108-16606-002                                                                                Agenda Item No. 3 ( a & b )

September 6, 2006                                                                            Meeting of October 3, 2006

MEMORANDUM

TO:                 Agency Commissioners

FROM:           Marcia Rosen, Executive Director

SUBJECT:     Authorizing an Owner Participation Agreement with Alfred McAfee, for the proposed development located at 4132 Third Street, at the intersection of Third Street and Innes Avenue (Assessor’s Block 5260, Lots 002 and 003); Bayview Industrial Triangle Redevelopment Project Area.

Conditionally approving a schematic design for the proposed development located at 4132 Third Street at the intersection of Third Street and Innes Avenue (Assessor’s Block 5260, Lots 002 and 003);  Bayview Industrial Triangle Redevelopment Project Area.

EXECUTIVE SUMMARY 

At the request of Agency staff, through the Executive Director, the Commission unanimously voted at its September 19, 2006 meeting to continue this proposed Owner Participation Agreement (“OPA”) and its schematic design approval to the next Redevelopment Agency Commission meeting on October 3, 2006.

The 4132 Third Street property, containing approximately 5,465 square feet of land, is located at the northeast corner of Third Street and Innes Avenue in the Bayview Industrial Triangle Redevelopment Project Area (“Project Area”). The property is comprised of two legal, assessor’s lots and is currently unimproved.  Alfred McAfee (“Owner”) has submitted an application for a lot line adjustment through the City’s Department of Public Works / Bureau of Street Use & Mapping (“DPW/BSM”) to merge these two existing lots into one developable parcel (the “Site”).  Thereafter, the Owner proposes to construct on the Site a condominium development consisting of a four-story wood-frame mixed-use building, containing seven, three-story townhouses over a ground floor garage area along side a commercial unit (the “Development”).

The Bayview Industrial Triangle Redevelopment Plan (the “Plan”) designates this Site as light industrial or commercial, with residential uses allowed above ground floor commercial uses.  The Owner is seeking approval of an OPA to construct a new, four-story mixed-use building containing a total area of approximately 14,755 square feet.  The ground floor will be occupied by approximately 1,837 square feet of commercial space, approximately 2,603 square feet of garage area with parking for seven cars (including one accessible space) and two bicycle spaces, and also lobby areas (with an elevator access) which shall provide access to the residential units above.  The residential units shall consist of seven, three-story townhouses, with designated open spaces for all units as required under the Plan, and which all are accessed from the podium level.

Six of the residential units will be sold as condominiums at market rate prices. And, although this Development is not subject to the affordable housing objectives of the Agency’s Housing Participation Policy (“AHPP”), the Owner has volunteered to designate one of the seven units as an affordable housing unit.  This unit will be subject to the affordability standards of the AHPP; however, the marketing obligations will be reduced in consideration of the small size of this project.  The Owner plans to retain the retail / commercial space on the ground floor.  The Development will also include the rebuilding of the surrounding sidewalks and the planting of street trees adjacent to the streets fronting the Development.  The Owner is not seeking any Agency financial assistance or any variances to zoning that would benefit his development.  Also, the Developer has voluntarily agreed to participate in the Agency's small business enterprise, construction workforce, and prevailing wage programs.

The Owner is also seeking approval of a proposed schematic design for the proposed Development.  Staff has reviewed the schematic design for the proposed Development and finds it acceptable subject to the conditions of approval described below.  Staff has determined that, pursuant to California Environmental Quality Act (“CEQA”) Guidelines Section 15332, the Development is categorically exempt from CEQA review as an infill development that will not result in significant environmental impacts or expansion of utilities to service the project.

The Owner presented the proposed Development at numerous subcommittees of the Bayview Hunters Point Project Area Committee (“PAC”) in February and March of 2006, and the Development was endorsed by the full PAC on March 16, 2006.

Staff recommends the approval of the Owner Participation Agreement, and conditional approval of the schematic design.

DISCUSSION

Project Summary

￭    The Development ‒ The Site is approximately 5,465 square feet of unimproved land area that consists of two adjacent assessor’s lots (Lots 002 and 003 of Assessor’s Block 5260).  The Owner is currently processing a Lot Line Adjustment application through the City’s Department of Public Works / Bureau of Streets Use & Mapping, to merge these two lots into one developable parcel.  The Owner proposes to construct a new, four-story mixed-use building of approximately 14,755 square feet.  The ground floor will be occupied by approximately 1,837 square feet of commercial space, approximately 2,683 square feet of residential garage area with parking for seven cars (including one accessible space) and two bicycle spaces, and also lobby areas (with an elevator access) which shall provide access to all of the residential units above.  The residential units shall consist of seven, three-story townhouses, with designated private, open spaces for all units as required under the Plan, all of which all are accessed from the podium level.  Six of the residential townhouse units will be sold as condominiums at market rate prices and one townhouse will be designated as an affordable housing unit, at the request of the Owner.  This unit will be subject to the affordability standards of the AHPP; however, the marketing obligations will be reduced in consideration of the small size of this project.  Four of the units will average 1,510 square feet in floor area, and will have three bedrooms and 2.5 bathrooms (with each having its own private open space averaging 223 square feet).  The other three townhouses will average approximately 1,398 square feet in floor area, and each will have two bedrooms and two bathrooms (with each having its own private open space of approximately 67 square feet).  The Owner will retain the retail / commercial space on the ground floor.  The Development will also include the rebuilding of the surrounding sidewalks and the planting of street trees on those portions of Innes Avenue and Third Street which front the Development. 

￭    Permitted Land Use and Plan Compliance ‒ The Plan designates this site as light industrial or commercial, with residential uses allowed above ground floor commercial uses.  The Bayview Industrial Triangle Design for Development (the “Design for Development”) permits a maximum floor area ratio of 4:1, which allows for a building with a density of 30,000 square feet and a maximum height of 65 feet.  The proposed Development meets the density and height requirements and includes the minimum number of off-street residential parking spaces and bicycle spaces.  Due to the small amount of floor area in the commercial unit, the Plan does not require any commercial parking spaces in this proposed Development.

￭    Schematic Design ‒ The Owner’s architect has submitted schematic design drawings of the Development; however, more detailed drawings need to be developed and submitted that indicate the specific detailed design of the elements for the facade, including the balconies and the proposed exterior lighting in front of the building and in the open space areas, together with the articulation of proposed materials.  The architect must also:  (1) provide detailed drawings of the exterior graphics with glass mosaic tiles; and (2) show that all projections over the sidewalk have met applicable City Code requirements.  Also, detailed landscape drawings for all private and common open space areas, together with actual samples of all proposed exterior materials and colors, must be submitted for the Agency’s review and approval.  Additionally, all exterior signs for the commercial space need to be pre-approved by Agency prior to filing for a permit with the City’s Department of Building Inspection.

￭    Environmental Review ‒Agency staff has determined that the proposed Development is categorically exempt from CEQA environmental review pursuant to CEQA Guidelines Section 15332, “Infill Development.”  The proposed Development is characterized as an in-fill development meeting the following conditions:  (1) the proposed Development is consistent with the applicable general plan designation and all applicable general plan policies and zoning designations and regulations; (2) the proposed Development occurs within city limits on a project site of no more than five acres substantially surrounded by urban uses; (3) the Site has no value as habitat for endangered, rare or threatened species; (4) approval of the proposed Development would not result in any significant effects relating to traffic, noise, air quality, or water quality; and (5) the Development can be adequately served by all required utilities and public services.

     ￭    Community Input ‒While no formal community advisory body exists for the Bayview Industrial Triangle, the Agency consults with the PAC, as appropriate, on matters related to the Bayview Industrial Triangle Project Area.  The Owner presented the proposed Development at the PAC subcommittee meetings in February and March of 2006.  The full PAC unanimously endorsed the proposed Development on March 16, 2006.

Proposed OPA Terms and Condition

The following briefly outlines key provisions of the proposed OPA:

￭    Applicability of the Agency’s Housing Participation Policy (“AHPP”) ‒ While this Development is not subject to the AHPP, the Owner has voluntarily offered to designate one of the two-bedroom townhouse units as affordable.  Therefore in accordance with the AHPP, one of these units will be available to households earning up to 100% of area median income (currently $72,950 for two persons).  The affordable unit will be offered through an outreach and lottery system pursuant to comparable procedures established in the AHPP, with Agency certificate holders receiving first preference. 

￭    Small Business Enterprise ("SBE") Program, Construction Workforce Program and Prevailing Wage Provisions – The Developer has voluntarily agreed to comply with the Agency's Small Business Enterprise Program and will make good-faith efforts to achieve the goals of the Agency's SBE Program.  In addition, the Developer has voluntarily agreed to comply with the Agency's construction workforce program and the Agency’s prevailing wage provisions for all construction work done in conjunction with the project.

￭    Lot Line Adjustment  The Owner is currently processing a Lot Line Adjustment application through the City’s Department of Public Works / Bureau of Streets Use & Mapping (“DPW/BSM”), to merge these two lots into one developable parcel.  The proposed OPA is conditioned upon the lot line adjustment being approved.  Even though the proposed OPA may be approved by the Redevelopment Commission, it will not be recorded until after the lot line adjustment has been approved and recorded by DPW/BSM.

￭     Schedule of Performance – Although the Developer expects to commence construction in early 2007 with completion in fall 2008, the OPA provides for the following key outside performance dates:

Originated by Albert J. Luis, Senior Development Specialist,

and Saiful Abedin, Staff Architect

Marcia Rosen

Executive Director

Attachments:    

1. 4132 Third Street Vicinity Maps
2. 4132 Third Street Floor Plans
3. 4132 Third Street Illustrative Renderings, view from Third Street and Innes Avenue

RESOLUTION NO. 124-2006

AUTHORIZING AN OWNER PARTICIPATION AGREEMENT WITH ALFRED MCAFEE, FOR THE PROPOSED DEVELOPMENT LOCATED AT 4132 THIRD STREET, AT THE INTERSECTION OF THIRD STREET AND INNES AVENUE (ASSESSOR’S BLOCK 5260, LOTS 002 AND 003); BAYVIEW INDUSTRIAL TRIANGLE REDEVELOPMENT PROJECT AREA

BASIS FOR RESOLUTION

1. Alfred McAfee (the "Owner"), owns approximately 5,465 square feet of land located at 4132 Third Street (the "Site") in the Bayview Industrial Triangle Redevelopment Project Area (the "Project Area ").  The Site is at the intersection of Third Street and Innes Avenue.

1. The Owner proposes to construct on the Site a condominium development consisting of a four-story wood-frame mixed-use building, containing seven, three-story townhouses over a ground floor garage area along side a commercial unit (the “Development”).

1. The Bayview Industrial Triangle Redevelopment Plan (the “Plan”) designates the Site as light industrial or commercial, with residential uses allowed above ground floor commercial uses.  The Bayview Industrial Triangle Design for Development (the “Design for Development”) imposes certain development standards on the Site.

1. The proposed Development complies with the requirements of the Plan and the Design for Development.

1. The Owner and Developer have agreed to comply with the Agency’s small business enterprise, construction workforce, and permanent workforce programs for the Development.

1. The proposed Development is categorically exempt from California Environmental Quality Act (CEQA) environmental review pursuant to CEQA Guidelines Section 15332, as an infill development that will not result in significant environmental impacts or expansion of utilities to service the project demolition of a single-family residence. 

1. The Plan provides for owners to participate in the redevelopment of private property in the Project Area.  This Owner wishes to participate and to enter into an Owner Participation Agreement.

RESOLUTION

ACCORDINGLY, IT IS RESOLVED by the Redevelopment Agency of the City and County of San Francisco that the Executive Director is authorized to execute an Owner Participation Agreement and related documents with Alfred McAfee for the proposed development at 4132 Third Street, located at the intersection of Third Street and Innes Avenue (Assessor’s Block 5260, Lots 002 and 003); in the Bayview Industrial Triangle Redevelopment Project Area, substantially in the form lodged with the Agency General Counsel.

APPROVED AS TO FORM:

James B. Morales

Agency General Counsel

September 27, 2006                                                                       Agenda Item No. 4 ( b )

101-6606-002                                                                               Meeting of October 3, 2006

MEMORANDUM

TO:                  Agency Commissioners

FROM:            Marcia Rosen

                        Executive Director

SUBJECT:       Authorizing execution of a Memorandum of Agreement with the Service Employees International Union (SEIU) Local 790 Bargaining Unit, for the period of October 1, 2006 through June 30, 2009

EXECUTIVE SUMMARY

The Service Employees International Union (SEIU), Local 790, represents a bargaining unit of miscellaneous, non-management employees of the Agency.  The Agency first recognized Local 790 as the employee representative of this unit in 1969, when the union was known as SEIU, Local 400.  In July 2003, the Agency Commission approved a three year contract with this bargaining unit for a period ending June 30, 2006.  In 2004, the Agency Commission approved a first amendment to this contract.  Starting in June 2006, the Agency and Local 790 negotiated new contract provisions and recently reached tentative agreements.  The proposed agreements include the following new provisions:  a three year term ending on June 30, 2009; salary increases that match increases for City and County of San Francisco (“City”) employees represented by Local 790;  authorization for paid overtime employees to cash-out a maximum of 80 hours of compensatory time (if they have accrued any) on an annual basis; renegotiation of retirement benefits if and when City employees receive enhanced retirement benefits that the voters approve and that exceed the Agency’s retirement program; and a commitment by the Agency to review the existing status of two classifications exempt from paid overtime requirements.  In other respects, the new agreement extends the terms and conditions of the existing contract. 

Staff recommends approval of the Memoranda of Agreement with the bargaining unit represented by the SEIU Local 790.

DISCUSSION

The Redevelopment Agency establishes the essential terms and conditions of employment for its workers through the Agency’s Personnel Policy, the Agency Resolution establishing classifications of positions and compensation (“Salary Resolution”), and memoranda of agreement with four bargaining units that are represented by unions.  (In addition, federal and state labor laws govern personnel practices at the Agency.)  Any changes to Agency policies and contracts are subject to Commission approval.  Although the Personnel Policy and Salary Resolution apply to all Agency employees, the labor agreements apply only to those employees whose job classifications fall within one of the four bargaining units.  The action before the Commission is the consideration of approval of the agreement that Agency staff and Local 790 has negotiated.

Of the Agency’s 107 permanent employee positions, approximately 43 (or 40 percent of the entire workforce) are members of the Local 790 Bargaining Unit.  Local 790 has represented a group of miscellaneous, non-management employees of the Agency since 1969, when the union was known as SEIU, Local 400.

In 2003, the Agency entered into a three year contract with the Local 790 Unit.  The parties reopened this contract in 2004 for the purpose of renegotiating salaries, which the Agency Commission approved in September 2004.  In June 2006, the Agency’s negotiator and the Local 790 Unit initiated negotiations to draft a new contract.  After several negotiating sessions over two months, the parties reached agreement on new terms for a memorandum of agreement (“MOA”) that the Commission is now considering.  The new provisions in the MOA match the provisions in the contract covering comparable City employees represented by Local 790.[1] 

The new provisions of the MOA cover the following subjects:

1.         SALARIES.

Over the next three years, employees in the Local 790 Unit will receive the same salary increases as the City employees represented by Local 790, although the timing of the increases for Agency and City employees is different.  Agency employees in the Local 790 Unit will receive the following increases to their base salaries:  2.5 percent on January 1, 2007; 2 percent on June 30, 2008; and 3.75 percent on January 1, 2009.   (By contrast, the City’s Local 790 employees will receive 2.5 percent on December 30, 2006; 2 percent on April 5, 2008; and 3.75 percent on April 4, 2009.)  In addition, the Agency proposes to continue paying the employee’s 7 percent contribution to the retirement fund, the California Public Employees’ Retirement System (CalPERS).  This is comparable to the City-Local 790 Agreement in which the City agreed to pick up the employee’s contributions to the City retirement program, which is different than the CalPERS program.

2.         OVERTIME PAY.

a)  Cash-out of Compensatory Time Off.  Under federal and state law, employers must pay certain employees “overtime” at a rate of time and one-half for each hour in excess of eight (8) hours in any day or in excess of forty (40) hours in any week.  (In general, employees who are in executive, professional, and administrative positions are exempt from these paid overtime requirements.) The Agency has several job classifications that constitute paid overtime positions (“P”classifications).  All of these positions are in the Local 790 Bargaining Unit. 

Under the existing Local 790 MOA, paid overtime employees may elect to receive compensatory time off (“comp time”) instead of paid overtime until the employee reaches a maximum of 120 hours of comp time.  If the employee continues to accrue overtime beyond 120 hours, the Agency must pay the overtime rate for any hour in excess of 120 hours. [2] The proposed Agency-Local 790 MOA allows employees in the P classifications (who have elected to receive comp time) to cash-out, on an annual basis, their accrued compensatory time up to a maximum of 80 hours.  This provision is comparable to the City-Local 790 contract, which allows a paid overtime employee to cash out accrued comp time at the end of the fiscal year.

b)  Classification Review.  Local 790 has requested that the Agency change two classifications, Facility Maintenance Supervisor and Property Management Specialist, from their current exempt status as paid overtime to positions requiring the Agency to pay overtime.  Federal and state law govern this review, which will require an analysis of the positions’ job description and actual job functions.  In a side letter to the MOA, the Agency will complete this review by December 31, 2006.

3.         RETIREMENT.

As noted above, the Agency proposes to continue paying the employees’ contribution to the CalPERS retirement program.  In addition, the proposed Agency-Local 790 MOA provides that if City voters approve a change to the San Francisco Charter that gives City employees additional retirement benefits exceeding the Agency’s current benefits[3], the parties will reopen the contract for the purpose of renegotiating Agency retirement benefits.   Prior to the election at which City voters will consider the Charter amendment, the Agency will obtain an actuarial study from CalPERS for the purpose of determining the financial impact of changing the Agency’s retirement formula to conform to the City’s proposal.  If the ballot measure passes, the Agency and Local 790 will then have the information to negotiate a possible change in retirement benefits.

CONCLUSION

The new provisions in the Agency contract with the Local 790 Unit are the product of extensive negotiations and are comparable to those in the City contract for employees represented by Local 790.  Accordingly, the staff recommends approval of the Memoranda of Agreement with the Local 790 Bargaining Unit.

Originated by Jim Morales, General Counsel

                                                                        Marcia Rosen

                                                                        Executive Director