Port Commission approves America's Cup leases, CEQA findings and financing to upgrade waterfront venues

The Port of San Francisco Commission on a unanimous vote approved revised California Environmental Quality Act findings, a mitigation monitoring and reporting program and a lease-disposition agreement to make waterfront venues available for the 34th Americas Cup and related events.

Port staff told the Commission the package would allow phased delivery of venues beginning as early as May 2012 and returning sites to the port after the events. Bridal Benson, Special Projects Manager, described the actions as the last set of discretionary approvals for the project and said the agreements are intended to both improve public access and provide long-term value to port facilities. Benson said the port is obligated to pay up to $500,000 for certain repairs to prepare sites for the event.

"The San Francisco Waterfront is a valuable public trust asset of the state," Benson said while framing the project around public trust and maritime, recreational and cultural benefits. Mike Martin, America's Cup project director at the Office of Economic and Workforce Development, said staff are negotiating insurance and security instruments designed to protect the city's general fund and the harbor fund and to secure event performance.

Supporters from the business and labor communities spoke during public comment. Kevin Carroll, executive director of the Hotel Council of San Francisco, urged approval and said large events generate broad spending that benefits small businesses around hotels. Representatives of ILWU locals and yacht clubs told commissioners they back the project and expect local jobs from event-related work.

Port staff also asked the Commission to approve a series of construction and contract amendments tied to the cruise terminal and America's Cup infrastructure, citing changed scope, bid-price trends and newly discovered substructure issues at Pier 29 that require additional work. Kim Von Blahn, Port Project Director for the cruise terminal, said some bid packages came in higher than earlier estimates, and that shifting some work from later phases into Phase I will reduce temporary facility costs.

Finance staff asked the Commission to recommend up to $45 million in city certificates of participation (COPs) to finance the cruise terminal, shore-power at Pier 70 and America's Cup infrastructure needs. Elaine Forbes, deputy director of finance and administration, said combining city COPs with reallocated port capital funds reduces issuance costs and leverages the city's stronger credit profile; she cautioned the financing required defunding or reprioritizing some other port projects in the short term.

Commissioners pressed staff on how defunded projects will be replenished and whether port crews could perform some demolition and dredging work to reduce costs. Staff said some defunding choices were driven by timing and the need to deliver work for the America's Cup, and noted the possibility of revisiting allocations if internal crews or ordinance changes permit doing more work in-house.

The resolutions and contract amendments (identified on the record as Resolutions 12-38, 12-39 and 12-40) were moved, seconded and approved during the meeting. Port staff said remaining permitting and contracting steps remain and that they will return with updates as projects progress.