recall from the end of last year. we had to work to dissolve the agency fidler february-dissolve the agency by february. what front if and programmatic areas are we going to continue to do versus those that we have to consider what next steps there will be. we are hoping from this hearing that we will hear from redevelopment. and the city administrator and other involved individuals to give us this update. i will turn it over adnd we will switch off with others as necessary. >> good afternoon. the former executive director of the san francisco redevelopment agency and now director of the

successor agency. thank you for that introduction. by way of context, redevelopment as we all now, a 60 year history. we make great strides in that recent history providing significant investment in economic development, neighborhood corridor revitalization, significant investment in housing development, at 10 thousands affordable housing units were developed by attacks instrument dollars periods -- tax dollars. the purpose of this at the to you and to the public is to provide you an overview of where we are and where we intend to go. i would like to touch on our order of events agenda for this

afternoon. we will touch on the dissolution timeline, the actions by the state and the actions by this for to move quickly in response to that dissolution to preserve our important assets and obligations. there is a new structure for activities that are mandated by the state. per direction from this board through the actions it took in january in response to that. the work is organized in broad categories. we have the successor agency that focuses on non-housing activities. the housing successor agency which is leaking -- the housing agency. and then our next step at the

state level and with you on how we move forward. touching briefly on why we're here and/or we have been, last summer, there was state dissolution legislation that dissolved previous agencies, at the same time, the state legislature passed ab 27. it allowed agencies across the state to continue activities. that was passed last summer. there was litigation in the state supreme court -- and the state supreme court decided to abolish all redevelopment agencies, including that was- which was created in the city and county of san francisco.

that brings us to where we are. the board acted quickly with the mayor's office in january in response to this, passing two important resolutions. stepping in the city as successor. transferring our affordable housing assets to our mayor's office of housing. in terms of our structure, it is a new structure which we will discuss, confirming the appointments of the oversight board that would review all activity of the former redevelopment agency with respect to tax increments periods since that time and since the evolution, we have taken a number of steps required under that legislation. allstate compliance steps to

provide for the state a fear of picture of our obligations as we move forward under the successor agency. only those that are recognized that our -- by the state and board. that is what we use tax increment for. as we talked about this oversight board, there were four appointees and three seats. the primary purpose of this board is a fiduciary, a fiscal responsibility to make sure all the former obligations and assets are honored and paid off. two, the sports-the board also confirmed -- there are three

major projects. which through an integrated set of master agreements can continue to draw on tax increment hidden we have a contract with private developers that provide for ongoing review contract authority, land use decisions pursuant to its implementation role. the board would have that ongoing land use addition to its fiduciary responsibility. these are enforceable obligations as the state has required and the work is organized in three departments. the non-housing assets and their

management are within the city administrator's office. the former redevelopment agency is in the city administrator's office. the housing assets and the port under the non-housing assets. this is adjacent to at&t park and other leases we're working to transfer. the port zones those profits -- owns those properties. this is mandated and dicted by ab26. we have to pay our debt issuance. we are implementing these major projects, generating, or will

housing projects. that implementation will continue for 15 to 30 years. there are areas we are responsible for and wind down activities. there will fulfill those obligations once they are completel. we have touched on this. this is the value of $20 billion public and private investments in these areas. these are areas where we will continue to implement with our development partners. these have -- recognizes an

integrated set of obligations, not only to build public infrastructure and improvement affordable housing as well as other public benefits. these are three key areas in which infants will continue to be passed increment -- increment will be collected. mission bay represents one end of the spectrum. it is halfway done. new community, all these areas which we will talk about. these are transit oriented development. transbay is at the next level down. it is the start of its implementation. we would generate well over 3000

housing units, over 35% of affordable. other public improvements. our agreements with the state and with the transbay joint powers authority provide for that to go to three purposes, the terminal, and affordable housing, and public improvement. we were at a groundbreaking, we expect that to continue into the future with the future increments as recognized by the state. that hunters point shipyard is at its inception. we received approval. another model of sustainability. infrastructure work is nearly complete on the first phase of

the hilltop under way at the hunters point shipyard. and then candlestick point is part of this robust program. that would be developed in partnership, we have a partnership with the state to improve the state park area, rebuild the affordable housing development. as part of that development as well. the other obligations for this successor agency within the city administrator's office, we touched on the management of those assets and the former western addition, there are a number of economic development loans. some of their obligations, these are obligations we will monitor for compliance on an ongoing basis. yerba buena center, that is an

honest-ongoing obligation. the mexican museum, to provide for operating and construction. that is an activity that will continue. supervisor chu: are we going to continue to honor the agreement that yerba buena center has with gardens and -- the mariott. that was a side project. >> absolutely. yerba buena center is complicated. is the maintenance of the gardens but it is an interlocking set of agreements with hotels, kesse reaches and others, to pay for these cultural assets such as the creativity museum, the museum of african diaspora, it scheduled

payments to them through 2015. those are obligations that will be honored and placed on our schedule for review by the state. >> we will honor its as is, her or is there a slight modification. prentix>> those are enforceable obligations. we talked about the transfer. and because of the tax increment tool, we were able to use that to develop the harbor and surrounding parking properties. redevelopment -- with the port of owning that property. we were effectuating the transfer, working with them july

1. the true wind-down activities, any improvements we have. this affects the bayview hunters point corridor and our work along sixth street. we had our economic development loans and other investments to public improvement. we will not be making any further investment from the dollars. unlike the major proved, there was no overarching long term 40- year set of agreements that allows us to collect tax increment. we will continue the redevelopment activities there. this is getting to what cannot be continued under redevelopment using taxpayer dollars. there was a very long term plan that this board adopted. the community strongly supported

it. we were in negotiations with the master developer there. we did not have an agreement in place. the legislation was passed. there are no abilities to continue to pass the tax increments there. for the market area, there has been a lot of progress with the city and mayor's office. we are always additive to that to provide affordable housing stabilization, other public improvements. that was not a remodeling project area. we have touched on this. our work primarily in the bay view was of a more community revitalization, facade

improvements, business attraction. we will continue our work that we previously funded. in terms of new redevelopment dollars, there are no new redevelopment dollars that we would continue under the successor. >> with regards to the areas where there are not enforceable obligations with the market and the street, can you just explain what the process is going forward? i could imagine that there is probably some conversation with the mayor's office about how to proceed in these areas. >> that is correct. we are talking to the rest of the city. both with the city administrator, the mayor's office, public works. all of the relevant departments to continue this work program.

redevelopment dollars and important tools in particular on the third street corridor. they are always leveraging dollars. it takes every last bit of local, state, and federal money. our dollars are quite additive. it worked out with financing. it has been an active conversation with our community partners in each of these areas on how to continue these activities. in light of the dissolution of redevelopment. you will see that through the department budget. to give you a big picture of staff and redevelopment, as of january 1, there were approximately 101 staff through this process. and this was on february 1. through that process, we

retained 66 positions. 37 were within the city administrator's office. 10 of those positions given the scope, were retained by the office of housing. nine of those positions were retained by the board. there were 40 layoffs that happened that as of march 30. then there were a number of individuals who decided to move on, whether retired or separated. touching on staffing, the employees were represented by two bargaining units. bargaining is ongoing. there were preliminary term sheet agreements were reached as of march 30 s. folks are quite pleased on

all sides. that gives you the lay of the land as to where we are in terms of staffing. >> the defense is being capped at 9%. will this cost go beyond the 5% tax? >> i will move to the next budget slide to talk about where we were before and where we are going. ab 26 puts a 5% cap on administrative costs. that 5% is just for this current fiscal year. on an administrative basis, this drops down to 3%. the maximum of noncallable for

purely administrative spences is 3%. taking a step back, the improved budget last year, which is our current fiscal year, we have approximately $126 billion as part of our approved budget. we had a number of fixed costs, things that are knowable and we would expect to remain the same going forward. these are statutory pssthroughs. the city and county of san francisco is the largest recipient of those. then it goes to the school district and city college. we made them last year and we make them this year. the redevelopment agency, making those payments. the comptroller's office is now

mandated to make those payments. it gives you a snapshot of approximately $40 million. >> what your saying is 5% of the stocks >> and $40 million is just the pssthrough payments that come off the top before the taxes are distributed for these obligations. once the controller's office makes the payment, then the city and county gets its share. >> the 5% cap is fine. it actually gets passed th rough to the city? >> this is to be used purely for administrative costs.

>> is this before or after? what is the after amount? >> it is approximately $3 million. >> does this fit within the dollar amount or will we have to escort some of the costs out of the general fund. >> all of the obligations we describe where personnel costs associated with those obligations. ab 26 says that those are obligations. it is a little but of an apples to oranges comparison. we expect to still be within that framework. >> some staff has been working

on obligations. >> is purely administrative. >> they are helping to wind down agency activities. >> the staff are captured with the obligations. >> i understand that. they are capped at 5%. we are living within those means. are we going to have to add to the cost of the fund? >> i believe we can live within our means. it is a process. the state still leads to review the obligation payment schedule. although our oversight board has

unanimously approved it, there is still a level of state review that is subject to change. >> there is a level of estimating that we are prepared to do. this list is approved by the oversight board. >> that do supervisor kim. commissioner avalos: just a question on the other staffing light out. for the transition of workers. francis dang to new jobs within the city and county -- transitioning to new jobs within the city and county? >> as of march 30, there were 40 layoffs. we concluded bargaining on a number of term sheets. it was agreed upon term sheet.

it provided for a comprehensive package, i don't want to step on the toes of what we can and can't say. the budget director to standing up. >> the city has been working with labor to come up with an agreement. we are still in negotiations. part of the agreement that we are moving forward with relates to the service rule changes. our director is exploring whether there are any opportunities to allow for folks at the agency to have additional

opportunities within the city. my understanding is that the city has provided transition support for individuals who were laid off. information about how to apply for jobs within the city and certain employment counselling. >> thank you, supervisors. >> i would like to ask for the director of the mayor's office of housing to touch on that. and then we will close. >> good afternoon, supervisors. based upon the actions taken by

the board, the housing assets were transferred to the city and under the jurisdiction of the mayor's office of housing. that transfer was recognized by the oversight board as part of this process. they oversee those assets. they will continue to go to the oversight board. the oversight board's role is fiduciary. if there is a funding of a project with new increment or modification of a loan agreement based on tax modifications, that would have to go back, first through our loan committee process. there are a number of

enforceable housing obligations in this transition. the director talked a little bit about the redevelopment project areas. within those approved project areas, there are current and foreseeable obligations that are related to affordable housing. all of those contracts were identified to the state as on going eforcable contracts. there are additional costs in the recognize obligation payment schedules as well as other housing transaction costs. one of the processes, in addition to the approved projects top the recognized

obligation payments provided for the replacement of housing loss during the early part of redevelopment. in addition to the 3 approved redevelopment projects, the fourth major activity that the oversight board submitted to the state was the replacement housing obligation. this was approximately 6700 units that were demolished and not replaced. 6700 affordable units that