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. i appreciate your taking on

this unenviable pledge -- >> thank you, supervisor. [multiple voices] >> thank you. >> thank you very much. >> mr. buell, before you go, you're on a plane, you were on the east coast early this morning, thanks for being here. >> yes. >> colleague, i was there at the beginning of the stages when the event happened with the authority, and the discrepancy between local authorities and national advertisers was going on. i know the targets are short of where they were originally. we'll get into the holistic picture of. this i do agree with mr. buell, commissioner buell, you have many titles at city hall. i just want to say thank you for your time and effort. colleagues, i think it's hard to see how much time mr. buell has put into this personally. >> i appreciate that very much. >> you have a lot going on. >> that's been expressed by the

other members of the board as well. believe me, it's been a great journey and it's going to be a great event. >> thank you for your time. >> chair farrell, can i also thank mr. buell, but also reiterate there was a commitment made way back in 2010 for this meeting of goxv of 12 million for the first year, 10.10 million for year 2 and 3 and i know you're doing everything you can. i want to make sure our general fund doesn't get hit and we are going to assure the public that the private funding will come in. so, that's my concern. and i'm hoping that you can explain that we're going to meet those commitments. >> supervisor, i share your concern and the anticipation. i would have to defer to the controller and the mayor's office about how tax dollars come in and what funds and how they're spent by the city. but i would remind you in even my greatest enthusiasm, i

always have the caveat, it would be our best efforts to do it. there was no way we could possibly guarantee it. >> and maybe ms. mcclellan can explain that $8 million concession agreement which is now a loan and how that operates as well. >> right, she can. thank you. >> thank you, good afternoon, i'm kerry mcclellan, ceo of the america's cup organizing committee. i'm going to sort of take these in order in response to your question about the opportunity for local corporate donors. we launched late last year a program called 1sf celebrating the cup, hiring two additional fund-raising counsel that had expertise with working with the local corporate community. and we're now in the market on that and have a number of verbal pledges. and i have to say that both mayor lee, but also lou ten an governor newsome and senator

finestein and leader pelosi and others are leaning into that effort. i'm optimistic that just as we have worked hard to bring philanthropy i in to find a program that is appealing to local advisetionv to support and help the city be successful, we have crafted those messages around what the city is creating around community and legacy benefits. ~ and as we have traveled from all of this being hypothetical in projections in 2010, we're now at the mid point where we can see what ha the city accomplished and capitalized on this effort around. the passenger cruise ship terminal and making the most of that, making the case the city is making the most of this. i remain optimistic that we will be able to cover whatever the ultimate is, and mike martin will speak to that, excuse me, in terms of the city's costs evolving. the controller has reported on funds not only received to date, but forecasted to date.

and i think in the report it represents that we are about another million one that is coming in pledges between now and january 14th that are going to go towards outstanding city expenses. that's this moment in time. not another day passing. we will had make progress on that front and we'll city planning to expand the program. we do shallv [speaker not understood], we have the 1sf donor program, and opportunities for donor recognition. all give a little [speaker not understood] bounce in our record which previously had been staying with us, [speaker not understood] have faith that the city is going to be able to pull this off. time and time again we actually demonstrated that. and the event authority has put life to this program as well and giving them -- we hosted two events quite collectively, [speaker not understood], we hope these events successfully -- people have a better understanding now when we talk

about why we have catamarans on the bay. -- >> [speaker not understood] the fund-raising effort. >> right. the creation of the fund-raising cup program has come from his vision of what that should mean. and we have been holding breakfasts with ceos that he is in direct participating in. he is taking meetings, and i refer to him personally but he is putting an incredible amount of energy behind this so people are responding. we're working with local corporate counsel to put together a fund-raising program. the person helping us put on the 75th anniversary working with the national parks conservancy which had a nice balance of companies that participated and individuals. so, i think we have the right model for this and i'm incredibly grateful for his support. >> has he won any pledges? >> he has a number of verbal commitments, yes, he does. >> and an amount? >> i would say they total right

now just over $2 million in verbal commitments. and it's our job to take those verbal commitments and translate them into tangible assets for the companies to see the value. i'll walk you down the example. >> do you know who it's from, are you able to say? >> we have not signed the projects so it wouldn't be prudent. we can go through the process. they're local companies, people deeply committed to the success. >> thank you. >> supervisor mar had a question relative to the transition of the payment in commission into a loan. you know, as chairman referred to, this has been an evolving process. and the event authority are our partners in this. ultimately this summer we had to sit down and recraft the arrangement. [speaker not understood] that was our priority. we sought to take the local market back. two event authorities, three

event authorities, sponsors are major sponsors here from the bay. there are a lot of other companies that we heard from directly that we're looking for a lower price point and another opportunity. under the prior deal, we were receiving 10% of whatever they did. under this arrangement as a specified in the controller's agreement, if the local corporate partner program is in part a revenue stream to pay back $5 million of that payment p on which funds come in, we cover the expenses of that program. and then 25% stays with us and enables us to pay city expenses and 75% goes back on that loan. it is a nonrecourse loan that expires on october 1st. so, we are doing everything that we can to support that program and ultimately succeed in full repayment. but we are nonprofit with no assets and god willing the america's cup will continue to be here in san francisco. i don't know necessarily the state of our organization, what will happen in future america's cups. we're here to support the city

in this one and our business plan is existing to receive funds through february, january, 2014. not only to make sure the city makes whole, but make good on our commitments. so, we are endeavoring every day to not only succeed on the [speaker not understood] front, but also on the corporate partner front. i can answer future other questions. >> thank you. >> thank you. >> mr. martin, do you have any other parts that you would like to present as part of the fund-raising effort? do you want to go into economic impact or not? >> the two pieces of presentation are economic impact and review of our current budget situation. i can take those in either order. i can start with the economic budget and go to the other after that. >> okay.

>> through the chair, mr. martin, do you have copies of the presentation? >> i don't with me, but i can ask someone to make them and bring them down. >> great, thank you. >> i'd be happy to. supervisors, just wanted to step up today and provide you with a current budget update. that is alongside the report you're getting on the fund-raising as well as the economic impacts. to similar comments made at the outset of this issue, it's certainly not my office's place to try to recast the agreement. the words are what they are on the page and we're frankly moving ahead to implement the agreement the board approved last march and again in september. we have been trying to do this in what everyone talked about as the san francisco way in terms of upholding the considerationses around workforce and small business that we already heard about

today as well as through the environmental review process and really creating a sustainable event that becomes a leader. all of that obviously requires resoartiones, but i realize -- we realize very acutely that it requires smart application of resources. we never looked at our $32 million as a blank check to write $32 million of checks. it is an amount to be fund raised and endeavored to be feud raised in best practices and best efforts. but we want to do this in an efficient way. so, on the screen here is a slide sort of looking back at 2010 and sort of prefaced previewing which you'll hear a little bit in the economic impact piece. the original bay area economic institute study shows under 1.4 billion of impacts, 8800 jobs and 23.9 million of tax revenues. the city's budget analyst actually came back and did a report for the board in december of 2010 that took its own look and provided a range of impacts, economic impacts

from 950 to 1.6 billion and had a lower tax bill of 9.5 billion dollars. i retraced our steps a little bit. while i don't want to recast the agreement, there was a level of break even analysis. [speaker not understood]. the $12 million cap there that obviously, unless fund-raising came in, and budget analyst expressed a caveat about that, that gap is what we're looking at. today we'll see information calling for a lower economic impact of $900 million as well as 13 million of tax revenues. again, you know, back last march we did a break even analysis and again i think we'll do again today a review of our costs and a break even analysis from there. but i understand certainly the outlook of the city is to make itself whole through what it believed was a fund-raising

program of $32 million and, so, anyway, i just wanted the budget information to be looked at in that context. so, this is slide shows our invoices to date, a total $8.37 million. we sent an invoice to this effect to the acoc -- actually, the last piece of this was approximately $3 million, i guess. we had already been reimbursed at the end of last year. so, the bottom three lines of the key for this slide we invoiced $8.3 million costs. we see reimbursement of 6.38 million at this point outstanding is 1.5 million. and that obviously will, with the good news being talked about in terms of further pledges coming in, that's the first dollars that that would go to.

obviously the next step is to look ahead. this slide shows expenses we expect in this fiscal year that we would invoice a lot of these have to do with some lingering costs from last year's events as well as things such as the port, some improvements preparing for next year's event. i do want to emphasize the lion's share had been funded from the port's budget as was reported to the board when we sort of brought the reconstituted agreement back last march. in addition, at the bottom -- the the bottom three lines there, i guess, the two lines before the total had been insurance and the cash collateral escrow as you may recall last september, we came back to you with a new approach to the security arrangement under the agreements. i allude today this earlier. i think we saved a great deal of money certainly on the event and insurance side targeting the insurance to those revised security plans. that was obviously a great boone to the project. in addition, the cash

collateral escrow, the next line down of $2.4 million, that's meant to secure the city's performance on its obligations in putting on the events. we fully intend to fulfill the obligations and it's there as security. but if it's not drawn upon it flows back to the city and is payable towards costs. i'll mention that again in the next slide to show how we've calculated that in. the total of these costs, total just under $10 million for the rest of this fiscal year. these are all projected costs looking ahead to next year. again, these are really revolve around operations for the events and preparing for and hosting them. there is also an amount for the national park service line item, $974,000. there had been a helpful partner in coming back to the table after the experience of last year's events seeing what

kind of secular impacts there were. we worked with them through the federal review process that the park land were protected and they have been helpful in identifying potential saving in the same way they were going to city departments how do we do this better and more efficiently. i think the schedule [speaker not understood] allows us to target our resources and the fact that these events are during the day allows us to limit city overtime as well. just to come back to the point on the last slide, the cash collateral escrow, i show that as the credit here, $2.4 million. that's again, assuming that doesn't again drawn on and comes back to the city to help defray costs. again obviously if some of those monies are withdrawn, that wouldn't come back in that full amount. we fully project we'll get that money back. with that credit it's $4.1 million for next year. this is probably the most variable slide of the ones i've shown. obviously it will reflect the actual efforts that are made to host the events. so, as spectator attendance

goes up, we'll also see likely an increase in costs for a lot of the operational things you see here. but at the same time as we'll talk about in a bit, spectators are obviously a driver of economic and tax benefits as well. [speaker not understood] from my office is handing out a slide presentation now. i apologize for not having copies sooner. so, as you see at the bottom, it's $4 million here. i want to go to a summary slide now. here's a total budget adding together the three slides you just saw of $22.5 million. i don't have anything to add to that. basically the sum. you'll see cash escrow is zeroed out between the funding to begin with and the credit back of those funds go back to the city. so, this last slide is the break even funding analysis that i talked about earlier. again, it's by no means meant to recast the agreement, but i

wanted to give a clearer picture, especially with recent reports and committee outlets about a $20 million hit to the general fund. i think -- i take it very seriously, the idea that the general fund funds a lot of services for people in the city and certainly a special event like this one should ben if youth the general fund and not create shortfalls elsewhere. ~ benefit projected at the top $22.5 million less the 6.8 million of acoc projected to date. tax revenue we'll talk about further in the next segment of this presentation. so, when you basically take that math equation, there is a remaining shortfall of $2.6 million, that's not to say that's all we need to fund raise. i want to be clear about that. i think we are clear from the acoc they are continuing to go out and seek further pledges to continue to endeavor towards the 32 million. what i'm pointing out here is

we want to be very clear with everyone, donors as well as people in the city hall here about what those benefits were to the city and this projection is not meant to make the case that $13 million is bankable, but instead to show how we would calculate what that benefit is going forward. and we intend to do additional visitor counts and surveys to try to give everyone from the controller's office to the board of supervisors to the budget analyst's office of what was delivered. that is a theme we've heard throughout the hearings today is we are delivering on the promises and letting people know what actually happened. i'd like that to be the frame of the impact answer and happy to answer questions. >> i appreciate that. there was maybe some concern expressed through public comment and about the paper as well all we had to do was raise about i think it was $3 million more and we'd be okay. you'd be able to recycle the revenue from the event back into this fund-raising effort and i'm not sure that was the intent.

>> i don't think it was the intent to say, let's stop there. i mean, that's never been something that i as a city employee am willing to do. the event -- excuse me. the host agreement set up a clear division of labor and i think our job has really been to support the fund-raisers, but to manage our budget appropriately. so, i was reacting to the idea that the full 20 million was going to be a hit to the general fund. when i think two factors are at play. one being the event hasn't happened yet and we had three months to sort of capitalize on the growing awareness and excitement about the event to hopefully augment those fund-raising revenues. and, so, i can say as clearly as i can now we're not stopping -- i do not want to see anyone stop because of what was in the paper to today. i want to see it continue and provides those benefits back to the general fund. >> thank you. i appreciate that. we can go on to the economic impact report. >> actually, supervisor avalos, can i ask mr. martin on the cash collateral escrow expense of 2.4 million, is there a possibility that it might be

higher than that, the need for that line item? i'm just curious how you came to the 2.4 million on that one. >> so, that number, 2.4 million is a sum certain in the agreement. so, basically that was negotiated with the event authority and that's part of what we brought back to this, to the board of supervisors in september or excuse me, october after we realized that the original security arrangements wouldn't work. so, that money is basically a backstop so that if we need to dee voight additional resources, that that money is there. now, ultimately, i think our intent is if we need to put more couldxtionv on the street or more buses on the street, we would just do that and that would be part of our variable adaptive budget. so, as i mentionedth earlier, the 22 million is dependent on how many spectator comes, what actually transpires. i don't see that 2.4 million changing. i see withdrawals coming out of that based on obligations the city has under the approved host venue agreement and the lease position agreement. what i tried to make the case

for was my anticipation, we wouldn't get to the security arrangement, we would do what we were supposed to do under the agreement. >> and from what the chronicle reported this morning, the spectators over a three-month period this year, instead of 2.7 million which was originally predicted is about 2 million people. i think a lot of our mta and the port projections are based on the adjusted numbers and that's what the bay area council is basing these on? >> the adjusted numbers, you mean the 2 million? >> correct. >> so, i will say there have been several i think the spectator projections over time. there was the ones for the economic studies. we actually did an even larger spectator count for the environmental impact report so we could be appropriately conservative from an environmental point of view so we had a super peak kind of event. we would know what kinds of mitigations we need to put in place to make sure the event came in place as we want it had to. this number is lower than both of those numbers. we think it's appropriate based on some sampling we did in

local -- in locations along the waterfront as well as the event authority's analysis of the carrying capacity of its venues. but obviously like i said i recallier, we're going to want to truth test this during the event to really understand how many people came and what kind of -- frankly help feed into our incident command system to allow us to adapt to changing conditions. >> i think that's the conclusion of this piece. should we move on to the economic impact study? >> just before you go on, we do have 1.5 million, mr. martin, left over in reimbursement after having been provided; is that correct? >> that's correct, supervisor. there's 1.5 -- of the 8.37 million that has been invoiced there is 1.5 outstanding. >> do we know when we're

getting that in hand? in hand cash to be able to provide or not? i think ms. mcclellan is coming now to answer that question. >> we are receiving 1.1 in pledges between now and january 2014. i can tell you right now i know in may we're getting another 700,000. there are two pledges that are coming in. at this moment in time i'll make another payment in may. when those come in we'll actively fund raise adding the 150 we made last week. as we get more tranches we'll make -- >> that's january will be paid -- >> before june 30th. before the end of the fiscal year. >> good afternoon, gentlemen. it's a pleasure to be here to talk to you about the updated numbers of the impact analysis. [speaker not understood].

what i've done recently is to update that report by way of including our understanding of the america's cup world that we have now that we didn't have back in 2010. is the presentation going to come up? so, back in 2010, most of what we had to go off of was the experience of prior america's cup events. since then the number of syndicates that are going to be involved has become much clearer, likely crowd sizes, perhaps clearer. the amount of spending by various organizations also clearer. so, this first slide provides an indication of some of the changes and assumptionses that we've made. the important one is a change in number of syndicates from 15 down to 4. we've changed the number of the amount of spending by the cup

management from about 196 million down to 150 million. most of it reflecting the fact that there are fewer syndicates. those who are directly involved with the event authority may have different numbers, but the best information that we have available -- >> did you have anything based on the experience we had of last year? >> with the world series events? no, we purposely did not use the world series events. there are a couple different ways of going in terms of forecasting the experience that we might have this summer. it was my considered judgment that probably still using the information from prior america's cup events is more relevant than using the information from the world series events. given that they are fundamentally events, especially in the sailing community, having attended an event in san diego as well as the event in san francisco, having been a 30-year follower of the america's cup, i believe that this event will be

fundamentally different, fundamentally larger in scale than what we experienced during the world series. >> so, essentially you've done like a percentage reduction overall in what we expect the event is going to be? >> well, not a percentage reduction. we've looked at the individual categories. one of the assumptions we had previously was there would be 40 [speaker not understood] yachts arriving in san francisco bay. that number was changed down to 10. we adjusted our spending, our assumptions about spending accordingly. our assumptions about spending are specific to the various categories. i'll show you what those assumptions are. so, this slide provide you with a list of different categories we included. there are others down there that include a couple of catchall categories. it shows you the change in spending for management, change in spending from syndicates given the vastly smaller number, the change in spending on infrastructure which in fact