am sorry. is there any public comment on this item? commissioners? brad, in your first slide, it

says the bill was introduced february 2010. you said february 2011. >> i am sorry, 2011. it is not a two-year bill. that is me rushing after vacation. >> understood. you said it is in suspense but was hoping it would be passed. i do not remember all of my legislative history, so -- >> senate or assembly appropriations has a procedure called the suspense file. this is for bill that are deemed to potentially have a financial impact to the state. if they are deemed to have a significant cost, than they normally go to the suspense file. they sit there and then they were voted off after a week or two has gone by.

in this case, the committee consultant was primarily looking to make sure that the port entered a cost reimbursement agreement with state plans to cover the cost of doing the title history, review when the surveys, the other work that follows legislation, which we do as a matter, of course, anyway. we are currently in that kind of cost reimbursement agreement for pier 70. they were seeking similar agreements with respect to seawall lot 330, which only seems fair and appropriate. we agreed -- the author agreed to those proposed amendments. we have every expectation that it will be voted off suspense on the 22nd, i believe, and then head to the senate floor. so far there has been no opposition registered to the bill. >> there was a bullet point somewhere about how the bill

would permit the port to hold the land from which the trust is removed. that seems counterintuitive. why would state lands care? that would assume that we would turn around and sell it. why do you need permission to hold it? >> this goes to the issue -- the public resources code sets forth rules about how trust grantees have to keep separate revenues derived from trust lands and make an accounting to the state. so we, at the staff level, have to look at -- as an example, how we purchase from the city for trust property -- and really be careful that any of those

expenditures benefit the trust. state plans has run into problems where trust grantees want to use their harbor funds to spend on things that, in their view, do not benefit the trust. an example might be a southern california port wanting to fund a trend line largely of trust property that has a terminus on trust property. in that case, they viewed that as an inappropriate subsidy of a non-trust activity. so they are vigilant about this, always looking around the state to make sure grantees are following the rules. in this case, we were looking for something that was really antithetical to that position, which was that we would all these non-trust land with a lot of non-trust uses on them, and they were worried that we would be using pork harbor funds to subsidize the activity. so we have been careful in the

legislation to make sure we have separate accounting and that we have an overall equation that provides a financial benefit to the trust. >> thank you. questions, comments? >> i had a question regarding the need to have these sites cleaned up and whatever remediation. does that need to be completed, just a plan to do the remediation? >> typically, you need to have an adopted remedial action plan. so that has gone through the entire public process that the regional board or department of toxic subsidies controls and administers. in this case, we are working with the regional board. we have gone through site investigations, identified the extent of the contamination, you have done a number of concepts about how you are going to

approach remediation while managing on site or removing it, disposing of it elsewhere, and there has been appropriate public comment and review of the plan. it does not need to be entered before the transfer title occurs. >> how far along in the process are we? >> we are pretty much in the latter stages of this investigation piece that we have done. the uplands investigation. we have done some investigation of the hazardous materials in the building. i think our next step is to look at some of the sediment around the site to see what is in those locations. so we are in the first third of the process, i would say. >> if i may, the investigation

and analysis have been the subject of other commission actions, probably prior to your tenure. for the benefit of the public, there are some good staff reports online that candelabra on that. we will be coming back to the commission when the results are all the way in. it is a great question, but i just wanted to say it is also on line for the general public. >> as far as getting into detail about it, the results have been pretty good. i think port staff has a feeling that there is a way forward to coming in terms of fulfilling the requirements of the regulatory agencies. >> something else that i was that quite sure -- you said all revenues transferred from the land trust go into the harbor fond? >> those would be net revenues. clearly, our private development partner will incur a lot of cost

associated with the site build out, doing the infrastructure, doing a vertical development as well. but there will be a long-term lease for those sites where the commission could, at its option, consider sale of a portion of those properties. under that long term lease model, there would be presumably some revenues at the port would likely use to subsidize other improvements, for example, pier 70, those would have to be deposited in the port harbor fund. >> any other questions or comments? thank you. that was a wonderful presentation we can tell a lot have gone into this. we are happy to do is what within the same property, which

is rare. just for clarification, seawall lot 330, we will remain in -- retain the watermark condominium site? >> no, that was part of a similar, prior package associate with the cruise terminal bill. we did a swap in that case. that was an equal value swap. the trust was impressed on portions of thewp site in exchange for that half acre. >> the remaining site would be transferred? >> exactly. >> thank you. >> items on the consent calendar. request authorization to award construction contract #2752 north a prepare project to suv construction management inc. doing business management company in an amount not to exceed $786,000, and also

authorized have to increase the contract amount by 10% in the event of unanticipated contingencies through contract modification or change order for a total of $864,000. 5 b, request authorization to apply for, except, and expend a grant or $5 million from the state of california prop. 84 statewide park development and community revitalization program of 2008 for the northeast north plaza open space, located on pier 27 at the embarcadero promenade across from lombard street. five c p request authorization to advertise a request for quote -- qualifications soliciting as needed real estate economics and related professional services. 5 d except the port's annual report on contra connectivity for fiscal year 2010-2011. >> so move.

second. >> any public comment on the consent calendar? commissioners? all in favor? the resolution 1151, 1152, and 1153 , along with the port annual report have been approved. >> on 5b, i would like to commend staff for uncovering a substantial amount of money. from what i understand, they had to work with other city agencies to get the party to go for this. it would be fabulous if it comes through. again, kudos on the creativity and finding the opportunity. >> bigger and better. >> 6a.

request adoption of the california environmental quality act findings and mitigation, monterey, an error reporting program for and approval of brandon street wharf public open space project. >> good morning, commissioners. hobbesian this morning, we are here to request the adoption of the california environmental quality act findings and mitigation, my turn, and reporting program for an approval of the brenda street wharf public space open project. i will provide a better product history, describe the features of the project, introduced the project team, and then die and will speak about the environmental documents. the ministry fourth to be located on the embarcadero, not between piers 30/32 and 38 will

be a new $7 a square foot public space parallel to the embarcadero promenade. the work will define the center of the south beach neighborhood. for a better product history, in the year of 2000, the san francisco bay conservation and development commission all working with the port amended their special area plans for the san francisco waterfront. changes made to this plan and in the port's waterfront land use plan remove a longstanding bcdc 50% rule which effectively prevented the redevelopment of many of the historic sheds. with the adoption of these documents, projects such as the exploratory more able to move forward. as part of the negotiations for this, the court agreed to construct two as a given space as eleanor the waterfront. the northeast were plaza, which is the new public space proposed by the area in front of the cruise terminal, and

thebrannon street wharf. these spaces are both described in detail in size and of the uses and the port agreed to build the space is within a 20- year period from the time the plan was adopted. to implement this, the port began in 2001 working with some of the members -- i see a couple of them in the room today. working with bcdc and a 20- member citizen advisory committee. the cac included citizen groups, residents, merchants, and a furry of groups representing a broad mix of regional and local viewpoint. the port conducted seven meetings and three public workshops. the cause of design was reviewed at joint meetings by bcdc review board and the port's waterfront advisory committee three times. the design was concluded on the design was concluded on december 9, 2002, andaugust 12,t