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Supplemental AGENDA - Port of Oakland

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					                                                                                                  AGENDA



                             PORT OF OAKLAND
                                                                                       JAMES W. HEAD
OMAR BENJAMIN                                                                                President
Executive Director            BOARD OF PORT COMMISSIONERS                          PAMELA CALLOWAY
                               530 Water Street  Oakland, California 94607          First Vice-President
DAVID L. ALEXANDER                                                                   GILDA GONZALES
Port Attorney                           Telephone: (510) 627-1100                  Second Vice-President
                                        Facsimile: (510) 451-5914                 MARGARET GORDON
                                            TDD/TTY – Dial 711                         Commissioner
ARNEL ATIENZA
Port Auditor                                                                        KENNETH KATZOFF
                                   E-Mail:board@portoakland.com                          Commissioner
                             Website:   www.portofoakland.com                        MICHAEL LIGHTY
JOHN T. BETTERTON
                                                                                        Commissioner
Secretary of the Board
                                                                                          VICTOR UNO
                               Supplemental AGENDA                                        Commissioner



                         Meeting of the Board of Port Commissioners
                             Tuesday March 29, 2011 – 2:00 p.m.
                                        Board Room – 2nd Floor

ROLL CALL

           1st Vice President Calloway, 2nd Vice-President Gonzales, Commissioner Gordon,
           Commissioner Katzoff, Commissioner Lighty, Commissioner Uno and
           President Head.

1. CLOSED SESSION (2:00 p.m.)

           CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION. Pursuant to
           subdivision (a) of Section 54956.9.

           SSA Terminals, LLC and SSA Terminals (Oakland), LLC v. the City of Oakland, Acting by
           and Through its Board of Port Commissioners Docket No. 09-08

   1.1     CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION. Significant
           exposure to litigation pursuant to subdivision (b) of Section 54956.9: 3 matter(s)

   1.2     CONFERENCE WITH REAL PROPERTY NEGOTIATOR - As provided under California
           Government Code Section 54956.8:

                         Property:       Former Oakland Army Base and Adjacent Properties
               Negotiating Parties:      Port of Oakland, AMB Properties and California Capital Group
               Agency Negotiator:        Director of Maritime, James Kwon
                Under Negotiation:       Price and Terms of Payment




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  1.4   CONFERENCE WITH LABOR NEGOTIATORS - Pursuant to Subdivision (f) of Section
        54957.6.

         Agency Designated Representative: Marsha Peterson
                  Employee Organizations: International Brotherhood of Electrical Workers
                                           (IBEW Local 1245), International Federation of
                                           Professional and Technical Engineers (IFPTE
                                           Local 21), Service Employees International
                                           Union (SEIU Local 1021), and Western Council
                                           of Engineers (WCE)

  1.5   PUBLIC EMPLOYEE PERFORMANCE EVALUATION

        Title: Executive Director, Port Attorney, Port Auditor, Board Secretary

ROLL CALL/OPEN SESSION (approximately 4:00 p.m.)

        1st Vice President Calloway, 2nd Vice-President Gonzales, Commissioner Gordon,
        Commissioner Katzoff, Commissioner Lighty, Commissioner Uno and
        President Head.

CLOSED SESSION REPORT

        The Port Attorney or Board Secretary will report on any final actions taken in Closed
        Session.

2. MAJOR PROJECTS

        This segment of the meeting is reserved for action and discussions regarding the status
        of Major Projects and issues of special importance.

  2.1   Authorization for the Executive Director to enter into a Supplemental Agreement for ERP
        Support and Related Activities

  2.2   Update on Shore Power Program (Maritime)

  2.3   Presentation of Cost Sharing and Lead Agency Agreements with the City of Oakland and
        the Oakland Redevelopment Agency related to development of the former Oakland army
        base property. Supplemented (Maritime)

3. BUDGET & FINANCE

        This segment of the meeting is reserved for action or discussion regarding the status of
        Budget and Finance issues.

  3.1   Unaudited Financial Results for 7 Months Ended January 31, 2011



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4. STRATEGY & POLICY

        This segment of the meeting is reserved for action or discussion on Strategy and Policy
        Issues.

  4.1   Strategic Plan Progress Report #2 (Richard Sinkoff)

  4.2   Government Funding & Advocacy Update, Supplemented (External Affairs)

  4.3   Port Communications System (External Affairs)

5. CONSENT ITEMS

        Action by the Board under “Consent Items” means that all matters listed below have
        been summarized and will be adopted by one motion and appropriate vote. Consent
        Items may be removed for further discussion by the Board at the request of any member
        of the Board.

  5.1   Approval of the Minutes of the Regular Meeting of March 15, 2011 (Board Secretary)

  5.2   Approval of a Fourth Supplemental Agreement with ARINC, Inc. to Provide 2nd Level
        Maintenance Support and Licensing for the iMUSE Common Use System at the Oakland
        International Airport for One Year for $114,252 with the Option for a Second Year for
        $114,252 (Aviation)

6. REMAINING ACTION ITEMS

        Remaining Action Items are items not previously addressed in this Agenda that may
        require staff presentation and/or discussion and information prior to action by the Board.

  6.1   Approval of an Amendment to the Ground Lease for Pavilion 2 in Jack London Square
        (CRE)

  6.2   Authorization to Allocate Remaining Vision 2000 Air Quality Mitigation Funds to the Port
        Shore Power Program and to a Port Energy Efficiency and Renewable Energy Study
        (Environmental)

7. UPDATES/ANNOUNCEMENTS

        The President and/ or Executive Director will report on noteworthy events occurring since
        the last Board Meeting.

  7.1   March 3, 2011 City/Port Committee Summary




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8. SCHEDULING

      This segment of the meeting is reserved for scheduling items for future Agendas and/or
      scheduling Special Meetings.

OPEN FORUM

      The Board will receive public comment on non-agenda items during this time. Please fill
      out a speaker card and present it to the Secretary of the Board.

ADJOURNMENT

      The next Regular Meeting of the Board will be held on April 12, 2011 at 2:00 p.m. in the
      Board Room.




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                                        PUBLIC PARTICIPATION

Disability Related Modifications
Any person who requires a disability-related modification or accommodation, including auxiliary aids or
services, in order to participate in the meeting, may submit a written request, electronic request, or telephone
request [via the California Relay Service (telephone) for the hearing impaired at (800) 735-2922], to the
Secretary of the Board no later than five working days prior to the scheduled meeting date.
                                    John Betterton, Secretary of the Board
                                    530 Water Street, Oakland, CA 94607
                                        jbetterton@portoakland.com
                                                (510) 627-1696
Language & Interpretive Services
As a grantee of federal aid grant funds from the US Department of Transportation, the Port is responsible for
ensuring equal access to its programs, services, and benefits. To request bilingual interpreters or materials in
alternate formats, please contact the Director of Social Responsibility no later than five working days prior to
the scheduled meeting date.
                             Diann Castleberry, Director of Social Responsibility
                                   530 Water Street, Oakland, CA 94607
                                      dcastleberry@portoakland.com
                                                (510) 627-1302
Scented Products
Please refrain from wearing scented products to this meeting so attendees who experience chemical sensitivities
may attend.
To Speak on an Agenda Item
You may speak on any item appearing on the Agenda. Please fill out a Speaker’s Card and give it to the Board
Secretary before the start of the meeting or immediately after conclusion of Closed Session. Cards received
after the start of the meeting will be treated as a single request to speak in Open Forum. All speakers will be
allotted a minimum of one minute.
Agenda & Related Materials
Should you have questions or concerns regarding this Agenda, or wish to review any of the Agenda Related
Materials, please contact the Board Secretary, John Betterton, at (510) 627-1696, or visit our web page at
www.portofoakland.com
To receive Port Agendas and Agenda Related Materials by email, please email your request to
jbetterton@portoakland.com




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                                        MAJOR PROJECTS Tab 2



                   MAJOR PROJECTS
This segment of the meeting is reserved for action and
discussions regarding the status of Major Projects and
issues of special importance.




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                                                                              BOARD MTG. DATE: 3/29/2011

                                                AGENDA REPORT

TITLE:                  Authorization for the Executive Director to enter into a Supplemental
                        Agreement for ERP Support and Related Activities

AMOUNT:                 Disclosed to the Board of Port Commissioners 1

PARTIES INVOLVED:

                         Corporate Name/Principal                                         Location
                         Yield Technologies, Inc.                                         Chicago, IL


TYPE OF ACTION:                                    Resolution

SUBMITTED BY:                                      Joyce Washington
                                                   Acting Deputy Executive Director

SCHEDULED FOR BOARD:                               March 29, 2011

APPROVED BY:                                       Omar Benjamin, Executive Director

SUMMARY

The Port of Oakland is currently implementing Oracle E-Business suite, an Enterprise
Resource Planning (ERP) system. Implementing an ERP system supports the Port’s goal
to provide timely and relevant information to support critical analysis and decision making.
The implementation covers the areas of Finance, Procurement, Human Resources,
Property Management and Enterprise Asset Management.

The system switchover occurred on the “Go-Live” date of October 1, 2010.

This Board Agenda requests authority to enter into a supplemental agreement with Yield
Technologies, Inc. to provide ERP post “Go-Live” support and related activities.

FACTUAL BACKGROUND

The IT Strategic Business Plan included modernization of the Port’s existing technology
and software systems by implementing an Enterprise Resource Planning (ERP) system.
Unlike existing Port systems, an ERP system allows for the integration of data/processes of
the organization into a unified database. Once information is entered, it becomes available
to all ERP system components immediately. The ERP system offers powerful analytical
tools, robust management reporting, performance measurement, and allows the Port to
streamline its application portfolio. Key objectives for this project include retirement of


1
 The Executive Office has informed the Board of its estimate for the cost of these services. It is not disclosed here in the
best interest of the public and the competitive process. Actual amounts will be available after all the contract agreement
has been obtained.


Yield Supplemental Agreement-262108v2                           1


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                                                          BOARD MTG. DATE: 3/29/2011

outdated, unsupported systems, transitioning the organization toward a more automated
environment, and eliminating manual processes.

On July 2, 2009, by Resolution No. 09102, the Board of Port Commissioners authorized the
Executive Director to execute agreements to implement the ERP system and to provide
ERP training services. An agreement with Yield Technologies to implement the system
was subsequently executed.

Yield Technologies’ scope of work included implementing the software in the areas of
Finance, Human Resources, Procurement, Projects, Enterprise Asset Management and
Property Management. The original scope also included programming for 64 custom
components (data exchanges with external parties [interfaces], reports and forms) and
support for thirty days after the transition from the legacy systems to Oracle.

ANALYSIS

On October 1, 2010, the Port switched to the new Oracle ERP system for most of the Port
business processes.

The Oracle system is complex and represents a major change in technology for the
organization, as well as a major cultural shift for Port staff. Over the course of eleven
months, the Port implemented 23 of the 29 planned Oracle modules. While progress has
been made, challenges still exist with user adoption and system stability. Although the
transition has been slower and more difficult than anticipated, lessons are being learned
and solutions are being identified. Port staff is committed to working through the issues to
become proficient with the new system as this project represents a significant milestone
and achievement for the Port of Oakland.

The original contract assumed that the consultant only needs to provide 30 days of post
“Go-Live” support. However, given the challenges with user adoption and system stability,
additional near-term support from Yield Technologies is required to supplement in-house
staffing in the following areas:

      •   Ongoing knowledge transfer and skill building for Port Staff
      •   Daily Support
      •   Programming and issues resolution
      •   Configuration assistance for system design changes/modifications
      •   New custom reports

STRATEGIC PLAN ALIGNMENT

    Strategic                Goal                 Objective              ERP Project
  Priority Area                                                             Impacts
Communications      Goal L: Provide timely   3. Complete ERP        ERP Phase 1 has
and Information     and relevant             Phase 1 and            been completed.
                    information to support   commence Phase 2       The system went
                    critical analysis and    Analytics              “live’” on October 1,
                    decision-making                                 2010.

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                                                           BOARD MTG. DATE: 3/29/2011

Stewardship and     Goal E: Improve the      2. Strengthen        The system has
Accountability      processes for            contract             capability for project
                    evaluating and           expenditure controls budgets,
                    managing capital                              supplements
                    expenditures and                              performance
                    for long term                                 management
                    management of Port                            systems and
                    property and                                  monitors spending
                    infrastructure                                only for approved,
                                                                  funded projects.
Port Workforce      Goal H: Develop and      1. Identify, assess  The Oracle system
and Operations      maintain a high          and implement key    will eventually
                    performing workforce     skills and           provide the tools
                                             knowledge required necessary to
                                             for an employee      effectively perform
                                             within a public      the tasks required.
                                             enterprise           Near term
                                                                  transitional support
                                                                  is anticipated to be
                                                                  completed by June
                                                                  30, 2011. Ongoing
                                                                  support to refine
                                                                  and improve the
                                                                  system will be
                                                                  needed on a
                                                                  continuous basis.

BUDGET & FINANCIAL IMPACT

ERP post “Go-Live” Support and Related Activities was not included in the Port’s FY 2011
Capital Budget or 5-year Capital Needs Assessment. Authorization to enter into a
supplemental agreement with Yield Technologies would increase the Port’s FY 2011
Capital Budget by the amount disclosed to the Board of Port Commissioners1.

STAFFING IMPACT

No additional staffing is needed in FY 2011. It is anticipated that an IT managerial position
will be needed beginning in FY 2012.

SUSTAINABILITY

To the extent possible, procurement staff will endeavor to meet the Port’s procurement
needs by placing orders or entering into agreements with vendors who have a sustainability
policy and follow green practices in the conduct of their business practices.




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                                                          BOARD MTG. DATE: 3/29/2011




ENVIRONMENTAL

The California Environmental Quality Act (CEQA) Guidelines, Section 15061(b)(3) ("the
general rule") states that CEQA applies only to projects that have the potential for causing
a significant effect on the environment. Because it can be seen with certainty that
amending these professional services agreements will not have a significant effect on the
environment, these actions are therefore not a project under CEQA, and no environmental
review is required.

MARITIME AND AVIATION PROJECT LABOR AGREEMENT (MAPLA)

The work performed under this contract is not within the scope of the Port of Oakland
Maritime and Aviation Project Labor Agreement (MAPLA) and the provisions of the MAPLA
do not apply to this work.

OWNER CONTROLLED INSURANCE PROGRAM (OCIP)

OCIP does not apply.

GENERAL PLAN

This action does not meet the definition of "project" under the City of Oakland General
Plan, and no conformity determination is required.

LIVING WAGE

Based upon a review of the terms of the agreement and information provided by the
contractor, it appears that the living wage requirements set forth in Section 728 of the
Charter of the City of Oakland and Port Ordinance Number 3666, as amended, do not
apply because the contractor employs fewer than the 21 employees working on Port-
related work required for coverage.

OPTIONS

1.   Authorize the Executive Director to enter into a supplemental agreement with Yield
     Technologies, Inc. to provide near term ERP post “Go-Live” Support and Related
     Activities. This is the recommended option.

2.   Do not authorize the Executive Director to a supplemental agreement with Yield
     Technologies, Inc. to provide ERP post “Go-Live” Support and Related Activities. This
     option would not provide adequate funding for the necessary support for successful
     implementation of the ERP project and would result in further delays in achieving the
     desired operational proficiency.




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                                                        BOARD MTG. DATE: 3/29/2011




RECOMMENDATION

It is recommended that the Board of Port Commissioners authorize the Executive Director
to enter into a supplemental agreement with Yield Technologies, Inc. to provide near term
ERP post “Go-Live” Support and Related Activities in an amount as disclosed and
described to the Board of Port Commissioners1.




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Presentation:
Cost Sharing and Lead Agency Agreements with the City of Oakland
and the Oakland Redevelopment Agency Related to Development of the
Former Oakland Army Base Property.


The Port will be presenting to the Board of Commissioners the status of the discussions
with the City of Oakland and the Oakland Redevelopment Agency (Agency) regarding
the development of the former Oakland Army base property.

The City, the Port and the Oakland Redevelopment Agency have been in discussions to
determine the terms and conditions for a Cost Sharing and Lead Agency Agreement by
which the Agency will provide seed moneys of up to $32M that enables the City and the
Port to begin preliminary design, environmental approvals and some infrastructure
planning work related to the future development of both the City and Port property at the
former Oakland Army Base. This presentation will outline the status of those discussions
and review the term and conditions of the proposed agreement. A general outline of the
presentation is below:
    1. City of Oakland / Oakland Redevelopment Agency Proposed Actions:
           a. AMB/CCG Negotiations
                     i. Term
                    ii. Expenditure of ORA Funds for Planning and Design
                   iii. Use of AMB/CCG Design Team
           b. Authorize Execution of a Cost Sharing Agreement with the Port
                     i. Timing
                    ii. Agency Funding
                   iii. Port Baseline Agreements with CTC
                   iv. Funding Uncertainties – Tax Increment, Grant Funds, etc.
                    v. Designate City as CEQA Lead Agency
    2. City of Oakland / Oakland Redevelopment Agency Timing
           a. March 29 review by CED Committee
           b. April 5 tentative City Council / Redevelopment Agency Board review
    3. Next Steps for the Port
           a. Formal consideration of Cost Sharing Agreement
           b. Staff recommendation on OAB interested parties
           c. Work with City to attract additional public funding for the OAB project.
           d. Redevelop OAB into new Trade and Logistics Center




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n f ^ ' i C l Oy THE CIT t ClFRf
           O
       v.L N  REDEVELOPMENT AGENCY
   01 A 1 H
  21H R7 P 5 ^^j^^j) j H E CITY OF OAKLAND
                                             AGENDA REPORT
         TO:               Office of the Agency Administrator
         ATTN:             Dan Lindheim
         FROM:             Community and Economic Development Agency
         DATE:             March 29, 2011

         RE:               An Agency Resolution Authorizing:

                           (1) The Agency Administrator to Negotiate and Execute a Second
                           Amendment to the Exclusive Negotiating Agreement (ENA) with A M B
                           Property Corporation/California Capital Group (AMB/CCG) for a
                           Development on the former Oakland Army Base ("Base") to:

                           A. Extend the ENA term from April 22,2011 to the earlier of April 22,
                              2012 or the Execution of a Lease Disposition and Development
                              Agreement; and

                           B. Provide for: (A) Reimbursement to A M B / C C G of up to a Maximum
                              Amount of $14,100,000 for the Planning and Design Work for the
                              Base's Infrastructure, Public Utilities, and Public Streets; (B)
                              Approval of AMB/CCG's Proposal for a Development Team, Scope of
                              Work, Budget, and Schedule for the Planning and Design Work; (C)
                              Elimination of the Requirement to Accommodate the Oakland
                              Produce Market and the Oakland Film Center as Part of the
                              Development; and (D) Expansion of the Development Area to Include
                              the Former Oakland Maritime Support Services ENA Site in the East
                              Gateway Area

                           (2) A Waiver of the Advertising and Request for Proposal /
                           Qualifications Process and an Award of the Planning and Design of
                                                                                           **
                           Infrastructure Improvements for the Port-Oriented Railyard and T*
                           Street Overpass Work, in an Amount Not-To-Exceed $3,850,212, to
                           AMB/CCG

                           A City Resolution Authorizing:

                           (1) The City Administrator to Negotiate and Execute an Exclusive
                           Negotiating Agreement Between the City of Oakland and A M B / C C G for a
                           Development on the Former Oakland Army Base Without Returning to
                           the City Council


                                                                                   Item:
                                                                                     CED Committee
                                                                                      March 29, 2011



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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 2


               (2) A Waiver of the Advertising and Request for Proposal /
               Qualifications Process and an Award of the Planning and Design of
                                                                               "
               Infrastructure Improvements for the Port-Oriented Railyard and 7 *
               Street Overpass Work, in an Amount Not-To-Exceed $3,850,212, to
               AMB/CCG


SUMMARY

Staff requests that the Agency Board and the City Council adopt two resolutions that make it
possible for either the Agency or the City to move forward with necessary planning activities
for the former Oakland Army Base.

The first resolution seeks Agency Board authorization to negotiate and execute a Second
Amendment to the Exclusive Negotiating Agreement ("SAENA") with AMB/CCG, which
sets in motion the infrastructure planning'for the entire Army Base, and award a contract to
AMB/CCG for the planning and design of infi-astructure improvements for the Port-oriented
Railyard and 7^ Street Overpass. In the event the Agency is dissolved by the state legislature
and the City assumes ownership of the Army Base property, the Second resolution enables the
City to enter into the same type of agreements and carry on the infrastructure planning and
design work for the Base without delay. The SAENA is an amendment to the existing ENA,
the terms of which remain intact, but for the changes brought about by the Second
Amendment. The Term sheet for the SAENA is attached and the SAENA is summarized in
the Project Description section of this Report.

The SAENA is critical for the development of the former Oakland Army Base and for
achieving the benefits that a full build out of the Base will provide Oakland. It implements the
public/private process that the Agency has always planned on using to develop the Army
Base, and brings into alignment the publicfijndsand private expertise essential for planning,
designing, and constructing Army Base infrastructure in a timely manner. Moreover, the
SAENA enables the Agency to ready the Army Base for development while staff negotiates a
Lease Disposition and Development Agreement (LDDA) and completes the environmental
analysis required under the California Environmental Quality Act (CEQA). Regardless of the
outcome of the LDDA negotiations, the infrastructure design work makes it possible to move
forward with developing the Army Base and will create value for the Agency and City.

Unlike the basic backbone infrastructure required of the Army Base, which is essential for the
development of the AMB/CCG ENA Development Area, the infrastructure improvements for
the Port-oriented Railyard and 7^ Street Overpass are not essential to the planning and design
of the ENA Development Area. However these Port-oriented improvements are necessary to
preserve the $242,000,000 in Trade Corridor Improvement Funds (TCIF) which were
awarded to the Port of Oakland but may be lost if the Railyard and the 7^ Street Overpass are
not designed in a timely manner. Since this work is not essential to the planning and design of


                                                                             Item:
                                                                               CED Committee
                                                                                March 29, 2011



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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 3


the ENA Development Area, it must be awarded pursuant to the Agency's/City's purchasing
processes unless the Board/Council determines that it is in the City's best interests to waive
the requirements. Staff recommends that the Port Railyard and the 7^ Street Overpass work
be awarded to AMB/CCG to ensure a unified approach to the design of the Army Base.

FISCAL IMPACT

The SAENA and Port-oriented planning and design work commit up to $14,100,000 in total
funding from the following sources for planning and design work:

   •    $9,490,000 from the Joint Infrastructure Development Fund (JIDF) (9572), Oakland
        Army Base Organization (88679), Army Base Joint Infi-astructure Development
        Project (S415810)
    •   $3,010,000 from JIDF (9572), Oakland Army Base Organization (88679),
        Infrastructure Master Plan Project (S415820)
    •   $1,600,000 from OBRA Federal and State Grant Fund (9577), Oakland Army Base
        Organization (88679), Infrastructure Master Plan Project (S433810)

The funding from Project (S415820) is the local match for a $2,000,000 TIGER II planning
grant the U.S. Department of Transportation awarded to the Agency, and the funding from
Project (S433810) is the portion of the TIGER II award allocated to the Oakland Army Base.
Use of the TIGER II award and local match for Army Base infrastructure planning was
authorized by Resolution 2011-0006 C.M.S. Future tax increment (9570) may be used to
replace Fund (9572) as the source of the local match for the TIGER II award.

The fiinding for the Port-oriented planning and design work, in an amount not-to-exceed
$3,850,212, may be allocatedfromany of these three sources. The fijnding from these sources
may be appropriated into new Projects, which will be established as necessary.

Should the Agency be dissolved, the City will assume ownership of the Army Base property
and all assets and liabilities associated with it.

BACKGROUND

Public/Private Process

It has long been recognized that the former Oakland Army Base would require major public
investment and infi^astructure improvements before any private investment would be feasible.
The Oakland Army Base Request For Qualifications (RFQ) and Request For Proposals (RFP)
anticipated that the master developer would design and construct the necessary off-site




                                                                             Item:
                                                                               CED Committee
                                                                                March 29, 2011



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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                      .                       Page 4


improvements' with public funding and be responsible for funding the on-site infrastructure
and development^. This approach is consistent with standard redevelopment practice and
AMB/CCG's response to the RFP.

The cost of infrastructure improvements for the entire Army Base is preliminarily estimated to
be $500,600,000, of which approximately $130,000,000 is needed for the Agency-owned
portion of the Base. Due to the strategic importance of the site to the region and the nation, 93
percent of the public investment will ultimately come from state and federal sources. An
initial outlay, however, of Agency and Port of Oakland funds is necessary to secure and
leverage the state and federal funding. The Agency's commitment of $14,100,000 to master
plan Army Base infrastructure makes it possible to meet a condition of the $242,000,000
awarded to the Port through California's Trade Corridor Improvement Fund (TCIF), that
construction start by December 2013. A Funding Chart attached as Attachment A details the
fimding sources for infrastructure design and construction. If infrastructure planning and
design does not begin immediately, the Agency and Port risk losing the TCIFfiindsand
anticipated matching federal funds. Utilizing AMB/CCG's Development Team to prepare the
planning and design documents is the surest and most timely way to accomplish the work.

AMB/CCG ENA

On January 19, 2010, the Agency entered into an ENA with AMB/CCG for a term of 360
days. A copy of the January 19, 2010, ENA is aUached as Attachment B. All the terms of the
original ENA remain in effect, except for the Schedule of Performance, which has been
updated to reflect the extended time frame and to indicate which activities have been
accomplished since the approval of the ENA.

Throughout 2010, the Agency and AMB/CCG worked on completing the schedule of
activities set forth in the ENA's Schedule of Performance. One of the activities required the
retention of environmental consultants to prepare a site assessment and all documentation
necessary for environmental review under the California Environmental Quality Act (CEQA).

On July 20, 2010, to expedite obtaining the CEQA review, the Agency and AMB/CCG
entered into a First Amendment to the ENA to allow the Agency to contract with a consultant
to prepare the necessary documents and to share the costs of that contract with AMB/CCG. A
copy of the First Amendment is attached as Attachment C. That environmental work is now
well underway. In December 2010, the ENA was administratively extended, as provided for
in tiicENA, to April 22, 2011.




^ Off-site improvements are public roadways and utility systems within the public right-of-way and the
necessary environmental remediation and grading of the entire site.
^ On-site improvements include development pads, buildings and other structures built on the pads, internal
roadways, and utility laterals to serve the buildings and structures.

                                                                                           Item:
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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 5


The proposed SAENA will provide for the additionaltimeneeded to complete the CEQA
analysis required for LDDA approval, complete negotiation of the LDDA terms (including the
required Community Benefits), and authorize the Agency to reimburse AMB/CCG for the
cost of its Development Team to do the necessary infrastructure planning and design. A key
step in the Schedule of Performance is the requirement that the Developer present a proposal
for the Development Team, Scope, Schedule, and Budget for the infrastructure planning. As a
result of AMB/CCG's work during 2010, the first year of the ENA, that step has been
completed. Agency staff and consultants have reviewed the proposal and deemed it to be a
sound basis for proceeding.

Port TCIF Allocation and the Cost Sharing Agreement

The former Army Base will be developed through a partnership of the Agency, Port, and
AMB/CCG. Last summer when the Port's TCIF allocation appeared to be in jeopardy. Port
staff, assisted by AMB/CCG, negotiated a new project baseline agreement with the California
Transportation Commission (CTC), and expanded the development of the Outer Harbor
Intermodal Terminal (OHIT) to include improvements to adjoining Agency-owned areas and
to 7^ and Maritime Streets. This expansion of the OHIT project area allows certain Agency
expenditures to be counted toward the dollar-for-doUar match funding required for the
$242,000,000 TCIF allocation.

The re-negotiated agreement between the Port and CTC identifies $32,000,000 in matching
investment by the Agency, which includes the Agency's contribution of $5,700,000 to a Joint
Environmental Remediation Fund (JERAF), $16,300,000 to a Joint Infrastructure Development
Fund (JIDF), and $10,000,000 infiituretax increment over a seven year period or income
from other sources. The Agency's $32,000,000 will leverage $62,000,000 in TCIF funds
(which, when combined with anticipated matching federal dollars will bring $134,000,000 to
the Agency-owned portions of the Army Base). Should the Agency be dissolved, and the City
is unable to meet all or a portion of the $10,000,000 target, the City and Port will renegotiate
the TCIF commitment to the Agency/City.

A pending Cost Sharing Agreement between the Port and the Agency commits the Port to
investing up to $62,000,000 in TCIFfijndsfor construction activities, including remediation,
site preparation, public streets and infrastructure, on Agency-owned portions of the Army
Base. The SAENA, which provides for an initial expenditure of $14,100,000 from the JIDF
for infrastructure planning and design, will position the infrastructure project to start
construction by the TCIF deadline of 2013.

It cannot be over emphasized that TCIF funding is over-subscribed and projects not
progressing run the risk of being dropped. Without the immediate initiation of the
infrastructure master plan, which can best be implemented and managed through the private
means and methods provided for in the SAENA, the Agency and Port risk losing
$242,000,000. All indications are that the Port recognizes the importance of working


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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 6


cooperatively to preserve the TCIF grant and the Cost Sharing Agreement should be presented
to the Agency for its review in the very near future.

KEY ISSUES AND IMPACTS

Potential Dissolution of the Redevelopment Agency

At the time of this writing, it appears as if the State will dissolve Redevelopment Agencies as
of July 1, 2011. The Agency and City have taken actions to preserve Agency assets and
resources in order to continue redevelopment activities to the extent possible under the
direction of the City. This report and resolutions are intended to enable the Agency and City
to continue to prepare the Army Base for commercial development and to comply with our
obligations to the Department of the Army and the State Department of Toxic Substances
Control.

Agency Control of the Planning Process

Given the pending Cost Sharing Agreement with the Port, it is appropriate that the scope of
the infrastructure planning to be undertaken by AMB/CCG encompass the entire Army Base,
including the Port's concession area and the North Gateway, for which AMB/CCG has no
rights under the ENA. The terms of the SAENA ensure Agency control of the infrastructure
master planning process. AMB/CCG cannot proceed with planning for Port elements, such as
              *^
the rail and 7" Street overpass, until directed to do so by Agency staff, who will be overseeing
the entire process through ongoing weekly reviews, monthly reports, and quarterly
presentations.

Community Benefits Process

The SAENA does not alter the basic framework of the non-binding, non-exclusive
Community Benefits Term Sheet included as Exhibit C in the original agreement.

Under the leadership of Councilmembers Brunner and Nadel, there has been a series of
workshops designed to gather inputfromcommunity members and other stakeholders
regarding community benefits. City staff has participated in each of these workshops and are
analyzing the terms and conditions that have emerged through consensus of the workshop
participants. To the greatest extent possible, these terms and conditions will be incorporated
within a draft Community Benefits Agreement, which will be subject to negotiations, as with
other business and legal terms and conditions, with all developers and ultimately included in
binding Lease Disposition and Development Agreements between the Agency and each of the
developers, including AMB/CCG.




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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 7


Waiver of Advertising and RFQ/RFP Process and Award of Work

The planning and design work for the Port-oriented Railyard and 7*^ Street Overpass is not
essential to the development of the ENA Development Area and therefore should be awarded
pursuant to the Agency's/City's purchasing processes unless the Board/Council determine
that it is in the Agency's/City's best interests to waive the requirements. Purchasing processes
required for planning and design services usually entail advertising and RFQ/RFP process to
select the provider. It is in the best interests of the Agency/City to waive the competitive
process for the planning and designing of infrastructure improvements for the Railyard and 7^
Street Overpass work, and award the work to AMB/CCG for the following reasons:

    •   AMB/CCG was already selected through such a process for the development of the
        ENA Development Area. Completing a new RFP process could take over four months.
    •   Time is of the essence in completing the infrastructure planning and design for the
        Base. The Port could lose its TCIF award of $242,000,000 and the Agency its
        $62,000,000 allocation of the award if the Railyard and 7^ Street Overpass are not
        designed in a timely manner.                   '
    •   The Amended and Restated Memorandum of Agreement between the Agency and the
        Port contemplates a unified approach to the design of the Army Base.

Compliance with the California Environmental Quality Act

The SAENA does not constitute an approval by the Agency of AMB/CCG's proposed project;
the approval of any specific project by the Agency Board is subject to CEQA, where
applicable. The Agency reserves all of its rights and duties under CEQA with respect to
proposed Army Base development, including without limitation the authority to do any and
all of the following: (a) prepare an environmental study evaluating the impacts of a proposed
project, feasible alternatives to the project, and feasible mitigation measures; (b) adopt any
feasible altematives and/or feasible mitigation measures to lessen any significant
environmental impacts resulting from a proposed project; (c) determine that any significant
environmental impacts of a proposed project that cannot be mitigated are acceptable due to
project benefits overriding any significant unavoidable impacts; and/or (d) decide to modify
or deny its approval of a proposed project, and not to proceed with the project, due to the
results/findings of the CEQA process.

The proposed SAENA complies with CEQA for the following reasons: (1) some activities
covered under the SAENA have already been evaluated by the previously certified 2002 EIR,
such as hazardous materials remediation; (2) certain activities covered under the SAENA are
statutorily exempt from CEQA, such as Planning and Feasibility Studies, including detailed
design and engineering efforts, pursuant to CEQA Guidelines section 15262; (3) the proposed
commitment of fiinds from the Joint Infrastructure Fund is merely afimdingmechanism that
is not subject to CEQA, pursuant to CEQA Guidelines section 15378(b)(4); and (4) this action
is exempt from CEQA pursuant to CEQA Guidelines section 15061(b)(3), where it can be


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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                             Page 8


seen with certainty that there is no possibility that the project may have a significant effect on
the environment.

PROJECT DESCRIPTION

The Term Sheet outlining the SAENA is attached as Attachment D. The following is a
summary of the terms of the proposed SAENA:

1.     Extension of the ENA term until the earlier of April 22, 2012, the completion of
       CEQA and execution of a Lease Development and Disposition Agreement, or the
       termination of the ENA due to a default.

2.     Approval of the Developer's proposed team of consultants, scope of work, schedule,
       and budget, as represented in Exhibits to the Second Amendment to the ENA.

3.     Agreement to reimburse the Developer's third party consultant costs through the
       Agency's Joint Infrastructure Development Fund, established for the development of
       the former Oakland Army Base, up to a maximum amount of $14.1 million, for
       infrastructure master planning and design work for the entire Oakland Army Base. The
       Developer will receive no reimbursements or fees for its own costs in the management
       of the design consultant team. All final design decisions for the public infrastructure
       portions shall be made by the Agency and other City departments. The Developer will
       be responsible for all costs related to the vertical development planning and any site
       improvement planning on the development sites.

4.     Elimination of the requirement to accommodate the Film Center and the Produce
       Market as part of the development.

5.     Terms specifying how the Agency and Developer will coordinate regarding outside
       agency negotiations, ongoing property management during the design phase, and
       securing additional other government fimding.

6.     Modification of the ENA boundaries to refiect the relocation of the former Oakland
       Maritime Support Services (OMSS) ENA area from the East Gateway area and the
       possible sale of several acres of the current ENA area to Caltrans for relocation of
       their Maintenance Facility. The Developer is required to cooperate with the planning
       of a new location for OMSS and the sale of any land to Caltrans, and any user selected
       for the Subaru Lot in the North Gateway.

SUSTAINABLE OPPORTUNITIES

Economic: The redevelopment of the former Oakland Army Base will create thousands of
temporary and permanent jobs, substantially increase the City's tax base, and support the

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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 9


long-term competitiveness of the Port of Oakland.

Environmental: The improvements planned for the development of the former Army Base,
including the expansion of rail service and providing a permanent site for truck parking, will
help reduce air pollution.

Social Equity: Social equity is ensured through the City's and Port's local hiring and
contracting requirements. Community benefits associated with the project will be substantial,
including contributions to the West Oakland Community Fund and support for workforce
development programs. Staff will return to the Agency Board at a later date with options and
recommendations for how to meet most effectively the Agency's, Port's and master
developer's community benefits goals and priorities.

DISABILITY AND SENIOR CITIZEN ACCESS

Any projects and programs implemented in this project area will be required to comply with
applicable City, state, and federal disabled access requirements.

RECOMMENDATION AND RATIONALE

Staff recommends that the Agency Board/City Council adopt the resolutions authorizing the
Agency/City Administrator to (1) negotiate and execute a Second Amendment to the
Exclusive Negotiating Agreement between the Agency and A M B Property
Corporation/California Capital Group, and (2) negotiate and execute an ENA between the
City and AMB/CCG without returning to City Council. Staff also recommends that the
Agency Board/City Council approve the waiver of advertising and solicitation of
proposals/qualifications and award the design of the Port-oriented Railyard and Overpass
infrastructure improvements work to AMB/CCG. The SAENA provides more time to
complete CEQA and to negotiate the terms of an LDDA, including community benefits, and
allows the Agency to use that time to begin infrastructure planning and design for the former
Oakland Army Base and avoid losing slate and federal dollars. The award of the Port Railyard
and Overpass work to AMB/CCG takes advantage of AMB/CCG's Development Team,
which is already in place, and ensures a unified approach to the design of the Army Base, s

ACTION REQUESTED OF THE CITY COUNCIL/AGENCY BOARD

Staff requests that the Agency Board and the City Council adopt the two resolutions to
authorize:

(1)    The Agency/City Administrator to negotiate and execute a SAENA/ENA between the
       Agency/City and AMB/CCG



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Dan Lindheim
CEDA/Redevelopment: AMB/CCG ENA Second Amendment                                           Page 10


(2)   A waiver of the advertising and RFP/RFQ process and an award the planning and
      design of infrastructure improvements for the Port-oriented Railyard and 7^^ Street
      Overpass work, in an amount not-to-exceed $3,850,212, to AMB/CCG.


                                             Respectfully submitted,


                                             UJLjD^i^
                                             Walter S. Cohen, Director
                                                                                    —
                                             Community and Economic Development
                                             Agency

                                             Reviewed by:
                                             Gregory Hunter, Deputy Director of Economic
                                             Development and Redevelopment

                                             Prepared by:
                                             Pat Cashman, Project Manager

APPROVED AND FORWARDED TO THE
COMMUNITY/AND ECONOMIC DEVELOPMENT COMMITTEE:



Office of the City/Agency Administrator


Attachments:     A.   Funding Chart
                 B.   ENA between the Agency and AMB/CCG
                 C.   First Amendment to the ENA
                 D.   Term Sheet of the Second Amendment to the ENA




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                                ATfACHMENT A

                       FUNDING C H A R T -
             SOURCES FOR THE ESTIMATED $500,000,000
                 PUBLIC INFRASTRUCTURE COST

                    .   .   .   .                         IliundllU.sg
                                           BSmSuntl


                                                                          •
                                                                         •N
                                           [(millions)!                  l20rl!4I16l
Agency/City Cost Sharing Agreement
 Joint Infrastructure Development Fund            16.3          16.3
 Joint Remediation Fund                            5.7            5.7
 TIGER li Grant                                    1.6            1.6
 Tax Increment if available                        8.4            ^A            7.0


Port TCIF                                       242.0          200.0           42.0
Federal DOT ask                                  150.0         150.0
Future Match*                                     60.0          30.0           30.0
Additional Funds Needed*                          16.0                         16.0



  Future Match and Additional Funds Needed will consist of a mix of
 federal and private sources.




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                                              MAJOR PROJECTS Tab 2.3




                   ATTACHMENT B
         EXCLUSIVE NEGOTIATING AGREEMENT

                         BETWEEN

THE O A K L A N D REDEVELOPMENT A G E N C Y AND A M B / C C G




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                       EXCLUSrVE NEGOTIATING AGREEMENT


               This Exclusive Negotiating Agreement (this "Agreement"), dated for reference
purposes only as of January 22, 2010, is by and between the Redevelopment Agency of the City
of Oakland, a community redevelopment agency organized and existing under the California
Community Redevelopment Law (the "Agency"), and AMB Property, L.P., a Delaware limited
partnership ("AMB") and California Capital Group, a California generaljjartnership ("CCG")
and then- successor in interest (collectively, the "Developer").

       This Agreement is made vnth reference to the following facts and circunastances:

               A. The Agency owns or controls a portion of the former Oakland Army Base
('*OAB') and other lands; the Agency wishes to develop a portion of the GAB known as the
Gateway Development Area, which portion consists of approximately 118 acres (the
"Property"), as shown in Exhibit A and as further described m the Request for Proposals for the
Property issued by the Agency September 26,2008 (tiie "RFP").

B. The respective ownership and management interests in Developer are expected to be as
follows: AMB/CCG have created aflexiblejoint venture structure wherein the parties will work
together to master plan the development and associated infrastructure while separating
responsibilities for development of individual components of the project based upon each parties
area of expertise. The joint venture vwll be the entity that has the legal authority to contract
directiy with the Agency. Economic interests in individual projects will vary between
AMB/CCG, with AMB taking the lead for industrial related development and CCG taking all
development responsibilities in the major office, R&D, and film center developments.

                C. The parties hereto desire to enter intofiirthernegotiations relating to the
master operation and maintenance, and the design, construction, finance, and lease of the
facilities on the Property (the "Project") to determine and finalize the terms of a Lease
Disposition and Development Agreement (the "LDDA") to enter into a Master Lease Agreement
(the "Master Lease Agreement")

               D. The context of the negotiations is based upon the following documents
attached hereto for reference purposes as follows:

                      i) , The ORA RFP dated 9/25/08
                      ii)  The AMB/CCG response dated January 22, 2009
                      iii) The ORA staff report and supplements of July 14, 2009

             NOW THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, the Developer and the Agency hereby agree as follows:




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                1.       Effective Date and Term. The effective date of this Agreement is January
 19, 2010 (the "Effective Date"). The term of this Agreement shall commence on the Effective
Date and expire on the earlier of (i) 360 days from the Effective Date, not mcluding City/ORA
furlough days designated m a City Council resolution unless extended by mutual agreement of
the parties or earlier terminated as permitted under this Agreement, and (ii) the effective date of
the LDDA (the "Term"). Notwithstanding the foregomg, either party may terminate this
Agreement without liability to the other party by delivering sixty (60) days' prior written notice
to the other party.

        ' 2.     Negotiations. During the Term, the Agency will negotiate exclusively with the
Developer and in good faith for the purpose of developing objectives and goals of both the
Agency and Developer for thefiituredevelopment of the Property. The Agency and Developer
each acknowledge that there were certain differences between the Agency's RKP and the
Developer's submittal in response thereto, and the parties agree to negotiate in good faith to
resolve such differences. Furthermore, the Developer intends to work collaboratively with the
Agency to create a development plan that (i) addresses and takes advantage of any local. State,
federal and private investments to improve the local, regional, or statewide economy,
environment, and employment through a public-private partnership, and (ii) incorporates the
development plan elements of the Agency's previously proposed site development in areas
ovvned by the Agency, including projects that may qualify for fimding by the State of California
through its Trade Corridor Improvement Fimd program and otherfimdingmechanisms which
Developer and Agency may agree to use. In addition, the parties mutually agree to cooperate
witii the City of Oakland ("City"), the Port of Oakland ("Port"), the State of California, and the
federal governments in seeking additional developmentfimdingthrough other State and federal
programs, including the American Recovery and Remvesttnent Act of 2009 and the anticipated
surface transportation reauthorization legislation. During the Term, the parties will discuss and
negotiate such other issues relating to the proposed transaction as may be identified by either
party hereto, including, without limitation, the respective development interests, equity interests,
and responsibilities of AMB and CCG; the procedure for soliciting community input on the
environmental standards for construction; acknowledgement of the validity of the Oakland
Parking Tax; and consideration of the nonexclusive and nonbinding topics for discussion
attached hereto as Exhibits B and C, with the objective of documenting their mutual
understanding and agreements with respect to all such issues in the LDDA and form Master
Lease Agreement. During the Term, Agency shall have therightto rent, lease, license, or use all
or any portion of the Property for uses that would not have a materially adverse effect on
Developer's rights under this Agreement, as determined by Agency in its reasonable judgment
afi:er consultation with Developer. Without limiting the foregoing. Developer acknowledges that
the existing leases within the Property do not violate its exclusiverightsunder this Agreement.
The Parties will use their best efforts to perform the activities within thetimeperiods set forth in
the Schedule of Performance attached hereto as Exhibit D.

        The parties agree to negotiate the LDDA in good faith on or before the expiration of the
Term, and each agrees to negotiate in good faith and to dedicate to the negotiations a sufficient
amount of staff (including legal services) time and attention, including the time and attention of
staff designated with decision making authority in this matter, as necessary, during the Term. If
the parties are unable to agree upon the final forms of the LDDA and the Master Lease


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Agreement by the expiration of the Term, or if Agency's governing body declines to authorize an
LDDA fi^r any reason in its sole and absolute discretion, then without fiirther action, this
Agreement shall terminate, any and all deposits shall be retumed to the developer (CCG) within
thhty (30) business days, unless otherwise extended by mutual agreement. In the event this
Agreement is terminated as of the end of the Term, or if either party terminates the Agreement
early, the Agency and the Developer shall have no fiirther obligation to negotiate exclusively
with each other for the future development of the Property.

        With respect to the subject matter of this Agreement, the lead negotiator for the Agency
will be the Agency Administrator, and the lead negotiator for Developer will be Phil Tagami.

               3.       Agency Acting as Ovroer of Real Property; Cooperation. The Developer
acknowledges that the Agency is acting in its capacity as a property owner with a proprietary
interest in the Property and not as a regulatory agency with police powers. Developer
                                                                      Q
understands that although Agency and the City may have some or £ 1 of the same members of
then governing bodies, they are two separate legal entities, with separate jurisdictions and
procedures. Nothing in this Agreement shall limit m any way the Developer's obligation to
obtain any regulatory approvalsfromany governmental agency including, witiiout limitation, the
City, having jurisdiction over the Property or the operations proposed to be conducted thereon.

               The Agency shall cooperate with the Developer in its efforts to obtain such
Regulatory Approvals, provided that (1) the Agency shall not be required to incur any out-of-
pocket costs and (2) nothing in this Section 3 shall otherwise limit Agency's own approval rights
under this Agreement. Nothing in this Agreement shall restrict Developerfiromexercising its
lawfiilrightsto meet with or contact any regulatory agency, utility company, prospective tenant,
governing body, other developer, or any other extemal agency or party and share project ideas
and details with any such contacted party, except that Developer shall not disclose documents
which are not yet subject to disclosure under the Brown Act or the City's Sunshine Ordinance.
Agency agrees that it will not intentionallyfiaudulentiyinterfere with Developer's efforts to
obtain Regulatory Approvals.

               4.      Agreements Subject to Environmental Review and Governmental
Approvals. By entering into this Agreement, the Agency is not committing itself or agreeing to
undertake any definite course of action. The terms of this Agreement do not commit the Agency
to undertake (a) any conduct to dispose of or grant control over the Property to Developer, or (b)
any other acts or activities predetermining, affecting, or influencing the subsequent independent
exercise of discretion related to the transactions contemplated hereunder by the Agency or by
any other governmental agency or authority. The Developer iacknowledges that the Agency
cannot enter into or be bound by any documents or agreements that will cause or result in any
fiiture work by the Developer on the Property (including the LDDA and Master Lease
Agreement) or a grant of any rights with respect to any development of the Property imtil all
environmental reviews required by CEQA or NEPA, or any other necessary regulatory
approvals, are completed.

               5.     Governing Law. This Agreement shall be deemed to be made in and shall
be construed in accordance with the laws of the State of California.


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                6.      Relationship of the Parties: No Assignment. Developer is and shall at all
times be and remain independent from the Agency and shall not be an agent of the Agency.
Nothing herein contained shall be construed to place the parties in the relationship of partners or
joint ventures. Neither party shall have anyrightor power to obligate or bind any other party m
any manner whatsoever except as expressly authorized in this Agreement. This Agreement is not
intended, nor shall it be construed, to create any third party beneficiaryrightsin any third party,
unless otherwise expressly provided. The Agency is not a fiduciary and has no special
responsibilities beyond any obligations expressly set forth herein to Developer. Developer may
propose to add passive investors to its entity provided that such investors shall have no decision-
making authority with respect to the project; provided, however, that the Agency Board retains
the right, in its sole and absolute discretion, to approve or disapproval of any change in the
Developer's entity. This Agreement is personal to Developer and, except as described in Recital
B hereof, is not assignable to any other person or entity v\dtiiout the, prior written consent of
Agency which may be given or refused m the Agency's sole and absolute discretion. Any
attempt to assign this Agreement or any part of the Agreement without the prior written consent
of Agency shall constitute a material breach of this Agreement and shall be void and no force
and effect.

                7.      Attorneys' Fees. If Agency has breached its obligations to negotiate in
good faith or to negotiate exclusively with Developer, Developer may elect either to terminate
this Agreement and have retumed to CCG its ENA Deposit, or to seek specific performance of
the exclusive negotiating and good faith obligations of this Agreement. Developer shall not be
entitled to recover any damages of any kmd or character from Agency. In the event of a default
under this Agreement or in the event a dispute arises in a judicial or quasi-judicial proceeding
concerning the meaning or interpretation of any provision of this Agreement, the defaulting party
or the party not prevailing in such dispute, as the case may be, shall pay any and all costs and
expenses incurred by the other party in enforcing or establishing its or their rights hereunder
(whether or not such action is prosecuted to judgment), including, without limitation, court costs
and reasonable attorneys' fees. For purposes of this Agreement, reasonable fees of attorneys of
the City Attorney's Office, acting as the Agency's Counsel, shall be based on the fees the City
Attorney pays its outside private attorneys who work on any such dispute. The provisions under
this Section 7 shall survive the Term.

               8.      Indemnity. Developer shall indemnify, protect, defend and hold harmless
the Agency and the Agency's officers, agents and employees, from and against any and all
claims, demands, losses, liabilities, damages, liens, injuries, penalties, fines, lawsuits and other
proceedings, judgments and awards and costs and expenses, including, without linutation,
reasonable attomeys' and consultants' fees and costs through appeal ("Losses"), arising out of or
related to exclusively personal injury and property damage related to Developer's activities on
the Property or its agents, employees or contractors, under this Agreement, except to the extent
such Losses are caused by the negligence or wilifiil misconduct of Agency. The provisions under
this Section 8 shall survive the Term.

              9.    Notices. Unless otherwise expressly provided herein, any notice given
under this Agreement shall be effective only if in writing and given by delivering the notice in


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person or by sending itfirst-classmail or certified mail with a return receipt requested or by
Express Mail, return receipt requested, with postage prepaid, or via facsimile, as follows:




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           ff to Agency:      Redevelopment Agency of the City of Oakland
                              City of Oakland, Community and Economic Development
                              Agency
                              250 Frank H. Ogawa Plaza, Suite 5313
                              Oakland, CA 94612
                              ATTN: Dan Lindheim, Agency Director and City
                              Administrator

           Copy to            Redevelopment Agency of the City of Oakland
                              City of Oakland, Community and Economic Development
                              Agency
                              250 Frank H. Ogawa Plaza, Suite 5313
                              Oakland, CA 94612
                              ATTN: Walter Cohen, CEDA Agency Du-ector
                              510-238-2226 (Fax)

           Copy to:           Redevelopment Agency of the City of Oakland
                              c/o City of Oakland, Community and Economic Development
                              Agency
                              250 Frank H. Ogawa Plaza, Suite 5313
                              Oakland, CA 94612
                              ATTN: Gregory Hunter, Deputy Dkector of Redevelopment
                              510-238-6455 (Fax)

           Copy to:           Redevelopment Agency of the City of Oakland
                              c/o City of Oakland, Community and Economic Development
                              Agency
                              250 Frank H. Ogawa Plaza, Suite 5313
                              Oakland, CA 94612
                              ATTN: Al Auletta, Area Manager
                              510-238-6391 (Fax)

           Copy to:           Redevelopment Agency Counsel
                              c/o Oakland City Attorney's Office
                              One Frank H. Ogawa Plaza, 6*^ Floor
                              Oakland, CA 94612
                              ATTN: Dianne Millner, Supervising Deputy City Attorney for
                              Redevelopment
                              510-238-6500 (Fax)

           If to Developer:   California Capital Group c/o Phil Tagami
                              300 Frank Ogawa Plaza, Suite 340
                              Oakland, CA 94612
                              510-834-5380 (Fax)

           Copy to:           AMB Property Corporation c/o Dan Letter


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                                  1360 WiUow Road, Suite 100
                                  Menlo Park, CA 94025
                                  415-277-2171 (Fax)

               Copy to;          John Markley, Esq.
                                 620 Greystone Terrace
                                 Orinda California 94563
                                 and
                                 Jeff Trant, Esq.
                                 Law Office of Jeffrey A. Trant
                                 P.O.Box 4026
                                 Los Altos, CA 94012
                                 .650-386-6091 (Fax)



                10.    Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument.

                11.    Transaction Costs. At all times during the Term, the parties agree that each
party will be responsible for all of its own costs and the costs associated with any consultants of
other members of its own team related to the negotiation and preparation of any and all
transaction documents.

                12.   ENA Deposit. The Agency acknowledges the receipt of $50,000 deposit
since January 22, 2009 (the "ENA Deposit"). The Agency acknowledges that the fimds have
been deposited in an interest bearing account. The ENA Deposit, along with any interest eamed
thereon, will be retumed to CCG within thirty (30) days of expiration of the Term if the parties
have not entered into the LDDA or upon earlier temunation of this Agreement. If the LDDA is
executed by both parties hereto prior to the end of the Term, then the ENA Deposit shall be part
of the negotiated LDDA consideration.

        13.     Due Diligence Materials: The Agency will cooperate reasonably with Developer
in allowing Developer to inspect and copy, at no cost to the Agency, all documents as Developer
may request and which are in the possession of and available to the Agency, relating to the
condition of the Property, mcluding, but not limited to, the documents which were listed m the
RFP, as said list may be updated by the Agencyfromtune-to-time, structural integrity of any
improvements thereon, existing utility plans, civil engineering surveys, a current legal
description of the Property, development studies, existmg improvement plans, any thkd party
agreements affecting use, operation or ovmership of the Property, biological studies and all other
information, reports and studies which affects the Property (the "Property Information").
Following the Effective Date, the parties may enter into a non-disclosure agreement in a form
mutually satisfactory to the Agency and Developer prior to the Agency releasing any requested
documents. With respect to the Property Information, Developer acknowledges that the Agency
makes no representation regarding the accuracy or completeness of such documents, and


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Developer is not relieved of any of its obligations hereunder or under applicable law as a result
of such delivery of any such documents. Developer agrees that if it uses any such documents.
Developer will assume ail risk of any inaccuracies contained or reported in, and the lack of
completeness of such documents, whether or not any such documents are available to Developer.
Developer shall be responsible for undertaking any studies or reports necessary to develop the
Property in accordance with a Project to be agreed upon pursuant to the terms and conditions of
the LDDA and Master Lease Agreement.

               14.    Right of Entry: Upon request, the Agency will grant Developer therightto
enter on the Property during normal business hours for the purpose of performing non-mvasive,
visual investigations of the Property to assess the feasibihty of developing the Property. If
Developer wishes to conduct any physical studies of the Property, includmg invasive
investigations regarding environmental conditions, soil condition or physical building
inspections. Developer shall submit a detailed written proposed scope of work ("Proposed Work
Plan") for the Agency's review and approval in the Agency's proprietary capacity as the owner
of the Property. The Agency, acting in its proprietary capacity, shall have the right to grant,
deny, or condition such Proposed Work Plan in its reasonable sole discretion. It shall be
reasonable for the Agency to deny such Proposed Work Plan if the Proposed Work Plan requires
the Agency to incur any cost or expense other than the staff time of those Agency staff directly
involved in the exclusive negotiations under this Agreement. If the Agency approves or
conditionally approves such Proposed Work Plan, the Agency will grant Developer a right of
entry under a Right of Entry Agreement ("ROE Agreement") prepared and approved by the City
Attorney or his designee. If the Proposed Work Plan requires any permits or other governmental
approvals (includmg, without limitation, any City permits). Developer shall work vwth the City
to obtain any such governmental approvals at no cost or expense to the Agency. If the Proposed
Work Plan reqmres any City permits, the City may (acting m its regulatory capacity) grant, deny,
or condition such City permits in its sole and absolute discretion, ff an ROE Agreement is
entered into. Developer shall provide copies of all reports and studies regarding the condition of
the Property (including, without limitation, any improvements or subsurface conditions) prepared
by, for, or on behalf of, the Developer as a result of such entry upon the Property. Developer
shall not unreasonably interfere with any tenant or user on the Property or on adjoining parcels
owned by Agency.                                              J

               15.     City of Oakland Campaign Contribution Limits. This Agreement is
subject to the City of Oakland Campaign Reform Act of Chapter 3.12 of the Oakland Municipal
Code and its implementing regulations because it requires Agency governing body approval.
The City of Oakland Campaign Reform Act prohibits contractors that are doing business or
seeking to do business with the Redevelopment Agency of the City of Oakland fiom making
campaign contributions to Oakland candidates between commencement of negotiations and
eitherlSO days after completion of, or termination of, contract negotiations. Developer must sign
and date an Acknowledgment of Campaign Contribution Limits Form attached hereto and
incorporated herein as Exhibit E.


                                 [Signatures on following page]



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           DEVELOPER:

           AMB PROPERTY, L.P., a Delaware
           limited partnership

           By: AMB PROPERTY CORPORATION,
           a Maryrand corporation,




           By:
           Its:

           Dated:


           CALIFORNIA CAPITAL GROUP, a
           California general partnership

                       4^e5== 7
           Its:   Hfhnri^i-^            p^/>K^'
           Dated:        */       (


           REDEVLOPMENT AGENCY OF THE
           CITY OF OAKLAND, a community
           redevelopment agency organized and
           existing under tKelCalifomia Community
           Red^^Blop mentiLaw


           Dan Lindheim
           Agency Administrator


           Approved as to form and legality:


           Dianne Millner
           Agency Counsel




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                             MAJOR PROJECTS Tab 2.3




             EXHIBIT A

           Map of ENA Area




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                                                              MAJOR PROJECTS Tab 2.3




THE FOLLOWING EXHIBITS B AND EXHIBIT C ARE NONEXCLUSIVE AND NONBINDING TOPICS
FOR FURTHER DISCUSSION AND CONSIDERATION BETWEEN THE PARTIES DURING THE TERM OF
THE ENA.
                                  REAL ESTATE TERMS
                                     EXHIBIT B
1    LANDLORD:                          Redevelopment Agency of the City of Oakland
2    LESSEE:                            To be desi^ated by Developer
2A   GUARANTOR FOR LDDA                 [Note- Gxiaiantor must be financially strong entity with
     COMPLETION GUARANTY                significant assets to guarantee L D D A Project completion
                                        obligation, as determined by Agency]
3    PROPERTY:                          Approximately 118 acres of Army Base Property, excluding
                                        the OMSS Parcel.
4    AGREED USE:                        Film Center, Produce Market, logistics facilities, Class A
                                        office, research and development facilities, project-serving
                                        retail, waterfront open space, J A T C job training facility,
                                        recycling facilities, or as Negotiated
5    INITIAL T E R M :                  66 years
                                        Term shall commence on lease execution (*Xease
                                        Commencement Date")

5A T E R M I N A T I O N RIGHTS         Lessee has no right to terminate Lease. Landlord has right
                                        to terminate Lease due to Developer default or breach.
6    LEASE C O M M E N C E M E N T      Lease execution date.
     DATE
7    RENT C O M M E N C E M E N T       One hundred twenty (120) days fcom execution of the
     DATE                               lease.
8    EXTENDED TERM:                     Landlord shall grant, at its sole and absolute discretion one
                                        (1) additional thirty-three (33) year option to extend the
                                        Lease. Option is at Landlord's sole and absolute discretion
                                        and may be exercised at least two (2) years in advance of
                                        the end of the current term.
9    POSSESSION:                        Upon lease execution and no later than eighteen (18)
                                        months after execution of an L D D A .
10   RENT:                              Fair Market Rent to be determined by the parties during
                                        the E N A period.
11   PAYMENT OF RENT:                   Rent shall be paid annually on or before July 1 of each and
                                        every year of the term. Lessee shall pay prorated annual
                                        rent for Year 1 on the Rent Commencement Date.
12   RENTAL R A T E ADJUSTMENT          As negotiated during the E N A
13   TAXES/ EXPENSES                    Lessee shall pay any and all taxes, including, but not Umited
                                        to, possessory interest tax. Lessee shall pay any and all
                                        expenses associated with the Property.




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14   INSURANCE                   Lessee pays.
                                 Commercial General Liability: $5,000,000
                                 Worker's Compensation: Statutory Limits (no less than
                                $1,000,000)
                                 Employer's Liability: $1, 000,000
                                 Automobile Business Liability: $1,000,000
                                 Pollution Limited Liability: $1,000,000
                                 All coverages are subject to periodic increase as
                                determined by the City*s Risk Manager
15   CONDITION OF PROPERTY AT   Lessee shall take delivery of the premises in an As-Is
     DELTVERY                   condition subject to any and all existing tide exceptions,
                                encumbrances, liens, and real property agreements
                                including, but not limited to, three quitclaim deeds
                                recorded in 2002 by the State of CaUfomia Department of
                                Transportation and the following umecorded tenancy
                                agreements: 1) Oakland Maritime Support Services Lease,
                                2) City of Oakland Winter Shelter License, 3) Oakland
                                Film Center Licenses (sixteen total), 4) Pacific Coast
                                Container Lease. Lessee is responsible for identifjmig and
                                transferring three acres of land in the GARB to JATC per
                                the M O A between Agency and JATC. Any alternative to
                                the transfer of OARB land to JATC is at the sole expense
                                of Lessee.

16   ENVIRONMENTAL              Agency and Lessee will negotiate detailed terms of
     REMEDIATION                environmental remediation responsibility and liability based
                                upon the RAP/RMP. Remediation will include, but is not
                                limited to, remediating and removing existing utility
                                infrastructure, and receiving closure letters fi:om
                                environmental regulatory agencies with a mutual goal of
                                completing remediation by August 2013. Agency wiU
                                reimburse specified costs on tenns to be detailed in the
                                L D D A . Terms of liability for discovery of unanticipated
                                pre-existing environmental contamination will also be
                                negotiated and detailed in the L D D A .
17   INDEMNIHCATION             Lessee shall agree to provide standard commercial hold
                                harmless and defend provisions to the City of Oakland and
                                the Redevelopment Agency of the City of Oakland and its
                                employees, officers, dicectors, shareholders, partners and
                                agents
18   DEED RESTRICTIONS &        Lessee accepts and acknowledges the Property is subject to:
     ENVIRONMENTAL USE           1) deed restrictions in the transfer deeds, 2) a recorded
     RESTRICTIONS               covenant to restrict use of property, and 3) tight of access
                                across the Property to allow for remediation or monitoring
                                by federal and state agencies.




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19   UTILITY INFRASTRUCTURE    Landlord does hot warrant or guarantee utility service to
                               the Property. Landlord will coordinate with Lessee, Port of
                               Oakland and any other utility service provider the use of
                               existing utility infrastructure. Landlord shall cooperate with
                               Lessee in the development of new utility infrastructure to
                               serve the Property on terms to be ne^tiated.
20   SECURITY DEPOSIT          To be negotiated
21   LANDLORD'S MAINTENANCE    None. Lessee is responsible for all maintenance.
22   COMMISSION:               Landlord shall not pay or be liable for any commissions or
                               brokerage fees. Lessee shall hold harmless and defend
                               Landlord against any claims for commissions or brokerage
                               fees.
23   SIGNAGE                   Lessee may not install or place signage on any existing City
                               street on the Property or within any Qty street to be
                               created or the public corridor. I^essee may install and place
                               signage oo the remaining Property in compliance with City
                               codes
24   TAXES & PUBLIC            Lessee shall pay all operating expenses to operate the
     IMPROVEMENTS              Project in a manner outlined in the lease agreement
     MAINTENANCE & INSURANCE   Lessee's operation expenses to include aU capital
                               expenditures, security and insurance for the Property and
                               Project Lessee to maintain the Property and Project in
                               first-class condition.
25   FAIR SHARE                Lessee shall be responsible for paying a fan- share of any
                               required off-site traffic improvements and/or other
                               mitigations, as detennined by the Oakland Army Base
                               Fau- Share Allocation Report, pursuant to the Mitigation
                               Monitoring & Reporting Report of the Oakland Army
                               Base Redevelopment Area Plan Envuronmental Impact
                               Report. F i m l terms of details of this provision shall be
                               detennined prior to entering in the LDDA.
26   LANDLORD ACCESS           Landlord has the right to enter and inspect the Property
                               and Project after reasonable notification to Lessee.
27   CITY/AGENCY PROGRAMS      Lessee to comply with all City/Agency social programs in
                               both construction and operations including, without
                               limitation, labor peace agreement, prevailing wages, living
                               wages, local and small local business, equal benefits,
                               disabled access, and apprenticeship/job training/first
                               source hiring programs. Lessee must agree to comply with
                               compliance monitoriing by Af;ency.




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28   GOOD F A I T H DEPOSIT                      Developer has deposited with Agency a fifty thousand
                                                 dollar (J50.000.00) Good Faith Deposit in die form of
                                                 certified funds or a letter of cxedit in favor of Agency. If
                                                 the Parties enter into an L D D A , or Developer negotiates in
                                                 good faith but fails to reach agreement with Agency, or
                                                 Agency otherwise declines, i n its sole and absolute
                                                 discretion, to enter into an L D D A , Agency shall return the
                                                 Good Faith Deposit to Developer. If Developer fails to
                                                 negotiate in good faith with Agency or fails to fulfill the
                                                 conditions or meet the obligations set forth in this
                                                 Agreement as reasonably determined by Agency, Agency
                                                 may exetdse its option to retain the Good Faith Deposit as
                                                 liquidated damages.
29   PROJECT E X P E N S E P A Y M E N T           To be negotiated.
30   E Q U I T Y P A R T I C I P A T I O N W I T H To be negotiated.
     AGENCY




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T H E FOLLOWING EXHIBITS B AND EXHIBIT C ARE NONEXCLUSIVE AND NONBINDING TOPICS
FOR FURTHER DISCUSSION AND CONSIDERATION BETWEEN THE PARTIES DURING THE T E R M OF
THE ENA.
                                           EXHIBIT C
                                         Community Benefits
1   LANDLORD:                                     Redevelopment Agency of the City of Oakland (Agency)
2   LESSEE:                                       To be des^nated by Devdopei
3   A G R E E D USES:                             Film Center, Produce Ivlarket, logistics facilities, Class A
                                                  office, research and development facilities, project-serving
                                                  retail, waterfcont open space, J A T C job training facility,
                                                  recycling fecilities, or as Negotiated
4   COMMUNITY           FUND                      Lessee shall pay its fair share of the two million dollar
                                                  ($2,000,000) Community Fund based upon acreage leased
                                                  within a timeframe to be negotiated during the E N A period.
5   CITY / A G E N C Y CONTRACTING                Lessee to comply with all . City/Agency social justice
    REQUIREMENTS                                  contracting programs in both construction and operations
                                                  phases, including, without limitation: prevailing wages,
                                                  living wages, local and small local business, disadvantaged
                                                  business program, equal benefits, disabled access, and
                                                  apprenticeship/job training/first source hiring programs.
                                                  Lessee must agree to comply with compliance monitoring by
                                                  Agency.

6   L O C A L H I R E , R E T E N T I O N , JOB   To ensure that project construction provides the strongest
    TRAINING &                                    possible training and employment opportunities for targeted
    APPRENTICESHIPS FOR                           residents, a Labor Peace Agreement for project construction
    C O N S T R U C T I O N JOBS                  shall include requirements for a share of project hours to be
                                                  worked by targeted residents and by apprentices. The
                                                  Agency will require all general contractors to develop a plan
                                                  for satisfying these requirements, and to obtain approval
                                                  from the Agency of that plan prior to commencement of
                                                  work. Targeted hiring reqiiirements will be monitored and
                                                  enforced.
7   L O C A L H I R E A N D FIRST                 In order to advance the Agency's goal of providing
    SOURCE HIRING FOR                             economic opportunities to residents of communities that
    P E R M A N E N T JOBS                        have borne the brunt of social, economic and health
                                                  impacts, the Agency will require Lessee to ensure that all
                                                  project employers participate i n a First Source hiring
                                                  program for operations-phase jobs (i.e., non-construction
                                                  jobs). This program will require employers to designate a
                                                  first source system, prior to hiring; consider targeted
                                                  applicants referred by the fiist source system; and hire a
                                                  percentage of targeted applicants. The Agency wiU designate
                                                  one or more nonprofit entities to refer applicants as part of
                                                  the first source system. Targeted hiring requirements will be
                                                  monitored and enforced through a process to be established


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                           by the Agency and similar to the Port of Oakland's MAPLA
                           program, dirough which employers and contractors report
                           progress, and challenges are addressed in a collaborative
                           manner by various stakeholders from a particular industry,
                           including community representatives and any relevant labor
                           union(s).
   LABOR PEACE             Lessee is required to agree to the following language in its
                           lease agreement with the Agency: The parties recognize that
                           in order to protect the Agency's proprietary interests in
                           uninterrupted receipt of the income and public services
                           promised under this contract, labor disputes must be
                           prevented. Hie parties agree that as a material condition of
                           this agreement, Lessee shall cause each employer of
                           employees rendering Services on the premises to sign a labor
                           peace agreement with any labor organization which has
                           informed the Agency that it represents or seeks to represent
                           such employees, unless die Alameda Labor Council advises
                           that such labor organization is not actively organizing in
                           such industry.

                           A "labor peace agreement" means any written agreement
                           which (a) waives the right of the labor organization and its
                           members to engage in picketing, work stoppages, boycotts,
                           or other economic interference with the Agency's
                           proprietary interests in the premises for the duration of the
                           Agency's lease; and (b) provides that any services to be
                           performed by employees of the employer's tenants,
                           subtenants, contractors, or subcontractors will also be done
                           under agreements containing the same labor peace
                           assurance. "Services" for these purposes means janitorial,
                           security, building and groiinds maintenance, warehousing
                           and distribution, industrial, mechanics and tmck services,
                           retail, hotel (and any testaiirant connected thereto), and
                           grocery sales.                            ;
   PERFORMANCE STANDARDS   To assist the Agency in assuring that project development is
   AND REPORTING           proceeding in a timely manner towards the Agency's goals.
                           Lessee will be required to submit regular progress reports on
                           satisfaction of various project requirements, including
                           construction progress, financial goals, local hire,
                           emplo3rment retention, and small/local business utilization,
                           air quality and environmental health. In the Lease
                           Development & Disposition Agreement (LDDA), the
                           Agency will set goals in each of these areas for each phase of
                           construction and operation of the project The L D D A will
                           stipulate penalties if goals are not met and incentives if goals
                           are exceeded.



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10   WORKFORCE TRAINING          Lessee should be prepared to coordinate with local
                                 workforce training programs to provide trained workers for
                                 both constmction and relevant permanent jobs and ensure
                                 that programs have resources to advance the Agency's goal
                                 of sustainable economic development of surrounding
                                 neighborhoods.


n    COMMUNITY OUTREACH &        Lessee is required to create and maintain a program of
     ENGAGEMENT                  ongoing communication and collaboration with relevant
                                 community stakeholders to ensure tiiat there is community
                                 understanding and support for the project
12   COMMUNITY SERVICES &        Lessee should describe how project will result in creation of
     AMENITIES                   community services and amenities such as grocery stores,
                                 banks and other retail, community centers or child care
                                 centers, on or off-site, to benefit the surrounding
                                 neighborhoods.
13   RELOCATION OF POLLUTING
                                 Lessee should describe plan to relocate polluting and other
     AND OTHER HAZARDOUS USES
                                 hazardous uses from the adjacent West Oakland
     FROM WEST OAKLAND
                                 neighborhoods onto the project area, including recycling
                                 facilities and tmcking activities. Plan should include analysis
                                 of how project will decrease or increase communities'
                                 exposure to pollution.
14   URBAN DESIGN PRINCIPLES &   The design of the GDA should be coherent, incoiporate
     COHERENT DEVELOPMENT        distinctive, innovative architecture, ensure a mix of uses,
     PLAN                        and be flexible enough to evolve over time.
15   GREEN INDUSTRIES            Project should indicate types, nimabers andtimingof green
                                 businesses and industries to be included in project, establish
                                 recruitment incentives, and describe potential synergies
                                 among industries and how they wiU interact with whole
                                 development.




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                                MAJOR PROJECTS Tab 2.3




           "Green" development principles should be applied which
           meet or exceed City of Oakland's Green Building Ordinance
           and related policies, including design, construction, building
           materials, use of alternative energy sources, resource
           efficiency, waste stream diversion, communications
           technology and transportation. Plans to meet these
           standards, including energy generation and/or savings and
           details of carbon-neutral program, should be provided.
           All major facilities constructed on the Project site should
           achieve energy efficiency levels at least 20% better dian Tide
           24 requirements, and receive certification under the U.S.
           Green Bmlding Council*s L E E D program at a minimum of
           liie L E E D Silver level. Project plans should demonstrate
           higher levels of green building achievement, including
           potential certification of the Project as a whole under the
           T P,KD for Neighborhood Development rating system
           and/or achievement of additional credits as prescribed
           under that rating system and other guiding documents such
           as the Alameda County Waste Management Authority's Bay-
           Friendly Landscape Guidelines. A significant portion of the
           Project's ongoing energy requirements should be met with
           on-site clean, renewable energy technologies.
           Infrastmcture should be installed to enable allfedlitiesto
           use recycled grey water as an alternative to potable water for
           uses not requiring potable water (e.g., sewage conveyance).
           Systems should be designed to treat 100% of storm water on
           site, and to make use of rainwater and/or recycled water on-
           site where possible. Potable water should not be used for
           site irrigation.
           Project should describe anticipated vehicle use associated
           with operations and should provide strategies for reducing
           transportation-related impacts and local air pollution.
           Studies estimating air pollution from proposed uses of the
           project site, including associated vehicle travel, and of
           cumulative impact with adjacent Port uses should be
           performed and analyzed to increase perspective on die -
           potential air quaUty impacts of project
           A l l roof and pavement surfaces should have a solar
           reflectivity index in order to minimize the urban heat island
           effect
           In compliance with the City's Construction and Demolition
           ordinance, \OQVo of concrete and asphalt and a minimum of
           65% of all other materials generated should be targeted for
           reuse or recycling.


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17   PUBLIC, ACCESSIBLE OPEN   Project should demonstrate plan for publicly-accessible
     SPACE AT WATERFRONT       connection - by bicycle, foot, and vehicle - from Central
                               Gateway area to fiiture development of the 16.5-acre
                               shoreline open space mandated by the California State
                               Lands Commission and for coordination with the 15-acre
                               Gateway Park being developed by East Bay Regional Park
                               District to help create a world-class destination and
                               amenity.




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                                            EXHIBIT D
                                      Schedule of Performance
The Parties shall make all reasonable efforts to perform the following activities during the Negotiation
Period and within the time periods set forth herein below. All initial capitalized terms will have the same
meaning as in the Exclusive Negotiating Agreement

 No.                                  Task                                      Perfomiance time
  1.0 Developer (Including its members, partners and other entities Concurrently with execution of
      holding an equity interest in Developer) shall execute and           ENA.
      deliver Exhibit E (Campaign Contribution Umits Form) to
      Agency.
  2.0 Prior to the Execution of the ENA, the Developer worked with the Completed
      Port and the Agency to establish the baseline for the Trades
      Corridor Improvement Funds bond allocation, which now includes
      potential state and federal funding for projects within the East and
      Central Gateway Areas.

  2.1 Developer shall provide Agency with updates of the                    Throughout ENA period and within
      Conceptual Infrastructure Development Plan on a regular               15 days following an substantial
      basis until Developer submits to Agency a Final Infrastructure        modifications of the Plan.
      Development Plan.
  2.2 Should the Conceptual Infrastructure or Project plans omit the        Within 60 days of execution of
      15-acre OMSS site from its cun-ently approved location in the         ENA.
      East Gateway Area, Developer will submit a proposal for
      negotiating an alternative location that will ailpw continuity
      from this day forward of alternative truck parl<ing on the Army
      Base.
  3.0 Agency shall provide Developer all existing environmental,            Prior to and following the effective
      geological, engineering and other reports, contracts for              date of the ENA.
      services, and infrastructure design plans within the Agency's
      possession, including and not limited to documents procured
      under OBRA and stored offslte or known, or control pertaining
      to the Property, subject to Section 13 of the Agreement.

  3.1 Agency and Port shall develop a preliminary cost-sharing              90 days follovwng the effective date
      agreement consistent with the existing MOA and TCIF                   of the ENA.
      Project.
  4.0 Developer shall submit to Agency: A written statement                 Within 45 days of commencement
      detailing the status of any current or pending legal matters          of the Negotiation Period
      that might have a material impact on the planning,
      development or implementation of the Project Developer
      shall provide Agency copies of any litigation documents or
      filings in connection with such litigation within five (5) calendar
      days of Agency's written request Should any legal matter
      that might have a material impact on the planning,
      development or implementation of the Project arise during the
       Negotiation Period, Developer shall be obligated to disclose
      that information to Agency staff in writing viflthin five (5)
       business days after Developer or its partners become aware
      of such leqal matter.
  4.1 An organizational chart of the Developer Team.




                                                    Page 1




                                                                                                                   51 of 208
                                                                          MAJOR PROJECTS Tab 2.3


                                          EXHIBIT D
                                    Schedule of Performance

No.                                 Task                                     Performance Time
 4.2 Developer shall submit to Agency: A detailed written legal      Within 120 days of commencement
     structure of the proposed development team in a form that       of the ENA.
     reasonably satisfies Agency. This submission shall include a
     written description of the specific and genera! roles,
     responsibilities, and obligations of Developer, Developer's
     members or partners, and any other entity participating in the
     legal entity established by Developer for purposes of
     developing the Project The written description of roles,
     responsibilities, and obligations shall identify the principals
     and other personnel, to the extent identified, from each
     participating party by name,titieor position, and areas of
     responsibility within the development

 4.3 All documents related to the Developer's corporate, LLC, or
     partnership status, and Uie status of its members or partners,
     including but not limited to articles of incorporation, by-laws,
     partnership agreements, operating agreements, joint venture
     agreements, lists of members of board of directors and proof
     of good legal standing.
 4.4 The funding schedule for the entity to be formed under the
     Joint Venture demonstrating the capitalization oftineventure
     during the ENA.
 5.0 Developer shall submit to Agency a written proposal and a          Wltfiin 90 days following receipt of
     cost estimate of additional geological, engineering or other       Agency provided environmental,
     studies and/or design required for the development of an           geological, engineering and other
     infrastructure plan for the Property.                              reports and infrastructure design
                                                                        plans
 6.0 Developer shall retain environmental and professional design       Within 60 days of commencernent
     consultants, if necessary, to prepare an environmental site        of the Negotiation Period, the City,
     assessment, and all necessary environmental documentation          in its sole discretion, shall
     required to conduct environmental review under the California      determine the best approach for
     Environmental Quality Act (CEQA) for the Project                   obtaining CEQA and NEPA
                                                                        clearance to expedite
      Agency has the option of contracting directiy with CEQA           development, subject to
      consultants and requiring Developer to pay their fees. Except     consultation withtineDeveloper.
      as otherwise specifically provided for below, all environmental
      documents shall be prepared writhin the time periods required
      by CEQA.

 7.0 Developer shall submit plans and options for the location,     Within 240 days of commencement
     configuration, scale, and relationship of the proposed Project of Negotiation Period.
     for the OMSS Project, Produce Market, Film Center and
     JATC parcel as set forth in the RFP, all rail and other
     infrastructure improvements to be developed in connection
     with the development of the Property, buildings and other
     Improvements, circulation; and Project phasing.




                                                 Page 2




                                                                                                               52 of 208
                                                                             MAJOR PROJECTS Tab 2.3


                                           EXHIBIT D
                                     Schedule of Performance
No.                               Task                                      Performance Time
 8.0 Developer shall hold at least one public meeting in the        Within 135 days of commencement
     community to present its proposed Development Plan for the of the Negotiation Period
     construction of the Project. Developer shall hold up to tiiree
     such additional community meetings as reasonably required
     by tiie City and Agency and Developer shall be given a
     minimum of 15 days written notice of the same. [Agency
     recognizes that Developer has already participated in many
     community and stakeholder meetings and has agreed to work
     with some stakeholder groups in developing a community
     benefits agreement]

- 9.0 Developer shall develop a Project Description that is suitable      Within 60 days of commencement
      for review under the Califomia Environmental Quality Act            of the Negotiation Period
      (CEQA) as determined by the City of Oakland.
10.0 Developer shall obtain autiiorization to proceed with                Within 165 days of commencement
     environmental review of the Development Plan and Project             of the Negotiation Period
     Description from tiie Deputy Director of Redevelopment
11.0 Developer shall submit an "Application for Environmental             Within 15 days from approval of
     Review" to the City Planning Department for the development          Project Description by Agency.
     of the Property.
12.0 Developer shall submit to Agency: A detailed feasibility study       Prior to execution of the LDDA.
     of the potential reuse of existing warehouse structures (and/or
     salvage and reuse of building materials) as part of Uie Project

12.1 Developer shall submit to Agency: A plan for site preparation
     that addresses deconstruction of existing warehouse
     strictures (if applicable), environmental remediation,
     installation of utilities and other infrastructure, and other site
     preparation.
13.0 Developer shall submit to Agency: Detailed and itemized pro          Within 240 days of commencement
     formas that are linked to the schedule for construction and          of tiie Negotiation Period
     lease-up of Phase 1 of the Project The pro formas shall
     include a Project development budget, a statement describing
     the sources and uses of funds, a 20-year cash flow analysis,
     and an annotated operating budget to a level of detail
     reasonably acceptable to Agency.
13.1 A detailed development schedule for construction of Phase 1
     of the Project, which shall include consti"uction and absorption
     of tile Project's Phase 1 Industiiat, commercial, and retail
     spaces.
13.2 A preliminary Community Benefits plan developed in concert
     witii the Agency, the Alameda County Central Labor Council,
     NGOs and the Peralta Community College District with an
     immediate emphasis on workforce development and hiring for
     construction and operational phases of tiie proposed
     development
14.0 Developer shall submit all necessary and applicable zoning           Within 200 days following tiie
      permit applications and other land use permit applications for      development of the Project
     the Project to the City's Planning Department for processing.        Description suitable for
                                                                          environmental review.



                                                  Page 3




                                                                                                            53 of 208
                                                                         MAJOR PROJECTS Tab 2.3


                                         EXHIBIT D
                                   Schedule of Performance
No.                               Task                                        Performance Time
15.0 Developer shall engage an Appraiser, acceptable to the           Within 120 days of commencement
     Agency, to appraise tiie Fair Market Value of the Property.      of the Negotiation Period.

16.0 Developer shall obtain final appraisal from the Appraiser.      Prior to execution of tiie LDDA
17.0 For tiie purpose of Agency staff preparing a recommendation By the end of the Negotiation
     for the terms and conditions of a LDDA and Ground Lease,        Period ,
     the Developer shall submit all necessary information,
     including but not limited to:
17.1 Evidence of financing, including letters of intent and other
     commitments from lenders and equity partners, if any, to
     provide financing for the development of the Agency-
     approved Phase 1 of the Project
17.2 An updated and refined Project development budget
     statement describing sources and uses of funds, a 20-year
     cash flow analysis, and an annotated operating budget for the
     indusbial, commercial, and retail components of the Agency-
     approved Phase 1 of the Project to a level of detail reasonably
     acceptable to Agency.
17.3 A final plan for workforce development
17.4 With support from Agency staff, a Final Plan for the locations
     of Council-mandated operations, including the Produce
     Market, the Film Center, and JATC, as well as Pacific Coast
     Container.
18.0 Developer shall obtain cerb'fication of CEQA Envinsnmental       By the end of the Negotiation
     Review Documents by tiie lead agency for ttie proposed           Period as such Negotiation Period
     Project.                                                         may be extended pursuant to this
                                                                      Agreement




                                                Page 4




                                                                                                          54 of 208
                                                                                                         MAJOR PROJECTS Tab 2.3




         CONTRACTOR ACICNOWl^DGEMENT OF COT OF OAKLAND CAMPAIGN CONTRIBUTION L O ^                                                   Schedule 0




 Thisisan      Original    Revised form (dieck one). IforiginaL complete alltiiatapplies. If Revised, complete
 Contractor name and any changed data.



 Contractor Name                                                                          Phone                  -Jfeg-

 StrcctAddress              e<a^;.*4J&U=&»-A f t ^                     city      t ^ * - ^               , S t a t e . ^ Zip'^''ffe/'^'-


 Type of Submission (checkone)            Bid      ^Proposal     Qualification     ' - Amendment            A^^'?'*-^'-**-*'

 Majori^ Owner (if any). A majority owner is a person or entity who owns more than 50% of the contracting firm or
 entity.

bidividual or Business Name                                                               Phone

Street Address                                                         City                              State        Zip

The undersigned Contractor's Representative acknowledges by his or her signature the following:
               The Oakland Campaign Reform Act limits camp^gn contributions and prohibits contributionsfromcontractors
               doing business with the City of Oakland and the Oakland Redevelopment Agency during specified time periods.
               \^olators are subject to civil and criminal penalties.

               I have read Oakland Municipal Code Chapter 3.12, including section 3.12.140, the contractor provisions of the
               Oakland Campagn Reform Act and certify that I/we have not knowingly, nor will I Ave make contributions
               during the period specified in the Act

               I understand that the contribution restrictions also applytoentities/persons afBliated wift the contractor as
               indicated in the Oakland Municipal Code Chapter 3.12.080.

               If there are any changes to the mformation on this form during the contributioa-restricted tune period, I
               will file an amended form with the City of Oakland.



               Signatuf^                                              Date


              Print Name of Signer                                    Position

 3"                                         amplet
d ) l)^t^mnlete(r,By" iK^. of Oifcland' afferi:
"•i-", .*'=•'••'' .    •                • ' '• .


BSgiKtt^^niG&nftitadt^^                     ^
                                            -f                                               'A- ; i i




                                                                                                                                                  55 of 208
                                                                                          MAJOR PROJECTS Tab 2.3




      a^^^IKACTORACK>^0WLH3GEMENT OF C n y OF OAKLA>ro CAMPAIGN C O N T M                                                 Schedule 0




Thisisan     Original     Revisedform(i±ecfc one). Iforiginal, complete aU that applies. If Revised, complete
Contractor name and any diaoged data.



Contractor Name                                                                      Phone

Street Address                                                    City ^ A f i fiahJMggfetate C A " Z b


Type of Submission (checkone)        Bid      Proposal       Qualification     -Amendment            AfiJ^tK^fc-^jj^

Majority Owner (if any). A majority owner is a person or entity who owns more than 50% of the contractiogfirmor
entity.

Individual or Business Name                                                          Phone

Street Address                                                    City                      .State       .Zip

The unde^rsigned Contractor's Representative acknowledges by his or her signature the. following:
          The Oakland Campaign Keform Act limits campaign contributions and prohibits contributioosfromcontractors
          doing business with fte City of Oakland and the Oakland Redevelopment Agency during specified time periods.
          Violators are subjecttocivil and criminal penalties.

          I have read Oakland Municipal Code Chapter 3.12, including section 3.12.140, the contractor provisions of the
          Oakland Campaign Reform Act and certify that I/we have not knowingly, nor will I Ave make contributions
          during the period specified in the Act

          I understand that the contribution restricdons also applytoentities/persons affiliated with the contractor as
          indicated in the Oakland Municipal Code Chapter 3.12.080.

          If there are any changestotiieinformation ontfiisformduring &e contribution-restricted time period, I
           iflll file an amended form with the City of Oakland.



                                                                 Date


          Print Name of Signer                                   Position




                                                                                                                                       56 of 208
                                              MAJOR PROJECTS Tab 2.3




                  ATTACHMENT C
                  FIRST AMENDMENT TO

         EXCLUSIVE NEGOTIATING A G R E E M E N T

                         BETWEEN

THE O A K L A N D REDEVELOPMENT A G E N C Y AND A M B / C C G




                                                                57 of 208
                                                                   MAJOR PROJECTS Tab 2.3




     FIRST AMENDMENT TO THE EXCLUSIVE NEGOTIATING AGREEMENT
                AMB Property, L.P./CaIifomia Capital Group


        This First Amendment to the Exclusive Negotiating Agreement between the
Redevelopment Agency of the City of Oakland, and AMB Property, L.P./California Capital
Group, dated for reference as of January 22, 2010 ("First Amendment") is made and entered into
this 10*^ day of August 2010 ("Effective Date") by and between the REDEVELOPMENT
AGENCY OF THE CITY OF OAKLAND, a community redevelopment agency organized and
existing under the Califomia Community Redevelopment Law (the "Agency"), and AMB
PROPERTY, L.P., a Delaware Hmited partnership (AMB) and CALIFORNIA CAPITAL
GROUP, a California general partnership (CCG) and their successor in interest (collectively, the
"Developer") (together. Agency and Developer are referred to as the "Parties"), pursuant to
Agency Resolution No. 2010-0090 C.M.S, adopted on July 20, 2010.

                                         RECITALS

        A.     In January 2010, the Parties entered into an Exclusive Negotiating Agreement
(Agreement) to explore the possibility of redeveloping a portion the former Oakland Army Base
(the "Project"); and

       B.      New public utilities, streets, and other public infrastructure improvements are
required to serve the Project; and

      " C.     The estimated costs associated with constructing public infrastructure
improvements for the Project (e.g., pubhc utilities, streets and other public infrastructure
improvements; herein called "horizontal development") currentiy is estimated as two-thirds of
the total construction costs of the Project, with the remaining estimated one-third of costs
attributable to the construction of buildings, other development structures, and related
improvements (the *Vertical development") for the Project; and

       D.     Although an Environmental Impact Statement (EIS) was prepared in 2001under
the National Environmental Policy Act (NEPA), and an Environmental Impact Report (EER.) was
prepared in 2002 under the Califomia Environmental Quality Act (CEQA) with Supplemental
EIRs in 2006 and 2007, it is necessary to update NEPA and CEQA review for Project approval;
and

       E.     The Agency's abiUty to attract federal funding for horizontal development of the
Project depends on having the required NEPA review, which typically takes six to nine months,
or more, to complete; and

       F.     The Agency wishes to expedite obtaining CEQA and NEPA clearance to advance
horizontal development by, among other things, obtaining federal funds for the Project; and

        G.      The Agreement requires Developer to pay all costs of envirorunental compliance
for the Project; and

687059 1




                                                                                                   58 of 208
                                                                   MAJOR PROJECTS Tab 2.3




       H.     The Parties now wish to amend the Agreement to provide that the Agency shall
contract with a consultant to prepare required CEQA and NEPA documentation based on the
Developer's submitted Project Description, and to allocatetiiecosts thereof between the Agency
and the Developer;

       NOW THEREFORE, the Agreement is hereby amended as follows:

       I.     Schedule of Performance Item 6.0 is hereby deleted in its enthety and replaced
              with the following:

              Task 6.0. Agency shall retam LSA Associates, Inc. ("LSA") to prepare
              environmental documentation required under CEQA and NEPA based on
              Developer's Project Description that will be provided to LSA, as determined by
              tiie City.

              The contract with LSA shall be for an amount not-to-exceed $360,000. Agency
              will pay LSA the entire negotiated contract amount. However, the Developer shall
              timely reimburse the Agency for one-third of the negotiated contract amoimt.
              Agency's contribution shall be capped and shall not exceed two-thirds of the total
              not-to-exceed $360,000, for a maxmium contribution of $240,000.In addition, and
              without by way of limitation to its reimbursement obUgation to the Agency
              described above, Developer shall be responsible for dkectiy paying, at its sole
              cost and expense, all other costs of CEQA/NEPA review or other environmental
              related review required for the Project, including without limitation, 100% of
              LSA's work after the Agency's maximum contribution of $240,000 has been
              reached.

              Performance Time 6.0. Agency will execute a contract with LSA Associates
              within 30 days of execution of this First Amendment.

              Developer shall reimburse Agency within 30 days after receiving invoices from
              the Agency of the work performed by LSA.

        2.     The Parties hereby agree that, except as amended by this First Amendment, all
other terms, conditions, and provisions of the Agreement remain unchanged and in full force.

       3.      The persons signing this Agreement on behalf of Developer affirm that they are
authorized to execute on Developer's behalf

                                [Signatures on following page]




687059 1




                                                                                                   59 of 208
                                                                     MAJOR PROJECTS Tab 2.3




         IN WITNESS WHEREOF, tiiis First Amendment to tiie Exclusive Negotiating
Agreement between the Redevelopment Agency of the City of Oakland and AMB
Property, L.P. and Califomia Capital Group has been executed by the Parties as of the date
first written above.

DEVELOPER:

AMB PROPERTY, L.P.,
a Delaware Umited partnership

By: AMB PROPERTY CORPORATION,
a Maryland corporai




Dated:


CALIFORNIA CAPITAL GROUP,
a California gederal partnership




 Dated;         /0    (a '

AGENCY:

 REDEVELOPMENT AGENCY OF THE CITY OF
 OAKLAND, a community redevelopment agency
 organizi^ and existifigvunder the California
 Comn^nHv Redevelomnent Law

 By:
 Dan Lincmerm
 Agency Administrator

 Approved as to form and legality:


 Dianne Millner
 Agency Counsel




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                                                                   MAJOR PROJECTS Tab 2.3




                                    ATTACHMENT D

                                       TERM SHEET

                           SECOND AMENDMENT TO ENA

                                       March 15-2011


PURPOSE OF THE AMENDMENT

This Second Amendment to the January 19,2010, ENA between AMB/CCG
(Developer) and the Redevelopment Agency of the City of Oakland for
approximately 130 acres of the former Oakland Army Base (OAB) provides for the
additional time required to complete the ongoing CEQA process and negotiate the
final terms of an LDDA. It implements the steps necessary to proceed with the
design of the infrastructure of the entire OAB. It approves the Developer's
consultant team, budget, scope of services, and schedule; and it provides
$14,100,000 in Agency funding for that Developer's consultant team to do the
needed infrastructure planning. It also extends the term of the ENA for one year,
modifies the configuration of the area of the ENA, eliminates so of the formerly
mandated uses, and provides for more property management cooperation during
the infrastructure design phase. All other provisions of the ENA dated January 19,
2010, not specifically modified in the 2"^ Amendment survive intact.


EXTENSION OF TERM

Extend the term until the earlier of the approval of an LDDA, the termination of this
Agreement due a default or April 22, 2012. Should the entering into an LDDA be delayed
due to a delay in the Agency's approval of necessary CEQA approvals, and the
Developer not is otherwise in default, then this Agreement shall be extended until the
CEQA issue is resolved and the parties can enter into an LDDA or April 22, 2013,
whichever comes first. The ENA Exhibit D Schedule of Performance shall be revised to
extend the dates of required completion by an additional year and to reflect those
activities and requirements that have already been completed.

MASTER PLANNING AND INFRASTRUCTURE DESIGN AND FUNDING

It is the intent of the parties to work as a team, on a day to day basis, in the direction and
preparation of the master planning and infrastructure design. Towards that end both
parties commit to dedicate the staff and resources required to accomplish a design that is
satisfactory to parties, the Port, and the many regulatory agencies that will have some
jurisdiction over the project.




                                                                                                 61 of 208
                                                                MAJOR PROJECTS Tab 2.3




As called for in Item 5.0 of Exhibit D Schedule of Performance, the Developer has
submitted and Agency staff has reviewed a proposed team, budget, scope of services,
schedule, and sources of funding necessary for the preparation a master plan and
infrastructure improvement documents that will enable the construction of the
development.

   A. Approval of the Development Team

       Subject to subsequent modifications required as a result of mutually approved
       changes or as a result of necessary compliance with Agency, State, or federal
       funding requirements the development team as named in the RFQ response or the
       RFP response and as contained in Exhibit F Development Team has been
       reviewed in terms of qualifications and for consistency with Agency requirements
       and is approved

   B. Approval of the Design Budget

       Subject to subsequent modifications due to changes in the Scope of Work,
       approved change orders, regulatory requirements or other mutually agreed upon
       circumstances, the Master Planning and Infrastructure Design Budget, as
       represented in Exhibit G is approved. The Budget is based on a comprehensive
       approach to the OAB Infrastructure Master Plan and includes the planning for
       both the Agency and the Port portions of the OAB. Those portions of the Master
       plan which are solely Port-Oriented, specifically the Rail and 7* Street Overpass
       designs, are being performed pursuant to a Professional Services Agreement,
       attached to this Agreement as Exhibit K, the work of which is not to be begun
       until directed, in writing, to do so by Agency Staff Similarly, if directed by
       Agency staff, the Budget may be redirected away from the Port-oriented
       improvements to the planning of only'the Agency portions of the OAB and those
       portions of the OAB, and adjacent areas required for infrastructure improvements
       to serve the Agency's portion of the OAB.

   C. Approval of the Scope of Services

       The Scope of Services to be performed in the Master Planning and Infrastructure
       Design, as represented in Exhibit H, is approved

   D. Approval of the Schedule

       The Schedule for the Master Planning and Infrastructure Design is represented in
       Exhibit I. The Agency and developer agree to work in good faith to cooperate in
       performing the work and coming to agreement in a manner consistent with the
       schedule. The parties agree that time is of the essence and that a substantial delay
       by either party in producing documentation and timely review and approvals may
       be deemed a basis for default. Appended to Exhibit I. is a matrix of the various
       third party regulatory agencies to which the final approval of the Master Plan and




                                                                                              62 of 208
                                                           MAJOR PROJECTS Tab 2.3




   Infrastructure will be subject. Both parties acknowledge that there may be delays
   as a result of the review and approvals of these third party agencies that may be
   beyond the control of either party and will not be deemed a basis for default. Both
   parties agree to the maximum extent possible to coordinate their efforts in
   working with the outside agencies.

E. Agency Funding of Master Planning and Infrastructure Design

   1. The Agency has budgeted $ 16.3 million into a Joint Infrastructure
      Development Fund (JIDF), which is intended to be expended in conjunction
      with the Port of Oakland pursuant to a Cost Sharing Agreement. Pursuant to
      Exhibit G of this Second Amendment to the ENA, the Master Planning and
      Infrastructure Design Budget it is currently estimated that $14.1 million of the
      JIDF will be required to complete the work on the master plan and
      infrastructure design. The $14.1 million is the amount estimated to position
      the development for the commencement of construction. The Agency
      authorizes the expenditure of $14.1 million of the JIDF in conjimction with
      this Second Amendment to the ENA.

   2. During the Term of this Agreement, subject to the mutual agreement of
      authorized Agency staff and the Developer, budget allocations can be moved
      from one approved line item in Exhibit G to another, but at no time can the
      Agency's obligation exceed, the lesser of consultant work authorized and
      completed or $14.1 million, without the approval of the Agency. The Budget
      is based on a comprehensive approach to the OAB Infrastructure Master Plan
      and includes the planning for both the Agency and the Port portions of the
      OAB. The Port-oriented portions of the OAB, specifically the Rail and 7*
      Street Improvements will only precede if directed, in writing, to do so by
      Agency staff and the Port-oriented portions of the work will cease if so
      directed, in writing by the Agency staff.

   3. Agency funding will be to reimburse the Developer's third party costs only.
      No Agency funds will be used to pay developer fees, markups, administrative,
      or personnel costs. Agency funds will only be paid as reimbursements to the
      Developer's third party consultant costs consistent with the approved Exhibits
      F., G. and H., as they may be adjusted or amended. The Agency and
      Developer agree to follow the submittal, review and approval, reimbursement,
      and resolution of disputes procedures as outiined in Exhibit J.

   4. The Agency's funding obligation is limited to the infrastructure and grading
      development of the site including an application for a Tentative Map, the
      Final Subdivision Improvement Map, the Subdivision Improvements (public
      roadways, utility, and overall site grading) design criteria documents; and, in
      conjunction with the Port of Oakland pursuant to the Cost Sharing Agreement,
      the Rail and 7* street Improvements. The Developer shall be responsible for
      the cost of master planning of the vertical development aspects of the




                                                                                         63 of 208
                                                              MAJOR PROJECTS Tab 2.3




         project, including all buildings, all on-site improvements, including any on-
         site infrastructure improvements, other than rough grading, and any plaiming
         or building permit applications, including but not limited to a Specific Plan, a
         PD plan, design reviews, or building permits. Within 30 days of the execution
         of this Amendment, the Developer shall submit to Agency staff the consultant
         team, the scope, budget and schedule the Developer anticipates to use on its
         portion of the master planning and infrastructure design. To the extent there is
         any overlap of consultants, their contracts with those consultants shall be
         structured to clearly differentiate the work, costs, and invoicing for work that
         is the financial responsibility of the Agency and that which is the
         responsibility of the Developer.

     5. The Developer shall prepare and present monthly status reports to Agency
        staff for review and approval and, if requested, the Developer shall present the
        quarterly status reports to the Agency Board. The status reports shall
        summarize the progress of the planning with respect to the approved scope,
        schedule and budget. The monthly status reports shall also include the
        contractual and workforce percentages achieved in compliance with the
        Agency's goals

     6. In the event of a default by the Developer, that was not able to be resolved
        pursuant to the provisions of Section VI Disputes and Resolutions, the
        Agency shall in addition to any other remedy have the option of taking
        assignment of the contracts the Developer has entered into pursuant to Exhibit
        F.


REVISED ENA AREA AND COOPERATION REGARDING OTHER USERS
  A. The ENA area is revised to reflect Exhibit A, which adds the 15 acres in the Eastern
     Gateway area that had been previously excluded and tentatively deletes an estimated (?)
     acres of Central Gateway parcel G-2E.

  B. Up to 15 acres of the revised ENA area may need to be used for Truck Parking and
     Ancillary Uses in a location to be determined in the master planning process.

  C. Developer will cooperate with the Agency and with any other developer selected by the
     Agency to develop a Truck Operation in the master planning and development process.

  D. Developer acknowledges that the Agency has been approached by Caltrans regarding
     acquisition of a portion of the Central Gateway parcel G-2E for relocation of its
     Maintenance facility and agrees that any land contracted for by Caltrans is not subject to
     this ENA.

  E. Developer acknowledges that a regional Gateway Park is being planned by multiple
     agencies that will impact infrastructure and several development parcels within the ENA




                                                                                                  64 of 208
                                                                   MAJOR PROJECTS Tab 2.3




       area. The Developer agrees to cooperate with the Agency, in the master planning of the
       OAB, with respect to the Gateway Park planning process, in a manner that is mutually
       beneficial to both parties.

ELIMINATE CERTAIN PREVIOUSLY MANDATED USES

    The Agency and Developer hereby eliminate the requirement to accommodate
    certain specific uses as a part of the development, specifically the Produce Market,,
    and the Film center.


COORDINATION AGREEMENT

   A. Interagency Coordination

       The Developer and Agency agree that neither party shall conduct discussions or
       negotiations with any third party agency or business without notifying the other
       party, as soon as practical, and affording the other party the opportunity to
       comment on any communication and to participate in any meetings. In the event
       that in the ordinary course of work the Agency, the Developer , or any of their
       respective consultants, meets with a third party business or agency, without the
       participation of the other party, then the party that has any such contact shall
       provide the other party minutes and records of such meetings, within 2 days of the
       meeting.

   B. Property Management Coordination.

       The parties agree that the Agency will continue to have responsibility for
       management of the Property and that it is in the interests of both parties that the
       Agency strives to maximize revenue from its operation of the Property. The
       Agency agrees to notify the Developer regarding any activity that could impact
       the Developer's rights and responsibilities under this Second Amendment to the
       ENA. This obligation will, at a minimum, extend to all leasing activities, all
       import, export or management of on-site soil and recycled products, all ongoing
       maintenance, all demolitions, all environmental activities, even those underway or
       planned as a part of the ongoing RAP/RMP. The Agency will, having given
       notice of a pending activity, give the Developer 5 business days to respond. The
       Developer's response shall clearly state either it's concurrence with the proposed
       activity or its request that the parties meet and confer regarding the planned or
       pending activity. Should the Developer not respond, within 5 days, the Agency
       shall take the lack of a response as concurrence with the planned or pending
       activity? Should the parties meet and confer and not come to agreement regarding
       the planned activity

"Some terms subject to further negotiation with Developer; Negotiations will be finalized before
staff brings final form of SAENA to Agency Board for approval."




                                                                                                   65 of 208
                                                                      MAJOR PROJECTS Tab 2.3




                                           EXHIBIT D

                            S C H E D U L E OF P E R F O R M A N C E

                                     DRAFT VERSION 3-17-11

 [ N O T E : THIS DRAFT HAS NOT BEEN REVIEWED BY A G E N C Y SENIOR M A N A G E M E N T OR THE CITY
   ATTORNEY. IT IS PRESENTED ONLY TO RE-INITIATE DISCUSSION ON A NEW ORIENTATION TO
                   THE W O R K PLAN BETWEEN THE A G E N C Y , DEVELOPER, AND PORTl

The Parties shall make all reasonable efforts to perform the following activities during the
Negotiation Period and within the time periods set forth herein below to the extent permitted by
the schedule. All initial capitalized terms will have the same meaning as in the Exclusive
Negotiating Agreement. The performance time shall commence at the approval of the Second
Amendment to the Exclusive Negotiating Agreement.

                                                                             Performance
  No.                          Task                       Performance Time      Status
     1.0 Developer (including its members, partaers       Concurrently with Completed
         and other entities holding an equity interest    execution of ENA
         in Developer) shall execute and deliver
         Exhibit E (Campaign Contribution Limits
         Form) to Agency.
     2.0 Prior to the Execution of the ENA, the           Completed               Completed
         Developer worked with the Port and the
         Agency to establish the baseline for the
         Trade Corridors Improvement Funds bond
         allocation, which now includes potential state
         and federal funding for projects within the
         East and Central Gateway Areas.
 2.0 (b) Developer shall work with the Port and the       Prior to and            On-going
         Agency to seek and apply for federal funding     following the
         for projects within the East and Central         effective date of the
         Gateway Areas.                                   ENA.
     2.1 Developer shall provide Agency with              Throughout ENA          On-going
         updates of the Conceptual Infrastmcture          period and within       Official Updates:
         Development Plan on a regular basis until        15 days following       10/6/2009
         Developer submits to Agency a Final              any substantial         10/29/2009
         Infrastmcture Development Plan.                  modifications of        10/31/2009
                                                          the Plan.               12/7/2009
                                                                                  1/28/2010
                                                                                  3/1/2010
                                                                                  3/24/2010
                                                                                  4/15/2010
                                                                                  6/11/2010
                                                                                  7/7/2010


                                              Page 1




                                                                                                      66 of 208
                                                               MAJOR PROJECTS Tab 2.3




                                                                         9/16/2010
                                                                         10/15/2010
                                                                         11/15/2010
2.2 Should the Conceptual Infrastructure or          Within 60 days of   Completed
    Project plans omit the 15-acre OMSS site         execution of ENA.
    from its currently approved location in the
    East Gateway Area, Developer will submit a
    proposal for negotiating an altemative
    location that will allow continuity from this
    day forward of altemative truck parking on
    the Army Base.
2.3 Developer shall work with the Agency and         Prior to and          On-going
    its designated tmck facility developer in'the    following the
    planning of a new location for up to 15 acres    effective date of the
    of tmck parking and ancillary support            ENA.
    services within its ENA Area.
3.0 Agency shall provide Developer all existing      Prior to and          Completed
    environmental, geological, engineering and       following the
    other reports, contracts for services, and       effective date of the
    infrastmcmre design plans within the             ENA.
    Agency's possession, including and not
    limited to documents procured under OBRA
    and stored offsite or known, or control
    pertaining to the Property, subject to Section
    13 of the Agreement.
3.1 Agency and Port shall develop a preliminary      90 days following     On-going
    cost sharing agreement consistent with the       the effective date of
    existing MOA and TCIF Project.                   the ENA.
4.0 Developer shall submit to Agency: A written      Within 45 days of     Completed
    statement detailing the status of any current    commencement of
    or pending legal matters that might have a       the Negotiation
    material impact on the planning,                 Period
    development or implementation of the
    Project. Developer shall provide Agency
    copies of any litigation documents or filings
    in connection with such litigation within five
    (5) calendar days of Agency's written
    request. Should any legal matter that might
    have a material impact on the planning,
    development or implementation of the
    Project arise during the Negotiation Period,
    Developer shall be obligated to disclose that
    information to Agency staff in writing within
    five (5) business days after Developer or its
    partaers become aware of such legal matter.



                                        Page 2




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                                                              MAJOR PROJECTS Tab 2.3




4.1 Developer shall submit to Agency: An           Within 45 days of     Completed
    organizational chart of the Developer Team.    commencement of
                                                   the Negotiation
                                                   Period
4.2 Developer shall submit to Agency: A             Within 120 days of   Completed
    detailed written legal stmcture of the          commencement of
    proposed development team in a form that        the ENA
    reasonably satisfies Agency. This
    submission shall include a written
    description of the specific and general roles,
    responsibilities, and obligations of
    Developer, Developer's members or partaers,
    and any other entity participating in the legal
    entity established by Developer for purposes
    of developing the Project. The written
    description of roles, responsibilities, and
    obligations shall identify the principals and
    other persormel, to the extent identified, from
    each participating party by name, title or
    position, and areas of responsibility within
    the development entity.
4.3 A l l documents related to Developer's          Prior to execution
    corporate, LLC, or partnership status, and the of the LDDA
    status of its members or partaers, including
    but not limited to articles of incorporation,
    by-laws, partaership agreements, operating
    agreements, joint venture agreements, lists of
    members of board of directors, and proof of
    good legal standing.

4.4 The fimding schedule for the entity to be       Within 120 days of Completed
    formed under the Joint Venture                 commencement of
    demonstrating the capitalization of the        the ENA
    venture during the ENA.
5.0 Developer shall submit to Agency a written      Within 90 days of    Completed.
    proposal of additional geological,             commencement of       See Exhibit H
    engineering or other studies and/or design     the ENA
    required for the development of an
    infrastructure plan for the Property.
5.1 Developer shall submit to Agency written        Within 90 days of    Completed.
    cost estimates for each of the geological,     commencement of       See Exhibit G
    engineering and other studies and/or design    the ENA
    required for development of an infrastmcture
    plan for the Property.




                                        Page 3




                                                                                         68 of 208
                                                                 MAJOR PROJECTS Tab 2.3




5.2 Developer shall submit to Agency schedules         Within 90 days of     Completed.
    for each of the geological, engineering and       commencement of        See Exhibit I
    other studies and/or design required for          the ENA
    development of an infrastmcture plan for the
    Property.
5.3 Agency shall approve and appropriate funds        Within 15 days of
    for each of the geological, engineering and       the submittal of the
    other smdies and/or design required for           Developer's
    development of an infrastructure plan for the     proposal
    Property and reimburse the Developer's
    third-part costs per the Payment Procedures
    outlined in Exhibit J.
6.0 Developer shall retain environmental and        Within 60 days of        Amended by
    professional design consultants, if necessary, commencement of           Amendment 1.
    to prepare an environmental site assessment    the Negotiation
    and all necessary environmental                Period, the City, in      Environmental
    documentation required to conduct              its sole discretion,      and professional
    environmental review under the Califomia       shall determine the       design
    Environmental Quality Act (CEQA) for the       best approach for         consultants
    Project.                                       obtaining CEQA            retained by
                                                   and NEPA                  Agency.
    Agency has the option of contracting directly clearance to               Environmental
    with CEQA consultants and requiring            expedite                  review on-going.
    Developer to pay their fees. Except as         development,
    otherwise specifically provided for below, all subject to
    environmental documents shall be prepared      consultation with
    within the time periods required by CEQA.      the Developer.

7.0 Developer shall submit conceptual plans and       Within 240 days of     Completed
    options for the location, configuration, scale,   commencement of
    and relationship of the proposed rail and         the Negotiation
    other infrastmcture improvements to be            Period.
    developed in connection with the
    development of the Property, buildings and
    other improvements, circulation, and Project
    phasing.




                                         Page 4




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                                                                   MAJOR PROJECTS Tab 2.3




 8.0 Developer shall hold at least one public           Within 135 days of    36 Meetings
     meeting in the community to present its            commencement of       Completed to
     proposed Development Plan for the                  the Negotiation       Date
     constmction of the Project. Developer shall        Period
     hold up to three such additional community
     meetings as reasonably required by the City
     and Agency and Developer shall be given a
     minimum of 15 days written notice of the
     same [Agency recognizes that Developer has
     already participated in many communify and
     stakeholder meetings and has agreed to work
     with the Agency in developing a community
     benefits agreement!.
 9.0 Developer shall develop a Project                  Within 60 days of     Completed
     Description that is suitable for review under      commencement of
     the Califomia Environmental Quality Act            the Negotiation
     (CEQA) as determined by the City of                Period
     Oakland.

10.0 Developer shall obtain authorization to            Within 165 days of    Completed
     proceed with environmental review of the           commencement of
     Project Description from the Deputy Director       the Negotiation
     of Redevelopment.                                  Period
11.0 Agency shall submit an "Application for            Within 15 days        Completed
     Environmental Review" to the City Planning         from approval of
     Department for the development of the              Project Description
     Property.                                          by Agency.


12.0 Developer shall submit to Agency: A                Prior to execution
     detailed feasibility study of the potential        of the LDDA.
     reuse of existing warehouse stmctures
     (and/or salvage and reuse of building
     materials) as part of the Project.
12.1 Developer shall submit to Agency: A plan           Consistent with the
     for site preparation that addresses:               schedule included
     deconstmction of existing warehouse                as Exhibit I
     stmctares (if applicable), environmental
     remediation, installation of utilities and other
     infrastructure, and other site preparation.

13.0 Developer shall submit to Agency: Detailed Prior to execution
     and itemized pro formas that are linked to the of the LDDA
     schedule for constmction and lease-up of
     Phase 1 of the Project. The pro formas shall
     include a Project development budget, a


                                           Page 5




                                                                                             70 of 208
                                                                       MAJOR PROJECTS Tab 2.3




           statement describing the sources and uses of
           ftmds, a 20-year cash flow analysis, and an
           annotated operating budget to a level of
           detail reasonably acceptable to Agency.
    13.1   Developer shall submit to Agency: A              Prior to execution
           detailed development schedule for                of the LDDA
           constmction of Phase 1 of the Project, which
           shall include constmction and absorption of
           the Project's Phase 1 industrial, commercial,
           and retail spaces.
    13.2   Developer-shall submit to Agency: A              Within 240 days of    Completed
           preliminary Community Benefits funding           commencement of
           plan developed after consulting with the         the Negotiation
           Agency, the Alameda County Central Labor         Period
           Council, NGOs and the Peralta Community
           College District, with an immediate emphasis
           on workforce development and hiring for
           constmction and operational phases of the
           proposed development.
    13.3   Agency and the Developer shall negotiate a       Prior to execution
           Community Benefits Agreement, to be part         of LDDA
           of the LDDA, which includes an immediate
           emphasis on workforce development and
           hiring for constmction and operational
           phases of the proposed development.
'   14.0   Developer shall submit all necessary and         Consistent with the
           applicable zoning permit applications and        schedule included
           other land use permit applications for the       as Exhibit I
           Vertical Project to the City's Planning
           Department for processing.
    15.0   Developer shall engage an Appraiser,             Within 120 days of    Proposal
           acceptable to the Agency, to appraise the Fair   commencement of       Submitted
           Market Value of the Property.                    the Negotiation       6/1/2010,
                                                            Period.               Awaiting
                                                                                  Agency
                                                                                  Approval
    16.0 Developer shall obtain final appraisal from        Prior to execution
         the Appraiser.                                     of the LDDA

    17.0 For the purpose of Agency staff preparing a By the end of the            Completed
         recommendation for the terms and conditions Negotiation Period
         of a LDDA and Ground Lease, the Developer
         shall submit all necessary information,
         including but not limited to:



                                              Page 6




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                                                                MAJOR PROJECTS Tab 2.3




17.1 Evidence of financing, including letters of      By the end of the    Completed
     intent and other commitments from lenders        Negotiation Period
     and equity partners, if any, to provide
     financing for the development of the
     Agency-approved Phase 1 of the Project.
17.2 An updated and refined Project development       By the end of the    Completed
     budget statement describing sources and uses     Negotiation Period
     of fimds, a 20-year cash flow analysis, and an
     annotated operating budget for the industrial,
     commercial, and retail components of the
     Agency-approved Phase 1 of the Project to a
     level of detail reasonably acceptable to
     Agency.
     Evidence of financing, including letters of
     intent and other commitments from lenders
     and equity partaers, if any, to provide
     financing for the development of the
     Agency-approved Phase 1 of the Project.




                                         Page 7




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                                                                                 MAJOR PROJECTS Tab 2.3




                                                        Exhibit F

               Proposed O A B M a s t e r Planning, Design W o r k , and Regulatory Approval T e a m




            Proposed O A B M a s t e r Planning, Design Work, and Regulatory Approval Team
                                                                                 LBE     SLBE     MBE      WBE
Program
    Architectural Dimensions                Program Management                    ,x
    Turner Construction                     Program Team Administration           X
    Acumen Building Enterprise, Inc         Scheduling                            X
Design
    AECOM                                   Master Electrical System Planning     X
    Acumen Building Enterprise, Inc         Master Electrical System Planning     X
    Tucker Technology                       Master Electrical System Planning     X
    BKF Engineers                           Structural Engineering                X
    McLarand Vasquez Emsiek & Partners      Planning Design Services              X
    First American Title Company            Title Work
    Berlogar Geotechnical Consultants       Geotechnical Work
    BKF Engineers                           Road Planning
    Jacobs Engineering Group, Inc.          7th Street Design
    BKF Engineers                           7th Street Structural Peer Review
    BKF Engineers                           Traffic Planning
    Industrial Railways Company             Rail Design
    AECOM                                   Rail Design Peer Review
    Kennedy/Jenks Consultants               Utilities Planning
    PGAdesign Inc                           Landscape Design
    Ruggeri-Jensen-Azar                     Survey and Parcel Map
    Ruggeri-Jensen-Azar                     Grading and Drainage
Contractors
    Top Grade Construction                  Pre Construction
    Flatiron West Inc                       7th Pre Construction
Admin
    Law Office of Mark Stice                Legal Services
    Finlayson/Williams Adiey                Accounting/Audit
                                                                                68.42%   21.22%   10.92%   2.81%



   On-Call Contracts                                     LBE   SLBE    MBE      WBE
   TransSy stems                                          X
   HDR Engineering, Inc.
   URS Corporation                                        X
   Treadwell Rollo                                        X
   Dahlin Group
    MACTEC Engineering and Consulting, Inc.               X
    Innovative and Creative Environmental Solutions *
    Northgate Environmental Management Inc.*              X

     -- Environmental costs not included in the $14.1 million budget




                                                                                                                   73 of 208
                                                                       MAJOR PROJECTS Tab 2.3




                                             Exhibit G
              OAB Master Planning, Design Work, and Regulatory Approval Budget


                       Surveys, Mapping, and Planning       $2,541,888
                                   Demolition Planning        $112,142
                       Soils/Grading/Materials Handling     $2,048,462
                         Power Gridrrelecom Planning        $1,495,228
                                      Rail Yard Design*       $598,091
                                     7th Street Design*     $3,252,121
                       Public Roads & Utilities Planning    $4,052,068
                                                           $14,100,000 TOTAL
                       * Port-oriented projects


Note: Necessary environmental remediation activities not included in the $14.1 million budget




                                                                                                74 of 208
                                                                                      MAJOR PROJECTS Tab 2.3


                                                      Exhibit H
           Proposed OAB Master Planning, Design Work, and Regulatory Approval Scope

Program Management and Team Building
The program management team members will ensure coordination of the consultants' efforts to produce the
deliverables required for the approval of an infrastructure master plan and design bridging documents. The
program management team will also include legal support and auditors to ensure compliance with local, state, and
federal reporting requirements.

Surveys, Mapping, and Planning
In addition to the coordination of the necessary title work, the planning team will undertake the surveys and
mapping necessary for the characterization of the property and the creation of a tentative map and specific plan.

Demolition of Existing Buildings, Wharf
The demolition team will conduct a structural assessment of the existing buildings and a plan for their
deconstruction. They will produce plans for the temporary relocation of existing tenants, the preservation of
historic elements, the environmental characterization of the materials, and the deconstruction of the buildings are
necessary. Also performed will be a structural assessment of the existing wharf in the West Gateway, and, if
necessary, the creation of a plan for its deconstruction.

Materials Handling (Import and Surcharging, Rough Grading)
The materials handling consultants will monitor the importing and surcharging of soil, necessary to avoid
differential settlement issues, and develop associated handling procedures and a SWPP Plan, as well as investigate
other potential remedies for the soil issues on the site. After the surcharging program, the sites will be rough-
graded to the appropriate level determined by the soils team.

Power Grid
Future Port developments, including Shore Power and the electrification of the Outer Harbor Marine Terminal, will
require study and coordination with the OAB power grid. It is also a goal of the City, Port, and Developer to make
the development a green, sustainable project. The consultants will study how to address these issues in
coordination with the vertical development team.

Rail Yard and Marine Terminal Connection
An independent rail yard will be the centerpiece of the Outer Harbor Intermodal terminal horizontal infrastructure
program. This yard and its connection to the Outer Harbor marine terminals will enable the future expansion of
the Port of Oakland to become a "first call" port. The rail yard consultants will explore design alternatives for the
proposed rail yard to ensure the efficient use of space and the maximization of revenue. Coordination of the rail
yard plans with the vertical development will be a key component of their efforts.

7th Street Grade Separation
It is proposed that 7^^ Street be elevated above the rail lines to allow future connection of the OHIT independent
rail yard to the existing rail facilities. This will improve traffic flow within the Port, enhance air quality, and separate
pedestrians and bicyclists heading to Middle Harbor Shoreline Park from the Port truck traffic. The $3.4 million
prescribed during this phase for the 7'^ Street project should provide a level of planning necessary to coordinate its
development with the proposed OAB improvements and attract federal funding to finish the design.

Roads and Utilities
Maritime Street and Burma Road are in need of replacement, and the existing utility systems across the base are
failing. Replacing and realigning the roads will allow for better traffic flow within the Port, enable the upgrading of
the utility systems underneath, and provide access to the future Gateway Park. New utility systems that meet
current green standards and can handle the proposed density of the new development are necessary. The
consultants will determine the best roadway and utility corridor alignments and designs to meet these goals.




                                                                                                                               75 of 208
                                                                                                                                                                                              MAJOR PROJECTS Tab 2.3


                                                                           EXHIBIT I: OAKLAND ARMY BASE
                                                                           PROPOSED DELIVERY SCHEDULE
                                                                                        3/14/11
 ID          iTask Name                                                                         Duration              Start               Finish           2011            2012               12013                   2014     12015
                                                                                                                                                       tL.Ur,LtrJ_tr_Ltr_ J L l J l L U U . t U J r T t M j ; [ J j t ^
             •TCfrAL HORIZONTAL PROJECT                                                         14S0 days,          T u e 4 / 5 / l l i Thu 4/23/15      4/3 y       Ml- =                        s = s s s - s s s ^ = s u      m i ^ 4/23


             I    OTY ENA APPROVAL                                                                   0 days          Tue 4/5/11\         Tu e 4/5/11

                  a i Y ENA DURATION                                                              365 days'          Tue 4/5/11:,        Tue4/3/l2

                  OTY E N A E X T E N a O N                                                       180 days          W e d 4 / 4 / l 2 i Sun 9/3,0/12

                  LDDA                                                                            ISO days        Mon l/30/12            Fri 7/27/12

                  DROP DEAD TO START CONSTRUGnON FOR TCIF                                            Odays        Tue 10/15/13 T u e l o 7 l 5 / l 3

                  DROP DEAD to USE UP CHUBB MONEY                                                    Odays          Wed8/7/13: WedS/7/13

                  LAUNCH TEAM CONTRACTS                                                             30 days          T u e 4 / 5 / l l i Wed 5/4/11

                  MANAGEMENT CH" PROJECT                                                        1450 days          W e d 5/4/11; Thu 4/23/15                                                                                       ^.4/23

 10                    : F ^ N N i N G DESIGN SERVICES                                            420.daysl        W e d 5/4/11 W e d 6/27/12

                            Key Dates                                                             420 days         W e d 5 / 4 / l l V V a d 6/27/12

 16                         PARCEL M A P                                                          420 days          Thu 5/5/11 W e d 6/27/12

 22                        rSPEoTlCPLAN                                                           240 days         Tue l l / l / l l W e d 6/27/12

 26                                                                                               270 days          Thu 5/5/11^ Sun 1/29/12
                            EIR RATIFICATION,
:30                                                                                               420 days          Thu 5/5/11 W e d 6/27/12
                            VERTICAL PLAN
 35                                                                                               420 days          Thu S / S / l l W e d 6/27/12'
                            IN"FRASTRUCTUREPLAN
 43                                                                                              1210 daysi         Thu 5/5/11: Tiie 8/26/14
                       HOT.HORIZONTAL PROJECTS
 44                         Remediation Project                                                   800 days          Thu 5/5/11;          Frl 7/12/13
                                                                                                              I                      i
 45                              ONGOING R A P / R M P Remediation
                                                                                                  800 days           Thu 5 / 5 / l l j   Fri7/12/13
 46                         Pursuit of Unfound HazMat
                                                                                                  510 days         Thu 5/5/11 Tue 9/25/12-
 54                         Construction                                                          700 days        Wed 9/26/12! Tue 8/26/14



                                          Task                                          Milestone                                          External Tasks
Project 3.14.11 ENAExhlbitl                                                             Summary                                            Extemal Milestone
                                          Spilt
Date: Men 3/11/11
                                          Progress                                      Project Summary ^}                                 Deadline            O

        This schedule representsa series of concurrent tasks that may affect the start and completion dates of the project It Is hat final but Is intended to reflect the logic and general flow of a sampling of key milestone tasks.
                                                                                                                 Page 1




                                                                                                                                                                                                                                              76 of 208
                                                                                                                                                                                                      MAJOR PROJECTS Tab 2.3



                                                                              EXHIBIT I: OAKLAND ARMY BASE
                                                                              PROPOSED DELIVERY SCHEDULE
                                                                                           3/14/11
 ID             Task Name                                                                          Duration                Start             Finish !2D11               12012            12013               2014             2015
                                                                                                                                                 ir [ tf i Ir I If I ir 1 ir 1 ir j tr I tr I IT I tr I Ir Mr Mr I Ir I Ir I tr Ir j Ir Mr i tr
 55                              Soils/Gradihg/Materials Handling                                    330 days'           Thu 5/5/11; Thu 3/Z9/12           5
                                                                                                                                                     5/5 ( =               ^9 3/29
                                                                                                                1
                                 Construction                                                                            Fri 3/30/12; Tliu 2/27/14                         3/30                                                 2/27
                                                                                                       700 days]
                                 Demolition of>Warehouses                                                                T h u 5 / 5 / l l | Sat 4/28/12     5/E <^                      4/26
                                                                                                     360 days!
 69                                                                                                                                                               i         4/29                   10/25
                                 Construction                                                          180 days;     Sun 4/29/12 Thu 10/25/12
                                                                                                                                                                                                      i
 70                                                                                                                      Thu 5/5/11; Thu 4/23/15           15/5 (^i                                                                               4/23

 71                                                                                                                      Thu 5/5/11 Tue 12/24/13           js/s ^                                                       ^     12/24

 72                                  HORIZONTAL TEAM                                                 450 days            Thu 5/5/11       Fri 7/27/12      15/5 ^                        ^     7/27

 75                                  DESIGN/BUILD PROCESS                                            315 days         Sat 7/28/12           Fri 6/7/13                            7/28
                                                                                                                i
 80                                  Construction                                                                                                                                                          6/S          ^ 12/24
                                                                                                   "200 day?              Sat 6 / 8 7 i 3 ^ f u G 2 4 A                                                                  I
 81                              RailYard                                                                                                                  .5/5        ^                                                ^ 12/15
                                                                                                     956 daysl           Thu 5 / 5 / l l S u n 12/15/13
 82                                  HORIZONTAL TEAM                                                                                                                                         • 7 B/26
                                                                                                     480 days            Thu 5/5/11 Sun 8/26/12
 85                                  DESIGN/BUILD PROCESS                                                    i                                                                     a/27 ^ ;           •           2!
                                                                                                     276 days!       Mon 8/27/12 Wed 5/29/13
 •go                                 Construction                                                    lOOdays^        Thu 5/30/13 Sun 12/15/13                                                             5/30              112/15

                                 7th Street'                                                       1450 days!            Thu 5/5/11, Thu 4/23/15           ISIS: ^                                                                            V   4/23

 92                                  HORIZONTAL TEAM                                                 540 days!           Thu 5 / 5 / i i rhu 10/25/12      ' 5IS       ^                        • 9 10/25
                                                                                                             i
"95"                                 DESIGN/BUILD PROCESS                                                            Fri 10/26/12Wed 3/19/14                                        10/26         ^                              3/19
                                                                                                     510 days!
Too"                                 Construction                                                                    Thu 3/20/141 Thu 4/23/15                                                                           3/20                      4/23
                                                                                                     400 days|
 101                             Roads                                                                                   Thu 5 / 5 / i r Thu 5/29/14       [5/5 qj*                                                              ^     5/29
                                                                                                   1121 days
 102                                 HORIZONTAL TEAM                                                         1 Thu S/S/11^ Sun 8/26/12                                            i^^^           8/26
                                                                                                     480 days!
 105                                                                                                         I                                                                                        i
                                     DESIGN/BUILD PROCESS                                                      Mon 8/27/12 Wed 5/29/13                                             a/27                          |r2!
                                                                                                     276 days;
 110                                 Construction                                                    365 days;       Thu 5/30/13 Thu 5/29/14                                                              5/30                        5/29



                                               Task                                        Milestone           O                             Extemal Tasks             E
Project: 3.14.11 ENA Exhibit I
                                               Split                                       Summary                  ^=                       Extemal Milestone O
Date: Mon 3/14/11
                                               Progress                                    Projed Summary                                    Deadline                 <^

          This sctiedule represents a series of concun^nt tasks that may affect the start and completran dales of the project. It is not final but is intended to reflect the logic and general flow of a sampling of key milestone tasks.
                                                                                                                    Page 2




                                                                                                                                                                                                                                                         77 of 208
                                                                       MAJOR PROJECTS Tab 2.3




                                             EXHIBIT J
                                OAB/ENA Phase II Payment Procedures

1. Acceptance of Cash Flow Budget
          Within fifteen (15) calendar days of the execution of the extension of the ENA,
          Developer shall provide the ORA/City the following:
                     i.   An initial projected monthly payment schedule and work schedule,
                          generally consistent with the approved ENA Budget and Schedule, shall
                          be submitted for the ORA/City Staff for its review and written approval.


          Within sixty (60) calendar days of the execution of the extension of the ENA, Developer
          shall provide the ORA/City the following:
                     i.   A final projected monthly payment schedule and work schedule,
                          generally consistent with the ENA Budget, Scope, and Schedule shall be
                          submitted to the ORA/City Staff for its review and written approval.

Note: Proposed invoicing schedule:
a.   Consultants submit invoices on contracts to CCG no later than the 5*^ day of each month;
b. CCG has fifteen (15) working days to approve/dispute in writing;
c.   CCG pay subcontractor on undisputed invoices (or undisputed portion thereof) within
     twenty (20) business days of date of approval/deemed approval;
d. CCG submits approved invoices to City no later than the 25^^ day of each month;
e.   City has fifteen (15) working days to approve/dispute in writing;
f.   City pays CCG on undisputed invoices (or undisputed portion thereof) within twenty (20)
     business days of date of approval/deemed approval.


     2.   Initial acceptance of Vendor and Scope
                 Within thirty (30) calendar days of the execution of the extension of the ENA,
                 Developer shall provide the ORA/City the following:
                     i.   Copy of proposed Vendor contract (in a form previously approved by
                          ORA/City) inclusive of scope and schedule
                    ii.   Copy of Vendor City business license
                   iii.   Copy of Certificate of Insurance from Vendor confirming required
                          insurance and naming ORA/City and CCG as additional insureds on the
                          Commercial General Liability policies only
                   iv.    Vendor's Tax ID info
                   V.     CCG's Notice compliance with Federal contracting procedures
                  vi.     Vendor's Statement and declaration of conflict of interest
                  vii.    Proof of CCG's compliance local hire business requirements




                                                                                                     78 of 208
                                                                       MAJOR PROJECTS Tab 2.3




3.   Performance Schedule
                   i.   The overall coordinated performance schedule shall be concluded within
                        Fifteen (15) calendar days of the acceptance, approval, and execution of
                        all of the Vendor contracts in 2.1 and shall be submitted to ORA/City Staff
                        for its review and approval.


4. Approval of Contract Modifications
                   i.   Upon satisfaction of Section 5(ii) below, CCG may without the A g e n c / s
                        prior consent amend a Vendor Contract to increase the Contract Price
                        paid there under by an amount not to exceed $24,999 per Vendor
                        Contract. Any change order or combination of change orders to any
                        Vendor cannot exceed $24,999 without the written consent of ORA/City
                        Staff. The Agency shall not unreasonably withhold its consent to CCG's
                        request to amend a Vendor Contract. CCG shall have the right to request
                        such consent at the weekly meetings and ORA/City Staff shall have five
                        (5) business days to review and approve in writing any such request. The
                        Budget shall be revised monthly to reflect all changes to Vendor
                        Contracts and the impact of that changes on a line item contingency or
                        the Contingency.


5.   Payment Procedure
     Monthly the Developer shall:
              i.        Collect Invoices from Vendors by the 5**^ calendar day of the month
             ii.        Approve/dispute such invoices by the 15^^ working day after receipt
                        thereof
            iii.        Submit undisputed invoices (or portions thereof) to the City by the 25*^
                        day of each month. Such invoices shall be accompanied by all items
                        required by the Vendor Contract [Payment Request Sheet, lien waivers
                        from Vendor and sub-consultants, local hire compliance (if applicable),
                        evidence of required insurance (initial invoices only), and W-9 w / tax ID
                        (initial invoice only)], CCG's certification that it has approved the prior
                        work (if applicable) and the requested percentage completion and copy
                        of project checking account register.
            iv.         Provide any Record(s) of Negotiation for any changes from previously
                        agreed contracts (see 4.1)
             V.         Review the submittal with the Agency representative at the next weekly
                        meeting




                                                                                                      79 of 208
                                                           MAJOR PROJECTS Tab 2.3




       vi.    Pay Vendors for the full amount of undisputed invoices (or undisputed
                                                                                         T
              portions thereof) within 20 working days after approval/deemed
              approval


The Agency shall:
         i.   Approve/dispute submittal within fifteen (15) working days after receipt
              thereof
        ii.   Submit request to ORA/City for payment to CCG for the full amount of
              undisputed invoices (or undisputed portions thereof) within five (5)
              working days after approval/deemed approval
       iii.   The ORA/City shall process the submitted request for payment in
              accordance with its established policies in Chapter 2.06 of the Oakland
              Municipal Code




                                                                                             80 of 208
                                                                MAJOR PROJECTS Tab 2.3




                                        Exhibit K
Professional Services Agreement for Master Planning, Design Work, and Regulatory Approval of
                                    Port-Oriented Projects




                                                                                               81 of 208
                                                                   MAJOR PROJECTS Tab 2.3

                                                                               Approved as to form and legality


       ,,, ,,, ; LELOAKLAND                   CITY COUNCIL                       0 ikue^
               0_f^TME CIT      pf
                               n^                                                                  City Attorney
        onnu.        f^i'sOLUTION N o .                           _C.M.S.



       RESOLUTION AUTHORIZING:

       (1) THE CITY ADMINISTRATOR TO NEGOTIATE AND EXECUTE AN
       EXCLUSIVE NEGOTIATING AGREEMENT BETWEEN THE CITY OF
       OAKLAND AND AMB PROPERTY CORPORATION/CALIFORNIA CAPITAL
       GROUP (AMC/CCG) FOR A DEVELOPMENT ON THE FORMER OAKLAND
       ARMY BASE WITHOUT RETURNING TO CITY COUNCIL; AND

       (2)  A WAIVER OF THE ADVERTISING AND REQUEST FOR
       PROPOSAL/QUALIFICATIONS PROCESS AND AN AWARD OF THE
       PLANNING AND DESIGN OF INFRASTRUCTURE IMPROVEMENTS FOR
       THE PORT-ORIENTED RAILYARD AND 7^" STREET OVERPASS WORK, IN
       AN AMOUNT NOT-TO-EXCEED $3,850,212, TO AMB/CCG

        WHEREAS, the Redevelopment Agency of the City of Oakland ("Agency") owns parcels
of the former Oakland Army Base ("Base"); and

        WHEREAS, the City of Oakland ("City") may assume ownership of the Agency's Base
properties, including the assumption of assets and liabilities associated with the economic
redevelopment of the property; and

        WHEREAS, the Agency adopted Resolution 2010-0088 C.M.S, authorizing the
establishment of the Army Base Joint Infrastructure Development Fund in the initial amount of
$ 16,3 00,000 specifically for the development of infrastructure on the Base; and

       WHEREAS, the Agency has been awarded a $2,000,000 TIGER II grant from the U.S.
Department of Transportation, $1,600,000 of which will go directly towards infrastructure planning
and design for the Base, with a match requirement of up to $3,010,000; and

       WHEREAS, the Oakland Army Base Reuse Plan and 2002 Environmental linpact Report
document the need to install all new public-utilities and streets to serve new development of the
former Oakland Army Base; and

        WHEREAS, the Request for Proposals issued by the Agency that subsequently led to the
selection of AMB Property Corporation/California Capital Group (AMB/CCG) clearly articulated
the expectation that the master developer would be responsible for all aspects of the development of
the Army Base site including site planning, engineering, and other pre-development activities; and

       WHEREAS, on January 19, 2009, the Agency executed an Exclusive Negotiating
Agreement (ENA) with AMB/CCG for the potential redevelopment of a portion of the former Army
Base identified as the Gateway Development Area and which included all of the Central and West
Gateway Areas and part of the East Gateway Area; and

       WHEREAS, extensive planning and design work for areas outside the ENA Development

                                                                                                              82 of 208
                                                                     MAJOR PROJECTS Tab 2.3

Area is required for the planning and design of the ENA Development Area; and

       WHEREAS, the infrastructure improvements for the Port-oriented Railyard and 7"* Street
Overpass are not essential to the planning and design of the ENA Development Area but are
necessary to preserve the $242,000,000 in Trade Corridor Improvement Funds (TCIF) which were
awarded to the Port of Oakland but may be lost if the Railyard and the 7'^ Street Overpass are not
designed in a timely manner; and

       WHEREAS, the Amended and Restated Memorandum of Agreement between the Agency
and the Port contemplates a unified approach to the design of the Army Base; and

        WHEREAS, the Cost Sharing Agreement pending between the Agency and the Port calls
for the Agency to invest $14.1 million toward the design of the entire Army Base, including the
Railyard and the 7"^ Street Overpass, in exchange for the Port supporting a $62,000,000 allocation of
the TCIF award for infrastructure development in the Agency-owned portion of the Base; and

        WHEREAS, planning and design work that is not essential to the ENA Development Area
should be awarded pursuant to the City's purchasing processes - advertising and request for
proposal/qualifications requirements, unless the City Council determines that it is in the City's best
interests to waive such these processes; and

        WHEREAS, the ENA required AMB/CCG to propose a Development Team, Scope,
Schedule, and Budget for the plarming and design work required for the construction of
infrastructure, public utilities, and public streets on the former Army Base; and

       WHEREAS, AMB/CCG has submitted the required proposal that includes a Budget of
$14,100,000 for master plarming public infrastructure improvements for the former Army Base; and

      WHEREAS, the Budget includes $3,850,212 for the planning and design of infrastructure
improvements for the Port-oriented Railyard and the 7^' Street Overpass; and

        WHEREAS, Joint Infrastructure Development Fund (9572), Infrastructure Master Plan
Project (S415820) is currently used as the source of TIGER II match funding; and

        WHEREAS, AMB/CCG's proposed Development Team is ready to begin preparing
infrastructure planning and design documents for the Army Base and use of this Development Team
is the surest and most timely way to accomplish the work and meet state and federal funding
deadlines; and

       WHEREAS, Oakland Municipal Code section 2.04.051.B authorizes the City Council to
dispense with advertising and the request for proposal/qualifications process to secure planning and
design services upon a finding that it is in the City's best interests to do so; and

        WHEREAS, staff recommends that it is in the City's best interests to waive the advertising
and request for proposal/qualifications process for the planning and design of infrastructure
improvements for the Port-oriented Railyard and 7"^ Street Overpass work because the work will
help the Port preserve its TCIF award and secure for the Agency a $62,000,000 allocation of the
award; and

         WHEREAS, the City Administrator has determined that the Port planning and design work
awarded hereunder is of a professional, scientific or technical and temporary nature and shall not •
result in the loss of employment or salary by any person having permanent status in the competitive

                                                                                                         83 of 208
                                                                       MAJOR PROJECTS Tab 2.3

service; now therefore be it

        RESOLVED: That the City Administrator is authorized to negotiate and execute an
Exclusive Negotiating Agreement with AMB/CCG for a development on the Base on the same
general terms as the ENA and the terms of a proposed Second Amendment to the ENA, as described
in the Agenda Report for this item, without returning to City Council; and be it

       FURTHER RESOLVED: That the City ENA shall provide for: (A) reimbursement to
AMB/CCG's third-party consultant costs up to a maximum amount of $14,100,000 for the planning
and design work for the Base's Infrastructure, Public Utilities, and Public Streets, and (B) approval
of AMB/CCG's Proposal for a Development Team, Scope of Work, Budget, and Schedule for the
Planning and Design Work; and be it

       FURTHER RESOLVED: That up to $14,100,000 will come from following sources and
may be appropriated into new Projects to be established as necessary:

        •   $9,490,000 from the Joint Infrastructure Development Fund (9572), Oakland Army Base
            Organization (88679), Array Base Joint Infrastructure Development Project (S415810)
        •   $3,010,000fromthe Joint Infrastructure Development Fund (9572), Oakland Army Base
            Organization (88679), Infrastructure Master Plan Project (S415820)
        •   $1,600,000 from OBRA Federal and State Grant Fund (9577), Oakland Army Base
            Organization (88679), Infrastructure Master Plan Project (8433810)
and be it

       FURTHER RESOLVED: That the City shall appropriate and allocate up to $3,010,000 in
Army Base Redevelopment Area Tax funds (9570) over the course of FY 2010-2011 through FY
2017-2018 through its role as the successor to the Redevelopment Agency of the City of Oakland as
match funding for the TIGER II grant award; and be it

       FURTHER RESOLVED: That when Army Base Redevelopment Area Taxfrinds(9570)
are appropriated and allocated, the funds will replace the $3,010,000 from Fund (9572) Project
(S415810) as the funding source for the TIGER II match; and be it

        FURTHER RESOLVED: That the City shall maintain control over the infrastructure
master planning process and AMB/CCG cannot proceed with plarming for Port elements, such as
the Railyard and 7'^ Street Overpass, until directed to do so by City staff; and be it

        FURTHER RESOLVED: That pursuant to Oakland Municipal Code section 2.04.05l.B
and for the reasons stated above and in the City Administrator's report accompanying this
Resolution, the City Council finds that it is in the City's bests interests to waive advertising and the
request for proposal/qualifications process for the planning and design of infrastructure
                                         ^"
improvements for the Railyard and the 7* Street Overpass, and so waives the requirements; and be
it                    ;                                 ^

        FURTHER RESOLVED: That the planning and design of infrastructure improvements for
       lyard     the' ^^
the Railyard and the 7* Street Overpass work is awarded to AMB/CCG in an amount not-to-exceed
$3,850;212 and be it

       FURTHER RESOLVED: This action is exempt from the requirements of the Califomia
Environmental Quality Act (CEQA) for the reasons stated in the City Council Agenda Report, and
the Environmental Review Officer shall cause to be filed appropriate Notices of
Exemption/Determination; and be it

                                                                                                           84 of 208
                                                                   MAJOR PROJECTS Tab 2.3


        FURTHER RESOLVED: That the City Administrator is authorized to take whatever other
action is necessary to implement the Second Amendment to the ENA; and be it

        FURTHER RESOLVED: That the City Attorney shall review and approve the
agreement(s) authorized hereunder for form and legality and a copy or copies shall be placed on file
in the Office of the City Clerk.

IN COUNCIL, OAKLAND, CALIFORNiA,                                      20

PASSED BY THE FOLLOWING VOTE:

AYES - BROOKS, BRUNNER, DE LA FUENTE, KAPLAN, KERNIGHAN, NADEL, SCHAAF and PRESIDENT
REID

NOES-

ABSENT -

ABSTENTION -
                                                            ATTEST:
                                                                              LaTonda Simmons
                                                                      City Clerk and Clerk of the Council
                                                                       of the City of Oakland, California




                                                                                                            85 of 208
                                                                MAJOR PROJECTS Tab 2.3




f)FMCE ^'1 J.^^.^5,'/f;' '•'•••^•^                                    Approved as to form and legality;


  ZOil HAR n        Pn 5:                                                     Agency Counsel



                                     REDEVELOPMENT AGENCY
                                     OF THE CITY OF OAKLAND
                                     Resolution No.            CM S



              RESOLUTION AUTHORIZING:

              (1)  T H E A G E N C Y ADMINISTRATOR TO NEGOTIATE AND
              EXECUTE A SECOND AMENDMENT TO T H E E X C L U S I V E
              NEGOTIATING AGREEMENT (ENA) WITH A M B PROPERTY
              CORPORATION/CALIFORNIA CAPITAL GROUP (AMB/CCG) FOR
              A DEVELOPMENT ON THE FORMER O A K L A N D A R M Y BASE
              ("BASE") TO:

                  A. EXTEND T H E ENA T E R M F R O M APRIL 22, 2011 TO THE
                     E A R L I E R OF APRIL 22, 2012 OR T H E EXECUTION OF A
                     LEASE DISPOSITION AND DEVELOPMENT A G R E E M E N T ;
                     AND

                   B. PROVIDE FOR: (A) REIMBURSEMENT TO A M B / C C G OF UP
                      TO A M A X I M U M AMOUNT OF $14,100,000 FOR THE
                      PLANNING AND DESIGN WORK FOR T H E BASE'S
                      INFRASTRUCTURE, PUBLIC UTILITIES, AND PUBLIC
                      STREETS; (B) APPROVAL OF A M B / C C G ' S PROPOSAL FOR
                      A D E V E L O P M E N T T E A M , SCOPE OF WORK, BUDGET, AND
                      SCHEDULE FOR THE PLANNING AND DESIGN W O R K ; (C)
                      ELIMINATION             OF        THE    REQUIREMENT         TO
                      A C C O M M O D A T E THE O A K L A N D PRODUCE M A R K E T AND
                      THE O A K L A N D F I L M CENTER AS PART OF THE
                      DEVELOPMENT;             AND (D) EXPANSION          OF THE
                      DEVELOPMENT AREA TO INCLUDE T H E FORMER
                      O A K L A N D MARITIME SUPPORT SERVICES E N A SITE IN
                      THE EAST GATEWAY AREA

              (2)    A WAIVER OF THE ADVERTISING AND REQUEST FOR
              PROPOSAL/QUALIFICATIONS PROCESS AND A N A W A R D OF T H E
              PLANNING AND DESIGN OF INFRASTRUCTURE IMPROVEMENTS FOR
              THE PORT-ORIENTED RAILYARD AND 7^" STREET OVERPASS WORK,
              IN A N AMOUNT NOT-TO-EXCEED $3,850,212, TO A M B / C C G




                                                                                                          86 of 208
                                                                MAJOR PROJECTS Tab 2.3




       WHEREAS, the Oakland Army Base Reuse Plan and 2002 Environmental Impact
Report document the need to install all new public utilities and streets to serve new
development of the former Oakland Army Base; and

        WHEREAS, the Request for Proposals issued by the Agency that subsequently led to
the selection of AMB Property Corporation/California Capital Group (AMB/CCG) clearly
articulated the expectation that the master developer would be responsible for all aspects of
the development of the Army Base site including site planning, engineering, and other pre-
development activities; and

       WHEREAS, on January 19, 2009, the Agency executed an Exclusive Negotiating
Agreement (ENA) with AMB/CCG for the potential redevelopment of a portion of the former
Army Base identified as the Gateway Development Area and which included all of the
Central and West Gateway Areas and part of the East Gateway Area; and

      WHEREAS, extensive planning and design work for areas outside the ENA
Development Area is required for the planning and design of the ENA Development Area;
and

        WHEREAS, the infrastructure improvements for the Port-oriented Railyard and 7"^
Street Overpass are not essential to the planning and design of the ENA Development Area
but are necessary to preserve the $242,000,000 in Trade Corridor Improvement Funds (TCIF)
which were awarded to the Port of Oakland but may be lost if the Railyard and the 7^^ Street
Overpass are not designed in a timely maimer; and

      WHEREAS, the Amended and Restated Memorandum of Agreement between the
Agency and the Port contemplates a unified approach to the design of the Army Base; and

        WHEREAS, the Cost Sharing Agreement pending between the Agency and the Port
calls for the Agency to invest $14.1 million toward the design of the entire Army Base,
including the Railyard.and the 7**' Street Overpass, in exchange for the Port supporting a
$62,000,000 allocation of the TCIF award for infrastructure development in the Agency-
owned portion of the Base; and

         WHEREAS, planning and design work that is not essential to the ENA Development
Area should be awarded pursuant to the Agency's purchasing processes—advertising and
request for proposal/qualifications requirements - unless the Agency Board determines that it
is in the Agency's best interests to waive such processes; and

        WHEREAS, the ENA required AMB/CCG to propose a Development Team, Scope,
Schedule, and Budget for the planning and design work required for the construction of
infrastructure, public utilities, and public streets on the former Army Base; and

        WHEREAS, AMB/CCG has submitted the required proposal that includes a Budget
of $ 14,100,000 for master planning public infrastructure improvements for the former Army
Base; and

        WHEREAS, the Budget includes $3,850,212 for the planning and design of
infrastructure improvements for the Port-oriented Railyard and the 7' Street Overpass; and




                                                                                                87 of 208
                                                                 MAJOR PROJECTS Tab 2.3




       WHEREAS, the Agency established a Joint Infrastructure Development Fund (9572)
with $16,300,000 for the development of the former Oakland Army Base, including the
plarming and design of public improvements; and

        WHEREAS, AMB/CCG's proposed Development Team is ready to begin preparing
infrastructure plarming and design documents for the Army Base and use of this Development
Team is the surest and most timely way to accomplish the work and meet state and federal
funding deadlines; and

       WHEREAS, Oakland Municipal Code section 2.04.05l.B authorizes the Agency
Board to dispense with advertising and the request for proposal/qualifications process for
planning and design services upon afindingthat it is in the Agency's best interests to do so;
and

        WHEREAS, staff recommends that it is in the Agency's best interests to waive the
advertising and request for proposal/qualifications process for the planning and design of
infrastructure improvements for the Port-oriented Railyard and 7*'' Street Overpass work
because the work will help the Port preserve its TCIF award and secure for the Agency a
$62,000,000 allocation of the award; and

        WHEREAS, the Agency Administrator has determined that the Port planning and
design work awarded hereunder is of a professional, scientific or technical and temporary
nature and shall not result in the loss of employment or salary by any person having
permanent status in the competitive service; and

       WHEREAS, on July 20, 2010, the Agency and AMB/CCG entered into a First
Amendment to the ENA to allow the Agency to contract with a consultant to prepare all
documentation necessary for environmental review under the Califomia Environmental
Quality Act (CEQA), and to share the costs of that contract with AMB/CCG; and

       WHEREAS, the environmental review which is necessary for final approval to
redevelop the Army Base is still underway; and

       WHEREAS, the ENA, as amended, expires April 22, 2011; now, therefore be it

      RESOLVED: That the Agency Administrator is authorized to negotiate and execute a
Second Amendment to the ENA with substantially the following terms:

       (1)     Extension of the Exclusive Negotiating Agreement with A M B Property
               Corporation/California Capital Group from April 22, 2011 to the earlier of (1)
               April 22, 2012, (2) the completion of CEQA and execution of a Lease
               Disposition and Development Agreement, or (3) the termination of the ENA
               due to a default; and

       (2)     As to the infrastructure master plarming and design work, approval of the
               Developer's proposed team of consultants, scope of work, schedule, and
               budget, as represented in Exhibits of the Second Amendment to the ENA; and




                                                                                                88 of 208
                                                                    MAJOR PROJECTS Tab 2.3




       (3)       Agreement to reimburse the Developer's third party consultant costs up to a
                 maximum amount of $14.1 million through the Agency's Joint Infrastructure
                 Development Fund, established for the development of the former Oakland
                 Army Base, and TIGER II grant funding, for the Army Base infrastructure
                 master plarming and design work. The Developer will receive no
                 reimbursements or fees for its own costs in the management of the design
                 consultant team. All final design decisions for the public infrastructure portions
                 shall be made by the Agency and other City departments. The Developer will
                 be responsible for all costs related to the vertical development planning and
                 any site improvement planning on the development sites; and

       (4)       Elimination of the requirement to accommodate the Film Center and the
                 Produce Market as part of the development, and expansion of the Developer's
                 development site to include approximately 15 acres of the East Gateway that
                 formerly was covered by the now-expired ENA with Oakland Maritime
                 Support Services (OMSS); and

       (5)       Terms specifying how the Agency and Developer will coordinate regarding
                 outside agency negotiations, ongoing property management during the design
                 phase, and securing additional other government funding; and be it

       FURTHER RESOLVED: That up to $14,100,000 will come from the following
sources and may be appropriated into new Projects to be established as necessary:

             •   $9,490,000 from the Joint Infrastructure Development Fund (9572), Oakland
                 Army Base Organization (88679), Army Base Joint Infrastructure
                 Development Project (S415810)
             •   $3,010,000 from the Joint Infrastructure Development Fund (9572), Oakland
                 Army Base Organization (88679), Infrastructure Master Plan Project
                 (S415820)
             •   $1,600,000 from the OBRA Federal and State Grant Fund (9577), Oakland
                 Army Base Organization (88679), Infrastructure Master Plan Project
                 (S433810)
and be it

        FURTHER RESOLVED: That the Agency shall maintain control over the
infrastructure master planning process and AMB/CCG carmot proceed with plarming for Port
                                    ^^
elements, such as the Railyard and 7" Street Overpass, until directed to do so by Agency staff;
and be it

        FURTHER RESOLVED: That pursuant to Oakland Municipal Code section
2.04.05l.B and for the reasons stated above and in the Agency Administrator's report
accompanying this Resolution, the Agency Board finds that it is in the Agency's bests
interests to waive advertising and the request for proposal/qualifications process for the
planning and design of infrastructure improvements for the Railyard and the 7"' Street
Overpass work and so waives the requirements; and be it




                                                                                                      89 of 208
                                                                MAJOR PROJECTS Tab 2.3




      FURTHER RESOLVED: That the planning and design of infrastructure
improvements for the Railyard and the 7'^ Street Overpass work is awarded to AMB/CCG in
an amount not-to-exceed $3,850;212 and be it

       FURTHER RESOLVED: This action is exempt from the requirements of the
Califomia Environmental Quality Act (CEQA) for the reasons stated in the Agency Board
Agenda Report and the Environmental Review Officer shall cause to be filed appropriate
Notices of Exemption/Determination; and be it

      FURTHER RESOLVED: That the Agency Administrator is authorized to take
whatever other action is necessary to implement the Second Amendment to the ENA; and be
it

         FURTHER RESOLVED: That the Agency Counsel shall review and approve the
agreement(s) authorized hereunder for form and legality and a copy or copies shall be placed
on file in the Office of the City Clerk.


IN AGENCY, OAKLAND, CALIFORNIA,                                2011

PASSED BY THE FOLLOWING VOTE:

AYES - BRUNNER, KERNIGHAN, NADEL, DE LA FUENTE, BROOKS, KAPLAN, SCHAAF AND
CHAIRPERSON REID

NOES-

ABSENT-

ABSTENTION -
                                            ATTEST:

                                            LATONDA SIMMONS
                                            Secretary of the Redevelopment Agency
                                            of the City of Oakland, California




                                                                                               90 of 208
                                                                   MAJOR PROJECTS Tab 2.3


              REDEVELOPMENT AGENCY
.....o/llim. cA^^ THE CITY OF OAKLAND
       o^^i^^HO                      AGENDA         REPORT
2011 HAR 17 PH 5-2h
 TO:        Office of the City/Agency Administrator
 ATTN:      Dan Lindheim
 FROM:      Community and Economic Development Agency
 DATE:      March 29, 2011
 Re:        An Agency Resolution Authorizing the Agency Administrator to Negotiate and
            Execute a Cost Sharing Agreement Between the Redevelopment Agency and the
            Port of Oakland for the Development of Infrastructure Including Public Utilities
            and Public Streets on the Former Oakland Army Base

            A City Resolution Authorizing the City Administrator to Negotiate and Execute
            a Cost Sharing Agreement Between the City and the Port of Oakland for the
            Development of Infrastructure Including Public Utilities and Public Streets on
            the Former Oakland Army Base



 SUMMARY

 Staff requests that the Agency Board and the City Council adopt resolutions authorizing the
 Agency/City Administrator to negotiate and execute a Cost Sharing Agreement with the Port of
 Oakland to expedite the development of infrastructure on the former Oakland Army Base.

 On July 15, 2010, the Agency Board adopted Resolution No. 2010-0089 C.M.S. authorizing the
 Agency Administrator to negotiate a Cost Sharing Agreement with the Port of Oakland for the
 development of the former Oakland Army Base. Attachment A to this report is a draft Term
 Sheet that describes the fundamental provisions of the Cost Sharing Agreement recommended by
 staff. The final agreement is in draft form as of this writing so staff requests authorization to
 negotiate any last minute changes that do not alter the fundamental provisions of the Agreement
 as summarized on the Term Sheet.

 Staff is recommending Agency Board and City Council authorization to expedite the execution
 of the Cost Sharing Agreement among the Agency, City and the Port, which includes a
 commitment of up to $10,000,000 in future tax revenue in addition to $16,300,000 already
 approved by the Agency Board for a Joint Infrastructure Development Fund and $5,700,000 for a
 Joint Environmental Remediation Fund. These funding commitments total $32,000,000 from the
 Agency/City for infrastructure development planning, design and site preparation. In return, the
 Port, through its Trade Corridor Improvement Fund, will provide the Agency/City up to
 $62,000,000 for reimbursement of infrastructure construction costs allowable by Caltrans within
 the East and Central Gateway Areas.



                                                                               Item:
                                                                                 CED Committee
                                                                                  March 29, 2011



                                                                                                     91 of 208
                                                                    MAJOR PROJECTS Tab 2.3

Dan Lindheim
CEDA/Redevelopment: Army Base Cost Sharing Agreement                                       Page 2


Staff is recommending that the Cost Sharing Agreement be among the Agency, City and Port in
the event the Agency is dissolved by the state legislature and the City assumes ownership of the
Army Base property. In the event Tax Increment revenue is negatively impacted in any way due
to State budget actions, the Agreement will contain provisions for reducing or eliminating the
$10,000,000 additional funding commitment accordingly.


FISCAL IMPACT

The Army Base Joint Environmental Remediation Fund of $5,741,477 was adopted by the
Agency Board on March 11, 2010 through Resolution No. 2010-0049 C.M.S. and established as
Fund 9579. The Army Base Joint Infrastructure Development Fund of $ 16,300,000 was adopted
by the Agency Board on July 15, 2010 through Resolution No. 2010-0089 C.M.S. and
established as Fund 9572. These funds represent the Agency's initial contribution of
$22,000,000 towards the preparation of Army Base site for development of infrastructure.

Should the Redevelopment Agency be dissolved, the City will assume ownership of the Army
Base property and all assets and liabilities associated with it.

The Army Base Redevelopment Area experienced a $2,900,000 increase in Tax Increment in
Fiscal Year 2010-2011 due to substantial tenant improvements made by Ports America. Staff had
anticipated this increase in Tax Increment revenue and is assured that there will be sufficient net
Tax Increment revenue going forward to meet a commitment of $ 10,000,000 over the next seven
years to contribute to the planning, design and construction of infrastructure necessary to support
commercial development on the former Army Base. The Cost Sharing Agreement will have a
provision for reducing or eliminating altogether the additional $10,000,000 contribution
depending on what happens with Redevelopment based on the Governor's budget proposal.

To cover future costs of public street and utility maintenance and replacement, the project team
may form a Community Facilities District or create some other kind of mechanism to assess fees
from project site tenants.


BACKGROUND
The Cost Sharing Agreement with the Port of Oakland is essential to prepare the former Oakland
Army Base for commercial development. Milestones achieved to date towards the development
of the Army Base include the following:

   •   Selection of AMB/CCG as the master developer and the execution and amendment of
       their exclusive negotiating agreement;
   •   Amendment of the Port of Oakland's Baseline Agreement with the California
       Transportation Commission for the allocation of the S242 million in Trades Corridor


                                                                                Item:
                                                                                  CED Committee
                                                                                   March 29, 2011



                                                                                                      92 of 208
                                                                    MAJOR PROJECTS Tab 2.3

Dan Lindheim
CEDA/Redevelopment: Army Base Cost Sharing Agreement                                       Page 3


        Improvement Funds (TCIF) to include Agency property and public infrastructure
        improvements;
    •   Decision to relocate the 15-acre Ancillary Maritime Support Services component in order
        to free up the East Gateway Area for development by AMB/CCG to support Port cargo
        movement;
    •   Decision to master develop infrastructure for the entire Army Base, particularly the North
        Gateway Area, to prepare the site for the possible relocation of two recyclers from West
        Oakland;
    •   The establishment of the $11.4 million Joint Environmental Remediation Fund in
        conjunction with the Port to continue remediation work required to prepare the site for
        industrial development;
    •   The establishment of the $16.3 million Joint Infrastructure Development Fund to master
        plan infrastructure development for the entire area and to design major public utility and
        street improvements with AMB/CCG and the Port;
   •    The initiation of CEQA and NEPA review required to clear the project for long-term
        lease agreements and the commencement of construction; and
   •    The award the Department of Transportation TIGER II grant, $ 1.6 million of which is
        targeted for Army Base infrastructure development.

The Cost Sharing Agreement with the Port is crucial given the potential for the Agency to
receive up to $62 million in TCIF revenue to support construction of utilities and streets on
Agency-owned property. The TCIF agreement requires a dollar-for-dollar match from the
Agency and private sources, which is supported by a proposed investment of $32,000,000 from
the Redevelopment Agency over the next seven years. To retain the TCIF allocation, the Port
must break ground by December 2013. Substantial environmental review, planning, design and
construction drawings are required to get to construction. Given that the infrastructure is
predominately for public improvements, it is essential that the Redevelopment Agency commit
to supporting this work.

The development of new infrastructure, including expanded rail service, more efficient streets
and intersections, and new public utilities, will create conditions which will attract subsequent
private investment with an estimated value of $225,000,000. The total project value of roughly
$750,000,000, including all public and private investment into the site, will create thousands of
construction and permanent jobs, and the substantial economic and community benefits that
come with those jobs. The vision is a thriving Port and a new industrial district that benefits
Oakland, the region and the nation.


KEY ISSUES AND IMPACTS

Potential Dissolution of the Redevelopment Agency
At the time of this writing, it appears as if the State will dissolve Redevelopment Agencies as of
July 1, 2011. The Agency and City have taken actions to preserve Agency assets and resources
in order to continue redevelopment activities to the extent possible under the direction of the

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CEDA/Redevelopment: Army Base Cost Sharing Agreement                                       Page 4


City. This report and resolutions are intended to enable the Agency and City to continue to
prepare the Army Base for commercial development and to comply with our obligations to the
Department of the Army and the State Department of Toxic Substances Control.

Port Trade Corridor Improvement Fund (TCIF) Allocation
The Port's $242,000,000 TCIF allocation requires a dollar-for-dollar match. The TCIF
allocation requires both the Agency and private sources of funding to meet this match
requirement. The Baseline Agreement between the Port and the California Transportation
Commission for the TCIF allocation identifies the Agency's $32,000,000 matching investment.
The Cost Sharing Agreement is intended to reinforce the commitment of the Port to investing
$62,000,000 in TCIF funds for development construction on the Agency's Army Base property,
including remediation, site preparation, public streets and infrastructure. This strong display of
local and state support for the project positions the Agency and Port for federal grants, most of
which require matching. The combination of local, state and federal funding to prepare the
former Army Base for development should attract hundreds of millions of dollars in private
investment as well. Overall, approximately 72% of the total infrastructure investments for the
project will go towards the improvement of Agency/City land and assets.

Investments
The Agency's initial investment of $22,000,000 ($5,700,000 for the Joint Remediation Account
and $16,300,000 for the Joint Infrastructure Development Fund) will reap lasting benefits and
comes with minimal risk. The Agency and Port must complete the environmental remediation
work as required by the State-approved Remedial Action Plan (RAP) and the Risk Management
Plan (RMP) by August 2013 per our agreement with the Army, but preferably much sooner to
access our environmental remediation insurance policy. In addition to environmental
remediation, the Agency's initial contribution will be used to design the expanded rail, public
streets, and public utilities to serve the entire Base. Detailed construction drawings and CEQA
and NEPA clearance will pave the way for an infusion of State TCIF and federal funding for
construction. Without the design work and environmental clearances, there is no construction
money.

Based upon projections of new investments in the Army Base and Maritime Sub-districts, net tax
increment will increase. Apart from the Wood Street Subarea projected tax increment, staff has
concluded that it is feasible to commit an additional investment of $10,000,000 over seven years
towards the Army Base development project.

Part of the Agency's investment includes a TIGER II grant award of $2,000,000, 80% of which
is specifically for Army Base infrastructure master planning and design. This portion of the
grant award requires a match of up to $3,010,000, which may come from future tax revenue as
part of the $10,000,000 commitment, depending upon what occurs with the Agency and the
succession process.




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CEDA/Redevelopment: Army Base Cost Sharing Agreement                                      Page 5


Assurances
The terms of the Cost Sharing Agreement with the Port (see Attachment A) are based on the
assurance that Caltrans will reimburse the Agency for construction costs consistent with the
goals of the California Transportation Commission as described in the Proposition l-B Goods
Movement Program authorizing legislation. The Port agrees that the Cost Sharing Agreement
will be null and void should there not be an amendment to the Baseline Agreement between the
Port and the California Transportation Commission, which specifically recognizes the Agency as
a matching fund source with an allocation of $62,000,000 for infrastructure and public
improvements on ORA and City property and facilities on the former Army Base.

California Environmental Quality Act
The actions called for in this report comply with the requirements of the California
Environmental Quality Act (CEQA) for the following reasons, each of which provides a separate
and independent basis for CEQA compliance: (1) some activides covered under proposed Cost
Sharing Agreement have already been evaluated by the previously certified 2002 EIR, such as
hazardous materials remediation; (2) certain activities covered under the proposed Cost Sharing
Agreement are statutorily exempt from CEQA, such as Planning and Feasibility Studies,
including detailed design and engineering efforts, pursuant to CEQA Guidelines section 15262;
(3) the proposed Cost Sharing Agreement is merely a funding mechanisms that is not subject to
CEQA, pursuant to CEQA Guidelines section 15378(b)(4); and (4) this action is exempt from
CEQA pursuant CEQA Guidelines section 15061(b)(3), where it can be seen with certainty that
there is no possibility that the project may have a significant effect on the environment.

Specifically, the proposed Cost Sharing Agreement does not constitute an approval by the
Agency of the proposed project and the subsequent approval of any specific project by the
Agency Board is subject to CEQA, where applicable. In particular, the Agency reserves all of its
rights and duties under CEQA with respect to the proposed Army Base project, including
without limitation the authority to do any and all of the following: (a) prepare an environmental
study evaluating the impacts of the proposed project, feasible alternatives to the project, and
feasible mitigation measures; (b) adopt any feasible alternatives and/or feasible mitigation
measures to lessen any significant environmental impacts resulting from the proposed project; (c)
determine that any significant environmental impacts of the proposed project that cannot be
mitigated are acceptable due to project benefits overriding any significant unavoidable impacts;
and/or (d) decide to modify or deny its approval of the proposed project, and not to proceed with
the project, due to the results/findings of the CEQA process. After completion of the CEQA
process, the specific project will return to the Agency Board for its consideration based upon the
foregoing.


PROJECT DESCRIPTION

Cost Sharing Agreement
The Cost Sharing Agreement is the engine that enables the use of TCIF funds. Agency and Port
staff members have determined that it is best to use a stand-alone agreement rather than an

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CEDA/Redevelopment: Army Base Cost Sharing Agreement                                      Page 6


amendment to the Amended and Restated Memorandum of Agreement (ARMOA) among the
City, Agency and Port because of the possibility of including other parties, such as AMB/CCG,
in the agreement in the future. For the time being, the Cost Sharing Agreement would be
between the Agency and the Port, but could be amended without opening the ARMOA if needed.

The Cost Sharing Agreement as outlined on Attachment A covers the following key elements:

   1. The Agency's estimated commitment over a period of seven years is $32,000,000. This
      commitment includes the $5,700,000 already approved for the Joint Environmental
      Remediation Fund, the requested $16,300,000 for the Joint Infrastructure Development
      Fund, and up to $10,000,000 over seven years in net tax increment revenue (should the
      Agency no longer exist, the $10 million will not become a City obligation). The transfer
      of tax increment funds to the Joint Infrastructure Remediation Fund will require Agency
      Board approval each time.

   2. Project priorities for the design and eventual development of (a) the build-out of
      Maritime Street, which is the utility "spine" for the East and Outer Harbor portions of the
      Base; (b) the build-out of Burma Road, which is the utility "spine" for the Central and
      West Areas, as well as the access road to the West Area and Shoreline and Gateway
      Parks; (c) the expanded rail, which is essential for the City's new industrial district and
      the Port's future success; and (d) the 7"^ and Maritime Street Grade Separation project,
      which is essential for relieving congestion, reducing emissions, and enhancing safety for
      pedestrians and bicyclists.

   3. The commitment of up to $62,000,000 in TCIF investments for construction of Maritime
      Street, Burma Road, public utilities, and other projects specifically on Agency Army
      Base property.

   4. The coordination of other fund development efforts with the Port and AMB/CCG, with a
      framework for how these new funds will be managed and invested to advance the project.

   5. The Cost Sharing Agreement will be null and void without an amended Baseline
      Agreement between the Port and the California Transportation Commission, which must
      recognize the Agency's matching funds of $32,000,000 and allocate $62,000,000 for
      infrastructure construction costs on Agency property and City facilities.

North and West Gateway Areas
The North and West Gateway Areas are not within the boundaries for the Port's TCIF allocation.
The Joint Infrastructure Development Fund and Cost Sharing Agreement do not at this time take
the development of those two areas into account.

That said, Agency staff is considering options for preparing the North Area for development
simultaneously with the East and Central Areas. New utilities installed in the East and Central
Gateway Areas will serve the North and West Areas. Sequencing and phasing will be critical for

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CEDA/Redevelopment: Army Base Cost Sharing Agreement                                      Page 7


the success of the entire Army Base project. Contemplated uses for the North Area are no less
important than the East and Central. Staff will continue to work on maximizing revenue-
generating opportunities on the former Army Base beyond the Reinvestment Period (which
extends until August 7, 2013 to support development of the North and West Areas. Lease,
utility, land sale, and grant proceeds are all being contemplated to raise the required funds
needed to prepare the North Area for development.

The West Area is the last phase being considered for development. At this juncture, there has
been limited thought and time invested in its development, which cannot occur until Caltrans
completes construction of the new Bay Bridge and deconstructs the old bridge. That will not
happen until 2015 or beyond.

SUSTAINABLE OPPORTUNITIES

Economic: The redevelopment of the former Oakland Army Base will create thousands of
temporary and permanent jobs, substantially increase the City's tax base, and support the long-
term competitiveness of the Port of Oakland.

Environmental: The improvements planned for the development of the former Army Base will
reduce air pollution with the expansion of rail service and the improvement of major
intersections. The Agency will ensure that development projects adhere to the City's sustainable
development guidelines, which include criteria for green building technologies, site selection and
preparadon, water, energy, indoor environmental quality and human health factors, materials
selection with recycled content or health considerations, and waste and recycling procedures.

Social Equity: Social equity is ensured through the City's and Port's local hiring and
contracting requirements. Community benefits associated with the project will be substantial,
including contributions to the West Oakland Community Fund and support for workforce
development programs. Staff will return to the Agency Board at a later date with options and
recommendations for how to meet most effectively the Agency's, Port's and master developer's
community benefits goals and priorities.

DISABILITY AND SENIOR CITIZEN ACCESS

Any projects and programs implemented in this project area will be required to comply with
applicable City, State, and Federal disabled access requirements.

RECOMMENDATION AND RATIONALE

Staff recommends that the Agency Board/City Council adopt the attached resolutions authorizing
the Agency/City Administrator to negotiate and execute, without returning to the Agency
Board/City Council, a Cost Sharing Agreement between the Redevelopment Agency, City and

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CEDA/Redevelopment: Army Base Cost Sharing Agreement                                         Page 8


the Port of Oakland for the development of infrastructure, public utilities and public streets on
the former Oakland Army Base committing a total of thirty-two million dollars ($32,000,000) of
Agency funds to the development. This commitment includes an allocation of $10,000,000 in
tax revenue generated from the Oakland Army Base Redevelopment Area over the next seven
years.

The Cost Sharing Agreement is an essential administrative mechanism for guaranteeing a
substantial amount of funding from the Port through its TCIF allocation for the construction of
public improvements and development on Agency/City property.


ACTION REQUESTED OF THE CITY COUNCIL

Staff requests that the Agency Board/City Council adopt the Resolutions.




                                               Walter S. Cohen, Director
                                               Community and Economic Development Agency

                                               Reviewed by:
                                               Gregory Hunter, Deputy Director of Economic
                                               Development and Redevelopment

                                               Prepared by:
                                               Al Auletta, Redevelopment Area Manager


APPROVED AND FORWARDED TO THE
COMMUNITY AND ECONOMIC DEVELOPMENT COMMITTEE:



Office of the City/Agency Administrator




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                                                                                  —
                                                                      Attachment A 1

                          OAKLAND ARMY BASE
                 JOINT INFRASTRUCTURE DEVELOPMENT
                      COST SHARING AGREEMENT

       OAKLAND REDEVELOPMENT AGENCY/CITY OF OAKLAND
                                          &

                               PORT OF OAKLAND
                                   TERM SHEET

I.    Intention of this Agreement

      A) A stand alone agreement among the Oakland Redevelopment Agency/City of
      Oakland (sometimes referred to herein as the "ORA", the "ORA/City", the
      "Redevelopment Agency", the "Agency", or the "City") and the Port of Oakland
      (Port) separate from the Amended and Restated Memorandum of Agreement
      (ARMOA). Nothing in this Term Sheet or future agreement is intended to modify
      the terms and conditions of the ARMOA with respect to any funds subject to the
      ARMOA, including without limitation, any funds to be deposited into the Joint
      Environmental Remediation Fund.

      B) This will be a binding agreement to commit specific funds and take other
      actions for the redevelopment of portions of the former Oakland Army Base
      separately owned by the Port and the ORA/City.

II.   Funding

      ORA/Citv

      The ORA/City commits a total of $32,000,000 towards the completion of certain
      regulated environmental compliance work, and the design of certain railroad
      infrastructure, public utilities and public streets to be agreed upon between the
      ORA and the Port. ORA/City funding will be provided as follows:

      A) $5,700,000: Joint Environmental Remediation Fund—approved by the
      Agency Board to support work per the Remediation Action Plan/Risk
      Management Program (RAP/RMP), Resolution No. 2010-0049 C.M.S., 4/20/10,
      as required under the ARMOA.

      B) $16,300,000: Joint Infrastructure Development Fund—approved by the
      Agency Board for the development of certain railroad infrastructure, public
      utilities, and public streets to be agreed upon between the ORA and the Port on
      the former Oakland Army Base, Resolution No. 2010-0088 C.M.S., 7/20/10.




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                                                                                 I

                                                                          Attachment A—2

      C) $10,000,000: hivestment over a seven year period FY 10-11 to FY 16-17
      which was approved by the Agency Board as part of the total $32,000,000 for the
      Cost Sharing Agreement, Resolution No. 2010-0089 C.M.S., July 20, 2010. Such
      $10,000,000 will be used for the design and development of certain railroad
      infrastructure, public utilities, and public streets to be agreed upon between the
      ORA and the Port on the former Oakland Army Base.

      Port

      The Port agrees to use commercially reasonable efforts to provide the ORA/City
      with access to certain state grant funds by incorporating the redevelopment of
      certain ORA/City portions of the OAB into the Port's grant funded projects.

      A) $62,000,000: Through its Trade Corridor Improvement Fund (TCIF)
      allocation for (i) the Outer Harbor Intermodal Terminals ("OHIT") project and
                *
                '
      (ii) the 7 ^ Street Grade Separation and Roadway Improvements project ("7^'^
      Street Projecf and collectively with the OHIT, the "TCIF Projects"), the Port will
      work in good faith with the ORA/City and use commercially reasonable efforts
      with the state to obtain reimbursement of up to $62,000,000 for the construction
      of certain railroad and street infrastructure improvements as more specifically
      described in the respective Baseline Agreements as each may be amended from
      time to time for the purpose of enhancing trade through the northern California
      trade corridor and consistent with the goals of the California Transportation
      Commission (CTC) in strict accordance with the Proposition IB Goods
      Movement Program Authorizing Legislation.

      B) $5,700,000: Joint Environmental Remediation Fund—As required under the
      ARMOA, the Port is obligated to fund an equal amount as the ORA/City towards
      environmental compliance work identified in the RAP/RMP.

III. Uses and Conditions

      A) The ORA/City's Joint Infrastructure Development Fund of $16,300,000 will
      be used primarily for the design of certain railroad infrastructure, public utilifies,
      and public streets, all as agreed upon in writing between the ORA/City and the
      Port.

      B) The ORA/City Joint Environmental Remediation Fund of $5,700,000 and the
      Port's equal contribution will go towards identified RAP/RMP sites on Agency
      and Port property conveyed by the Army in accordance with the terms and
      conditions of the ARMOA.

      C) The $10,000,000 over seven years has not been specifically assigned, and will
      be agreed upon in writing between the ORA/City and the Port. Note that this
      commitment is based upon anticipated net tax increment and the amount of tax
      increments available is subject to modificadon in the event of unforeseen




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                                                                   Attachment A~3

reductions in tax increment collected from the Army Base and Maritime sub-areas
and/or other requirements imposed by future amendments to the Community
Redevelopment Law by the State legislature. If sufficient tax increments are not
available, the City may use other sources of funds to meet all or a portion of the
$10,000,000 target, including net lease proceeds and grants secured exclusively
by the City. The Agency has already secured $1.5 million in TIGER II grant
funding which will provide the initial contribution to the Agency's $10,000,000
funding obligation. The remaining $8.5 million will be provided as possible over
the seven year period identified above. In the event the Agency/City is unable to
contribute all or part of the remaining $8.5 million, the Parties will renegotiate the
TCIF commitment to the Agency/City.

D) The TCIF program rules limit funding to construcfion costs on a
reimbursement basis, and require a minimum dollar-for-dollar match from other
public and private sources before it can be drawn upon. Baseline Agreements
between the Port and the state require the Port to provide a 50% match for the 7*  ^^
Street Grade Separation project and a 52% match for the OHIT project. The
ORA/City and the Port will cooperate in good faith to seek TCIF reimbursement
of construction costs for the agreed upon railroad infrastructure, public utilities
and public streets improvements on the ORA/City's portion of the Army Base.

E) Both parties acknowledge that the current project described in the Baseline
Agreements is not fully funded. The Port and the ORA/City agree to work in
good faith to solicit addidonal funds such that the projects, as described in the
TCIF Baseline Agreements would be successfully completed. Such good faith
effort shall include soliciting federal funds, addidonal state funds, private sector
investments, available tax increment revenues, etc. If the good faith effort of both
the Port and the ORA/City are unsuccessful in securing additional funding, then
the Port and the ORA/City agree to work collaboratively and reduce the scope of
work for the projects, subject to the approval of CTC through modifications to the
Baseline Agreements. If such a reducdon would make the development goals
and objectives infeasible or impractical for either party, then that party may
choose not to move forward with its portion of the development. The other party
would then be provided with the opportunity to proceed with what portions of the
projects it was capable to complete, subject to the prior written approval of the
CTC and other state agencies responsible for the TCIF funds. In the case that
ORA/City is able to move forward and the Port is not, the Port shall continue to
act as the local agency under the Baseline Agreements, however, it shall work
with CTC to have the agreements assigned to the ORA/City and the ORA/City
designated as the lead agency. If neither party is willing to proceed forward under
a reduced funding scenario, then the parties shall agree not to proceed with the
work described in the Baseline Agreements. If either party, or both parties, elect
not to proceed with the Baseline Agreements, neither party shall be responsible
for prior costs incurred as contemplated under this Agreement or as part of a good
faith effort to attempt to deliver the projects described in the Baseline
Agreements. In the event that one party elects to move forward with development




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                                                                       Attachment A--4

       and the other elects not to, the party electing to move forward shall indemnify,
       defend, and hold harmless the party not moving forward for any and all costs,
       damages, losses, penalties, or other actions arising out of the TCIF program and
       Baseline Agreements as a resuU of the moving forward party's decision to move
       forward.

       F) The Port agrees that this agreement is null and void should there not be an
       amendment to the Baseline Agreements it has with the CTC identifying the
       ORA/City as a funding source and a TCIF project budget allocation of
       $62,000,000 for agreed upon improvements on ORA/City Army Base property
       and facilities as set forth elsewhere in this Term Sheet If the Baseline
       Agreements are amended as described herein, the ORA/City agrees to (i) use such
       TCIF funds in strict compliance with the requirements of the Baseline
       Agreements, and (ii) use and develop Agency's and City's portions of the Army
       Base property only for purposes that are consistent with and in furtherance of the
       Baseline Agreements and the Proposition IB Goods Movement Program. Should
       either party use the TCIF monies for its project and later, those monies be deemed
       ineligible or unqualified, the responsible party shall indemnify, defend, and hold
       the other party harmless and resolve the issue with CTC.

       G) The Port agrees that, in exchange for the ORA/City's commitment to expend
       the $16.3 million in funds needed to produce the Master Infrastructure
       Development Plan, priority will be given to the construction of back bone utility
       and street improvements required in Maritime Street to the extent permitted under
       the applicable Baseline Agreements and the Proposition IB Goods Movement
       Program. TCIF-funded construction will be subject to agreement between the
       ORA/City and the Port on the design, phasing and sequencing of work of the
       public infrastructure improvements.


IV.     Scope of Work

Environmental Remediation: The parties acknowledge and agree that, as anticipated,
remediation costs have exceeded the funding provided by the Army pursuant to the
Environmental Services Cooperative Agreement (ESCA) executed September 27, 2002
between the Army and the Oakland Base Reuse Authority. The Port and the City used a
portion of the Army monies to purchase cost cap and pollufion legal liability insurance
policies which protect both the Port and the Redevelopment Agency from significant
environmental liabiliUes beyond each party's means. The ARMOA provides for funding
environmental remediation by either party for environmental compliance activities on the
property. Neither the Port nor the Redevelopment Agency are proposing in this
agreement additional fiinding or an additional mechanism for sharing costs associated
with environmental compliance activides on the Oakland Army Base. This does not
mean an additional mechanism can not be added under another agreement. The
allocafion procedure set forth in section 5.3 of the ARMOA shall continue to determine
how certain remediation costs referenced in such secUon 5.3 are funded, which




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                                                                         Attachment A—5

remediation costs may be eligible as TCIF matching funds. The responsibility to perform
environmental compliance activides will hkewise be as described in the ARMOA.
However, each party has decided to identify its funding obligation by reference in this
agreement, which may include the use of federal matching funds and TCIF funds to the
extent allowable.

California Environmental Quality Act / National Environmental Policy Act Review:
The City is currently undertaking an environmental review for the proposed
redevelopment project, both on the ORA/City property and Port property, including
preparation of a project description, determining the necessary documentation required,
and performing all analysis necessary to properly evaluate the project described. The
City is working closely with the Port on this review. The Port is currently the land-use
authority for its OAB property and other property within the Port Area Line, and nothing
in this term sheet or agreement shall be construed to waive the Port's responsibilities over
its lands under CEQA. However, the City and the Port may enter into an agreement
designating the City as the lead agency under CEQA for purposes of this joint project.
The Port and the ORA/City shall make a good faith effort to reach agreement on the
project description by May 15, 2011. Should the Port and the ORA/City fail to reach
agreement on the project description by May 15, 2011, either party may elect to terminate
this Agreement.

Master Infrastructure Development Planning: Prior to proceeding with detailed
design and construction, the Port and the City will jointly prepare a comprehensive site
study which considers roadway access, intermodal rail terminal footprint including a
track layout, utility service demands and infrastructure needs, a grading and drainage plan
for the site, a grade separation plan for linking the intermodal terminal with the Port's
exisfing Joint Intermodal Terminal, a geotechnical evaluation of soil stability for the
general development concepts, and preliminary development cost estimates for the
project. This work would be funded directly by the ORA/City's Joint Infrastructure
Development Fund. The ORA/City shall be responsible for selecting the appropriate
professionals to perform this work and shall advise the Port of its proposed consultant
team to perform each task. The Port shall have the right to review and approve within ten
(10) working days the qualificafions of each team member prior to their commencement
of any work. Certain components of the Master Infrastructure Development Planning
                                                                             ^
require critical input and design decisions from the Port, particularly the 7 ^ Street Grade
Separation and the rail layout. The Port and the ORA/City agree to cooperate and
coordinate their decision making, design review and approvals in a timely fashion. The
ORA/City and the Port shall promptly deliver to the other copies of their respective
components of such site study for the other's review and comment.

Detailed Design: Following completion of the master infrastructure development
planning tasks, the Port and the City will separately be responsible for detailed design on
a phase-by-phase basis. The Port will be responsible for performing detailed design for
each of its development stages, while the Redevelopment Agency will be responsible for
its own detailed design as well. Given that the Agency and Port plan to engage
development partners to perform the actual construction of infrastructure, the level of




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                                                                          Attachment A~6

detail for the design of each phase of the site will vary, with the exception of work that
either the Agency or Port elect to perform directly at their own risk,.

Construction Activities: Construction activities may include building
demolifion/deconstrucfion, site clearing, grading, soil import, ufility construcfion,
roadway improvements, rail improvements, building construction, paving and other
related activities. To the extent that it is able do so through the generation of matching
funds in addifion to the $32,000,000 idenfified in this Agreement, the Agency will
commit to funding for the Maritime Street reconstruction, backbone utility infrastructure,
         ^^
and the 7* Street grade separation. Unless otherwise agreed between the ORA/City and
the Port, the Port will be responsible for managing the construcfion of the 7'^ Street grade
separafion project, while the ORA/City will be responsible for managing the Maritime
Street reconstruction and backbone utility infrastructure, each subject to the requirements
of the TCIF Baseline Agreements. The Port will be responsible for the funding and
construction of the intermodal rail improvements. The Port and the City agree to manage
their respective construction projects in a manner that minimizes any interference or
disrupfion of exisfing businesses and/or tenant operations on the OAB during
construction.

Redevelopment Agency and City OAB Project(s): Provided that the ORA and/or City
comply with all requirements of the TCIF and/or Baseline Agreements, the Port will
submit reimbursement requests on behalf of the ORA and/or City to CTC up to $62
million in TCIF funds. Should the state deem these costs ineligible, or reduce the Port's
funding allocafion, or refuse to provide funding to the Port for any reason, the Port shall
have no further obligation to provide the Redevelopment Agency with compensation.


V.     Master Infrastructure Development Planning

Before the Agency and the Port can forge ahead with specific projects, a Master Plan
must be developed that the Agency and the Port both agree to in writing to ensure that all
site characterisfics, physical constraints, regulatory requirements, and funding restrictions
are fully known and plotted. Following are among the acfivifies the master planning
process will include:

       A) Conceptual design of the necessary infrastructure up to rough grading
       B) Circulation and traffic plan
       C) Conceptual rail terminal plan
       D) Site ufility relocafion, vacation, and construction plan
       E) Preliminary cost estimates for design and construction
       F) Geotechnical analysis and soil stabilizafion plan
       G) Value engineering recommendations
       H) Green and sustainable development plan




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                                                                        Attachment A—7

VI.   Management of Funds

      A) Cash Flow and Match Analvsis. The ORA and the Port will engage the
      services of an independent economic consulting firm acceptable to both the ORA
      and the Port to create and update cash flow and match requirement models. This
      service is essential to ensure that there are sufficient matching funds on record to
      access the State TCIF at the time needed to cover construction costs, and that
      there are sufficient cash reserves to support construction costs as required under
      and in accordance with the requirements of the TCIF Baseline Agreements.

      B) Cost Reimbursements. Based upon work performed within an approved Scope
      of Work, all funding will be disbursed by the ORA and the Port on a
      reimbursement basis of actual costs incurred by professional services consultants
      and construction contractors.

      C) ORA Fund Management. The ORA will manage its share of the Cost Sharing
      contribution as established through the Joint Environmental Remediation Fund as
      set forth in the ARMOA, the Joint Infrastructure Development Fund, and the
      provisions of this Cost Sharing Agreement. Both parties recognize that the ORA
      has limited resources, $17.8 million ($16.3 million initial commitment to the Joint
      Infrastructure Development Fund, plus $1.5 million from the TIGER II grant) of
      which is scheduled to be expended up front for planning and design to trigger
      reimbursement from TCIF for construction. If and when the Baseline Agreements
      are amended, the ORA shall agree to comply with all provisions of the Baseline
      Agreements and the purposes of the Proposition IB Goods Movement Program
      and the development of its portion of the Army Base.

      D) TCIF Fund Management. The Port is responsible for managing the TCIF grant
      with the CTC and Caltrans, and will instruct the ORA in a timely manner
      regarding match reporting and other grant administration requirements. The ORA
      will comply with all such TCIF match reporting and other grant administration
      requirements.

      E) Use of Third Partv Entifies. The ORA and the Port agree that each shall have
      the right to work cooperatively with other entities, with pre-approval from the
      other Party in wrifing, to expedite the accomplishment of the project.

      F) Allocafion Accounting. The Parties shall, on a quarterly basis, reconcile their
      respective funds to ensure that each Party's contribution was consistent with the
      agreed upon allocations.

      G) Mutual Indemnificafion. Each party will agree to indemnify the other for each
      party's failure to manage its applicable funds in accordance with all applicable
      laws, including without limitafion, the Community Redevelopment Law (as it
      may be amended from time to time), the TCIF program, and the Baseline
      Agreements.




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                                                                        Attachment A—8

VH.   CEQA and NEPA

      The City, as the Lead Agency under California Environmental Quality Act
      (CEQA) for its portion of the OAB, has initiated a CEQA review process for the
      Port-ORA OAB redevelopment project. The Port of Oakland, having land use
      jurisdiction over its portion of the Oakland Army Base, is working closely with
      City in its CEQA review process. The Port and the ORA/City may enter into a
      separate agreement whereby the Port would designate the City as lead agency for
      that portion of the joint project which lies within the Port Area Line. This would
      allow a single CEQA review to be performed for the joint project.

      The acUons contemplated herein comply with the requirements of the CEQA for
      the following reasons, each of which provides a separate and independent basis
      for CEQA compliance: (1) some activities covered under the proposed Cost
      Sharing Agreement have already been evaluated by the previously certified 2002
      EIR, such as hazardous materials remediation; (2) certain activities covered under
      the Cost Sharing Agreement are statutorily exempt from CEQA, such as Planning
      and Feasibility Studies, including detailed design and engineering efforts,
      pursuant to CEQA Guidelines section 15262; (3) the proposed Cost Sharing
      Agreement are merely fhnding mechanisms that are not subject to CEQA,
      pursuant to CEQA Guidelines secfion 15378(b)(4); and (4) this action is exempt
      from CEQA pursuant CEQA Guidelines secfion 15061(b)(3), where it can be seen
      with certainty that there is no possibility that the agreement may have a
      significant effect on the environment.

      Specifically, the proposed Cost Sharing Agreement does not constitute an
      approval by the Agency of the proposed project and the subsequent approval of
      any specific project by the Agency Board is subject to CEQA, where applicable.
      In particular, the Agency reserves all of its rights and duties under CEQA with
      respect to the proposed Army Base project, including without limitafion the
      authority to do any and all of the following: (a) prepare an environmental study
      evaluating the impacts of the proposed project, feasible altemafives to the project,
      and feasible mitigation measures; (b) adopt any feasible alternatives and/or
      feasible mifigation measures to lessen any significant environmental impacts
      resulting from the proposed project; (c) determine that any significant
      environmental impacts of the proposed project that cannot be mitigated are
      acceptable due to project benefits overriding any significant unavoidable impacts;
      and/or (d) decide to modify or deny its approval of the proposed project, and not
      to proceed with the project, due to the results/findings of the CEQA process.
      After complefion of the CEQA process, the specific project shall return to the
      Agency Board for its consideration based upon the foregoing.




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                                                                MAJOR PROJECTS Tab 2.3

                                                                         Attachment A—9

VIII.    Future Federal, State and Other Funds

The ORA and the Port agree to cooperate with one another and with the ORA master
developer (and at such fime as the Port selects a master developer, the Port's master
developer) in making application for future federal and state funding to match the TCIF
funds. The ORA and Port agree to cooperate in seeking to obtain private investments in
the OAB that could further leverage TCIF funds. The ORA and the Port each agree that
such cooperation shall not require either party to make any expenditure of funds or
resources without the prior approval of such party's legislative body.


IX.     General

While this term sheet summarizes certain essential terms of the proposed Cost Sharing
Agreement, it does not set forth all of the material terms and condifions of the
Agreement. This term sheet is not intended to be, and will not become, contractually
binding on the Agency or the Port, and no legal obligafion will exist unless and unfil the
parties have negotiated, executed and delivered a mutually acceptable Cost Sharing
Agreement based upon the express approval of each such governing body.


                                           [End]




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                                                                      MAJOR PROJECTS Tab 2.3

                                                                                   Approved as to Form and Legality,



i)FFiCt   Of THE CiT        I'-ttiH^                                                                  City Attorney
           0 A y. L f:UO


   01 A
  2 1 H R 17 PH 5:3U
                                  OAKLAND CITY COUNCIL
                           RESOLUTION N O .                             C.M.S.


            RESOLUTION AUTHORIZING THE CITY ADMINISTRATOR TO
            NEGOTIATE AND EXECUTE A COST SHARING AGREEMENT
            BETWEEN THE CITY AND THE PORT OF OAKLAND FOR THE
            DEVELOPMENT OF INFRASTRUCTURE INCLUDING PUBLIC
            UTILITIES AND PUBLIC STREETS ON THE FORMER OAKLAND ARMY
            BASE

           WHEREAS, the Redevelopment Agency and the Port of Oakland own respective parcels
   of the former Oakland Army Base; and

          WHEREAS, the City may assume ownership of the Agency's portion of the former
   Oakland Army Base, including the assumption assets and liabilities associated with the
   environmental remediation and economic redevelopment of the property; and

           WHEREAS, the Oakland Army Base Reuse Plan and 2002 Environmental Impact
   Report document the need to install all new public utilities and streets to serve new development
   of the former Oakland Army Base; and

          WHEREAS, the cost for new rail and street systems, utilities, streets, open space, and
   safe public access is estimated at $500,000,000; and

           WHEREAS, the Agency Board adopted Resolufion No. 2010-0088 C.M.S., authorizing
   the establishment of an Army Base Joint Infrastructure Development Fund in the initial amount
   of $16,300,000; and

           WHEREAS, the Agency Board adopted Resolution No. 2010-0049 C.M.S., authorizing
   the establishment of a Army Base Joint Environmental Remediation Fund with an Agency
   contribufion of $5,741,477, matched by Port of Oakland contribufions of an addifional
   $5,741,477 to share the costs of required environmental remediation on the former Oakland
   Army Base; and

          WHEREAS, the Agency has been awarded a $2,000,000 TIGER II grant from the U.S.
   Department of Transportafion, $1,600,000 of which will go direcfiy towards infrastructure
   planning and design for the former Army Base, with a match requirement of up to $3,010,000;
   and

           WHEREAS, the Port of Oakland has been awarded an allocation of more than
   $242,000,000 in State Trades Corridor Improvement Funds to be used for the construction of
   infrastructure improvements within the East and Central Areas of the former Oakland Army
   Base;



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                                                                     MAJOR PROJECTS Tab 2.3

        WHEREAS, the Agency Board adopted Resolufion No. 2010-0089 C.M.S., authorizing
the Agency Administrator to negotiate a Cost Sharing Agreement with the Port of Oakland to
improve rail and surface transportation systems and public utilities that are essential to attract
private investment for the development of the former Army Base to its best and highest use; now,
therefore be it

       RESOLVED: That the City Administrator is authorized to execute a Cost Sharing
Agreement with the Port of Oakland for the development of infrastructure and other
improvements on the former Oakland Army Base committing an inifial total Sixteen Million
Three Hundred Thousand dollars ($16,300,000) of Agency Fund 9572 to the development, in
addition to the $5,700,000 already approved for the Joint Environmental Remediation Fund
9579; and be it

        FURTHER RESOLVED: That the City shall appropriate and allocate up to an
addifional $10,000,000 in Army Base Redevelopment Area Tax funds (9570) over the course of
FY 2011 -2012 through FY 2018-2019 through its role as the successor to the Oakland
Redevelopment Agency for specific infrastructure planning, design and construction projects
within the East and Central Gateway Areas of the former Army Base; and be it

       FURTHER RESOLVED: That up to $3,010,000 of the $10,000,000 will be used to
Match the Federal TIGER II grant award for infrastructure development master plarming; and be
it

        FURTHER RESOLED: That the City is authorized by way of the Cost Sharing
Agreement to accept up to $62,000,000 in Port of Oakland Trades Corridor Improvement Funds
over the course of the Agreement for the construction of infrastructure and other site preparadon
projects within East and Central Gateway Areas; and be it

        FURTHER RESOLVED: That this action comphes with the California Environmental
Quality Act (CEQA) for the following reasons, each of which provides a separate and
independent basis for CEQA compliance: (1) some activities covered under proposed Cost
Sharing Agreement have already been evaluated by the previously certified 2002 EIR, such as
hazardous materials remediation; (2) certain activides covered under the proposed Cost Sharing
Agreement are statutorily exempt from CEQA, such as Planning and Feasibility Studies,
including detailed design and engineering efforts, pursuant to CEQA Guidelines section 15262;
(3) the proposed Cost Sharing Agreement includes funding mechanisms that are not subject to
CEQA, pursuant to CEQA Guidelines section 15378(b)(4); and (4) this action is exempt from
CEQA pursuant CEQA Guidelines section 15061(b)(3), where it can be seen with certainty that
there is no possibility that the project may have a significant effect on the environment; and be it

        FURTHER RESOLVED: That the Environmental Review Officer shall cause to be
filed appropriate Notices of Exempfion/Determinafion; and be it




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                FURTHER RESOLVED: That the City Administrator and his or her designee is
        authorized to take whatever action is necessary with respect to negotiating and executing a Cost
        Sharing Agreement with the Port of Oakland in support of the development of public
        improvements on the former Oakland Army Base consistent with this Resolution and its basic
        purposes.



IN COUNCIL, OAKLAND, CALIFORNIA,                                    , 2011

PASSED BY THE FOLLOWING VOTE:

AYES - BROOKS, BRUNNER, DE LA FUENTE, KAPLAN, KERNIGHAN, NADEL. SCHAAF and PRESIDENT
REID

NOES-

ABSENT -

ABSTENTION -
                                                            ATTEST:
                                                                              LaTonda Simmons
                                                                      City Clerk and Clerk of the Council
                                                                       of the City of Oakland, California




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 O r F i C t Of THE ClT               i.:; ^Rf
                          •
                          '
              0 •': f: L >, \ i [',                               Approved as to form and legajjl^

   2011 H R 17 PM 5:36
         A                                                          ^ i l ' ^          ^-T
                                                                           As^ncy Counsel



                                        REDEVELOPMENT AGENCY
                                        OF THE CITY OF OAKLAND
                                      RESOLUTION NO.        CM.S



           RESOLUTION AUTHORIZING THE AGENCY ADMINISTRATOR TO
           NEGOTIATE AND EXECUTE A COST SHARING AGREEMENT
           BETWEEN THE REDEVELOPMENT AGENCY AND THE PORT OF
           OAKLAND FOR THE DEVELOPMENT OF INFRASTRUCTURE
           INCLUDING PUBLIC UTILITIES, AND PUBLIC STREETS ON THE
           FORMER OAKLAND ARMY BASE


        WHEREAS, the Redevelopment Agency and the Port of Oakland own respective
parcels of the former Oakland Army Base; and

       WHEREAS, the Oakland Array Base Reuse Plan and 2002 Environmental
Impact Report document the need to install all new public utilities and streets to serve
new development of the former Oakland Army Base; and

       WHEREAS, the cost for new rail and street systems, utilities, streets, open space,
and safe public access is estimated at $500,000,000; and

         WHEREAS, the Agency Board adopted Resolufion No. 2010-0088 C.M.S.,
authorizing the establishment of an Army Base Joint hifrastructure Development Fund in
the inifial amount of $16,300,000; and

       WHEREAS, the Agency Board adopted Resolufion No. 2010-0049 C.M.S.,
authorizing the establishment of a Army Base Joint Environmental Remediation Fund
with an Agency contribufion of $5,741,477, matched by Port of Oakland contributions of
an additional $5,741,477 to share the costs of required environmental remediation on the
former Oakland Army Base; and

        WHEREAS, the Agency has been awarded a $2,000,000 TIGER II grant from
the U.S. Department of Transportafion, $1,600,000 of which will go direcfiy towards
infrastructure planning and design for the former Army Base, with a match requirement
ofup to $3,010,000; and




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                                                               MAJOR PROJECTS Tab 2.3




       W H E R E A S , the Port of Oakland has been awarded an allocation of more than
$242,000,000 in State Trades Corridor Improvement Funds lo be used for the
conslruction of infrastructure improvements within the East and Central Areas of the
former Oakland Army Base;

        W H E R E A S , the Agency Board adopted Resolution No. 2,010-0089 C.M.S.,
authorizing the Agency Administrator lo negotiate a Cost Sharing Agreement with the
Port of Oakland to improve rail and surface transportafion systems and public ufilifies
that are essential to attract private investment for the development of the former Army
Base to its best and highest use; now, therefore be it

        R E S O L V E D : That the Agency Administrator is authorized to execute a Cost
Sharing Agreement with the Port of Oakland for the development of infrastructure and
other improvements on the former Oakland Army Base commitfing an initial total
Sixteen Million Three Hundred Thousand dollars ($16,300,000) of Agency Fund 9572 lo
the development, in addition to the $5,700,000 already approved for the Joint
Environmental Remediation Fund 9579; and be it

       F U R T H E R R E S O L V E D : That the Agency shall appropriate and allocate up lo
an addifional $10,000,000 in Army Base Redevelopment Area Tax Increment funds
(9570) over the course of F Y 2011-2012 through FY 2018-2019 through the
Redevelopment Agency Policy Budget process for specific infrastructure planning,
design and construction projects within the East and Central Gateway Areas of the former
Army Base; and be it

       F U R T H E R R E S O L V E D : That up to $3,010,000 of the $10,000,000 will be used
to Match the Federal TIGER II grant award for infrastructure development master
planning; and be it

        F U R T H E R R E S O L E D : That the Agency is authorized by way of the Cost
Sharing Agreement to accept up to $62,000,000 in Port of Oakland Trades Corridor
Improvement Funds"over the course of the Agreement for the construction of
infrastructure and other site preparation projects within East and Central Gateway Areas;
and be it

        F U R T H E R R E S O L V E D : That this action complies with the California
Environmental Quality Act (CEQA) for the following reasons, each of which provides a
separate and independent basis for CEQA compliance: (1) some activities covered under
proposed Cost Sharing Agreement have already been evaluated by the previously
certified 2002 EIR, such as hazardous materials remediation; (2) certain activities
covered under the proposed Cost Sharing Agreement are statutorily exempt from CEQA,
such as Planning and Feasibility Studies, including detailed design and engineering
efforts, pursuant to CEQA Guidelines section 15262; (3) the proposed Cost Sharing
Agreement includes funding mechanisms that are not subject to CEQA, pursuant to
CEQA Guidelines section 15378(b)(4); and (4) this acfion is exempt from CEQA




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                                                                 MAJOR PROJECTS Tab 2.3




pursuant C E Q A Guidelines secfion 15061(b)(3), where it can be seen with certainty thai
there is no possibility that the project may have a significant effect on the environment;
and be it

         F U R T H E R R E S O L V E D : That the Environmental Review Officer shall cause
to be filed appropriate Notices of Exemption/Determination; and be it

        F U R T H E R R E S O L V E D : That the Agency Administrator and his or her
designee is authorized to take whatever action is necessary with respect to negotiating
and executing a Cost Sharing Agreement with the Port of Oakland in support of the
development of public improvements on the former Oakland Army Base consistent with
this Resolufion and its basic purposes.


IN AGENCY, OAKLAND, CALIFORNIA,                               , 2011


PASSED BY THE FOLLOWING VOTE:

AYES - BROOKS, BRUNNER, DE LA FUENTE, KAPLAN, KERNIGHAN, NADEL, QUAN,
SCHAAF, AND CHAIRPERSON REID

NOES-

ABSENT-

ABSTENTION -

                                              ATTEST:

                                              LATONDA SIMMONS
                                              Secretary of the Redevelopment Agency
                                              of the City of Oakland, California




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                                      BUDGET & FINANCE Tab 3



                  BUDGET & FINANCE
This segment of the meeting is reserved for action or
discussion regarding the status of Budget and Finance
issues.




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                                      STRATEGY & POLICY Tab 4



                  STRATEGY & POLICY
This segment of the meeting is reserved for action or
discussion on Strategy and Policy Issues.




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Strategy and Policy

     Port of Oakland
       Strategic Plan
 Fiscal Years 2011-2015

    Progress Report #2

Board of Port Commissioners
 Tuesday, March 29, 2011



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  Strategic Plan Progress Report #2: Tasks and Status

                TASK                          STATUS                           COMMENTS

Progress Report #1 to Board             November 16, 2010         Report to Board on status and results
                                                                  of 43 Implementing Actions (IAs).
Port Senior Management Strategy         November 19, 2010         Priority Implementing Actions and
Review Session #1                                                 Strategic Initiatives identified.
Finalize Strategic Plan Documents       Jan 2011-March 2011       Final plan documents posted to Port
                                             (completed)          website on March 18, 2011.
Update Implementing Actions           Jan 2011-February 2011      43 Project Plans updated by Port
(Monitoring and Reporting, p. 12)           (completed)           project managers.
Analyze Implementing Actions         February 15-March 18, 2011   Review trends, progress, variances,
(Monitoring and Reporting, p. 12)                                 course corrections (as needed).
Port Senior Management Strategy           March 23, 2011          Review of Progress Report #2.
Review Session #2
Progress Report #2 (Monitoring and        March 29, 2011          Staff to present results and analysis
Reporting, p. 12)                                                 to Board and public
FY 2012 Plan Update (Updating the      March 2011-June 2011       Develop FY 2012 Implementing
Plan, p. 12)                                                      Actions concurrent with FY 2012
                                                                  budget preparation process.
Annual Report on Stage I (FY 2011)           July 2011            Present Annual Report and FY 2012
and Stage II (FY 2012) Plan Update                                Plan Update to Board and public.
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Strategy Review Session #1 (Nov 19, 2010) – Priority Strategic Initiatives


Strategic Plan FY 2011 Implementing Actions

   Bond Refinance
   Trade and Logistics Center (TLC) at former Oakland Army Base (OAB)
   Shore Power Funding
   Oak-Ninth Project
   Fixed-Base Operators (FBOs) at North Field
   External Funding and Other Grant Sources
   Workforce Studies
   Change Management Program
   Labor Management Partnership Committee
   Enterprise Resource Planning (ERP) – Phase I

Other (Not included in FY 2011 Implementing Actions)

   Dredging Program
   MOU with China Merchants Holdings International Co. Ltd. (CMHI)
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                                                                STRATEGY & POLICY Tab 4.1




Strategic Plan - Achievements since Progress Report #1 (Nov 2010)



Sustainable Economic and Business Development

   Made significant progress in preparing for bond refinance; decision made not to pursue
   until market conditions improve.
   Closed lease with Dealey Renton for 7th floor of 530 Water Street and tenant moved in.
   Obtained additional $5 Million in funding for Shore Power program, bringing total to
   $12.85 million.
   Tenants, including Southwest Airlines, TSA, and Host, participated in the Annual Customer
   Service awards breakfast in December 2010 with several tenant employees
   acknowledged for outstanding customer service.
   Aviation Marketing: Completed a new suite of ads for the Airport. Cooperative
   advertising plan with Alaska Airlines (New Hawaii Service) completed for Spring 2011.
   Cooperative internet advertising for Free Parking air service promotion with Southwest
   Airlines and jetBlue completed.
   New Air Service to Mexico City (Volaris) and Kona, Hawai’i (KaiserAir, Inc.)
   Maritime Marketing: Engaged with key commodity associations. Met with Wine Institute;
   presented to Specialty Crop Trade Council; and sponsored 2 trade workshops.
   Building partnership with China Merchants Holdings International Co. Ltd. (CMHI)



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Strategic Plan - Achievements since Progress Report #1 (Nov 2010)


Stewardship and Accountability

   External Funding: Obtained $33 Million in funding for Oakland
   International Airport (OAK)

Port Workforce and Operations

   Initiated scoping process for Port-wide Disaster Recovery Plan.
   Priority Hires: External Affairs, Corporate Administration and Labor
   Advisor (January 2011).

Communications and Information
  Conducted a well-attended 2011 “State of the Port of Oakland”
  briefing on February 10, 2011.

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Progress Report #2 – Summary by Strategic Priority Areas


  Strategic Priority      Total            0-25%            26%-50%          51%-75%    76%-100%
  Area                    Implementing
                          Actions (43)

  Sustainable Economic    25               3                9                8          5
  and Business
  Development
                                           (5)              (15)             (3)        (2)

  Stewardship and         2                                 1                           1
  Accountability
                                                            (1)                         (1)

  Port Workforce and      8                3                4                           1
  Operations
                                           (5)              (2)                         (1)

  Communications and      8                2                3                           3
  Information
                                           (3)              (3)              (1)        (1)



(n) Number of Implementing Actions in each category as of end of 1st Quarter FY 10-11


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Strategic Plan - Progress Report #2




            Comments?

                        Questions?




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                                              MEMORANDUM

TO:            Omar Benjamin, Executive Director
FROM:          Isaac Kos-Read, Director of External Affairs
               Eve Grossman Bukowski, Manager of Government Relations
               Matt Davis, Government Affairs Representative
RE:            Government Funding & Advocacy Update
DATE:          March 15, 2011

EXECUTIVE SUMMARY
This report is to provide a framework, update, and proposed strategic action plan for the public
sector funding and advocacy initiatives of the Port of Oakland. The unifying goal of all of our
proposed advocacy efforts is Goal F of the twelve Prioritized Goals of the FY 2011-2015 Strategic
Plan: “Aggressively obtain maximum amount of external grant and government funding and
regulatory relief.” At the local level, through our interactions with city and county government; at
the regional level through collaboration with regional planning agencies; at the state and federal
levels of government; and even at the transnational and international government – the unifying
theme of our efforts is to increase funding via grants or other funding mechanisms (e.g. “P3’s” or
public-private partnerships, as well as low-interest loans, etc.) and lower our costs, via better
public policy and improved regulatory requirements. This plan was developed by the Government
Affairs team in consultation with the Executive Director, Director of External Affairs, and additional
senior management and Port team members with expertise in specific policy areas.
The over-arching goal of the plan is supported by three specific objectives also detailed in the
Strategic Plan:
    1. Seek out and pursue all promising and prospective grants and external funding resources.
    2. Partner with other agencies to create joint grant and advocacy strategies.
    3. Enhance governmental affairs outreach efforts and capacity.
These strategic objectives will guide the work of the Government Affairs team as it directly
interacts with and supports engagement by the entire Port with every level of government.
While the comprehensive plan is extensive, the Port’s advocacy efforts are primarily focused on a
few core issues related to enhancing land-side and water-side infrastructure of the airport,
seaport, and commercial real estate assets, and increasing volume (e.g. passenger, cargo,
shopper/diner, etc.) through these assets. The following table presents our proposed top three
priorities across four interrelated levels of government:

 Priority     Local/Regional                 State                     Federal           Inter/Trans-national
                                     Proposition 1B Trade                                North American
            Trade/export and         Corridor                                            region-wide
      1                                                        Maintenance dredging
            investment promotion     Improvement Funds                                   environmental
                                     (TCIF)                                              standards
                                                               National Goods
            Regional                                                                     Government support
                                                               Movement Policy/Surface
            collaboration on         Proposition 1B Air                                  required to secure
      2                                                        Transportation
            transportation funding   Quality Funds                                       new international air
                                                               Authorization for TCIF
            and policy                                                                   service
                                                               matching funds
            Regional support on      Business-supportive       Environmental             Government support
      3     competitiveness          legislation/regulations   program/project funding   for enhanced trade
            issues (e.g. dredging)   and budget proposals      and policy                and exports


                                                Page 1 of 17


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The remainder of this report is focused on providing additional detail on these priorities and the
strategy to address them, as well as additional issues that, while not among the Port’s top three,
are necessary to keep on the agenda.
To understand how Port staff arrived at these priority recommendations as well as the proposed
strategy going forward, it is worth reviewing the attached Background on Previous Advocacy
Efforts (Attachment 1) and Current Context (Attachment 2).

DETAILED SUMMARY OF STATE & FEDERAL ADVOCACY ISSUES

Within a context of fiscal austerity and competing state and national spending priorities, the Port
is continuing to move forward with its advocacy for many long-standing key projects for both the
seaport and the airport. Below is a discussion of the legislative and/or regulatory vehicles that will
shape our actions over the next two years as they concern several of the key projects and
priorities identified by the Governmental Affairs team, in consultation with the Port’s revenue
divisions:

FEDERAL LEGISLATION

Surface Transportation Reauthorization Act (Highway Bill)
Progress on this legislation has been hampered by an inability to achieve consensus on new
revenue mechanisms, such as an increase in the federal gas tax. In early March, the Congress
passed legislation to extend the SAFETEA-LU Programs through the end of the fiscal year,
September 30, 2011. This means that while Congress tries to move a surface transportation
authorization this spring and summer they will not also have to worry about passing short term
extensions of the existing programs.
 As the House and Senate continue to grapple with the larger, longer-term bill, without a
consensus on new sources of revenue, there appears to be little hope of a $500+ billion multi-
year authorization as originally envisioned at the start of the 111th Congress by the Obama
Administration. This legislation would likely contain the greatest source of opportunities for major
public works and infrastructure development priorities at the Port of Oakland (e.g. the
development at the former Oakland Army Base and the 7th Street Grade Separation).
One item of note is that in the President’s FY2012 budget, it discusses that the bill should focus
on national projects utilizing the following example: “For example, improvements in road and rail
access to a West Coast port benefits farmers in the Midwest….” These words echo points that
we have advocated for via our collaboration with the U.S. West Coast container ports and
demonstrate an understanding that assistance to a port like Oakland will have national
significance. As Congress puts together the next highway bill, we will work closely with the US
DOT and the Senate Committees of jurisdiction (Environment and Public Works, chaired by Sen.
Barbara Boxer; and Senate Commerce, Science and Transportation) and the House Committees
of jurisdiction (Transportation and Infrastructure, chaired by Rep. John Mica; and Ways and
Means) to see that there are programs placed in the bill that can translate that vision into reality.
In addition, there has been a proposal for a “One CA” program initiated by the California
Transportation Commission which intends to propose a new block funding program for states that
would mirror, in many ways, the TIGER program. Its goal would be to focus on strategic
infrastructure investments throughout the state that would also include multi-modal connections to
trade gateways, including seaports and airports. The Executive Director, Director of Engineering,
Director of External Affairs, and GA team have all been involved in this effort.




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Water Resources Development Act (WRDA):
This legislation, which is passed approximately every two years (but often less frequently),
authorizes new studies and construction projects undertaken by the U.S. Army Corps of
Engineers. The last full WRDA bill passed by the Congress was in 2007 – thus there is a backlog
of project authorizations throughout the country that await consideration through the legislative
process. There are two major port priorities for consideration under a new WRDA bill:
       Authorization for the modernization of the OAK Perimeter Levee. Note – this would not
        provide immediate funding, but would authorize future appropriations.
       Elimination of an increased local cost-share for deep-draft maintenance dredging projects
        such as those at the Port of Oakland.

Energy & Water Appropriations/Harbor Maintenance Tax/Harbor Maintenance Trust Fund:
Federal funding for maintenance dredging nationwide is provided through an ad-valorem tax on
import cargo at our nation’s seaports (the Harbor Maintenance Tax, or HMT). Currently, while
activity at California ports result in a contribution of approximately 34 percent of the annual
Harbor Maintenance Trust Fund, CA ports do not receive adequate maintenance dredging funds
in return – only about 4 percent of the annual disbursements from the HMT. Several bills have
been introduced in Congress to ensure that HMT funds are spent every year on maintenance
dredging projects. (Please note: these are discussed specifically in the state and federal
legislation section of the report.)

Federal Aviation Administration Authorization Act:
This legislation authorizes all spending for airports, including formula and discretionary grants
through the Airport Improvement Program (AIP), as well as fees that airports can collect through
Passenger Facility Charges (PFCs). OAK’s major goal with this legislation has been an increase
in the amount of the PFC that can be collected, currently frozen at $4.50. Increasing the PFC to
$7.00 would allow critical airport projects to move forward more quickly, create jobs, and ensure
that OAK remains competitive in the Bay Area. Also at issue is a potential increase in landing
slots into Washington Reagan National Airport (DCA), which could be an air service marketing
opportunity for OAK and its air carriers. Rep. Barbara Lee has been following such air service
opportunities closely, including a potential expansion of air service to Cuba following the
Administration’s decision to relax travel restrictions over airports that can offer charter flights to
that country.
House Transportation and Infrastructure Committee Chairman Mica announced recently his
intentions to move his FAA Reauthorization bill to the House Floor before the end of March.
Despite the competing demands from the continuing resolutions and other bills, if Mica has his
work completed on the committee, he will probably be able to bring the bill before the House. We
would then expect the conference with the Senate to occur within the 60 days after House
passage. The exact timing will depend on multiple issues, including floor schedules in both
chambers and the success of preliminary staff negotiations.
The Port’s lobbying team, in concert with other major passenger service airport throughout the
country, is in the process of formulating next steps with regard to the Administration’s efforts to
support a PFC increase, which include the following:
       Providing the detailed jobs and economic information to the White House
       Drafting and placing an editorial in a leading paper by large city mayors in support of the
        PFC
       Requesting a meeting with President Obama’s Chief of Staff William Daley and/or
        Secretary LaHood with the large city mayors.

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With the Senate, our next steps will include:
      Coordinating with other leading pro-PFC airports to target potential conferees for the FAA
       conference and Senators who would be willing to call or write conferees
      Working with the airport trade associations to brief conservative Senators (particularly new
       members) on the merits of PFC increases.
With the House, our next steps will include contacting the ranking Democrats and coordinating
our PFC conference strategy with them.

Diesel Emissions Reduction Act (DERA)
In January 2011, President Obama signed the Diesel Emission Reduction Act (DERA) of 2010
(HR 5809), which reauthorizes DERA for another five years. This program provides funding for a
range of diesel emissions reduction activities, including support for shore power and truck engine
replacements and retrofits. While it is authorized at $100 million dollars per year, is typically
underfunded by both the Administration and the Congress. The Port will continue to work with
industry partners to increase the amount of funds appropriated for this critical program.

ADMINISTRATION INITIATIVES AND OUTREACH

Oakland Army Base
One of the unifying projects that will be the focus of our advocacy at nearly every level of
government is the former Oakland Army Base. In addition to the opportunities already noted,
especially our focus on the federal Highway Bill, Port staff, in coordination with the lobbying team
and our regional partners, will engage in the following activities to obtain matching funds for the
Oakland Army Base project:
      Railroad Rehabilitation & Improvement Financing (RRIF): The Federal Railroad
       Administration (FRA) has legislative authority to loan up to $38 billion for rail projects
       including the type of project envisioned at the former OAB site. While currently this is a
       low-interest financing opportunity and not a grant, it is one that both potential developers
       and rail partners have considered, and one which may prove more fruitful as Congress
       looks at ways to provide funding to nationally-important infrastructure with limited new
       revenue options.
      Transportation Infrastructure Finance and Innovation Act (TIFIA): The Transportation
       Infrastructure Finance and Innovation Act (TIFIA) program provides Federal credit
       assistance in the form of direct loans, loan guarantees, and standby lines of credit to
       finance surface transportation projects of national and regional significance. TIFIA credit
       assistance provides improved access to capital markets, flexible repayment terms, and
       potentially more favorable interest rates than can be found in private capital markets for
       similar instruments. TIFIA can help advance qualified, large-scale projects that otherwise
       might be delayed or deferred because of size, complexity, or uncertainty over the timing of
       revenues. Many surface transportation projects - highway, transit, railroad, intermodal
       freight, and port access - are eligible for assistance. Each dollar of Federal funds can
       provide up to $10 in TIFIA credit assistance and leverage $30 in transportation
       infrastructure investment.
      Additional Regional & State Funding and Transportation Planning: Port staff will
       continue to pursue additional local, regional and state transportation planning initiatives to
       ensure that all available avenues of potential funding are examined for applicability for the
       Oakland Army Base project. This may include Tax Increment Financing available through

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       the City’s Redevelopment Agency, State Highway Operation and Protection Program
       (SHOPP) funding through CalTrans, inclusion in the Alameda Countywide Transportation
       Plan (prepared by the Alameda County Transportation Commission), the Regional
       Transportation Plan (prepared by the Metropolitan Transportation Commission), and the
       State Transportation Improvement Plan (adopted by the California Transportation
       Commission).
      Target the HUD Economic Development Initiative (EDI) program and the Commerce
       Economic Development Administration (EDA) grants: Both programs have broad eligibility
       requirements and target job and business creating projects with public sponsors. We
       propose to work in coordination with the City of Oakland to pursue support from the local
       EDI and EDA offices for larger scale grants to advance the Army Base project. This will
       include:
           o Collecting congressional support letters and request congressional contacts at
             senior levels in the Administration.
           o Pursuing an agency lobbying campaign to affect the local, regional and
             headquarters offices of both Departments.
      Follow a similar strategy with the Environmental Protection Agency: EPA grants for
       improving water quality, wetlands mitigation, Brownfields remediation and removal of
       underground storage tanks are all largely earmarked by Congress. Absent earmarks, the
       EPA Administrator will have significant discretionary funds to award to meritorious
       projects, such as for the former Oakland Army Base redevelopment.
           o We will need to have a clearly defined need for each category of grant (e.g.,
             identifying a specific need to remediate contaminated soil under the Brownfields
             program or a leaking underground storage tank).
           o We would follow the same agency and congressional lobbying plan as noted above
             and also conclude with outreach directly to the Administrator’s office. This will
             include recommending the creation of a grant application package that would
             address the environmental work required under the previous redevelopment
             proposal.

Oakland Harbor Dredging
Although the -50 Foot Dredging Project was completed in 2009, an ongoing challenge for the
U.S. Army Corps of Engineers and the Port is to maintain the federal navigation channel at its
authorized depth. The -50 foot depth is critical to attracting first port of call service and to allow
the next generation of container vessels to serve Oakland. Limited funding availability for the
Corps’ San Francisco District (as well as overall funding for the Corps’ overall budget), high
disposal costs, a higher-than-expected volume of dredged material, and regulatory restrictions for
when dredging can take place have all contributed to several “high spots” in the channel that
could limit larger ship calls in Oakland. An additional priority is to ensure that the Port is able to
secure $2.1 million in repayment for the -42 Foot project from the Corps.
Currently, we are collecting signatures for a joint delegation letter to the Corps of Engineers
requesting that they provide funding both for needed operations and maintenance dredging as
well as the $2.1 million reimbursement for the -42 foot project.




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Shorepower
The Port has aggressively pursued local, regional, state and federal funding to support the
mandates of the California Air Resources Board’s shore power regulation. Current efforts have
included the US DOT TIGER grant and, in partnership with the Maritime Division, the recently
secured Bay Area Air Quality Management District grant. There may be additional federal funding
available from the Environmental Protection Agency and the Department of Energy to minimize
the financial burden on the Port. For example, we have a pending grant application for DERA
funding for shorepower.

National Export Initiative
Last year the President announced his intention to double the amount of U.S. exports – improving
the connectivity by highway and rail to American seaports will be critical in ensuring that this goal
can be achieved. The Port has been working with the Department of Commerce, which has
taken the lead on this initiative, to identify opportunities to highlight and promote critical
investments in the supply chain to achieve this objective.

Local Workforce Initiatives
The Port is involved in an ongoing dialogue with U.S. DOT over the ability of the Port to include
the Maritime and Aviation Project Labor Agreement (MAPLA) on federally-funded transportation
projects due to DOT concerns about local-hire goals. The Port, along with its MAPLA
stakeholders, have asked DOT to consider an innovative pilot project that would permit the
application of local-hire provisions in a demonstration project that would ensure that there are no
anti-competitive effects of these local-hire goals.

STATE ISSUES

Trade Corridor Improvement Fund (Proposition 1B) Support for Trade & Logistics Center
The Port has secured approximately $242 million in state funding through the Trade Corridor
Improvement Fund (TCIF), passed by voters in 2006 and administered by the California
Transportation Commission (CTC). The Port must continue to demonstrate progress towards
initiating construction on its two TCIF projects, the 7th Street Grade Separation and the Outer
Harbor Intermodal Terminal, by 2013, to ensure funding for the Port and City’s goal of developing
the former Oakland Army Base. We recently conducted a meeting with the CTC, MTC, and
Caltrans to prepare our updated agreement, which will go to the CTC at its fall 2011 meeting.

Shorepower
In addition to the federal efforts, the Port of Oakland has been involved in obtaining a mix of
regional (Bay Area Air Quality Management District Mobile Source Incentive Funding, as well as
regional pass-through funding through a Metropolitan Transportation Commission Innovation
grant) and state (Proposition 1B Emissions Reductions Program) funding support for the Port’s
planned investments. Additional efforts are underway to facilitate expediting the state and federal
funding and to reduce the regulatory burden of compliance with the rule.

ADDITIONAL STATE AND FEDERAL LEGISLATION

Every year, there are thousands of pieces of legislation introduced at the state and federal
levels of government. The GA team, through its state and federal lobbying consultants and
through trade associations, maintains a tracking list of individual bills as they are introduced
and considered by the state and federal legislatures. The Port of Oakland is operating in a
dynamic and fast-paced legislative and regulatory environment in both Sacramento and

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Washington, DC, and as such the schedule and format of the Board meetings may not
always lend themselves well to a full and thorough discussion of individual and time-sensitive
policy matters. Pursuant to previous Board discussions on this matter, the Executive
Director, in consultation with the Board President and/or Executive Committee, has the
authority to approve policy matters such that they are consistent with existing Port policy and
objectives for maritime, aviation, commercial real estate, and general port operations. The
Executive Director and/or staff will also be prepared to report out on a regular basis any
significant legislative and/or policy items at each Board meeting. Additionally, included in
Attachment 3 of this report is a brief reference to some highlighted state and federal
legislative items that have been introduced thus far in each respective legislative session.
This is not a comprehensive list, but instead is provided so as to allow for an overview of
some of the major initiatives that might generate additional policy discussions.

PROPOSED ACTION PLAN:

Aggressive Collaboration and Education Efforts
Strong coalition building with community, tenant and government allies will be critical to success.
As with all governmental affairs efforts, the education of stakeholders and coalition members will
be instrumental to creating a solid advocacy voice. We currently maintain strategic advocacy
partnerships with 20 different organizations (see Attachment 4). We are renewing and expanding
some of these partnerships, and ensuring that we are maximizing the value from all of them
without diluting our message.
At the state level, the always-changing Legislature in the era of term limits creates opportunities
and challenges for the Port. Each new session brings a class of roughly 30 new Legislators and
we have aggressively pursued these new Members to educate them about the Port of Oakland.
Port tours and briefings are labor intensive activities that involve government affairs and Port
leadership staff. Several new legislators, as well as the State Controller, have already visited the
port early in this session. We expect to see an increase in these briefings the next two years as
we broaden our network of supporters by pro-actively reaching Legislators and the new
administration.

Direct Advocacy with Key Stakeholders
For several years, the Port of Oakland brought key stakeholders with us to Washington, including
the agricultural, labor, environmental and business communities. This was an extremely effective
tool in demonstrating to Members of Congress the importance of Port projects and its far-
reaching impact. We recommend that this effort be reinvigorated over the next two years.
In addition, we have re-launched an aggressive outreach effort to our agricultural partners that
will help us increase exports through the Port. Their relationships will be vital for our efforts in
both DC and Sacramento. After meeting with several influential agricultural trade association
heads at the end of February, we outlined and are implementing the following actions:
   1. Work with the Agricultural community to continue our outreach to newly elected
      Congressman Jeff Denham (R-Merced), who is now the member of the Transportation &
      Infrastructure Committee with the closest district to the Port (formerly it was Rep.
      Garamendi, who is no longer on the committee). Rep. Denham is also an almond farmer
      who ships through the Port.
   2. Work with our agricultural partners to request support from the Boards of Supervisors of all
      eight Central Valley counties in support of the Port’s maintenance dredging funding and
      landside infrastructure funding.



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   3. We will host our agricultural partners and Members of Congress in May for a Port tour and
      meetings around export promotion; as well as meetings with the Mayor and ILWU, two
      specific requests by our agricultural partners.
   4. We will travel to DC with the Nisei Farmers League to conduct joint visits with Members of
      Congress regarding our mutual interests.

Securing Local Funding in an Era without Earmarks
How the debate over the continued use of earmarks in the annual appropriations process will
unfold will impact where the majority of the Port’s focus will need to be spent to secure funding for
Port priorities. While advocacy to our congressional delegation will continue to remain vitally
important, we will need to step up efforts to advocate directly with agencies, which may have a
greater discretionary authority to spend federal dollars on local projects. In addition, a
combination of the above approaches will most likely prove successful. As stated earlier, this
approach is currently being utilized, for example, in a draft congressional delegation letter to the
U.S. Army Corps to ensure that the Oakland Harbor dredging is being prioritized in an era of
limited funding.
Additionally, the Obama Administration has proposed a “Fix It First” approach for many forms of
federal funding, encouraging the maximization of existing infrastructure instead of focusing on
new expansion. This approach, if adopted consistently across the federal spectrum, could allow
existing dredging efforts, for example, to take precedence over new dredging efforts currently
being contemplated across the country. The “zero-sum game” nature of the federal budget will
continue to determine our strategic opportunities.
Finally, a renewed focus will have to be placed on the competitive grants process and on creating
state and federal funding programs and opportunities for which the Port could be well-positioned
to compete. This includes an aggressive scan of relatively smaller grant programs across the
state and federal agency spectrums, so that multiple funds can be cobbled together to achieve a
larger unified purpose (such as will likely be the case for the former Oakland Army Base), as well
as advocacy for larger national programs such a National Infrastructure Investments (or Freight
Fund), that could expand greater access for potential Port of Oakland priority funding.
In addition to these over-arching strategies, we have compiled the following bullet point list of
priorities for each level of government:

Local & Regional Government:
      Forge a productive partnership with the Office of the Mayor, City Council, and City
       Administration focused on growing Port business and securing grant funding and policy
       that supports mutually beneficial projects
      Develop a supportive and collaborative relationship with the Alameda County Board of
       Supervisors, County Administrator, and County-wide agencies
      Enhance collaboration with the Alameda County Transportation Commission (ACTC) and
       Metropolitan Transportation Commission (MTC), as well as other advocacy groups and
       agencies that affect regional public policy and funding decisions

State Government:
      Secure modifications to the implementation of the Proposition 1B Air Quality Program that
       do not compromise environmental goals but expedite and ensure greater flexibility in
       accessing the funds




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      Protect Proposition 1B Trade Corridor Improvement Fund (TCIF) grants secured for the 7th
       Street Grade Separation and Outer Harbor Intermodal Terminal projects linked to the
       redevelopment of the former Oakland Army Base (OAB)
      Support state legislation and regulations that enhance Port business and oppose those
       that would not, leveraging partnerships such as that with the California Association of Port
       Authorities (CAPA) and California Airports Council (CAC)

Federal Government:
      Advocate with the Army Corps of Engineers and additional dredging-related agencies for
       additional funding and lower cost via streamlined regulatory processes for operations and
       maintenance dredging
      Secure the $2.1 million reimbursement from the Corps for the -42 foot project
      Promote a national goods movement policy that prioritizes funding for strategic national
       ports and trade gateways of national importance, specifically via the Surface
       Transportation Authorization or related federal legislation
      Secure funding via the Diesel Emissions Reduction Act (DERA) program or another
       Environmental Protection Agency (EPA) or DOE grant program for shorepower
      Work with industry associations to increase the Passenger Facility Charge
      Attain approval for non-stop service into Washington Reagan National Airport
      Obtain funding to fix the airport perimeter levee
      Promote activities that increase exports specifically linking the Port with agricultural and
       manufactured goods throughout California and the rest of the nation

International & Transnational:
      Capitalize on the Asia Pacific Economic Cooperation (APEC) Pre-Summit in September
       2011 in San Francisco and Summit in 2012 in Honolulu to support region-wide
       cooperation on export and environmental initiatives.
      Leverage participation in international associations such as the International Association
       of Ports & Harbors, which can serve as a beneficial platform for supporting Port policy
       objectives.
To accomplish this comprehensive a plan will require additional resources within the External
Affairs Division and Government Affairs Department coupled with a strategic redeployment of
existing Port resources.

Recommendations:
Conduct a New Competitive Selection Process for Federal Lobbying Services
Over the past two years, the federal lobbying team of Akerman Senterfitt has represented the
Port in Washington. They were instrumental in obtaining funding for the dredging project,
providing the Port with strategic advice regarding funding sources for Port priority projects (such
as shore power), helping to prepare the Port for the reauthorization of the Transportation bill and
effectively staffing the U.S. West Coast Collaboration. Last year, a key member of the team, Kyle
Mulhall, left Akerman to work for the Gephardt group. Fortunately, Rick Spees of Akerman,
continued the relationship with Mr. Mulhall by subcontracting with the Gephardt group. While the
team of Akerman Senterfitt and the Gephardt group has provided tremendous service prior to the
change of Congress, staff recommends that the Federal contract be put out to bid to revisit all of
the potential options for lobbying services. This process is already underway. At some point we

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will also need to consider a similar process for state lobbying services, but we do not propose that
step at this time.

Invest Resources in Regional Transportation Collaboration
In previous years, the Port of Oakland has had several individuals who were dedicated to
following regional transportation planning, including attending meetings of Alameda County
Transportation Commission, Metropolitan Transportation Commission, and the Association of Bay
Area Governments. By participating in these meetings and working with the staffs of these
organizations, the Port of Oakland ensured that its projects were incorporated into the regional
transportation plans. If projects are not in the plans, it is difficult to obtain federal and state
funding since the funds generally flow through these regional bodies or a determining factor for
direct earmarks is whether the projects have been vetted by the regional agencies. As staff has
been reduced through the years, the positions have been eliminated that held this function.

Reexamine/Expand Strategic Advocacy Partnerships
The Port invests significant financial resources in the 19 strategic advocacy partnerships listed in
Attachment 4. The return on this investment varies by organization, and it is important to note that
the cost of each organization is not for solely advocacy, but also for joint marketing and other
membership benefits (e.g. with the Oakland Metropolitan Chamber of Commerce and the U.S.
West Coast Collaboration).
Nonetheless, whether by redeploying or expanding the funding for such partnerships, the Port
may want to revisit a previously used strategy. For many years, the Port of Oakland had created
a Port Business Advisory Forum and a Customer Council. These groups were comprised of
major leaders of the business community within the Local Impact Area and our customers. They
were very helpful with our advocacy efforts by contacting legislators and speaking publicly in
support of the Port’s projects. Furthermore, this collaboration was unified by a “rallying” project,
previously dredging. It could be that because of the dominant role the OAB-development will play
in the future of the Port, and the fact that the success of this project depends on both land-side
and water-side infrastructure needs, that this project becomes the unifying basis for a new
advocacy partnership.
Another strategy would involve enhancing our participation within existing organizations. One that
shows strong promise in this regard is the Coalition for America’s Gateways and Trade Corridors
(CAGTC). We have requested support to fill an open board position at CAGTC to try and
leverage more support from the wide and effective coalition they have created. This will assist
with increasing our return on a limited investment in this association by gaining a seat on the
management committee and helping to set their priorities. This involves no additional financial
commitment, but will require an investment of time by the designated staff representative.

Recent/Upcoming Milestones:

1)     US West Coast Collaboration (USWCC)
On Monday, March 7, the Executive Directors of the 6 members of the USWCC met at the TPM
Conference to discuss an upcoming joint advocacy trip to Washington DC. This trip, scheduled to
take place in May or June, will include meeting with the new leadership in the House as well as
visiting Administration officials and Members of the Senate. At the TPM event, the USWCC
hosted a lunch as well.
Port staff will work with USWCC colleagues to submit a joint letter of support for the FREIGHT
Act (Focusing Resources, Economic Investment and Guidance to Help Transportation), which
highlights the need for investments in intermodal and freight-related infrastructure projects.


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2)     AAPA/CMANC Trip
This year, the annual AAPA Washington Legislative Conference as well as the California Marine
Affairs Navigation Conference (CMANC) conference is during the week of March 21st. Generally,
we would have combined this trip with the annual Commissioner lobbying trip. However, since
Congress is out of session, we have moved the Port-specific trip to April. Port staff will plan to
cover the AAPA and CMANC conferences and will meet with key staffers on the Hill and with the
Administration during this time.

3)     Port Board/Ag DC Trip
During the first week of April, the Port will be making its annual trip to Washington DC to advocate
on behalf of the Port’s federal priorities. This trip will be coordinated with the Nisei Farmers’
League to maximize the opportunities to meet with key Members of Congress.

4)     Ag Stakeholder Visits
We are planning several visits in the spring for agricultural leaders including the Presidents’
Agribusiness Council, the California Farm Bureau as well as others.

Conclusion:
This report is the first report to the Board on strategic government advocacy since early 2011.
Staff has committed to reporting to the Board on at least a quarterly basis, and will follow through
on this commitment going forward.
While there have been significant reductions in both the budget for contract and staff within the
Government Affairs Division over the last several years, the GA team, in partnership with team
members from throughout the Port, has done very strong work to ensure that the Port was
securing a fair share of public sector funding and policy support from every level of government.
The current action plan builds on this strong past work, and is the first step in recalibrating and
enhancing Port’s strategic government relations in line with the direction of the Board and the
new Strategic Plan. Staff thus looks forward to feedback and input from the Board and a dynamic
process of exchange and collaboration going forward to maximize the Port’s advocacy efforts.




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                                          Attachment 1

                    BACKGROUND ON PREVIOUS ADVOCACY EFFORTS

The Port Governmental Affairs (GA) team, including its state and federal lobbying consultants,
has worked aggressively over a number of years to secure and maintain funding for key port
initiatives, in addition to advancing seaport and airport interests through the development of
relationships with a wide array of external stakeholders. The GA team has worked to position the
Port to capitalize on strategic opportunities, be they funding, legislative, and/or regulatory, that
are available at the state and federal levels of government through formal and informal
partnerships with numerous trade associations and additional groups. For many years these
efforts were unified around securing funding to dredge the Port to 50 feet, a $425 hundred million
effort that was completed in 2009.

More recently, GA team efforts have allowed key Port initiatives to advance despite severe
funding constraints at the state and federal levels of government. Some recent examples include
the following:
      Successful competitive TIGER grant application to the U.S. Department of Transportation,
       which is delivering vital federal stimulus funding for the shore power program. The grant
       was the highest-funded Port project to receive funding through Round I of the TIGER
       program.
      Infusion of additional Recovery Act funding for airport priorities including the East Apron
       tarmac and construction of a new Air Traffic Control Tower.

Over the last year, however, many traditional funding and advocacy efforts and legislative
vehicles used to advance legislation were not available to any seaport or airport interests
nationwide, due to the lack of agreement of the 111th Congress in 2009 and 2010 on major
funding and appropriations bills. Congress was not able to complete work on even its most basic
obligation, a unified federal budget for the period covering October 1, 2010 through September
30, 2011.

Thus, while the Port was successful in working with the Congressional delegation to secure an
increase in the President’s FY2011 budget to facilitate the U.S. Army Corps’ $2.1 million
repayment to the Port to reconcile the previous -42 Foot dredging efforts, as well as an additional
increase in funds for annual maintenance dredging, the failure of Congress to pass an Omnibus
multi-agency funding bill for FY11 meant that these specific earmark project requests from our
delegation were not signed into law.

In addition, multi-year authorization and funding bills such as the Surface Transportation
Reauthorization (the “Highway Bill”), the Federal Aviation Administration (FAA) Reauthorization,
the Water Resources Development Act (WRDA) – all conduits for advancing Port priorities
through the federal government – were not able to gain sufficient support to move successfully
through the legislative process. The prospects for passage of these legislative items have
increased in some cases in 2011, albeit with considerable reductions of size, scope, and the
permissibility of congressionally-directed funding for local initiatives.




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                                           Attachment 2

                                      CURRENT CONTEXT

Government at every level is facing a crisis. From local agencies like the Port of Oakland to our
federal government, there is a growing imbalance between the funding and investment needed
and expected, and the revenue necessary to meet these needs and expectations. This crisis has
been predicted and expected for several years now, but events at every level of government
suggest that the watershed point has arrived and that a paradigm shift is required. The following
sections detail the challenges at state and federal levels of government in particular.

Federal Level

The composition of the newly-elected 112th Congress, the upcoming state and federal redrawing
of the districts of our elected representatives, the extraordinary state and federal budget deficits,
and the new federal prohibition on earmarks will present some new, albeit familiar, challenges to
ensuring that the state and federal governments are able to partner with the Port on its key
priorities. With a Republican majority in the House of Representatives and a narrowed
Democratic majority in the Senate, prospects for bipartisan cooperation continue to appear dim.

Budget Process Challenges

Under a “normal” budget process for the FY12 fiscal year (covering the period from October 1,
2011 through September 30, 2012) the President’s February budget submission to Congress
would be followed by Senate and House consideration of separate Congressional Budget
Authorization bills (which determine overall funding authority for each of the 12 appropriations
committees, and do not need to be signed by the President). The two chambers would then
engage in the development of individual spending bills for the federal agencies throughout the
summer and fall of 2011, with the goal of having the President sign these appropriations bills into
law by September 30, 2011.

This year, however, work has still not been completed on the legislation that funds the overall
operation of government through September 30, 2011. As of March 17th, Congress had yet to
come to an agreement on how to complete the budget for the rest of FY2011. Because Congress
could not come to agreement on its 2011 Appropriations bills, the government has been operating
on a series of continuing resolutions that generally set spending at the 2010 levels. On February
24th, the House passed H.R. 1, which lowered government spending below the fiscal year 2010
levels for the remainder of fiscal year 2011. These cuts totaled nearly $61 billion by reducing
funding levels for the federal highway program, eliminating programs such as the National
Infrastructure Investments/TIGER II and High Speed Rail, and rescinding unobligated Recovery
Act funds, among many other projects that were impacted.

In order to avoid a shutdown (because the Senate refused to act on the House bill) House
Republicans developed a two-week spending bill that cut $4 billion in government spending
immediately and provided additional time for the House and Senate to come to an agreement on
the larger budget issues, and then an additional three-week spending bill that cut $6 billion in
additional spending. The new continuing resolution (CR) would allow all government agencies
and programs to continue operating until April 8th at the reduced levels. Pending Senate approval
of this latest three-week CR, Congress now has until April 8th to come to a full agreement on
funding for FY11, pass another short-term CR to fund government operations, or confront a
potential shutdown.



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Elimination of Earmarks

Of special note regarding the FY12 federal funding process is the new prohibition on earmarking
for congressionally-directed spending. Both the House and the Senate have discontinued, for
now, the practice of earmarking funding bills with specific project requests. The President has
also said that he will veto any funding bill that contains earmarks. The Port has relied on
Presidential line items (technically considered earmarks) for its dredging project, both for new
construction and for ongoing maintenance dredging. It is unclear if the Congress will continue to
defer to the Administration on setting spending priorities, or if an alternative to the traditional
earmarking process will be established. Additionally, the highway bill and the water resources
legislation have traditionally been dominated by specific line item spending authority, which could
be rendered moot by an earmark prohibition.

State Level

At the state level, the Governor and the legislative leaders are engaged in high-level discussions
regarding a combination of funding cuts and an extension of taxation authority (upon approval by
the voters for a planned June statewide election) that will help close a $26.6 billion deficit for this
year. Failure to achieve a consensus on placing the taxation items on the June ballot, or the
failure of the voters to extend the tax measures, could have drastic consequences for the state’s
ability to meet its current spending obligations.

This two-year session is even more complex due to redistricting by the non-partisan citizen’s
commission and the likelihood of General Election match ups between candidates of the same
party. 2011-12 is a time of uncertainty, where even veteran office holders are looking to expand
their issue and geographical boundaries and institutions such as the Port can find willing
audiences to listen to our narrative of jobs, exports, environmental stewardship and economic
recovery.




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                                             Attachment 3

                Examples of Current State & Federal Legislation of Interest/Concern

Federal

S. 412 - Harbor Maintenance Trust Fund Act (Sen. Levin): The bill would ensure that amounts
credited to the Harbor Maintenance Trust Fund are spent annually for harbor maintenance.

S. 371 - FREIGHT Act of 2011 (Sen. Lautenberg): The bill defines the federal government’s role in
freight transportation policy and planning, instructing US DOT to develop a strategic plan for investing
in the country’s goods movement infrastructure. In addition, it calls for the creation of a new National
Freight Infrastructure Investments Grant program to fund projects prioritized through merit-based
criteria that substantiate national significance. Please note that many elements of this bill have been
promoted over the past 2 years by the US West Coast Container Port Collaborative.

H.R. 572 - Clean Ports Act of 2011 (Rep. Nadler): The bill would declares that federal preemption of
state and local law relating to a price, route, or service of any motor carrier of property shall not apply
to the authority of a state, local government, or the political authority of two or more states to adopt
requirements for motor carriers providing services at port facilities that are reasonably related to the
reduction of environmental pollution, traffic congestion, the improvement of highway safety, or the
efficient utilization of such port facilities, provided adoption or enforcement of such requirements.

H.R. 526 - ON TIME Act (Rep. Calvert): The bill creates a national program and calls for the creation
of a new federal freight fee to fund transportation projects in along specific transportation trade
corridors.

H.R. 104 - Realize America’s Maritime Promise Act (RAMP) of 2011 (Rep. Boustany): The bill would
require that amounts credited to the Harbor Maintenance Trust Fund be used for harbor maintenance.

State

AB 57 (Beall): Would expand the membership of the Metropolitan Transportation Commission by two
members, with one of those being from the City of Oakland. This would serve to give Oakland a
greater voice in the transportation planning and funding decisions that affect our region.

AB 950 (Speaker Perez, co-sponsored by Assm. Swanson): Would deem port drayage truck
operators as employees of those companies or persons who engage their services. This is a
measure sponsored by the International Brotherhood of Teamsters.

AB 1064 (Furutani): Introduced on behalf of CAPA to clarify that the CARB guidelines allocating
Proposition 1B Air Quality funds (including funds going to the Port of Oakland) will allow ports to
“bank” all of their ship calls to electrified berths that are in excess of the regulatory required visits.
The bill also allows the averaging of ship calls within terminals to show compliance with the plug-in
requirements.

SB 460 (Price): Would authorize the CA Business, Transportation and Housing Agency to coordinate,
encourage, and provide support for international trade marketing and promotion activities, in addition
to convene a statewide business partnership for international trade marketing and promotion.




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                                                             Attachment 4

                                                  Strategic Advocacy Partnerships

#                         Partner Organization                                                  Joint Advocacy Priorities
 1 Airports Council International – North America (ACI-NA)                   PFC increase; addition of landing slots into DCA; legislative
                                                                             advocacy and education

 2 American Association of Port Authorities (AAPA)                           Port funding for dredging; security funding; environmental
                                                                             initiatives; legislative advocacy and education
 3 Bay Area Council (BAC)                                                    Rail expansion; capacity enhancements; dredging;
                                                                             international trade opportunities

 4 Bay Planning Coalition (BPC)                                              Regional economic development; dredging (particularly with
                                                                             regard to technical issues)

 5 California Airports Council (CAC)                                         Customer Facility Charges for rental car operations; statewide
                                                                             education and advocacy; support for federal initiatives on PFCs

 6 California Association of Port Authorities (CAPA)                         Shore power funding and regulatory flexibility; legislative
                                                                             advocacy and education

 7 Coalition for America’s Gateways and Trade Corridors (CAGTC)              Dedicated freight funding for ports; prioritization of
                                                                             infrastructure funding in federal initiatives

 8 Nisei Farmers League                                                      Port funding for dredging; funding for diesel emissions
                                                                             reduction initiatives; freight and infrastructure funding

 9 U.S. West Coast Collaboration (USWCC)                                     Promotion of West Coast container ports; federal freight
                                                                             funding; expansion of international trade opportunities

10 Oakland Metropolitan Chamber of Commerce (OMCC)                           Regional economic competitiveness; expanding international
                                                                             trade opportunities for Oakland

11 East Bay Economic Development Association (East Bay EDA)                  Regional economic competitiveness; infrastructure funding




                                                             Page 16 of 17



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#                         Partner Organization                                             Joint Advocacy Priorities
12 Airport Area Business Association (AABA)                             Airport business promotion; regional economic competitiveness


13 Contra Costa Council                                                 Transportation funding for rail and infrastructure priorities


14 Oakland African American Chamber of Commerce (OAACC)                 Regional economic development; local business utilization


15 Presidents Agribusiness Council                                      Increasing agricultural exports; maintaining competitiveness of
                                                                        agricultural sector

16 California Farm Bureau (CFB)                                         Increasing agricultural exports; state policies that affect
                                                                        agricultural sector

17 Agriculture Transportation Coalition (AgTC)                          Focus on ocean shipping links to agricultural exports


18 Oakland Chinatown Chamber of Commerce (OCCC)                         Expanding international trade opportunities; local business
                                                                        utilization

19 Hispanic Chamber of Commerce of Alameda County (HCCAC)               Expanding international trade opportunities; local business
                                                                        utilization

20 California Marine Affairs Navigation Conference (CMANC)              Increasing funds for maintenance dredging; expanding use of
                                                                        Harbor Maintenance Tax collections at federal level




                                                        Page 17 of 17



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  PORT GOVERNMENTAL                                                      FUNDING OPPORTUNITIES
AFFAIRS FUNDING SUMMARY    Total                                                                                             State/Local      Proposed                            Status/Notes                         Critical
                        Cost/Funding                     ARRA       SAFETEA-       WRDA          PSGP       POTUS Budget      Funding        Port/Private                                                         Milestones/Dates
       MARCH 2011
                                          Need                         LU                                      FY12                          Contribution
NEAR TERM
Maritime Shore Power                                                                                                                                         FED: ARRA TIGER grant STATE: up to $23.9M                 Ongoing
                                       $90,000,000    $7,850,000                                                           To be determined To be determined CARB Prop 1B Grant Award LOCAL: up to $5M from
                                                                                                                                                             BAAQMD
42' Dredging Reimbursement              $2,086,732                                                                                                           FED: Seeking reprogramming of existing funds               Ongoing

OAK Airport Levee Improvements                                                                                                                                 FED: Water Resources Development Act                    Ongoing
                                       $60,000,000                               $45,000,000                                                To be determined
                                                                                                                                                               Reauthorization request to Boxer
50' Dredging Project Construction                                                                                                                              FED: POTUS Budget request for FY12                       Ongoing
General                                 $350,000                                                              $350,000
50' Dredging Operations &                                                                                                                                      FED: Seeking reprogramming of US Army Corps              Ongoing
Maintenance                            $20,000,000                                                           $8,700,000                                        funding
MEDIUM/LONG TERM
Outer Harbor Intermodal Terminal                                                                                                                               FED: SAFETEA-LU funding is will be pursued         Initiate Construction
                                                                      To be
(OHIT)                                 $274,000,000                                                                         $132,000,000     $142,000,000      STATE: Prop 1B TCIF; PRIVATE: OAB Developer              by 12/2013
                                                                    determined
                                                                                                                                                               contribution.
7th Street Grade Separation                                                                                                                                    FED: SAFETEA-LU funding is will be pursued         Initiate Construction
                                                                      To be
                                       $220,000,000                                                                         $110,000,000     $110,000,000      STATE: Prop 1B TCIF; PRIVATE: OAB Developer              by 12/2013
                                                                    determined
                                                                                                                                                               contribution.
Tehachapi Trade Corridor                                                                                                                                       BNSF: privately funded STATE: Prop 1B TCIF. No     Initiate Construction
                                       $82,000,000                                                                          $41,000,000       $41,000,000                                                               by 12/2013
                                                                                                                                                               Port funds
Fiber Optic Connection to OPD                                                                                                                                  FED: PSGP round 7 Supplemental STATE: Prop 1B          Spring 2011
                                        $1,000,000                                              $600,000                      $200,000         $200,000
                                                                                                                                                               PORT: in-kind staff costs
Geo Spatial Security Mapping Project                                                                                                                           FED: PSPG round 7 Supplemental STATE: Prop. 1B         Spring 2011
                                        $1,700,000                                             $1,000,000                     $335,000         $335,000
                                                                                                                                                               PORT: in-kind staff costs
Richmond At-Grade Rail Connector                                                                                                                               BNSF Richmond at-grade rail connection. STATE:     Initiate Construction
                                       $24,300,000                                                                          $12,150,000       $12,150,000      Prop 1B TCIF and MTC contribution. No Port funds         by 12/2013
FUNDED AND/OR ONGOING
A/P East Apron Phase 3                 $31,000,000    $14,900,000                                                                             $16,100,000      PORT: CIP/PFC/AIP funding                                Funded
Central Corridor: Donner Summit                                                                                                                                Union Pacific: privately funded and Phase I              Funded
                                       ~$90,000,000                                                                                          ~$90,000,000
                                                                                                                                                               completed. No Port funds.
FAA Air Traffic Control Tower                                                                                                                                  FED: Federal Aviation Administration                     Funded
                                       $30,000,000    $30,000,000
replacement
Truck Retrofit                                                                                                                                                 FED/STATE/LOCAL: $21M from CARB, $5M from                Funded
                                       $31,000,000    $2,000,000                                                            $26,000,000       $5,000,000
                                                                                                                                                               BAAQMD, $2M from USEPA through ARRA
Joint Port City Domain Awareness                                                                                                                               FED: Grant request approved September 2009               Funded
                                        $2,900,000    $2,900,000
Center
TWIC Marine Terminal Access Control                                                                                                                            FED: Grant request approved September 2009               Funded
                                        $5,350,000    $4,700,000                                                                               $646,000
System
Perimeter Intrusion Detection System                                                                                                                           FED: Port Security Grant Program round 7                 Funded
and Fiber Optic Communications          $7,511,500                                             $5,623,700                    $1,887,800
RFID Truck Tracking System              $4,300,000                                                                           $3,800,000        $500,000        STATE: Prop 1B                                           Funded
Crane Mounted Cameras                   $3,227,000                                             $2,300,000                                      $790,000        FED: PSPG round 5                                        Funded
Port Wide Security System Resiliency                                                                                                                           FED: PSPG round 9                                        Funded
                                        $1,860,000                                             $1,400,000                                      $460,000
Improvements - IT Network
Surveillance System Linkage to Fiber                                                                                                                           FED: PSPG round 10                                       Funded
                                        $222,000                                                $222,000
Optic Network
Surveillance and Monitoring System                                                                                                                             FED: PSPG round 10                                       Funded
Maintenance for 3 years                 $2,330,000                                             $2,330,000




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LEGEND

AIP                 Airport Improvement Program
ARRA                American Recovery & Reinvestment Act ("Stimulus Act")
CARB Prop 1B        California Air Resources Board Proposition 1B Emissions Reduction Program ("I-Bond")
CIP                 Capital Improvement Program (CIP)
CIRIS               California Inter-Regional Intermodal System (short-haul rail)
FAA                 Federal Aviation Administration
OHIT                Outer Harbor Intermodal Terminal
OPD                 Oakland Police Department
PFC                 Passenger Facility Charge
POTUS Budget FY12   Fiscal Year 2012 President's Budget Request
PSPG                Port Security Grant Program
RFID                Radio Frequency Identification System
SAFETEA-LU          Multi-year federal Transportation Authorization legislation ("Highway Bill")
TCIF                California Transportation Commission Proposition 1B Trade Corridor Improvement Fund ("I-Bond")
TWIC                Transportation Worker Identification Credential
WRDA                Water Resources Development Act




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                                “PortComm”
                 Moving Toward a Comprehensive and
                 Modern Port Communications System


    External Affairs Division
    March 18, 2011




1


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Where we are
       Stakeholder lists are dispersed and formats vary
        by department, making it hard to keep lists
        updated or send messages effectively
       Limited utilization of social media
       Underdeveloped internal communication tools
        (Port Courier, Intranet, Hot Topics, etc.)
       Deeper/Longer Term Issues: No unified
        (internal/external) communications plan; outdated
        website, logo, corporate branding, etc.

2


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Where we want to be
   Central to the Strategic Plan:
     GuidingPrinciple: The Port proactively
      communicates with its multiple stakeholders.
     Prioritized   Goals:
        Promote a proactive and responsive
         communications model.
        Provide timely and relevant information to support
         critical analysis and decision-making.



3


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Short-term v. Long-term
   Short-term:
     E-mail broadcast system
     Social media
     Lobby screens
     Communications plan (initial phase)
     Website information updates
   Longer term (FY12 depending on budget):
     Website (thorough overhaul and unification of Port
      websites)
     Logo
     Thorough branding/rebranding and comprehensive
      communications plan

4


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Our team/collaborative approach
 Guided by Board leadership and policy
 Informed by Executive Director, Board
  Secretary, and Senior Management
 Directed by External Affairs
 Delivered by “Joint Marketing Council”
     PR/Media
     ITDivision
     Revenue Divisions Marketing representatives



5


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    E-mail Broadcast System




6


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Existing Stakeholder Lists (partial)
    Person                     # of Contacts    Function                                 Current System
    Robert Bernardo                        25   Media/Public Relations                   Spreadsheet
    Ron Brown                             800   Maritime                                 Salesforce.com
    Lila Zinn                              80   SRD Community Based Organizations        Spreadsheet

    Joyce Washington                      100   CRE Tenants                              Spreadsheet
    Laura Arreola                        1000   Community Outreach                       Spreadsheet
    PJ Bell                              1000   Certification                            Spreadsheet
    Connie Ng                            1000   Outreach                                 Spreadsheet
    George Lythcott                      3500   Vendors                                  Oracle
    Cynthia Renta                         300   WAMS / FMP                               Elations
    Brandon Mark                          200   AP Property both north & south           GW addressbook
    Daria Edgerly                         150   Board Docs Distribution List             Spreadsheet
    Linda Crockett                        500   Aviation Operations                      Memberclicks
    Kyle Mobley                            25   Aviation IT Vendors                      Spreadsheet
    Matt Davis                            125   Governmental Affairs                     FMP
    Other                                 450   Port Employees, Others                   Outlook/HRIS/+


                      Total:         9,255

7


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Solution Selection Criteria
     Effectiveat email campaigns
     Email blasts need to be visually
      appealing
     Easy to use and maintain
      Allowseveral people to maintain lists
       and send emails
      Can be used by all divisions
     Reasonable   in cost
8


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Steps Performed So Far…
       Committee formed to evaluate solutions
         Maritime,Aviation, CRE, IT, Media Relations & SRD
          representatives
       36 systems evaluated, 3 finalists
       System demonstrations held for finalists
       Further due diligence revealed shortcomings
       Currently re-evaluating potential vendors, with
        goal of rapid roll-out (in time for April 12 EOC
        exercise)
9


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Next Steps
 Finalize selection process
 Develop guidelines for using system
 Identify existing lists and import email lists
  into system
 Training for authorized users
 Roll-out “PortComm” jointly with social
  media launch


10


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     Social Media




11


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Current Situation
    OAK is a leader – 7,271 fans on Facebook!
    Competitor ports have strong and effective
     presence on Facebook (e.g. POLA had posted
     twice about tsunami response by 8 AM Friday)
    Port of Oakland has no Facebook but 429
     followers on Twitter
    No guidelines, unified strategy, or significant
     awareness


12


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Next Steps
 Finalize Facebook page
 Finalize social media utilization guidelines
 Launch with a press release, internal
  message (via our new e-mail broadcast
  system), etc.
 Begin utilization and propagation through
  Port employees and stakeholders


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     Lobby Screens




14


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Current Situation
 Lobby screens were dark for many months
  until CMHI visit
 Two screens in lobby with static message;
  one on IT floor with multiple messages
 No coordinated and comprehensive
  messaging for internal or external
  stakeholders


15


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Next Steps
    Develop content for two lobby screens:
      Welcome   (multilingual)
      Provide overview – working with revenue
       divisions
      Announcements – jobs and community
      General info – time, weather, stocks, news,
       etc.
    Put third screen on 3rd floor entry way for
     greater visibility and support for Port
     messaging
16


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Conclusion
    PortComm: The new Port communications system
    E-mail broadcast, social media, and lobby screens are
     only first steps – “low-hanging fruit”
    Next steps
      Targeted updates to most out-dated web content
      Branding of e-mail signatures (e.g. add social media linkages)
      Media training for Board (Strat Plan Implementing Action)
      Draft internal and external communications plan
    FY11 steps are done with existing resources and
     redeployment
    FY12 actions will require additional resources and/or
     redeployment

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     Questions?




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                                          CONSENT ITEMS Tab 5



                     CONSENT ITEMS
Action by the Board under “Consent Items” means that all
matters listed below have been summarized, and are
considered to be perfunctory in nature, and will be adopted
by one motion and appropriate vote. Consent Items may be
removed for further discussion by the Board at the request of
any member of the Board.




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                                                                              CONSENT ITEMS Tab 5.1



                                                                                        JAMES W. HEAD
OMAR BENJAMIN                PORT OF OAKLAND                                                  President
Executive Director            BOARD OF PORT COMMISSIONERS                           PAMELA CALLOWAY
                               530 Water Street i Oakland, California 94607           First Vice-President
DAVID L. ALEXANDER                                                                    GILDA GONZALES
Port Attorney                           Telephone: (510) 627-1100                   Second Vice-President
                                        Facsimile: (510) 451-5914                   MARGARET GORDON
                                            TDD/TTY – Dial 711                           Commissioner
ARNEL ATIENZA
Port Auditor                                                                         KENNETH KATZOFF
                                   E-Mail:board@portoakland.com                           Commissioner
                             Website:   www.portofoakland.com                         MICHAEL LIGHTY
JOHN T. BETTERTON
                                                                                         Commissioner
Secretary of the Board
                                                                                           VICTOR UNO
                                                                                           Commissioner
                                             MINUTES
                         Meeting of the Board of Port Commissioners
                             Tuesday March 15, 2011 – 1:30 p.m.
                                        Board Room – 2nd Floor
ROLL CALL

           President Head called the Regular Meeting of the Board to order at 1:40 p.m., and the
           following Commissioners were in attendance:

           1st Vice President Calloway, 2nd Vice-President Gonzales, Commissioner Gordon,
           Commissioner Katzoff, Commissioner Lighty, Commissioner Uno and President Head.

1. CLOSED SESSION

           President Head convened the Board in Closed Session at 1:41 p.m. to hear the
           following:

           CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION. Pursuant to
           subdivision (a) of Section 54956.9.

           Sherri “Jean” Parks v. Port of Oakland; Alameda County Superior
           Court No.: RG 07361568

           SSA Terminals, LLC and SSA Terminals (Oakland), LLC v. the City of Oakland, Acting by
           and Through its Board of Port Commissioners Docket No. 09-08

1.1        CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION. Significant
           exposure to litigation pursuant to subdivision (b) of Section 54956.9:
           8 matter(s)




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                                                                   CONSENT ITEMS Tab 5.1




1.2   CONFERENCE WITH REAL PROPERTY NEGOTIATOR - As provided under California
      Government Code Section 54956.8:

      Property:                  Former Oakland Army Base and Adjacent Properties
      Negotiating Parties:       Port of Oakland, AMB Properties and California Capital Group
      Agency Negotiator:         Director of Maritime, James Kwon
      Under Negotiation:         Price and Terms of Payment

      Property:                  Various parcels in Jack London Square
      Negotiating Parties:       Port of Oakland Jack London Square Ventures, LLC
      Agency Negotiator:         Director of Commercial Real Estate
      Under Negotiation:         Price and Terms of Payment

1.4   CONFERENCE WITH LABOR NEGOTIATORS - Pursuant to Subdivision (f) of Section
      54957.6.

      Agency Designated Representative:           Marsha Peterson
      Employee Organizations:                     International Brotherhood of Electrical Workers
                                                  (IBEW Local 1245), International Federation of
                                                  Professional and Technical Engineers (IFPTE
                                                  Local 21), Service Employees International
                                                  Union (SEIU Local 1021), and Western Council
                                                  of Engineers (WCE)

1.5   PUBLIC EMPLOYEE PERFORMANCE EVALUATION

      Title: Executive Director, Port Attorney, Port Auditor, Board Secretary

ROLL CALL/OPEN SESSION

      President Head reconvened the Board in Open Session at 5:22 p.m., and the following
      Commissioners were in attendance:

      1st Vice President Calloway, 2nd Vice-President Gonzales, Commissioner Gordon,
      Commissioner Katzoff, Commissioner Lighty, Commissioner Uno and President Head

      President Head asked to observe a moment of silence in the memory of victims of the
      earthquake and tsunami in Japan and in observance of the ongoing crisis and hardship of
      the Japanese people.

CLOSED SESSION REPORT

      The Board Secretary reported that the Board had unanimously approved (7 Ayes) in
      Closed Session the following Resolutions:

      Resolution Approving and Authorizing Execution Of A Settlement Agreement Between
      The Port Of Oakland ("Port") And The Western Council Of Engineers.


                                              2



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                                                                CONSENT ITEMS Tab 5.1



      Resolution Authorizing and Approving Retention Of Special Counsel.

      Resolution Approving the Acceptance Of Environmental Insurance Recoveries From
      Chubb Insurance Company Concerning Environmental Contamination In Certain Portions
      Of The Jack London Square Area Of The Port.

      Resolution Approving And Authorizing Execution Of A Settlement Agreement Among The
      Port Of Oakland ("Port"); Faith Fuller-Tompkins; And The International Federation Of
      Professional & Technical Engineers, Local 21.

2. MAJOR PROJECTS

      Acting Deputy Executive Director, Joyce Washington, briefed the Board on Item 2.1.

      At the Direction of the President Head the Item was removed from the Agenda and staff
      was directed to reschedule it for a subsequent meeting.

2.1   Authorization for the Executive Director to enter into a Supplemental Agreement for ERP
      Support and Related Activities

3. BUDGET & FINANCE

      The Chief Financial Officer, Sara Lee, reported on Item 3.1.

3.1   Unaudited Financial Results for 6 Months Ended December 31, 2010

4. STRATEGY & POLICY

      Item 4.1 was pulled on the recommendation of staff.

4.1   PULLED Adoption of a Land Use and Development Code for the Airport Business Park
      to Update and Replace Existing Standards and Restrictions (Engineering)

5. CONSENT ITEMS

      A Motion to approve the Consent Items was made by Vice-President Calloway and
      seconded by Vice-President Gonzales.

5.1   Approval of the Minutes of the Regular Meeting of February 15, 2011 (Board Secretary)

5.2   Quarterly Report of Construction Change Orders for 2nd Quarter FY 10/11
      (Engineering)

5.3   Building Permit: City of Oakland, Public Works Edgewater Drive and Hegenberger Road
      (Engineering)

      The Motion to approve the Consent Items passed by the following votes: (7) Ayes:
      1st Vice President Calloway, 2nd Vice-President Gonzales, Commissioner Gordon,
      Commissioner Katzoff, Commissioner Lighty, Commissioner Uno and President Head

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6. REMAINING ACTION ITEMS

      Acting Commercial Real Estate Director, Pamela Kershaw, reported on Item 6.1.

      A Motion to approve Item 6.1 was made by Vice-President Gonzales and seconded by
      Vice President Calloway.

6.1   Approval of a Building Engineering Services Contract for 530 Water Street and Certain
      Other Assets (CRE)

      The Motion to approve 6.1 passed by the following votes: (7) Ayes:
      1st Vice President Calloway, 2nd Vice-President Gonzales, Commissioner Gordon,
      Commissioner Katzoff, Commissioner Lighty, Commissioner Uno and President Head.

      Acting Commercial Real Estate Director, Pamela Kershaw, reported on Item 6.2.

      A Motion to approve Item 6.2, Option 3 (rejecting all bids), was made by Commissioner
      Uno and seconded by Commissioner Lighty.

      The following people addressed the Board on Item 6.2: Michael Lee, Jose Luis Pereda,
      Patsy Helton, Asffaw Ibsa, Dave Ellis, Ivory McDaniel and Steven Fagalde.

      The makers of the Motion accepted a friendly amendment from Vice-President Calloway
      directing staff to reevaluate questions regarding benefits, in light of representations made
      by Food Specialist’s, Inc., and a more definitive statement of policy regarding the rehire
      of individuals currently employed in the valet parking operations in Jack London Square.
      Commissioner Lighty asked that all representations be made in writing.

6.2   Approval of a Valet Parking Operations Agreement for Jack London Square (CRE)

      The Motion to approve 6.2 passed by the following votes: (5) Ayes: 1st Vice President
      Calloway, Commissioner Lighty, Commissioner Katzoff, Commissioner Uno and
      President Head; (2) Noes: 2nd Vice-President Gonzales, Commissioner Gordon.

      A Motion to approve Item 6.3 was made by Commissioner Uno and seconded by
      Commissioner Katzoff.

      Maritime Director James Kwon and Maritime Services Coordinator Ramona Dixon
      briefed the Board on Item 6.3.

6.3   Authorization for the Executive Director to Enter into an Easement Agreement with
      Alameda Gateway Limited (Maritime)

      By prior arrangement, Commissioner Katzoff, left the meeting at 6:10 pm.

      The Motion to approve 6.3 passed by the following votes: (5) Ayes: 1st Vice President
      Calloway, 2nd Vice-President Gonzales, Commissioner Gordon, Commissioner
      Lighty, Commissioner Uno and President Head; (1) Excused: Commissioner Katzoff

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7. UPDATES/ANNOUNCEMENTS

      Executive Director, Omar Benjamin, announced that he had accepted on behalf of
      Commissioner Gordon the Bay Area Business – Spotlight Award.

      President Head, reported that the Port of Oakland and China Merchants Holdings
      International jointly hosted a half-day symposium titled “Blueprint for China’s Shipping
      and Logistics Growth”.

      Commissioner Uno reported on the visit of the Shanghai Trade Union Delegation.

      Vice-President Calloway, reported that the Port had won the “Employer of the Year
      Award” from the Women in Transportation Seminar.

8. SCHEDULING

      President Head announced that the Board may need to call a Special Meeting in the
      second week of April to discuss the Budget.

OPEN FORUM

      The following individuals addressed the Board in Open Forum: Valerie Lapin, Paul
      Marvy, Porfirio Diaz, Will C., Abdul K., Manuel R., Xavier G., Everardo H., John Brauer,
      Christine Cordero, Kelsey Frazier, Michael Shaw, Scott Taylor, Andy Garcia, Mahabir
      Randawa, Jaswinder Singh, Ron Light, Susan Luong

ADJOURNMENT

      There being no additional business the Board adjourned at 7:21 p.m.



      ____________________________                                            ______________

      John Betterton, Secretary                                                     Date




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                              AGENDA REPORT
TITLE:            Approval of a Fourth Supplemental Agreement with ARINC, Inc. to
                  Provide 2nd Level Maintenance Support and Licensing for the iMUSE
                  Common Use System at the Oakland International Airport for Two
                  years for $205,992 with the option of a third year for $102,996.

AMOUNT:           $205,992 in FY’s 11/12 and 12/13 and an optional $102,996 in FY 13/14.

PARTIES INVOLVED:

                   Corporate Name/Principal              Location
                   ARINC, Inc / Norman Keilpart          7666 E. 61st #625
                                                         Tulsa, Oklahoma 74133

TYPE OF ACTION:                       Resolution

SUBMITTED BY:                         Deborah Ale Flint, Director of Aviation

APPROVED BY:                          Omar R. Benjamin, Executive Director

SUMMARY

Common use systems are used at OAK so that different airlines may operate at different
gates and ticket counters. Southwest Airlines, Terminal 2 ticket counters, and Gates 22-30
are the only facilities not on common use.

Similar to many IT software systems, initial investment in establishing the system is
significant and it is typically cost effective to upgrade and renew maintenance agreements
rather than make a new initial investment with a different software system.

The aviation industry is in the process of developing standards for common use software.
It would be most beneficial to wait until the standards are adopted and software providers
have developed competing products before considering a new RFP process for new
software fully compliant with the new standards. Until that time ongoing maintenance by
the proprietary company is the most cost effective method to continue OAK’s common use
system.

Aviation IT is recommending a fourth supplemental agreement to ARINC, Inc. Staff has
identified the following benefits to a supplemental agreement:

          1. Maximizing use of the current system.
          2. Allow time for the new industry Common Use Standard to be adopted.
          3. Allow time for a RFP process to locate a new generation Common Use
             Passenger Processing System (CUPPS).



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FACTUAL BACKGROUND

In June 2004, the Port issued a purchase order to ARINC, Inc. to provide software,
hardware, training and five years of maintenance for the Multi User System Environment
(MUSE) at Oakland International Airport (OAK). Including Port administrative workstations,
there are 140 MUSE-licensed computer systems and two MUSE servers at OAK.

In August 2006, the Board authorized an agreement with ARINC to upgrade the MUSE
system. The Board authorized supplemental agreements in March 2008 to purchase
additional MUSE hardware.

In May 2009, the Board authorized a third supplemental agreement to extend the current
support contract by up to two years.


ANALYSIS

As common use systems at airports started to gain popularity in the early 2000’s, many
issues started to surface in the way they were being developed and implemented.
Vendors, all with their own ideas on the best way to deliver airline reservation, ticketing,
and boarding applications, required airlines to customize their applications for any of seven
(7) possible software platforms airport’s had to choose from. In addition, each airport
implemented different hardware, meaning that airlines would need to customize their
applications for almost every airport they wanted to operate in. While common use is an
excellent solution for maximizing the use of an airports gates and ticket counters, it created
additional work for the airlines.

In 2002, the International Air Transportation Association (IATA) in collaboration with air
carriers, airports and vendors began working on a new common use standard called
Common Use Passenger Processing System (CUPPS). What will make CUPPS unique is
that it will enable an airline to process passengers using the same application on any
CUPPS provider’s platform, eliminating the need to maintain multiple terminal applications
and therefore reduce costs.

With the industry anticipating that the new standard would soon be published, in May 2009,
Aviation IT staff recommended a supplemental agreement with the current common use
software provider for two years. The new CUPPS standard was published by IATA in
November 2009; however, vendors and airlines have been slow to adopt it.

Thus it is anticipated that additional delays will be incurred before there is a robust
competitive market for issuing a new RFP for a new CUPPS system at OAK. In FY 2012-
2013, the current common use computer servers will be at the end of their functional life
and will need to be replaced. In addition to new servers, some of the other current
hardware may need to be replaced to make the system compliant. Staff is working on a gap
analysis to determine what hardware would need to be replaced for a CUPPS-compliant
system. The intention is to have a new CUPPS-compliant solution selected, approved and
implemented in FY 2013 using an open competitive selection process.
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STRATEGIC PLAN ALIGNMENT

Staff has determined that this supplemental agreement will fulfill the following strategic plan
objective:
Strategic Priority     Goal                            Objective               How Common Use
Areas                                                                          Implements
                       Goal A: Create                  1. Maximize the use     The current common
                       sustainable economic               of existing assets   use solution was
                       growth for the Port and                                 implemented in
                       Beyond                                                  August 2006 and
                                                                               has a remaining
                                                                               functional life of 2
                                                                               years. By waiting an
                                                                               additional two years,
                                                                               the Port can get the
                                                                               most from their
                                                                               investment.

Sustainable
                                                                               Common use allows
Economic and
                                                                               multiple airlines to
Business
                                                                               use any gate or
Development
                                                                               ticket counter. This
                                                                               allows the Airport to
                                                                               maximize operations
                                                                               at these locations.

                       Goal B: Maintain and            2. Retain existing      Making changes to
                       aggressively grow core             customers and        the common use
                       business                           tenants              system will require
                                                                               the airlines to
                                                                               configure their
                                                                               applications,
                                                                               resulting in a sizable
                                                                               new investment.


BUDGET & FINANCIAL IMPACT

The Aviation expense budget contains funds for consultant work of this nature. The amount
is included in the FY2011 Budget under the heading Equipment Repairs and Maintenance.

STAFFING IMPACT

This approach has been in place since 2003 and this proposed board action will have no
impact on existing staffing needs.
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SUSTAINABILITY

The common use system facilitates an increased efficiency of the utilization of current
airport facilities, which forestalls the need to construct additional terminal facilities.


ENVIRONMENTAL

CEQA Determination
The proposal to approve a supplemental agreement for continued information technology
support at the Oakland Airport was reviewed in accordance with the requirements of the
California Environmental Quality Act (CEQA), and the Port CEQA Guidelines. The general
rule in Section 15061(b)(3) of the CEQA Guidelines states that CEQA applies only to
activities that have a potential for causing a significant effect on the environment. It can be
seen with certainty that executing this professional services contract will not result in a
physical change in the environment; therefore, it is not a project under CEQA and no
environmental review is required.

Environmental Compliance
This action will not disturb soil, groundwater, or hazardous materials.

Mitigation
This action will not significantly impact the environment. Therefore, mitigation measures are
not required.

Related Plans and Policies
This action does not require mitigation measures; therefore, there are no related or adopted
plans for this project.


MARITIME AND AVIATION PROJECT LABOR AGREEMENT (MAPLA)

This contract is for professional services that do not include construction, testing and
inspection, and the provisions of the Port of Oakland Maritime and Aviation Project labor
Agreement (MAPLA) do not apply to this work.

OWNER CONTROLLED INSURANCE PROGRAM (OCIP)

This project does not fall within the OCIP program.

GENERAL PLAN

The project is limited to maintenance of existing equipment / facilities that conform to the
provisions of the Oakland General Plan, and will not change the existing use(s) of any
facility(s).

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LIVING WAGE

Based upon a review of the terms of the agreement and information provided by the
contractor, it appears that the living wage requirements set forth in Section 728 of the
Charter of the City of Oakland and Port Ordinance Number 3666, as amended, do not
apply because the contractor employs fewer than the 21 employees working on Port-
related work required for coverage.

OPTIONS

   1. Authorize the Executive Director to execute a fourth supplemental agreement with
      ARINC, Inc. to provide 2nd level maintenance support and licensing for the iMUSE
      Common Use System at the Oakland International Airport for one year for $114,252
      with the option of a second year for $114,252.

   2. Authorize the Executive Director to execute a fourth supplemental agreement with
      ARINC, Inc. to provide 2nd level maintenance support and licensing for the iMUSE
      Common Use System at the Oakland International Airport for two years for $205,992
      with the option of a third year for $102,996. While this option saves the Port some
      money, allowing the system to operate into a seventh year, will put the current
      servers beyond their expected life. A recent health check of the common use
      servers, show that the servers are operating at a high level and with routine
      maintenance should be operational until they can be replaced in 2013.

   3. Take no action. With this option, however, the maintenance of the common use
      system would terminate resulting in potential disruption of Airport operations.
      Additionally since the licensing of the software would expire, the Port could no longer
      legally operate the system.

RECOMMENDATION

It is recommended that the Board authorize the Executive Director to execute a fourth
supplemental agreement with ARINC, Inc. to provide 2nd level maintenance support and
licensing for the iMUSE Common Use System at the Oakland International Airport for two
years for $205,992 with the option of a third year for $102,996.




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              REMAINING ACTION ITEMS
Remaining Action Items are items not previously addressed
in this Agenda that may require staff presentation and/or
discussion and information prior to action by the Board.




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                                                       BOARD MTG. DATE: 3/29/11


                             AGENDA REPORT

TITLE:            Authorization to Allocate Remaining Vision 2000 Air Quality Mitigation
                  Funds to the Port Shore Power Program and to a Port Energy
                  Efficiency and Renewable Energy Study

AMOUNT:           $2.723 million

PARTIES INVOLVED:

                   Corporate Name/Principal              Location
                   West Oakland Neighbors                Oakland, CA


TYPE OF ACTION:                      Resolution

SUBMITTED BY:                        Richard Sinkoff, Director of Environmental
                                     Programs & Planning

APPROVED BY:                         Omar Benjamin, Executive Director

SUMMARY

In 1999, the Board of Port Commissioners (Board) committed to spend $8.975 million
for the Vision 2000 (V2K) Air Quality Mitigation Program (AQMP). Since then, the Port
has implemented the mitigation measures set forth in the AQMP at a total cost of
$6.252 million. Approximately $2.723 million of the AQMP funding currently remains as
a commitment in the V2K AQMP. The purpose of this Agenda Report is to request the
Board to allocate these remaining AQMP funds to the Port Shore Power Program and to
a Port Energy Efficiency and Renewable Energy Study.

FACTUAL BACKGROUND

This section describes the V2K AQMP, current status of the AQMP, current allocations,
and consultation with West Oakland Neighbors.

V2K Maritime Development Program, Berths 55-58 Environmental Impact Report (EIR)
and Mitigation, Monitoring, and Reporting Program (MMRP)

On April 20, 1999, the Board certified the Berths 55-58 Project Final EIR and adopted
mitigation measures for the Project in compliance with provisions of the California
Environmental Quality Act (CEQA) to mitigate long-term regional impacts from
emissions of reactive organic gases (ROG), oxides of nitrogen (NOx), sulfur dioxide
(SO2), and particulate matter (PM) generated by all project-related sources, including



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marine vessels, tugs, cargo-handling equipment, transport trucks and trains 1 . The Port
and West Oakland Neighbors (WON) had previously entered into a Settlement
Agreement on April 16, 1999, under which the Port agreed to include the AQMP in the
MMRP for the Berths 55-58 Project.

In the MMRP, the Board committed to the following:

               •       Spend $8.98 million on the Vision 2000 air quality mitigation
                       program.
               •       Reallocate funding among mitigation measures if any measures
                       then recommended for implementation were shown to be infeasible
                       or less expensive than assumed, should funds remain.
               •       Add new measures based upon the overall goal of maximizing the
                       quantity of emissions reduced for the dollars spent.
               •       Pursue such measures with a preference for reducing diesel
                       particulates.
               •       Pursue such measures that will reduce local, near-Port emissions.
               •       Consult with WON to keep WON informed of Port progress in
                       implementing the mitigation measures.

Vision 2000 Air Quality Mitigation Program: Current Status

The Port has successfully implemented all feasible V2K mitigation measures identified
in the MMRP, including the Container Terminal Equipment Retrofit and Replacement
Program (CTERRP), Port Truck Replacement Project, and a tugboat engine
replacement project. Collectively, the completed measures have resulted in a reduction
of approximately fifty-three (53) tons of diesel PM over the respective project lives 2 .
Other V2K mitigation measures such as engineering emissions controls at Red Star
Yeast and Precision Cast to reduce ROG emissions were pursued, but completion of
these measures became infeasible when both facilities ceased operations.

Of the original $8.975 million commitment, a total of $6.252 million has been spent to
date. The V2K AQMP Expenditure and Status Summary is provided in Table 1.




1
 Board Resolution No. 99154
2
 Port of Oakland, Final Maritime Air Quality Improvement Plan (MAQIP), Table 9-6: PM and NOx
Emissions Reductions from Early Action Projects, April 2009.
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Table 1: V2K AQMP EXPENDITURE AND STATUS SUMMARY - MARCH 2011

                                                                                  Remaining
 Measure                                         Allocation      Expenditures
              Description           Status                                         Balance
 Number                                          (million $)      (million $)
                                                                                  (million $)
              Transport
 M1                               Completed             0.076         0.076            0
              Truck Demo
              Truck
 M1(A)                            Completed             4.840         3.481            1.359
              Replacement
              Cargo
 M2           Handling            Completed             1.263         1.263            0
              Equipment
              Tugboat
 M3                               Completed             0.430         0.430            0
              Repowering
              Retrofit of AC
 M4                               Completed             0.669         0.669            0
              Busses
              Train
 M5           Switching           Infeasible            1.300         0                1.300
              Engines
              Design and
                                  Completed
              Operations
 M6                               or                    0.355         0.291            0.064
              (includes 12
                                  Infeasible
              measures)
 M7           Red Star Yeast      Infeasible            0.042         0.042            0
 M8           Precision Cast      Infeasible            0             0                0
              CARB Truck
 M9           Inspection          Infeasible            0             0                0
              Station
 TOTAL                                                 $8.975       $6.252            $2.723
Note: All amounts rounded to the nearest thousand.
Source: Port of Oakland, Environmental Programs & Planning Division, March 2011

Vision 2000 Air Quality Mitigation Program: Current Allocation

Approximately $2.723 million remains as a mitigation commitment and available for
reallocation. These funds are currently allocated to the following V2K mitigation
measures:

               •      M1(A), Truck Replacement
               •      M5, Train Switching Engines
               •      M6, Design and Operations



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Mitigation Measure M1(A), Truck Replacement: A total of $4.84 million was allocated to
this mitigation measure. In 2008, through the Truck Replacement Project, the Port
replaced 80 older drayage trucks with new, cleaner burning trucks, resulting in twelve
(12) tons of PM emissions and ninety-six (96) tons of NOx emissions reduced over a
five-year project life at a cost of $3.481 million 3,4 . $1.359 million remains in this
mitigation measure.

Mitigation Measure M5, Train Switching Engines: A total of $2.760 million was originally
allocated to this mitigation measure. The Port and Bay Area Air Quality Management
District (BAAQMD) have diligently pursued this mitigation measure with both Union
Pacific and BNSF Railway, respectively, since 2007 5 . Finally, in 2010, Port staff
determined that funding train switch locomotives was infeasible when the BNSF
declined the available grant funding. The Port worked collaboratively with the BAAQMD
to increase the available grant funding, but the rail operator decided not to proceed
even at higher grant funding levels, citing current economic conditions and the limited
need for new rail locomotives. $1.3 million remains in this mitigation measure.

Mitigation Measure M6, Design and Operations: A total of $355,000 was allocated to
this mitigation measure. Completed projects within this mitigation measure include the
West Oakland Particulate Air Monitoring Program, a compressed natural gas (CNG)
fueling station (although not funded with V2K AQMP funds), traffic signal
synchronization, and a Port-subsidized 24-hour truck parking facility, among other
projects. Some projects within this mitigation measure, including establishing an
employee cash-out policy at marine terminals, restricting parking for tenant vehicles,
and constructing a heavy-duty truck testing station at the Port, were impractical to
implement and therefore infeasible. $291,000 was spent on projects within Mitigation
Measure M6. Currently, $64,000 remains in this mitigation measure.

Vision 2000 Air Quality Mitigation Program: Updates to West Oakland Neighbors
(WON)

Under the V2K MMRP, the Port updates WON periodically on AQMP implementation
progress. Port staff has met with WON and other community representatives, provided
expenditure and status summary reports, and presented updates at community group
meetings on an on-going basis.

Most recently, Port staff:

3
  Ibid.
4
  In 2009, as part of the MAQIP, the Board provided $5 million from its FY09 operating budget to further
reduce emissions from drayage trucks. These funds were used in a collaborative $25 million program
with the Bay Area Air Quality Management District (BAAQMD), California Air Resources Board (CARB),
and the U.S. Environmental Protection Agency (EPA) to issue grants to retrofit or replace trucks serving
the seaport. As a result, 1,521 trucks were successfully retrofitted or replaced, resulting in fourteen (14)
tons of PM emissions reduced annually. None of the Port’s $5 million contribution to this program came
from the V2K AQMP funds.
5
  On May 1, 2007, the Board originally allocated $2.76 million to Mitigation Measure M5, Train Switching
Engines (Board Resolution No. 07100). In 2008, Union Pacific declined the grant funding, and, consistent
with the provisions of the MMRP, the Port transferred $1.460 million into Mitigation Measure M1(A), Truck
Replacement. The Port informed WON of the transfer in a letter dated May 21, 2008.
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               •     Met on November 17, 2010, and provided a V2K AQMP update to
                     Councilmember Nancy Nadel, Port Commissioner Margaret
                     Gordon, and Mr. Ray Kidd, WON co-chair, to provide a status
                     update and a proposed allocation to the Port Shore Power
                     Program.
               •     Presented an update on the Port Shore Power Program at the
                     WON general meeting on January 20, 2011.
               •     Met on February 24, 2011 with Mr. Kidd, Mr. Brian Beveridge (West
                     Oakland Environmental Indicators Project co-chair), Mr. Matt
                     Fidanque (West Oakland Environmental Indicators Project), Mr.
                     David McCoard (Sierra Club) and Dr. Jamie Fine (Environmental
                     Defense Fund) via teleconference to keep the community and other
                     stakeholders updated on Port progress.
               •     Met on March 10, 2011 with Mr. Kidd, Mr. Beveridge, Mr. Fidanque,
                     Mr. McCoard, Dr. Fine, and Commissioner Gordon to provide an
                     update on V2K AQMP progress.

WON members invited other stakeholders to the February 24, 2011 and March 10, 2011
meetings, to participate in the discussion. WON members indicated that they are
receptive to the Port’s proposed allocation to the Shore Power Program. Additionally,
WON and other stakeholders suggested that Port staff evaluate the following alternative
projects:

               •     Relocating West Oakland metal recycling and smelting facilities to
                     Port-owned property
               •     A Port Energy Efficiency and Renewable Energy Study.

ANALYSIS

Feasibility Criteria: All existing and proposed mitigation measures must satisfy
feasibility criteria in order to qualify for V2K AQMP funds. Feasibility is determined by
reviewing Port criteria identified in the MMRP and concluding whether or not mitigation
measures will satisfy those requirements. Specifically, the following criteria must be
addressed:

Criteria #1: Does the measure meet the Port’s mitigation requirement to reduce
emissions from local, near-Port sources?

Criteria #2:   Is the measure practical to implement?

Criteria #3:   Can the measure be implemented in a timely manner?

Additionally, new measures must also meet the following:

Criteria #4:   Does the proposed new measure meet the overall goal of maximizing the
               quantity of emissions reduced for the dollars spent? To maximize the air

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              quality benefits, can Port funds be leveraged with other available grant
              sources for additional emission reductions?

Evaluation of Current and New Mitigation Measures: To develop the recommendation
to allocate remaining V2K AQMP funds, Port staff applied these criteria to currently
funded mitigation measures (Step 1), and then to new mitigation measures (Step 2).

Step 1: Currently Funded Mitigation Measures. Port staff evaluated the feasibility of
currently funded mitigation measures.

Mitigation Measure M1 (A), Truck Replacement: This mitigation measure has
successfully met the Port’s commitment to reduce emissions from local, near-Port
sources. However, given the success of other parallel Port programs and the dramatic
progress in reducing emissions from drayage trucks, many drayage trucks have already
been replaced or retrofitted and will not need additional upgrades until 2014. Currently,
a new program for truck replacement is not practical and cannot be implemented in a
timely manner with existing Port staffing resources, and is therefore not feasible. No
additional V2K AQMP funds are recommended for this measure.

Mitigation Measure M5, Train Switching Engines: This measure meets the goal to
reduce local, near-Port emissions sources, and also leverages other available grant
sources. However, this measure cannot be implemented in a timely manner due to the
lack of financial support from rail partners. Therefore, this measure is infeasible and no
additional V2K AQMP funds are recommended.

Mitigation Measure M6, Design and Operations: Many projects within this mitigation
measure have already been completed, some with non-V2K AQMP Port funds.
Remaining projects, including an employee cash-out policy at marine terminals and a
heavy-duty truck testing station at the Port, could not be implemented in a timely
manner or would not result in reducing emissions from local, near-Port sources.
Therefore, this measure is not feasible, and no additional V2K AQMP funds are
recommended for this measure.

Step 2: New Mitigation Measures. Port staff next evaluated the feasibility of the
following proposed mitigation measures.

              •     Port Shore Power Program
              •     Relocating West Oakland Recycling Facilities
              •     Port Energy Efficiency and Renewable Energy Study

Port Shore Power Program - Port staff proposes to allocate V2K AQMP funds to the
Port Shore Power Program.

Port staff evaluated this proposed measure for feasibility criteria and concluded the
following:



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Criteria #1:    Vessel at-berth emissions are the largest source of local, near-Port
                emissions, representing 22% of the overall PM at the seaport 6 . Allocating
                V2K AQMP funds to shore power infrastructure will allow berthed vessels
                to plug in and shut off their auxiliary diesel engines, thereby eliminating
                their emissions while they are plugged in. The emissions reductions can
                be quantified based on the duration of the vessel calls 7 .

Criteria #2:    The Port has already dedicated resources, including staffing, to
                implement the Port Shore Power Program 8 , making the V2K AQMP
                allocation to shore power infrastructure a practical project to implement.

Criteria #3:    Timelines for shore power implementation have already been established,
                and terminal shore power infrastructure will be available at several berths
                in 2012, with the balance in mid to late 2013. Therefore, the proposed
                project will be implemented in a timely manner.

Criteria #4:    The Port has applied for, and has been awarded several grants to
                implement the Port Shore Power Program 9 . V2K AQMP funding may be
                leveraged to provide the required Port match to receive the grants.

In conclusion, shore power for ocean-going vessels satisfies the feasibility criteria and
therefore is recommended for an allocation of V2K AQMP funds.

Relocating West Oakland Recycling Facilities – WON suggested the Port consider
applying the remaining V2K AQMP funding towards a study of relocation of Custom
Alloy Scrap Sales (CASS), an existing metal recycling and smelting facility in West
Oakland, to a new and expanded facility on Port-owned property at the former Oakland
Army Base (OAB).

Port staff evaluated this proposed mitigation measure for feasibility criteria and
concluded the following:

Criteria #1:    The proposed mitigation measure would not reduce local, near-Port
                emission sources at the Seaport. Emissions reductions from drayage
                trucks serving the facility may decrease slightly due to reduced travel


6
  Ibid 2, Table 5-1.
7
  Several other factors are used to quantify emissions reductions, including auxiliary engine
specifications, power loads, and connection time.
8
  On September 21, 2010 and November 30, 2010, the Board approved several actions in support of the
design, construction, and financing of shore power at the Port, including the acceptance of a grant with
the U.S. Department of Transportation (the “TIGER” grant) which provides $7.85 million for shore power.
The TIGER grant requires completion of grant-funded infrastructure in February 2012. The Port plans to
use the TIGER grant at Berths 56, 57 and 58, three berths within the Port’s twelve-berth shore power
program. As a priority, staff proposes that the $2.623 million remaining in the V2K AQMP be part of the
Port’s contribution for the construction of shore power infrastructure at Berths 56, 57, and 58. If not
needed for Berths 56, 57, and 58, the V2K funding will be allocated for the construction of shore power
infrastructure at other berths in the next construction phase of the Port Shore Power Program.
9
  Ibid.
                                                     7




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                distances, but other facility emissions sources would now be attributable
                to the Port and continue to impact West Oakland receptors.

Port staff compared the emissions from CASS with those from ships-at-berth by
reviewing the most recent health risk analyses conducted by BAAQMD and California
Air Resources Board (CARB). In its analysis, BAAQMD estimated a total of 0.024 tons
annually for all toxic air contaminants from the CASS facility 10 . Additionally, BAAQMD
conducted one year of air monitoring at CASS to supplement its findings. By
comparison, CARB studied all Port emission sources in 2008, estimating a total of 60.6
tons of diesel PM (a toxic air contaminant) annually from ships-at-berth 11 . The results
from further studies likely will not change the results already compiled by BAAQMD and
CARB 12 . Therefore, V2K AQMP funding would not maximize the amount of reduced
emissions per dollar spent.

Criteria #2:    The proposed mitigation measure would not be practical to implement,
                since expanded CASS facility would occupy a significant area on the OAB
                and therefore potentially preclude other opportunities to develop the area
                for transportation and logistics uses directly related to Port maritime
                operations. Also, CASS representatives have stated that they would only
                relocate to a property location they could own, and leasing property would
                be unacceptable 13 .

Criteria #3:    The proposed mitigation measure could not be implemented in a timely
                manner, as any new or expanded industrial facility on the OAB would
                require additional CEQA environmental review and permitting. Also,
                existing environmental conditions at the OAB may worsen due to the
                typical hazardous materials used at the recycling facility. Given the
                uncertainty of the impacts and mitigation, no implementation timeline can
                be proposed.

Criteria #4:    Relocating the CASS facility onto Port OAB property would not mitigate
                air quality impacts from seaport sources. Emissions would not decrease
                in the Port area, and, in fact, would increase if the facility were relocated
                to the OAB. Relocation of CASS onto Port property would increase the
                Port’s total emissions since the CASS emissions would be attributed to
                the Port. This would make it more difficult for the Port to meet its air
                quality goal of an 85% reduction from 2005 to 2020 in the seaport’s diesel
                health risk to West Oakland 14 . Finally, relocation of the facility to Port
                property would continue to impact West Oakland as a whole, even though

10
   Bay Area Air Quality Management District, AB2588 Health Risk Analysis for Custom Alloy Scrap and
Sales, Inc. 2008. Note that the analysis does not account for engineering improvements completed after
the study, or include mobile sources.
11
   California Air Resources Board, Diesel Particulate Matter Health Risk Assessment for the West
Oakland Community, 2008.
12
   To the Port’s knowledge, no major changes to operations or technology have take place at the CASS
facility since the monitoring performed by the BAAQMD.
13
   BAAQMD West Oakland Particulate Matter/Metals Measurement Meeting, January 13, 2011.
14
   Port Maritime Air Quality Policy Statement, March 18, 2008, Board Resolution No. 08057.
                                                     8




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               the areas currently directly adjacent to the current facility may experience
               a decrease in CASS-related emissions. Therefore, the proposed
               mitigation measure would not decrease local, near-Port emissions, and
               may increase the emissions if the facility were expanded.

In conclusion, supporting the relocation of CASS with V2K AQMP funding does not
satisfy the criteria and is not recommended for V2K AQMP funding.

Port Energy Efficiency and Renewable Energy Study – Due to the increasing power
demands from existing Port facilities and upcoming projects such as shore power and
Oakland Army Base development, WON suggested that the Port allocate up to
$100,000 in V2K AQMP funds to conduct a comprehensive evaluation of Port energy
sources, future demand, and feasible strategies to increase energy efficiency and use of
renewable energy sources, thereby reducing emissions from fossil-fueled, diesel power
generation sources. Additional funding from other contributors may be necessary to
fund a portion of the proposed study.

Port staff evaluated this proposed measure for feasibility criteria and concluded the
following:

Criteria #1:   The proposed mitigation measure would provide recommendations to
               reduce emissions from fossil-fueled, diesel power generation sources at
               the Port. While the proposed study itself would not reduce emissions,
               implementing any viable recommendations to increase renewable energy
               usage and improve the efficiency of Port energy sources could result in a
               net decrease in emissions near (and away from) the Port. The study
               would provide the Port with additional information on energy efficiency,
               renewable energy opportunities, and emissions reduction strategies not
               considered at this time.

Criteria #2:   The proposed study would be practical to implement.

Criteria #3:   The proposed mitigation measure could be implemented in a timely
               manner once the project scope has been finalized. Additional discussions
               between WON, other stakeholders, Port Utilities Administration
               Engineering, and Port Environmental Programs & Planning staff to further
               scope the project are necessary before a final scope and timeline can be
               determined.

Criteria #4:   The proposed mitigation measure may provide new information and
               recommendations to further increase energy efficiency and further reduce
               emissions from fossil-fueled, diesel power generation sources. Viable
               recommendations to increase renewable energy usage and energy
               efficiency could lead to cost-effective emissions reduction measures.

In conclusion, Port staff proposes to allocate up to $100,000 in V2K AQMP funds
towards a Port Energy Efficiency and Renewable Energy Study, once the project scope
is finalized and can be evaluated to ensure that study results would lead to direct
                                               9




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emissions reductions. If the study is feasible, the Port’s commitment would be limited to
the proposed funding of up to $100,000. If the Port ultimately determines that the study
is infeasible, then the allocated funds shall be re-allocated to support the Port Shore
Power Program instead.

RELATIONSHIP TO STRATEGIC PLAN

The Strategic Plan (adopted by the Board on October 5, 2010) operates on a fiscal year
schedule for five years. Each fiscal year represents a stage in implementation. For FY
2010-2011, the focus is on activities that will continue to stabilize Port businesses and
finances. The requested actions stabilize the Port’s finances by reducing the Port’s
long-term capital needs by $2.623 million which contribute to the Port’s financial health
and continue to strengthen the successful implementation of the Port Shore Power
Program.

These actions also promote stability by completing an outstanding environmental
commitment of the Port, the V2K AQMP. Moreover, the actions implement the following
Strategic Plan Goals:


 Strategic          Goal                 Objective              How and When Plan is
 Priority Areas                                                 Implemented
 Sustainable        B: Maintain and      1: Retain existing     Shore power infrastructure will
 Economic and       aggressively grow    customers              allow existing customers to
 Business           core businesses                             continue serving Port facilities
 Development                                                    while complying with regulations in
                                                                accordance with terminal plans
                                                                filed with CARB by the Port’s
                                                                marine terminals in June 2009.


 Stewardship and    G: Sustain healthy                          The allocation of V2K AQMP funds
                                         1: Ensure effective
 Accountability     communities                                 to a Port Energy Efficiency and
                                         communication and
                    through leading                             Renewable Energy Study is a
                                         education regarding
                    edge environmental                          direct result from ongoing dialogue
                                         environmental and
                    stewardship                                 between the Port and community
                                         safety standards
                                                                stakeholders, and the benefits from
                                         with business
                                                                the analysis may yield additional
                                         partners and the
                                                                emissions reductions and cost
                                         community.
                                                                savings.


                                         5: Develop effective   The allocation of V2K AQMP funds
                                         relationships with     to the Shore Power Program
                                         regulatory and         further solidifies relationships with
                                         resource agencies.     partnering agencies such as U.S.
                                                                Department of Transportation,
                                                                BAAQMD, and CARB by
                                                                committing funds to match
                                                                available grants.



                                               10




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BUDGET & FINANCIAL IMPACT

This action does not involve costs beyond those previously committed to by the Board
for the V2K AQMP. Of the total $8.975 million commitment, a remaining total of $2.723
million is committed on emissions reduction measures. The allocation and expenditure
of the remaining V2K AQMP funds to the Shore Power Program and a Port Energy
Efficiency and Renewable Energy Study does not increase Shore Power Program costs
and provides the following:

                       Satisfies the Port’s V2K AQMP commitment to spend in aggregate
                       $8.975 million for air quality mitigation measures;

                       Reduces the Port’s 5-year Capital Needs Assessment (CNA) by
                       approximately $2.623 million. The $2.623 million of V2K AQMP
                       capital expenditures would be part of the approximately $90 million
                       already identified for shore power in the Port’s 5-year CNA;

                       Funds up to $100,000 toward a comprehensive analysis of Port
                       energy usage and renewable energy opportunities, thereby
                       potentially reducing emissions and costs.

Additional discussion on funding for the Port Shore Power Program was presented to
the Board on November 30, 2010 15 .

STAFFING IMPACT

Current Port staff assigned to implement the shore power program will track the use of
V2K AQMP funds for shore power implementation. No additional staffing is needed.
Existing staff would oversee the efforts to scope the Port Energy Efficiency and
Renewable Energy Study. A final determination of resource needs will be made once
the scoping process is concluded. To the extent possible, the Port will partner with
outside agencies to complete the study.

SUSTAINABILITY

Approving the allocation of V2K AQMP funding for shore power infrastructure promotes
environmental sustainability by directly supporting emissions reduction goals. Shore
power has been identified as an early action measure to achieve the greenhouse gas
emission reduction goals established under AB 32, the California Global Warming
Solutions Act of 2006.

Approving an allocation of V2K AQMP funding towards a Port Energy Efficiency and
Renewable Energy Study promotes sustainability by promoting emissions reductions
and cost savings through energy efficiency.

15
  Agenda Report: Authorizations (various) to further implementation of the Port’s Shore Power Program,
including acceptance of grant funding and actions required for the commencement of construction,
November 30, 2010. Board Resolution Nos. 10-161 and 10-162.
                                                    11




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To further promote the public engagement process, Port staff presented both proposed
mitigation measures to WON and other stakeholders. The Port will continue to meet
with the stakeholders to further scope the Port Energy Efficiency and Renewable
Energy Study.

ENVIRONMENTAL

The CEQA Guidelines, Section 15061(b)(3) (“the general rule”) states that CEQA
applies only to projects which have the potential for causing a significant effect on the
environment. It can be seen with certainty that reallocating V2K funds will not have a
significant effect on the environment, and therefore is not a project under CEQA, and no
environmental review is required.

The Port already conducted CEQA review of the shore power program, which is a
proposed use of the reallocated funds. On May 18, 2010, with Resolution No. 10-56, the
Board of Port Commissioners adopted the Final Initial Study/Negative Declaration for
the Maritime Utilities Upgrade Project, which encompasses construction and operation
of the Port Shore Power Program.

A Port Energy Efficiency and Renewable Energy Study would be categorically exempt
from requirements of CEQA and the Port CEQA Guidelines pursuant to CEQA
Guidelines, Section 15306 (Class 6), which exempts basic data collection, research,
experimental management and resource evaluation activities that do not result in a
serious or major disturbance to an environmental resource.

The proposed action implements the V2K AQMP that the Board adopted as part of its
certification of the Berths 55-58 Project Final Environmental Impact Report (“EIR”) on
April 20, 1999 with Resolution No. 99154.

MARITIME AND AVIATION PROJECT LABOR AGREEMENT (MAPLA)

An allocation of funding does not fall within the scope of the Port of Oakland Maritime
and Aviation project Labor Agreement (MAPLA), and the provisions of the MAPLA do
not apply.

OWNER CONTROLLED INSURANCE PROGRAM (OCIP)

The proposed project does not fall within the scope of the Owner Controlled insurance
program (OCIP), and the provisions of the OCIP do not apply.

GENERAL PLAN

The proposed project does not include any alteration of property. The provisions of the
General Plan do not apply.

LIVING WAGE

                                             12




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Based upon a review of information provided, it appears that neither the Port’s Living
Wage Ordinance (Port Ordinance No. 3666) nor living wage requirements set forth in
Section 728 of the Charter of the City of Oakland, apply at this time.

OPTIONS

The Board of Port Commissioners has the following options:

              1)    Authorize the allocation of up to $100,000 towards a Port Energy
                    Efficiency and Renewable Energy Study, if feasible; authorize the
                    allocation of the remaining Vision 2000 Air Quality Mitigation
                    Program funds (approximately $2,623,000) to the Port Shore Power
                    Program; authorize the Executive Director to determine the
                    feasibility of the Study; and if the Study is infeasible, authorize the
                    Executive Director to re-allocate the up to $100,000 to the Shore
                    Power Program.

              2)    Authorize the allocation of all remaining Vision 2000 Air Quality
                    Mitigation Program funds to the Port Shore Power Program.

              3)    Do not authorize any reallocation of Vision 2000 Air Quality
                    Mitigation Program funds at this time.

RECOMMENDATION

Authorize the allocation of up to $100,000 towards a Port Energy Efficiency and
Renewable Energy Study, if feasible; authorize the allocation of the remaining Vision
2000 Air Quality Mitigation Program funds (approximately $2,623,000) to the Port Shore
Power Program; authorize the Executive Director to determine the feasibility of the
Study; and if the Study is infeasible, authorize the Executive Director to re-allocate the
up to $100,000 to the Shore Power Program.




                                              13




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                                                           Port of Oakland


Figure 1: Location of Berths Within the Port’s Shore Power Program


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                       205 of 208
                             UPDATES & ANNOUNCEMENTS Tab 7



            UPDATES & ANNOUNCEMENTS
The President and / or Executive Director will report on
noteworthy events occurring since the last Board Meeting.




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                                               UPDATES & ANNOUNCEMENTS Tab 7.1




                                   City/Port Liaison Committee
                                          March 3, 2011

The meeting was called to order at 6:10 p.m. and in attendance were City of Oakland Mayor Jean
Quan, Councilmember/Co-chair Nancy Nadel, Councilmember Rebecca Kaplan, Councilmember
Libby Schaaf, Commissioner/Co-chair Margaret Gordon, and Commissioner Michael Lighty.

    The November 4, 2010 meeting summary was approved by consensus.

    The Committee confirmed the agenda for the next meeting on May 5, 2011 including:

                   Update from the City of Oakland on Enforcement of Commercial Truck Parking
                    and Truck Route in West Oakland (Standing Item)
                   Update from the California Air Resources Board Regarding the Status of the
                    Drayage Truck Emission Regulation and the Statewide Truck and Bus
                    Regulation, Including and Update from the Bay Area Air Quality Management
                    District Regarding Enforcement of Truck Regulations
                   Update on the Port of Oakland's Maritime Air Quality Improvement Plan,
                    Including Comprehensive Truck Management Plan (Standing Item)
                   Report on the Impacts of Proposed State Policy to Eliminate Redevelopment on
                    the City of Oakland Enterprise Zone and Redevelopment Activities
                   Update Report on the Development of the Alameda County Transportation Plan
                    Including Goods Movement Component

    Pat Cashman and Al Auletta from the City of Oakland Redevelopment Agency, and Port of
     Oakland Maritime Senior Projects Administrator Mark Erickson updated the Committee on
     development plans on the former Oakland Army Base. The City and Port staff will report further
     details of respective project timing and schedules at the June Committee meeting.

    Ramona Dixon from the Port of Oakland Maritime Division provided an update on new
     management agreements for the operations and services at the Middle Harbor Shoreline Park
     including ongoing maintenance, security, and education and outreach.

    Officer Jim Gordon from the Oakland Police Department provided an update on enforcement
     activities of the West Oakland Truck Route including commercial truck parking and traffic.

    Richard Sinkoff, Port Director of Environmental Programs and Planning, and Tim Leong, Port
     Environmental Scientist, gave an update on projects identified in the Maritime Air Quality
     Improvement Plan (MAQIP). Ralph Reynoso, Port Maritime Wharfinger, gave an update on the
     implementation of the Maritime Comprehensive Truck Management Program (CTMP). Port staff
     will report items requested for further follow-up at the next Committee meeting in May.

The meeting adjourned at 8:05 p.m.




                                             Page 1 of 1

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                                            SCHEDULING Tab 8



                      SCHEDULING
This segment of the meeting is reserved for scheduling
items for future Agendas and/or scheduling Special
Meetings.




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