consider to be future lost revenues at sea wall lot 351. supervisor chu: the value of the park lands? we have heard consistently from the port it's worth $12 million, but the budget analysts has $8 million? >> aide was the -- $8 million was the appraised value we are told there was a strip of land, about 9000 scripps -- 9000 square feet. we have no way to calculate that number. this does not account for the $7 million loss that would be transferred to the developer. chairperson chu: the budget analyst recognizes there was a strip of land and did not have a parade -- an appraisal with it, so you did not include that.

and going down to the park lands with the difference between the ports numbers, what is the difference there? >> i believe, you're talking about the difference between the six multimillion-dollar sandy $12 million for the improvement -- $16 million and the $12 million for the improvement? >chairperson chu: know. >> the project costs are the best that we could come up with in the discussions. that is the basis of our review. chairperson chu: so, it sounds like an earlier version or a preliminary estimate versus the later estimate. that the discrepancy that we are

seeing? >> correct. chairperson chu: in terms of the ongoing maintenance component, you have laid out very clearly that it is about $100,000 or more for park maintenance. that is the value, but it is not covered in the budget analyst report? >> we did not have the information at the time. we talked about the maintenance agreement and that the developer would have that responsibility. these will be paid for by the consumer financial responsibility district. but we did not have that at the time. chairperson chu: and necessity for the garage parking the, the budget analyst did not have that counted in the benefits, but for you, you have about $60 million. >> that is correct. given the fact that it is

largely for filling our contractual obligations to provide parking in this area, we thought it was appropriate for consideration of this committee and the board. chairperson chu: and if you were not to fulfill your contractual obligations through this, you would still have 150 parking spaces + the 175 contractually obligated parking spaces that you would not be able to fill. what would be poured be doing to fulfill that otherwise -- what with the port be doing to fill that otherwise? >> we would have to continue parking over water in its vicinity, or we would have to construct similar facilities at a similar cross. >> and i know that supervisor chiu spoke to the fact that he does not necessarily see the public parking garage at a public benefit. i do think there is a need for

public parking spaces and i do think there's a benefit for the public for it. >> specifically in your district. i anders and the difference between the budget and the analyst -- i understand the difference between the budget and the analyst report. but it does sound like that is a public verses private facility, correct? >> correct. >> thank you. supervisor chiu, did you have additional questions? brecht's president chiu: unfortunately -- president chiu: unfortunately i do have a speaking engagement that i committed to some time ago, so i will be going. i want to thank my colleagues for your consideration and the city staff and everyone from the public involved. gregg's thank you, president chiu. to the -- chairperson chu: thank

you president chiu. there were ongoing items that were not necessarily captured in your report, i believe. >> they are calculated on page 18. chairperson chu: but they are not calculated in the 144 vs the 63. you are capturing that separately? rex i think we're talking about the $14 million -- >> i think we are talking about the $14 million that they have their calculations. we calculate $12.4 million. you can see it on at page 18 of our report. the one time $1.3 million. the revenue from the 66-year ground lease.

subtracting out from that would be the revenue numbers. that is a different spirit chairperson chu: i wonder if the port might be able -- that is the difference. chairperson chu: i wonder if the port might be able to clarify the contract different. can you speak to that? >> there are a number of examples, specifically the bart land that has been approved. i do not think it's a unique or new mechanism. it has been considered since the last time the board looked at this. with that, with the city attorney like to add any legal

announcements? rex madam chair, a deputy city attorney cheryl adams. we do not consider the transfer teach -- transfer fee to be a tax. we consider it to be enforceable. it is part of the transaction and a term of the sale. chairperson chu: supervisor chu, are you on the roster? supervisor kim? supervisor kim: i think it is a little disingenuous to include a private club as a part of a public benefit of the value. i would disagree with including that in the public's memory because it is not open to the public. putting the $12 million value should not be included, because we're also giving the value of a

parcel that we are exchanging. >> if i may speak to that, supervisor kim, first of all, i agree with you that this is a gray area. the $12 million of improvements -- not land, but improvements to the facility for a new poll, they thought it was germane. maybe it should be put outside of the overall public benefits, but is still important to the area. some of the other differences are almost stylistically in terms of net verses growth analysis. you could say that i was trying to say that we are going -- for growing $7.3 million of land value. -- foregoing $7.3 million of

land value. in turn, the items not included, you could see that the 63 bases of profit for the public. that is pure public. and we have some disagreement about certain items that should be considered. >> i want to bring up what could potentially be a benefit to this private -- private recreation space. are there ways that we can have some public benefit in terms of recreational uses that are used by the city? what is being proposed is a summing pull. i think we have roughly nine or 10 swimming pools provided by the city. what is the gap that is going on here? i know parks and rekha -- rec

and park's could not be here today, but they said a half 1400 kids on a waiting list for swimming lessons because the number of pools are limited. is there any commitment at this point either from golden gate or the developer in terms of what we can give back to the city in terms of this being a new swimming pool that is built in? is there any way for it the use who want to get a swimming lessons? >> this has been an issue under discussion between the developer and rec and park. i would like to refer to my private partner for discussion. -- a d for two my private partner for discussion. but -- i would like to defer to my private partner for discussion. >> in response, we would like to

clarify we are not partners with the seller of this land. and we are not partners with the others. we are happy to accommodate the request. we will contact the seller and the residual owner and the athletic club. it is a very good idea of something we can do chairperson chu: i do think that golden gate is a beneficiary of this as well prepared -- as well. we do have 1400 kids that are on a waiting list for swimming lessons. maybe we can figure out how to accommodate that gap with efforts going forward. i would like to see that as part of this deal.

>> we will get back to you. chairperson chu: thank you. my second question was on the two other recommendations brought output by our budget analysts. they were the request for the port to negotiate the minimum annual guaranteed by which is required for other agreements between the port and the developer, and the second agreement of money for the lost parking revenue. i'm not sure who can address that, but i think those are valid recommendations that have been brought up from budget analysis. i'm not sure if there is a response to that recommendation clacks we concur that those are valid recommendations -- that recommendation. >> we concur that those are valid recommendations to the overall transaction before you. we believe our partner is amenable to negotiating the rent.

in similar cases where they leased the grounds for the facility for the long-term lease, and i believe the construction time frame is something that the partner is also amenable to. when we first negotiated this project from our -- we came close to covering our current expenses, and the passage of time is what created the imbalance. >> the fact that this has come up is because we have been delayed for six years. we will be happy to sit down and

talk about that promote the amount of money and the benefits. chairperson chu: thank you. if there are no questions for the budget analyst or to report for the project sponsor at this time, i would like to open it up for public comment. i will read the cards off any order they came in. if you hear your name, please line up in the center aisle. for each speaker will have two minutes. >> can we please have three minutes? people have been waiting for two hours chairperson chu: sure, we will give you three minutes.

>> madam chair and members of the committee, my name is eric. i'm here to recommend, or suggest that this is not a very good deal for the city. i'm strictly a volunteer here, but i wanted to give you my perspective on this deal because i feel like it is somewhat mr. jett -- misrepresenting what is going on. this is not a mission bay deal.

this is a proposal to destroy a community, at page very vibrant community apple people who can actually -- a very vibrant committee of people who can afford outdoor recreation facilities. the developer is asking for major facilities in terms of height, rezoning. they are preparing to aggravate -- replacing the tennis court

with a soaring poll is of no benefit. currently, the club is within reach for most people. and when it is all said and done, it will be out of reach for most people. there will be a lot of profit for the developer in this deal. providing public goods for this deal is completely unreasonable. do i still have 30 seconds? thank you. the other aspect that i want to bring out is that we are

dealing with people who have avoided -- legitimately -- using loopholes to pay taxes on the transfer of the project. please look at the financing for the second transfer in the transfer fees. chairperson chu: aye. -- chairperson chu: thank you. next speaker. brecht's i'm here on behalf of the housing action coalition. -- >> i'm here on behalf of the housing action coalition. despite the payments, which we think are complex and a pretty extraordinary for the city, what

is really before you is a simple land use decisions. what becomes of seawall landfill 3 havret 51? -- 351? does it remain as it is for the city, or is it preserved as a set of parking lots with its own set of financial realities? the financial benefit of most interest to us is the first $9 million housing in san francisco. that is the equivalent of a 25% inflationary rate. are you getting a better rate than that? particularly as housing has collapsed and subsidized housing is collapsing and a national level. this is serious money and is as

close to being broke as is possible. this is an enormous benefit to the city, in addition to all the others. there is one outcome here that brings a lot of design changes and benefits and financial benefits to both the port and the city, and there is one that does not do much of anything. it preserves a surface parking lot. i would urge you to choose the one that brings the most benefits to the people of the city. thank you. gregg's i am alan. i would like to also echoed his words -- >> i am alan. i would also like to echo his words. there is tremendous benefit to the city with this plan. this project has borne the burden of seven years of delays and needs to be approved as is. 8 washington is a model for how the four shared work with private enterprise to add

tremendous value to the standalone lot. for the future, the port and city will benefit from this combination of private developer with the port. the 1% transfer fee associated with each unit is a brilliant idea. the board gets to participate in it, the upside of the sale, and the revenue stream goes to the port. there are tremendous benefits to the city, and we need to retain jobs, have people move here. we have been reading over and over again that there is a huge shortage in the housing rate. the fee that will be paid equates to about 25%, as well as significant taxes. this is a great deal that to be accepted. it has been almost seven years

and i encourage you to go for it. thank you. chairperson chu: thank you. next speaker. >> my name is o faughz eriksson and -- my name inspect oz eriksson and i am the chairman of the emerald find. we provided development of the hotel. before we developed the vitale it was a parking lot, a new bus parking lot. and it was pro-family ugly. when munich -- it was profoundly ugly. when muni came to us, and we responded with four or five other people and we won the competition to get it, we were

very, very strongly opposed by well-meaning people. ralph moral said -- ralph morrell oppose the project and that it would cause disruptions. to the best of my knowledge, it was no disruption to muni. we ended and at the parking lot in an incredible part of san francisco. and today, we are paying the city about $5 million a year. it is a huge positive net gain for the city. i would also note that 2011 audit figures come out 2012 was not a good year for hotels. 2012 has been much better. this is a very positive, long relationship for the city and i think it will happen with 8 washington as well.

>> supervisor kim, there's a quick question. supervisor kim: i'm glad that you are a year. we are just talking about the site that you are developing i was up -- you are developing. i was hoping you could address my earlier question about what proportion of the cost of what you are developing at the site you are getting reimbursed for the funds being utilized. >> if i understand your question, the total costs are about $36 million or $37 million. i believe is half and half, half is coming from the arena fees and half is coming from the i s d. supervisor kim: ok, thank you. >> good afternoon.

i'm here on behalf of the ferry building. today i'm here to talk about the elephant in the room, the continued failure of the city to honor its obligations to the very building in connection with the proposed 8 washington project. for 10 years 8 watch it -- it has been the jewel of the ferry building. when gop -- eiop entered into an agreement with the building, they assured that there were be dedicated parking dedicated lost351. the proposed project remains inconsistent with its commitment. it takes seawall lots 351 and gives it to its partner.

the port has still not offer a proposal that would meet the city's full and immediate and long-term obligations under the parking agreement. it is premature for the committee to make recommendations on this new project until the city has fully satisfy its obligations to a form that is legally binding on the city and the project. otherwise, the city would be is honoring its prior commitment to the ferry building. we respectfully -- respectfully request that the committee not act on this project at this time. if more time is needed for discussion and dialogue between eop and the port and the san francisco water partners. nothing in this project is so important that it would warrant for the city breaching its agreement and risking the economic vitality of the ferry building. chairperson chu: i want to welcome the previous city attorney, louise reni.

b. brown, it looks like. ernestine water whites. -- weiss. go ahead. >> good afternoon. i am an architect and principal in a firm located in downtown san francisco. for years, i worked on the embarcadero and am familiar with the challenges it presents. i am pleased to be here on behalf of the many individuals who worked at for was the four years to support that thoughtful development of the waterfront communities. chairperson chu: can i ask you to pull the microphone closer to you? priced to be sure, a parking lot surrounded by green and in does not belong on the embarcadero. san francisco citizens deserve the right to have the opportunity to find real purpose uses along the water's edge.

a need to continue to evolve with dignity and grace. remained difficult, but there is no question that the sound principles, a historic sensitivity, and connectivity between neighborhoods in the bay are all important things. the city must work to ensure its success, and this project as just that. after several years of planning and design, public participation and city approval, there is now they use from the embarcadero to the waterfront preserve. mixed use for the public, a new health club, aquatics facility, 1000 -- approximately 30,000 square feet of new the developed open space, and let's not

forget the common area through the embarcadero. it parking spaces will be developed -- provided. and let's not forget the density of this residential development with an estimated total public benefit of $145 million. this project should be improved -- are approved. thank you. >> my name is michael mckenna. i am from the electrical workers local 6, representing a 2500 members. i am also a san francisco resident and native. to this point, i've heard about costs of city budgets and stamped approvals to expand more money to general hospitals and general projects. we get to the question of increasing revenue to the city and it becomes a very large discussion.