out several projects in the neighborhood and added to both the housing stock affordable and market rate, and to the street scene, and the makeup of the local neighborhood. i'm here in support of it. i think it's a good project. i think it adds more housing in the city and a neighborhood where there is a shortage of housing. and you know, if these projects don't get built, the million dollar condos that have been spoken about today, will become two million dollar condos and it's a city that has got to have more housing. thank you. >> president hillis: thank you. next speaker, please. >> commissioners, good afternoon, john o'connor, the

project consists of 1425 square feet of commercial. there are 16 studios, 6 one bedroom and 15 two bedroom of much needed housing. this project is located along the mission street corridor and within the mission area plan. and it's consistent with the neighborhood commercial. there is no displacement of any business, residential or pdr, it's a vacant blighted site. the project provides affordable units. the project has been reviewed by our design team, the project sponsor purchased property in the early 2000s and filed application in 2006. the project was not allowed to move forward until after the adaption of the neighborhoods

due to the 2660 replacement policy in the spring of 2006. by the time the eastern neighborhoods was adapted in 2009, we were in the middle of a recession. and after that there was no funding available for smaller project sponsors. the project was proposed for a large project authorization, but the planning department withdrew the large project authorization because the mission controls had expired. the project sponsor has met with the appellants, but they are close to agreement, they haven't reached. numerous letters in support of the project, i believe 90. this application is 2006 application, 12 years in the making, it's time to move the project forward. this is a project if it gets

approved, it will get built, it will not be a shelved project due to the escalating construction costs. it will be a benefit to the neighborhood. eyes on the street. and dramatically change the pedestrian experience from a blighted lot. there is no exception or extraordinary circumstances. i would ask the commission to deny dr and approve the project as proposed. thank you for your time. >> president hillis: thank you very much. next speaker, please. >> san francisco housing coalition. i have a couple of quick comments to make. once again, i want to be clear when we're talking about numbers, we're not at 220% of anything. we're at 60% of hitting our market rate arena numbers. we're not at 220%, that number is thrown out there incorrectly.

it's important we have a fact based conversation. that's one. the other thing i wanted to make a comment about for some projects, it makes sense, on site drs, other projects when they fee out, that's how we get money to pay for 100% affordable housing projects. i feel there is often this it has to be one way or the other. both have advantages and disadvantages. but i don't think that we should say just because someone has feed out that is a bad thing, because as we want in the neighborhood, we want the ability to purchase 100% affordable housing sites and that comes through in-lieu fees. i just wanted to make those two comments about the conversation. >> president hillis: thank you. next speaker, please. >> hi. stephen bus with mission, first i want to say i'm actually neutral on the dr, but there

isn't a neutral line, so i figure coming last is ok. first, i want to say there is some troubling rhetoric from the people opposing the dr. and mission is very much against this rhetoric of exclusion and some of this very anti-poor stuff that people were saying. but i want to talk about something that rick hall said, he said why the mission? or rather he asked, why the mission? if i could have a projector, please. unfortunately, this is why the mission. in these red areas, in the san francisco zoning code, it is illegal to build apartment buildings. so rightfully, the mission is upset that all the development gets pushed into their neighborhood. we have to ask why? it's because of the rules that

we've put in place and that you unfortunately are tasked with enforcing. so, the project is right there. that's hard to see. in the "x". that dark green area is zoned for a building of this size. i also highlighted in the box there, the bart station. because a lot of people say, oh, well, it's near the bart station, we should put high density developments there and i agree in principle, however, what about glen park? the glen park bart station is surrounded by exclusionary single-family zoning that disallows apartments. why the mission? because we've made it illegal to build in wealthier exclusive communities. and that is an outrage.

ok. so there are other places to put a building like this, right? there is soma. but just last week, you continued a building of almost exactly this size because the rich neighbors were unhappy about their courtyard. so if you're not going to approve buildings there, where are you going to approve buildings? [bell ringing] what about the sunset? completely exclusionary to low-income communities. you cannot build apartments there. they've been illegal since the 70s. so like i said, i'm neutral on this dr. you're making us fight over scraps when we should be up-zoning the entire city. >> president hillis: thank you, any additional comment in support of the project? seeing none, dr request, you have a two-minute rebuttal.

>> commissioners, no one is suggesting that this lot not be developed. and frankly, this is just a diversion tactic and it was used to get signatures and i would welcome you to look at the zip codes of the signatures that were submitted. 8.5 by 7 foot windows are not context wall with the mission street corridor. and these volumes of glass are signals of affluence. and it maybe wouldn't be so bad if people in this neighborhood hadn't suffered so much. and, yes, we are in a bmr in that building and we have lost so many of our neighbors. and they can't come visit us. they're so traumatized. we can't even have them over to our home. it's a really uncomfortable place to be, but we need to save

more families. we need this developer to -- we know you can't make him do this. but we need him to voluntarily include some more affordable housing. and we have nonprofits and businesses that are an month to month leases and we need to secure them a space. they need to stay. they are serving our community. right now our community relies heavily on these businesses and nonprofits. we've had conversations, we've asked that the pro forma be shared with us, and we would like to continue the conversations. we would like changes to the design. and we'd like to move forward. we there is an agreement to be had here. >> president hillis: thank you. project sponsor. you have two minutes.

>> just to address the design and the window issue, as you can see in the upper drawing, this block of mission street is predominantly industrial, former industry, there is no pattern of residential buildings on the block. with the planning department, this is the design that is most appropriate with the windows that match the volume of windows in the adjacent buildings. these are shallow bays, but there is minimum amount of glass in a shallow bay to meet the planning code. i would urge you to consider the planning code requirements in the particular context of this block and looking at the dimension of the windows. we think and the team think this is an appropriate design for this block of mission street. the store front on mission street also is not particularly glossy. it has bulkheads, window panes,

sign band, transit windows. it's required to be 14 feet minimum floor to floor. we believe the store front design is appropriate. i would once again reference the housing accountability act. this is a code compliant project. it's seeking no exceptions from this commission. it needs no conditional use or lpa. this is exactly the type of project that the housing accountability act is meant to apply to, to -- [bell ringing] -- to impose the state's interest in housing production and allow you to move forward projects despite opposition that may be expressed, that makes it difficult to make decisions, but you do have the state telling you, you don't have a lot of discretion to make a decision. to disapprove a project like this that is code compliant. unless you have evidence of adverse impact on public health

and safety. [bell ringing] >> president hillis: thank you, that closes this portion of the hearing. commissioners? can i ask you question, mr. vettel? you indicated before there were negotiations ongoing, you put an offer. you can talk about what that was. were you offering things that are different than what is in the package today? >> there has been some discussion as to whether some of the commercial space could be offered at a reduced rent. we haven't been able to reach an agreement on that. the building would like to retain some of that commercial space for a small building amenity, for example, that hasn't been agreed to. the length of the lease term hasn't been agreed to. so those -- >> president hillis: the discussion about underwriting, the rate -- there was discussion about underwriting the commercial rent?

>> yes. >> president hillis: ok, thank you. >> and we can continue those conversations, but they have not reached a conclusion. >> president hillis: all right, thanks. i mean, we've been here before on projects like these. i'd like to put in context you know, the current affordable -- inclusionary rate in the mission is 25% and we all talked about that at length with the board of supervisors, they set that after voter approval. they also set the grandfather rules, i agree with members of the community, the rates seem low at 10.8%. but there is not much in our hands. it's been adjudicated and adopted by the board of supervisors and there is nothing we can do to compel the developer to do more, especially since they've held onto the property for some time. it would be good to see more inclusionary here. but that's something that is clearly not in our power to ask

for or require. as far as the design, i mean -- i'm supportive of housing on this site. i think it's a great site for housing. we're not demoing anything, it's as of -- we'd like to see more inclusionary. i think the design is good. it doesn't have a ton of glass. i know the project folks are referring to before, this is totally different. this is a pretty modest looking project that is fine and would work well. we have the project a block from here, that is a bit more modern, but i don't think this is anything like that. so i like the project. i think it will work. again, i wish there was more inclusionary. i don't think there is. interestingly, i don't know if folks follow the news in seattle recently, there was a tax put on to pay for more housing and homeless services, it was a city-wide employer tax. i think it's a wrong way to go, taxing employees.

i think a land-based parcel tax would be better, but i wish to devote more time and energy on broad based taxes and not waste time on drs like this to get one or two more inclusionary units. we would pass a tax for 100% affordable units. the city's housing, now erefuse dedicated for affordable housing has gone down. as redevelopment taken away in the power of tax increment. i wish we could take a step back and work with all those in the room that helped pass inclusionary rates in past dedicated sources for affordable housing. i think that's ultimately going to help solve the housing crisis, not modifying the design of the project that is code compliant. commissioner melgar.

>> commissioner melgar: thank you, commissioner. yeah, i too believe in taxes. [laughter] i wonder if i could ask mr. papadopoulos, the same questions that you asked mr. vettel in terms of the negotiations that happened with the developer. >> yeah. i was involved at some of these meetings, in fact, earlier on, i would say out of the united save the mission, i was leading the earlier efforts. they were covering some of these same kind of ground that mr. vettel mentioned at a certain point, we reached an impasse a little while ago, where it wasn't moving forward and at that point they said, why don't we take over and try another wave. negotiations are resumed and we're looking at issues of what can be done on the ground floor? it could be a stabilization space on the ground floor.

what can be done if terms of design? we think -- note again in the picture, the building next door, that's their building also. and let's also note that just because on area used to be a working class, this is our contention, that used to be working class jobs there, turning them into lofty style looking space its and imitating that upscale lofty look is not the same thing as when a place has bigger manufacturing glass, because it's actually a block that is heavy in manufacturing. >> commissioner melgar: that what you specifically asked for in the negotiations? >> specifically, to my understanding, the negotiation team has been asking for a modification of the design and especially again on the ground floor when you have the taller panes of glass. we understand there are height limits, but a number of projects coming to you on mission street, they're doing things to offset the lower portion.

in other words, they're making it human scale below and then up above is a set of awnings and something different. you have recommended that to my memory on a couple. and then there is the affordability issue, which i understand where we are with that, but that has been discussed. we explored section 8 along with using management company that works principally with veterans and people with disabilities. that's been explored and is still in discussion as well, that potential outcome for affordability. >> commissioner melgar: i didn't get clarity from you as to where the negotiations are. do you think additional time would -- >> i do. we were speaking up to the moment, we came back in the doors for the hearing. >> commissioner melgar: are there areas you have agreed? >> i think that -- any final

agreement would have to go back to a community vote. i also am not aware. i wasn't in the final moments of discuss, so i couldn't answer that if they thought they had reached agreement on any of them. >> commissioner melgar: that would be the dr requester? >> right.

>> he was going to discuss that with his investors. so we're really kind of in the

middle of the negotiations right now. but i would say that we feel confident that there is an agreement to be reached. our channels of communication with very open. so that's really where we're at. >> thank you. >> thanks. commissioner moore. >> the project is an interesting project, aside from the fact that it's in the mission. i think it's good in its massing. it becomes complicated when you put it into the mission and when you put it further into the context of seeing all of the projects cumulatively, which are participating in basically structuring of the mission which we have heard now for a long, long, long time. that's when it gets very heart wrenching and difficult to talk about what is appropriate. skipping forward, i can accept the fact that the inclusionary rate at when this project originally came forward was 12%.

with today's experience, it seems to be almost impossible to support a project which only does 12%. what gets more difficult for me is when i look at the mathematics of 12% over 37 units, that becomes a fraction. the fractional is 4.4% -- 4.44 units, which is 10.7%. so i just want to be clear. if there would be any kind of empathy, and i'm speaking really from a wishful position, if i would be the developer, i would kick that up to 5 units without any questions asked. that would be kind of the minimum baseline for accepting that the fractional in the situation that we're in, given the low rate, is so rate that instead of doing a 10.7, i would say i'm going to do 12 plus, whatever it is, in order to do something. i'm glad to hear that there may

be some movement on discussing a partial shared use with the community. i think that's a step in the right direction. i believe that the expression of the building on the commercial side is conducive enough to to do that without creating inefficiencies. what instruct me as unusual was the fact that the dr requester talked about the proportionality of the joining buildings are not properly represented. we were given a sheet which illustrated that. i'm not sure if the architect is here who designed the building that we're supposed to approve today, but i have to believe that the sketch that was given to us is a better building expression from my perspective than what is proposed in the packet of what's in front of us. it's just a better looking

building. it's smaller scale. it basically starts to reduce the height because it creates a more horizontal building rather than a vertical building. it makes a more squatty window, which looks like a better ratio of open and closed. i do not have any proof that the buildings of the adjoining building are misrepresentative. i would prefer a building expression as it is shown in this drawing, although we're not anarch tech tour al review -- architectural review committee. the package in front of us -- i want to say something positive. i said the building mathing is good. the courtyard is an okay idea. what i was missing is a question, there is no description of materials, and there is not really the normal kind of disclosure of what the building really will look like because it has no material

pallet, at least anywhere in the drawings that i have. i think that's a little bit of a question mark. there are some questions i have about unit design, but i'll hold back on that because i think our current discussions are really more about what compromises could be made, what additional discussions could be supported, and would it really warrant the idea to give them more time. >> commissioner richards. >> okay. where do we start here? members of the community said we sit up here and cater to the developers and take their side a lot in our decisions. we sit up here and actually administer the rule of law. we look at what's before us. we decide whether it meets the standards and we appreciate you telling us about the housing accountability act. we have a city attorney here that's kind of got a buzzer she

pushes every time we venture out in there. it never hurts to get that i if. so looking at the rule of law here which we took an oath to swear to administer up here sitting here, as i look at the dre requester's issues, number one, existing neighborhood retail uses be preserved and enhanced and future opportunities for employment in an opener ship interest. so i look at this and i look and i think, you know, the project sponsor has made some offers, which you may not have reached a decision, but it looks like there are offers on subdividing the space. i think even though it's not very big is a good idea because you get neighborhood serving businesses if they can afford a 400 square foot space or 500 square foot space rather than a 1400 square foot space. i would take that offer because i think that's conducive to your

item number one on your issues. number two, existing housing and neighborhood character be preserved and pro executive ited in order to preserve the cultural and economic diversity of neighborhoods. i come from a working class neighborhood. actually, a steel manufacturing town in pennsylvania. i think this building fits in homestead, pennsylvania. it looks very working class. it's not like we had down at, i believe it was, 1900 mission or we had floor to ceiling windows and it looks like people were on stage, all the curtains one build down because people don't want to be walking around in their underwear and have people see it. i think this is a handsome working class looking building. to commissioner moore's point on the pallet, i did look to try to find what the building would be consisting of, the materials, and on a108, i did see it's going to be hardy siding

prepainted, which is a handsome material. horizontal lap siding, cornice material with brick with panels being white. there's a couple of things here. i'm aware of hardy siding. i've used it before. i think that adds to the kind of working class look of the building. a few other comments, they are taking the on site option on affordability. it says right here in the report. unless i'm reading this incorrectly, they're putting the units on site. so this issue about pushing people out of the building that are undesirable is not the case. the affordability rate, we have a rounding issue, 12.45 can go five units or four units. it is blow .5. i would love to see an additional another. we can't force the project

response tore do that. on december 9th, if grandfathering goes away, if building permits aren't pulled yet, so in a few months, hopefully six months or less, we won't be talking about grandfathering anymore. everything will change to the new numbers. so put that on your calendar. i think -- could this building fit in soma with industrial buildings next door? yes, it kind of fits. i think for -- i would like to take dr and talk about the retail space being split and making sure that it is conducive to local neighborhood serving businesses. this is a hard block, i think, for retail because there's not a lot of retail on this block on pretty much either side. the nonprofit offer, i would also take as well, if you folks

would like to take more time and go out into the hall and we hear another couple items and you come to an agreement and come in and tell us what your agreement is, i would be open to that. i would like to get this thing moving out of the door today. one other thing, commissioner hillis, in pennsylvania where i come from, we have a head tax. wherever we work, we have to pay tax because we use the services of the city or municipality where we work. i don't not if our constitution in the state of california prevents that or not, but i think it's something we should look at. >> anybody else on this one? do we have a -- go ahead. go ahead. >> yeah. i will just add that i'm curious for the dr requester how much time would you want to just kind of spend more time working out an agreement? would this idea of going out into the hall to take some time

or -- >> i think we would need more time than that. part of it is that we're part of an organization and that we have to present it to the organization as well. you know, we're definitely having some good conversations, but i don't know that this is the decision that we can make immediately. so i think we would need a little bit more time, even a week or two weeks would be sufficient. >> i would be supportive of moving this project. i get the issues. i think you can continue to discuss it. there's certainly forms you can appeal our decision, too. that's happened in the past. if we spend every project talking about the design of retail space, we would never -- window wouldn't -- i get it. it's not a issue. i think the affordable housing issue is bigger than that. it seems like unfortunately those aren't even on the table. so i encourage the developer to look at issues like affordable

housing and the issue commissioner moore brought up about kind of rounding this up to the next unit as well as some of the design issues. i think the design, i actually like -- we can't -- all we can do is give more time. we can't enforce any kind of commercial rent control issue. >> we understand. we understand that you can't enforce or change any kind of affordability as well. we just wanted to bring that to your attention. but the things that we have asked for really have to do with the use of the commercial space and just, you know, these things. we're pretty close in our negotiations. >> all right. thank you. >> one more quick thing. there has been talked about a small increase in the equation. you did get some support e-mails on our behalf from two different ellis act eviction one that lives in our building. one or two units changes people's lives. >> i want to be clear.

this was adjudicated. the board of supervisors sets the rate at 25%. we look forward to the day that the projects come in at 25%. we haven't seen any yet. but i look forward to that. >> i'm not asking today. it's meaningful for us to continue this discussion and we're making progress. >> i encourage to you do it. >> why don't we have they go out in the hall for an hour, come up with something t so this we dont have to make a decision. are you open to that? >> they're not in a position to make a decision. they feel they have to go back to the coalition for a vote. they have other opportunities for appeal here. so given the december 7th deadline we're under to get a building permit out, to delay this hearing further and then for -- with a good chance of no settlement and then an appeal to

the board of supervisors. there's plenty day of opportunity to negotiate. >> board of appeals. >> yeah. there's opportunity to do that during those 30 days. to avoid an appeal to the board of supervisors, i don't think it would be fair or fruitful to continue this matter for a few hours today or for a few weeks or several weeks. i would rather move it out of the commission and we'll continue the negotiations. >> commissioner moore. >> what does it cost to file an appeal? >> 55. >> there's two ways to appeal. right? there's a ceqa appeal and then there's a board of appeals. correct? or no. can this go to the board of appeals. either one it can go. i don't know the cost. do you know the cost? >> $550 to appeal to the board of supervisors. >> okay. >> and i think less than that to the board of appeals. >> i have to be honest.

we'r we live in a community whih doesn't have $500 here and $500 there. if nothing else, i would support the idea that they spend at least another 30 minutes talking to each other on some talking points of what's a commonality and issues maybe. because if we do not take responsibility to encourage that talk, then i think we may find ourselves ultimately in no ability to see the support that we are trying to give negotiations about issues. we cannot enforce them. we can ask them to come at that timement i want to give them an opportunity to have a meeting of minds on points which we briefly discussed here. i know they are representing neighborhood organizations which have to agree, but i would like to leave an approval with the feeling that the best foot has been put forward. >> arare you willing to spend 30

minutes in the hallway talking about broad parameters? i don't think we're looking to look at commercial lease rates, but a commitment to discounted rent or something like that? we'll come back to this item. we'll just -- we can table this and just come back to it when they're ready? >> sure can. >> let's move to the next item. >> very good, that will place us end your regular calendar. item 3 was pulled off consent and it will be considered now. this is a conditional use authorization. >> good afternoon president hillis and members of the planning commission. i'm quite under the weather and i have no voice. i apologize. i'll keep my comments brief. this is to allow a surface parking lot to continue operating for two additional

years to may 17th of 2019. there is a current entitlement for residential tower containing dwelling units. it's clearly the highest and best use for that project. they run until november of 2019. so we are very, very hopeful this entitlement goes forward and we have a residential tower project built on this property. department is recommending approval and i'm available for any questions you might have. >> makes you sound cooler, your voice. project sponsor. >> we'll give you 3 minutes here. >> i'm the project sponsor. i'm getting that kind of voice with age, too. [ laughter ] >> cooler also. >> this is a drawing. there's no changes being proposed from what you approved several years ago. this will be the third time we've asked for this.

the conditional use permit will not hold up the large scale project that mr. foster just mentioned because the lease that my client has says explicitly that the project sponsor has the right to give, i think, 30 or 60 days notice to my client to leave the premises. the building permit for the large project has not been issued. you authorized in november of last year or rather in november of 2016, you authorized the developer the big project, to have until november of 2019 to pull that building permit. there was landscaping done, which you can see here, here, and here at the request of the commission. the last time we requested and you gave us a conditional use authorization and there have been other improvements made on the lot as well. i think you have some pictures

of what they are. there are 33 spaces here independently accessed, and there's 60 by valet parking. the recently opened or soon to be opened park at the large new office building has caused a closure of the street en chance. so the only way in and out now is on howard street. i do note that there's no parking building connection with the new park there will be people who can't use muni to get to that new park. we expect that as the new park opens in june, there will be people who want to use this lot in connection with using the park when business people are not using the parking during the day, monday through friday. i have nothing else to say, but

i'm available for your questions. >> welcome. public testimony. i almost forgot you. >> i always had a raspy voice. that's not cool. it's actually wispy, which is not raspy. raspy or wispy voices. you're listening to kgo94.5 on your fm dial. now that cannabis is legalized, i do a lot of it before the meeting. it's actually reading it.

all right. ms. hester. >> sue hester, this is a site that was approved for housing. it was approved by the commission over two years ago. this is what's in your packet. they're talking about they haven't received a building permit. that's from mr. gladstone. there is a discussion of housing in your packet. it's t. basically punts on the issue of housing. this is the san francisco housing inventory report, which i will pass up and put into the record. what it shows, this is 2016. what it shows is 525 howard street was approved for 334

dwelling units on site, one bedroom and two bedroom units. i think there's supposed to be about 50 affordable housing units there, approved 1-20-16. we have -- and here is the permits for the site. this is the most recent activity, building permits. it shows a permit that was suspended and reinstated for an office development in 2007 that was started in 2016. it's the most recent permit on file for the site. there's also the erection of an office building which was approved by the commission in 2000. so this building has been before

the commission twice. we have an urgent need for housing. where is the housing application for the building permit? what are you going to tell the developer about going forward with the construction of the housing? we have -- you spent the past three hours talking about housing needs, and you have an approved project that you did that is this parking lot site. parking lot is taking precedence right now over processing the construction of housing. so i was hoping that you all would ask bluntly how they're moving to get the housing constructed. you approved it 2 and a half years ago. where is the building permit

activity for the housing? i expected all the housing people to be echoing my request. so what are you doing? what information do you have? jonas, i want to put this into the record. >> any additional public comment on this item? seeing none, we'll close it. commissioner -- >> thank you for that. you may be surprised to learn that i somewhat agree with ms. hester on this point. >> good. >> i think that -- and this point was raised to me before the hearing on the dates. so i think -- i think we are concerned about sort of creating an impetus to move forward with the housing project.

my suggestion to you would be to change the date to make the date of the extension of the parking lot coterminus with the date of the entitlement expiration, which i think is november of next year. >> november 3rd of 2019. >> november 3rd of 2019. >> so you would recommend to make that the expiration date? >> yes, for the parking lot extension to no later than november 3rd of 2019. >> all right. >> may i reply on that? just to be clear, i think ms. hester was looking at me. i don't represent the property owner and i don't know anything about the building that's proposed. i will say that since the lease has a 30 to 60 day termination clause, the owner could terminate is next month. he can terminate it -- >> i think we're trying to get the outside date so we get activity on the housing there. >> i don't think the fact that you let our lease to be reduced

to that date through a continual use that's shorter than two years will lead this housing project to go forward. we're not in the way of it. >> i understand. if they're getting revenue from the parking, that may help them kind of continue on and not build the housing. i hear you. thank you. commissioner richards. >> was this project subject to grandfathering on december 8th or 9th? would it flip up on the affordability -- >> it's in the transbay district. so it's 35%. >> remind me -- >> actually has a minimum of 15% affordable under the transbay. >> transbay has 15% on site requirement. >> that's correct. >> that's what this did. >> okay. this was one of those mystery ones to me. we entitled it, go the it, seems like forever and a day ago and what's going on with this as ms. hester points out. >> it was only a year and a half ago or two years ago. >> it was november of 2016.

i'm the project planner for that project. >> i drove by there the other day and honestly, it's a sound factory, isn't it? >> it's 540 howard. >> okay. it's right up against the terminal. yeah. >> all right. so we're going to entertain a motion? >> move to approve to extend the lease no later than november of 2019. >> second. >> thank you commissioners. there is a motion that has been seconded to approve this matter with conditions as having amended to reduce the extension date to november 2019 on that motion. commissioner johnson.

[ roll call ] >> so moved. commissioners, that motion passes unanimously. >> let's go back. it appears like the project sponsor for 1863 are back. the white smoke is rising from the vatican. [ stand by ] worked that the --

the intent of the agreement -- that has been worked out in the hallway between the project sponsor and the d.r. requester, the fourth floor hallway summit. commissioner johnson? >> commissioner johnson: i just want to thank you all. i want

[applause] >> clerk: very good, commissioners, and there's a motion that's been seconded to take d.r. and recognize the private agreement between parties and approve the project as proposed. on that motion --

>> not as proposed. >> president hillis: take d.r. and approve the project, but recognize the -- >> clerk: okay. not take d.r. and approve the project, but recognize the private clerk. on that motion -- [roll call] >> clerk: so moved, commissioners, that motion passes unanimously, 6-0. zoning administrator, what say you? >> cory teague, public hearing grant with the standard conditions. >> clerk: very good, commissioners. >> president hillis: all right. so we'll move to our regular calendar. >> clerk: very good, commissioners. that places us on item 10. [agenda item read] >> president hillis: jonas, we're going to take

>> clerk: good afternoon and welcome back to the san francisco planning commission regular hearing. excuse me, if i could have your attention. i'd like to welcome you back to the san francisco planning commission regular hearing for thursday, may 17, 2018, and i will remind members of the public to please silence your mobile devices that may sound off during these proceedings. commissioners, we left off on your regular calendar on item ten. [agenda item read] >> good afternoon, commissioners, diego sanchez with planning department staff. increase the transportation sustainability fee by $5 for nonresidential projects 100,000 square feet or larger. before i begin my presentation,

i'd like to provide sonny angulo from supervisor peskin's office to present to you. >> hi, commissioners, i know you guys have had a long day already so i will try to breeze through this, but i felt it was important to give you the supervisor's perspective because it has been to land use already. i think there is some important background in terms of his goals around trying to cobble together this package of revenue. so the last time that this body heard the transportation sustainability fee, the board of supervisors ultimately did pass and approve a $2 increase. in acknowledgement to the spike in both residential and commercial development needed a plan for corresponding infrastructure that could accommodate the city's population and job growth. unfortunately the mayor did veto that legislation, but

luckily the city knew it was a big priority and we have tried to continue that conversation to varying degrees of success. so to that end, supervisor peskin cochaired the task force 2045 last year. it was an exhaustive robust process. director rahaim was also involved in that planning, so thank you for participating in that process. a big part of that conversation was really trying to learn from the lessons of the successful prop j passage and the prop k failure which was basically that the voters of san francisco recognized that we had a very good, thoroughly vetted expenditure plan, but that, you know, it was very important to them where that money was going to be coming from to pay for this $100

million in local contributions that we would need to match or to contribute towards the overall $22 billion need, billion dollar need over the next 27 years. and just to give you an idea, a large -- there is a significant portion of that that is certainly generated by the construction that's happening in the downtown and central soma. a lot of it is maintaining the baseline, all the things that impact the out lying areas as well, and so we aren't in this situation every couple of years to makeup this deficit. so, you know, our -- since then, our office has been working really closely with the tax collector's office, the controller's office, the sf mta, the sf cta and supervisor peskin introduced a commercial tax receipts in december, which

was one of the top vote getters out of the top options that the task force put together. subsequently, a couple months later or a month later, his colleagues introduced competing grocery receipts measure, which we realized that that conversation -- important conversation was not going to be able to happen without causing a bit of a kerfluffle -- >> president hillis: sorry. can we just avoid other conversations back there? we can hear you guys. thank you. sorry, miss angulo. >> thank you. so here we are. we are going down the list of recommendations from the task force. we're really trying to identify how we're going to find this money both for infrastructure and transportations. and one of the recommendations was to look at this again, increase it to compensate for the impact that commercial

development is having citywide, not just in the downtown area and south of market areas. and so, you know, another -- another big part of that was also approaching this from an equity standpoint. who pays what i think is very important, and i think the voters told us that when they overwhelmingly shot down a sales tax, that was proposition k in 2016. and then, the other piece was really recognizing that the beautiful thing about a tsf, transportation sustainability fee it's really something that should be spread equally throughout the entire city. so our office met several times with planning. i want to thank diego and some of his entire team. we pulled in some of the original team members that had done the 2015 fiscal feasibility analysis. ultimately supervisor peskin felt strongly that a $5 fee was

not only feasible back then but it's feasible today, and it's necessary given the tremendous value that we recapture from the booming commercial office -- office space market. so that being said, planning staff did indicate that they had concerns around some of the margins, the financial margins for some of the large scale projects in the central soma plan, and so to that end, we did introduce amendments that the land use and transportation committee, that, you know, essentially acknowledged that if the central soma plan is approved, knock on wood, that there would be a 2 dl$2 increa which is frankly what it would have been prone to if it had passed. at the time of those tsf discussions, there was concern -- the original

transportation sustainability fee discussion, there was concern that the board would also be considering at this time supervisor yee's child care impact fee, and that would impact the economic feasibility of the construction projects. to address those concerns, supervisor avalos asked them to study the impact on those on the two large residential project prototypes. planning's only analysis found when the $2 tsf was combined with the child care impact fee the impact value is only a - 7% which is well below a - 10% for a project's feasibility. had this been taken into

consideration, and i think had this really been this transportation priority and the fact that the board had already set forth a policy say we believe a $2 increase is not only feasible, it's necessary -- i understand there are a lot of different competing needs, but the reality is we are three years into an expenditure plan that we don't have money for, and we don't know where that money is going to come from. i want to acknowledge and the supervisor acknowledges that this is only a drop in the bucket. i see commissioner richards nodding his head, but what we would generate is only a drop in the bucket, but this's really kind of the mandate that we gave the task force is hey, there's not this one silver bullet that's going to be able to solve all of these problems. we need to work together with city staff with our corporate shake holders with our business and office and developer stakeholders and really