Transcripts For SFGTV CCII 9115 Commission On Community Investment And Infrastructure 20150909

Thank you madam chair. The first order of business is item no. 1 roll call. Commission members, please respond when i call your name. Commissioner man da har is absented. Commissioner singh. Yes. Commission busto. Yes. Malled m chair gonzales. Commission manned har is absent. All others present. Commissioner 2 a the next regularly scheduled meeting of september 16, 2015. Will be held at 1 p. M. City hall room 416. B announcements of prohibition of sound producing Electronic Devices during the meeting. Please be advised that the ringing of and use of cell phones and pagers and similarly sound producing Electronic Devices are prohibited at this meeting. Please be advised the chair may order the removal from the room for persons responsible for sound producing Electronic Devices. C announcement of time allotment for Public Comment. Please be advised a member of the public has three minutes to make pertinent Public Comments on each agenda item unless the Commission Adopts a shorter period on an item. It is strongly suggested members who wish to address the commission fill out a speaker card and submit that card to the commission secretary. The next order of business is item 3 report on actions taken at a previously closed session meeting if any. There are no reportable actions. The next order of business is item 4. Matters of unfinished business. There are none. The next order of business is item 5. Matters of new business consisting of consent and regular agenda. First the Consent Agenda. 5a. Approval of minutes for the regular meeting of july 7, 2015. Madam chair. Yes, thank you. Do we have any speaker cards for this item . I do not have any speaker cards. Okay. Commissioners, we have minutes of inaudible . Thank you. Commissioner singh moved. Sec. Commissioner busto seconded. Please call the roll. Commission members please announce your vote when i call your name. Commissioner mandahar is absent. Commissioner singh. Yes. Commissioner busto. Yes. Madam chair asalz. Yes. I have three ayes and one absent. Okay. The Consent Agenda is adopted. Please call the next item. The next order of business is regular agenda. 5b. Adopting environmental findings pursuant to the California Environmental quality act. And authorizing the dpektive director to accept the navys tender of parcels d 2, uc 1 and uc 2 of the highest point naval shipyard. And authorizing the Fourth Amendment of the income lease with hps development company. Lp, Cp Development company. Lp, Hunters Point shipyard. Redevelopment project area. Discussion and action, resolution no. 542015. Madam chair. Madam director, im sorry. Thank you madam secretary. Good afternoon to the commissioners and good afternoon to the members of the public. Thank you so very much for joining us. Commissioners, the item for your consideration today really is a product of decades of work and it truly is a potentially a momentous consideration if you approve this action today, which is the transfer of property at Hunters Point shipyard. Its been well over a decade since the last transfer was approved. Since that time weve engaged in a process with several regulatory agencies the navy and other third party and redundant reviews as done by the San Francisco department of Public Health as well as our independent environmental consultant lang tread low willow to ensure the property here before you, which is about 14 acres, which form the backbone of the infrastructure for the land plan thats been vetted and approved and approved by the voters really is the spring board for the balance of the development as well as early seating from innovation corridor. Weve taken all due appropriate due diligence. And now are ready before you for you to consider these actions. So with that id like to ask han zen drew whos the Hunters Point candle stick point senior. And shell also drew other members of the team here as well. Thank you executive director bohi. Thank you gonzales and other members of the commission. Id like to thank members joining us today. Including doris, vincent and marry booker. We are also joined by amy from the San Francisco development of Public Health and christina lane of our independent contractor environmental consultant. Lain tread will and low low. We are joined by patrician mcfad p from the u. S. Department of navy. Jackie lane from the United States Environmental Protection agency. They are the lead Environmental Agency on the clean up. And we are also joined by sue hail hoe da from urban Master Development partner. To provide a quick overview as we all know in 1974, the United States navy closed operations at the shipyard. The shipyard was then placed on the comprehensive Environmental Response compensation and Liability Act circa in 1989. The federal facilities agreement was enter into between the navy and the regulatory agencies in 1992. This agreement allowed the clean up work at the shipyard to begin. And then in 2004 the conveyance agreement was entered into between the navy and Redevelopment Agency now ocii. Also in 2004 the navy transferred the first hill top and hillside along the first phase of development to the Redevelopment Agency. And now for the First Time Since then the three additional parcels uc1, uc2, and d2 are ready for transfer. So in terms of the agenda, my presentation, im going to provide some background olt parcels that are now ready for transfer and go from the steps required to go to the conveyance as well as give overview documents required to execute the transfer finally overview of next. indecipherable . Sorry. Yes. Slow down a little. Ill slow down. [chuckling]. Trying to get in under my 20 minutes. So to provide some background on the parcels, uc1, uc2 and d2, here they are in context of the development. You have candle stick here along with the shipyard. And on the left side of the screen is the transfer schedule for the parcels as you can see a and a 1 have already been completed and the future conveyance schedule is listed there as well. The into the shipyard side of the development project, here in red, yellow, and orange are the three parcels that are ready for transfer. Specifically looking at parcel d2, this parcel is comprised of approximately six acres. It includes building 813 currently. And it will be developed in the future into commercial development specifically research and development uses. Next parcel is uc1. Which is comprised of four acres. Uc stands for utility corridor. Sto that means its currently roads and infrastructure thats used on the shipyard. And its use is similarly commercial development, research and development. And finally we have parcel uc2. This is 4acre site, which is similarly a utility corridor kurnltly comprised of roads and infrastructure. It will be developed into mixed use including community facilities, specifically a part of the future artists studio building will be developed on parcel uc2. And it will additionally include some residential properties. The parties to the transfer are of course the United States department of the navy. Theyre the current land owner of all the parcels on the shipyard with the exception of parcel a, which was transferred in 2004. The u. S. Navy is responsible for all the Environmental Remediation thats happening out at the site. The office of Community Investment and infrastructure is another party to the transfer. We currently own portions of parcel a. Should this be approved, well become owners of uc 1, uc 2, and d 2. And then our Development Partner will develop the land they receive from ocii through the process outlined in phase 2 position and development agreement. Additional folks who are parties to the transfer are the regulatory agencies. Those include the lead agency, the u. S. Environmental protection agency, and in addition to the California Department of toxic substances and control also known as dtsc. Also Regional Water Quality Control board. Their responsibilities are to approve ceqa nn and then after transfer they do have ongoing monitoring and enforcement responsibilities. Other involved agencies include the California Department of health. And of course our own San Francisco department of Public Health. The San Francisco dph reviews and comments all remediation documents and reports leading up to the transfer. And then they do have continued oversight after transfer through article 31. This is my favorite slide, which i have stolen from the department of Public Health, which demonstrates just how iterative the process of conveyance leading up to the clean up is. The arrows represent the various ceqa decisions that must be approved in advance of conveyance and also show opportunities for Public Comment and discussions with the regulatory agencies. Brings that diagram out and parking it, there are these are the documents that are really fundamental to the conveyance. So, as i already went over, the fall facilities agreement and the conveyance agreement, the ceqa final remedial design which includes the land use control remedial design, remedial action completion report and this all leads up to finding of suitability to transfer. After transfer, the covenant to restrict use of property or indecipherable xp and Risk Management plan are critical documents. Going into more detail about which regarding these documents the federal facilities agreement was entered into in 1992. The parties to that agreement are the navy and regulatory agencies. And this document established the framework for the schedule developing, implementing, and monitoring the appropriate remediation actions that are required in accordance with ceqa as well as other appropriate state and federal laws. These ceqa documents that are overseen that are part of this process include the record of decision, which identifies the clean up method that the navy will use. The final remediation design, which includes the land use control remedial design. And that document describes the clean up method that will be implemented at that point thats actually just created that is shared with the public before any work begins. The remedial action itself is the work that is performed by the navy in accordance with the remedial design, which leads up to a completion report. The remedial action completion report or racr. This document describes the clean up axtivities. Review and provide comment on this report and the navy is required to address any concerns the have. And then transfer or sof outlines clean up that will transfer with the property. This document must be reviewed and agreed to by the regulatory agencies. inaudible . The conveyance agreement the parties to that are the former Redevelopment Agency now ocii and the navy. This agreement sets a specific clean up standard that the navy must comply with per the Hunters Point Shipyard Redevelopment plan. And it requires the navy meet those clean up standards in advance of offering the parties to ocii for acceptance. The conveyance, which is in front of you today, has three conditions to it. The first is that the navy must determine the planned development will not present a risk to human health or safety and that the property has been remediated to the level described in the conveyance agreement. Second, the regulatory agencies must conquer with the navys determination that the parts were suitable to transfer. And lastly the navys quitclaim deeds must be consistent with agreement and acceptable form to oci smed. So to walk through each of those, the first is that the navy must determine that the planned development does not present a risk to human health or safety. And that the property has been remediated to the levels we all previously agreed to. The navy makes that determination through the fost finding of suitability to there have. Fost was issued in 2012 and parcels for uc 1 and uc 2, the fost wassished in march 2015. Concur with the navys ready to transfer. They do this through a concurrence. For parcel d 2, the regulators published their concurrence in 2012. And for uc 1 and uc 2, the navy concurred with the forest in 2015. The last code and condition is navy quitclaim deeds must be in acceptable form to okci itched. Reviewed krit claim deeds for all three parcels and we have found them in conveyance with the. So after transfer, there are certain functions that are put in place to ensure that the parcels are handled in a way that is protective of health and safety. And the first of those is through the department of Public Health. And article 31 authority. That permits the San Francisco department of Public Health to review all permits for consistency and compliance that the regulatory controls. Ask they continue to monitor and force these regulations during building. Actually sig toir to permit closeout before any occupancy of development on the 14eu7 yard. There are also land owner responsibilities, which ill go over in detail. And those are to first comply with the covenant and deep restrictions. Those two have the same requirements. So im just going to go into the krup. But note that the Deed Restrictions mirror whats required by the krup. And also future land owners must comply with the Risk Management plan for development activities. After transfer, the navy does still have continuing responsibilities. First they are responsible for any clean up thats required after transfer. So should any unforeseen or unanticipated spots become noticed, the navy would be called in to do a remedial action on those. Theyre also required to continue, maintain, monitor and report on ground water dispp and finally for future parcels, which isnt applicable to the parcels in front of you today, theyre required to perform shoreline protection. And continue to monitor engineered caps on shoreline parks and the land itself. So more details on that covenant to restrict use of property. This is a restriction that will come with exclusively parcels uc 1 and 2 and not d2. The responsible parties for this are the future land owners. And its overseen and implemented by the California Department of toxic substances and control. California dtsc, who is one of those ssa sig toirs. The krup is incorporated by reference into the deed and obligates fiewrnlg land owners to certain tasks that safety. Require future land owners not to grow edible vegetables in native soil. Use the ground water, or do activities that stir up the durable cover or any monitoring rules. In addition in designated areas, future development will be occupancy of future development will be restricted unless those new developments are designed in a way to mitigate for soil vapors. And finally, future owners are required to annually inspect and report on compliance with these restrictions. Inspect, maintain, and repair the durable cover in accordance with the maintenance plan. Theres also a Risk Management plan. The future parties to that are the future land owners. And it applies to parcels again, uc1 and uc2 but not parcel d2. This document requires regulatory agencies certain. On the property. If these protocols arent followed. If the activities would fall outside that rnp, then the developer would be responsible for seeking approval of a separate work plan. So the activities are permitted under the rnb are excavation and grading of area less than one acre. Excavate right of away for repair and maintenance of underground utilities. The demolition of hard scape hard scape would be the durable cover. If it is removed, it must be reinstalled. And lastly Horizontal Development has been improved, then vertical development may proceed. So a key to ocii in moving forward with this transfer is a Fourth Amendment to the interim lease which is also in front of you for your consideration. The interim lease is an agreement between ocii and our Development Partners that defines Property Management responsibilities to them. This amendment will additionally assign Land Management responsibilities to comply with these regulatory requirements for future land owners, including of course compliance with the krup and Deed Restrictions. The developer would be responsible to on ocii behalf conduct annual inspection reports and provide any payment of fees due to dtsc or the regulators and additionally our Development Partner would be responsible for the durable cover, maintenance and repair. So in terms of next steps, we will be working to complete the transfer of the parcels with your approval today. And well additionally endeavor to execute the Fourth Amendment to the interim lease of the developer. In terms of upcoming transfers, next anticipate transfer of parcels g, b1 and ir 17. And then in 2017, we are looking forward to the transfer of parcels d2, and uc 3. I would also like to make a quit note that the numbers of phrases in the result clause of the resolution thats in front of you today, that pertain to the Environmental Review, we would like to revise the numbering for clarity. So the final form will change slightly from the version thats in front of you today. Its not a substantive edit. Its just a renumbering for to provide c clarity. And with that i ask the folks here today are available to answer your questions. Thank you. Do we have any speaker cards . Yes, we do. Doris. Norman. And oscar. Can you please come forward . Good afternoon, commissioner. My name is doris stenson. And i find that the documents in front of you has addressed all of our concerns about the transfer, and im hoping that you will approve and pass this today. Thank you. Commissioners, director rosales. Counsel. I can only echo what miss stinson said. We are all here. We are hoping today that you will move on this item so we can continue to move forward. And we came all the way we have a little more road to travel. So were hoping that you will pass this so we can be continuing to go ahead and get this big job at the shipyard and everything over with. And so, indecipherable questions. Im not a environmentalist or anything, but hopefully have answered all the questions. Were ready to continue on with the cleaning effort and get to the part where we get to the vertical development on the ships yard. Thank you so much. Doing such a wonderful job. Thank you. Good afternoon. Oscar james. I can see it every time i come. Hunters point. And one of the first ones who served on Hunters Point shipyard under the honorable joseph when they closed the shipyard in 70. When i served in 73. They closed in 74. But im in favor of this particular project, but i do have problems with and i know its going to be coming up pretty soon. C and d 2. I want that 100 clean. But this particular project, i support it 100 . And i was one of the first ones to bring it to the mayors attention. Also the navys attention that the shipyard had been polluted. Thank you very much. But i am in supportive this. Thank you. Es pe doe la jackson. Good afternoon. Good afternoon. Will you please. Down to 235. Ready . Im ready. I want you to go to the last page and see what it says on the last page. The conclusion. That conclusion was down to leiveth. 2011. And you need to go on your computer and get the file number thats on what i just given to you. Because its a 37page packet. And i refuse to give any more of my paper out, because you all take up donation from me for me to buy my paper. You know. We have a large problem in bay view Hunters Point. You know, people dying. And we had set up a task force a couple of months ago to have all the regulatory agencies come and be a part of whats happening in bay view Hunters Point. The deaths that are occurring. And when you hear and see 20 people dying within a 2month period, someone needs to be concerned about whats going on in bay view Hunters Point. And what the sad part is is that most of the people that are making these decisions dont live in bay view Hunters Point. And what i would like for you all to do, because this is granted to you some years ago, is that this commission come out to the community and let the Community Know exactly what you are doing. Ive asked this before. You can meet 1800 oak deal and the picture. That would be a good place for you all to come and listen to the people that live there and whos going through all of these turmoils there in our community. I dont want you all just to be a rubber stamp for something because it sound good. We have to know that it is good, and its good for the people. And whether because we, you know we have a lot of mental problems going on out there now than we ever had before. And its because of what we are breathing. And a lot of you dont know if one get inside your body how long youre going to live. But i hope you read the information about indecipherable . It is not clean. The navy told me that theres no way that they can clean that shipyard. Thats what was said to me. Why . Because of the landfill and Everything Else there. He said if they took everything out of it, it would be bare again. So when i hear you cant clean it, you know . The toxic steel in the dirt. That let me know you all shouldnt be supporting anything to be built over there for the health of the people. Thank you. Thank you. indecipherable . Any others who want to comment on this item . Okay. Public comment is closed. Commissioners, weve had several workshops on this topic. You have any questions . Yeah. I want to talk about the indecipherable . I want to see what their opinions are about this. Commissioners. My name is amy brownell from the San Francisco Health Department. I just want to know indecipherable . Yes, it is. Weve been monitoring and serving and going to meetings and reading reports for 23 years on all of this information. So weve tracked it all this time for all of this work starting with way back when we were working on parcel a and continuing on these other parcels. And yes everything that the navy had needed to do they have done for these current parcels parcel d 2, uc1 and uc2. And were continuing on the next ones. Were already in the transfer thats going to happen next year and all this finding suitability to transfer has documented the navys work and then the regulatory agencies wrote their concurrence letters for those three regulatory aghtszs the usda, department of toxic substance control and the Regional Water quality board have all concurred on fost. Obviously im just one person, so i have a whole team of folks with the independent consultant lang wen tread well and low low who have looked at all the details for various technical decisions that had to be made, and they also support the work that has been done and the transfer of the parcel. Okay. Thank you. Thank you. Commissioner, any questions . I dont have a question. I just may basically have somewhat of a statement regarding. This is a big build. Historic build for us. As we look to this transfer. You know, i know theres been many sides to this long struggle, story, and, you know, i hear dr. Jackson, some of the folks on her work that has talked about the health and safety of the parcel. Heard from people in the Community Say you can finally you know, were going to build and were going to build this area and do whats right by it. You know, i am support of of this, but i think that dr. Jackson brings up some concerns. And this may not be the body to do more research. We may need to go to the Health Commission and talk to them about some of the issues that dr. Jackson and many people in the area who have been expressing whether it be folks dying of a certain disease or Mental Illness that we dont ignore that reality and that maybe, you know, we work with other city departments to take a look at whats happening. So maybe colleague from Public Health can help us through that. But i dont want it to go unnoticed and dont want it to go ignored. Because there are issues. At the end of the day, you know, the city theres still some things in our city that are not clean. And because we built over landfill throughout our city, i think the only people who have this clean was the lownies and native proars and sisters who lived here. They got to take advantage of a very clean area. We dont have that benefit. The alternative is we dont do anything and it doesnt get cleaned up at all. I think with technology, as things move forward with technology, things will get better. And we have the assurance by the navy that, with that advancement of technology that, if theres things that are found they can come back and clean it up. And i think we need to hold them accountable to do that. Because if they didnt do it right this goaround and they can did it as far as they were able based on their own tool and is technology. We further down the line need to make sure they do it right with even further technology that maybe we cannot comprehend may happen. But the road to Clean Communities is going to be long. And so, with that, you know, i support this to move this along. But i also hope that we could maybe you could help us set something up with the department of health to look at some of the issues that dr. Jackson had been bringing up for a while. Because its not just a former redevelopment issue; its a city issue. One of our communities is suffering, we need to to take a look at that. But thats all. Okay. Couple of questions. Just following up on that, i agree that weve heard from dr. Jackson and others this issue of, you know, people dying to be frank about it. This is what she says. And weve heard this. But i dont know that ive heard any response to that particular issue. I mean, has that been looked at . Is this and im not sure if everyone if the incidents that are being talked about are happening in the in a short period of time. If theres more information, maybe you can tell us. Again, amy from the Health Department. I can just give you a very general answer. And then if you need specific answers, i have to get in touch with the head at the Health Department. The Health Department has many initiatives. Were wellaware of disparities in africanamerican health. Thats one of the main initiatives we address. We have lots of different programs and areas that we support. We investigate healthy housing issues like mold and pests and air quality indoor. Theres restaurant inspectors in Environmental Health to make sure all the restaurant food is safe. We have multiple programs that are targeted for the whole city and for that hunters bay view Hunters Point area. Since this isnt the agenda item for today, we can come back and explain all that. I have plenty of folks at the Health Department the director, of course, and dr. Tomas aragon will be happy to address these issues. And its always an ongoing learning process. And theres always more to be done. And its, you know, priorities, funding and all that kind of thing. But do i hear you saying theres no cause and effect . Im not you know, the contamination or lack of appropriate clean up i guess would be the way to describe it. The work that has been done by the navy and the regulatory agencies overseeing at the shipyard itself, we do not they have certified all these years is that the issues of contamination at the shipyard are not impacting the neighboring community. We have air monitoring. We have soil monitoring. We have all sorts of data that has proven that over time. And then the finding suitability to transfer is the marker where they say, okay, we definitely for these areas weve fennished it. And it is okay to transfer. Theyve looked at the adjacent areas. So theres work ongoing as it should be for the adjacent areas. And theyre going to find that that is not going to impact the current im sorry, future residents or tenants or any of those folks. So yes, i agree that the contamination issues that the shipyard are not impacting the neighborhood. But im fully recognizing the first part of my answer that there are problems in the neighborhood that the Health Department does address. Okay. Thank you. Thank you. The only other question i have is just im interested in this portion of the proving that we have in front of us. Looks to me that in 2011 the San Francisco superior Court Granted a writ again, the Redevelopment Agency among others. The board of supervisors. What happened, i guess would be my questwould be my question. Can anyone tell us what happened with this matter . If i may, chad, commissioners. In 2011, 2010 there was a comprehensive approval. This commission gave entitlements as well as planning. Six departments in the city. The board of supervisors enacted. There was a comprehensive Environmental Review document as required under se qa nn and there was documentation dr. Jackson alluded to. As a result of that at that time there was contemplation of early transfer for development that is, it is not a situation we have under consideration today where the properties are fully remediated for their intended use. However, back in 2010 there was a contemplation that prior to accepting the property, there would be the potential and we studied it in environmental documents, in project to potentially take property prior to its full remediation by the navy and certification under that f oost and other process as mr. Ber knell and miss drew outlined. As a result of the lawsuit if we were to consider it again early transfer it would have to be a whole new Environmental Review under se qa nn. So it is not the subject of your actions today, but any future actions should this commission and parties agree to move forward in that way, there would be additional review as required under this writ. Okay. Thank you. Okay. So do we have further comments . Motion . Exploring this kind of situation. And you know i think i am pleased that everything is okay. And i move that item. Thank you. Been moved by commissioner sting. Commissioner biews sos. Can you please call the roll. Commissioner can you please announce your name when i call your name. Commissioner manned har is absent. Commissioner sin. Yes. Commission biew sew. Yes. I have three ayes and one absence. The item is adopted. Thank you. Please call the next item. The next item is item 5c and 5d related to thier baa binah gardens chb acted together but heard separately. 5c conditionally authorizing the First Amendment to the commercial retail lease for the west cafe inier baa buena llc a California Limited Liability company to extend the term of the lease for ten years with one 5year option to extend. Former Yerba Buena Center predevelopment project area discussion and action resolution no. 55, 2015. And 5d condition bli. East cafe in yerba buena gardens which provisions llc, a delaware limited Liability Company doing business as Box Food Company to extend the term of the lease for ten years with one 5year option to extend. Former Yerba Buena Center redevelopment project area discussion and action resolution no. 57, 2015. Madam director. Thank you mad 78 secretary. Commissioners, these next set of actions related to these leases in yerba buena are seminal really in their own way, but really putting the focus on Small Business and the ability of former Redevelopment Agency and the commission to really help Small Businesses grow, thrive not just stabilize, but grow and stay in San Francisco. And it is seminal in the sense this is another nearly a decade the former commission entered into agreements these two businesses and were here again to enter into to request the authorization to enter into another set of 10year leases for these very important thriving Small Businesses. Marie munson Senior Real Estate Development Specialist in our Real Estate Division is here. And i also see the owners of box foods and some of our here as well. Anxiously waiting for your consideration. So with that thank you director foley. Commissioners cisco and spinning marie munson senior Development Specialist. You have before you conditional. Commercial retail leases for two cafe spaces located in yerba buena gardens. I will make one presentation on the two amendments which will then be considered separately. Without these First Amendments, the existing leases for the cafe spaces expire in 2016. The First Amendments would extend the lease terms for the xaf fais for ten years and provide an option for a one 5year extension period. Key provisions included in the First Amendments are the rental amounts for the 10year extension period. Definitions for tenant improvements and the credit for tenant improvements if they are completed. The amendments will also include miscellaneous provisions. You can call it at this point. Cii proposes the First Amendments to the leases in order to continue the operations and management of the cafe. The amendments will avoid potential vacancies of the cafe spaces. In addition able to secure a continuing revenue stream from the leases which use for capital imriew. S of the yerba buena garden. Amortize Capital Improvements which are specified in the leases. Oci real estate include two small cafe spaces located at the gardens on the gardens Upper Terrace above the Martin Luther king memorial fountain. The west xaf fai and east cafe spaces were constructed in 1993. The west cafe is about 2,000 square root and the east cafe is about 2100 square feet. Both spaces have continuous patio space with exclusive access by the tenants. Since 2006, the west cafe space has been occupied by sam rp lounge and since 2006 the east cafe has been occupied by the b restaurant and bar. For the technical difficulties. You can see the space for the cafe spaces. Fourth street and up above the fountain. Okay. Challenges of the cafe spaces. Although the upper floor locations afford expansive use of the gardens and city it results in the lack of disability and street level access, complicated finding and low pedestrian access. Moscone Center Expansion which could further hinder cafe access because the stairway leading to the cafe could be closed during construction. Further construction could be built and a potential loss of business for the tenant. Because of their location, the cafe spaces are considered secondary retail spaces and their market value is negatively affected. In fact, prior tenants were not able to establish Business Models. Of note from 19932003 the west cafe was leased to starbucks, which didnt render its lease because it failed to establish a Business Model. Cloud restaurant and creole cafe both of this did not farewell and ultimately closed. Here you can see in this image the location of the safe and how the path leading up to them winds around. And in fact, the spaces are almost higher than the secondfloor location. You can see at the turn in those walkways, theyre aboveground. The tenants have evolved their Business Models over the past ten years by close proximity to Moscone Center and developing a regular clientele. Occasionally buyout of cafes are not a typical Business Model for a small cafe. However, this model has helped the Financial Performance of the cafes despite the many challenges of the spaces. Under redevelopment dissolution law, ocsi must dispose of its assets including the cafe spaces and leases under the Property Management plan. Under the plan the yerba buena gardens including the two cafe spaces and leases are supposed to be transferred to the city for governmental use. The gardens cannot be transferred until dof approves the pmp. The dlf continues to review pmp. Preserve and manage the cafe. As initial steps to extending the leases you shoulder under the amendments, ocii San Francisco real estate based economic fimple to and recommend lease terms based on market data. Common evaluated Market Conditions for the retail spaces in yerba buena and areas as well as San Francisco market as whole acon reviewed 20 comparable leases and interviewed brokers active in the yerba buena area. Aconfound that the average asking rent for ground floor lease is 58 per square feet. Asking rent for street level with highest foot traffic are as high as 80 per square feet. As opposed to the rents for the most challenging locations on the second or third levels with low foot traffic such as the cafe spaces are as low as 30 per square feet per year. The rents differential between spaces in decipherable locations, primary spaces at street level with highest lines of foot traffic and those in challenging locations can be up to 50 . Acome concluded that the market rent is negatively affected by their less desirable upper floor locations. The current 2015 rents for the cafes are within market range based on comparable existing retail leases for the area and the characteristics of the spaces. The 2015 rent for the west cafe is 44 per square feet per year. And the 2015 rent for the east cafe is 42 per square feet per year. Acom recommended one 10year extension term and one 5year renewal option based on several factors the overall challenges associated with the location, access and disability of the spaces, the history of tenant turn i dont ever since 1993. The tenant demonstrated track record and the tenant planned improvements in capital investment. Okay. So acom recommended adjusting the rent to the market rent at the time of renewal. At 2016 rents that is a 3 increase over 2015 rent. And 3 increases in each succeeding year. In regular in addition of tenant improvement expenditures, acom recommended a first year rent adjustment equivalent to four months rent which would be amortized over 12 months. Acom also recommended that the rent for the first year of the renewal period be adjusted to the market rate at the time of renewal. Which is anticipated to be 2026. Based on acom recommendation, ocii has negotiated with both cafe tenants on the terms for the First Amendments. First ill present the key terms for the and then the key terms for the east cafe the b restaurant and bar. And then finally ill summarize the terms for both amendments. These lounge Serve International food with organic key pairings. Okay. So the terms for the sa ma bar are one 10year term which would begin on march 1, 2016. One 5year extension that is optioned which would go to. The unadjusted for year one would be 88,550 or 32. 50 per square feet. The adjusted rent would be 59,000 or 21. 20 per square feet which reflects credit for tenant improvement again, equivalent to four months and amortized over the year. In year 2 the rent would no longer be adjusted for tenant improvements and the rents would be increased 3 per year. Sama bars tenant improvements estimated to cost 50,000 will include outdoor furniture, heaters, and glass wind screens as well as griew. S. Sama bar will pay for the improvements with their own funds. If improvements are not made, rent credit will not be made. Sama bar complies with ocii policy. In 2014 sama bar employed over 214 employees. Currently over 20 are San Francisco residents. Prevailing wage requirements for the upcoming tenant improvements. And for the east cafe which is the b restaurant and bar it serves farm to table american cuisine and cocktail. Amendment terms are one 10year term beginning june first 2016. One 5year extension that if optioned would end on may 31st 2015. The unadjusted rent for. 43. 26 per square feet per year. The adjusted year 1 rent would be 60,440 reflecting a credit of four months amortized over a year. In year two the rent would no longer be adjusted and the rent would increase 3 per year. The b restaurant tenant improvements which are estimated to cost. You work with us . My name is kar. I am consultant for econ. So the leases that we looked at were a variety of leases in the downtown. Example, you know. Unfortunately, because these leases, i was a lot of it was confidential information, i cant say the exact location of the leases. Couple of out of 20 . Im sorry. It was something that was which is confidential information that i thought we were available to access. But unfortunately, i cant. Maybe. Perhaps chair kelly, if you would discuss your methodology. What was the trade area you looked at from a geographic point of view. Attachment to. What do you go through the methodology at top of the range . And then put into contact these secondfloor low visibility spaces. Absolutely. So we started off by analyzing the entire city of San Francisco. So we looked historically. And mostly the average rates, but also the average asking rates. And then we zoomed in for yerba buena specifically. And we looked at, again, the average rate and the trends over the past over the past few years. Thank you. And then we also so we looked at that kind of in terms of general rents. But then as a secondary analysis cross checking, we did look at this differentiation between high traffic primary spaces and more secondary spaces that are considered more in a more secondfloor location that suffered from the lack of pedestrian traffic. So we also looked at the differential between those two spaces, which we found at about 50 . And imen, we crosschecked it from the greater city of San Francisco as well as yerba buena garden area specifically. And due to the kind of smaller nature of thier baa nah we we also did look at the greater Downtown Market area. It does have similar characteristic with employment which contributes towards indecipherable . We focused in on between those two methodologies. And then the third component was looking at the specific location for and the attributes of the real estate. The visibility, the access, and the pedestrian traffic were the main considerations. What kind of Capital Improvement youre going to . Im going to call up jesse and kevin, the owners, to give more specifics on their Capital Improvements. Okay. So Capital Improvement has been ongoing. Its something that has allowed us to be successful there ten years. Thats frankly speaking why were still there, because we constantly reinvest in the space. Specifically, the walkin which is a sizable investment for us. All new kitchen equipment. The most noticeable and the most expensive is the glass partition on the patio. So this is a 6foot high glass. One barrier that goes around the patio structure itself will become a permanent part of that patio. In response to the outdoor patio, the idea is to make it a downtown area thats accessible by night. Right now its dark, cold windy exposed to the elements. Making it a glass enclosed area would make it dry and heated without making a structure around it. Thats the largest capital outlay. On top of that is furniture, facilities inside constant upkeep. On a slow day we can get 100 people. On a day with convention 1,000 people could overall wear and tear. Weve done our best to maintain it. And were going to do our best to maintain it. Actually have a very we have indecipherable . And, you know, first june i want that vision should be good for them, but rent is not enough. At the same time, i will not go for that 15year lease, because too long. We are not going to be here. Even three mayors will be changed. I think people who come to, you know, after us they should have some kind of say in the lease. Go for just five years at this time. I have a question. Ive actually been to your restaurant really enjoy it. Question is you know, staff was talking about some of the limitations of that space being high up and, you know, theres been a lot of change over around. Is it even i mean, do you actually do well . Because there seems to have been so many negative points about the location and with the construction of the Moscone Center. There were a lot of things that were brought up as negatives. Is it even worth it to even want to stay there . Because it seems like theres a lot of negatives versus positive. For me definitely its worth it. For us we serve two other locations in the city. And its like a flagship being in the center of the city. I would say the challenge is dealing with the fluctuation of business and staffing it and providing reliable jobs to folks who come in. And it could be empty for several days literally twiddling their thumbs and then surge of convention. So for me exposure to San Franciscos international and being in the literally cross hairs of an International City is great exposure for me. It impacts my other locations as well. Definite inherent challenges in creating a destination business thats not reliant on just foot traffic. And thats taken, i would say we are barely beginning to recoup the investment over the past years especially with the construction coming that im excited about the future, which is why were eager for a longterm lease in that its been a very long road to here. And having built it up. But i feel were really at an inflection point. Im an optimist. Being an entrepreneur, have to be. But its a vision to the future is where im excited about. The only thing i would like to add to that is, you ask whether were its good enough for us again, its hoping whats to come. If youd ask me this question after year 5, i would have told you no. But weve modified the way we operate this business this restaurant specifically. I dont operate this restaurant like any other restaurant. As jesse said, we hire i have 18 employees of which ten are fulltime and have been with me over five years. You know, monday, tuesday, wednesday when theres no convention, and we do 35 covers for lunch, that doesnt get it. But then thursday, friday, it spikes it is worth it. So were trying to balance that. And thats why the glass partition is so important for us to try to make a happy hour or Evening Service there viable. But thats why were asking for the extended term. Last year i finished my mba program, and one of the things they say in mba course is that the worst business is restaurant. Its just the toughest, thats why. And i think that you need that sense of stability. I know were asking for that in the mission with some of the longterm businesses that have been there for decades as they renew their lease of stability okay, you have a certain number of years. You can invest. You could plan and thats important. Well, i just im glad you say that. Thats the reason we ask for ten years. We realize as operators in that restaurant that the glass partition is important for us. But the ticket price of over 60,000, its going to take us many many years to recoup that with our margins seeing three or four cents on the dollar. So yeah. Thank you for answering this question. Okay. So i have a big question. Id like to hear about your marketing plans. You know, how you draw i mean, i know this area, and i if youve been in business ten years and youre able to sustain it, you have to applaud you, because it is a very difficult spot to get to. So you naturally would want to draw folks in, right . You got the advantage of Moscone Center convention. I just want to understand are you members of San Francisco travel . You know, are you do you have regular meetings with the folks who know about the Hotel Business . For us i think we have good relationships with the concierges of the hotels. Weve done regular events. Weve done happy hours dedicated just to them. San francisco Visitors Convention bureau. I would say truly the best marketing comes from word of mouth a lot of noise out there. The founders of yelp, twitter, Hoover Square are regular customers. Having them come and tweet something out to their 3 million followers is the best marking possible. Both of us have thousands of yelp reviews. Speaks to the destination factor. Neither of our business are commodities. Its not walkby traffic. Thats why starbucks didnt make it. Thats why its taken years to build up that effect. The second is training. Training our employees to then teach employees all about tea culture and hosting events around that provide really cool opportunities to teach customers something. Which again learning and experience and having an educational experience is the best marketing possible. Ill go out and teach my friends about cullty vars origins. Weve done things where weve had farmers in doing live tastings with customers. We use every channel possible. Not the traditional advertising ones. But members of the yerba buena ie license local organization and then using technology in the best way. Email marketing and twitter were good at that. Social media side of it as well. And collaboration or coordination with the yerba buena gardens festivals, activities . Definitely. That would be continual. Museums around. Definitely. We just had a meeting probably six weeks ago with the whole all the museums were down there talking about how to elevate the perception of the entire area and have for example a round robin hit up various museums in a happy hour, tea taste ping. Everyone can benefit from collaborative market dollars. Listening public is on the radio. Biggest thing was to work to make to parlay yerba buena garnsd as a destination. And ive seen success trying to trying to be part of that definition. So when people come to the gardens whether tourists or locals, they come to the gardens and we really try to sell them on the idea youre going to have dinner here or lunch here. Go to the other side of the gardens go bowling or go ice skating. Theres a Music Festival next sunday. Come in and have brunch and go listen to the music. Thats especially the last four years weve worked really hard to try to be part of yerba buena so thats the draw. One stop destination museum, kids, entertainment, meal, drink. Excellent. Okay. I guess to commissioner sinks point about the length of the term and maybe you can give us an explanation of the recommendation. I mean, i understand the 10year term, but maybe the option is just exercisable by the city or . Ill let marie munson describe how the option works. But john updike and ms. Munson articulated the citys position. It is important for the city to have a longterm tenant through the transition process of the entirety of the yerba buena gardens. And this 10year lease with the 5year option is what the city wants. And its very supportive of it. I just was trying to reach john. He has unfortunately another commitment that he cant change with the Mayors Office staff. But very very supportive. We wouldnt have brought you these two leases for your consideration with these terms with the rent as proposed in the very challenging locations and for this term if we werent moving forward together. So again, i have reiteration from john updike right now yes, theyre extremely supportive and do want these leases to move forward. Theyre cognizant were in this transition phase, which is why its structured in a way that provides us stability for the gardens. Because were coming on 22 years just for these spaces and longer for the balance of the gardens. So there are going to be larger frankly Capital Needs that the gardens reserves cant meet. And if theres a gap here, were just adding to the deficit and adding to the burden frankly of the city, which they do not want. So i add to that with the dre expressing that interest. Also in the market study, it found that there was a range of 510 years, but most of it was 10 years. And because of the challenge of this site you know, the consultant recommended the ten years. And in terms of the extension beyond that, all parties have to agree to that. Right. Is it initially you know, is it at the option well, everyone has to agree. So even if the tenants wanted, the city could say no. Exactly. So its not a matter of right. Actually, i am very very familiar with that area. Theres Moscone Center, yerba buena. You know, upscale. But everybody know theres a restaurant there, you know . And the rent is actually is very good for them, you know . I want to help them. But is it not actually 10years and 15years too long . You know, i dont know whether they have studied that. Whether they have studied all the leases. Im very very familiar in that area. And its very good rent. And i think it will go for 5years if im still there and youre there, come back. Otherwise we dont want people who succeed us, after us they should have something to s say. Okay. Any other comments or motions . I mean, id like to move this resolution. Okay. Prepared to second it . Second the motion . So we can please call the vote . And i think were taking them separately. Yes. So first 5c. Mmhmm. So this is the agenda item 5c. Commission members please announce your vote when i call your name. Commissioner monoda har is absent today. Commissioner singh no. Commissioner busa. Yes. Madam chair. Yes. I have two ayes, one nay, and one absent. Okay. So given that rules majority prevail so that resolution is adopted. Do i have a motion on 5d. Move. Second. Its been moved by commissioner miewns and seconded by gonzales. Commissioner monoda har is absent. Commissioner singh. No. Commissioner biew sews. Yes. Madam chair. Yes. I have two ayes, one nay, one absent. Okay. 5d also is approved. Good luck. We will probably see you some time there. I think its a good idea for us to visit thank you. Okay. Can you please call the next item. The next item is 5e amending the personnel policy to add provisions concerning reinstatement rights of former employees, discussion and action, resolution no. 57 f h 2015. Madam director. Thank you madam secretary. Commissioners, as you recall, recently adopted a personnel policy change to apply certain reinstatement rights to former employees who were unrepresented. And so, now this particular action unifies it and applies that reinstatement right to all employees. So with that brief introduction, id like to ask monica davis, who is our new Human Resources Administration Services manager. Her new to walk you through the specific terms. Good afternoon. Madam chair gonzales and commissioner. Thank you madam director. Just to expand a little bit on what executive director mentioned. As you know on june 16, 2015 commissioner adopted resolution 402015 expanded reinstatement rights for former unrepresented employees who instate with ocii. Said rights stated that unrepresented employees shall have the right to accrue vacation based on their years at ocii. This resolution also provided that unrepresented reinstated City Employees had the right to restore any unused approved sick leave they may have had upon separation of ocii or Redevelopment Agency. The resolution before you today expands those rights to all employees reinstated excuse me, represented who reinstate with ocii. As you may recall during the initial resolution in june, the union reps trying to consider this provision for their representative employees. Since that time, oci hr division and the representatives have conferred regarding this amendment to the policy. And they are in agreement with these provisions as representing attachment a. You may notice a lot of different red lines in the document, but substantively its the same resolution, but we find some things for clarity and consistency of thought. So i hope that please let me know if you have any questions. That is the gist of my presentation. Okay. Thank you. Great, thank you. Do we have any speaker c cards . No speakers. Do members of the commission have any questions . I think it makes sense. I think pretty much everything. Move to approve. Okay. Commissioner buso says made a motion. And seconded by commissioner. Commissioners please announce vote. Man da har is absent. Sing. Madam chair. I have three ayes and one absent. Okay. And that amendment is adopted. Okay. So please call the next item. The next order of business is item 6. Public comment on nonagenda ie tell tems. Madam chair. Do we have any speaker cards from the public . I do not have any speaker cards. Any member of the public like to address the commission on Public Comment . No . Okay. No Public Comment. Please call the next item. The next order of business is item 7, reporter chair. I do not have a report. Thank you. The next order of business is item 8 reporter executive director. Madam director. I dont have a report. The next order of business is item 9 commissioner questions and matters. Madam chair. Do my fellow commissioners have question or matter they would like to raise at this time . No. No . The only thing is just maybe we can end this meeting im not sure if you did it before on in the memory of commissioner osa dee. We did. We did the last. And i believe her Memorial Service will be the 19th. Saturday. Yeah. Okay. Next item. The next order of business is item 10 closed session. There is none. And the next order of business is item 11 adjournment. Madam chair. The meeting is adjourned at 2 32. [end of session] today we are going to talk about fire safety. We are here at the urban center on Mission Street in San Francisco. Its a wonderful display. A little house in the urban Center Exhibition center that shows what its like in a home in San Francisco after an earthquake. One of the major issues that we are going to face after earthquakes are fire hazard. We are happy to have the fire marshall join us today. Thank you. My pleasure. We talk about the San Francisco earthquake that was a fire that mostly devastated the city. How do we avoid that kind of problem. How can we reduce fire hazard . The construction was a lot different. We dont expect what we had then. We want to make sure with the gas heaters that the gas is shut off. If you shut it off you are going to have no hot water or heat. Be careful not to shut it off unless you smell gas. Absolutely because once you do shut it off you should have the Utility Company come in and turn it back on. Here is a mock up of a gas hear the on a house. Where would we find the gas meter . It should be in your garage. Everyone should be familiar with where the gas meter is. One of the tools is a wrench, a crescent wrench. Yes. The crescent wrench is good and this is a perfect example of how to have it so you can loosen it up and use it when you need it. Okay. Lets go inside to talk about fire safety. Many of the issues here relate to fire, for example, we have a little Smoke Detector and i see you brought one here, a Carbon Monoxide Smoke Detector. This is a combination of smoke and Carbon Monoxide detector. They are required in single homes now and in apartment buildings. If Gas Appliance is not burning properly this will alert you before the fumes buildup and will affect you negatively. This is a Battery Powered . This is a Battery Powered and it has a 10 year battery life. A lot of times you may have one or the other. If you put in just a Carbon Monoxide detector, its important to have one of these too. Every house should have a fire extinguisher, yes. One thing people expect to do when the power goes out after an earthquake about using candles. What would you recommend . If you have a battery operated candle would be better to use. This kind of a candle, you wouldnt want it in an area where it can cause a fire or aftershock that it doesnt rollover. You definitely want to have this in a noncombustible surface. Now, here we have our stove. After a significant earthquake we expect that we may have gas disrupted and so without gas in your home, how are you going to cook . Well, i wouldnt recommend cooking inside of the house. You have to go outside and use a portable stove or something else. So it wouldnt be safe to use your fireplace to cook . Not at first. You should check it by a professional first. Outside should be a safe place to cook as long as you stay away from buildings and doors and windows. Yes. That will be fine. Here we have some alternative cooking areas. You can barbecue and if you have a regular propane bark could barbecue. Thank you for joining us. And thanks for this terrific space that you have in this exhibition space and thanks for helping San Francisco stay safe. Good morning today is september 8, 20 freen. Welcome to San Francisco transporeitation authority. Our clerk today is steve stamos and todays meeting is brought to us by leo[inaudible] and charles crim nack. Like to mention my other Committee Members who are here. Commissioner kim and malia cohen and well be joined by mp