test test. >> secretary: [roll call] the san francisco port commission acknowledges that we are on the unceded ancestral homeland of the ramaytush ohlone who are the original inhabitants of the san

francisco peninsula. as the indigenous stewards of this land, and in accordance with their traditions, the ramaytush ohlone have never ceded, lost, nor forgotten their responsibilities at caretakers of this place, as well as for all peoples who reside in their traditional territory. as guests, we recognize that we benefit from the living and working on their traditional homeland. we wish to pay our respects by acknowledging the ancestors, elders, and relatives of the ramaytush ohlone community. that brings us to item two, approval of the minutes. >> president: commissioners, is there a motion to approve the minutes. >> commissioner: so moved. >> commissioner: second. >> president: okay. we have a motion and a second. >> secretary: [roll call]

i see commissioner gilman nodding yes. >> president: the minutes of february 8th, 2022, are adopted. >> secretary: next item is the pledge of allegiance. >> i pledge allegiance to the flag of the united states of america. to the republic for which it stands one nation, under god, indivisible, with liberty and justice for all. >> secretary: item number four is announcements. please be advised that a member of the public has up to three minutes to make pertinent public comment on each agenda item unless the port commission adopts a shorter on each item. the moderator will instruct participants to use the touch tone phone and an audio input or an audio prompt will tell

you when you are able to speak. please note, if you're watching this meeting on sfgov tv, there is a short broadcasting delay. so when the item you want to comment on is announced, dial 14156550001. and then enter access code 24980743029 pound. and then mute the volume on your television or computer. and then when public comment on the item is announced, dial star three to raise your hand and then listen for an audio

prompt. >> president: jenicka will provide instructions now. >> thank you, president adams. at this time, we will open the queue for anyone on the phone who would like to make comments on items not listed on the agenda. please dial star three in you wish to make public comment. the system will let you know if your line is open. others will wait on mute until their line is open. comments will be limited to three minutes per person. the queue is now open. please dial star three if you wish to make public comment. president adams, at this time, there are no members of the public on the phone wishing to make public comment. >> president: public comment is closed. carl, next item, please. >> secretary: item 6a is the executive director's report. >> good afternoon president

adams. vice president wooho, commissioner gilman. first i'm excited to announce that the waterfront plan is one step closer to completion. as you know, the plan sets land use and values frame work and you will recall is the result of three years of community engagement. i'm very happy to report that the plan is in its final stages and is moving forward with the draft e.i.r., environmental impact report. in e.i.r. is a major milestone in the public process. the document analyzes the environmental effect of the updated goals and policies in the plan. the port is working with the san francisco planning department who will publish the waterfront draft e.i.r. on wednesday, tomorrow, february 23rd, 2022. i invite the public to review and provide comments on the

draft e.i.r. from february 23rd through april 25th at the planning commission public hearing held on march 24th. the public comment may also be submitted at the planning commission hearing or in writing to the planning department any time during the public comment period up to april 25th. the draft e.i.r. as well as the public engagement and comment opportunity is available online on the port and planning department websites. port commission approval of the water front plan will be final once the e.i.r. is complete. i want to thank you, commissioners for your leadership in our waterfront planning process. i want to thank our excellent and dedicated working group and, of course, diane oshima and her team we look forward to bringing the plan to you later this year. now today my entire director's

report will be focused on our strategic plan and the specific two goals that relate to economic recovery and vitality. i have a presentation today on our economic strategies that the port will undertake in the next few years to ensure a stable, successful, and economically viable waterfront and port organization. it is time to update our 2021-2025 strategic plan to reflect these new and innovative strategies. if we could go to the next slide, please. my goal today is to update the port commission and public on the new economic and recovery gross strategies that will be implemented this year through 2025 that are designed to advance economic recovery. i would like also to report out on the innovative strategies to

create an active and organization in this time of covid-19. i want to acknowledge the key divisions, maritime, real estate, and development. finance and administration and engineering that developed revised objectives and strategies and i'd like to thank our entire team to ensure that these goals and objectives have integration. finally, a thank you to kristin salvi who organized all this to accomplish this if i could see the next slide please. these goals are economic recovery equity, resilience, sustainability, evolution, and engagement. today, we will focus on economic recovery and economic

growth. to the port strategy has three economic pillars. these three strategies are integrated in all ongoing work. we have learned about these inner connections or how to multi-solve without considering equity and economic recovery, we are not building back better to coin a phrase used now. and we are not taking the opportunity to create a vibrant waterfront for everyone without equity, we will not have a sustained recovery. and an economic recovery strategy without resilience will only be surfaced and will not withstand the time. and plant the seeds to support a long game for our

organization and this needs to provide an equitable future that is resilient. if i could go to the next slide, please. the purpose of the port's strategic plan is to set our overall vision in the mission statement the port commission's vision and mission for the water front. the plan and sets the port's allocations of resources for the next few years. i am proud that the updates to our economic section of this strategic plan demonstrate coordinated strategy to address water front. it identifies foundational issues that must be addressed. it ensures an integrated

approach to financial recovery and sets resourcing allocations. it holds leadership accountable to the team. and it communicates ongoing work. next slide, please. the strategic plan is a living document. it's a working document that will be updated to ensure the port's strategy. we ensure that the plan is updating other key documents. the ten year capital plan. city policies including the burton act and we ensure that the plan is designed to recognize the shift that covid-19 has caused and the port's unprecedented financial outlook as a result. to the next slide, please. why do we need an update in our strategic plan. it's very good to report that we have made significant accomplishments advancing the

plan this last year. i reported this out at our year end 2021 impact report and you can find this report at sfport.com. while we have accomplished to be proud of, because of the continuing covid-19 surges and changing public health conditions, we are far from recovery. our pre-pandemic revenues and visitor counts have yet to return and as you know, the port is expecting at least a five year recovery. we are so thankful to the american recovery stimulus plan that give us a grim financial outlook. these funds provide this reprieve and it gives us an opportunity really to rethink and unlock innovative economic strategies. as you know, the funding allows us to restore cuts we made last year and to evolve projects and programs that were deferred.

the budget before you today and the strategic plan updates i am discussing now reflect these early strategies. commissioners, we are not out of the woods. with your leadership, we will take each measured step and we should find our way to stable financial footing. to the next slide, please. our finance director nate cruz directed this to you before. it reflects the a.r.p.a. and how it will write our books for two years. it allows us to reinvest in programs cut due to covid. it shows the five-year recovery period expected and the growing $8 million short fall we still need to solve for by 2025 and beyond. this organization had enormous wins, but challenges remain. to the next slide, please.

so, with that, i'm excited to jump in to the economic recovery goal and strategies. our goal is develop and implement strategies to address the economic impacts of the covid-19 pandemic and stabilize the port financial position during an expected five-year recovery period. and we will accomplish this with three objectives. tenant recovery. targeted activation, and enterprise economic recovery. to the next slide, please. our tenants. the port will work with tenant who struggle from covid-19, continue to struggle and we will attract new activities to ensure an economically vibrant water front. we are going to implement policies and programs that attract diverse communities and activate the water front. we're going to use our pop-up

r.f.q., concerts and other events with those responsibilities. [please stand by]

-- for revitalization. and two parts in open space. those on the popularity of people's enjoyment of the waterfront outdoor spaces and here we want to activate our parks and open spaces to ena hans our experiences and welcome more diversity. strategies include advancing the ymca partnership for building 49. and we now understand and have always understood that creating safe and inviting areas is key to our economic recovery. to the next slide, please. this is a very wordy slide, but to port economic recovery. we're not just focused on external strategies, we're going to be looking internally to reduce the projected deficits from fiscal year 2025 and beyond. to do that, first and foremost, we need to support and include our staff. we will identify efficiencies to sustain and improve delivery of key services. these efforts will yield midterm

improvements but are also very critical to sustained financial health in the long run. and our resource allocation, to our objectives, the budget includes an economic recovery czar. we need this person to develop proposals to reduce costs and to uncover those inefficiencies that hamper our staff. these include items that we have known for a long time that need to happen, but they are harder to implement. doing so means that we need to have the discipline to turn away from urgent issues and have our leadership commitment to focus resources and sustain the tenacity to achieve operational efficiencies. the stakeholder engagement. we will collaborate with internal and external stakeholders to perfect our plans and to be ready for implementation. project management. our economic recovery czar will prepare an economic recovery plan in this year that

identifies key initiatives, including benchmarks and tracking of those initiatives. and the results financial performance. this plan will include selection and implementation of at least three strategies that combine and generate $3 million of ongoing revenue, enhancements or cost savings. and we need to close an $8 million gap by 2025. and to our funding strategy. we'll work with federal and state delegation this year to secure federal infrastructure grants and state funding for targeted capital investments that advances our maritime business, reduce earthquake and flood risks, and protects key facilities for the public. we will need you port commissioners for your advocacy, like we had in force for the american rescue plan dollars. we have certainly shown capacity here and your ongoing support is just so critical for our organization's success. the economic recovery goals and

the objectives in the strategic plan enumerate how to recover from the covid-19 economic impacts. to the next slide, please. now, to economic growth. the second goal -- this goal and objectives enumerate how we'll grow the business portfolio to create an economically successful and vibrant waterfront. we have set five strong objectives to ensure our organization flourishes to pre-pandemic revenues and beyond. in the maritime portfolio and property portfolio and our historic facilities and our exceptional places and capital. next slide. the maritime portfolio. maritime has been so very important to the waterfront revival this last year and it will continue to play a critical role in years to come. we will advance the maritime business to increase revenue and activities. and this spans from cargo to

commercial fishing and water transportation. cargo -- maximize opportunities at our deep water cargo terminals. the crews will need to evaluate facilities to support our expanding cruise business. we need to have the calls and the infrastructure in places to receive those calls. the pier 70 shipyard. identify maritime opportunities for revitalizing select parcels at the shipyard. we have a strategy that should bring us near-term revenues for peas 80-96 and backlands to pursue federal and state grants to investigate site improvements to increase lease ability for by 2025. and we're increasing fishing at fisherman's wharf and hyde street harbor. and to water transportation we're expanding the water transit system and promotion of waterfront -- of water transit.

next slide, please. through our property portfolio, due to changing covid-19 requirements that have restricted the public from gathering and the resulting economic activity impact, the port's real estate portfolio has really struggled, but we are optimistic that we can reach the strategies to increase the port revenues to pre-covid-19 pandemic levels and beyond by 2025. building improvements. here we're going to invest stimulus dollars in facilities to increase the property marketability and rents. high impact opportunities. we're going to utilize portland efficiency efficiently, like the fire training facility project. you have an informational item on your calendar today on that. diversified portfolio. use increased marketing efforts and targeted building improvements to attract tenants in various industries that will

perform well through economic cycles by 2023. and the diversity of our portfolio has been one of our key strengths of the port over time and we need to deepen that diversity, especially in the light of the changes to the market that covid-19 has created. occupancy rates to maintain equal or greater than market benchmarks in comparable sectors. and for marketing, leasing and key marketing positions this year to increase the property occupancy. we absolutely found that we have to invest in and still our key positions to be successful. holding positions vacant to save money is not our economic recovery strategy. the next slide, please. this is about our historic facilities. the port has nearly $2 billion in our capital backlog. that's why our historic facility partnerships, public/private partnerships play such an

enormously key role in our funding strategy. it is these partnerships that have resulted in transformation of some of our most treasured facilities. and i'm proud to work together with our partners to ensure resilience and equity is incorporated on our waterfront for today and for future generations. we will work with our private partners to activate, restore and rehabilitate the embarcadero piers from the maritime, public serving and public spaces. we will need to use profitable uses such as office to fund these improvements. here we will devise for the projects have financially feasible projects, not an easy task. put them out to bid. and to let partners for at least six facilities for rehabilitation. we will ensure that these projects include resilience and equity benefits and we will do this work by 2026.

select partnerships using criteria that highly-ranked teams with strong equity records and experience delivering programs with maritime, resilience, and public space activation uses. the benefits -- deliver public enjoyment, resilience, maritime, and historic rehabilitation benefits for piers 38 through 40, seawall lot 330, and piers 30-32 projects through 2025 through 2027. these projects are underway as you know. the financing that we're going to collaborate with our partners to secure our innovative financing, historic tax credits, green bonds, and other public and private funding sources. financing has been a key to our success. to the next slide. exceptional places. the port under this port commission's leadership has a very successful track record, creating exceptional waterfront

places, such as 88 broadway and mission rock. staff and our partners have a big job of implementation. we will continue to advance these transformational projects to create sustainable and diverse and resilient communities for future generations. we have mission rock. we will continue to advance that waterfront community. pier 70, we're going to partner to remove obstacles to break ground on vertical projects. and parcel k north, partner with developer to build new open space at 20th and illinois street and new michigan street by 2025. and teatro zinzanni, partner with a developer to build a new home for entertainment venue, including a new 280-seat performance, a new boutique hotel and 14,000 square foot park. city legislation, we need to assist the city in accepting streets and, tills at pier 7

scott mission rock this year. and financing tools, we will use pier 70 and the historic tax credits to fund capital improvements by 2024. public bonds. we will continue to use our community facility district bonds for pier 70 by 2023, and we'll do the issuance in consultation with the city to advance the project. to the next slide, please. now, i look at the last economic growth objective as a big opportunity, not only for the port, but for our city and for its residents. in the next few years, we will use american rescue plan act stimulus funding and port capital funds to deliver $60 million of funded capital projects by 2024. we will use -- we will complete improvements using the stimulus dollars on time. in terms of partnerships we will continue to partner on our

projects to become an owner of choice and when at least win one department award per year. and to our business opportunities, we will provide construction opportunities for local small business enterprises with a focus on bipoc-owned businesses. to the next slide. to the next steps. i want to thank you all, port commissioners, for your leadership and we look forward to reporting updates on the equity and resilience plan sensions next and, of course, coming back to you later this year with our end-of-year progress and 2022 impact report so i thank you and that concludes my director's report and presentation. >> president adams: thank you for your report. let's go to public comment. jenica will provide instructions now. >> clerk: thank you, president adams. at this time we will open up the queue for anyone on the phone who would like to make public

comment on the executive director's report. please dial star, 3, if you wish to make public comment. the system will let you know when your line is open. others will wait on mute until their line is open. comments will be limited to three minutes per person. the queue is now open. please dial star, 3, if you wish to make public comment. president adams at this time there are no members of the public on the phone wishing to make public comment. >> president adams: commissioner gilman. >> commissioner gilman: thank you, director, for this really detailed report. i really appreciate it and i wanted to say that i'm very intrigued and supportive of having someone who is truly focused on our economic recovery. i just have a couple of

questions. so for that position that we're crafting, i guess that i'm just curious if there's been any thought from the senior team or from yourself of after 2025, moving into the future where we have sound economic recovery, what tasks or responsibilities or scope would that position continue to have? or do you view that as a temporary position within the department that would phase out once we're roaring back economically? >> that's a very good question, commissioner gilman. as we have it planned now, it would be a three-year project funded position that focuses on our near-term and long-term strategies. so as i see it, these strategies that we're talking about ongoing cost savings or revenue enhancements and they will go on into the future past the economic czar's programs and implementation. however, we have a structural deficit that we had before covid-19.

that's why we have a $2 million capital backlog. it is very strongly possible that we may determine that it is worthwhile to keep the position on to tackle other items. we have several areas where the port could use economic strategies. especially in our capital programs. so long and short, i'm saying that right now we're planning it as a three-year position but it is possible that we may see the value of continuing the position past that point. >> commissioner gilman: thank you so much. and i was just wondering if you had the ability to do it, you mentioned in your report that part of what the czar would be working on along with the senior leadership team was sort of streamlining processes, or looking at how we internally do business. and you said that some of those are long overdue that we tried to pivot to the emergency and staying focused sort of on the long-term process fixes.

could you give a very brief example of one of those process fixes or one of those areas that you're hoping to really achieve from an efficiency perspective? >> yes. we have an asset management system that the maintenance division relies upon and all port divisions rely upon to put in work orders, for requests for work. that asset management system sits on the backbone of a big oracle infrastructure, oracle financials that the port has not used since the city implemented people's block. so we have a system with one module that we're utilizing. we to get off of that whole system and start to use an asset management system that is less expensive to use in terms of it and staff resources. what we're doing now requires a lot of double and triple entry and it is just very, very difficult. that's one example.

typically what i would be describing is something related to i.t. and something related to legacy systems. but there are also other processes that we have that just, frankly, need updating. they are long-standing and they haven't been reviewed in a long time and we know that they're inefficient, and folks having to implement them know that they're inefficient but we haven't been able to take the time and put resources into implementing something better. >> commissioner gilman: i appreciate that and i appreciate your report and i look forward to your other updates and, again, thank you for centering equity in every aspect of the updates to the strategic plan. and i don't have any other questions. thank you so much. >> president adams: commissioner burton. commissioner burton? >> commissioner burton: no comment.

>> president adams: no comment. thank you. commissioner brandon. >> commissioner brandon: elaine, thank you so much for this report. it was very detailed. and really happy that we're taking the time now to update the strategic plan because there's so much in front of us, but i do want to say that your team have done an incredible job of weathering through the last two years and getting resources and making the waterfront safe and accessible for our tenants and our visitors. so i really want to thank you and the team for that. and i think that it is absolutely phenomenal that the waterfront land-use plan is in the final stages and, diane, and i wish her and her team and the working group just have done a phenomenal job with the waterfront land-use plan update there were a lot of great details in your report. and, like commissioner gilman said, i am glad that we are

focusing on economic growth and recovery and equity combined, so that in this recovery, everyone will feel welcome and able to join in on all of the opportunities available at the port. i wanted -- my one question is about the zinzinn everyonea, i didn't see a date with that one, so i'm wondering where are we with this, and is it time for to us get an update? or is there state that we think that we may get to a certain point, or move forward? >> that's an excellent question i have some in my notes but instead i'll turn it over to rebecca who is our director of real estate and development. >> thank you, elaine. hello, commissioners, good afternoon. i can answer a bit about that. the developer has utilized not surprisingly some of the provisions in their lease development and disposition

agreement to have the signing of the lease. when they sign a lease they must start construction so they're gathering their financing for construction. and we are heartened they have submitted building permits so we have building permits that we are reviewing that are in line with the design of that theater and hotel. they are spending money on design and processing fees and are just working hard to get that financing in place and not surprisingly they're pointing to occupancy rates to hotels in san francisco. there is some positive news on that front, so we hopeful that this is the year that we'll get that lease signed which is then a signal to start construction. i'm happy to do more updates in the future if you have an interest in them. >> commissioner brandon: great, thank you, and it will be great to see that project to start construction because it's such a wonderful project. but, elaine, thank you again for the report and i think that there's some very aggressive goals in this report but i know

that you and your team can make it happen. so, thank you. >> president adams: thank you, commissioner brandon. vice president woo ho. >> vice president woo ho: thank you, elaine, for this great report. i honestly have been through it already with you once, and i have to say that i just want to mention the strategic plan evolution over many years has continued i think to expand and to be comprehensive. and this update is certainly fits into that category of the thinking that keeps evolving with the challenges and the circumstances that we are facing and, obviously, we are facing some unexpected circumstances in the last couple years, but we're kind of meeting that challenge now. and i think that it is great timing that we are rethinking the strategic plan, because we now can catch our breath a little bit because we know what we have faced and what we're facing and while it's not over, at least all of the steps that can be taken to address it for

the short term have been. and it is now time to think about the longer-term, both the short term and the longer-term strategic steps that need to be taken. and i guess that to commissioner gilman's comment, as you and i chatted, i really do think that we're just not focusing on the strategies for the next three years, but really for the strategies that are much longer term. and to place that capital budget deficit and what else can we do but you're starting with the right sort of steps to take the short-term steps, and i think that we applaud you and your staff for thinking that through i think that it is very comprehensive, excellent job. so i think that we're all happy to see it. and glad to see that you can now take the time to think about it and also make sure that the resources are there, the team has the mental space as well as the time to think about it. and i think that it's going to put on a great trajectory. as you know across the bay there's been a major -- i guess

a pool -- at least the equivalent to the board of supervisors, the city council, that they're just approved a major development with the ballpark and everything else. and i think that we need to be clear and watching what they're going to do and what we're going to do. we should be very imaginative in how we envision our waterfront. i'm not saying that we want to take anyone's thunder, but we should realize that we are going to have some more competition down the road in terms of people looking to develop more diverse and vibrant waterfronts. i thought that it was kind of interesting. i mean, of course, it will take many years but i think that we should not lose sight of the fact that is happening across the bay. good for them. i mean, we all want to see them stay but i think we should make sure that we're on top of it and that we're aware of what their plans are as well as i'm sure that they're watching us and seeing what our plans are. because a lot of that development is not just related to there, and not related to their cargo, it's really related to what we've been doing for a

long time, correct? i asked you a question. >> yes, indeed. it puts oakland into a position to have major investments in their commercial waterfront activities and as you know jack london square has been very good resource for the community in oakland with lots of retail, restaurant activities. but this is really a generational investment in that waterfront that, you know, will be very, very transformative. so we will keep a close eye on it. we have a lot of excellent, excellent offerings for the public, from the exploreitorium and i think we'll stay on top in terms of commercial activities that welcome the public to our waterfront, but we can't -- we can't assume success. we have to as i discussed in

this strategic plan update, really, really work on our exceptional places and our safety and vibrancy and our equity. we need now to lean in to these opportunities for our waterfront to ensure that we are -- what we have been in the past and we continue to grow. so thank you for reminding us of that big investment. and we will stay on top of it. >> vice president woo ho: thank you. >> president adams: is that all, vice president woo ho. director forbes, you know, great report. and the situation is so fluid but i'm not so much worried about the waterfront over there there's a lot of hurdles and obstacles and there's a big opposition to the stadium, and you have vegas and oakland competing. i think that -- i think we do have an advantage. i think we've been doing it for a long time and i think we're getting it right. and we have been transformative

i mean, i have only been on the commission nine, 10 years and commissioner brandon, was on here before i was, but i would never have thought that we'd be talking about a recovery czar. that ain't something that we even talked about at the port, right? that is something that you hear at the white house, a port czar, and this kind of a czar and now we're talking about a recovery czar, and i like that. and i like the short term and i like the long term. and it's good to know that all -- you and your staff are putting things in place, no matter who is here, it will -- it will just kick in. and it will take care of itself and i know that has been a big thing for doreen about what the biz looks like going down the road, say something that happens, and i think that you're laying that out. i think that you have heard that. and with your team, i'm -- i'm really impressed. i just thought that it was so thorough. >> thank you so much.

>> president adams: thank you. call the next item, please. >> clerk: item 7a which requests approval of the fiscal year 2022-2023, and 2023-2024 by capital funding and that is resolutions 2209 and 2210. >> president adams: okay, at this time we have katie and nate cruz to give us a presentation. >> good evening, commissioners, i'm nate cruz with the financial division to request approval of two resolutions. the first is the biannual operating and capital budget for fiscal years 2022-2023, 2023-2024, and to use the arpa stimulus funds in the current fiscal year in 2021-2022. next slide, please. so before we get into details, i

want to kind of refresh our collective memories. two weeks ago i was here with an informational item and to provide quite a bit of detail and context about the budget context in which we're making news on this decision. this table provides a great overview of the three -- or the three real critical elements that we need to think about when we are deciding on how to allocate our precious resources and whatever is left is to invest in our facilities. you can see in this upcoming biannual cycle, in the 2022-2023, 2023-2024 balance, we have pre-covid or exceeds pre-covid levels and expenses that are restoring services and positions to pre-covid levels.

and a really significant level of capital investment. and all of that is made possible and the out years is where we see pressure as we need to continue to maintain critical services and investments in our facilities but we're still waiting for tourists to return to the waterfront and our revenues haven't quite recovered yet and that highlights the need for us to execute on that strategic and economic vision that director forbes just referred to. next slide, please. so in my presentation during the informational item, a number of questions came up, as well as some additional questions that came up in some individual briefings. and so i'm going to try to address those broadly and then leave a lot of time for questions. and the first set of questions seem to get at providing more detail on the changes in our budget by division. two weeks ago we provided sort of an overview of the port as a

whole and how changes were seen at a higher level. what you are seeing in this slide in front of you is a little bit more detailed breakdown by division of the port. and i won't go through each row, but i'll discuss some of the major drivers in each division. (please stand by)

>> so we needed to pro invite a cushion in our budget and in case the prices are increasing from the previous contracts and in administration, the largest percentage increase is also a non personnel services and that $188,000 increase comes from us restoring an expensive that we hope it's an expense for judgments and claims that may arise throughout the year and we eliminated it through covid and to reduce the size of our budget and it is still prudent to have that budget in case something

comes and and hopefully with deneed it and in the maintenance division, the big story there is restoring our equipment budget which shows in this table as capital outlay but it's budgets speak for equipment and we're also restoring our materials and supplies budget to pre-covid levels. next slide, cruise are coming back and this is actually good news right, these work order funds provide sure side power and security services for crews so this is good news and we spend this money again and we'll see more cruise ships and tourists back on the waterfront and the planning and environment division, we're seeing a savings in the services of other departments and that savings of a little under $300,000 has to do with our waterfront plan and advancing to the stage that it is now and we don't really anticipate needing the services that the city is planning department quite so much as we

had in the past and so we can achieve savings there and in the real estate division, we see a significant savings also in non personnel services a a savings of $750,000 in the first year and it's being driven by the successful renegotiation of our rent and for our pier 1 offices and this was the tenth anniversary of our lease and reset to market and we've came out of that negotiation a little bit in a better situation than we assumed in the original budget. next slide, please. the other area of questions that came up had to do with aarpa. director ford mentions, it provides us an economic reprieve with the $114.8 million allows us to restore projects and programs that were cut or deferred due to covid and allows

us to avoid staff layoffs and back fill, critical positions that we left vacant to achieve savings and to invest in our facilities again and we've been approved the first half of that funding at $56.6 million and we think the second half will be confirmed in the next few months and hopefully by april of 2022 and there's two pieces of legislation that are related to arpa and the accept and expend resolution and that's what is one we're asking and that is the use of arpa in the current fiscal year in 21-22. the other accept and expend resolution which has to do with the use of arpa funding that will be submitted with our budget and goes to the mayor and the board of supervisors in may and the other thing to always remember is we have to spend the money by june of 2024. next slide, please.

the question that came up was about the allocation of arpa funds and they're between a couple of commissioners noted that between our submission to the state lands commission and the staff report, there had been some riel occasions and what you are seeing here is where the final budget landed and what we did it was disproportionately impacted by covid and made sure we kept that funding level consistent to what we told the state. what happened in between the submission to the state lands and our first informational item when we put together the budget, was basically the significant rain storms at the end of last calender year reall illuminated

so we needed to make funding available to address the critical need that generates important revenue for us. next slide, please. and then, let's see, commissioner, i believe you asked about a little bit more context about how we were going to make sure we met that june of 2024 deadline and it's one thing to appropriate them and another to execute so what we've included in the budget are resources to make sure we can deliver. first and foremost are two new project managers for the project management office that manages our capital projects. we're re-assigning a vacant financial annalist position to contract administration and to help award those contracts that are always a part of capital projects and we're fully funding the engineering as needed contracts for design and creating two positions.

one for building inspection included in arpa and finally, we talked about back filling positions and creating these new positions we need to help hire those so we have identified a new hr annalist position to help fill those vacancies. the last set of questions that came up in the informational item had to do with status and so two of the five new attachments to the staff report had to do with capitol, one attachment, nine is a drill down into the southern waterfront beautification fund and it's a look at call of the capital appropriations since 1920 so if you look at that attachment you will see everything with a material balance in fiscal 19-20 and what we've added to it over

the last couple of years and also what we defund it and if you remember last year about this time, we identified some lower priority projects and some administrative clean up and to achieve savings in the capital budget and restore our fund balance to maintain critical operations. so you will see that in the report as well as what we're requesting you to approve with this resolution here today. on the capital front you asked for a little bit more details on the waterfront resilience program and we're putting it together. we're asking for your approval today is roughly $3 million over the next two years of port harbor funds to support the resilience programs but there's bond funding and we're asked to provide a overview of how those work together and we're still working on compiling that and we'll be back in the next few months with information and so

that will be coming following this item. next slide, please. so, where we are today, we've already been through step one and i'm asking for your approval to those two resolutions, the by annual budget and acceptance and adventure of arpa and also today, right after this meeting i need to submit our budgets to the mayor's office and controller and come march and april and in may and june we'll submit our full by annual budget and to the board board of supervisors to the normal budget process that the city is experiencing, next slide, please. so, that covers the highlights of the new content in the staff report but i'm happy to answer any questions that you have. >> thank you, nate for your

presentation t is there a motion to approve the resolutions? >> i so move. >> second. >> we've got you, thank you. let's open up a public comment. we have instructions now. >> thank you president adams. at this time, we will open the queue for anyone on the phone who would like to make public comment on 7a. dial star 3 if you wish to make public comment. this system will let you know when your line is open. others will wait on mute. comments will be limited to three minutes per person and the queue is now open. please dial star 3 if you wish to make public comments. at this time, there are no members of the public on the phone wishing to make public comment. >> public comment is closed.

commissioner brandon. >> thank you so much for that presentation and thank you for all the work that you and the team have put and katie have put into the presentation and all the documents. thank you for meeting with me three times to go over this budget and to help me understand exactly what we're doing and where we're going with it so i really appreciate that. i don't think i have anymore questions. i think we have resolved everything so again thank you so much for taking the time and i'm sure we'll be getting a little more information later on and if i have any further questions, i'll definitely reach out. thank you. >> thank you commissioner brandon. commissioner burton. >> comments it's great

information. >> thank you, mr. burton. >> commissioner gilman. >> i have no other questions and i'm supportive of moving the budget forward. thank you, staff, so much for your diligence and your details and you've answered all my questions. >> vice president. >> thank you. i also have all my questions answered in briefings and very detailed, a lot of great work went into it and i appreciate it very much. supportive so i have no further questions at this time. >> katie, nate what's can i say. no questions. i have none either. [laughter] so, we will vote. [roll call vote]

>> motion passes unanimously, resolution is 2209 and 2210 are adopted. thank you both very much, next item, please. >> that would be item 8a which requests adoption of the 2022 uncollectable balances write-off policy resolution 2211. >> rebeca will give us the presentation. hi, rebeca. good afternoon, commissioners. i'm just plugging in and i'll go out of sight for just a moment. your deputy director for real estate and development and i have a follow-up to our conversation on february 8th. today i have before you an action item for the adoption of a new uncollectable balances write-off policy. i want to thank so many people that helped me with this item. our finance department and peter yee and recognize rona sandler and her work in the city

attorney's office as well as michelle sex ton so thank you everyone and i'll go onto the next slide. i'll begin with a summary of what we discussed last time on february 8th. then i'll focus in on edits to the draft policy that reflects some of our conversation and i'll point out new information that was in a staff report and i'll close out with staff's recommendation. next slide, please. first just making sure we have our defenses straight which is really important as you consider adoption of the policy. they are no longer on our property and the city only will write-off balances sort of city wide for all the departments after they exhausted commercial and reasonable efforts to collect the balance. next slide, please. want to make it clear

distinction of write-off versus settlement and we'll bring you an agreement and it's a settlement agreement and distinct from the write-off and settlement agreements are with tenants in place and write office are for tenants who have left the premises and have vacated their key amongst them is to implement strategies to stabilize our financial position as i go through some of the numbers, this will be more clear and as part of the economic recovery goal we have operational efficiencies as one of the tactics that we need to implement in order to recover

and carefully use our staff time. next slide, please. the proposal here before you today is to replace the resolution 8483 to update it to more closely or to exactly match the actual operations that take place from that older policy. the proposed policy makes clear all the necessary steps when we look back at the old policy we often have to remind ourselves what we meant in 1984 so this policy will eliminate that ambiguity and because there are entities involved, the support staff the city attorney office and controller it will be clear for all the parties who have acted and when. next slide, please. as a bit of sort of data about what we're talking about --

>> we've lost rebeca momentarily. she'll be back.

>> i'm so sorry about that can you hear me. i'm sorry, thank you for your patients. >> all good. >> so i was going over the 10 years of data we have on write office that are city attorney and others were able to compile for us. so the write office we've done over time are rare and very interesting if you go back to 2008, you can sort of see the economic cycles in place and during the great recession we got up to five seven write office and the sums totaled at the height of this period $882,000 total and on average over the 10-year period we've averaged three write-offs and $264,000 per write-off. next slide, please. we think this may be different for the next couple of years. as i noted in the staff report, we had a couple underline

sentenced to be clear about new information. the current accounts receivable sum to seven i'm sorry the typical balance. each month our property managers who are in communication with our tenants look through the list of total out standing balances and they make a judgment 25%, 50%. 75%, 100% or 0% how much of that money may be collectable or that we were actually receive. the current estimate across the accounts receivable balances is that we will settle or write-off about 60% of that balance so large number $14.8 million at this time and these estimates change each month as conversations with tenant ebband flow and i want to note f the $14.8 million, several million of represented by forgiveness a amendmentments under the previously approved forgiveness policy that the tenants haven't executed on

because there are other disputes in their lease so a couple million we believe will be settled through the forgiveness and others in settlement agreements that come before you due to the size of the settlement agreement and another portion will be written off because we anticipate at some point tenants will vacate without paying. next slide, please. so here the steps in the new policy and i'm going to go over in more detail the steps that will be underlined that are changed from the february 8th policy proposal. the first we confirm we have possession and second we determine leaving port staff determine if the account is uncollectable. by going through these steps and attempting to collect and preserving evidence and settlement agreements and applying any financial instruments that we have and then conducting a preliminary business and assets search and if the data has funds to

potential pursue we move on to step 3 which is the next slide, please. thank you so much. the city attorney will then assign a deputy city attorney to work on the business and asset search and value wait success of litigation and success for collection. we'll analyze the case with the city attorney. if it results in one of the aboc shown below we would recommend a write-off to the controller and so if the debtor has insufficient assets to pay or if they have assets the cost and the risk of pursuit and collection outweigh that potential of receiving the money and if there are no other policy issues at issue in the particular case then we would pursue that write-off to the controller. and i mentioned earlier the policy issues that we might consider if the tenant has a significant damage to the property and there's some other reason to pursue the tenant and even if we don't think that we can potentially collect

sufficient money to that is a staff member that if all three concur in the recommendation of the write-off we would send all the court commissioners the recommendation and we have a number of currently we're providing the monthly leasing and reconciliation reports as an example. i can invasion inserting notification of a write-off in this report so we notify the court commission and we would wait 30 days to make the actual write-off actions. this concept we came up with after the discussion on februart commissioners visibility into this process and provide some time in case port commissioners are interested in finding out

more about the particular tenant especially in cases where you might have heard of the tenant before if we were in negotiations for a settlement that ultimately fell apart. so after 30 days the accounting staff would implement the write-off into the financial system and that would be the sort of permanent action at the conclusion of the whole policy. that concludes my presentation. we recommend approval of the attached resolution 2211 replacing the 1984 policy with the 2022 policy. thank you so much, commissioners. >> thank you for your presentation. commissioners, is there a motion and a second. >> so moved. >> i'll second. >> we have a motion and a second. let's open it up for public comment. general i can a will provide instructions now. >> thank you president adams. at this time, we will open the queue for anyone on the phone who would like to make public

comment object item 8a. tile star 3 if you wish to make public comment. the system will let you know when your line is open. others will wait on mute until their line is open. comments will be limited to three minutes a person. the queue is open. please dial star 3 if you wish to make public comment. at this time, there are no members of the public on the phone. wishing to make public comment. >> ok. public comment is closed. commissioner burton. >> no comments. i'm in favor. >> commissioner brandon. >> rebeca, thank you so much for that report. so, i know we're in new waters here, we're chartering new waters here and we have such an

expanded list of settlements and write-offs so i wonder what percent of that 60% do you think will be written off? >> thank you, commissioner. i would have a really hard putting a number to it. i am really sorry about that. it's hard to do given what we're hearing so far. >> and how much was the average per write-off are you expecting? >> i think i don't have any reason to believe it's out of line with what we've seen in the past. we still have the typical size of a tenant's lease hold is not much larger than it's been in the past and it expects the dollar value to be similar the last 10 years and it's just a number of write office to be wre higher in that makes sense. >> yeah, to be me, i've seen the monthly report but i haven't

analyzed and i don't know which ones are uncollectable. and so it's really kind of hard for me to just -- i understand the difference between the settlement and the write-off and i know that when we write something off we have all these provisions but i'm still leary of just giving open access to writing off without us knowing and i don't think given the notification in one of the monthly reports is adequate and because for months we didn't get those reports. because we have so many and this will affect the port's balance sheet, i think there's going to

be a better way to inform the commission whether you bring it to us quarterly or do some kind of presentation or something to let us know exactly what we're dealing with. because this could go on for the next few years. it may get larger. we may have more write-offs so it's hard to say ok, regardless of what the amount is, regardless of who it is, if you have to write it off, write it off. that is just my feeling. elaine, do you have a thought? i only have one first thought from the balance sheet perspective our finance team is incorporating the anticipated write-off and that effects so sort of that monthly accounts

receivable report they've taken into account how much money we actually think we will collect so we're not spending beyond our means while we're trying to collect on these balances so from the financial reporting standpoint we're on strong footing in terms of projecting revenues coming forward and not over spending and based on a erlarger accounts receivable and i'm happy to think it over for a moment to think about what might be better than having just the note and the 30-day cold period. >> i'm trying to think about a better method of reporting and i did want to remind commissioner brandon that these accounts that are uncollectable, they have been verified from our city controllers office and we really can't find a way to recover at this point and i was going to

suggest a consent item that that might be more than we need. perhaps a update and a reference in the director's office and if there's any discomfort or comment about it we'll bring it to the commission as an item. something like that? an opportunity to comment if there's any concerns then we would bring it as a consent item or an actual item and the key here is that no one feels that they can recover on these balances, there's just not a party to continue to seek from or at least that's the determination of staff and city attorney and controller. >> and so once a customer has a write-off, how does that effect their ability to do business with the port again? [please stand by]

whatever we can to help our tenants stay in business. you know, if they can. and so i think that should be our first goal, to is help our tenants. so -- so i have a business. and my business goes bankrupt and you write off whatever debt i had and i start a new business. that's a whole new tax i.d. number, that's a whole new thing, but then again, i can come and lease more property from the port. so i'm just -- i'm just trying to think of what we can do for transparency so that we really understand who we're doing business with. and understanding that, yes, it may be uncollectible today, but a year from now, it may not be. i don't know. but i'm just thinking more transparency and something that

the commission can follow to understand. and because this is unprecedented, you know? and so i think that maybe we should try something in the beginning until we feel comfortable. i mean, i understand that we're saying it's uncollectible, but is it really uncollectible? and maybe one of the commissioners may know that organization, or know that they have other businesses. so, just trying to find a way that we can be a little more transparent and that you can keep the commission, you know, up to date on what is going on instead of just an open-ended write-off policy. >> as we proposed it, it's 30 days before taking the action, as i recall. do i have that right? perhaps what we could do in addition to receiving the report for the commissioners, i could talk about it in the director's

report 30 days before action. if any commissioner has a comment at that point we would bring a item, if there is one or two of the accounts that you're concerned about, or you're concerned about all of it and want more transparency. you could direct us at that time to bring and item and we could see how it's going and if there is more commission interest in it, you can re-refer from the director's report and then we wouldn't take action on what we were re-referring on and instead we would bring the item to commission. >> do you think you could include the report in our monthly packets? >> i think we can. rebecca, what do you think? >> for sure. and you're referring to the monthly a.r. and leasing package, i can. >> the monthly staff report. when we get our items, have the report in that? >> i see. >> is that doable? >> yes.

i think so. as a separate report to the packet. and then we could -- and we would anyway maybe this -- this is public record anyhow. we would just be consolidating that in a report that would be an added attachment to the agenda. >> just a memo to the commissioners. >> yes, i think we can do that. yes. definitely. >> thank you. >> president, i better ask before you move on, did you get all your questions answered? >> good. commissioner gilman is on fire. come on, commissioner gilman, you're up. >> commissioner gilman: i had a couple of clarifying things because as always commissioner brandon makes me think about things in a different way, or

approach it differently. just clarification. i want to reiterate. by the time you're giving us the 30 days notice in the report, the person has left their space on port property, they're no longer occupying it, they've already been vetted by the controller and the city attorney office who recommended that any further action on behalf of the port and city would just incur unnecessary costs because the analysis, in this moment time, there is no way to collect this debt? >> that's correct. and you will be surprised at how long that takes. when you start to see these reports. >> commissioner gilman: i guess that's giving me some confidence. i do think it's intriguing what commissioner brandon raised, which a maybe larger city issue. maybe we can ask the city attorney office to comment on it, i'm in an l.l.c., i dissolve it, we go bankrupt, i then pop

up and do another one or have shell companies under shell companies that i'm still the person as the principle officer you know running that organization. so i think it's interesting how we ensure we don't release to someone who is a bad actor or might put us in this predicament again. i think that's an interesting aspect. i think it's good for the city to consider, so when someone is renting space from the airport and then went belly up and the airport wrote off their debts, to turn around and try to rent at the port. i thought that was an interesting aspect to think about. and i'm fine with all the mechanisms around transparency that you want to put into place. i appreciate the reports. it's just us carrying the debt longer. there is no consequence in waiting 30 days to take action, it's just showing up from a

financial perspective. the tenant and the business is gone by the time it gets to us. again, i hope we continue to work diligently. i'd rather keep a space occupied and negotiate long-term payment plans with someone than have to go through this process and write off this debt and have it abandoned. particularly, since in the early item, under the worst-case scenario from a budget perspective, it says when ren leasing, it could take 2-4 years, so we would like to keep our tenants in. but i'm fine moving the item forward. >> thank you, commissioner gilman. vice president? >> commissioner woo ho: thank you, rebecca and lane for the updates and the ongoing discussion here. i just want to expand a little bit on one of the points that has been made earlier. and that is, one, i think that today in terms of when we

actually vet someone to lease and what do we do in terms of actually looking into their credit history et cetera? i mean it should be part of our standard policy to vet a lessee regardless of whether they were previously a tenant of the port or as commission gilman said, they were a tenant in another city agency or they could have been a tenant in the private sector and have had issues. so i am asking the question on the policy level, do we have ways to make sure we understand that? so that we can decide what to do? and if it was extraneous circumstances that if there was such a profile that we do not permit under our current policy to lease to someone with such a background, that if there is extenuating circumstances, that you would bring that lease to

the commission for discussion. i think that's another discussion maybe you all come back and tell us how to handle those situations as far as this policy is concerned. the other question i have is i'm not familiar with -- we deal with cash accounting and not accrual. have you run this uncollectible balance policy by our external auditors to see if they are comfortable with the process and the time when you actually recognize the uncollectible balance? because under normal rules, accrual accounting, there would be guidelines. i'm not saying they would object to it, i'm just saying are they comfortable with the process and have you checked in with the external auditors on this policy? >> thank you for the question. i see patricia rooney is coming in to answer. >> well, i would say that we

have not run this specific write-off policy past our external auditors, but they're certainly aware that we have been taking allowances against revenue based on our assumptions of what is collectible or not at fiscal year-end. so they're certainly aware we're writing down revenue, but i think, commissioners, vice president, that it does make sense for us to just pass it by them to make sure they're comfortable with this approach. >> yeah, i would suggest you make sure they're comfortable with the process and the procedures and the timing of when you actually account for it on the books. so i would suggest that before we finalize this and then you find out that auditors are not comfortable and you have to change it again to meet whatever they feel is the right process, i hate to say that might

continue the item, but i would want that checked off first. >> so you may feel more comfortable and i think we're comfortable continuing the item if that's the right thing to do, the accounting group writes off these balances way, way before this write-off recommendation. so there are two sides of the house. and the accounting side assumes uncollectability earlier than the city attorney, the controller office and our team stops trying to recover from these accounts. so the way the accounting approaches it is a longstanding policy that our third party auditors have reviewed and understood this is a secondary when we -- still, on the business side, stopped trying to collect the account. so there are two sides of this. but i think it's absolutely worth while for us to share this policy with our auditor to ensure they're comfortable. that makes very good sense to

me. and we could easily continue this item and put it on consent once we've had that occur and we can also write in the policy the amendment and improvement to public transparency that we worked through with commissioner brandon. >> right. and then my earlier question as it relates to how do we make sure to vet lessees? i'm not just talking about people affected by the uncollectible policy, but in general how do we make sure there is adequate vetting, so we don't re-lease if they've been a bad actor somewhere else? it could be bankruptcy or lots of different issues. and if you do want to lease to someone like that, what is the policy? do you bring it to the commission so we all agree that maybe there were special circumstances or et cetera, et cetera. or there are different terms for

the lease. so that's a separate item. it's not something you want to put in this policy, but i'm suggesting you think it through. because it sounds like you don't necessarily have standard steps, because i don't see rebecca telling you what we do right now. so i think it's a little bit of a gap right now, so let's handle that gap, too. make sense? >> yes. it does. go ahead, rebecca. i was going to say that we haven't had the experience where someone who has abandoned our property and was uncollectible account to our awareness came back as a different entity or same entity trying to re-lease from us, but at the same time we haven't had this many accounts. and if the city doesn't keep a list, that's a blind spot we've identified here for our own leasing.

we do have standard provisions in leasing to tenants including everything from credit checks to security deposits. but we do have checklists that confirms financial viability. but i think there is room for us to take a look at things and come back to you with an item. rebecca, did you want to add more? >> the steps we take are credit check. we do a dunn and brad street business search. they need to do a two-month security deposit. they have an environmental or other deposit that might be associated with their lease. those are the standard things we have been doing and led to not many write-offs over the last 10 years, but we're in a new situation for sure. i think we're trying to balance being a potential low-cost place for tenants with trying to make

sure we have stringent financial security things in place, so it's a real balance. the current checklist are the ones i just listed and, of course, they have to have insurance in place. i think it's worth talking about in the next couple of months. >> i would say, unfortunately, one of the things we have seen great stories in this pandemic of people really going above and beyond and being totally helpful and caring and whatever, but we've also seen the other side of human nature in this pandemic, unfortunately. and look at all this mass retail theft. people's characters have changed. an what has been unacceptable in the past is acceptable now. i'm not saying any of us, but, unfortunately, there are people in society that at the moment do not. and so i think we have to guard ourselves against the fact that this is a different time. i think we all know stories of

just amazing. the tremendous stories that we see that are just make us feel good as human beings every day and there are other stories that make us shake our head and very sad and disappointed in people's character. so, but to be forewarned, you should be forearmed. >> okay. anything else, vice president? >> commissioner woo ho: nope. i gave my sermon for the day. >> i think that we've had enough on this issue. i think we're going to continue this issue. carl, do i have to do anything procedurally? >> i think i heard vice president -- she was an original motion-maker, so if there is a second, we can take a roll call vote. >> second. >> president adams: yes. >> commissioner woo ho: yes. >> commissioner brandon: yes.

>> commissioner burton: aye. >> commissioner gilman: yes. >> it passed unanimously to table it to another meeting. next item. >> that would be 8b, informational presentation on a proposed memorandum of understanding between the port and the city's real estate division regarding the purchase by city of approximately 2.6 acres of port property located at 1236 carroll avenue in the southern waterfront to develop a new fire personnel training facility. >> good afternoon, president adams and commissioners, director forbes. jamie hurley with the development division. i'm here to present on the m.o.u. as just read by carl. next slide, please.

in today's presentation i'll begin with general background about what is envisioned and geographically where we're talking about. i'm joined by the fire department as well as the city's real estate department who will talk more specifically about the project and for the transactions required to facilitate the project. and then i'll come back and talk a little bit more about the port's role, align it with the strategic plan. i'll talk about the legislative approvals needed and there are various approvals needed and then i'll talk about next steps. so, just to touch briefly on one of the two transactions that the city's director of real estate will be speaking to later in the presentation, but the port transaction involves a 2.6 acre

port site that consists of two so-called paper streets as well as a railroad remnant parcel. all of which are currently vacant and have never been productive of functional assets to the port. the most recent lease for the property which was just for the railroad remnant parcel was for construction project laydown and had a lease rate of 30 cents per square foot per month. the m.o.u., the purpose of the m.o.u. between the port and the city's real estate division would be to convey the port property to the city in exchange for fair market value conditioned upon the successful passage of state legislation to lift the public trust from the port transport property. i'll be speaking about that state legislation more. the m.o.u. will require both port commission and board of

supervisors' approval. and then the state lands commission also has a role here which is mainly to confirm the fair market value that the port's harbor fund will receive fair market value. so, before we get into the what in talking about the project and what is envisioned, i wanted to orient you to the where. so the 2.6 acres along with adjacent privately held property that we're talking about is located in the southern waterfront. it's indicated by the star on this map. and it's just south of yosemite slough in the hunter's point. a little more about the location and the neighborhood context. this is a google earth view looking down on the site

indicated by the google indicator. the address is 1236 carroll avenue. and again, you can see yosemite slough there to the north of the project site. and these are just a couple of photos to show you the existing conditions of the site. you can see that the site is vacant. the photo on the left is from outside the gate. there is -- it's fenced off site and the photo on the right is within the fenced area. this is a project that involves a number of city agencies, so in addition to port commission, and the board of supervisors, we're, of course, working very closely with the fire department, with the city's real estate department, with mayor breed's office, and as well as with san francisco public works who ultimately will be designing and implementing the project. again, we'll talk more about

what the project is shortly. i'm very happy to be joined today by chief jeanine nicholson from the san francisco fire department and assistant deputy chief thomas o'connor and the city's director of real estate. at this point, i'd like to invite chief nicholson -- i'll turn it over to her to cover the department's vision for a new training facility. chief? >> thank you so much, jamie. greetings, port commission, president adams, vice president and commissioners and my sister director forbes. so nice to see all of you and thank you very much for hearing this item today. i've had the honor of serving as the chief of the department for almost three years and this project was from day one my top

priority. my staff and i have been looking for a large piece of land to build a state-of-the-art fire training facility for years. thanks very much to the hard work of the department of real estate and my team, we have identified the carroll street property. i really want to thank the port staff for such wonderful partnership on this project. really to put it in simple terms, commissioners, if we cannot train, we cannot do our jobs. you know, we've seen an increase in call volume growing year after year. we've seen interface fires all over the state that you must train and prepare for. and that's no longer a seasonal response, but a year-round task. and the fire department, we need to be nimble and ready for

whatever comes our way. earthquake, you name it, we have to be ready for it. and this training facility is critical for our city and state. you know, with every fire station throughout our city, you know, we pride ourselves being part of the fabric of each neighborhood we serve. and we really hope to be a good neighbor and be part of the community surrounding this property. we have begun outreach to the community and i plan to speak with neighborhood associations to ensure they feel included and really understand what this facility will add to the area. i think we can have some really wonderful partnerships. so i'm now going to ask my chief administrator tom o'connor to present some slides that will show you a brief description of what we do as our training. and some programs i'm very

passionate about that continue to grow at our new facility. i thank you so much for your time. >> all right. good evening, commissioners. i'm the deputy chief of administration and i'm here to present you a few slides on our need for a new training facility. currently our treasure island facility is slated for demolition and our back is up against the wall trying to find somewhere to train our members. right now, we're the largest fire department in northern california. and this state-of-the-art training facility will serve as a regional training center, but also help to serve all of fire, ems and rescue training needs. so we're going to break it down into three bite sized morsels. the fire department requires three academies each year and each has roughly 50 recruits.

we have training required year round for the entire department. in order to maintain the status we need a parcel of land large enough to house the following. we need multiple classrooms. we need training class for the firefighters 1 and 2 course. we need urban search and rescue, we need rope rescue techniques. we need transit training, where we simulate bart and muni rescues. we need an operations course and a california driving course. we need the agency briefing room. we need emergency operating center, somewhere to store apparatus and equipment. a shop to repair all the items and service training area as well. we also have roughly 80% of all the calls in our system are emergency medical calls. so for our emergency medical services division, we have

roughly 300 employees broken down into two components. we have the ambulance staff, ambulance deployment facility and we have the paramedic division, we call this ems prevention. we're trying to get out before it becomes a 911 emergency phone call. for all this staffing, we need the room for the academies, the accreditation. we need room for our community paramedicine training which is comprised of our street crisis response teams and our street wellness response team. we also host a bunch of state and local partnerships. we're one of the only areas in

northern california that can teach fire departments from outside of the city of san francisco where we teach rope rescue, rescue systems 1 and 2. and we also have partnerships at local payroll and state agencies. such as the state fire marshal, the signatory and the master aid agreement. we're partnered with the office of emergency services and we staff five engines that go to all the wildfires. we have the san francisco county response team. and we're part of the bay area urban initiatives and training and exercise work group. going forward, this new facility will build deeper into our community partnership which is valuable to us. we have a lot of programs that encourage locals to train in the hopes they can get a career in

in public safety. we have the disadvantaged youth in san francisco, this was developed by the chief and city partners and we target and find residents of the community that look to find a career in public safety. and we host them and train them and enter them into our 9910 program which is the public training program where we pay them to get the hours to become paramedics and emts and hopefully gain a foothold here in san francisco. we have pre-hiring orientation for our candidates that need development. we have an annual girl's fire camp which is hosted by the united fire women. and we're about to start with a new testing system that allows us to target local residents, bay area residents and again train them to become firefighters, train them to become emts, help them become

candidates on entrance exams. this will also be hosting our affinity groups, including the asian fire-fighting association, our black fire-fighting association, our women, lgbtq group and the partners in local 798. and we'll be hosting community events. job fairs, cpr training, hosting community meetings, boot camps. you can see this is not just a training center for our members, but it's also a training center for our residents and youth and our community groups and we really want to be part of the fabric of the local community and try to present athletes into careers in public safety, give someone a toehold in the mikz. thank you for your time. [please stand by]

>> you might ask why this site and why port property? what drove that decision is this is an assemblage, which means that we are taking property from two different property owners to assemble together to make a site big enough for the project. after repeated refusals from the adjacent property owner, to entertain a sale of their property, they had a change of perspective and a change of heart. through diligent negotiations, we were able to secure a purchase and sale agreement for 4.9 acres, which is adjacent to the port property. we are, right now, holding that property off market through a

purchase option. it expires in may of this year. that purchase option has a signed purchase and sale agreement attached to it and we are only waiting for the process to get the port property before the city moves forward. due to reasons regarding the state legislative calendar, we will be going to the board to ask them to acquire the largest property at risk before we get the final approvals from sacramento and i can explain a little bit more about that in a second. it is the proximity to this site that makes the port side so valuable. but the four-point 9 acres and the 2 acres from the port, we would now have the assemblage that you see in the dotted box,

which is the minimum need for the site. i really wish i could tell you that we had a plan b., but we don't. this is the only sites that we have been able to identify. it is the only sites that even through assemblage would meet the minimum standards for all of the essential activities that the fire department has described to you. now i would like to take a few moments to tell you about the transaction. again, we have a purchase and sale agreement in a purchase option with the private property owner next door. that is basically those negotiations that are completed. we have negotiated a principal and m.o.u. that you will find acceptable with the port.

the fire training facility will be paid for through easter bonds and those bonds require that we have a training facility for the life of the bond. those bonds have a 30 year life. we will give you that assurance that not only would that be used for public purchase for the next 30 years and probably in perpetuity, but it will be used for the fire training facility that the department has already described to you. we know that your approval is one of many steps that we need to take in order to get this to the finish line. we are hoping we will have your support along the way. lastly, i want to show you the legislated schedule for our approvals with the board of supervisors and this schedule

was developed in conjunction with the port staff to sync up with the port and state approvals. we will be introducing legislation for the purchase of the site and the conditional approval of the port site in march 21st of this year. we hope to be in front of the budget and finance community on april 14th of this year and we will be going to the full board for their approval in april 19th of this year. if we get those approvals, we will be closing on this site this may, just in advance of the exploration of our purchase option. it requires us to go forward because we run out of time with the state legislative process. this concludes my portion of the

presentation. thank you for your time. >> thank you. next slide, please. i have a few more slides that i will try to run through quickly. i wanted to get back to the port role in all of this in alignment with the strategic plan. our role on the port side is essentially limited to facilitating the sale of the port property to the city at the fair market value and that fair market value will need to be confirmed by the state land commission. i will mention more on that in a moment. in terms of our strategic plan, the funds that we will generate through that sale will contribute to the port's economic recovery. and in terms of sustainability, this facility will enhance

emergency preparedness in our city and our region as the fire department has spoken to you about. next slide, please. we will talk to you more about the legislative approvals needed. he mentioned the board process. in terms of the local approvals, the port commission and the board of supervisors, those will facilitate and approve the jurisdictional transfer of the property through the execution of an m.o.u. between the city and the board and adopt the findings. there are also state approvals required as referenced. we have been working very closely with the california state land commission, and going forward it will be really to confirm that the port will receive fair market value from the property. and the state legislation is

required for all of this. i will speak more about that in a moment. next slide, please. i'm really happy to report that they simply members did introduce last friday a bill that would allow us to move forward with the envision sale of the port property to the city. i wanted to highlight the fact that this is not something that the port will launch into lightly and take very seriously. and we have been working closely with our partners at the state lands commission, and with the mayor's office, and now with assembly members and their office. i wanted to highlight some verbiage from the bill that was introduced to highlight why we

would consider this. so there is a finding within the legislation that says, and i'm reading this, the property has ceased to be useful for the promotion of the public trust and the burton act trust. the property was filled and reclaimed as part of a highly beneficial plan and has ceased to be tied and is cut off from the water and constitutes a relatively small portion of the lands granted to the city and is not currently being used and is not anticipated in the foreseeable future to be used for public trust or burton act trust purposes. i just want to highlight again, that it does require that the market value is paid by the city to the port. for uses benefiting public access use and enjoyment of the waterfront. in other words, the money that the port will receive will go into the harbour fund and therefore be beneficial to the

public trust. next slide, please. and just to wrap up with anticipated next steps. tomorrow the port staff, and our partners will be briefing the port advisory committee and then later, in a few weeks, probably around mid march, the m.o.u. that was described will be finalized and we would then bring that m.o.u. to you for your consideration of approval and we are expecting to do that at the april 12th meeting. and he just outlined his schedule for then going to the board of supervisors with that m.o.u. and in terms of the legislation, we are anticipating approval of that legislation in the fall, late summer, early fall, and the state lands commission will have an approval and the transaction

will be completed once that is all done and the state law is signed in and we can close on the transaction in about a year from now. next slide, please. that concludes my presentation. we look forward to your comments and questions. thank you, commissioners. >> thank you jamie. thank you, chief. jana, let's open up public comment. >> thank you, president adams. at this time we will open the queue for anyone on the phone who would like to make public comment on item eight b. please dial star three if you wish to make public comment. the system will let you know one the line is open. others will be on mute until the line is open. comments will be limited to three minutes per person.

the cue is now open. please style star three if you wish to make public comment. we do have four callers on the line so i will open the first line now. >> good evening. can you hear me? >> we can hear you. go ahead. >> i am the current president. i am calling in support of the m.o.u. and sale of local 798. we have been working collaboratively with our administration with chief nicholson and deputy o'connor and working with real estate. we also want to emphasize the importance of the facility. as chief nicholson member -- mentioned earlier, the ability

to train were not as effective for those that we serve and it is something that the voters under the easter bond voted to allow us to go forward. and now that we are able to get this location, we are looking for your support to allow us to move forward with this. as i mentioned, we have introduced legislation to move it forward and we are optimistic that this will not only be beneficial, but specifically the bayview hunter's point facility to have a community -- [ indiscernible ] -- hopefully to entice people to move in there. on behalf of the local 798, i ask for your support for the sale of this property to the

real estate apartment in our department. thank you very much. >> thank you. appreciate your comments. next. >> thank you. opening the next line no. >> commissioners, i am the director of environmental justice advocacy. first and foremost, first one wonders, we need an area or a facility that does not adversely impact health. the real estate division has been conducted and environmentally impacted that

report. and in this case, the important thing to do is to get the sample of the style. they are called borings. you don't need to be a rocket scientist to know that a lot of this land is prone to liquefaction. but in 10 or 15 years, it will also be adversely impacted by sea level rise. don't be foolish to go into a contaminated land. we already have a couple of doctors who are testing people in the vicinity. it is called biomonitoring.

first responders are being put in harm's way, on contaminated land, prone to liquefaction and sealevel rise, it warns people not to go near the water. try to figure out this madness that you are discussing about. >> okay. i guess, thank you. go ahead, next caller. >> i would like to remind callers that if you'd like to

make a comment, please dial star three to raise your hand. moving on to the next line. >> can you hear me? >> we can. >> a low. >> yes, we can hear you. >> i am a fire commissioner in san francisco. i am a proponent of this training facility. i think it will be really needed for the future and to keep growing the fire department in san francisco. it is a great opportunity for some of the younger kids in the bayview, and like chief nicholson and chief o'connor talking about creating equity

and diversity in the fire department. we will continue to do that. i am a member of the engineers as well. this would create good union jobs and good construction jobs to keep people working to supplement our apprenticeship program and give opportunities for work for local higher in the bayview. i am a proponent. i think this is much needed. people retiring and to need to fill these spots. when you need to bring in some young blood. god knows what is coming in the future. we need to be prepared. that's all i have to say. thank you for your time, commissioners. >> thank you for your comments. next. >> i have one less caller on the line. i am opening that line no.

>> commissioners, can you hear me? >> yes. go ahead. >> my name is steve. i am the vice president of the san francisco fire commission. and with my colleagues, we support this m.o.u. between the port and the city real estate division. we have so much appreciation that goes to you and the real estate division, but all of the staff that are trying to create this much-needed facility. we have watched the department grow in terms of diversity.

members of the community, people of colour, we have gained the knowledge base and watched san francisco in the last 25 years grow in terms of the building instruction and areas. and san francisco and the city has changed a great deal. all of a sudden know the effects of covid, and also we now -- [ indiscernible ] -- direct service providers in terms of every program that they talk about and in terms of the street, and everything you see in san francisco every day, in terms of what the need is, and in terms of the home's population and mental health. there is no way that i am trying to make a comment that are all the same kind of problems. each one is a definite demand in terms of what service is, and

the department needs to do that. and how we do that is a trading facility. we need to include members of our community throughout san francisco to become inspectors. and we need to do this in a training facility. we are grateful. that agreement is now over. [ indiscernible ] we need to address the issues as we grow and as we try to recover from the pandemic. i appreciate your time. thank you very much. >> any other callers? >> president adams, at this time, there are no other callers

on the line wishing to make public comment. >> public comment is closed. i think i will start with you, senator burke. let's talk about the burton act. this is about you, john burton. anyway, i wanted to say, what do you say? >> you want my comment? >> yes, you are up. >> i just think tom o'connor's comments were absolutely great. tell me where we are having lunch? [ laughter ] >> is that it? [ indiscernible ] >> it is very necessary. firefighter training is old and outdated. they need some modern

facilities. >> okay. thank you, commissioner burton. commissioner gettleman? >> thank you so much for this informational. i am in support of this item and i will be in support when it comes back as an action item. i just had one question. this is curiosity. so, the director of real estate, i was just curious, when the city looks to buy property, private or public, does it always negotiate and buy at formwork it -- fair market value? my question is, you are buying other property to make the deal work. we will be selling our property for market value to go to the fund and help our community and the trust. that is how we have always negotiated. >> thank you for that question. the short answer is, yes.

it has a bit of a nuance. we always do an appraisal before we acquire property. we like to buy property at a little bit below fair market value if we can. we always tried to negotiate the best deal pop is -- possible. we rarely buy property over fair market value. and if you choose to do so, the have to make certain findings that buying property above fair market value is in the best interest of the city. hopefully that answers your question. we did do an appraisal for all people. >> thank you so much. the absolutely answers my question. i appreciated. i also want to say thank you to our firefighters. i never realized that the street response outreach team, the

crisis response team, actually lived underneath the fire department and every day, those teams reached such an impact were having this training centre will help their brothers and sisters who are suffering on the streets. i just want to say thank you. that concludes my comments. >> thank you. commissioner brent? >> jamie, chief nicholson, deputy chief o'connor, thank you so much for this report. this will be a wonderful addition to the community. i guess my questions are around, what is a training facility? is it one building, five buildings? what is the vehicle traffic? what is envisioned at this site? >> thank you, commissioner brandon.

i think i will turn that question over to the fire department, if you could speak to that, please. >> greetings. chief nicholson again. thank you. the last time i was at the port commission -- [ indiscernible ] -- >> just a few weeks removed. >> our current training facility, we view so much up there from firefighting to urban search and rescue, in a pile of rubble. and we have the b.r.t. station that we made for those kinds of drills, ladder throwing drills, driving, all sorts of different props, there will also be different buildings there. one for classrooms and administrations, and another one

likely a tower with seven stories. so we can factor in high-rise stuff. there will be a building for an apparatus and the equipment that we have and we also want to include the administrative building, locker rooms, and facilities for our classrooms, as well as a meeting place that we can use for our programs. and i even fantasized about having someone from the community there to open up -- [ indiscernible ] we really want to be involved in the community. there are lots of different

spots that we will be building. we also use the jaws of life to get people out of vehicles. we also will have the most modern -- we will be able to capture all the water that we utilize at these drills and reuse it. and we will also have it to move through the facility for one you have a firefighting going on there so that it captures the photo toxins and all that. it is a facility that will have a lot of different pieces to it. i am very hopeful and very excited. in terms of traffic, you know, either it will be people that come to train, so there will be

some parking inside, i would imagine, certainly for apparatus. i really don't know how much traffic there will be, but we certainly want to be a regional asset. [please standby]

because i understand from president cal ton that the community uses it in the evening for additional parking and off of alice griffith and o is he we

have been talking about the directing supervisor and designed a project to address some of the concerns about traffic and parking and if i cod just talk about being that good neighbor, and that you referenced, in addition to all of the community engagement that the fire department has, i think the chief mentioned that this would be one of the greenest fire training and since this is a training facility and not a fire station, it's not like there's going to be presence there 24/7 with sirens and lights going on and all day and night that we can anticipate and the chief can correct me if i go a stray, the majority of the training is during the day during business hours and there may be some weekend trainings as

required. we're not looking at this as a 24/7. >> all that works in within it and if i could speak to that as well. if you recall from the map that jamie showed, slide 13, there are two papers streets and bancroft row and griffith off and those paper streets will be upon acquisition vacated and

made part of the project site and haas street are outside of the project area is as arm strong on the other side parallel to carole. it will be improved to a level that would support the facility and it will remain in current conditions for five points of development and arm strong being outside of the project, will remain in its current condition so we will be doing street improvements in order to allow for fire station engine traffic and off on to haas and onto the site. >> thank you. thank you, i'm very supportive of this project and if it looks like the new fire station. >> it's two and a half. >> yes.

>> fire station 35. >> yes. >> fire station 35. it will be a great asset to the community and i think that with all of the activities and all the resources that you are bringing to the site will be wonderful so i am truly supportive of this project and i have an item for new business that i'd like elaine to think about and that is we have a lot of properties south of islis creek and we only hear about it when someone is interested in acquiring it so i would love to see what is within our jurisdiction south of islis creek but i'm supportive of this item. thank you. >> thank you, commissioner. >> thank you, vice president. >> you are on mute, dorene.

sorry. thank you, very much. fire chief deputy chief and andre and jamie for this great report. i learned a lot about the fire department and as i was listening to all the components of what the fire department does, it's very impressive and a in addition to what you need in a training facility and i was just wondering how this site could have accommodate you will of that. obviously you've done a lot of thinking and i guess i'm just going to ask the question, will everything still be covered that you mentioned that you need for training in this site or will you still be using supplementary sites and you mentioned chief nickolson there's more than one building and so, will this also mean the building and i don't know if there's a schematic already in terms of since you already done your environmental review, so is there some sort of architecture rendering of what you envisioned here of how tall the buildings will be and i'm

curious to know because it does seem seven or eight acres is a good site but it's a a lot of things to fit into that facility in a nice way so does it cover all your training needs and what types of buildings will go in so that's my question, number one. >> thank you, voice president. there are no architectural renderings but we've done fit tests to make sure we are put everything on that property that we need so as i alluded to before, there will be a building for administration and as well as lockers and the likes and

there will be a six or seven-storey tower building and a place to store or apparatus so there are several different buildings on there and yes, i believe they will fit and i'm going to turn it over to the director. >> good afternoon, commissioner. thank you for that question. we don't have architecture drawings and we've been working through the department and we're trying to be judicious with our resources so we haven't paid for that but we do have the mitigate deck and it makes some assumptions as to the layout of the facility and i can run through that list for you very quickly. it is the assumed one three-storey which is 50 feet

tall building and one-storey apparatus building and one story maintenance building and a commercial burn room and a sports station and these are maybe not to full scale but again, just mock ups inform. >> toni-marie: assist firefightings and their training. i would also note because of the topography of the area this sits more below trade from alice griffith so even if you have a building that is seven foot

tall, it's still a low rise when viewed by the residents up on the hill. so if you are concerned about border views being obstructed that was taken into consideration. >> also, if could you just tell more in terms of the environmental review. we had a call that mentioned that they're concerned with contamination and lick what faction and i'm assuming that's been addressed. can you tell us how it's been addressed or when you can back for the final action that you give us more details on that so that we can feel good that everything is going to be addressed or recommend deed in the next phase. >> again, thank you for that question and it was an excellent one. there wasn't request done on this site and i think i have the

answer with regards to contamination and i have to get back to you with the answer. there why contaminants found in the soil but nothing you would not expect to find in an industrial site in san francisco. this use is actually sort of lends itself to encapsulation because the fire department doesn't have to go down they go up. we're basically going to be paving the site i would go to look and i don't think the environment, the contamination was a major finding in the mitigate deck and only.

>> i thought someone was trying say something. i just wanted to make sure that as the owner and sellers of the land we pass it on in full disclosure if there are use and i assumed that these things would have been looked into already and just for the record that we do at least mention it and discuss it. >> that's the next point. >> and commissioner, we will be -- we can provide more details at the next action item and as i mentioned, part of the resolution that you will be being asked to approve will include adopting ceqa findings and so there will be those details will be spelled out in the resolution as well and we can also cover as part of the

staff report. >> thank you. >> i'm very supportive and i think it sounds like it would be great for the city of san francisco and we do have an impressive fire department and it would be great for the community. very exciting. i'm just trying to cross all the ts and dot all the is here. >> thank you, commissioner. anything else? >> no. >> i'll just say for me, i'm seeing true leadership on display here today. you have the fire chief nickolson here, the deputy chief, fire commissioners weigh in and the union weigh in and to me it's a united front firefighters are frontline workers, they're real heroes. even before covid-19, they were out there and myself being the

president of the international long shore warehouse i know how important and what the chief is deputy chief is trying to do. there is a new generation of workers that have to uptick their skills. this is heavy lifting and this is something we need to get hyped. because workers, especially union people, things have changed. and i can see the chief's vision and leadership here and taking it forward and the diversity that she's going outside the box. there's no box i can tell with our leadership right now and i really like what i'm seeing now and i tell you, san francisco needs a boost in the arm like this after what we've went through with covid and to know that young people and all kinds of a diversity of people company find good working class jobs. at one time san francisco used to be a working class city and it lost that and so many people

have had to live here, move out of here, so this is so port ants that this thing gets built. we bring the next generation of firefighters and they will take things to the next level and they'll be so much better and i'm really excited about about what this is going to look like and it will add another dimension to our great city we live here in san francisco. chief, thank you so much because i seen people come on and you are leading and i appreciate you and deputy chief o'conner come and the fire commissioners and the union and you are all on the same page and i'm happy you are all rolling in the same direction. you have my support when he comes back. >> thank you so much president adams and commissioners.

much, much appreciated. >> all right. carl next item, please. >> item number 9 is new business. >> i have two items for new business. one is to report on the properties port owned south and discuss strategies for those properties and the second is to come back on our leasing policies and ensure that we have about what we need in terms of financial stability and protection for port in those leasing policies for new tenants. is there other new business? >> commissioners, if there's not any other new business, is there a motion to adjourn. >> so moved. >> i'll second.

>> is there a motion. >> commissioner brandon. >> commissioner gilman. >> yes. >> we are adjourned at 5:48. good meeting. thank you, everybody have a good week. >> thank you. >> see you all in-person. >> yeah. >> good night.

>> if i could have your attention. thank you. the look around the room, it is wonderful to see your faces. it is really a pleasure to see wisdom, strength, bravery and leadership. all of the great attributes for the year of the tiger. [applause] >> thank you for being here. on behalf of the heritage foundation, thank you so much for coming to this afternoon's lunar celebration. i am the board chair of the foundation. the foundation's mission is to

promote awareness of the asian pacific cultural heritage and great opportunities for community collaboration. the main event is a celebration of the apa heritage month in may. you will learn more about that later this afternoon. this seven's event will not be possible without all committee members and volunteers. we also are thank full to the reception sponsor amazon. let's give them all a warm round of applause. thank you so much. [applause] now to start our program i have the great pleasure to introduce san francisco's city administrator carmen chu. i really don't have to say more than that,