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 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.