Anabigail, the floor is yours. Thank you, chair peskin. Good afternoon. Thank you for considering this item. The designation of this 200 block of stewart to lane serves several purposes as residential use. The new residential building is replacing a sevenstory garage whose entrance was at 75 howard and only address will be impacted as there are no other buildings on this block. This compliments the bike lane on howard, and dropoffs will occur. There are other examples of town that sorry. There are several letters of support in the packet from the neighbors including the stewart Street Hospitality association. This went through the port process under jurisdiction and it passed unanimously at the port on december 10th of 2019. If you have further questions about this item, we are also joined today by Justin Zucker for any technical land use questions and thank you so much for your time this afternoon. My connection timed out and im back. Supervisor, i just ended my remarks. If there are any questions, we have others from Justin Zucker and miss rose to any technical landuse questions, as well as kristine mann. Were supported today by public works and jeremy spitz is on standby. Thank you, abigail. I will note for the record with received a letter of support from the nearby boulevard restaurant which i forwarded to clerk major which will be a part of the record. Are there any comments or questions from supervisor safaye or peskin . Not at this time . Public comment, any members of the public who would like to comment on this item . Mr. Chair, staff is checking to see if there are any calls in cue. Theres one question. Hello, caller, you have two minutes. Please begin now. This is peter dislow. The generaim a member of the eo street. We in support of the remaining of stewart street where an association of members and harbour court, Hotel Griffin and ozomu restaurants and we have no problem with the renaming of that portion. Stewart street would like to also add the cooperation of the developers of the project to this date and the distance concerns of everyone in the area, so were in support of the renaming of that portion of the street. Thank you for your comments. Are there any other members of the public who would like to comment . We have zero questions remaining and well close comment, and if theres no objection, theres a motion to forward this to the full board with positive recommendation and on that motion, a role call, please. Supervisor preston . Aye. Preston aye. Supervisor safaye. Aye. Supervisor pekin. Aye. You have three ay session. Could you please call the next item . Yes, item number two is an ordinance amending the planning code to modify the district regarding minimum parking requirements for ceiling height and to allow payment of the inclusionary housing fee and assert finds. Members should call the number provided on the screen and press one and zero to line up. Thank you, madam clerk and this item was reviewed by the Planning Commission back in january and was originally scheduled for a hearing in front of this committee earlier, but, obviously, it was delayed and needed to be renoticed. This was brought to us by supervisor stephanie and supervisor stephanie, the floor is yours. Thank you for your scheduling this item. This is a special use district that would create 100 new homes in district 2. Im doing everything i can to make sure my district does its fair share to provide homes for families and working people. I think a lot of people do understand the background of this specialuse district and this project. When the project sponsor approached me and asked me to make a change to the original use district and allowed them to say i was less than thrilled is an understatement. I say that because the value of having inclusionary housing on item is important to all of us. This was agreed to under the initial sud and shown with the original conversation, there was ncondition, there was nopath wi. So as it stands right now, the lucky penny or the copper penny project will not be built if i dont make this change. So i want to be clear that the process that brought this project here was not typical. In general, we should be following our citywide Inclusionary Zoning rules when increasing density. However, the site as a special set of circumstances that make it different. The underlying zone itself was a planning mistake. As initially zoned, the height limit would be 80 feet but 21 units allowed. The sud allowed for 100 units of housing, bringing the density in line. This is transit rich and has easy access to the 38 garry bus where our city is investing over 3 million. The project sponsor has also committed to using union labor for the project, ensuring that we will be creating jobs with fair wages and benefits and we all know now we need that more than ever. A long and thorough Community Process brought the surrounding neighborhoods together in support of this project and i have heard concerns that the funds raised through this special use district will not be used to build housing in the immediate vicinity and im working to find locations for projects that are 100 affordable in my district and this would be a welcome addition to making sure that we create housing for people of all income levels in district two. So i wanted to let the committee know that i am working with supervisor fewer to write legislation to hold that 4. 5 million fee while we try to identify a site. I want to thank supervisor fewer and her staff. I would ask that you move this legislation forward to the full board with a positive recommendation as the Committee Report and, of course, remain available for questions and thank you again, chair peskin for scheduling this item today. Colleagues, if we dont have questions for supervisor stephanie, i would like to ask miss Veronica Florez from the department of city planning to make a presentation a. I think this went before the Planning Commission on january 23rd and recommended unanimously to the board of supervisors with one modification that supervisor stephanie has just addressed that, would be the subject of trailing legislation. With that said, miss florez, the floor is yours. Thank you, chair peskin. Thank you. You have shared my presentation, but to reiterate, this relates to the proposed change to the garry masonic district and chill alinwillallow a housing fee. This was heard by the Planning Commission and the Planning Commission recommended approval to earmark the impact fees to district 2. Supervisor stephanie was amenable to the changes and would look into this further and shes also working with the neighboring districts to identify potential sites. This concludes the staff presentation and im available to answer any questions. Thank you. Thank you, miss florez. Are there any questions for veronica . Just for the record, this particular change is specific just to this project, correct . This does not set precedent. I just wanted that on the correct. Yes, correct. This is specific to this project. Thank you. I just wanted to hear the Planning Department say that for the record and i know you know, and i know, as well, but i wanted to hear it from the Planning Department. Veronica florez, that the proposed amendment regarding the option for an includingary housing fee is specifiinclusion. Done through the specialuse district project, correct. Yes, this would be to the living planning code, which we would review the planning projects against. Ok, thank you. Youre welcome. Thank you, chair. Chair, i have a couple of questions, if i may. Supervisor preston. Thank you. Im trying to understand the history here and just my understanding is that the original rezoning or the creation of the special use district was premised on the purpose of that as stated in the ordinance, was to provide mixeduse development, with a combination of income levels at this site. So im a bit concerned with a proposal that essentially removes the Affordable Housing from this site. I am right in my understanding that the special use district that quadrupled this was to allow mixed income on site there . So the original sud revised the zoning to allow much more housing on this site. I believe its 65 or 67 units. So as supervisor stephanie mentioned, the specialuse district increased that number dramatically. And part of the original sud was to include a different set of market rates and inclusionary housing requirements. However, during the Planning Commission hearing after listening to the project sponsor, supervisor stephanies presentation and comments from the general public, the Planning Commission did support the proposed ordinance with the caveat for the recommended modification regarding the collected fees to be designated towards district 2 or the surrounding vicinities. Just for a followup question. Looking act other sites of comparable sides here, we have others that lift the restrictions but the developers there agreed there may issues but they have agreed to all all of the inclusionary on site and im wondering if you could comment on other compraably sized projects. I can speak to two very particular projects. Theres one by the same developer and that was in home sf program and they are providing 25 onsite units and that is for onitem, as well. And iv im still working on anr Housing Development project with around 1167 units and this is located next door, both of which are in supervisor safyays district and theyre voluntarily providing the units on site. So these are just two projects of comparable or larger size that i worked on recently. inaudible . The former lucky penny restaurant has been vacant under underutilized for a number of years and thats one reason why supervisor stephanie said were trying to bring housing in and activate the site and this is one of the ways we would bring momentum back to the project. Thank you. My microphone was muted. My apologies. The one point was going to make is that the entire inclusionary housing regimen incentivized onsite inclusionary, which is why the percentage for onsite is 23 as compared to the in lieu, which is 33 . So there is a disincentive financially to go offsite and that is captured here. The offsite was not an option and frankly, in looking through, at least on paper here, not seeing what makes this site any different to any of the other places where we either insisted on or have voluntarily obtained on site Affordable Housing at a time when we desperately need that, but thats more of a comment than a question. Thank you, supervisor. Shall we go to Public Comment . I believe cyrus, the project sponsor, is on the line but there may be others, as well. They are checking to see if there are any callers in cue. Mr. Chair, no callers wishing to speak. So with that, Public Comment is closed. Mr. Chair, we have veronica, who would like to speak. Miss florez. Thank you, chair peskin. Just one more comment i would like to add in response to supervisor prestons inquiry. After the special use district was set in place and after the recent years, the project sponsor came back to the Planning Department and to supervisor stephanie sharing that the cost estimates came in, about 10 million, above the original estimate. This is largely due to the voluntary measures to higher union labor. So this is based on information from the project sponsor. This is the primary reason why providing onsite affordable housinaffordablehousing and whyd to make the option for an inclusionary housing pee. Fee. Just a quick followup on that, because i want to be careful here, because i think often, the cost of these are unfair of labor and i want to make sure thats not the case here. The ocean avenue site you mentioned, my understanding is that is able to do the 25 onsite and that is fully labor committed site, as well. So im not sure again, i upset the cost o the developer faces and i commend them on commitment but i think to use union labor here, but im still looking for why this is different, again, than Something Like ocean where the 25 affordable is done on site but cant be done here. Chair peskin, can i speak on that since its in my district. Sure. Supervisor preston through the chair, the reason the 65 ocean still pencils and we hope it continues to pencil is because its in one of the Economic Empowerment zones that the federal government created. We were able to get that project fully entitled prior to the end of 2019, when the tax ability for investors essentially, it offsets certain tax liabilities and that is not an option at the lucky penny site and so, the reasons that our project continues to pencil because of that. They are also doing 100 union labor on the ocean avenue project and have committed to that, but its a significant difference in terms of the amount of capital and the amount of offse offset for the cost e project and changes the return for investment for those that are in investing in the overall project. So i think thats probably the most significant between the two. You have the project sponsor on the phone thats doing both projects and he could speak about that, as well. Thank you, supervisor safaye for that piece of information. Cyrus, if you would like to just clarify for the committee and madam clerk, if you can magically patch cyrus in. Good afternoon, and thank you so much for your time this afternoon and i hope you can hear me. Yes, we can. Id like to thank supervisor stephanie and her entire staff and the Land Use Committee for hearing our project today. This process has been ongoing at the laurels since 2014 and i think time is a key element here that has been touched upon but not exclusively. It started off as a project and a parcel that permitted 21 Housing Units. So the density limit on site only allowed 21 units within the existing mass restrictions that are still in place and have not been changed. From the extent of Community Outreach process over the years, over six years at this point, we were able to establish a coalition of support from the immediate neighbors, some of whom are loudly in opposition to another project thats nearby. But were able to create a large consensus of neighbors that delivering housing within the sites current constraints made sense and were able to add housing without any of the underlying zoning constraints. And so that conversation had started well before the discussion of home sf, which when we were about a month or two prior to heading into our original Planning Commission on the issue, was announced and at that time, we approached the neighborneighbors and sought toe home sf. But there was a significant amount of opposition and we were faced with a lawsuit that would never allow the lawsuit to move forward or working within the constraints of removing the density limits and so thats the reason why we could not pursue home sf at the laurel. The significance expect difference between the laurel and the ocean project is that weve been pursuing our approvals and trying to break ground for six years now at the laurel. And through that time frame, weve experienced a pretty significant escalation in construction pricing. The building is a type one project, concrete construction is substantially more expensive than woodframe construction than 65 ocean. 65 ocean, begin that we were able to pursue and with the support of supervisor safaye, we were able to pursue the approval in a much more timely manner which continues to be prioritized as a project through now the plan check and building process, as well. By way of comparison, we submitted a comprehensive Building Permit for the lucky pepnpenny site that we would brk ground. April 15th was our scheduled date and we were informed that the building departments only picked up the permits for review. So the projects really are very different in nature and, unfortunately, theres a lot of variables at play with regards to the conditions at the lucky penny that have necessitated that change in this off sighting. We are committed to deliver housing and committed to deliver Affordable Housing on site. And we have tried to demonstrate that across all of the projects in the city, but this is a matter for the laurel of feasibility whether or not we get any housing and this is different than the ocean project. Thank you for the comments, cyrus. Just out of an abundance of caution, i would like to reopen this up to Public Comment. If there are any members who would like to comment on item number 2, please do so now. Checking to see if there are any callers in cue. Thank you, miss major. Mr. Chair, m no callers wishing to speak. Well close mr. Chair, i just wanted to say forked recore record, the San Francisco building trade called me and let us know that they were 100 in support of this project. I received a similar call, as well. Supervisor preston . Yes, i dont know if this is better directed through the chair to the developer or supervisor stephanie. Im curious if theres been any consideration of how this pencils out if its not all or not. Seems like the claim is being made that it cannot be developed as originally proposed with onsite, but then we have before us an amendment that would allow them to do zero onsite and do everything in lieu. Has there been any consideration of something all or not requiring twothirds, half, some portion of this Affordable Housing to be on site and the rest feed out . Cyrus, would you like to take a shot at that . Please give me a second, please. Sure. I apologize, theres a little bit of a lag. Im assuming its our phone call, but supervisor, preston, weve extensively looked at a number of achieve the returns that would make this project feasible to move forward. Weve been as aggressive as we can be with regards to our revenue assumptions and trying to cut as much as we can on the cost side to hit those threshholds and the proposal in front of you came about after numerou