BILL ANALYSIS                                                                                                                                                                                                    Ó


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                                    THIRD READING

          Bill No:  AB 1273
          Author:   Ting (D)
          Amended:  8/28/13 in Senate
          Vote:     21

          AYES:  Pavley, Cannella, Evans, Fuller, Hueso, Monning, Wolk
          NO VOTE RECORDED:  Jackson, Lara

           SENATE APPROPRIATIONS COMMITTEE  :  7-0, 8/26/13
          AYES:  De León, Walters, Gaines, Hill, Lara, Padilla, Steinberg

           ASSEMBLY FLOOR  :  59-10, 5/30/13 - See last page for vote

           SUBJECT  :    Tidelands and submerged lands:  City and County of  
          San Francisco
                      Pier 30-32

           SOURCE  :     City and County of San Francisco

           DIGEST  :    This bill seeks a determination from the Legislature  
          that a proposed multi-purpose venue at Piers 30-32 in San  
          Francisco Bay furthers the purposes of the common law public  
          trust for commerce, navigation, and fisheries.  The building on  
          Piers 30-32 would include an arena for the Golden State  
          Warriors, an NBA basketball franchise, which could also serve as  
          a convention facility.  There will be limited retail and parking  
          associated with this venue. 

           ANALYSIS  :    


                                                                    AB 1273

          Existing law:

          1.Protects, pursuant to the common law doctrine of the public  
            trust (Public Trust Doctrine), the public's right to use  
            California's waterways for commerce, navigation, fishing,  
            boating, natural habitat protection, and other water oriented  
            activities.  The public trust doctrine provides that filled  
            and unfilled tide and submerged lands and the beds of lakes,  
            streams, and other navigable waterways (i.e., public trust  
            lands) are to be held in trust by the state for the benefit of  
            the people of California. 

          2.Grants, in trust, state public trust lands to over 80 local  
            public agencies to be managed for the benefit of all the  
            people of the state and pursuant to the Public Trust Doctrine  
            and terms of the applicable granting statutes. 

          3.Grants to the Port of San Francisco (Port), pursuant to the  
            Burton Act (Act) (Chapter 1333, Statutes of 1968) in trust,  
            the public trust lands in the harbor of San Francisco for  
            purposes of commerce, navigation, and fisheries and subject to  
            other terms and conditions specified in the Act. 

          This bill:

          1.Authorizes the State Lands Commission (SLC) to approve a  
            mixed-use development on the San Francisco waterfront at Pier  
            30-32, that includes a multipurpose venue if it finds  
            specified conditions are met.

          2.Provides for what is essentially a monitoring program which is  
            called a "trust program report" by which the Port would assure  
            the SLC at five year intervals that the conditions for public  
            uses at the site are maintained as described above.  Those  
            five year reports are to include: 

             A.   A list and description of the trust-related events and  
               programming that have occurred at the site of the mixed-use  
               development and in the multipurpose venue over the  
               preceding five-year period, including the dates on which  
               the events occurred or the multipurpose venue was made  
               available for those events, and identifying any free and  
               low-cost visitor-serving events; 



                                                                    AB 1273

             B.   A description of the efforts made by the Port, its  
               tenants, and subtenants to publicize the availability of  
               Pier 30-32, including the multipurpose venue, for  
               trust-related events and other efforts undertaken to  
               solicit such events; 

             C.   A description of the maritime program on those portions  
               of Pier 30-32 within the purview of the Port or the City,  
               including a list of the facilities constructed,  
               identification of any tenants, licensees, or other  
               operators of the maritime facilities, and a description of  
               the nature and frequency of the maritime use; 

             D.   A description of the tenants and use of the non-maritime  
               office space and the use of the public community room on  
               Pier 30-32; and, 

             E.   Any other information specifically requested by the SLC  
               that pertains to the City or Port program of trust uses for  
               Pier 30-32 and that is reasonable obtainable by the City or  

          1.Provides that the Executive Officer of the SLC may require an  
            implementation plan in case he/she determines that the trust  
            program is not being fully implemented.  The implementation  
            plan may extend to all the terms and conditions set forth in  
            the governmental approvals of the project, the leases and  
            other contracts affecting use of the site.  Those enforcement  
            provisions are triggered by the following two findings that  
            would have to be made by the Executive Officer: 

             A.   That Pier 30-32 is not being used for at least 15  
               trust-related events annually at the site as a whole or is  
               not being used for at least three trust-related events  
               annually at the multipurpose venue, as specified; or that  
               the City or the Port has not implemented the maritime  
               program for Pier 30-32 for its intended purpose; and, 

             B.   That the Port, or the City, has not taken effective  
               action to achieve the objectives specified in this bill.

          1.Amends previous legislation regarding Piers 30-32 and contains  
            the Legislature's authorization of this project as the trustee  



                                                                    AB 1273

            of the public trust. That authorization is dependent upon the  
            SLC making the findings described above.  

          2.Contains a finding and declaration that Bay Conservation and  
            Development Commission's (BCDC) regulatory authority is  
            preserved in its Bay Plan and in the Special Area Plan that  
            covers the area in which Piers 30-32 are located. 

          3.Specifies that, in addition to the findings that the SLC makes  
            pursuant to this bill, that the SLC review of the project is  
            limited to confirming the BCDC actions.  This does not confer  
            public trust consistency determination to the SLC because, as  
            drafted, that determination would be made by the Legislature. 

          4.Contains numerous amendments negotiated between BCDC and the  
            sponsors related to parking, conditions on retail, and a  
            public benefits package that would be developed separately and  
            through a public process. 

          5.Contains numerous findings and declarations that contain the  
            legislative history and its prior actions with these two  
            piers, the planning processes that have occurred by the Port,  
            by San Francisco, and by BCDC, among other items. 

          6.Contains numerous findings and declarations in specific to the  
            history, current condition, and estimated expense of  
            preserving Piers 30-32. 

           7. Allows the conditions for the sale of Seawall Lot (SWL) 330  
             under AB 418 (Ammiano, Chapter 477, Statutes of 2011) to be  
             satisfied by a public trust easement over, or a fee interest  
             in, a portion of the Baylands Parcel.  If the easement or fee  
             interest covers an area greater than that required by the  
             sale of SWL 330, the Port may treat the surplus area as a  
             credit for future trust exchanges.
          The Act allowed the granting of the Port the state to the City  
          and County of San Francisco.  The Act allows San Francisco to  
          operate, manage, regulate, and improve the granted lands in a  
          manner consistent with the public trust.  Allowable activities  
          include: activities for the promotion and accommodation of  
          commerce and navigation; and the construction, maintenance, and  



                                                                    AB 1273

          operation of public buildings, parks, and public educational and  
          recreational facilities.  Revenues from the leases and other  
          uses of the granted lands are deposited into the Harbor Trust  
          Fund (Harbor Fund) and may only be used for the management of  
          San Francisco's granted trust lands.  The Act grants the  
          tidelands and submerged lands along the San Francisco waterfront  
          to the city and county of San Francisco to be managed and  
          controlled by the San Francisco Port Commission (Commission) in  
          the public's trust.  

          The California Constitution prohibits all tidelands within two  
          miles of any incorporated city, city and county, or town from  
          being granted or sold to private parties unless the Legislature  
          finds that these tidelands are not used or necessary for  
          navigation.  The Legislature may impose conditions on these  
          sales and grants to protect the public interest. 

          AB 418 freed the public trust restrictions from SWL 330 as a  
          package of items aimed at allowing the Port to make developments  
          and investments related to the hosting of America's Cup Yacht  
          Race.  As a condition of the sale of SWL 330, the Commission  
          would be required to impress the public trust on other lands on  
          or adjacent to the San Francisco Bay that has an area equal to  
          or greater than the area of SWL 330 and is useful for trust  
          purposes, as determined by the SLC.  This approval was a  
          departure from the historic practice of requiring replacement  
          land equal in value. 

          In 2012, San Francisco entered into an agreement with the Golden  
          State Warriors to build a new, LEED Gold, multi-purpose facility  
          at Piers 30-32 capable of being used to host Warriors' home  
          games, other events including conventions, and expanding public  
          access to the waterfront, among other things.  The approval for  
          this project involves permitting from BCDC, the Board of  
          Supervisors of the City and County of San Francisco, and the  
          State Lands Commission. The project is also subject to the  
          California Environmental Quality Act (CEQA) and the project is  
          currently in the early stages of preparing a draft environmental  
          impact report. No approvals or reviews have yet been completed.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  No

          According to the Senate Appropriations Committee, no  



                                                                    AB 1273

          unreimbursed costs.  The SLC is likely to incur one-time costs  
          in the high tens of thousands to low hundreds of thousands of  
          dollars over several years to consider the development and  
          related land swaps.  There will be some minor costs ongoing to  
          monitor trust-consistent uses of the multipurpose venue.  All  
          reasonable costs will be borne by the Port or the City according  
          to a budget which will be agreed upon before the SLC's work  

           SUPPORT  :   (Verified  9/3/13)

          City and County of San Francisco (source) 
          A. Philip Randolph Institute San Francisco
          A. Philip Randolph Institute Western Region
          Alliance for Jobs and Sustainable Growth
          Asbestos, Lead and Mold Laborers Local Union 67
          Bay Area Council
          Boys and Girls Club of San Francisco
          Bricklayers and Allied Craftworkers Local 3
          Brightline Defense Project
          Building Owners and Managers Association of San Francisco  
          CAL Insurance and Associates, Inc.
          California Labor Federation
          California Sate Pipe Trades Council 
          California State Association of Electrical Workers 
          California State Council of Laborers
          Charity Cultural Services Center
          Golden State Warriors
          Hotel Council of San Francisco
          International Brotherhood of Electrical Workers Local Union 6
          Laborers' International Union of North American Local Union No.  
          Mission Hiring Hall
          Operating Engineers Local Union No. 3
          San Francisco Chamber of Commerce
          San Francisco Citizens Initiative for Technology and Innovation
          San Francisco Deputy Sherriff's Foundation
          San Francisco Fire Department 
          San Francisco Travel Association
          Sign Display & Allied Crafts Local Union No. 510
          Silicon Valley Leadership Group
          South Market Business Association
          Sprinkler Fitters and Apprentices Local 483
          State Building and Construction Trades Council 



                                                                    AB 1273

          Sustainable Futures
          United Association of Journeymen and Apprentices of the Plumbing  
          and Pipe                                                     
          Fitting Industry
          United Brotherhood of Carpenters and Joiners of American Local  
          Union No. 22
          Western States Council of Sheet Metal Workers
          Young Community Developers, Inc. 

           OPPOSITION  :    (Verified  9/3/13)

          Airport Area Business Association
          Alameda County Board of Supervisors
          City of Oakland
          Mayor of Berkeley
          Mayor of Oakland
          Mayor of Richmond
          Mayor of San Leandro
          Oakland African American Chamber of Commerce
          Pacific Merchant Shipping Association 
          Safe Storage 
          San Francisco Baykeeper
          San Francisco Tomorrow
          San Francisco Waterfront Alliance
          Save Oakland Sports
          Save The Bay
          Shred Works
          The Art Sign Company
          The Sierra Club California
          The Ultimate Sports Guide 

           ARGUMENTS IN SUPPORT  :    The author, the City of San Francisco,  
          the Port, and other key supporters of this bill believe that the  
          proposal from the Golden State Warriors for a multi-purpose  
          venue at Piers 30-32 with associated commercial development  
          across the Embarcadero at SWL 330 represents the best  
          opportunity for revitalizing the piers and maximizing public use  
          and enjoyment of the site. The estimate is that this site could  
          host 43 basketball games a year plus 160 or so other events  
          including concerts, conventions, and the like. 

          The Golden State Warriors proposal was made in May 2012, and  
          negotiations between all the affected parties began in the fall  
          of 2012. 



                                                                    AB 1273

          These two piers occupy 13 acres at one of the most desirable  
          locations in San Francisco.  Moreover, there is no dispute that  
          these two piers are in disrepair. Currently, they are used a  
          parking lot.  The estimate to repair the substructure to make  
          the piers useable for the proposed project is $68 million which  
          the Port cannot afford.  That cost would be paid by the major  
          tenant, the Golden State Warriors, in part through revenues  
          generated by the components of the project that would occur on  
          SWL 330.  The useful life of the piers is estimated at 10 years.  
           The arena itself would be privately financed. 

          Supporters point out that this project, including the arena,  
          unlike other recent stadium proposals that have been before the  
          Legislature, does not short-circuit environmental review of CEQA  
          or the regulatory approval processes by any affected agency  
          pursuant to existing law.  Approvals would be required by the  
          Port, the Board of Supervisors, the SLC, BCDC, and the San  
          Francisco Regional Water Quality Control Board, among others. 

          The heart of the request of the supporters is that the  
          Legislature determine, at this admittedly early stage of project  
          development, that the project is consistent with the public  
          trust doctrine.  The supporters believe such a determination is  
          essential to the confidence of the investors and the public  
          agencies involved in the project that the project could  
          ultimately be approved. 

          The sponsors have been engaged in active negotiations with BCDC  
          and the SLC for months, and they strongly believe that all  
          remaining details and regulatory approvals can be successfully  
          completed, even in light of the recent decision of BCDC to  
          oppose the project unless the author agrees to make the bill  
          into a two-year bill. Part of the reason for the optimism is  
          that the bill now reflects agreements between BCDC and the SLC  
          on several key points. 

          The supporters contend that this project is directly analogous  
          to other waterfront projects in California such as the Long  
          Beach Municipal Auditorium, Long Beach Convention Center, AT&T  
          Park in San Francisco, and the San Diego Convention Center. 

          Many other supporters from the San Francisco business and labor  
          community point to the non-public trust economic benefits of the  



                                                                    AB 1273

          project including an estimated 5000 construction jobs and 3000  
          direct and ongoing jobs. The annual economic output of the  
          project provided by supporters is $500 million across the entire  
          Bay region. 

           ARGUMENTS IN OPPOSITION  :    In addition to the opposition  
          (unless amended) from BCDC, other opposition to this bill falls  
          into three general categories:  (1) affected governments and  
          businesses from the East Bay concerned about regional loss  
          including economic losses, (2) environmental organizations and  
          some maritime and fishing associations who do not believe the  
          project is consistent with the Public Trust doctrine, and (3)  
          those who fundamentally disagree that the project is appropriate  
          for the waterfront. 

          A joint opposition letter from the Mayors of several East Bay  
          Cities (Berkeley, Oakland, Richmond, and San Leandro) argues  
          that this bill diminishes the authority of both the SLC and the  
          Bay Conservation and Development Commission in the project  
          approval process.  The letter states that "removing from BCDC or  
          the State Lands Commission any real role in scrutinizing a  
          massive commercial development on the Bay would run directly  
          contrary to the very purposes of these two bodies, each of which  
          has decades of experience balancing the sometimes competing  
          interests of developing and preserving the waters, tidelands and  
          submerged lands under their jurisdictions."  

          The San Francisco Waterfront Alliance, a group formed in  
          reaction to this development proposal, argues the position of  
          BCDC demonstrates that this bill is premature.  It also argues  
          that this bill enables an entertainment complex to be built over  
          San Francisco Bay waters, a resource that is jointly shared by  
          nine counties, dozens of cities, millions of citizens, and  
          enjoyed by millions of visitors.  

          San Francisco Baykeeper argues that this bill circumvents BCDC  
          and SLC authority and that the merits of the project should be  
          assessed under normal procedures.  It notes that the failure of  
          the bill would not constitute a denial of the project. 

          Save the Bay argues that the construction on the pier and the  
          project would have significant effects to the Bay's water  
          quality.  It would support uses that would require less repairs,  
          including consideration of open space or parks. 



                                                                    AB 1273

          The board of the BCDC voted to request that the author convert  
          AB 1273 into a two-year bill.  The BCDC resolution states that  
          the author's failure to do so would mean BCDC would outright  
          oppose the bill. 

          A recent staff report from BCDC seriously questioned whether the  
          proposed project is trust consistent. To quote from the  
          document, "The proposed arena is not a traditional public trust  
          use and is proposed on piers that are subject to the public  
          trust, and for this reason BCDC staff believes that the enclosed  
          arena use is not, at its heart, trust consistent.  However the  
          State Legislature, subject to judicial review, is the final  
          arbiter of the public trust in California."

          BCDC staff have noted that some progress has been made in  
          resolving open issues, and a process to resolve some of the  
          remaining open issues is also in place. Project design,  
          including its size, height, and bulk, are all essential to  
          regulatory approvals, and those inter-related issues are still  
          in flux so there are no specific outcomes on that particular  
          open issue.  The development of the off-site public benefits  
          package is deferred by mutual agreement of the parties and will  
          be established through a public process.  Those are the two most  
          significant unresolved open issues. 

          An array of other issues have been noted by opponents from San  
          Francisco itself.  These include traffic, walling off the  
          waterfront in violation of local values, standards, and  
          requirements, a lack of parking for the estimated two million or  
          so annual patrons of the proposed facility, and massive traffic  
          jams when major events at the new arena would conflict with  
          massive crowds at AT&T Park or other major downtown events.   
          Others have raised the question of whether a deadline should be  
          established for the project to be built.  Still others have  
          raised the question of whether the major tenant should be  
          required to pay for all or part of the off-site public benefits  
          package or offer some sort of compensation to Oakland to make up  
          for the expected losses at the Oracle Arena there.  

           ASSEMBLY FLOOR  :  59-10, 5/30/13
          AYES:  Achadjian, Alejo, Allen, Atkins, Bigelow, Bloom,  
            Bocanegra, Bradford, Brown, Buchanan, Ian Calderon, Campos,  



                                                                    AB 1273

            Chávez, Chesbro, Conway, Dahle, Daly, Dickinson, Donnelly,  
            Eggman, Fox, Frazier, Beth Gaines, Gatto, Gomez, Gonzalez,  
            Gordon, Gorell, Gray, Grove, Hagman, Hall, Harkey, Roger  
            Hernández, Jones, Levine, Linder, Maienschein, Mansoor,  
            Medina, Melendez, Mitchell, Morrell, Mullin, Nazarian,  
            Nestande, Olsen, Pan, Patterson, Perea, Quirk-Silva, Salas,  
            Ting, Wagner, Waldron, Weber, Wilk, Williams, John A. Pérez
          NOES:  Ammiano, Blumenfield, Bonilla, Bonta, Cooley, Logue, V.  
            Manuel Pérez, Quirk, Skinner, Wieckowski
          NO VOTE RECORDED:  Chau, Fong, Garcia, Holden, Jones-Sawyer,  
            Lowenthal, Muratsuchi, Rendon, Stone, Yamada, Vacancy

          RM:nl  9/3/13   Senate Floor Analyses 

                           SUPPORT/OPPOSITION:  SEE ABOVE

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