the ayes carrie. madam clerk, call the next item, please. [agenda item read] >> this item is before you because we had only one bidder. we've had a similar contract before, and we had the same bidder. it is below the contractor's bid, but we want to do outreach. this is more of inspection and cleaning, and it's to assist the waste water enterprise. >> and you have no issues with this contract? >> no. >> does pipe and plant do all of our inspecting? >> they do a lot of our inspection, but our own waste water enterprise also does inspection, as well. >> move the item. >> it's been moved. >> second. >> and seconded. commissioners, any further discussion? hearing none, is there any public comment on the item?

public comment is now closed i'll call for a vote. all those in favor signify by saying aye. all those opposed? the ayes have it. madam clerk, the next item, please. [agenda item read] >> could you bring up the powerpoint, please. donna, may i give you these for the commissioners?

commissioners, i'm rosanna russell. i'm the head of real estate, and i am bringing to you a proposed framework for a real estate exchange of two properties. the first property is owned by the p.u.c. we own it at 639 bryant. it -- this property serves the power enterprise. it's a utility yard. the property's 1.37 acres. it has a warehouse and parking lot, and the p.u.c. operates a hydrogen peroxide tank for sewer odor control on the property. this will be significant later. the appraised value of the property is $63,875,000. the reason this is so expensive is the property will soon be in what's called the central soma

plan after the city approves that plan. that plan will upzone 639 bryant and all the surrounding properties, there by contributing to its appraised value. we seek to exchange this property for 2000 marin, but before i describe 2000 marin, i need to describe our leased property next door, which is 651 bryant. again, we lease this to the power enterprise. our lease expires in 2019, and we have one option to extend the lease for ten years. we pay $293,724 a year in rent, and the owner of 2000 marin has an option to purchase this property. so before we discuss the mechanics of the exchange, i wanted to explain that the

p.u.c. needs additional property space. 639 is small and will not meet our anticipated future utility yard needs, so we need to expand or secure a facility placement in the future. what is key is that frisk has a well documented very low vacancy rate for industrial space. it's less than 2%. it's very challenging and it's very expensive to locate a replacement valve facility for 639 bryant -- or an expanded replacement facility. the owner of 2000 marin came to us and proposed an exchange. an afillate owned 2000 marin. this is the property. you may know it as the former san francisco chronicle printing press. it's a very large property. it's 7.4 acres, and it has a 74,000 square foot building. this property is almost five

times as large as 639 bryant. its appraised value is 63,600,000, $275,000 less. the owner of 2000 marin seeks to exchange this property for 639 bryant because the owner wishes to develop the property that consists of 639 bryant, 651 bryant, and some other adjacent parcels. that's 2000 marin. what i need to bring to your attention is that 2000 marin's former uses caused soils contamination. there's a deed that subjects this property to the over sight of the california department of toxicic substances control. this means that any disturbance of the existing asphalt cap requires d.p.i.s consent and

could require modification. the developer has agreed to pay up to $100,000 for phase two testing which will reveal the extent of the contamination, and that $100,000 should also cover the p.u.c.s over sight cost. the p.u.c. will hire consultant to vet the needed testing and to cover any remediation costs. the estimated costs do not include remediation costs. we will come to you to ask you to review the testing, the environmental condition of 2000 marin, and you have a choice there. you either approve the environmental condition, you authorize us to negotiate an acceptable strategy for remediation, or you can elect to terminate the agreement. so again, this is why we're asking you to approve a conditional agreement because you have conditions to approve in the future. other key terms of the

agreement are the developer will pay our transactional costs, like appraisal costs, attorney fees, closing costs. the developer will pay to move the power enterprise to 2000 marin. the developer will move the hydrogen peroxide tank to our site. the developer will construct a temporary facility on 2000 marin for the power enterprise subject to our reimbursement. how will we reimburse the developer? the developer plans to lease a portion of 2000 marin for a short-term, maybe four years, to the flower mart. the flower mart is temporarily being displaced and needs a place to go during construction of its new facility.

that income stream or an alternative funding source will help the p.u.c. reimburse the developer for the cost of the replacement facilities. we're hoping it will cover it. because this is a -- again, an important decision point, we will ask the commission to approve any short-term lease or the alternative funding source. eventually, the short-term lease will be assigned to the p.u.c. when we close escrow, so the dollar magnitude is such that we need your approval. we cannot close escrow on the exchange, and we will not ask you to declare 639 bryant until several closing conditions occur. the developer needs to receive all of its approvals for its project on bryant and brannan. again, the developer must pay

the environmental testing cost, our oversight costs up to $100,000 and the p.u.c.'s transactional cost. again, you, the commissioners, we ask you to review the phase two testing, the costs, and either ask you to issue approval of the environmental condition of 2000 marin or you have the option to terminate or negotiate at that point. again, we will ask you to, as a closing condition to approve the short-term lease of 2000 marin or the funding source to fund the construction of the temporary facility. both the developer and the p.u.c. must approve the plans and budget for the new temporary facility, built to our specs, and the plans for the tank relocation. the board of supervisors must waive or reduce certain fees for the development exchange for the dedication of a public park to the city as part of the development project. finally, the board of

supervisors and the mayor's must authorize the closing. i realize this is a lot of information. i'm open for questions, and we also have others in the audience who can respond to very specific questions about the central soma plan. >> thank you. if i may. want to go? >> i'm familiar with the area, and maybe you can answer this. if we're successful at navigating these transactions, do we foresee that -- 'cause we got a lot of stuff out there. are we thinking that we're going to position staff into a more modernized work environment? 'cause that's what interests me. i've been to their -- we represent a lot of people. i've been there. is that -- is that what we're doing here? >> yes. well, it's a two-stage process. because remember, we also have to comply with ceqa. >> right. >> so we will move the power enterprise from bryant street to a temporary facility with temporary buildings, and more importantly, a yard that can

accommodate our equipment, our poles, our trucks, our whatever they call those tall things that move the poles. i'm not a technical person, i'm sorry. and then, during the term of the short-term lease, we anticipate that the p.u.c. as a whole will look at 2000 marin, the entirety of 2000 marin and program it for permanent facilities. remember that requires compliance with ceqa, development of a program, obtaining capital funding, and also dtsc oversight, so it will take several years. so as staff, we recommend the short-term lease so the p.u.c. has an income stream to fund the temporary facilities and give it the time it needs to plan for long-term -- for permanent facilities. >> thank you for answering my

questions. commissioner viator. >> so i have a couple of questions. the $100,000, what happens if it goes over that and additional testing is needed? >> i don't expect it to go over that. the p.u.c. gets reports -- well, let me back up. i'm not a technical person. during real estate collaboration, we collaborated with water resources who routinely hires experts for the p.u.c. and reviews reports. he's confident that this amount is generous to cover our costs, and also the cost of a second consultant, remember, to vet the phase two report. we're not just accepting it at face value, we're seeking outside confirmation. >> and then, is there a certain point -- a certain price that would then make the project not worth moving forward if a certain amount of remediation

is need index. >> -- needed? >> i think we need facts. i think we need to know what the extent of the remediation is in relation to our use. remember, we're an organization that is planning -- typically uses just the surface for our heavy equipment, our pipes, our materials storage, so the extent of the remediation really depends upon what our plan is. so we can estimate is as to -- under various scenarios, but until we have that phase two report and know exactly where the remediation is requires, and -- required, and the amount, then we will come to you, and the commission will make that decision as to whether -- you know, what is -- what will happen next. >> yeah. i just -- you know, through the chair, i'm going to be watching this pretty closely.

i think we're all tracking what's happened at the shipyard, with the sampling of the soil and what a mess that's become, so i would urge you to watch this process carefully, and i look forward to seeing the results. >> we will. one thing i want to remind all of the commissioners is that industrial space in san francisco is by nature has soils contamination. so we will watch this carefully, but we can't go anywhere without encountering this issue because we've looked -- prior to bringing this to the commission, we looked at several appraisals, we looked at other properties, we really drilled down. so -- and again, we will -- i won't look at this, our geoologists will look at this. >> that's the very nature of my concern is we do not want to put our workers at any risk, health risk, so i think it's going to be very important for us to make sure it's remediated at a level that maintains and

ensures workers' safety. >> and again, this will be a decision point for the commission. >> commissioner marin. >> thank you. the appraiser's report, as i read it, makes it clear that their appraisal does not factor in any cost of remediation. am i correct on that? >> that is correct, but my understanding of the uniform standards of appraisers is that they do not estimate the impact of remediation on value unless a third party who is expert in that area presents information to the appraiser. >> right. >> and i did not just rely upon our appraiser's representation. we had a written memo to that effect. i went and looked at every appraiser -- appraisal that the city has gotten in the past two years for industrial land because we are -- the real estate folks at the port were very generous. they gave us the reports -- the appraisals for pier 70, and we

looked at other appraisals. >> but we are -- excuse me. but we are also going to be getting through this agreement, as i understand it, an additional third-party assessment of that site. >> yes. >> and at the conclusion of that, we should have the basis for making a pretty decent estimate as to what the remediation cost would be. >> we understand your instructions and commissioner viator's instructions. >> okay. so when it comes back to us, the way you laid it out, it sounds as though this commission will have an opportunity to make sure that the price that we ultimately agreed to is still a viable project in light of whatever the remediation costs are. >> i agree. >> so that if -- if they were

significant, but, on the other hand, the developer paid them, then, it stays the same. if there are some uncompensated portion, then we have to take a look at that and say is this still a viable project and does it meet the charter requirements for making sure that we both buy and sell property at fair market value. >> understood. >> that will -- information of that decision point comes back to us about when? >> i actually don't have an estimate. i imagine it will be in the next several months. because we have not done the testing, we have -- yet, we expect the developer will do so expeditiously, but again, we need to hire our own consultant -- two consultants. one to vet the phase two report, and the second to estimate the cost of remediation. so we hope to come back to you in 2018, but i would not be surprised if it's early 2019.

>> okay. and the other big contingency that's out there is that we can't declare bryant street surplus until we have a place to move those functions. >> absolutely. that's the remainder of my presentation. we will -- until the closing conditions are met that i just mentioned, the proposed escrow closes, and the p.u.c. acquires 2000 marin, 639 bryant will not be deemed surplus because we still need it for utility use. >> and what's the timeline on that set of conditions being met? is that similar to the environmental timeline or is that -- >> yes. >> so both parts of this, and really, the ultimate decision on going forward on this

exchange should come to the commission sometime late this year or early next year. >> yes. >> and that's when all of our sharp eyes will have something to look at and consider. >> correct. may i also give the commissioners one piece of information i forgot to give you? >> please. >> if this transaction does go through, the p.u.c. will save almost $7 million in rent from 651 bryant over the course of the next 11 years. and again, the reason is the central soma plan has caused an escalation in real estate values. so the same appraiser that appraised the fair market value of both lands helped us do an informal appraisal of 651 bryant. so if you as commissioners decide you want this transaction to go forward, there will be some savings that you should consider. >> in addition to savings, do we have any assurances from the developer in regards to open

housing commitments, prevailing wage construction, union construction. >> well, the developer is here. this is not part of our inquiry because we're p.u.c., but may i introduce henry sears to come to the podium to answer those questions? >> before you do that. i just wanted to make sure that you kind of understand how this deal happened. so you know, we were, you know, at 639 bryant, minding our own business, and, you know, operating the yard, although it was cramped. but we were approached with this deal, 2000 marin, and we looked at the space, and we thought wow, that would be nice because not only the power enterprise needed extra space, but the c.d.d. needed extra space. so we started talking about wow, this could be a great

opportunity. but we were operating at-is, we didn't know if it was going to come to fruition. it was a proposition m, we didn't know if it would get the necessary office space allocations. but now, i think the motivation is with the developer so we're pretty much waiting on them and of course, you know, that we want to save our rate payers as much as possible so we're going to look for the best deal possible. so i do appreciate making sure we have safeguards as part of the mitigation that needs to happen on-site. and so -- but with that, if you have a question -- >> well, maybe we won't get into it. maybe we'll have what we need. the reason i inquired is because i think it's there. there's more to the story. maybe it's a little early to talk about affordable housing,

prevailing wage, and union contracts. that'll eventually be a part of it for the benefit of the city. >> there's a huge back story, but there are people here that are far more competent to discuss it. >> okay. so if he wants to get up -- >> henry, do you want to come up? >> okay. >> okay. sorry about that. >> i kind of gave you the motivation behind them wanting our space. >> henry sears. i oversee our development at 5 # 0 bran -- 590 brannan street. this is a project that we've been working on since 2012, and we first approached the p.u.c. in 2014 when we first saw the opportunity to buy 2000 marin and do the swap. the overall project that we're planning is a total of 4.5

acres. it'll include three office buildings totaling 922,000 square feet of office, a 13,000 square foot affordable housing site, plus we'll take 639 bryant, and we'll combine it with two other private parcels to create a new 40,000 acre public park, which will be a public benefit as part of the project, as well. and tishman-aspire properties, we own a number of properties in san francisco san francisco. all of our construction sites are also union, and i think an important thing, part of this transaction that we worked out in the last couple month is that as a condition of closing, we will turn key the temporary utility yard at 2000 marin, so when this transaction, we hope, eventually closes, before it happened, all the work -- before it happens, all the workers will be moved to an

approved facility at 2000 marin. >> sorry. what percentage of the housing's affordable? >> all -- so at this specific site, there are going to be 72 units. they're all 100% affordable. we have three different sites within the central soma plan, so we're looking to build a total of 1200 units of housing. 30% of that would be affordable. >> sorry about that. thanks for -- >> thank you. >> do you have any other questions? >> i have some questions. >> commissioner caen? >> actually, my colleagues asked many of my questions, but the lease at 651 bryant is over in october? >> october of 2019, and then, we have an option to renew for ten years. >> okay. so how does that option work? because obviously, this process is going to take a much longer time than i think we're talking

about. >> we definitely intend to exercise the option. >> okay. so -- so can we -- what happens if we only need it for -- >> there's a mechanism in the exchange agreement that is before you where we can get out of the lease without additional payments, correct, richard? >> that's correct. >> okay. so getting back to the developer, tishman, it sounds like what is in this is that all of your approvals have to be met before this can happen, is that correct? so that's going to be a long process. are you -- can you give any indication about where you are in that timeline? >> yeah. so the central soma plan itself is -- the city's good night working on that for eight -- been working on that for eight years now. i think the first board of

supervisors meeting was yesterday. i think the current timeline is they're trying to have it approved in advance of the august recess? then after that central soma plan is approved, our project would go up for project specific approvals? we don't have exact timing on that but we've been working on all of our environmental work and entitlement work over the last two years to be ready to apply for it this year. >> good. well, you're -- you're ahead of it, sort of, from my point of view. good. that's good news because when i was reviewing it, i just felt this would be such a long process that we would never -- it would never happen. >> i agree. so we -- staff struggled in writing the staff report because there's so many external factors. we wanted to give the commissioners and commission ample information to get a decision, but we didn't want to bury you so that your eyes glazed over, and you thought

what is this, with a phone book of information. so i'm really glad that henry's here to provide further detail. >> has this been moved? >> not yet. [inaudible] >> i would like to move the item. >> it's been moved. >> second. >> and seconded. is there any further discussions, colleagues? hearing none, is there any public comment on the item? hearing no public comment, public comment is now closed. i'll now call for a vote. all those in favor, please signify by saying aye. all opposed? the ayes have it. madam clerk, call the next item, please. thank you for your report. [agenda item read] >> i do have a speaker card. mr. drickmeyer. >> peter dreckmeyer, tuolomne

river trust. i was pleased to here commissioner viator's questions regarding the water plan, and you mentioned you were going to cover the topic under closed session. i think it would be really beneficial for us to have a public meeting, as well. i think we've had some glitches after the substitute environmental document. the draft came out in september of 2016. there was the sfpuc bawsca editorial. we followed that, got off to a rocky start, and there was no discussion at the commission level for four months, not until january of 2017. and there really wasn't much input from the commission, which i think would be valuable this time around. the -- your staff put together a brief, and we had a -- kind of a scathing critique of it, and chair courtney then encouraged staff to meet with

us, which we appreciated. we started getting more information, and over the course of a year, i think we've put together a package that would work for both the economy and the environment, and we'd like to discuss that with you. the staff responded to our critique, and i thought it was a fairly weak response, but nothing really happened from that. so i do hope that we can get this scheduled. the comment deadline on the final s.e.d. is july 27, so if you were to have this discussion at your next meeting on the 24th, that would be in advance of that. the decision is expected on august 21 or 22, so it's a much shorter time frame than last time around. also, i note that item 20 on this agenda today is motion regarding whether to disclose the items discussed during closed session pursuant to san francisco administrative code. i hope you will consider sharing what the closed session item is. obviously, i'm very curious,

and i don't want to be unnecessarily concerned that something's happening that we would need to know about. so perhaps you'll be willing to share the outcome of that. thank you. >> is there anymore public comment? hearing none, public comment is now closed. is there a motion? >> i move to assert. >> second? >> second. >> it's been moved and seconded to assert the attorney-client privilege on matters listed below. madam secretary? >> clerk: item 18 is anticipated litigation as plaintiffs, and item 19 is existing litigation, restore hetch hetchy versus city and county of san francisco. >> and there's no public comment. >> okay.

we're returning from closed session. is there a motion regarding whether or not to disclose the conversation that took place during closed session? >> move not to disclose. >> it's been moved. >> second. >> and it's been seconded. any public comment? hearing none, public comment is closed. you'll call for the vote. all in favor signify by saying aye. all opposed? the ayes have it. there is no announcement following closed session. any new business, commissioners, colleagues. hearing none, mr. richey, is there anything to add? >> nothing to add. >> okay. welcome, mr. richey. so hearing none, this meeting's now adjourned.

>> neighborhoods in san francisco are as diverse and fascinating as the people who inhabit them. today we're in the sunset, where we'll join supervisor tang for the inspiration of this show, where we explore san francisco, one neighborhood at a time. hi i'm katy tang the district 4 supervisor in san francisco, which is comprise of sunset and parkside neighborhoods. i think what makes district 4 unique is that we have so many different cultures here. we have so many different generations of people. different experiences and that makes it a vibrant neighborhood. for example, which you go down urban street you can do to a japanese restaurant, chinese restaurant, american restaurant, and the

cultural diversity is just what makes it so amazing my name is ching le, and i'm the owner of the kingdom of bounty. 17th san francisco, 94116. we make the most authentic and different kinds of dumplings and dim sum. recently more and more popular because they are vegetables and meats that we use fresh vegetables and meats in the business. it's really inspired to start discover your district series, because i wanted to find a way for neighbors to come and get to know our small businesses and our neighborhoods. get to know each other, get know our office, and do so in a setting that was unintimidating and fun. so i launched this idea call the "discover your district," where we go every month to one or two small

businesss in district 4 and we have done things such as learning how to make dumplings that we're learning today and there are so many different activities that we have exposed our residents to. >> today is the very special day, because the city of san francisco hosting this for san francisco city. learning how to make dumplings and knowledge of dumplings. they love to do it and all enjoy it. >> this is definitely not my first time making it, so i have definitely improved a lot. the first couple of time s i tried to make dumplelings they looks inedible. they have definitely improved. there is a special dumpling eating contest, which is amazing. everyone those eat the dumplings that they made and see how many they can do. i'm curious as to how many

they going to be able to down today? >> don't forget to write down what you are eating today. >> we make all different kinds of dumplings and enjoy what they made. so after that, we'll have contact how many pieces of dumplings they can eat and announce the winner today. today we are going to talk about fire safety.

we are here at the urban center on mission street in san francisco. it's a wonderful display. a little house in the urban center exhibition center that shows what it's like in a home in san francisco after an earthquake. one of the major issues that we are going to face after earthquakes are fire hazard. we are happy to have the fire marshall join us today. >> thank you. my pleasure. >> we talk about the san francisco earthquake that was a fire that mostly devastated the city. how do we avoid that kind of problem. how can we reduce fire hazard? >> the construction was a lot different. we don't expect what we had then. we want to make

sure with the gas heaters that the gas is shut off. >> if you shut it off you are going to have no hot water or heat. be careful not to shut it off unless you smell gas. >> absolutely because once you do shut it off you should have the utility company come in and turn it back on. here is a mock up of a gas hear the on a house. where would we find the gas meter? >> it should be in your garage. everyone should be familiar with where the gas meter is. >> one of the tools is a wrench, a crescent wrench. >> yes. the crescent wrench is good and this is a perfect example of how to have it so you can loosen it up and use it

when you need it. >> okay. let's go inside to talk about fire safety. many of the issues here relate to fire, for example, we have a little smoke detector and i see you brought one here, a carbon monoxide smoke detector. >> this is a combination of smoke and carbon monoxide detector. they are required in single homes now and in apartment buildings. if gas appliance is not burning properly this will alert you before the fumes buildup and will affect you negatively. >> this is a battery powered? >> this is a battery powered and it has a 10 year battery

life. a lot of times you may have one or the other. if you put in just a carbon monoxide detector, it's important to have one of these too. every house should have a fire extinguisher, yes. >> one thing people expect to do when the power goes out after an earthquake about using candles. what would you recommend? >> if you have a battery operated candle would be better to use. this kind of a candle, you wouldn't want it in an area where it can cause a fire or aftershock that it doesn't rollover. you definitely want to have this in a non-combustible surface.

>> now, here we have our stove. after a significant earthquake we expect that we may have gas disrupted and so without gas in your home, how are you going to cook? >> well, i wouldn't recommend cooking inside of the house. you have to go outside and use a portable stove or something else. >> so it wouldn't be safe to use your fireplace to cook? >> not at first. you should check it by a professional first. >> outside should be a safe place to cook as long as you stay away from buildings and doors and windows. >> yes. that will be fine. >> here we have some

alternative cooking areas. >> you can barbecue and if you have a regular propane bark could barbecue. >> thank you for joining us. and thanks for this terrific space that you have in this exhibition space and thanks for helping san francisco stay safe. >> i lived in the mission neighborhood for seven years and before that the excel see your district. 20 years a resident of the city and county of san francisco. i am the executive director of a

local art space nonprofit that showcases work that relate to the latino community and i have been in this building for seven years and some of my neighbors have been here 30 year. we were notified from the landlord he was going to sell the building. when we realized it was happening it was no longer a thought for the landlord and i sort of had a moment of panic. i heard about the small sites program through my work with the mission economic agency and at met with folks from the mayor's housing program because they wanted to utilize the program. we are dealing with families with different needs and capacities. conversations were had early in the morning because that is the only time that all the tenants

were in the building and finally when we realized that meda did have the resources to buy the building we went on a letter writing campaign to the landlord and said to him we understand you want to sell your building, we understand what you are asking for and you are entitled to it, it's your land, but please work with us. what i love about ber nell height it represents the diversity that made me fall in love with san francisco. we have a lot of mom and pop shops and you can get all your resources within walking distance. my favorite air area of my homes my little small patio where i can start my morning and have my

coffee an is a sweet spot for me and i is. >> good afternoon. we will proceed with the health commission meeting, and the secretary will please call the roll. [roll call] >> clerk: the second item on the agenda is the approval of the minutes of june 19, 2018. >> so the minutes are before us for approval. a motion is in order. >> motion. >> is there a second? >> second. >> are there corrections to the