left. i would be happy to answer questions. i was astounded. if i were you, as elected members, on behalf of the people of san francisco, i would be astounded by the powerful arrogance expressed by the representative of the america's cup event authority. you should not be bullied. we all want the america's cup to come here, but not at any cost. i urge you and i commend you. i have much more to say. i urge you and commend you to stand for the best deal. get pier 29 out of the deal. get rid of the long-term marina developments. i conclude my comments. thank you for your time. chairperson chu: there are no questions at this time. public comment?

>> thank you. my name is carroll. i am the deputy director of the national park conservancy. we raised the $35 million for the restoration. i am here to speak on behalf of our donors and the more than 4000 volunteers, just to remind everyone that the national parks need to be protected. this is an amazing sight that is loved by more than a million visitors every year. our organization is thrilled that the america's cup is going to be -- to make the field even more in the spotlight in san francisco. we have been working very closely with the event authority to reach an agreement for the protection of the field and the national parks is doing the same for the park. we are not quite there yet. but i want to say they have been very responsive to our needs and our requests that the field not

only be protected during america's cup, which i hope has a crush of people there to see this amazing grace. but in the event there are any damages, they would be repaired after words. we are pushing toward a final agreement. we also share your pain. we are enthusiastic that this is going to work out. as i said to the full board when they met about the america's cup, after these long meetings, i invite you to go to the field and go for a walk. it is a restorative place to find tranquility and peace. chairperson chu: thank you. are there other members of the public who wish to speak? public comment is closed. the titans are before us. we have an -- the items are

before us. supervisor avalos: thank you, chair chu. i know it has been a long road, very difficult negotiations, a lot of sleepless nights, probably a lot of anxiety. this is only a small portion of what i know you have experienced this fortnight. like a said last week, if this was just about voting whether we are going to have america's cup or not, it is not related to the finances of the city, and i would have no problem voting for it. we do not have that before us. we have many aspects of our port

finances went to what is going to happen in the future. i do see the benefits of getting development on a port where it has been planned for years in the capital plan. we should get a jumpstart on it because of the conditions in the economic arena of the city, as well as the port in terms of being able to get a return on investments that are getting more and more dilapidated. i understand the difficulty the port faces. this is an opportunity to develop the use of land that could have greater economic benefit for the entire city, not just the port itself. but i do not feel confident in what we have in terms of projected revenues that are going to come out of the america's cup event that could help the city minimize its costs of what we are going to be putting in to make sure the event can go forward. i do not give a lot of credence

to the revenues that are projected to come in. i always take that with a grain of salt. i would expect that we are going to beat -- one question i have is -- is the 60 factoring in what revenue benefits are going to be as we are doing budget projections, based on what we are going to see in additional revenue? does that obviate the need to do better planning in our budget? because we are going to be seeing added revenue come into the city, but it is going to be paying for the event. it is like a circular phenomenon we are seeing. the money we are using to hold the event goes back into the event itself, the revenue. that does not mean a general fund bump. i do not think we will necessarily have a surplus, based on fund-raising in the city, how much the organizing

committee is going to be able to fund raise for this event. i do not think we will get a surplus. i do not think the money we have yet israel. as i said earlier today, if we have to pony up money as a city -- everybody would laugh at us if we said we would endeavor to pony up money. that is not something i feel comfortable putting my vote behind. i need more time. i can see that we can continue this item. not to move it out of committee. i think if we go to the full board, we lose a great deal of the leverage we have as a board of supervisors to make sure we can get the best deal possible. i do not necessarily want to delay a long time. i can see a week to do that.

i have questions around workforce development that i do not think is quite as strong as it can be. i think we can follow more aspects of the local hire ordinance, particularly around -- we now have liquidated damages versus penalties. i think that is a significant difference. i think it is important for how we do our local hiring that meets what our standard is in the city. that is the local hire ordnance. if we have something different for the event, that does not make sense. moving forward, we want all our contractors to comply. i think having an exception for the event authority, for the event itself, will minimize what we are trying to do with a local hire ordinance. i feel much more comfortable with the condo sales have been subsequent to the first sale. i see arguments that have come

forward from the office of economic and workforce development. you have a certain amount -- you have a bucket. you have a certain amount of money you are going to get. if the sale is happening earlier, the city is not paying enough in reimbursement. but i think if a second sale or subsequent to the first sale, that 1% would be something i could live with. one of the main things -- i would want to keep this in committee if we do not have that. i do not want it at the board. i am prepared to do a host of amendments to the resolution, if need be. but i would like to hear more from my colleagues on the committee. chairperson chu: thank you. i did want to ask mike martin, with regards to timeline, can you tell me more?

>> based on the construction schedules before us, we have been advised by the event authority of the need to have the board approvals by next week, every 28. -- february 28. the discussion needs to continue in the committee as a whole. we will try to address whatever comes out of this. chairperson chu: thank you. supervisor campos: i want to reiterate what has been said about thinking staff not only at the mayor's office, not only the folks at the event committee, but all the organizing work that

has gone into this. i want to think the budget and legislative panelists for this report, as well as the city attorney's office. one of the things i think is important for us to consider is that i have yet to experience with any major project where someone wants that project to go through is ok with a delay. time and time again, we hear that the sky will fall. somehow, we as a body take the time to deliberate appropriately. with respect to the america's cup, i can tell you as someone who was here when they vote was taken on december 14, 2010, that at the time we needed to act

them, and if no action was taken by the supervisors, finalizing a deal, that somehow the event would not be able to take place. what is interesting about that is that the board actually did act. the board did act. lo and behold, between december 14 and december 31, two weeks later, there were additional negotiations where additional provisions were added to the agreement. so that extra two weeks did not and the event, did not terminate the city's ability to have that project. the notion that somehow this has to be voted on by next week is a notion that is very recent. it is a very light piece of information that we have given -- that we have been given. i have yet to understand specifically why action would be

legally required or otherwise required by that date. what is wrong with the san francisco board of supervisors, which has made it clear that it wants this project, to take a few more days to actually iron out some very complex and important issues? why not take an additional week or an additional few days to really get down to whether or not this issue of the hard cap, whether or not we are comfortable enough with the language that is presently in the dda, whether we should modify the resolution to provide additional protections to the general fund? what is wrong with us having more of a discussion about the 1% condo sales after the second year or third year? there is a difference of opinion about that. why not have a discussion on

that? why not have a discussion about why the 15% we previously included, as indicated by the budget analyst, is not in there? we heard there are at least three items that they recommended that were not included in the response. why not take the time to actually see whether or not those items should be included? we also heard from the budget and legislative analyst that they have not had the time to really consider whether or not responses were provided to the recommendations. whether or not those were adequate to address the concerns of the recommendations. i think we should give them the opportunity to give us that information. there was a draft of a memorandum of understanding between the america's cup organizing committee and the city and county of san

francisco. this document is seven pages long. it has two exhibits. i would like the opportunity to review, analyze, and consider the different provisions of this agreement. shouldn't we do that before we move something forward to the board? i think that is the right approach in making sure we do this right, to take the time to do it right. we could take another week to consider these points. it is not going to be the end of the world. the one thing that i think we should avoid is to have the board take action along the lines of what happened in 2010, and be in a situation where the mayor's office or someone else has to go back and make changes. it would be great if we could have a final resolution, but that is not going to happen unless we take the time to do that. i would respectfully ask this committee to make sure we take

the opportunity to do this right. chairperson chu: thank you, supervisor, for your comments. i want to thank also the staff, the port, the event authority, our budget analyst. i like the recommendations made. a lot of issues were covered in a lot of meetings. from my perspective, as i indicated in my last conversation here at the committee, it was really to take a look at functionally whether it is a financial possibility for us to take on. what were the risks associated with it, in addition to what the port finances have been? i think we have covered many of these items today. we have heard from the department of about the status of the negotiations. i would just say, in terms of all the due diligence we are doing, i think it is absolutely our responsibility to make sure we are doing the best that we

care, being the most responsible we can be. but i want to echo some of the comments supervisor farrell made earlier. what gets lost in this conversation is the incredible opportunity. i heard from the port about the opportunities for a huge initial investment we would otherwise not have had, to repair appears that are in serious need of repair. -- repair piers that are in serious need of repair. they are not fancy things anybody wants to pay for -- a bronze along the waterfront, tiles. -- aprons along the waterfront, tiles. these are big opportunities for us. i thought of the issue about the fund-raising and whether there was any risk associated with not seeing the fund-raising come through, and whether that is something we can look at in terms of expenses. i think there is an answer

there. from all the conversations i have heard and comments i have received, the acoc is going to be capable of raising additional money. they have raised significant money already and are generating excitement for a project that has yet to be approved by this body. and think that is the important thing to note. i also think that given some of the scaleable items, the expenses that will depend on the crowd -- i believe people see the waterfront as a special place. i do not think we will see the same issues we saw in san diego. it is going to be a successful event. from the fund-raising component, there is a good story to tell. there are ways to mitigate risk that make me feel more comfortable with this transaction i think with regards to the point that harvey raised

-- we went through them point by point. there has been significant progress made. in negotiations, we tend to 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