hospital -- on my mind ♪ ♪ general hospital was always on my mind ♪ ♪ won't you please give it some more time ♪ ♪ would you please give it some more time ♪ ♪ tell me, tell me, that is going to really shine ♪ ♪ and you are going to fix its fine ♪ ♪ fix it great and find ♪ chairperson chu: thank you. it are there other members of the public that wish to comment on items three and four? seeing none, public comment is closed.. do we have a recommendation to send this out? we have that motion and we will do it without objection. can we call the next two items? items five and six. >> item 5, a resolution authorizing the direction of sale not to exceed $4040,00

thousand dollars. item six, appropriating two hundred $10,000 of the earthquake emergency response to the public utilities commission in fiscal years 2011-12 for necessary repairs in order to better prepare san francisco for a major earthquake or natural disaster, and placing these in the controller's reserves pending the sale of the bonds. chairperson chu: thank you. >> nadia from the comptroller's office of public finance. we are asking for $4.4 million for the issuance of the bonds for the emergency response system.

the voters have approved this in an amount not to exceed $412.3 million in 2010. this will be in a series. amortized over 20 years it will be $3.4 million. it will get the capacity from 1.04 to 1.07. the goal is to issue visas at the same time because by consolidating, we are able to reduce the cost of issuance. that will result in items three and four not to exceed $305 million. it will also result in a 1.2% capacity, which is substantially lower than the 3% allowable in the charter. and it will allow us to maintain

the 2006 level tax rate that we have adopted as policy. again, the documents also delegate to the comptroller the authority to offer statements included in the budget, as well as other financial reports that are in your now. -- in here now. we are expecting to have a meeting in connection with these sales so that we will be able to access the market. we have a representative from the puc you can speak specifically to the project. if you have any questions, i will be happy to answer them. chairperson chu: thank you. >> good morning.

the assistant general manager and cfo of the san francisco public utilities commission. i have a brief presentation and update to give you on our seismic upgrades as well as disaster preparedness as well as the of the three water supply system. on the city fraud, we have been making good progress with the comprehensive -- city front, we have been making good progress with the comprehensive review for the required repairs to the existing in the structure. we have been coordinating and working with our fellow city departments over the last several months. chief white, our general manager, and their representative from the water department and mr. ritchie from dpw are all working to make sure that we deploy these assets as best as possible for the city. the auxiliary water bond authorization has been covered. we are back for our second

series of what voters have approved some time ago now. we are making good progress, and i will briefly highlight some of that. for the work before us today, specifically we are asking for approximately $38 million of project funding. and to put that in the context of what voters approved, it is slightly more than $104 million. we only need a portion of that because we are in the second phase of the design construction. the items before you today and the amounts are $38 million for project funding. this includes project design as well as construction of existing facilities as well as new facilities. and then issuance costs. the planning and design of the ashbury height the tank as well as the jones tank, as well as

the peaks and tunnels, that is approximately $10 million. twin peaks reservoir is coming in at $12 million in the item before you. and in construction, about 38 potential cistern sites, potential cistern sites. we are asking for $68 million to partially fund that. we're working closely with the fire department to be sure we have adequate coverage. i'm joined by the assistant deputy chief as well as our project manager if you have any detailed questions. the last chart in your packet is a very detailed construction chart showing that we want to get construction under way. the reason we're coming before you now is to ask for that funding so we can go through the bidding process. i will be happy to answer questions. chairperson chu: i do have a

question about the cisterns. will that be for the repair of existing systems, or the construction of new ones? >> the majority is broken into two parts. there are some repairs, but the lion's share is board news cisterns. chairperson chu: and i have a question for the fire department. have you determined were those new cisterns will be located in relation to existing ones? >> my name is phil stevens with the fire department. we have broken it down into two categories. the first category is most likely to succeed as far as eir and categorical exemptions. those will be strategic to us. the second are basically backup in case the first set does not work. we have a distributor threat throughout the city at different locations to basically get the beginning of coverage in all areas.

chairperson chu: the use their pride or it -- prioritize based on the likelihood to pass an eir, or based on where we want to show up vulnerability? >> primary is vulnerability. and we have a second set that may not pass initial eir. chairperson chu: do you have an idea of where they are located at this moment? >> yes, i do. chairperson chu: can you explain where they are located? >> we have them along sunset boulevard because that is where there is a break. we also of areas where there is low head pressure. chairperson chu: and in terms of where they would -- when they would be constructed, do we have a timeline for that? >> that is up to the project manager.

>> my name is david myerson, project manager for the public utilities commission. the new cistern construction, the group one sisters, we hope to have under construction in april of 2013 and continue through august of 2014. chairperson chu: that includes sister and one, two, three, and for that you have listed here? -- cistern one, two, three, and four that you have listed here? on budget page 5 it breaks out into cisterns one, two, three, and four. >> that only includes a couple of them. there are more in the project design as well. let me turn to the supervisor. -- the project supervisor.

cistern number one, we have designated as the repair work that we have it intended to do. this is turns numbers 2, 3, and for our new construction -- cisterns numbers 2, 3, and therefore you are barred new construction. and they have come out of -- numbers 2, 3, and four are under new construction. essentially, we will be taking some money out of what was originally budgeted for cisterns and will be constructing 16 new cisterns.

chairperson chu: 16 new ones from 2013 through 2014. >> correct. chairperson chu: why do we go to the budget analyst report? >> madam chair, on page 7 our report we have determined that based on a 20-year term, the total bond will have an estimated debt service of $68 million. that is $28 million in debt service and the average payment is about $3.3 million. a single-family residence with an assessed value of $500,000 assuming a homeowner's exemption of $7,000 will pay an average annual additional property taxes of $10.37. we recommend you approve this legislation. chairperson chu: why don't we open these two items of to public comment? are there members of the public that wish to speak on items five or six?

brecht's good morning, supervisors. my name is bryan brown. i was on the revenue oversight committee for six years -- nine years representing this board. it is unclear to me that propositions 6 and 7 provide a seismic upgrade. and also proposition 8, to cover the broad, i'm not sure how a dichotomy is made between the general obligation bonds which come from a different part, and revenue bonds that come from utility rates. i would like more clarification. the other problem i have is that i could never find out how much money was actually spent on projects and how much money was yet to be amortized and put to the rate structure. at the last meeting, they said

they had spent 20%. that means there is a lot of outstanding. my understanding is at one point they had nearly $2 billion in the controller's find at 1.5% when we were paying 4.5% average on that money. i am also concerned about the switch from the utility last possessing rates -- assessing rates. it but i do not have time. thank you. chairperson chu: thank you. next speaker. >> ♪ don't stop to ask ♪ ♪ it's time to make it earthquake safe at last ♪ ♪ you got to find a way ♪ make the money ♪ break out

♪ you've got to find a way ♪ ♪ to make it safe today ♪ brake the money out ♪ bring it back and make it safe ♪ ♪ chairperson chu: any other speakers that wish to comment? seeing none, public comment is closed. and to the speaker that spoke about the difference between the revenue bonds ended geobotany, the bonds we are speaking primarily about -- and the geo bonds, but what we're speaking primarily about today are voter backed bonds. you're correct in indicating that there are also revenue bonds that are possible to be issued and the puc has the ability to do so. the puc is proposing to move forward with a number of revenue bonds to pay for sewer repairs, for example, that will be becoming -- will be coming

before the board of supervisors. those will move forward without having to go back for a vote as long as two-thirds of the border supervisors actually vote for it. if you have additional information, perhaps not yet can follow up with -- nadia can follow-up with you after board to clarify. in addition, the items we are taking today, which is authorizing the sale of the bonds as well as allowing for the appropriation authority is simply that. it is allowing the city to go forward with buying the bonds or issuing debt and then it allows it -- us to spend it, basically. the city will not issue the debt before we have something to pay for. for example, if we are not ready to pay for -- if we have not started construction, we will not borrow money up front. that would be too much money in terms of interest payments that we would want to avoid. if you want additional information about the policies that we move forward with and i am sure nadia's office can

provide information to you. thank you for your comments. colleagues, we have items 5 and 6. do we have a motion? we have a motion which recommendation and we can do that without objection. thank you. please call items 7 and 8. >> item 7, a resolution of -- approving the authorization of purchase and sale agreement between san francisco and a third party of the sea wall locked in exchange for a portion have a third property. item eight, a resolution

amending resolution of intention to establish infrastructure financing district no. two on number 120128 for the city of san francisco. chairperson chu: thank you very much. we have called both items. item seven pertains to sail. eight pertains to the creation and infrastructure financing of the district i st. both are related to the sea wall lot 53. we're joined by the president david chiu. we're joined by a number of speakers. and the department will provide a presentation on both of these items appeared before we begin, supervisor chiu, what do you have any comments? supervisor chiu: we had a question about whether we have received of the documents that

the port commission had reviewed in front of us. there were issues raised about pala the documents that were considered by the port staff and the port commission were not specifically put into the file today and i just wanted to ask if anyone had a perspective on that and why that was the case and what we ought to do with that given that we do not have everything in front of us at the moment. chairperson chu: thank you, president chiu. we did receive an e-mail indicating an electronic records, court documents provided a electronically on our website. if i could ask the city attorney who has also reviewed that email, could you respond to that? gregg's madam chair, deputy city attorney, cheryl adams. i think the question posed was a little bit different. it was whether the agenda had to

have the electronic versions of all of the documents that supported the file. the ordinance does not require that. it requires that the file itself be available for public inspection as to the question -- for public inspection. as to the question of what documents you do and do not have relative to the port, i do not know. i cannot speak to that. president chiu: i think we received some high-level documents relevant to today's discussion, but there were documents on file that the board staff reported to the commission that are not in front of us today. if the board were to approve our decision, we would be a blessing those documents that are not in front of us. i would like to raise that as an issue that we can discuss but through the course of the hearing. chairperson chu: with regard to moving forward with our items

today, item seven and eight, d you see any problems continuing forward based on the conversation today? >> based on the conversation, i do not. chairperson chu: president chiu, and you have any other comments? why do we move on to the presentation. -- why don't we move on to the presentation? >> my name is jonathan stern. i am with support staff and development group. i am joined by the project manager for this development project. our cfo and special project manager and executive director as well. i will make a brief presentation and all of us will be available to answer any questions the committee has. i will briefly present the project over all and then the fiscal and financial benefits to the port and the city. maybe i can take a brief moment to try to address the question posed to court staff by

president chiu. maya understanding is that lodge with the board are all the documents pertinent to the board's approval. and some primary documents that i believe are not in the file are the development and disposition agreement, the d.a. -- the dda, which is under the purview of the agreement application. i would have to defer to the city attorney for a more in- depth definition. but that is minor standing of the lay of the situation. president chiu: in the past projects that we have considered, we always do review the dda. i do not understand why that was not something provided to us as part of today's proceedings. >> i will have to defer to the exact legal reasons for that under the court jurisdiction. but having been part of the

exploratory and project, the dda was not considered part of what would be forwarded to the board. president chiu: that might just be a port issue. proxmire understanding is that it is under the port -- the purview of the port commission. but there are other policies that are under the purview of the board and that is what we have here before you. president chiu: i can ask the city attorney. do you know why this would not be considered a critical document for us? >> i think there is a difference between being required to provide it to you and whether it is before you. i think the port is saying that the dda is not something before the board for approval. president chiu: even though it can't -- it includes some of the key financial terms we have before us today. gregg's -- >> is a resolution of intent to form an isp.

>> moving on, i wanted to briefly present the project in front of you that was approved by the planning commission and port commission and and talk about the financial benefits. this is the area of the waterfront as envisioned by this project overall. starting out with the current site, the current site is a combined site made up of fuel lot 3 havret 51, a 90 + persons bait -- a 90 + space parking lot, and the area formerly known as the golden gate tennis and swim club. it is currently operate -- operated by the western athletic club association. there are few buildings on the site. we engaged in this project for the furtherance of the water of front pléneuf sport, which calls for the combination of these two

projects -- properties to contemplate residential uses , both residential uses351 and this lot -- both on lots 351 and the area next it. this is a particularly important area of the waterfront. currently both jackson street and pacific street that and into the current uses and do not allow the neighborhoods behind them access to the waterfront. but project envisions opening these streets apple to provide access -- these streets up to provide access at three different places to the waterfront. the public space is shown here in dark green.

that is another important benefit that the port is seeking with this transaction. there will end up being a public/private ownership with private residential uses on it. we believe this was a good form of transaction that allowed us to negotiate for a public benefit package with the public agency given the land that we on to negotiate with for a decent package. the overall uses include 134 housing units in two buildings between washington, jackson, the embarcadero, and drums street. it is one to three city blocks of the project. a second block at pacific prostitutes -- constitutes the swim club, doubling the pool space of the current facility. and then a third block is a

smaller block transformed between that part and broadway and the embarcadero. there is about 30,000 square feet of public open space. on the ground floor of both the residential building and recreation facility, there's about 20,000 square feet of restaurants, cafes, and retail facilities. there's a 30,000 square foot aquatics center. there are 255 underground parking spaces, or up to two hundred 55 spaces. -- 255 spaces. there are lanes for bicycles and commuters. the waterfront is transformed from a blank surface parking lot to a number of uses along the embarcadero. and the inclusion of the public realms recommendations from the northeast embarcadero steady for activating and beautifying this

portion of the waterfront. as i mentioned, but public parking is an important consideration for this area. in 2009, there are approximately 200 parking spaces within walking distance of the ferry building. based on a number of proposals at the proposed project at 75 howard, and most notably, the removal of certain spaces along the embarcadero on the waterside at the plaza, appeared two, and pier half, there are a number of spaces that are proposed for been removed. we also have commercial obligations with our partners cannot at the ferry building and at 1.5, 3, and five. our goal is to provide permanent parking for this portion of the waterfront. this would allow us to remove parking over the waterfront and deep water area. about half of the existing parking is potentially being

removed in the next few years and we see this as a permanent solution to parking. moving on to benefits, overall we are speaking of a public benefits package in the order of $145 million on a present basis. the first is inclusionary housing fees. the base housing fee and the city's housing fee ordinance is about $8.3 million. the developer has agreed to additional payments above and beyond this, totaling -- bringing of the monies for affordable housing in excess of $11 million. president chiu: if i can as just a quick question. i know the affordable housing and remove from $9 million to $11 million. my understanding is that the money was money the port was or to have to repurchase for this, correct? rex the developer's agreeing to an additional $2.2 million in

additional housing fees. we did negotiate the sale agreement that is before you. and we restructured this, and his sense of removing the two million dollar up front guarantee. by doubling the back and participation for a transfer fee on commercial and residential condos and increasing the net present value of the compensation package. president chiu: i understand it is accurate. it was a little confusing. what i'm trying to get that is that in order for the developer to say that additional two million dollars is going into affordable housing, you changed a lot of financial terms, essentially not requiring the developer to put of $2 million as was previously required in this deal. >> the terms were negotiated and the two million dollars fee was removed from being a fraud. in exchange, the port