pledge of allegiance . Cell phones, pagers and Electronic Devices are prohibited. Any person responsible for the ringing of any electronic device. A member of the public has up to three minutes to make comments on each agenda item on the supPort Commission on any item. Item 8, Public Comment items notlessenotlisted on the agenda. Any Public Comments . Seeing none, Public Comment is closed. Item 9, public directors report. Good afternoon. Im the support director and first, i would like to update you on the fire station at pier 22 and a half, the expansion project. This will be the ports first floating facility and were excited about this important lifesafety project. We have issued the first of two in a series of Building Permits and Construction Activity is set to start this month. The project should be completed april of 2021. The initial work will consist of demolition of the existing finger pier and fire boat shed behind the historic firehouse and were anticipating a groundbreaking ceremony with oupour partners partner. The first is the American Society of Civil Engineers awa award. They have been elected as the San Francisco section and they will have an awards ceremony in the historic green room at the War Memorial Building and also, weve won the collaborative partners award. This is the Second Annual partners award taking place september 26, 2019. So its exceptional that our project team has won two awards and i would like to congratulate the following people. Twere very, very proud, both of the project and accomplishments. Finally, we have Coastal Cleanup day, a saturday. Please mark your calendars from 9 00 to noon and this year, the port is excited to join mayor breed, the public works department, public Rec Department for statewide cleanup day. We recruit a lot of volunteers to pick up debris. There will be cleanup crews at pier 94 and warm water cove. We are in a friendly competition with oakland this year and we need to pick up more trash than they can get. If you would like to know more for the battle for the bay and please go to the website. So the game is on. Mark your calendar and that concludes my report. Thank you. And congratulations to the engineering team. Is there any Public Comment on the executive directors report . Seeing none, ok. Item on the consent calendar, for members to travel to norfolk, virginia on september 13 to september 16 to attend the American Association of port authorities annual convention. So moved. Second. Is there any Public Comment on the consent calendar . All in favour . Resolution 1934 has been approved. Requesting the agreement with specific cycling incorporated, two california facilities as Foreign Trade 3 subzone for a term of five years with three options, the extent for five years each and outlining the conditions for the operation of the use its driven. Good afternoon, president brando. Im requesting approval of a Foreign Trade zone operators agreement with specific cycle. I want to provide some background on the Foreign TradeZone Programme and the history with the port. Foreign trade zone act was signed into law in 1934 by president Franklin Roosevelt to stimulate trade while mitigating against the nex negative of frao keep economy in the United States. A Foreign Trade zone or ftz, is a designated area considered to be outside of u. S. Commerce, allowing for benefits around duties and tariffs. The programme is administered through the ftz board by grantees like the port of San Francisco. It is important to note that when the programme started, Foreign Trade zones were brick and mortar locations at the port of entry. With the changes in international shipping, such as containerrization, the programme shifted to an alternative site framework. This allows grantees to expands their service area and for private entities to activate an ftz at their own location which no longer needs to be directly connected to a port of entry. The ftz board and u. S. Customs are wholly responsible for compliance and oversight of the operators which allows the grantee such as the port to offer this public utility to all of those that have been vetted by those two approved government agencies. The port of San Francisco was given grantee status for Foreign Trade zone number three in 1948. We were the third Foreign Trade zone in the programme behind new york, which was Foreign Trade zone number one and new orleans, which is Foreign Trade zone number two. The ports Foreign Trade zone originated on one of the ports piers before the change to the alternative change sitework in the early 2 thousands. 2,000s. It was to include five additional bay area counties. The port currently has five active ftz operators and users, all of which are within the expanded service area. Each operator pays the port and annual fee to cover the ports administrative coast. The port has no oversight responsibility on the actual Foreign Trade zone operation. The specific sickishly a global manufacturer and distributer and in january of this year, they reached out to port staff requesting to activate their california Distribution Centre as a Foreign Trade zone. Be its headquartered in madison, wisconsin. They used product and brands to promote an active lifestyle while participating in programmes that donate thousands of bikes to those who may not be able to afford them. The specific cycle imports products and materials to the port of oakland and would use Foreign Trade zone status to benefit from streamline processes associated with the Foreign TradeZone Programme. The support staff held several meetings with u. S. Customs at their vacaville location. Both have approved specific cycle for activation with the grantee which needs commissioner approval. The ports Foreign Trade zone number three falls within the scope of the Strategic Plan by sustaining Economic Vitality in the region and providing a public utility that supports the local maritime industry. Specific cycles Distribution Centres received approval from the two bodies, being the Foreign Trade board zone and u. S. Customs. Staff recommends approving this operators agreement with pacific cycle, allowing them to act as a specific trade zone. Thank you. That concludes my presentation and ill be available for questions. Thank you, a motion . So moved. Second. Is there any Public Comment on this item . Seeing none, Public Comment is closed. Commissioner gilmore . Thank you for your reports details someone who knew nothing about this. I have one question, which is, could we at some point have hundreds of these operators to the trade zone, specifically will whats happening to at the National Level . Could this be a new source of helping folks do this here in the United States . I mean, its built to be a public utility offered to anyone that is approved by u. S. Customs and the Foreign Trade zone board with an actual Business Case to work. And then as the grantee, we can decide if we have a reasonable factor to not allow them to go and do business as a Foreign Trade zone. But to answer your question, we havent seen that many. Maybe i can explain. This is because some imports and they intend to of course port immediately. Its not to, for an import that is for a business consumer in the United States. So if its going to be reexported, theyre trying to simplsimplify the process. The fees in your report is all whats paid in the report. Is that correct . Yes. So that covers overhead. Yes. Weve reviewed many, i think, in the past and seems like its not really lucrative to us but its a god thin good thing for the or and to promote trade. Thank you. Vice president adam. Im supportive. As am i and thank you for this report. All in favour . Resolution 1935 has been approved. Item 12a, informational presentation on the phase one budget, parks plan Management Agreement for the mission work project at 337 founded by china base channel, third street in San Francisco bay. I feel really happy that im the presenter and thank you for letting me do this. The informational item the phase one budget and the parks for mission rock. We anticipate coming back on september 24th for action on these two ims. Items. Back in 2009, 185 allowed fort explore this mixed use neighborhood by relaxing and trusting restrictions on the property and were here ten years on with the first Port Commission action item, which would allow implementation of phase one. Really important milestone for the project and i want to note that we signed the transaction documents in august of 2018. Those transaction documents include the development and dispostion agreement. The phase one budget and parks plan is a part of the transaction documents and its sort of is during the last year work on implementation items including basis of design for the entire site, a number of mapping, permitting utilities, street design types of activitied and those are going through the board and other city agencies, the Port Commission, budget and parks plan are two implementation items. The mission rock site is 28 acres outlined here in this slide. At full buildout over the four phases, we anticipate 2. 7 to 2. 8 gross feet of development, including 1200 Housing Units, 40 below market rate, affordable, a million, a little bit more than a million, up to a million four of office, 240,000 square feet of retail and 240,000 square feet of retail space in pier 48, the overall project design. Phase one is in pink on the righthand side which would include 560 rental units shown kiddy corner, pa parcel a exami, 550 square feet of office delivering the local hire and 20 lbe commitment. Just the 5. 5acre park, i cant stress how much of a major benefit this is, more than twothirds of the open space and parks all delivered sort of on the backs of these four parcels, all in phase one. Looking back at approval, the primary changes that have occurred from what was anticipated at phasing, at approvals is that parcel f was swapped in to swea develop more Housing Units and geotechnical solution, with what was anticipated for the fill site to solve and really mitigate any anticipated settlement was pile supported streets. The now preferred and approved through the city with conditions geotech solution is lightweight cellar concrete. Cellular concrete. How much do these city blocks and 5. 5acre blocks costs . The cost for phase one approved through the budget process in the next meeting is 145 million. The total for phase one is almost 175 million, adding an developer return is up to 265 million. Phase one balances because of the sources that are identified, the first of which is the 42. 2 million in net land revenues, we call them Development Rights payments referring to the four parcels, prepaid 75year leases, also a known number. That number is derived and based upon the appraisals of those sites. The bonded here are the key Public Financing sources and this is issuing community facilities. Its based on the completed plan and building and the row in that charge is the ongoing tax payment not to the debt payment. So we have a balanced one phase budget. The cost that you see in phase one are arrived from a competitive bid process the competitor went through. The port has a thirdparty cost estimator who reviewed those and found them to be reasonable. Thy include china bases and park, resulting in 18 million in hard Cost Increases. Cost cost isoft cost is a couplf factors. This is sort of a typical budgeting procedure. The soft costs have come in higher because we have costs from contractors who provided byes to design some of the work and the second key factor is that phase one has shouldered a lot of sit sitewide design wor. The basis has been done sitewide. The mapping, the tentative map has been done sitewide as the utility systems. The costs for phase one are higher than for approvals and higher as a ratio than subsequent fay phases because of this work that has advanced. I spoke earlier about the 5. 5 acres of parks, eight city blocks and we have a couple of different aspects i want to bring to your attention. First is unique street network. We have what we called shared public ways. These are streets that are designed to slow down traffic and have more pel pet friendling to china basin park and two districtscale sustainability measures and there will be a District Energy system serving the entire site to reduce energy needs through Heat Exchange similar to what they use at thet exploratorium. We have the lightweight concrete, the geotech solution, a lake merit project done recently used in cases to recues settlement because youre reducing heavier soil with the concrete to ensure streets over time arent settling and having the types of any types of problems in this fill circumstance. Also, of course, the 5. 5 acres of parks and open space. This shows sort of just outside of the tabular format how the uses and sources measure up. This is because of the Cost Increases weve seen for construction and we anticipate higher assessed values and thats bad because that drives down land value but its good because we will have more taxes from the buildings to use to support the Public Financing sources. We are getting closer to issuing a bond. Were now months away, we think, from issuing a bond and we can zero in on what we think the Interest Rate will be and they are lower than anticipated at project approvals because at project approvals we had an average bond Interest Rate and now that were getting closer with the office of public finance, we can project the Interest Rate will be lower. Overall returns to the port, interestingly from project approvals have gone down slightly from 198 million at approval to 190 million. This is ow on a net presence bas and you might recall much of the revenue it comes from a variety of source. Some from leases and tax proceeds not needed for the project. Across the four, we project an 8 million decrease in net value terms, primarily driven by the second part of the bar chart. This part of the bar chart, the 58 versus the 40 million is derivederived from lower land v. When we have lower land value, we loan that land value to the project and get repaid from Public Financing sources in the future for that loan and we anticipated that loan at project approval to be 58 million because of decreased land value, we think it will be 40 million. All of these projections will provided with assistance from our thirdparty economic consultants. In conclusion, were looking act the staff report and based on that review and the work with the thirdparty economic consultant, it does balance and we want to note that balance relies on the budget approvals, including a couple of dust items. First the mixedused impact of thiimpact isimportant. We have a subsidy anticipated between 135 to 181 million. This is a unique feature of the project, that they will go together. The developer has proposed and weve agreed, contingent on your approval that 1. 7 million of the entitlement cost is allocated to a future phase at a 0 return. A measure to make sure the budget balances, subject to a future approval for phase 2, 3 or 4. The Port Commission would allow us to repay the entitlement sum, 1. 7 million of the entitlement cost with that cost accruing a 0 return starting last year and this is a good benefit to the port. The last item is that the cfd taxes i mentioned earlier, based upon the higher tax increment, the developer has propose aned d we think its beneficial to increase them on 20 on commenter and 15 on residential. We think the tax increment was conservative and we can now increase the projection based on what we think the billing buildl be assessed at. This is the phase one that we anticipate, once we get into implementation. Its important for us all to be aware as we take these next implementation steps that we are a true partner in the Public Private partnership, that. The development project. Many of items ive mentioned are projectioned. We do have risks around the