commissioner for catching something really important, and arabic to read a change into the record if i may as a result of her igor i.. is that ok with you? >> it occurs of the very last whereas in the first page of the resolution. so i will hopefully go slowly so that you guys can cross. not your hands when you're all on that page. -- knod your heads when you're all on that page. it comes right after the signature page of the staff report, before the policy itself. paper page 3, third piece of paper. everyone on that? in the bottom the very last whereas, the whereas needs to say where as the port commission desires to create a new

budgetary goals to fund capital maritime projects -- strike the word with come in search in an amount equal to, and 50% of ports. strike net revenue and insert the word annual operating budget, which money's fund certain improvements and the enhancements to the ports maritime facilities and activities as described in the port of san francisco maritime preservation policy, attached as exhibit bay. whereas the port commission desires to create a new budgetary gold to fund capital maritime projects in an amount equal to 50% of the port's annual budget, which monies will fund certain improvements and enhancements to the ports maritime facilities and activities, as described in the maritime industry preservation

policy. i think the results are enough. >> could i suggest the annual operating capital budget. >> yes, thank you very much. you are again correct. >> i have a question on this. how much to regret to -- usually set aside for dredging? >> of the typical dredging budget is approximately $3 million, anywhere from 7 million to $14 million. the mores we have had is 14 million from if i am correct. average is about 7 million. dredging is usually a fair chunk of that. apron repairs is also a fair chunk of that. it is typically imbedded in peer repair, but this is set a different way. it does not really create a new expenditure threshold, because this is standard practice.

it articulates it as a priority. >> when we say pier structure, is that all peeriers? >> we could limit that if you prefer, but it is all peers. >> almost everyone has a priority. >> i understand it now. i think this is a much hwang- awaited policy, and i want to amend the commissioner for bringing this to us today. i would love -- of a point member for -- i love point number four, so thank you so much. great job. >> any other comments? all in favor. >> as amended. resolution 1158 has been approved. item 10 a, request approval to

amend the construction manager/general contractor contract with turner construction company to increase the contract amount for the long lead item treetop contractor bid package for structural steel by an amount not to exceed $6,050,000, which consists of a base amount of $5,500,000 and a 10% contingency amount of $550,000 for project phase 1 construction. >> good afternoon,

commissioners, and executive director. i am the port project director of the cruise project. what a great project following jim's presentation. this is a true maritime project and a good one for the fourth. in june of this year the port commission authorized stock to word the construction manager general contractor contract to turner construction company with the direction that the contract not commit the port commission to approval of the project or grant any entitlements. since that time, turner has made recommendations on construct ability, verify the phase one cost estimate and developed a detailed phase one construction schedule. i am pleased to advise the project is tracking well to the project budget of a phase one -- of phase one, which is torn -- shown in the memorandum. just to refresh your memory, we are looking at the project in

two phases. the first phase is subject to completion and certification of the final eir for the cruise project and approval of the project by the city. in that case the event authority would demolish pier 27, the entire said, which is shown in the drawing of the existing site and the north part of pier 29. the poor would relocate the short-power system the poor would construct the cruise terminal, commencing in 2012 for temporary use by the port authority, commencing early 2013.

this shows phase two, the ship. after the event, the court would build up the remaining building, which includes the customs and border protection and security rooms come install marine of equipment. and complete the improvements on the ground, which is the northeast plaza, a two-acre plaza and the crown prince -- ground transportation area. that is between pier 27 and kurt 29 area. it is an approved, we have an extremely compressed schedule to deliver it in time for the event. in order to meet the date stipulated in the host and venue agreement, the general contractor needs to place the

order for steel now because of the long lead time. this process begins shop drawings, purchase of steel fabrication and installation. the poor recognizes the city may disproves the event, cruise terminal, or both event. we acknowledge to place the order now, prior to the project approval is at some risk to the port. however, this is the best course of action because of three reasons. now is a great time to purchase the deal. prices are low and we have indications of prices will escalate. if the cruise terminal project it disapproved, the court to cancel the fabrication. 3, this lower-cost deal could be reduced.

as indicated in the memorandum, no construction worker insulation will occur at the site until after the regulatory approvals are granted, including environmental review under the california quality act and the port commission and city have approved the project. for the street package, local participation level has been set up 20% with a gold no less than 10 percent of the work hours to be performed by disadvantaged workers. local enterprise goal is 17%, but the total -- the total value of the entire contract. for funding sources, as proposed by the port staff, funding for the amended contract will be provided by culmination of the ports 2010 revenue bond proceeds for the fiscal year 2011 for capital projects in the port

share proceeds from sale of the watermark condominiums. the availability and use of the watermark condominium proceeds are subject to the release of 17,000,700 $900,635 reserve by the board of supervisors' budget and finance committee. it is anticipated the item will be heard by the board finance committee. in conclusion, for staff request for commission of an approval to the construction manager, general contractor contract, with turner construction company to provide funding for the subcontractor bid package for structural steel subject to city certification of the final eir, approval undersea sequa. >> so moved. >> second. >>commissioner woo ho: when you

mentioned under option 2, how much money would be expended? you mentioned you could cancel at so -- as some point, but how much money would have been invested? to go i do not have the table, but i think the last part would be installation, which i believe was $2.7 million. the first part of the shop drawings, which is basically engineering time of 225,000. after that the steel would be ordered and delivered to the fabricator and brought to their sight. the added labor for fabrication -- >> it would not be all this deal? then you said you could resell it if for some reason -- >> we could reuse it on other

projects, but we get the most of you before it is fabricated, certainly after it is installed we only have one use for it. take a right. thank you. -- >> right. >> it is 3.7 million we would have been advanced. i would say would be advanced for steel use somewhere else. it could be used at the back plants, pier 70, any number of places, we just would have purchased it sooner than we would have for those projects normally. on the other hand, we're trying to buy it at the low point of the price curve. and the steel could be reused? >> it is hard to say at what point we would exercise the cancel option, but the order would include purchase of raw

steel and the fabrication and delivery. if at that point but project does not go forward, then we would be meeting to employ this deal elsewhere in the portfolio. if at some point the project receives approval sooner, we could exercise our determination rights at any other point in the delivery stream. >> is there a point where it would be harder to use this field? >> it is specialized for this building, not for the site. you come put it somewhere else. it is a building that will look like the building we envision for pure 27. is that correct? >> yes. could be. >> could be, is that what you said?

[laughter] what i am getting at is we would be able to use whatever funds are expended, that still could be utilized elsewhere and not be out significant funds regardless of the point in time within which we had to terminate. >> correct. there are many materials we do inventory. we would be purchasing steel, fabricating it in a specific format and indicating it in using it in approval for other projects. the limitation would be if you build a building somewhere else, it would have to look like the building from which to fabricated the steel. does that make sense? >> i have a more mundane question. where are we purchasing the steel from? >> the lowest bidder. >> where is that currently?

take a we have not gone out to bid for it yet. current bids are coming in from salt lake city agree prices, but it depends on market conditions and time. there is no by america causes. >> i understand that. but putting people back to work might be a good thing to do. strongly consider that. >> any other comments? >> specifics with the wording of increase of funds. is this exclusively for the design and fabrication of the steel, or is there any added cost that we had already previously granted approval for?

is that increase this cm -- >> there is considerable extra cost. it is approved, but not spent. in other words, we have approved these up to a certain amount -- >> is this additional to what have been approved? >> yes. >> so they're getting paid extra for the steel fabrications component or not? >> they are getting a percentage to manage the work. it is in the initial 3.9 something. >> so it is not additive? sticker you are correct. -- >> you are correct. >> the 6,050,000 that is

requested is added to the turner contract, but it will be payable to whoever supplies the subcontract? turner fees are are ready approved in the previous contract, so it is additive, but not to turner's bottom line? to go that is correct. >> that is correct. >> any public comment on this item? commissioners, and more comments or questions? all in favor, >> the item has been approved. >> item 11, new business. any public comment on public comment? no. >> a motion to reconvene to executive session. >> so moved.

>> second. >> all in favor? >> aye.>> are we ready? >> move to reconvene in open session? all in favor? >> aye >e. >> move to adjourn? >> second. >> meeting adjourned at 5:23 p.m.