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. how is the existing fee benefiting the city today? i hear a lot of people talking about the benefit the private club is giving the city today. then i hear talk that a private club will not benefit the city in any way. the bureaucratic stall tactics and hurdles by the developers in the city create a stagnant and no-growth situation. parking has been discussed about parking for the ferry building plaza. it has been discussed about removing parking from the existing design because it does not need so much parking. how do these things balance out? the parking and unit costs all

increase the costs overall, bringing in more tax revenue for the city, much needed tax revenue. the exchange of seawall lot 351 is an existing surface parking lot and a private club. we are exchanging an existing parking lot for a brand-new park just north of this new development in exchange for six tennis courts. a brand-new park for six parking lots -- for tennis courts or a parking lot underground. that is the exchange. raising more revenue through i f p's enter taxation and all of the benefits being given to developers of low-income units seems to be more of a benefit to the city and what is existing on the spot right now.

i urge you to move forward with this and bring this before the rest of the board and continue to allow this project to move forward. thank you. >> good morning, good afternoon. my name is john stewart of john stuart company. our company has been involved with the affordable housing maugre then i would like to remember, or can. i'm here to look at this project and it shows a benefit yielding 34 units. he will see the developers also upped the ante to $11 million. this translates into $323,000 per unit. how can that possibly comport with the number of 34 units at 25%? you should dismiss your director

of the mayor's office of housing, which i do not recommend, because i think he is doing a good job. i think any moh executive will be able to leverage more than that. you are spending $320,000 per unit, you are getting zero leverage on housing. what ever happened to the tax credit? they were usually covered in our deals from 30 persist -- 30% to 50% of the transaction. you would never agree to a project where you have that much money going in per unit. you are going to be able to provide affordable housing for something between $100,000 to $200,000 per unit, depending on whether the developer gets 4% credit for 9% credit per different programs. i have just talked to several

people. b. will be able to provide -- you will be able to provide affordable housing at a much lower rate. unless something is really wrong at moul. -- moh. you do not have 25% here. you have double that amount. i am on the housing trust fund committee that the mayor sent out. the cover is there. $11 million is a lot of sugar and we need it. chairperson chu: thank you. next set of speakers, please. correct good afternoon, supervisors. my name is maarten -- >> good afternoon, supervisors. my name is marvin.

our group is responsible for a number of projects along north beach. fraguli, the language arts project at the intersection of broadway and columbus. -- particularly, the language arts project at the intersection of broadway and columbus, and the completion of the lighting project in washington square park. our main project is the rebuilding of columbus avenue to make it the boulevard it should be. all of these projects are working with other groups in this area to try to facilitate the successful completion of projects that we deem worthy. our group looks at 8 washington very welcarefully. the rev eight architects working on our board, including those working on the waterfront development plan since its inception going back 30 years and more after the collapse of the freeway on the embarcadero. we deem did very worthy we have

identified a number of community organizations who are in favor of this project among feel it is a worthy addition to the city. we have not looked at the numbers. that is really your job. when i was in business, which i did for a number of years, we would do a cost-benefit analysis. it is very simple. is it worth the endeavor to get into? there are tens of millions of dollars that are accruing to the city and to the port. i would urge you to fill out your obligations to be sure you squeeze every nickel out of the greedy developers involved here. and i would make -- i would urge you to make sure it that the greedy beggars on the four do not get any more than they deserve and that the city gets -- on the port do not get any more than they deserve and that the city gets as much as possible.

but we would urge your support of the project. thank you. >> hi, brian brown again. my executive summary would be very quick. it does not include a one forecast for jurisdiction. like the puc is to san francisco and like a wholesale is to the south bay, you cannot build the type of development. 8 washington fifth eminently into the category of buildings that must put -- fits eminently into the category buildings that must prove we have water. and we do not have that in san francisco. recently, the general manager came to you and said there were diversions and so on. that they could not meet their contractual obligations under

the 2009 water agreement. that is an interesting agreement. between 1984 and approximately 2008, we used 86 million gal. of water and the peninsula used 163 million gal. of water. this book, which is required by the water and management planning to mock the state says two hundred 39 million gal. per day. at that time, there was not as much attention paid to global warming. at this massive summit, which was negotiated in secret, a week before it was passed, they said they could supply two hundred 65 million gal. of water per day and they will give 800 -- 80

million gal. of water to san francisco. they were going to cut sbac from 86 million gal. of water from hetch hetchy to 78. we do not have the water for this project. the main underpinnings of state required, reliable forecasts is the arab and water management plan. -- the urban water management plan. there are four sections, including section 610, which says that a builder says, if you do not have reliable water, you cannot build it. let's see, verification of sufficient supplies, senate bill two hundred.

i say you cannot do this project unless you go back and do a proper availability forecast. it is illegal under state law. thank you. chairperson chu: thank you. >> thank you, supervisors. and thanks for the care with which i've been listening to your comments this morning. particularly on the cisterns. i never knew the capacity existed because i'd never witnessed it before, to analyze things so carefully. i'm speaking on the transfer of public benefit of the $5 million from a list of public benefits. and in particular, the last public benefit, the sports center, as it is referred to.

everything is fully documented that i have seen that has been presented. well, it is not all before you, as supervisor chiu pointed out, but everything is documented except for the pool. to quantify a benefit -- to quantify the value of a benefit that is not documented seems to me to be an improper action. i asked you to consider that there are documents that show the court has an option for probably as many parking spaces as residents have. and while there is documentation on all of the other structures, it is mr. fu and not any of the parties to these proceedings, who is supposed to operate its recreational facility. and i have never heard mr. fu talk about it, but the only piece of paper that obligates

him is generated by him and not accepted by anybody else. it sits in a file at planning and just said that mr. fu will operate this recreational facility for as long as he chooses to. there should be no payment made to the developer or to anyone else until such time as we have the legal obligation on the part of mr. fu to run the facility. this has been overlooked. i brought it up over and over again. no one seems to want to take into consideration that the land that mr. fu islands as a result of this transaction should be restricted to recreation -- mr. fu owns as a result of this transaction should be restricted to recreational use. this is no more