At their last meeting of 2006, San Francisco's Board of Supervisors gave preliminary approval Tuesday to one of the grandest development plans in city history, the remaking of the former naval base at Treasure and Yerba Buena islands into a brand new community.

The 10-1 vote allows the city and a development partnership to finalize a binding contract for the project -- pending now for more than a decade -- and should speed transfer of the land from the U.S. Navy.

Under the terms authorized by supervisors, 6,000 homes would be created through private and public financing. Development partners Wilson Meany Sullivan, Lennar Corp. and Kenwood Investments will stake $500 million with the city providing an additional $700 million in bond money financed by property taxes collected once the development is completed. The initial $1.2 billion will pay for the project's infrastructure and some of the proposed housing.

Michael Cohen, Mayor Gavin Newsom's chief aide in charge of redevelopment of military bases, said the development will include the creation of the largest city park since Golden Gate Park was built, a collection of hotels and shops clustered around a new ferry terminal and 1,800 affordable housing units.

The overall plan, Cohen asserted, will "make Treasure Island one of the great destination spots in the world."

But much of the project remains a hopeful experiment with questions about transportation to and from the island, the possible drain on city services by a new neighborhood in the bay and seismic safety still in doubt.

Amendments approved by supervisors on Tuesday mandate board approval of any expenditure of city money for the benefit of the new community.

"We're the ones with the fiduciary responsibility," said Supervisor Jake McGoldrick. "We're the ones with the budget oversight duty."

An amendment offered by Supervisor Chris Daly, whose district includes the project site, would provide rent control protections to the approximately 2,000 residents already living on the island.

The only "no" vote to the project on Tuesday came from the city's newest supervisor, Ed Jew, who voiced concern that the development does not guarantee enough jobs for city residents.

The terms of the project state that 50 percent of the construction and related jobs should be reserved for San Franciscans. Jew said he wanted that percentage to be raised to 75 percent but he did not offer an amendment to implement that change.

Overall completion of the development is scheduled for 2022, with new residents expected to begin moving in by 2013.