circle around and fixate on every single piece of it, but i think in terms of the priorities, there were a lot of priorities we saw a lot of consent on. i think this board and this body can feel good about what we are accomplishing, whether we are talking about here 29 -- pier 29, removing that completely. having a functional cap on the port is important. we have assets that are going to be committed. that is the extent of it. if anybody else invests more, or expenses come in at a higher value, or we have different estimates then the values we thought would be reimbursed -- too bad on the event authority. i think that is very important. i think we are losing sight of the fact that we have moved significantly from the december

time, where we did not have a functional cap, to where we are today. that is an important step. i want to thank the port and other folks for making sure that did happen. i think some of the other items, where we did move -- there is comfort in having a third-party engineer provide additional final review. that is important, and to make sure the costs beingincurred ars and the most efficient way to do things. of course, being able to see some kind of participation, i think, is important as well. we have a lot of work to do to make sure we do get the piers back as quickly as possible to minimize general fund payments to the port in terms of lost rent. i think we can get there on that. on the other issue, i think it is important. i commend supervisor avalos for bringing it up and for being a

tireless champion of that issue. i do think we will be able to do what we need to do to make sure that san francisco residents do get there. i hope that is going to be something that folks have made moving on that as well. so, colleagues, you know, there is a question to us now about whether we move this out of committee. i do believe that in terms of taking a look at mitigating our general fund risk, in terms of taking a look at the ports long- term, it seems like these are questions that have been answered. they have been addressed. there are a few things that are outstanding. i understand that. i do think it is time to send this item to our full board to have every member of the board be able to weigh in on it. i wanted to leave my comments at that. commissioner kim: i think i am just reiterating a lot of points

that my colleagues have made. first of all, i am thinking everyone and all the parties that have worked on this in acknowledging the tremendous amount of effort and work that has gone into this. far beyond what i have put into what is before us today. also, just reiterating how difficult this decision is for me and someone who represents our constituents and our taxpayer dollars. i am coming around on the functional cap. it is something that i came in this morning really vehemently against, wanting to see a numerical hard cap. through the conversations today, i have been convinced that this is a good compromise in terms of having a cap on the assets that we expose in terms of a liability to the actual cost of reimbursement. much of this also comes from my faith in the port and their

decisions about making decisions in their best financial interests as well, and how important it is for us to have a financial tool to rehabilitate our piers. the second piece, which is important to me to see, is ensuring that we have strong language around local hire. that has come in today in order to move that up a committee. it is something i think is important to our residents. it is a promise we made to our city that out of this event, comes jobs for local restaurants. that was a promise that was made in december of 2010 when this moved out of the board with an 11-0 vote. it was in economic promise to the city and i think we need to hold true to that before this goes to the full board on tuesday. the third point on the mou, i did want to see stronger language in terms of the guarantee we would get from the america's cup organizing

committee. i understand the dynamic nature of fund-raising and how challenging it is to pinpoint a number on the committee to fund raise. i am uncomfortable about the exposure that we are bringing to the general fund without some sort of guarantee. i am open to continuing to discuss that paul paul -- point. the last piece that i think i am very start on is the 1% on the second sale of condos. that is something that i think most of my colleagues have stated last week was a bottom line for this committee and for many of the colleagues that don't sit on this committee. that is where i am stuck now, to move this out of committee. i don't want to continue it to next week. i do think that timing is important. i do want that issue resolved. -one of the questions was what

it would mean to dedicate the proceeds, the 1% and proceeds, to affordable housing, which is something that is a big interest and a high priority to the district that represent, increasing revenue sources for affordable housing. i was hoping that i could ask fred to speak to that, given that this is port property, and if that could actually work. >> supervisor kim, thank you for the question. the port staff has been looking at ways to develop more affordable housing on port properties. it is difficult because of the restrictions. we are developing interesting proposals that we want to bring for the board's consideration soon. on this idea of dedicating the 1% of the condo sales, whether

that is third or second, to affordable housing, the port negotiated state legislation terminated with the california state lands commission and the legislature. i think that we would come at your direction, go and negotiate with the lands commission to see that these revenues would be dedicated to affordable housing. we would recommend that if you dedicate it in that manner, it be dedicated to affordable housing that is built on port property, that is free of trust use restrictions. i think that would be a good nexus to be able to bring to those negotiations. we would be happy to follow through on that. commissioner kim: thank you. i will say this. it is important to me that we are able to have within the dda, that we get 1% on the second

resell proceeds to go to the port. i would like to see the third and subsequent go to affordable housing. that is something that i can see as a benefit to the city. that is one of the questions i asked last week. what are we seeing as a benefit in this transaction we are having with the event authority? two other concerns i will bring up. it will not be a sticking point in terms of getting this out of committee today. i do have concerns about the leases on the open water basin mainly because it sits in front of new park we are building for the city. i want to be careful about making sure that this park we are investing in will have access to use of the bay. i do understand this will go through another hurdle. i will be involved in that process and will speak out strongly to make sure we protect

the use for members of the public that will enjoy this public park. that will not be the sticking point for me, but i did want to say that publicly. the lasting and brought the upper earlier, my concerns about including lot 337 at this point, i am open to including it at a later point. there has been discussion that it has been in the press about the potential of a warrior is a stadium and entertainment arena coming on to the lot. i wanted to leave that so it could be generated and be kept as an option in the future as we move forward. so, i would feel more comfortable moving forward with the resolution if we take that out at this time. i'm leaving it open to bringing it back in the future. i just wanted to have that not be a hindrance on any concessions we are having on that lot. that is where i sit at this

moment. commissioner chu: thank you. wanted to ask if they would respond to that issue. >> sports staff would be amenable to the amendment to remove that from the resolution of intention. commissioner chu: today has been a long day. it has been a long month. let me also express, i know there's quite a bit of frustration among a lot of parties about the desire to get and move things out today. i think part of the challenge we have here at the board is that city staff and the event authority and others who have been working on this for several years, you have been working on this in the middle of this very intensely for a couple of years. those of us who served on the board of supervisors, we have

lots of issues we go to. we have had to parachute and lunar -- learn these issues intensely. frankly, really, over the last few days. i know there has been a lot made of the final approval that came in the middle of december, 2010. it was repeated over and over again by mayor newsom's administration and others that what we agreed on in december 2010 or not the final approvals. we were approving a deal structure, and i recall saying publicly, we know that we are moving this forward, but this is by no means the last seven decisions we need to make. this is where the decisions are made. i certainly appreciate the comments of supervisor avalos and campos about the desire to have a little more time on this. i also understand the pressures to want to try and get something out to a vote by tuesday if we

are able to do that, and then out to a vote that would happen a few days later. i don't want to repeat issues that have been raised. i know there is a lot of different perspectives. part of the issue of the cap is to make sure that if there is a significant upside, that there is some limitation on that, or that the city's share in that. that is why the issue of the 1% on the second sale is so important. i hoped that we would be able to make some headway on that. i still hope that will be the case. i think for many of us, that is an important issue. i want to see language around the mou in asserting what sort of protection is the city will have just in case fund-raising is not worthy to be. many of us support supervisor avalos' issues around local hiring. i want to make sure the pier 29

issues, that is a minor detail, but i want to make sure that is settled cleanly by tuesday. i know there will be discussion about whether this moves out of committee today. one possibility, if we need half a day to figure out where we are because we have received an awful lot of paper, that means possibly we recess until tomorrow morning. i have been told that the clerk has informed as we have until 2:00 tomorrow afternoon to finalize the written amendments that might go to a committee next tuesday. that is a possibility. it is up to the committee to decide whether that might be enough time to resolve other issues, or whether we need another week. commissioner avalos: i was thinking more than tomorrow morning. i also have the district meeting tomorrow morning as well. that is the difficulty for me.

just to piggyback on what supervisor campos had said, how we have these deadlines that come before us and we are forced to make decisions with the spending deadlines, it makes it difficult to contract a time to make the decisions. i recall in january, there was a discussion saying, you cannot continue the eir because they will break down -- break ground on demolition for pure 27 -- pier 27. that did not happen. it is always some kind of event that is going to come up, it is imminent about our votes here in the budget committee. i don't think it is quite fair that we have it put before us. i think we could spend a little more time to figure things out. i was hoping to actually recess this meeting and come back

before tuesday's meeting. spend time on looking at amendments we could make to the resolution and see if there is any more movement and certainty on some of the recommendations we want to make in their written resolution, specifically around the condo sales. i am actually more open to a functional cap. something i want to explore further. i believe there is a lot of things that were explained in committee that i need time to go over. the local hire ordinance -- i think it is close, but not necessarily resolved yet. we should harmonize what we have been hearing from people in the community about how they want some legislation, or they want an agreement that is actually going to mirror closely legislation. i don't think we are quite there yet. i would like to spend more time

doing that. my motion would be to, to recess this meeting until, say, 10:00 on tuesday morning. and, i'm willing to postpone that after making some amendments to this resolution as well. if i could go over those resolutions first before really going into my motion, i would appreciate that. commissioner chu: did you formally make a motion? commissioner avalos: i did, but i will withdraw it. i will make some motions on amending the resolution that is before us. the first is on -- i actually have copies here that i could share with everyone.

the first was actually looking at -- , was going to look at a hard cap on reimbursements, but i am somewhat swayed by what was discussed today. i think what i would like to do is make an amendment or additional resolve clause. additional resolve clause in the resolution that would say that there will be a cap on reimbursement in so far that no additional general fund monies will be utilized in such reimbursements, and then, i actually feel that we could add the language that is here in this document that was provided by the event authority

specifically that -- that says the port -- it is underlined in the second page of the third column. the second page. the portables obligation to reimburse the authority shall be limited exclusively to revenues derived from the following sources. we could list those sources in the resolution as well. to me, that is taking the language that was told to us would be in the agreement, that this is bringing forth in a resolution. the key to me as we're not losing general fund monies. that would be one motion i would like to make on this. if we could perhaps -- commissioner chu: just to be

clear, your first amendment that i see on this sheet, it talks about the aggregated hard cap on reimbursements. that is not what you are doing any longer. commissioner avalos: it is a cap and so far there are no general fund monies that will be utilized in such reimbursements. then, we use the port's language that they propose to us that the sources of the reimbursements, or the investments, will be finite. we are just clear that there is a finite source those reimbursements will come from. we're not making a hard cap of $85 million, which would be my druthers. we are making some other firms statement about wanting to have those outlined sources as the port has indicated and agreed with. commissioner chu: i would like the port to be able to respond

to that amendment. from my point of you about the additional resolution language that pulls up the same language in the dda, that does not seem to be problematic. i want to hear from you. in terms of the issue about the general fund levels, i think i would be interested to hear what you have to say about it. supervisor chiu mention there might be opportunities where we actually want to have a different financing mechanism. can you speak to them? >> i think a couple things. based on the resolution and restating the reimbursements, the finite but it makes sense and i support that. -- bucket makes sense and i support that. i would suggest using the language that we can read into

the record that talks about, no one can force the general fund or harbor fund to do any of these things. that discretion is left with those bodies. we have those options under the reimbursements frame we are talking about. commissioner chu: supervisor avalos, its sounds like the port is in agreement with indicating the language that was part of the recommended lang -- recommended action. then, with regards to the issue of the general fund, there appears to be language already that speaks and limits the general fund liability. does that sound amenable? commissioner avalos: i would like to continue to see if we can make a specific statement as a committee of the general fund usage -- uses, for not using

general fund monies to pay for these reimbursements. commissioner chu: ok. if i could ask if there are any comments for this amendment at this time? ok. if we can take the two motions separately, i would like to be able to vote on them separately. commissioner avalos: i will have more. i will have about four. commissioner chu: what i am saying is, two pieces to this motion. there is a component that speaks to adding the language that specifically laying out the obligation to reimburse authority under the clause, shall be limited exclusively to revenues derived by the following sources. that is the first portion. colleagues, specifically, to the voting members of the committee, there is a motion to add a resolve clause 2 item number four, that would take the recommended action on item number two and incorporate that

language into the resolution. that is the motion. i would be supportive of that. do we need to do roll-call? that motion carries. there is the second portion to that, which is to indicate -- can you repeat the language? commissioner avalos: the language would be that no additional general fund revenues -- no additional general fund monies will be utilized in reimbursements on the event authority's investment. commissioner chu: that is the language supervisor avalos is suggesting in terms of item number four, correct? that is the motion before us. that when i will not be supportive of. i do think there's opportunity to perhaps have a smarter financing mechanism, a cheaper- cost financing mechanism that we do not want to preclude.

i will be voting against that. if we could take a roll call? >> can i ask a question on the amendment? to the point about whether -- what the impact of this amendment would be? >> you recall that in the cruise terminal projects, we have two sources of financing. one is through the revenue bonds, which carries the lower rating. or, we have looked at the city vehicle called certificates of participation. we can use the city vehicle if it produced a lower interest rate.

i think you would mean we could not use part if -- certificates of participation. commissioner kim: which have a higher borrowing costs, usually. thank you. commissioner campos: if i may ask a clarifying question to the port director, my understanding is that if this motion passed, you could come back to the board and the board could make that -- >> i do not think i am the right person to answer that question.

you're saying a future board could reverse that decision? commissioner campos: right. the board itself could actually change that if there is a decision that there is a better financial instrument that would make sense for the city. i guess that is a question for the city's attorneys office. commissioner kim: i think they did have specific language that did not put it at risk. >> i believe that was the question to our office. it is our understanding that certificates of participation, for example, or any other sources of bond financing, would have to be approved by the board come in any case. he could override this provision if you chose to do so.

commissioner campos: that is my point, having that does not preclude the use of those instruments. ultimately, they have to come to the board come anyway. commissioner kim: thank you. i would not want to close the door at this moment. you're right. it does come to the board come anyway. we do have the motion before us. commissioner chu: can we do a roll call on that? commissioner avalos: aye. commissioner kim: no. commissioner chu: no. >> the motion fails. commissioner avalos: thank you. i would like to make another motion. that will be restating 7.3hi. it states -- it states that private transfer fees will be recorded on each residential condominium imposing a transfer

fee payable to the port in the amount of 1% of the sale price of any condominium constructed on the lot. initial sale of beach condominium shall be exempt from the transfer fee requirements, but the transfer fee shall be payable in perpetuity at the close of each subsequent sale of condominium. i would like to add that back as a resolution clause in this resolution. commissioner chu: thank you. you're making a motion to add an additional resolve clause 2 item number four as you read into the record, which primarily and functionally puts a 1% transfer fee at the second sale. that is how i read this. is that correct? commissioner avalos: that is correct. commissioner chu: that is the motion. with regards to resolution, clearly, we can amend any resolution and put any piece into it. however, with the fact that you

have an underlying da that is usually mutually agreed upon, how does this functionally work for us? >> madame chair, if the board makes an amendment to the legislation that is approving the dda, the board is setting the level of authority that it is giving the department to enter into the agreement. that agreement still needs to be reached and signed. you are giving advance authority come in a sense. it would then be up to the parties to be able to reach that agreement. commissioner chu: ok. if we make this amendment in negotiations with -- about the dda, if both parties do not come to an agreement on a transfer fee at the second sale, then there is no authority to enter into that agreement. >> that is right. commissioner chu: just a question to mike