spot aquatic park down to the creek. of note is the cove downtown was filled by the time the port was established and that's when this map was created, but as you probably know, the cove waters go all the way to mont gomery and california street, so there's a lot of property dependent on the seawall. mission bay was rather sizable going all the way to the 280 extension. we have in our money to begin a robust study of the sea wall. our seawall particularly in the downtown area protects a number of very important assets of other city departments as well as bart and other agencies around the bay so this is a high priority for the port going forward. our capital plan remains probably as big as any departments. what you'd expect for an entity

that is 150 years old. we continue to be as creative as we possibly can to find ways to fund improve ments in state of good repair just to keep the port operating and self sufficient. our capital plan for the amount of money we need to stay in our current state of operation is about 1.6 billion and we've identified just under 1 billion in potential funds. about half of that comes from the port itself and half of that comes from external partners which i'll talk about in a moment. in the last five years we've been lucky to survive is recession fairly well. if you look at the blue line you'll see it was flat coming out of 2007 to 2010 and then we started to have some incremental growth so most of the growth numbers you see here really occurred in the last three years. we worked very hard to curtail spending in 2011 and 2012, so much of our revenues are

dependent on percentage rents. it's hard to predict where those will go so we rise and fall quickly with the state of the economy, unlike a tax backed entity where taxes lag. and we've been trying to invest as much about it as we can into capital. we've been able to invest $187 million into capital the last five years, 65 million of that was from the explore tore yum. itorium. very quickly in ferms of

mandates of the board, we are working hard to support the lde and local hire mandates. we've been very well on local hire as well as on lbe. we aufr three types of contracts generally and all of them are performing well above the allowances set by the contract monitoring division so we're prout of that. in terms of our capital plan funding comes, as i mentioned earlier, from port contributions and assets so that's a combination of operations and debt. and the external as we can. and other types of sources, but we still have a fairly sizable gap in being able to fund our ten year capital needs. of this funding source is spread out over ten years. it's not money necessarily available for today and has a high probability of being

available to us, but things change fairly rapidly. we work hard all the time to make sure we're financially stable. our budget proposal meets these policies and again, we are just very mindful of the trade off between or operating expensens and our capital investment and we're doing our best to program those effectively. all of our forecasts show us having to make did fficult decisions in the sense that operating expenses continue to grow faster than operating resources for capital so we're watching that very closely but we've been successful to date. >> do you mind going back a couple pages? >> not at all. >> just briefly the lbe stuff, in every case you've been able to go over your goals? >> yes. so we do three types of

contracts; construction, professional services and then three as needed pools. one is for engineering, one for environment and one for real estate economic. not every contract has exceeded its goals. to be candid we have a hard time with drudging, but we've been exceeding our goals. >> well, great, that's good to see that -- >> we're proud of that. we're not a very big department. this is not a lot of dollars going out the door, but we're working hard to make sure they're fulfilling your policies. i think that concludes my report. >> okay, thank you. any questions right now? thank you for being with us. >> thank you for having us. >> okay. we will open this up to public comment. does anybody wish to comment on item number 2?

please step forward. [singing]

>> thank you walter. >> i' been working on port projects for many years now. i just want to point out that in the discussion of the capital plan and the kind of deficits the port is looking at, the two big potential public private par ner ships we're trying to get done, pier 707 and seawall lot, a lot of the benefits, long term benefits for the port won't really even enter that capital plan yet because they're outside the ten year window.

they are really critical for looking at the long range success of the port and their abilities to sur vive. i think the port has done a pretty amazing job of getting things done in terms of parks, open space, rehabbing some his toric piers and they really need your support. thank you. >> thank you. any other member of the public wish to comment on item number 2? seeing none, public comment is closed. have a motion to continue this item to the call of the chair. >> can i just -- i wanted to thank monique and brad benson and the staff for helping me see the dilapidated piers from land and from sea and understanding important long term projects like pier 70 and mission rock and others as well, and i really appreciate

the community input that you try to take into consideration as you're managing quite a bit of very valuable property, but i'm appreciative of being able to see it firsthand and for keeping my office informed of the developments that go on with the complex projects you have. thank you for the presentation as well. >> okay. thanks as well. colleagues, can we continue this item to the cal of the chair? we have a motion? we can take without objection. thank you very much. madam clerk can you call item number 3. >> [inaudible] 460,000 in department operating to support the department's projecting increases in [inaudible]. >> thank you. i'm the chief financial officer for the department of emergency

management. before you today is [inaudible] to allow for us to offset overtime deficits projected in the current year. the department has already set aside salary savings as well as safings from workers services to a account for this deficit. we worked with the harvey rose office the last week to address questions and we're happy to answer questions you may have. any questions you may have now? >> can you go to your rourt please on item 3? >> yes mr. chairman, and members of the committee. on page 3 of our report as shown in table 2, the total projected 13, 14 over time deficit is $420,993 and on the top of page 4, we point out that because the department has a projected 13, 14 year end

surplus in mandatory fringe benefits of approximately 1 million, we've requested a mandatory fringe benefit cost is not needed so our recommendations on the bottom of page for are that you recommend the proposed ordinance to reduce the requested amount to 429,993 and return the funds to the general fund bald lance and you approve the proposed ordinance as amended. a: thank you. i understand dm's in agreement? >> yes, absolutely. >> thank you. i understand dm's in agreement? >> yes, absolutely. >> anybody wish to make public comment? seeing none, it is closed. and then the underlying as amended, motion by supervisor breed, we can take that also

without objection. >> i would like to request that the department submit the amended ordinance before 9:00 am tomorrow morning. >> we can do that, thank you. >> can you call item number 4? rjts it's a resolution consenting to the transfer to [inaudible] mission bay south area to the regions of the university of california as a tax exempt entity for the future development up to 5,000 [inaudible] and making [inaudible] findings under the california environmental quality act. >> okay. thank you very much -- is it tiffany, whoever's presenting, come on up. thanks for being here and talking on this item.

>> good afternoon, i'm a development specialist with ocii. i'll tart the presentation giving you ton text tabt site. as you can see on the slide it's outlined in red located in mix bay south on third street from ucsf current campus. it's about 4 acres and owned by affiliated sales force.com. as you know the item before you for consideration is the city's consent to the transfer of lot 33 and 34 in the south to the uc regions, a tax exempt entity as required by section 14.7 of the mission bay south owner participation agreement. the next slide gives you a quick overview of the framework that governs development in mission bay south. the south governed by the south redevelopment plan, the south owner participation agreement

with fossil, the mast er developer. ocii's [inaudible]. obligated to reimburse fossil for infrastructure using tax increments. ocii is also required to use 0 percent 20 percent of tax increments generated in the south. this next slide touches on dissolution law. oci can only continue to implement enforceable obligations, in this case affordable housing and infrastructure under the south opa and south redevelopment plan. as you know ucsf is now under contract to purchase lots 33 and 34 from sales force.

as a state agency uc is exempt from paying local property taxes, however, uc is still subject to third-party contractual obligations such as the south opa. section 14.7 of the south opa problem hints the prohibits the transfer of property to a tax exempt entity without the consent of ocii and the city to transfer without such an agreement in place. the primary intent of this section 14.7 was to ensure that the ability to fund construction of the infrastructure and affordable housing required under the south opa was not negatively impacted by the purchase or leasing of property by tax exempt. blocks 33 and 34 are currently subject to a pilot agreement

which requires a tax exempt entity to make these payments in lou of property taxes and make any required cfd payments. ieu of property taxes and make any required cfd payments. given its tax exempt status as a to make one time lump sum payments instead of annual payments over time as required by the pilot agreement. these payments are detailed in a memorandum of understanding unrelated agreements which were approved yesterday by the as follows. first an affordable housing payment which is a one time lump sum payment from uc toocii of 10.2 $10.2 million for pouzing in housing in mission bay south. this time to fossil, a payment

of $21.9 million for public infrastructure in the south. in addition uc has agreed to pay the essential taxes authorized under cfd which maintains the parks and open space and which helps public infrastructure costs. uc estimates these payments at approximately $10 million. ocii hired alh and regional economics to conduct an analysis that would have been generated by blocks 33 and 34. this [inaudible] calculation of $39.8 million is more than the 32.1 uc is proposing to pay, however there are other legal and policy considerations to take into account. as previously mentioned,

redevelopment dissolution law would be the south opa, only to amendments are found to be in the best interest of the taxing entities. approval of this transaction will provide meetly available funds for the production of housing and infrastructure in the south. this reduces the need for tax increment funds and act accelerates frees up property taxes more quickly. in addition there were a number of other benefits and considerations such as the potential consolidation of uc's other sites and uc's con tributions to the city's economy. i'd like to turn the presentation to laurie, to further detail these considerations. before i do that i'd like to note that there's a technical correction that needs to be made to the resolution.

right now it erroneously refers to sf block 33 and 34. they're actually development block numbers used in the south plan documents so we'll make that change. >> could you repeat that? >> wherever it says assessors blocks it will say 33 and 34. they're not actually assessors blocks. a: okay, thanks very much. >> good afternoon. i wanted to speak briefly to the benefits that the university is going to be general generating as a result of mission bay and this site. we are acquiring this property blocks 33 and 34 in order to consolidate existing operations at least and remote sites here in san francisco. we expect that we will be

vacating in the next two years over a little less than 200,000 square feet of leased space elsewhere in san francisco that is currently not generating property tax revenue for the city. as a result of our vacating those properties, we're estimating that there will be a net present value of $12.7 million of new property tax revenue flowing to the city that would not otherwise be going to specifically to mission bay, but be going to the general fund i just wanted

to speak to some of the ben efits. sgh thank >> thank you very much. anybody else want to keep talking on this project. any comments right now or should we go to many mr. rose's report. >> i think the department has clearly brought out the question that we have raised in our report. on page 9 in our table we show that the estimated pilot over 30 years is 39.8 million. the payments that you see would make the one time payments total 32.1 million so there is a gap of 7.7 million, so we

state on page where is that

32.9 million going if we don't do this? it would go to the former ocii, the [inaudible] agency. i think when i had been briefed on this it was uc didn't have to pay anything and this was kind of a gesture so maybe we can have a discussion about that. >> tiffany, for the record. this is a private property transaction. you see the state agency exempt from all local redevelopment regulations, but for this tax payment agreement between fossil mb, who's the master developer, they own the property and a subsidiary of

alex san dree y'all those tax payment agreements run with the land. it ran did not want to not file

for a tax exemption on the property it had to make these payments under the contractual

obligations. it is -- to your question, where would the money go? the money goes for affordable housing and infrastructure, and it is no small matter, the increase to affordable housing. what that means in mission bay, rather we can accelerate the affordable housing development. it matters and matters in our budget discussions with the mayor's office and community. instead of building one affordable housing project in mission bay through this tax increment we can actually build 235 units. the first one issuing an rfp, 100 units father mily and very critical the next rfb you'll see no our budget it's the only citywide capital project left in the pipeline to date right

now, new project for supportive housing and that would be in mission bay and it is those very payments from uc that actually make that happen. and then the parks, i think that's the sustainable streets, that's obvious those get built with no hit to the general. >> i guess two questions. one i'm confused more on upset here that the comment in my office before being briefing ed on this is they wouldn't have to pay anything if they didn't agree to this, uc could get off scot-free. if that's not true it's not true, but i don't appreciate the preefing i had briefing i had before. >> uc is a state agency. typically would not have to pay anything, but it is only because of this private tax payment agreement that flows

through the land from private property owners -- >> i was being briefed on this project specifically. i understand you weren't there. >> i'm sorry if there was any miscommunication on that. >> why 32 instead of 39? >> that's the number. the report is completely accurate and valid. the balance of that payment in ses sense essence is just property tax that goes through distribution. uc doesn't pay property tax so it's money that's left on the table, but it is a policy consideration because of the increase to affordable housing and consolidation. this will enable uc to consolidate. they are a vic tim of its own

success in mission bay in order to grow, expand. they're a magnet for bio tech. we didn't have it in the city in 1998. it is because of uc that it's spilled over to dog patch and the other parts of the city. it is because of uc that we have that those benefits. >>