Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Sohn

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1 BOARD OF HARBOR COMMISSIONERS President Cindy Miscikowski Vice President David Arian Commissioner Robin M. Kramer Commissioner Douglas P. Krause Commissioner Sung Won Sohn Meeting Start Time: 8:40 a.m. Present: Absent: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Sohn PRESIDENT CINDY MISCIKOWSKI PRESIDED A. OPENING STATEMENT AN OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO ADDRESS THIS BOARD PERSONS IN THE AUDIENCE MAY ADDRESS THIS BOARD IN CONNECTION WITH ANY AGENDA ITEM OR DURING THE PUBLIC COMMENT PERIOD. AS PROVIDED BY THE BROWN ACT, THE BOARD HAS LIMITED EACH INDIVIDUAL S SPEAKING TIME TO THREE MINUTES. ANYONE DESIRING TO SPEAK DURING THE PUBLIC COMMENT PERIOD IS REQUESTED TO COMPLETE A SPEAKER CARD AND SUBMIT IT TO THE COMMISSION SECRETARY, VIA THE SERGEANT AT ARMS, PRIOR TO THE START OF THE MEETING. Commission actions, except actions which are subject to appeal or review by the Council pursuant to other provisions of the Charter, ordinance or other applicable law, are not final until the expiration of the next five meeting days of the City Council during which the Council has convened in regular session. If the Council asserts jurisdiction during this five meeting day period the Council has 21 calendar days thereafter in which to act on the matter. Page 1 of 16

2 B. COMMENTS FROM THE PUBLIC ON NON-AGENDA ITEMS President Cindy Miscikowski called on comments from the public. The following persons commented: June Burlingame Smith, Coastal San Pedro Neighborhood Council Debra Babcock Doherty, POLA Port Community Advisory Committee Dan Mariscal, Engineers & Architects Association C. EXECUTIVE DIRECTOR REMARKS Executive Director Geraldine Knatz announced the following: The Port of Los Angeles had a Grand Opening and Open House of the Archives on April 11 th. The Port of Los Angeles was honored with the President E-Star Award. This is an award given to persons, firms, or organizations which contribute significantly in the effort to increase United States export trade. Dr. Knatz reported that the Port of Los Angeles Team attended the Supreme Court Hearing for the American Trucking Association lawsuit and the Harbor Department is waiting to receive the results. On April 13 th and 14 th, the Los Angeles Port Police participated in the Baker to Vegas Challenge Cup Relay 2013 and received 3 rd place. D. REPORTS OF THE COMMISSIONERS President Cindy Miscikowski reported that she met with Michelle Grubbs of Pacific Merchant Shipping Association. Michelle Grubbs wanted to express PMSA s concern about the California Port s consideration of general tariff that would be imposed upon all the Ports within the State. She also reported that she had a meeting at Los Angeles City Hall with Dr. Knatz, Mayor Villaraigosa, and Councilman Buscaino. Page 2 of 16

3 D. (Continued) Vice President Arian reported that he met with Councilman Rosendahl, Councilman Alarcon, and Councilman Buscaino regarding the Southern California International Gateway. E. BOARD COMMITTEE REPORTS Commissioner Krause reported on the 7:00 a.m. Audit Committee of April 18, F. APPROVAL OF MINUTES Minutes of the Regular Meeting of February 7, 2013 and the Minutes of the Regular and Special Meetings of February 21, 2013 for approval. RECOMMENDATION APPROVED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Sohn. (5) G. PRESENTATIONS Port Police Audit The following persons provided a presentation on the Port Police Audit: Jim Olds, Finance Division Michael De Castro, Bazilio Cobb Associates Chief Boyd, Los Angeles Port Police Assistant Chief Hillman, Los Angeles Port Police Page 3 of 16

4 H. BOARD REPORTS OF THE EXECUTIVE DIRECTOR CONSENT ITEMS (1-5) Business & Trade Development 1. Re: RESOLUTION NO APPROVAL OF FOREIGN-TRADE ZONE GENERAL PURPOSE OPERATING AGREEMENT BETWEEN THE CITY OF LOS ANGELES HARBOR DEPARTMENT AND CUSTOM AIR WAREHOUSE INC. AND CUSTOM GOODS, LLC, FTZ 202, SITE 32 SUMMARY: The City of Los Angeles Harbor Department (Harbor Department), as the Foreign-Trade Zone (FTZ) grantee, establishes General Purpose Operating Agreements with FTZ operators to oversee their FTZ operations. The Harbor Department received a request from Custom Air Warehouse, Inc. and Customs Goods, LLC (Custom Air) to activate its site within FTZ 202, Site 32, located at Arrow Way, Rancho Cucamonga, California. Site 32 is a building within acres of FTZ 202 service area. This site is approximately 60 miles northeast of the Port of Los Angeles (Port). Custom Air will be operating its warehouses under the FTZ procedures. The proposed FTZ Operating Agreement (Agreement) will provide a term of five years with three, five-year renewal options. Recommendation: Board resolve to (1) approve the proposed Foreign-Trade Zone Operating Agreement between the City of Los Angeles Harbor Department and Customs Air Warehouse Inc. and Custom Goods, LLC; (2) direct the Board Secretary to transmit the Foreign-Trade Zone Operating Agreement to the Los Angeles City Council for approval pursuant to Section 373 of the Charter of the City of Los Angeles and Section 10.5 of the Los Angeles Administrative Code; (3) upon approval by the City Council, authorize the Executive Director to execute and the Board Secretary to attest to the Foreign-Trade Zone Operating Agreement; and (4) adopt Resolution No RECOMMENDATION APPROVED; RESOLUTION NO ADOPTED; AND AGREEMENT NO ADOPTED AND ITS EXECUTION AUTHORIZED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) Page 4 of 16

5 2. Re: RESOLUTION NO APPROVAL OF FOREIGN-TRADE ZONE GENERAL PURPOSE OPERATING AGREEMENT BETWEEN THE CITY OF LOS ANGELES HARBOR DEPARTMENT AND NNR GLOBAL LOGISTICS USA INC., FTZ 202, SITE 29 SUMMARY: The City of Los Angeles Harbor Department (Harbor Department), as the Foreign-Trade Zone (FTZ) grantee, establishes General Purpose Operating Agreements with FTZ operators to oversee their FTZ operations. The Harbor Department received a request from NNR Global Logistics USA, Inc. (NNR) to activate its site within FTZ 202, Site 29, located at S. Main Street, Carson, California. Site 29 is a warehouse of 1.92 acres. This site is approximately 10 miles north of the Port of Los Angeles (Port). NNR will be operating its warehouse under FTZ procedures. The proposed FTZ Operating Agreement (Agreement) will provide a term of five years with three, five-year renewal options. Recommendation: Board resolve to (1) approve the proposed Foreign-Trade Zone Operating Agreement between the City of Los Angeles Harbor Department and NNR Global Logistics USA, Inc.; (2) direct the Board Secretary to transmit the Foreign-Trade Zone Operating Agreement to the Los Angeles City Council for approval pursuant to Section 373 of the Charter of the City of Los Angeles and Section 10.5 of the Los Angeles Administrative Code; (3) upon approval by the City Council, authorize the Executive Director to execute and the Board Secretary to attest to the Foreign-Trade Zone Operating Agreement; and (4) adopt Resolution No RECOMMENDATION APPROVED; RESOLUTION NO ADOPTED; AND AGREEMENT NO ADOPTED AND ITS EXECUTION AUTHORIZED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) Page 5 of 16

6 Human Resources 3. Re: RESOLUTION NO AGREEMENT BETWEEN THE CITY OF LOS ANGELES HARBOR DEPARTMENT AND EMPATHIA PACIFIC, INC. SUMMARY: The Human Resources Division requests approval of an Agreement with Empathia Pacific, Inc. (Empathia), located in Westlake Village, California, to provide Employee Assistance Program (EAP) services to City of Los Angeles Harbor Department (Harbor Department) employees. On May 8, 2012, First Amendment to Agreement No. E6585 was approved for one year in the amount of $40,000 and expires on June 1, The proposed Agreement would be for a period of three years for an amount not-to-exceed $120,000. The recommendation to select Empathia is based on the Request for Proposals (RFP) performed by the Harbor Department in September Recommendation: Board resolve to (1) find that in accordance with the City Charter Section 1022, the City does not employ personnel with the required expertise nor is it feasible to do so on a temporary or occasional basis; (2) approve the Agreement with Empathia Pacific, Inc. for EAP services in an amount not-to-exceed $120,000 for a total term of three years; (3) authorize the Executive Director to execute and the Board Secretary to attest to the Agreement; and (4) adopt Resolution No RECOMMENDATION APPROVED; RESOLUTION NO ADOPTED; AND AGREEMENT NO ADOPTED AND ITS EXECUTION AUTHORIZED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) Page 6 of 16

7 Planning & Economic Development 4. Re: RESOLUTION NO ISSUANCE OF A LEVEL I COASTAL DEVELOPMENT PERMIT (NO.13-06) TO THE CITY OF LOS ANGELES HARBOR DEPARTMENT FOR THE IMPLEMENTATION OF THE FRONT STREET BEAUTIFICATION PROJECT SUMMARY: The City of Los Angeles Harbor Department (Harbor Department) is proposing to implement the Front Street Beautification Project (Front Street Project), a landscape and street improvement project along the northeast side of Front Street between Pacific Avenue and Swinford Street. The proposed project includes landscaping, a multi-use path, way-finding signage, and widening of Front Street. Staff is recommending the Board of Harbor Commissioners (Board) approve Coastal Development Permit (CDP) No , a Level I, non-appealable permit for the proposed project. Recommendation: Board resolve to (1) find that the proposed project conforms with the Port Master Plan and the California Coastal Act of 1976, as amended, and find that this project will have no significant adverse environmental impacts as provided in the California Environmental Quality Act; (2) authorize the Executive Director to approve the issuance of a Level I non-appealable Coastal Development Permit No , consistent with the project description contained in Application for Discretionary Project No ; and (3) adopt Resolution No RECOMMENDATION APPROVED AND RESOLUTION NO ADOPTED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) Page 7 of 16

8 Port Police 5. Re: RESOLUTION NO COOPERATIVE AGREEMENT BETWEEN THE UNITED STATES DEPARTMENT OF HOMELAND SECURITY, FEDERAL EMERGENCY MANAGEMENT AGENCY AND THE CITY OF LOS ANGELES HARBOR DEPARTMENT FOR REIMBURSEMENT OF PORT SECURITY GRANT PROGRAM FUNDS FOR FISCAL YEAR 2012 SUMMARY: The City of Los Angeles Harbor Department (Harbor Department) is proposing to enter into a Cooperative Agreement with the United States Department of Homeland Security (DHS), Federal Emergency Management Agency (FEMA) for the reimbursement of funds allocated to the Harbor Department under Fiscal Year (FY) 2012 Port Security Grant Program (PSGP). DHS awarded a Federal grant in the amount of $6,900,000, to the Harbor Department on September 1, Items approved for grant reimbursement subsequent to expenditure by the Harbor Department are as follows: Los Angeles Port Police (Port Police) Marine Unit Vessel Replacements ($1,875,000); Security System Integration, Maintenance and Repair ($3,000,000); Port Police Dog Kennel Phase II ($375,000); and Information Technology (IT) Security ($1,650,000). The award is for a two-year period ending August 31, A 25% cost share is required under this PSGP, and will be funded by the Harbor Department. The Department s total cost share for the project is $2,300,000, for a total cost of $9,200,000 for all projects. Recommendation: Board resolve to (1) approve the Cooperative Agreement between the Harbor Department and United States Department of Homeland Security, Federal Emergency Management Agency for reimbursement of funds allocated to the Harbor Department under Fiscal Year 2012 Port Security Grant Program; (2) authorize the Executive Director or designee to execute and the Board Secretary to attest to the proposed Cooperative Agreement for and on behalf of the Board; (3) authorize the Harbor Department to proceed with the four projects approved for funding by the United States Department of Homeland Security, Federal Emergency Management Agency; and (4) adopt Resolution No RECOMMENDATION APPROVED; RESOLUTION NO ADOPTED; AND AGREEMENT NO ADOPTED AND ITS EXECUTION AUTHORIZED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Page 8 of 16

9 5. (Continued) Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) REGULAR ITEMS (6 & 7) Construction 6. Re: RESOLUTION NO PROPOSED RESOLUTION FOR PREQUALIFICATION OF BIDDERS FOR THE CONSTRUCTION OF BERTHS ICTF PROJECT SPECIFICATION NO SUMMARY: The City of Los Angeles Harbor Department (Harbor Department) has committed to the timely delivery of an Intermodal Container Transfer Facility (ICTF) as part of the Berths Trans Pacific Container Service (TraPac) expansion program. Staff recommends that construction of the Berths ICTF Project, be performed by prequalified contractors to ensure timely completion of the project. Section 375 of the Los Angeles City Charter allows prequalification of bidders for construction contracts if the Board of Harbor Commissioners (Board) finds that utilization of such a process would benefit the City of Los Angeles (City). This Board Report sets forth characteristics of the proposed project and the justification for utilizing the prequalification process to attain benefits for the City. The estimated construction cost is $75 million. The Project is state funded under the Proposition 1B Trade Corridor Improvement Fund (TCIF) up to $20.7 million. Recommendation: Board resolve to (1) approve the Resolution for Prequalification of Bidders, finding that utilization of the bidder prequalification process for construction of the Berths ICTF project would benefit the City of Los Angeles, pursuant to Section 375 of the Los Angeles City Charter and Section of the Los Angeles City Administrative Code, for the Project; and (2) adopt Resolution No RECOMMENDATION APPROVED AND RESOLUTION NO ADOPTED Page 9 of 16

10 6. (Continued) Motion by Commissioner Robin M. Kramer, seconded by Commissioner Douglas P. Krause, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) James Davis, Construction Division, and Christina Sar, Engineering Division, provided a power point presentation on Item No. 6. Contracts & Purchasing 7. Re: RESOLUTION NO AGREEMENT BETWEEN THE CITY OF LOS ANGELES HARBOR DEPARTMENT AND MERRIWETHER & WILLIAMS INSURANCE SERVICES AND MEMORANDUM OF UNDERSTANDING AMONG THE CITY OF LOS ANGELES HARBOR DEPARTMENT AND THE OFFICE OF THE CITY ADMINISTRATIVE OFFICER, THE LOS ANGELES WORLD AIRPORTS, AND THE DEPARTMENT OF WATER AND POWER FOR THE CITYWIDE BOND ASSISTANCE PROGRAM SUMMARY: The Contracts and Purchasing Division (CPD) is requesting approval to award an Agreement to Merriwether & Williams Insurance Services (Los Angeles, CA), and enter into a Memorandum of Understanding (MOU) among the City of Los Angeles Harbor Department (Harbor Department) and the Office of the City Administrative Officer (CAO), the Los Angeles World Airports (LAWA), and the Department of Water and Power (DWP) for the Citywide Bond Assistance Program. The proposed agreement is for a three-year term at an amount not-toexceed $717,505. Recommendation: Board resolve to (1) find that in accordance with the City Charter Section 1022, City employees do not have the expertise to perform the work covered under this Agreement; (2) approve the Agreement with Merriwether & Williams Insurance Services at an amount not-to-exceed $715,505 for a term of three years; (3) approve the Memorandum of Understanding among the City of Los Angeles Harbor Department, the Office of the City Administrative Officer, the Page 10 of 16

11 7. (Continued) Los Angeles World Airports, and the Department of Water and Power;(4) authorize the Executive Director or designee to execute the Agreement and the Memorandum of Understanding and the Board Secretary to attest to the Agreement; and (5) adopt Resolution No RECOMMENDATION APPROVED; RESOLUTION NO ADOPTED; AND AGREEMENT NO ADOPTED AND ITS EXECUTION AUTHORIZED Motion by Commissioner Douglas P. Krause, seconded by Vice President David Arian, and carried the following vote: Ayes: Noes: President Cindy Miscikowski, Vice President David Arian, Commissioner Robin M. Kramer, Commissioner Douglas P. Krause, and Commissioner Sung Won Son. (5) The following persons provided public comment on Item No. 7: Bob Harris, Granitex Construction Company Ingrid Merriwether, Merriwether & Williams Insurance Services Page 11 of 16

12 I. CLOSED SESSION: 11:40 A.M. 12:23 P.M. 1. CONFERENCE WITH LEGAL COUNSEL ANTICIPATED LITIGATION (Subdivision (d)(2) of Government Code Section ) Significant exposure to litigation pursuant to subdivision (d)(2) of Section (one case) 2. CONFERENCE WITH LEGAL COUNSEL EXISTING LITIGATION (Subdivision (d)(1) of Government Code Section ) American Trucking Associations, Inc. v. City of Los Angeles, et al., United States District Court Case No CAS, and United States Court of Appeals for the Ninth Circuit Case No CONFERENCE WITH LEGAL COUNSEL ANTICIPATED LITIGATION (Subdivision (d)(2) of Government Code Section ) Significant exposure to litigation pursuant to subdivision (d)(2) of Section (five cases). The following parties have filed five separate appeals to the Los Angeles City Council regarding the decision by the Board of Harbor Commissioners to certify the Southern California International Gateway Project (SCIG Project) Final Environmental Impact Report and approve the SCIG project, LAHD ADP No , SCH No Appellant: City of Long Beach Appellant: Coalition for a Safe Environment Appellant: Fast Lane Transportation, Inc. Appellant: Long Beach Unified School District Appellants: Natural Resources Defense Council, Coalition for Clean Air, East Yard Communities for Environmental Justice Page 12 of 16

13 I. (Continued) 4. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section ) Provide instructions to its real estate negotiators with respect to Permit 634 granted to Equilon Enterprises, dba Shell Oil: Property: Berths City Negotiator: Tenant Negotiator: Negotiating Parties: Under Negotiation: Michael Galvin Bob Dicks City and Equilon Enterprises, dba Shell Oil Price and Terms 5. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section ) Provide instructions to its real estate negotiators with respect to Permits 712 and 713 granted to Shore Terminals, LLC (Nustar): Property: Berth 163 City Negotiator: Tenant Negotiator: Negotiating Parties: Under Negotiation: Michael Galvin Chad Edinger City and Shore Terminals, LLC (Nustar) Price and Terms Page 13 of 16

14 I. (Continued) 6. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section ) Provide instructions to its real estate negotiators with respect to Permit 306 granted to Ultramar, Inc. (Valero): Property: Berth 164 City Negotiator: Tenant Negotiator: Negotiating Parties: Under Negotiation: Michael Galvin Steve Faichney City and Ultramar, Inc. (Valero) Price and Terms 7. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section ) Provide instructions to its real estate negotiators with respect to Revocable Permit granted to Phillips 66 Company: Property: Berths City Negotiator: Tenant Negotiator: Negotiating Parties: Under Negotiation: Michael Galvin David Ching City and Phillips 66 Company Price and Terms Page 14 of 16

15 I. (Continued) 8. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section ) Provide instructions to its real estate negotiators with respect to Permit 560 granted to Vopak Terminals North America, Inc.: Property: Berths City Negotiator: Tenant Negotiator: Negotiating Parties: Under Negotiation: Michael Galvin Mike LaCavera City and Vopak Terminals North America, Inc. Price and Terms 9. CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section ) Provide instructions to its real estate negotiators with respect to Permit 704 granted to ExxonMobil Pipeline Company: Property: Berths City Negotiator: Tenant Negotiator: Negotiating Parties: Under Negotiation: Michael Galvin Dennis Courtney City and ExxonMobil Pipeline Company Price and Terms Page 15 of 16

16 Report of the General Counsel General Counsel Janna Sidley reported that during the Closed Session, the Board considered the items on the Closed Session agenda, but took no reportable action. THERE BEING NO FURTHER BUSINESS, AT APPROXIMATELY 12:25 P.M. PRESIDENT CINDY MISCIKOWSKI ADJOURNED THE REGULAR MEETING OF THE BOARD OF HARBOR COMMISSIONERS APRIL 18, President APPROVED BY THE LOS ANGELES BOARD OF HARBOR COMMISSIONERS AT ITS MEETING HELD ON MAY 2, Secretary Page 16 of 16