want to proceed. >> thank you, supervisor kim? >> thank you, director ris -- ris khan, and i did appreciate the letter came to us responding to our questions, i thought it was incredibly thoughtful and while they did answer a lot of the questions i had last week, i think it's helpful for the sake of the public if someone could walk through the letter and in particular, even though you said you would be before us today regardless of this real estate master plan, i think having an understanding of the context with which this lease is a part of is important, and it would be great if someone could talk about that, i thought the goals are helpful and the understanding of why this lease was important and talking in a little more detail about the alternative sites that you looked at given kind of what i perceive as not the greatest price for this lease given what we were paying before, but completely understanding your concerns about pier 70 and its working

conditions, regardless of whether you could stay there or not. >> i would be happy through the chair, i'm going to start and provide the context from the perspective of this master plan and then i'm going to ask our real estate manager to walk through the sites they looked at and the other questions you had asked, so again, we initiated real estate master planning study earlier this calendar year or maybe even late last year and it was in recognition of the fact that we have a lot of real estate assets around the city that they are by in large not in good physical condition and that they are servicing our current fleet of about a thousand vehicles which we expect to grow over the next 20 or 30 years by 20% or so, so another 200 vehicles that we're going to have to accommodate and service. so, with that as a context,

also with the fact that there is some lease space that we currently are in that we would like to continue the process we've been making to get out of wherever we can, we did a competitive solicitation to come in, we are at the final stage, we have a final draft that we'll be bringing to your board i think in the next month or so, we're skenl puling meetings with officers who are interested, so the reason why we've been a little bit coy of putting all this out there, there's been some stakeholder vetting and processes including your offices that we want to make sure that we walk through before we put out publicly what we found to date. the good news is we went into

the master plan with the assumption based on the 20% growth in fleet size, we would need roughly 31 acres of land to accommodate our current and future needs. what we've come to the conclusion of so far with the draft final report is that assuming that we have this 12 acres that's the subject of this lease in our portfolio, we would need 0 additional space that by reconfiguring our existing space, we can accommodate current and future needs, again, assuming this lease is in place, so where this lease and this property comes into play specifically in that context, there are a series of moves that we'd be making to realign the operations to get more efficiency out of the spaces we have which is how we accommodate more vehicles nr the footprint, the leading

contender in this space in addition to the long tow training facility is [inaudible] which operates out of the presidio division, currently they operate out of an old administrative area, the actual bus driver training before they go on street happens out of pier 96 and it's on a crumbling parking lot that itself has a footprint that's not large enough for us to train all of the people in a class at the same time, so if you go out there, when the driving training is happening, you'll see there is a lot of standing around and one of our biggest constraints to improving our service delivery and not having open runs is our ability to increase our capacity to train people, this is our constraint at pier 96 for our bus training facilities

is part of our constraint in terms of opening up the pipe to get more people behind the seat on the buses, so the idea is to take the draft idea, take the training division and move it down to this facility, the bayshore facility, which would have the space for the division and much of the kind of field training before the operators get on the city streets, that frees up at the presidio decision so it could be redeveloped as a joint development project, that would -- within the zoning for the area, that would build private development that would enable us to rebuild that facility, it's i believe our oldest facility is the original muni head quart erps, the 100 year-old facility would allow us to rebuild that facility and retain it as a bus facility but move in our overheads line division which is in a masonry

building right down here on division street, which we need to get them out of because it's not a safe facility for them to be in. so, that's kind of how that move happened. there's many other moves that happened to make all of this planning fit, but that's the likely other use of the bayshore lease facility, and mr. rose is right, there's nothing that guarantees by entering into this lease, that that actually happens, but it will be the recommendation likely that comes out of our real estate master plan that we will need to make happen in order to make the rest of the plan work, so it will certainly be in our interest to make that happen. so, that's part of the -- that's an assumption that is currently in the draft master plan, there are other alternatives, it could be the enforcement division which is all in lease space currently, there are other needs, in the

short term, we might need to move our video shop which is currently on port property that we're going the need for the dpt signal shop which has to move out of the produce market footprint that mr. up dikes folks are working on, to make the port space available to them, we have to move the other shop. we certainly would rather own it and as you heard, we negotiated that kind of first right of offer, it should have become available for purchase but that's how it fits into our master plan, so if i may, i would like to ask ms. mcgary and walk through the specifics of the other properties and the other questions you asked and i'll be here to answer any questions you have. >> thank you. >> good morning, supervisors,

i'm senior manager of real estate and thank you for this opportunity to talk to you. would you like me to answer the questions or go through some of the visuals, what would your preference be? >> what visuals? what visuals were you referring to? are you referring to the attachments? >> yes, would you like to see those on the screen? >> i think actually just going through the questions, although the first visual might be helpful just for members of the public to see. >> to see where the facilities are? >> yeah. perhaps you can speak while -- >> this gives you an overview of the current facilities that we have, so there's a combination of light rail vehicle facilities, which are

at mme, green and cameron beach so those are both what we call lrv, light rail vehicles as well as historic vehicles, there's also overhead which mr. ris khan mentioned at the bryan street facility, there's the main bus facilities including at -- flynn is our articulated bus for diesels, [inaudible] is a new bus facility under construction, woods is one of our main bus facilities as well as kerk land, so these multiple arrows show the shifting around that would occur as part of the recommendations in the vision report. in addition, the vision report

assume that is we'll be able to get the bayshore facility in order to move out of pier 70 and to move training in there as well as other mta uses. so, would you like me to go over that? i know it's very complicate and had looks like an octopus but it's a complicated list of recommendations, again, to rebuild and better utilize our facilities. >> i think perhaps if i could provide some guidance to go through some of the point that is were covered in the memo because i know the mta will be back to us before december 31st to talk to us about the facilities master plan? >> yes. would you like me to move on to why we have to move out of pier 70 or have we covered that enough? >> i think just going over the other sites that you had considered. >> we'll talk about net present

value. >> those were the two questions. >> so, the net present value for the lease, we've looked at different ways, if you look at it including the building expenses for a ten year lease, it would be 21 million and for a 20 year lease, it would be approximately 38 million. if you look at it excluding the building expenses, which is reflecting the lease payment of 65 cents a square foot as opposed to 80 cents a square foot, the net present value of the lease for 10 years would be approximately 17.8 million, and for 20 years, 33 million, and for scenario 3, if you exclude the building expenses as well as what prologis, i'm sorry, what auto return pays for the mta for the lease, the net present value of the lease if ten years would be 2.9 million and 20 years, 16.2 million and i would like to point out there was a correction on that point for the net present value in

that scenario, we will send you a corrected letter, so we've looked at a long list of alternatives in various locations but first we had to have a list of criteria, what do we need in terms of looking at a facility, so we need today have approximately 13 acres just for the towing operations to fulfill its current location needs at pier 70, and we said it could be in san francisco or adjacent to the city in order to avoid additional transportation costs for towing as well as the public access, needed to be on or near a public transit for public access, it needed to have appropriate zoning such as m-1 or m2, and it needed to have an existing structure in good condition of about 200 thousand square feet for towing and storing of towed cars as well as for other uses and an appropriate neighborhood that would accept car towed movement and storage, as well as

acceptable environmental conditions to avoid significant remediation, time and cost. so, looking out there in the real world and the properties that we've looked at, there are some properties where owners don't want to sell or are reluctant to sell and it could take an imminent main process which would be very time consuming and costly, one example is a 12 to 13 acre property owned by the goodman family, they've verbally said, they might be interested in the 45 million dollar range for the land and that's quite expensive, in addition, we would need to build the warehouses, demolish the current warehouses xh have businesses, small businesses in them and then build new, so the whole project cost for that could be in the 75 million dollar range. another example is on michigan across the street from the

metro east yard and that's a business that supports 120 families, it's been in business for about 75 years, the owners are not interested in retiring yet and they're not interested in selling, so that's another one that we've actually talked to the owners. other properties have hazardous materials that need significant expensive and time consuming mitigation measures, one example is the petrol hill power plant, they put out requests for qualifications, it's requested that even though there are 22 acres plus 3 acres of submerged land under san francisco bay, that the time for the remediation plan could take until 2015 with the cleanup, it would take approximately 2 to 3 years so that doesn't fit with either the needs of the mta or the port in order to move out of pier 70 on a timely basis.

we looked at properties that are zoned m-1 and they don't encourage industrial use, one is on carol avenue, that's below hunter's point and although it's zoned m-1, it's in the fema flood zone, it has nothing there except for a [inaudible] scale, so it needs everything in materials of -- terms of being able to use it, the use of this property at carol avenue is not compatible with the hunter's point project, another one is a 3.7

acre property there's also other buildings which need demolition and construction, in addition, the property is across the street from residential homes. other properties that have been rezoned so they're no longer industrial or light industrial such as mission bay, portions of the southeast waterfront and then the port properties which are as the port knows very challenging because they have state trust which allows commerce navigation, fisheries and open space, so in order for the mta to take over a port parcel for a long term use, we would need to find other property and exchange it with a port which requires not only city approvals but also the state's land commission, the state legislature and the governor, so we've looked at properties which we can -- if you would like, we can put up the visuals of the maps, would that be helpful to see where some of them are? >> just go ahead.

>> okay. >> if you can hold on just one moment. we can do the visual one, thank you very much. we'll start at the top. okay. so, these show you -- so, basically the industrial properties at the plant, the property across the street from the residential area, the carol avenue, the area that we're looking at here, le paul avenue, looking further south

here, this is 2650 bayshore soit's on the border of san francisco and daly city, so here's the drive-in theatre, we understand daly city is not going to have those as industrial parcels anymore, they'd rather have them rezoned to -- it's owned by syufi, enterprises, the planning and redevelopment process is an urban street scape. okay, do you want to continue south? >> that answers my question. thank you very much, i think that that information is adequate. i did just want to ask a quick

question from the mta with regards to the tow fees. you break down what the tow fees come to and i just had a question because i know tow fees are generally very expensive, we see the contractor's towing fee of 200 dollars, the towing fee of 64 dollars a day and the administrative tow fee, the mta's administrative tow fee, can you explain the difference or what the administrative tow fee is, does that help you to recover lease expenses and if that's the case, then is the contractor storage fee sort of a duplicative item? >> we're governed by prop 218 in terms of the fees we can charge, we're more or less at 100% fee recovery, there's no duplication, there's the processing on our side that would be in the administrative

fees and there's the contractor's cost and that's what we're recovering. >> and then just i guess a question about whether or not the mta has determined that there's any way to reduce the administrative tow fee, are there ways to find efficiencies in that area to control it, can we get a better rate than 210? >> it's possible. it was something early on in my tenure that i got a question from the board of supervisors about how high our tow fees were, and as a result of my inquiry, i got at the time a more detailed breakdown, i asked to the extent folks had looked at ways of reducing the cost and basically the answer i got back was that this was as low as we could go and recover our cost, so with all of these things, particularly a fee that is so kind of painful to folks,

we'll certainly look both with we bid the contract and as we move to the new facility for any efficiencies that we could find, we certainly would like to be able to bring down this fee, it is extraordinarily high, it's adding insult to injury, not only did i get my car towed but i have to pay my parking ticket, we'd like to see this come down. we have not identified any specific ways of doing that at this time. >> okay, thank you. okay, colleagues, any other questions at this moment? why don't we open this item up for public comment. are there members of the public who wish to speak on this item, item number 1, seeing none, public comment is closed. colleague, we have the item before us. supervisor kim? >> i just wanted to thank mta for taking the additional time to really respond with a thoughtful memo on a lot of the questions and concerns that i had and other colleagues had

regarding this lease. while i still think it's not a great lease for the city, i do believe that there was a thoughtful process and due diligence that took place which is my concern at the end of the day, if we could not find something better, i think that that responded to my question and that was what i was searching for was the background information on that, i think the graphics were helpful as well, i do hope to see in the future that we are able to terminate some of our private leases as we move forward over the next couple of years, i wish we could have been more specific today on what they could -- they could be instead of what they could have been, a month ahead to when you're want tog share this with the board, for me, it was helpful to understanding your object t*ifr and is goals, the last comment i'll make is i hope we have some further conversation about the tow fee and why it's twice as high of

that from income city, and i understand props may subsidize through the general fund but i think it's extraordinarily high and it's something that is incredibly frustrating for people, especially the parking ticket, i'm not sure if that's a cost recovery -- hoping that may be a further conversation within mta. >> thank you, supervisor kim, did you make a motion? >> i'll make a motion to move without recommendation but i do plan on supporting this at the full board. >> thank you very much and i will echo the same comments on the tow fees, i think i was the supervisor who e-mailed you that question of how it was broken down when you first began your tenure there, so i would be interested to see what we could do to bring that down. supervisor avalos? >> thank you, chair chu. related to tow fees, i've heard from a lot of residents who

have had their cars stolen, that they have to pay to take their car out of tow, i wonder if there's a way to have a waiver for people to have their cars stolen because that's something they had no control over and i heard at least from three people who have had their car stolen and had to pay to pull it out of the lot and already there's a lot of financial strain on a household that loses a car, so just another thing to throw in there around tow fees. well, i want to thank the mta for coming forward and for their patience on this measure, last week, i expressed i would not be supporting this contract, i don't know where i'm at still, i do understand the mta is between a rock and a hard place in terms of trying to figure out how to find available land to do its functions, the car tow being one of them, i want to thank the budget analyst getting us

all worked about this and figuring out the finances behind this lease. i think it's unclear how i'm going to vote yet on it but i understand the real need of supporting something like that and i don't want to hamstring the mta, i know you have a lot of other work to do in terms of operations and we'll see what happens on tuesday, but i want to thank you for coming back this week. >> thank you, supervisor avalos, we have a motion to send the item forward without recommendation and i think we can do that without objection? >> [inaudible]. >> i think that we took them last week. >> [inaudible]. >> did we not? >> madam chair, members of the committee, to the best of my recollection, i don't think you did, the department, as i understand it has agreed with our recommendations so our suggestion is to still amend the legislation. >> okay. >> great, given that then, colleague, do swre a motion to

adopt the amendment as a whole? we can do that without objection and to the item as amended, we have an amended motion to send the item forward without amendment and we can do that without objection. final item, item number 6, this is a pretty straight forward item that allows the department of public health to submit an application for ryan white funding but do we have a speaker on this item? >> good morning. you see in front of you the request for an accept and expend or to apply for funding for ryan white, you see the amount, the total that we would request just to point out that that represents the largest amount that we received from the federal government from part i which is unfortunately about 8 or 10 years ago that we received this amount, so i think i'll be brief in my

comments, i'm bill bloom, i'm the corrector of hiv health services for san francisco department of public health and see what questions you all have. >> did you say it was the largest amount that you received for part a? >> yes, about 8 or 10 years now. >> and is that reflective of the shift of federal funding to that part as opposed to other parts because we've seen a reduction in ryan white funding? >> yes, it's a reflection of the total funding amount nationally versus the number of eligibility metropolitan areas that can apply, so the size of the pie did not grow at the same rate as the number of solicit taints. >> for this item, i believe we do not have a budget analyst report, i would like to open this item up for public comment, are there any members of the public who wish to speak on item 6. seeing none, public comment is closed. colleagues, do we have a motion to send this forward, and we can do that without objection. do we have any other items

before us. >> that completes the agenda. >> thank you, we are adjourned. (meeting is adjourned).