and be free once more ride, budget, ride upon your mystery budget ship and i hope you get a lot of very good gifts ride city budget ride upon america's cup mystery budget ship and i hope you get a great wind with a budget lift ride, budget good morning, supervisors. my name is ignacio castillo and i represent the laborerses local 261. and i am here today as a representative of laborers local 261 and also as a member. i represent a lot of folks here in san francisco, over 4,000

members. we'd like to get the opportunity to work on a lot of the work that has been performed to the america's cup. also, we are willing not only to work with the local businesses, also with the local contractors to help them meet the goals or the requirements of the prevailing wage order, the wages that need to be paid and be half of all of our members which he he a lot of those members are local residents, i'll work with them. we urge you to take the necessary steps to make sure everything works perfect and wages be paid correctly. thank you. >> thank you very much. next speaker, please. my name is frances patrick

and i wanted to clarify. are we talking about one item, item number 45* or item number 4 or both? >> right now we're talking about item number 5. you have two minutes to speak on whichever one you want right now. i want to speak on both, but i want to speak twice. >> you're welcome to come back. thank you. my name is sunset [speaker not understood], i was on the america's cup before the cup was contested in court. the team would have been a team of athletes and sailors with physical disabilities to compete on bar with no barriers for the america's cup. it would have been a time at this point. perfect. i resigned from the team as executive director in march of 2011 because of the lack of development going on in san francisco, california and the

united states of america. following my resignation, i paid the registration fee for african diaspora maritime. it would have been the first african-american team to register for the america's cup in the 162-year history of the america's cup. that team was rejected by golden gate yacht club. if you've read through the beacon economic impact report, you will realize that they admit the largest variable to their projections is the number of defender aspirant teams. there are no defender aspirant teams. so, we've heard testimony here earlier that there are merchants -- okay. >> next speaker, please. thank you, 33rd.

-- mr. chairman. i just want to let you know you heard from local employers. i gave a letter to the clerk. there were a few others who couldn't come in. i appreciate you including those in the record. >> thank you. appreciate you being here as well. next speaker, please. good afternoon, supervisor. my name is fernanda castillo. i'm not a business owner. i belong to a nonprofit business [speaker not understood]. this is an opportunity where we all have to check and balances what is going on from the get go of america's cup coming to san francisco. let's also not forget that not only do we capitalize on media, we capitalize on human capital. in many, many ways of resources.

the opportunity that this is presented to my little club has reached out globally. and the resources that we use necessarily that we function is now being broadcast everywhere and we have been slammed with inquiries, which is great news, wonderful news. we're not a business owner, but we're still going out there doing what we do best every saturday. now, again, we have all of the labor intensive that's happening here in the city. everybody wants a bite of it. it's a small bite of it, a big bite of it, whatever, everybody wants to be a part of it. so, what i ask you as a supervisor and leader of this community that human experience is priceless. keep that in mind. thank you very much. >> thank you. and next speaker, please.

thank you, supervisor. i'll be brief. manuel flores, carpenters 22. earlier last summer local 22 sat down with representatives from america's cup, mr. bob dillingham, mr. barkley here. and we had a pretty good meeting. we wanted this to meet, we wanted it to be success. ful. gave him a lease of contractors that perform temporary structures. i thought it was a pretty good meeting, but apparently that fell on deaf ears. i was taken back on that one. ~ we did send a letter out early on also to haar bin studios regarding all the workout there, the upcoming america's cup. i got no response. when the work did start, we went out there, i went out there and discovered this wasn't going right. on a lot of the contractors weren't even from around here.

things fell apart. that's when my investigation began. manuel flores and i presented it moving on to office of labor standards [speaker not understood]. so, it just didn't work. what happened, you know, this is what happened. you know, the issues, the workers, workers got hurt. that's what it's about. now we got to rectify it, make it right because it's about them. these workers, they travel, you know, they travel, stay in hotel rooms. you know, so, we want to make it right. from here on out, you know, let's do the right thing. let's get it going. letters that went out to live nations and to mr. bob dillingham to make this right for the proper prevailing wages are paid because that's what it's all about and it's all about the workers, very important. thank you. thank you very much.

good afternoon, norman pierce again. i want to speak on the -- my opinions about the fund-raising. i think you're kind of blending these two together. should i wait until after? >> actually i think it's best do it all together. i know you spoke earlier, we're on number 5 right now. so, the answer is this is about the fund-raising. >> now, yes. do you want me to wait until after or speak now? >> speak now. it makes sense to have it all together. it will be confusing. >> i know. thank you. so, my observation on the fund-raising effort and the issues that will be asked, i asked to have a little more of a civil tone towards this group. i'm a citizen. i vote for you supervisors, and i've been a little frustrated with your approach, your tone towards these individuals who are working hard to do the best job they know how for the

people they're responsible to, much like you are. but i don't appreciate my board of supervisors being so gruff and antagonistic towards people that come here to present their facts. i would request respectfully that we keep a civil tone and try not to use [speaker not understood] for mistakes that our citizen ships, elected officials have lacked the ability to follow-up on on their side. i know this will all be resolved, but i like a better, more civil tone. i've been among this committee many, many times and over the years it's gone up and down with the tone in this chamber. and the last three or four years it's gotten better and i want to see better progress on that. these are professionals that we're working with and they're doing a very professional job to the best of their ability to make this thing successful for

our city. a benefit is in the fund-raising part. i have a small business i just started across the bay. we have hundreds of people per day come through here all wanting to know when the america's cup is going to be here and it's basically because these people have been together and been working to promote this worldwide which is going to be a benefit for our city and our tax coffers and our general budget. so, thank you for your time. african diaspora maritime is in court and the new york state supreme court with an appeal, and i understand that there will be preliminary arguments in april. it's clear that kgyc, the acoc, oracle, san francisco lieutenant governor's office

used inflated reports [speaker not understood] and tried to pull off the largest urban waterfront land deal in the country. i think it's about time that serious consideration be given to postponing the america's cup. larry ellison has already taken warren buffett's giving pledge to give his wealth to charity. i think that it might behoove him and others to invest in this america's cup. and allow teams that represent billion of people on the planet, whether they be blacks, hispanic, youth, women, chinese, the commonwealth, to participate and also to create many more festival-like events around the country. and these, i believe, should be funded by the group of individuals that have promoted this america's cup. i really, really strongly wish

that everybody would start to read these documents, particularly the host and venue agreement. and some of the documents that are on the new york state supreme court website because truly you would have lost the better part of your embarcadaro had a person who lived in san francisco for a number of years not tried to register the first african-american team in the history of the america's cup and be rejected with very little due diligence. thank you. >> thank you very much. this is on the [speaker not understood]. yes, supervisor, joshua [speaker not understood], i want to speak on the other item. i actually disagree with the gentleman who kind of started off the -- moving into this part of the conversation. i actually really like the tone. i think it's very respectful. i think it's also reflective of something the gentleman may not know, but i think the board knows and we as community and labor advocates know we work

for hundreds of hours on this. we knew -- i shouldn't say we knew. we feared that we would be here once it was stuck in the good faith, once it was stuck in all the back and forth. we thought everything was fine when it went into the agreements at the board of supervisors a year ago. we thought we had a good understanding with the folks from america's cup that we all lost. what i like most about the tone, supervisor farrell put it out there, all this happened, where do we go from here? i want the boat race, but i don't want to see what we saw again. do not want to see it again. the penalties from the america's cup for the violations of the agreements will help to make sure and support the efforts to make this -- to work. and the fund-raising will be supportive of that. when you think about the fund-raising, i think it sounds like we're going to get close, maybe we'll hit the fund-raising which is great. but if there is a shortfall,

fund-raising shortfall to the city, then, ghosh, it really makes the court even more stringent we have to have local residents out there on the best paying job. not minimum wage prevailing jobs, apprenticeship. that's why i think the funding is something -- part of the funding conversation is that if the city is going to put out taxpayer dollars, let's definitely make sure that everything that is on the last item is fixed when we add those additional city funds because it will be better for the city and it will make the yacht, the races more exciting and just such -- everything that we want from the beginning, it will get everyone excited again. so, thanks again. >> thank you. next speaker, please. this is on the fund-raising effort. thank you, supervisor. andrew woods international arts festival. i want to follow-up on the last couple points. let's not forget the board of supervisors signed a $35 5 million deal december 14, 2010, two weeks later land use signed

$110 million deal. office and workforce development worked on that deal without telling you and brought it back the following year. i think your tone is entirely appropriate because this body is really responsible for holding the executive office in check. if we've seen what's been happening out at the mayor's office, it has really not been where it should have been, starting with land use and change in doubling what the deal was. we've been trying to hold them accountable for that ever since. in term of the deal itself and the fund-raising, i think it's appropriate and i thank supervisor avalos for calling this forward. this is the tip of the iceberg. if we believe what we read in the newspapers, mayor lee is now creating a nonprofit organization that will seek to court other major events here. i think we need to look at this event in its entirety. and see exactly what went wrong and a lot did go wrong.

i want to thank supervisor mark. he was the first to call hearing that were left out of the [speaker not understood]. they were an integral part as to why it would not fail in fund-raising goals and efforts. if you look at the structure of the deal, it was really unfair [speaker not understood] in that they should never have been left in the position to have to raise that money by themselves. they were pretty much left out saying, okay, we're going to raise $30 million to clean up larry ellison. who in their right mind is going to give money to do that? if the projections are lower, it was supposed to be $32 million cash. it wasn't going to be money taken from the hotel tax or from other business taxes. that money goes to the general fund for city services. and if they're coming back saying that money is going into their -- to making up their bottom line, you should hold firm on that as well. thank you, supervisors. >> thank you very much. next speaker, please. [speaker not understood]. >> you can submit into the record.

you've already spoken. thank you. any other person member of the public who would like to comment on the fund-raising effort? if you don't come forward we will close public comment on both of these hearings. public comment is now closed. now i would like to move on to the fund-raising effort side of things. i believe mike martin will provide an overview and then followed by perhaps the controller ben rosenfield accounting for the effort so far. i believe there may be a presentation about the economic impact report that as well, i'm open to hearing that. [speaker not understood] i'd like to get into as well. why don't we go ahead with mr. martin. and just before you start, i think -- and i mentioned this earlier, when we began the hearingv, i think it's important that we talk about the original fib tent around raising $32 million. it was to make sure we weren't

going to be using general fund dollars. that was the intent of it. so we talk about now we don't have to raise as much money because we're going to be recycling back revenue we get from the hotel tax and from revenue from the event and sales tax, retail tax into pay for putting the event on, reimbursing the city. that to me was not the intent we originally had in raising money through the organizing committee. >> right. >> thank you, supervisors. mike martin, america's cup [speaker not understood] from the economic workforce development. i'd like to get a brief overview, just a little bit of what supervisor avalos just alluded to in terms of the road we took to get here. i would suggest, supervisor, we have john [speaker not understood] from the bay area council economic institute here. i suggest you be the one to present the economic finding. we can have that back and forth with the expert. and i come back up to sort of continue the discussion with our budget. does that make sense to you as

a way moving forward? >> then i would like to get first a report on just where the progress is, the [speaker not understood] on the fund-raising effort. whoever the best person is to do that. i have a letter from the controller that summarizes that. maybe we can go to the controller first and then go on to the economic impact report. >> okay, that sounds fine. >> mr. controller? >> supervisors, ben rose not field, controller. would it be helpful to provide an overview on our update of the fund-raising efforts of the calc? we at your request, supervisor avalos, updated our analysis from about a year ago where staff from my office and the port with the help of the acoc reviewed written contracts, budgets and grant agreements to provide you and the mayor with an update on the status of their fund-raising effort. so, we issued that memo yesterday.

i have copies here. i believe each of you has a copy in front much you as well, that short memo. probably easiest to talk off the last page of that memo if it's helpful. and this provides kind of a side by side comparison of where we find the acoc's fund-raising efforts now in march of 2013 versus where we found in february 2012, just over a year ago. so, a year ago in our prior review, we found at that time evident either cash in hand or written evidence of pledges or commitments totaling $12 million or just over $12 million of which $800,000 cash had been received by the acoc at that point. we update -- we fast forward in time 13 months, we find the $12 million has increased to approximately 13.9 million. so, there has been an increase of 1.9 million.

and now 12 million of that 13.9 million has been received in cash. i should point out in both the prior report and in the current report the majority of funds received by the acoc thus far has come from the event authority itself in the form of first a concession agreement and now a loan that's now been modified now into a loan. so, the majority of funds received are, in essence, accelerations of future sponsorships or loans against future sponsorships. so, to point that out. to reference back to the host and venue agreement and the fund-raising commitments and language there, and others will correct me if their understanding is different from mine, but in that agreement the acoc committed i think endeavored to raise $32 million

to help defray a portion of city expenses associated with the event. i think that's the way the language there works. it established fund-raising targets for the acoc over the three-year period with a campaign of $12 million in the first year which our report in february 2012 kind of quote-unquote certified that they had met. and each of the secondv two years established an incremental fund-raising goal of an additional $10 million. so, versus those targets, we find a bit falling short of that effort in our most recent update. so, raising just over approximately $2 million versus 10. that was the goal, at least as outlined at the time of the host and venue agreement. our focus here has really been, i should say, a couple things has been really on the fund-raising so we haven't really -- we had this -- haven't reviewed expenses that the city incurred.

and i know that we'll hear presentations here those are declined. and we have also not performed a review of the economic -- how the economic benefits to the city and region have changed as a result of the changing expectations for the race. so, we've limited our review to the fund-raising effort itself. i should also say the number we're reporting here today reflects only pledges or cash that are documented at this point. so, of course, it doesn't yet -- it doesn't reflect cases or additional fund-raising i know the acoc and others are endeavoring to raise for the event where something hasn't yet entered into the form of a written pledge agreement or written contract, but it's maybe in a verbal state at this point. so, it doesn't mean we won't see more money. it's just this is what we can find evidence of as of today. >> thank you very much. if there's a member of the organizing committee who would like to talk about progress made so far and what we see. i know we've been at the podium

discussing this several times with a lot of assurances that we would be doing better than we are right now. and what do we see now, the prognosis of being able to move forward? >> thank you, supervisor, and thank you for having this hearing. i think it's timely and important as part of the process. as i sat here listening, my name is mark afoul. i chair the board of the america's cup organizing committee. ~ buell i reflect back where we started. where we were then when we were negotiating this deal to begin with was there were going to be 8 to 12 boats in the race and the event authority expected some 270 to $300 million in revenue for sponsorship. and at the time we had negotiated that the organizing committee would have local corporations and that the event authority would have national and international corporations. it became very clear after we

got in the field and started trying to make this whole package work that that would be confusing to the marketplace to have two entities going after and what constituted a local corporation, lead by local international, visa local international, et cetera. so, we struck a deal with the event authority that basically said that we would give them all a local corporations and we'd get 10% of the revenue. now, if they -- and we believed the 27 -- 270 to 300 million. frankly, i slept pretty well that night when we signed that deal because i thought we were looking pretty good. the reality is, and i'm not putting the blame on them. i think they honestly expected that was going to be the case. you have to remember that this race has never been sure before and it's a new kind of boat and there were a lot of unknowns and a lot of anticipation. so, having said all that, we've recalibrated everything. and you'll hear today from mike martin, i think, and others, that the anticipated costs have

gone down and the revenues expected are not what we had hoped. but i can tell you that the organizing committee, i've made over a hundred personal calls to generate philanthropic dollars. we've raised on average about a quarter of a million dollars a month over the last two years. that's a lot of money when you think of people giving from a philanthropic fund. and, so, without having those businesses, what we've reconstructed now and i have to express public gratitude to the mayor, is that now he stepped up to go after local corporations in cooperation with the event authority on which ones would be available for opportunities to raise money for the city. philanthropic -- >> [speaker not understood] a report on the mayor's efforts? >> i think mike or kerry can give a report on that. it's above my pay grade, supervisor.

but having said that, i also was reflecting on the fact -- and correct me if i'm wrong. i mean, we have done public philanthropic events to build the dabey center and other structures that relate to the cultural part of the city. but this has been kind of a unique opportunity. examine there wasn't any road nab. -- map. so we've learned a lot as we've gone along. ~ i'll be happy to relay it to the next person who has this job when mr. ellison wins this race and do it again. but having said that, i think that if you combine -- and you'll hear this more from the city side. when you combine the reduced costs, the continued economic opportunity that the economists are telling us, the money that we're currently raising, the pledges that we have and the mayor's efforts on the business side, that all total, i believe that the city will come out whole. now, if you want to get into the language of where we're

going to raise 32 million, the costs when we saw the big picture the first time could have been 50. and with the economic impact and our 32 could have made that happen. that doesn't appear to be the case any more and i don't think it's ever been memorialized. >> i would say, though, the intent around the 32 million was reimbursing city costs which was 32 million now. it's lower. i expect it is still the intent -- >> supervisor, i would not disagree with you that was clearly the intent going forward. but i still believe that the effort will be a positive effect for the city economically and that i believe that the city costs will be covered by that, by all those [speaker not understood] that i identified. with that, i can announce also that to the controller that i have 150,000 more this last week to add to the numbers. so, that's 100 in the door and a signed pledge for another 50. that's big stuff for us. we're working every day and i do want to remind this

committee that my salary is a goose egg and i put in about 40 grand a year of my own expenses to make this work. so, i'm passionate about it. i share your concerns, but as i say in the end, i think we're going to come out on top on this thing. and i think the races are going to be spectacular even with just three challengers and the ultimate event. we hear it everywhere. i just literally got off a plane that's why i was late getting here from new york city. i talked to people. there are a lot coming for this event. we'll keep at t. it takes lots of meetings and convincing people of the merits of it. ~ and i think that they see a positive result for the city. this isn't for the boating community for them, this isn't for larry ellison, this is for the economics of the city what we're driving this home with our donations. with that i'm going to ask kerry mcclellan if she wants to add. she's our ceo and frankly knows a lot more of the details on it if you have questions. >> thank you.