California Pacific Medical Center Hospital Rebuild Board of Supervisors

1. California Pacific Medical Center Hospital Rebuild Board of Supervisors Land Use & Economic Development Committee Staff Presentation June 17, 2013

2. CPMC Rebuild Project: Overview • CPMC’s Near-Term Projects include 5 new buildings, including: • Two new buildings at the St. Luke’s Campus • Two new buildings at a new, Cathedral Hill Campus • One new building at the Davies Campus 2

3. PreviousNew Cathedral Hill Hospital: Beds 555 274 * Floors 15 12 Height (ft) 265 226 Size (sq. ft) 875,378 730,888 Parking (campus) 1227 990 St. Luke’s Hospital: Beds 80 120 Floors 5 7 Height (ft) 99 142 Size (sq. ft) 146,410 214,061 Parking (spaces) 450 450 Revised Project Details * Option to add 30 additional beds at Cathedral Hill if St. Luke’s reaches 75% bed utilization. 3

4. Construction of a new, 214,061 gsf, 7-story, 120-bed, full service acute care hospital Includes Centers of Excellence in Community and Senior Health Increase of 40 beds, 67,651 gsf, and +/- 43’-0” from Previous Project St. Luke’s Campus Project Description ST. LUKE’S HOSPITAL • Construction of a new entry plaza and pedestrian pathway adjacent to the hospital entrance, connecting 27th Street & Cesar Chavez Street • Demolition of the existing hospital when new hospital is complete • Construction of new, five-story medical office building 4

5. Cathedral Hill Campus Project Description • Construction of a new 730,888 gsf, 12-story, 274-304 bed hospital at the site of the closed Cathedral Hill Hotel (Van Ness & Geary) • Reduction of 251 beds, 144,490 gsf, 237 parking spaces, and +/- 39’-0” • Construction of a new, 130’ tall, nine-story medical office building across Van Ness from the Hospital • Construction of an underground tunnel beneath Van Ness connecting the two buildings CATHEDRAL HILL HOSPITAL 5

6. Davies Campus Project Description • A new 4-story medical office /clinic building housing the Neuroscience Institute on an existing surface parking lot, at the corner of Duboce and Noe. • Includes a new “MUNI lobby” that connects the lowest portion of the Campus with the N-Judah MUNI train line across Duboce Avenue. DAVIES NEUROSCIENCE INSTITUTE • Includes streetscape Improvements: a wider sidewalk on Noe; bulbouts at the NE and SE corners of Noe; street furnishings along Noe; and new landscaping/tree plantings. 6

7. Land Use Approvals

8. Land Use Approvals • General Plan Amendments • St. Luke’s & Cathedral Hill • Planning Code Text & Map Amendments • St. Luke’s & Cathedral Hill • Development Agreement • All campuses • Street Vacation & Conveyance • St. Luke’s • Cedar Street Two-Way Conversion • Cathedral Hill • Sidewalk Width Changes • St. Luke’s & Cathedral Hill • Major Encroachment Permits • St. Luke’s & Cathedral Hill 8

9. Modifications recommended to the DA: Amend Section 4.2.1 to provide for Delay Payment Conform all language in the DA re: entry level hiring. Goal: fill at least 40% of Available Entry Level Positions with System Referrals. Strike Exhibit K, Item 9, eliminating the requirement for the Cathedral Hill parking garage to close to the public at 7 pm. Amend Section 8.2.2. to provide additional notice to various parties Including SFHHJJ – of Planning’s receipt of CPMC’s annual Compliance Statement; issuance of the “City Report”; and any formal requests to the Planning Department for changes to the DA. Consider asking CPMC to either retain existing in-patient psychiatric beds, or provide community-based psychiatric services through the Innovation Fund of the DA. Commission’s Recommendations 9

10. Key Overall Points: Development Agreement: Review • Significantly larger new St. Luke’s Hospital (120 versus 80 beds) and significantly smaller new Cathedral Hill Hospital (304 versus 555 beds). • St. Luke’s hospital will be an integral part of the CPMC system, with about 25% of all CPMC’s beds in the City. • CPMC obligated to continue providing a specified level of charity care to the neediest San Franciscans, with no reference to CPMC’s financial condition or projections. • About $80 million in cash for community benefits related to healthcare, transportation, workforce training, affordable housing, and pedestrian safety 10

11. St. Luke’s: Development Agreement: Review • St. Luke’s will be a 120-bed general acute-care hospital with emergency department • CPMC must open the new St. Luke’s Hospital within 24 months after opening the new Cathedral Hill Hospital (24-month period needed to re-engineer and re-permit new, larger St. Luke’s hospital) • Instead of previous 80-bed St. Luke’s hospital with 20-year operating covenant St. Luke’s at 120 beds is more sustainable and comprises almost 25% of CPMC’s beds in the City • St. Luke’s required to have Centers of Excellence in senior and community health, with services specified in DA • St. Luke’s required to provide all standard services found in general acute-care hospitals, as specified by state law. • CPMC must submit a proposal for a new medical office building within five years or else the City shall have the right to acquire a long-term lease for the site for purpose of constructing a medical office building 11

12. Healthcare Development Agreement: Review • For 10 years, CPMC shall care for a baseline of about 30,000 charity care or Medi-Cal patients annually, as well as fund $8 million in other services for the poor and underserved • CPMC must be the hospital partner, primarily in the new Cathedral Hill Hospital, for an additional 5,400 Medi-Cal Managed Care beneficiaries for 10 years, 1,500 of which must come through a primary care provider serving the Tenderloin • Above commitments are absolute for 10 years and do not depend in any way on CPMC’s financial condition or projections. • CPMC will fund an $8.6 million Healthcare Innovation Fund to increase the capacity of community-based healthcare providers • CPMC will limit increases to insurers for the City’s Healthcare Innovation Fund to 5% annually for years 1 and 2 and no more than the medical inflation rate plus 1.5% for years 3 through 10 12

13. Development Agreement: Review • Affordable Housing • CPMC will pay $4.1 million to Mayor’s Office of Housing for 25 displaced housing units on Cathedral Hill • CPMC will pay $36.5 million to Mayor’s Office of Housing affordable housing fund, in furtherance of the goals of the Van Ness Special Use District 13

14. Development Agreement: Review • Local Hire and Workforce Training • CPMC will observe 30% local hire for construction jobs; including 50% local hire for new apprentice positions • CPMC will observe 40% local hire for entry level permanent jobs for 10 years • CPMC will provide $4 million for workforce training programs 14

15. Development Agreement: Review • Transportation • CPMC will pay $6.5 million to SFMTA in lieu of TIDF • CPMC will pay $5 million to SFMTA for BRT facilities at Van Ness and Geary • CPMC will charge a parking fee of $0.50 at off-peak times and $0.75 at peak times for each car entering and exiting the Cathedral Hill garages • CPMC will pay SFMTA 400,000 for bicycle studies • CPMC will conduct surveys evaluating the effectiveness of its mandatory Transportation Demand Management (TDM) program and report the results to SFMTA and the Planning Department • CPMC will fund transportation studies every 3 years at a cost of up to $40,000 each, around Cathedral Hill to assist the City in monitoring congestion in this area • CPMC will encourage all of its employees to purchase a Clipper Card, through a variety of outreach means, and will share the cost equally with employees 15

16. Development Agreement: Review • Streetscape and Pedestrian Safety • Cathedral Hill Campus: • $4.25 million to the City for pedestrian lighting and sidewalk widening in the Tenderloin • $200,000 to the City to fund a Tenderloin safe passage pilot program • $1.55 million to the City for transit and safety improvements in the neighborhoods around the Cathedral Hill campus • Pacific and California Campuses: • $3 million to the City for enforcement and traffic safety improvements around CPMC’s Pacific and California campuses • St. Luke’s Campus • $3.3 million in in-kind streetscape and pedestrian improvements • Davies Campus • $475,000 in in-kind streetscape and pedestrian improvements 16

17. Development Agreement: Payment Schedule 17

18. Development Agreement: Proposed Amendments DA Exhibit K, Section 9 – Cathedral Hill Campus Parking Garages • Planning Commission recommended striking this provision, which requires that the CPMC Cathedral Hill parking garages be available only to visitors, employees and staff after 7pm. 18

19. Development Agreement: Proposed Amendments Section 4.2.1 (d) – St. Luke’s “Delay Payments” • DA provides that the new St. Luke’s Hospital must be opened within 24 months of the Cathedral Hill Hospital opening. (This delay is due to the need for St. Luke’s, but not Cathedral Hill, to be re-permitted by state OSHPD) • DA already includes liquidated damages that begin at the two-year point. • New language establishes “delay payments” starting at year one. These are not damages, and would not represent a default of the DA. • Starting one year after Cathedral Hill opens, if St. Luke’s has not opened, delay payments start at $2,500 per day for the first five months, and increase to $5,000 per day for the next seven months. • At 24 months, the actual liquidated damages begin. [This new language recommended by Planning Commission at its May 23, 2013 hearing.] 19

20. Development Agreement: Proposed Amendments Exhibit E, Section D – Workforce Training Payment • DA provides $4 million payment from CPMC to the City to support workforce training. • Proposed change would be for $3 million of this $4 million to go to the San Francisco Foundation instead of directly to the City. • SF Foundation would handle the funds similarly to the way it is handling the Healthcare Innovation Fund. Funds would be dispersed with joint approval of the City’s Director of Workforce Development, the Foundation and CPMC • Guidelines for expenditure of the funds would remain the same as currently outlined in this section of the DA. • The remaining $1 million would be payable directly to the City 30 days after the effective date of the DA. 20

21. Section 8.2.2 – Monitoring and Enforcement - background Development Agreement: Proposed Amendments • DA has a variety of obligations • Cash obligations are majority and are simple to monitor and enforce • Some performance obligations require more oversight – i.e. healthcare, workforce and traffic/transportation • City departments with relevant expertise are well-equipped to monitor performance – DPH, MTA, OEWD, Planning • DA already requires an annual report from CPMC on compliance with all obligations, with appropriate backup documentation, as well as an annual third-party audit on baseline charity care obligations • City Attorney can initiate enforcement action if Directors of Planning or Public Health find non-compliance. Also the Board of Supervisors can direct the City Attorney to initiate an action • Not advisable to confer contractual rights to monitor or enforce compliance with DA on particular community group or groups • However, in response to public and Commissioner concerns, staff worked with Supervisors Chiu, Farrell and Campos and CPMC to craft more robust public process and involvement around annual compliance 21

22. DA Section 10.5 – Future Changes to the DA - background Development Agreement: Proposed Amendments • Non-material changes require approval of Planning Director and director of any affected City agency and City Administrator, and Planning Commission, each in sole discretion • Material Changes require in addition to the above, approval of Board of Supervisors • “Material Change” is defined broadly to include any changes to the public benefits 22

23. Section 8.2.2 – Monitoring and Enforcement – proposed changes New language was negotiated with CPMC, Mediator, and Supervisors Farrell, Campos and Chiu Section 8.2.1 already requires an annual Compliance Report from CPMC and Exhibit F, section 13.b already requires an annual third party audit of the baseline healthcare commitment Section 8.2.2 proposed to be amended to augment the City’s annual public review process as follows: Require CPMC Compliance Report and third party review to be made available for public review immediately and posted on Department websites Require a 30 day public comment period on these documents Require City’s Report on compliance to address a list of specified issues Require annual hearings on compliance at both Planning and Health Commissions Establish “third-party monitor” to advise Board on compliance [This new language recommended by Planning Commission at its May 23, 2013 hearing.] Responsibility for initiating any necessary enforcement actions continues to rest with the Directors of Planning and Health. (Board of Supervisors also has the power to direct City Attorney to initiate enforcement actions) Development Agreement: Proposed Amendments 23

24. Section 8.2.2 – Noticing – proposed changes In response to concerns about community notice of any potential change to the DA, Planning Commission recommended adding additional requirements as follows: Planning Department shall maintain a list of interested individuals and community groups Planning Department must send notice to these groups and individuals at the time of each annual compliance review and whenever any hearing regarding the CPMC DA is calendared at the Planning Commission, including but not limited to any proposed changes to the DA [This new language recommended by Planning Commission at its May 23, 2013 hearing.] Development Agreement: Proposed Amendments 24

25. Additional changes Amend DA section 1.68 to add the following to definition of “material” changes to DA: “CPMC’s obligation to construct a 120-bed general acute care hospital at the St. Luke’s Campus as set forth in Section 4.2.1” Specify that required notice to interested groups and individuals be at least 60 days before a hearing at the Planning Commission At the request of the Community Coalition, specify that the approval process for making any non-material change to the DA will revert to that specified in the Development Agreement Statute and Chapter 56 of the Administrative Code, with the added provision that any non-material change would need to be approved by the Planning Commission in addition to this process. Development Agreement: Proposed Amendments 25

26. Proposed Monitoring/Schedule Procedures

27. Thank you and questions 27

28. EXTRA SLIDES 28

29. Van Ness BRT and Relation to CPMC Van Ness BRT Award Construction November 2015 Issue Notice to Proceed in December 2015 Cathedral Hill Hospital begins late 2013/early 2014 (24 months ahead) Tunnel under Van Ness completed by the end of 2015 (completed before) Medical Office Building begins Start of 2015 (12 months ahead) Van Ness BRT Substantial Completion of Construction December 2017 The Van Ness BRT project will be staging construction along a 2 mile corridor Work can be staged/scheduled to avoid significant conflicts with CPMC projects The project teams are in communication and will make every effort to coordinate work to minimize interference/impact with each other and on the community Commissioner Concerns 29

30. Planning Code Text & Map Amendments • ST. LUKE’S CAMPUS • Planning Code Text Amendments • Add section 249.68 to establish the Cesar Chavez/Valencia Streets Medical Use SUD • Add section 124(k) to allow an FAR of 2.6 to 1 within the SUD • Planning Code Map Amendments • Amend Sheets HT07 and SU07 to reclassify the replacement Hospital site from a 65-A to 145-E at the location of the hospital tower, and to 105-E for the balance of the campus, and to show the SUD boundaries. 30

31. Planning Code Text & Map Amendments • CATHEDRAL HILL CAMPUS • Planning Code Text Amendments • Amend section 243 (VNSUD), to create the Van Ness Medical Use Subdistrict that would allow deviations from certain Planning Code Sections through CU • Amend section 124(d) to allow an FAR up to 7.5:1 for the MOB Site • Planning Code Map Amendments • Amend Sheet HT02 and SU 02 to reclassify the Hospital Site from 130-V to 230-V Height and Bulk District and to show the boundaries of the new Subdistrict. 31

32. General Plan Amendments • ST. LUKE’S CAMPUS • Urban Design Element • Map 4 (Height Map) • Map 5 (Bulk Map) • CATHEDRAL HILL CAMPUS • Van Ness Area Plan • Text Amendments • Map 1 (Generalized Land Use and Density Plan) • Map 2 (Height and Bulk Districts) • Urban Design Element • Map 5 (Bulk Map) 32

33. 2 Yr. Update Submitted in 2011: No substantive changes to 2009 IMP 2 Yr. Update Submitted in 2013 CPMC’s annual Compliance Statements will be submitted in-lieu of IMP 2 year Updates. Next Full IMP due 2019, or sooner if there are significant revisions IMP Status Full IMP “Accepted” in 2009 33

34. Reduced Parking at Cathedral Hill Revised CPMC parking numbers are less than Previous Project by approximately 237 spaces. New parking quantity is lesser of either 125% of the Planning Code Requirement or 990 Spaces. Commissioner Concerns 34

35. Mental Healthcare Commissioner Concerns • CPMC provides inpatient psychiatric beds at the Pacific Campus and provides other mental health services • DA makes care for mental health needs specifically eligible for support from Innovation Fund through partnerships with CBOs • Engaged for the last year in discussions with CPMC on a potential partnership • Envision a linkage between St. Luke’s and Dore Urgent Care Center for patients in psychiatric crisis • Dore Urgent Care Center already partners with San Francisco General Hospital • Expanded partnership would • Allow Dore to provide onsite services at St. Luke’s to accept patients in psychiatric crisis into Dore Urgent Care • Individuals diverted from St. Luke’s will be provided crisis intervention, medication support, psychosocial counseling and connections to other needed services • Leverage an existing community-based program designed to support the City's hospital emergency rooms • Be less restrictive, more appropriate, and more cost effective than inpatient care 35

36. Monitoring Healthcare Commitments in the DA Commissioner Concerns • DA provides DPH and the Health Commission with oversight of health care compliance • Independent third party will review CPMC data that cannot be verified by other publicly available sources • DPH staff have health care expertise and will prepare an analysis of CPMC’s compliance report • DPH will be open to community input during the development of the analysis • Health Commission will hold a public hearing on the report • DPH and the Health Commission will determine CPMC’s compliance with the health care provisions of the DA • Pursuant to City Charter, responsibility and authority to preserve, promote, and protect health in San Francisco rests with the Health Commission 36