1. 21 which is way below that capacity that is allowed under the charter. Additionally, as you know, the capital plan also imposes a limitation of not exceeding the 2006 tax rate level, and this maintains that policy. In addition to that weve also included various documents that include the official notice of [speaker not understood], notice of intention to sell, the official statement as well as an appendix a, which is included in the official statement. The official statement is updated through march of this year. We still need to update to reflect the information thats been recently released including the mayors proposed budget, the controllers revenue letter as well as the most recent election results. By approving this youre delegating the authority to the controller and staff to update to reflect that. Due diligence is scheduled for appendix a next week and we have meetings with all three rating agent if. We hope [speaker not understood] lehman market sometime in august. Thank you. Congratulations for getting to this point. No question right now. Well move on to our budget Analyst Report. Yes, mr. Chairman and supervisor mar. On the bottom of page 69 of our report, we report that for the series 2014 c bonds owner with a residence of [speaker not understood] would pay average annual additional property taxes of 12. 54 per year. For the series 2014 d bonds, this is on page 70, the owner of a residence were an assessed value of 500,000 assuming the owner exemption of 7,000 would pay average annual additional property tax to the city of 22. Per year. We recommend you approve the proposed resolutions and ordinances. Okay, thank you, mr. Rose. Supervisor mar . Yeah, i wanted to thank deputy chief [speaker not understood] for being here, former Police Captain from the richmond. I think that the bond will really help with the upgrade through the District Police stations. Also the relocation of the medical examiner facility and the upgrade to the Traffic Company and Forensic Services division. But i just thank you for being here and were appreciative of the voters impacting the bond. Okay. Well open this to Public Comment. Anybody wishing to comment on items 20 through 24 . Seeing none, well close Public Comment. [gavel] i want to thank supervisor mar for his comments and [speaker not understood]. Can i have a motion to approve these item . We can take that without objection. [gavel] madam clerk, can you call item 25, please . Item 25, resolution declaring the intent of the city and county of San Francisco to reimburse certain expenditures from proceeds of future bonded indebtedness; authorizing the director of the Mayors Office of housing and Community Development to submit an application and related documents to the California Debt Limit Allocation Committee to permit the issuance of Residential Mortgage Revenue Bonds in an aggregate Principal Amount not to exceed 375,000,000 for 15001580 Mission Street; authorizing and directing the director to direct the Controllers Office to hold in trust an amount not to exceed 100,000 in accordance with cdlac procedures; authorizing the director to certify to cdlac that the city has on deposit the required amount; authorizing the director to pay an amount equal to such Revenue Bonds; approving, for purposes of the Internal Revenue code of 1986, as amended, the issuance and sale of Residential Mortgage Revenue Bonds by the city in an aggregate Principal Amount not to exceed 375,000,000; authorizing and directing the execution of any documents necessary to implement this resolution; and ratifying and approving any action heretofore taken in connection with the project as defined herein, and the application as defined herein. ~ Mission Street. Okay, thank you. Good morning, supervisors. Joan mcnamara, senior project manager, Mayors Office of housing and Community Development. I just ran 30 blocks. [laughter] the resolution before you is a resolution regarding qualified Mortgage Rates new bonds for 1500 Mission Street. A Residential Housing development sponsored by related california. Although the resolution authorizes the director of mocd to submit an application for the California Debt Limit Allocation Committee for permission to issue maam, why dont we give you one second to catch your breath. Thanks for running over here. We dont want to do harm on a budget item, number 25. [laughter] i think im fine. At your discretion here. Although the resolution authorizes the director of mocd to submit an application to the california debt Allocation Committee to issue such bonds, the primary intent of securing the bonds approval now is to declare the intent of the city and county of San Francisco to reimburse certain costs from proceeds of the future bond indebtedness. Once the project has been fully approved by the city, we will need to return to the board of supervisors for permission to actually issue the bond. Currently, related california is proposing approximately 565 housing units, 80 or 452 units will be market rate and 20 or 113, will be affordable. As with all residential bond issuances, the city will need to comply with City Contracting provisions as well as Standard Loan cd Affordable Housing guidelines for the affordable unit. And im not sure its related not . Okay. So, matt wood of related california is available to answer any questions you have as well as you can answer ask any questions of me. This concludes staff reports. And im so sorry i had to run. No worries. Thank you for being here. Much appreciated. We have no report on 25, right . Okay. No questions at this time. Well open this up to Public Comment. Anybody wish to comment on item number 25 . Seeing none, Public Comment is closed. [gavel] so move approval of the resolution. Okay. We can take it without objection. [gavel] madam clerk, can you call item 26, please . Item number 26, resolution approving an exclusive negotiation agreement and letter of intent with related california urban housing, llc, for the potential city purchase of an Office Building to be developed at 15001580 Mission Street at an estimated Purchase Price of 253,000,000 and authorizing nonrefund amount payments of 1,000,000 toward Land Acquisition costs and up to 250,000 toward Schematic Design costs. ~ Mission Street. Thank you. Thanks for sticking around, mr. Updike. It is my pleasure, chair farrell. Well call your item next time. This item is well worth waiting for. So, greatly appreciate your time on this. We might be one of the longer presentations, but we are a couple of minutes before the lunch break. So, if you dont mind. So, quick overview here. This is a 2. 5 acre site located at van ness and mission and, actually, i believe we need to tee up there we go, thank you. Just currently owned by good will. Our partner in this venture related to california would be the acquiring agent of the property and there would be a subsequent transaction between related and the city. Well get into the transaction details a bit later, but i want to give you the overall context of why the city wants to move forward with this and why this is an important project. Its a partnership. A Public Private partnership, not perhaps the most classic sense, but nonetheless it is a privately delivered project that fulfills the citys space needs well into this coming century. It also is a mixed use development. And mr. Woody will speak to that if a moment as well and why this is important to related. Out of this will will come an Office Building that suits the citys needs a we try to consolidate our presence in the civic center and try to stabilize our cost, but most importantly this provides efficiency of City Operations and provides efficiency of service to our constituents. So, ill speak to that briefly. This is a consolidation of staff out of number of properties, 30 van ness, portions of 1650 mission, portions of 1660 mission, 1680 mission, and 114555 Market Street. This provides proximity to transit. So, its great to have Public Services on this property. As you know, we have a strong foothold on the block at 1 south van ness at the corner of van ness and market that strengthens the foothold of city services. Most importantly it provides a robust onestop permit center that we have long sought in this organization. Its not just dbi and planning. If you can imagine a permit the city issues, it will be issued from this location. Constituents will go to one address and not be shipped around the civic center trying to figure out which office they need to go to. We will service them here. And service them quicker. Additionally with dhr currently located at 1 south van ness, there is a training element as part of the space plan for this location, but also its an opportunity to consolidate our other employee services, retirement and Health Services, creating a onestop City Employee location as well. So, thats the overall strategy that we have been looking to accomplish for many years. We think this is one of those last opportunity sites, so, were excited to be able to present this to you. You know the citys presence in the civic center and where they are located. We do have a desire where possible to move into ownership. This accomplishes that. Ill speak briefly to the transaction after mr. Woody. I want to note that because its a privately delivered project we have a very aggressive timeline. We feel confident were going to be able to meet that timeline. We have a very aggressive pricing. Ill speak to that in a moment as well. Its really because its a [speaker not understood] turnkey project [speaker not understood] upon completion. If i can ask mr. Woody to come up and present you some other details and related perspective, and then ill close. Yes, good afternoon. Im matt woody, partner with related california housing. I want to briefly walk you through the concept that we have developed working collaboratively with john updikes department and also with city planning. This site, as john indicated, is a unique site in the civic center, market octavia district, slightly over 21 2 acre site at least in our search for an opportunity to develop multifamily housing, feel its really one of the most unique or one of the best sites weve come across. Also one to provide a True Partnership between us as a private company and the city. We [speaker not understood] has a long track record of doing very important civic buildings as well as housing, to work with us. And mr. Updikes department. And have come up with a ken except tail plan that has been reviewed with city planning. The site divides the [speaker not understood] in half. The northern and eastern portion of the site basically would become a build to suit for the city of approximately 4 62,000 square feet. Im going to walk you through the initial massing concept for that in a second ~. Importantly, this portion of the site is contiguous to a building that the city already owns. It runs south van ness. So it really is literally and figuratively a consolidation of the city departments. One of the objective of the master plan weve been working on is to give the city a presence on van ness, and also to accommodate a programmatic requirement, very large well played something very hard to do. ~ anywhere in the city, but particularly this part of the town. And at the same time, create a project that would be a good partner or Good Neighbor to the 565 units of residential that we are building on the south and western portion of the site. As this slide shows, one of the fundamental pedestrian objectives of the property was to make it easily accessible for any member of the public or staff that were coming to the building either through mass transit on market and many muni lines that run there or if you were trying to keep the cars off 11th and mission, off of 11th which is a much quieter street. Another objective of the site plan was to enliven the intersection of south van ness and mission which took it away moved it away from the current vehicular oriented, very busy almost freewaylike condition to where it is more pedestrian friendly. Essentially to draw pedestrians down from Market Street to Mission Street, im going to walk you through in a minute, we have the potential to influence that and maybe remake the condition of that very busy intersection, which is pretty much pedestrian unfriendly today, by putting pedestrianoriented retail along the south van ness and Mission Street. Next slide. So, what you see here in blue is the ground floor permit center john was referring to a minute ago, which will have access from van ness from 11th and also from mission, which really i think will open up what is right now a much more difficult function or series of functions to access. And from a birds aye perspective, this gives you an overall configuration of the city, l, pedestrian concourse from south van ness to 11th. ~ birds eye image of that, residential shaped complexion with the tower at south van ness and two wings going up south van ness and mission. And in the middle approximately a half acre landscaped one level up garden space that both the Office Building and the residential units will look into. And this is, again, a very conceptual master plan massing model. It gives you a sense of the scale. What we tried to do here was break up the pieces so that it did not appear as massive as a project of this scale which is approximately a million square feet in total would otherwise look. So, if yall prefer any questions . Supervisor mar. Yeah, i was just going to add that i think its great that department of public works, dbi, planning, they will gradually be moving to that more centralized location to create that triangular spot of where all of many of our city departments have closer access to city hall and the courts. I wanted to ask about the units of housing. I will miss the old good will store and i know thats the central location, but what are the plans for good will for the future . That would be helpful for me. For housing what is estimated to be affordable and or below market rate . So, i mr. Woody to address where we stand now on affordability. I think were coming strong out of the box with the affordable element onsite ~. And we also have jane bond available from the board of good will to answer questions directly. So, at this early conceptual stage we are envisioning 20 of the units being permanently affordable, essentially 8 more than the code requires. And this is an approach that weve taken on other projects weve developed here in the city, including a project of similar scale at mission corporate paramount which we built in the early part of the decade and still own. Im jane [speaker not understood], chair of the board of good will. You asked about our retail site. Actually, that site not only contains our retail store, but our headquarters office. We have warehouse, we do training in our ecommerce. Unfortunately it is too tight. [speaker not understood] that is the reason were selling it because we need to buy, acquire much more modern facility mutt a much larger facility. We use the proceeds [speaker not understood] hopefully with ground floor retail within close proximity to this location. [speaker not understood]. And then we will look for Warehouse Space that is in excess of 100,000 square feet. The proceeds of this sale are very much needed by good will for us to really move forward, expand our mission, we have to have much larger, much more modern facility. Just to put my good will plug in. Everybody thinks its a place to drop off your clothes, the retail store, thats not our mission. Thats just a means to accomplish our mission which is to take the chronically unemployed, former inmate, former drug addicts from poverty to a sustainable job. We can only do that if we expand our business. So, were really invested geting proceeds from this thing. Thank you. Thank you. I just wanted to thank ms. Bond for providing the information about good wills mission and the 1,000 employees and the level of training of no wage and low wage worker to get them some skills for better jobs in the future. In the hundred year history good will has had with San Francisco. I just wanted to adi hope good will workers will be able to afford the new housing thats built and 20 of affordable or below market rate. I guess i have a question of whether that can be increased, especially given the long history with good will so there are more opportunities for the workforce of good will or low wage workers that are trying to rise the economic ladder would have access to stay in the city in a Transit Oriented Development like this. But i think 20 sounds very low to me given the huge needs of housing and lowincome families in this city. I think its fair to say, supervisor mar. [speaker not understood]. Theyre doing the best they can. This is a little complicated, little over 2 acre site. So, every effort is being made and i think thats reflected in the fact were already looking with the prior item to set the stage for as much affordability as possible. So, were going to do everything we can. Right now were at the 20 stage. If you dont mind, chair farrell, ill give you some of the metrics of the transaction and we can move on. Please. And, so, the budget Analyst Report currently articulates both the particulars on who would be occupying this site. This is very preliminary. Were going to have a number of meeting and discussions on exactly how we stack or occupy this facility going forward. The item before you today is a ratification of a explicit negotiating agreement and letter of intent. That is the item thats before you, nothing more than that. That includes [speaker not understood], a classic way of participating in a Public Private partnership agreement, as well an obligation to create up to 250,000 towards Schematic Design. And that will help inform our ability to understand exactly how we best populate this building so that when we return to you and ill outline those returns in a moment, well have much more detail. So, we needed that flexibility to expend some Schematic Designs to move this project forward. As in the report you can see it is estimated this is the citys part of the project. This is for the Office Building, around 253 million. That translates to 52 1 a square foot in delivered space ~. Thats a total hard and soft costs along with the allocation of the land loss. To put that in perspective, 52 1 square foot cost, of a brandnew lead certified building with seismic conditionses that are beyond standard and with day care facility and with open space. So, that 52 1 would be compared to ill give you the last five transactions in the city and county of San Francisco of like buildings in terms of size. 600 a foot, 6 20 a foot, 750 a foot, 725 a foot, 590 a foot. Thats not new building. Thats existing building. We feel this compares favorably with other opportunities in the marketplace. [speaker not understood] the Civic Center Operations are important as well. So, thats the bottom line that the loiena thats before you now. Just want to remind you youre going to see a lot of me between now and the time that the doors open in late 2018. So, well have a number of trips. The next one coming up will be in the fall. Well come to you with the purchase and Sale Agreement. That will be informed by that Schematic Design effort i mentioned. At that point well begin to commit additional fiscally fiscal objectly gaytions, but also begin to move forward with the ceqa process. This is all subject to ceqas completion and analysis of options with respect to develop then well come back to you, youll see it on your [speaker not understood]. That could be in the fall of 15, early 16. After ceqa approval, then we would return for ratification of the purchase and [speaker not understood] agreement. [speaker not understood] as we approach completion of construction and move in late 2018. So, hopefully that schedule helps, give you some context. There are a number of amendments that have been proposed by the budget analyst. We are happy with those amendments and would intend to return this fall with the Additional Information requested in those amendments. Thank you, mr. Updike. Supervisor mar . Yeah, i wanted to just comment to mr. Updike, im realizing also in reading the budget Analyst Report, reviewing it more closely, that it not only department of public works building inspection and planning, but it looks like its also the Retirement Department and Health Service systems that would be consolidated into more centralized location. And given how much the rents have been increasing commercial property im seeing the tremendous benefit to the city for those. I did want to ask, the head of Mayors Office and housing is here. I know the 550 units proposed and 110 below market rate is cited a a goal. And i know that were looking at middle income residence as well. But im wondering if you can comment on the tremendous need for below market rate units and what youre doing to ensure that were going to have enough to that, for example, workers from good will would be able to afford to live in the building they used to work in. Supervisors, olson lee, director of Mayors Office of housing. As director updike mentioned were very early in the process, and the level of affordability specified in these agreements are related to the use of taxes and bonds for the financing of this development. So, these units will be affordable. At no greater than 50 of Median Income. So, theyre going to be relatively affordable. And i presume that the workers of good will would be income eligible for those, those particular units. One of the questions is, you know, are they, in fact, low enough to actually serve those employees. But the base obligation for any new multifamily Development Based upon prop c is 12 . And, so, this is an increase in that air of affordability by 8 percentage points. So, there are going to be over 130 units of Affordable Housing here at 50 of income for which the Mayors Office of Housing Community development is not subsidizing it. And we will actually be the other party responsible for issuing the bonds and monitoring the ongoing affordability and ensuring that the owner is indeed serving, you know, folks at 50 , the Median Income and below. The Mayors Office of housing sees this apart of a larger strategy as we create market rate housing, we are creating indeed Affordable Housing and this is a classic example of that. Is it enough Affordable Housing . Its never enough, and we agree he with the board on that. We are also looking at other ways of trying to create Affordable Housing in other particular sites. As you may know, we have spent a lot of time this summer with the Housing Working Group trying to look at the question of middle Income Housing and what some of the tools might be and where it would be most suitable to do t. We havent found that Magic Program at this point and the source in which to do it, ~ but we are currently looking at a variety of ways to encourage and produce and ensure that there will be a band of Affordable Housing serving that particular middle. This may or may not be the site for it, but clearly the initial allocation of affordable units, the 20 is a significant increase over the baseline requirement for a building of this size. Thank you. Okay. Seeing no other questions, mr. Rose, can we get your report, please . Yes, mr. Chairman and supervisor mar. A budget for the citys total estimated cost to purchase and develop the property and that budget is 253,285,0 80 dollars and that is shown in table 3 on page 78 of our report ~. On page 78 we also note, a mr. Updike ha already stated, that this legislation would authorize nonrefundable payment of the city 1 million toward Land Acquisition costs and up to 250,000 for initial Schematic Design costs. On page 81, we have our recommendations. We recommend that you amend the proposed resolution [speaker not understood] prior to the date the board of supervisors must endorse the purchase and Sale Agreement on october 31st, 2014. And that report should provide details on the space requirements of the city debtsv and the proposed uses such as Training Board room, space for occupying the new Office Building, including long term staffing [speaker not understood], also explain the option