>> good morning, everyone. welcome to the budget town hall for the san francisco transportation agency.

i am the communications manager for the sfmta. i want to welcome you on behalf of the agency and my colleagues. the way the format will work today is that i am going to give a short overview of the budget for the next two fiscal years and a little bit about this fiscal year. we will be collecting comment cards. if you do not have one, raise your hand. we will call about 5 at a time. we will answer any questions raised during that time. my colleague is the timer for today. please keep your comments to about three minutes. that would be great. that way everyone has a chance to talk. we're very glad to have you here. please get the lights.

what is the process for the budget for 2011 and 2012? under the san francisco charter, the city and county of san francisco is covered by a charter like the constitution. we are required to pass a two your budget. the fiscal year runs from july to june. we have to have the budget passed by may 1. we've been working on the deficit for those two years. the most recent estimates show that because of the economic downturn that continues to affect our revenues, we're facing a little more than a 500 million deficit. it is $56.4 million in the first year. those are not cumulative.

ongoing revenue increases and expenditure reductions are on going into the second year as well. on february 26, the board of directors took action on the current year budget. we found halfway through this year that we continue to have a deficit for the current year. the board took action to address the current deficit and get a headstart on the two-year budget. $14 million worth of actions were taken. another 41 million where the factions were started in november. -- another $14 million of actions were started in november. discount passes will be raised to $30. the board of directors did not move forward on that item. they did move forward on the 10% service reduction for the me system as well as other items.

some uncertainty remains in the current year budget. we watcare watching it closely. there are revenue items budgeted that we are watching closely. we're expecting $11.2 million from the taxi medallion program. we're still working on that. it is not a done deal yet. there are $5 million in overtime reductions that we began in order to address the deficit. that does mean a reduction in service for muni. i want to emphasize that the single biggest contributor factor to the deficit has been the loss of state transit assistance revenues, operating funds from the state of california. that is because of the nightmare in sacramento for the budget. over the last three years, we've lost $179.1 million.

if we were getting the revenue the voters have approved from the state, we would be getting $78.3 million next year. that is more than our deficit. many of you may have read and followed some of the measures passed by the state legislature that would direct $400 million statewide immediately to transit. the sfmta share of that would be about $36 million. it would also enact a complicated gas tax scheme that would begin to give us ongoing revenue sources again in the second year of the budget. last week, the governor sent a letter to the state pro tem saying he did not like various portions of it and was planning to veto it. he has not vetoed it yet. he has until this monday to make

a decision. the legislature is taking some actions to address some of his concerns and other areas. we're not counting on that revenue but we're working to advocate for it. we've been sending letters. the mayor has been working on it. the board of supervisors unanimously passed a resolution urging passage of the bills. monday it will be a big day. it will either be a day of serious disappointment or a glimmer of hope from sacramento. i wanted to update everyone on that item. i would be happy to answer questions about it. i wanted to show you a few charts that give an overall idea of the budget. this is for the current fiscal year. in addition idea of where the revenues come from and where the expenditures go. -- it will give you an idea of where the revenue comes from and where the expenditures go. the voters have repeatedly

dedicated parking-related revenues to transit. that is why it is the biggest part of our budget. it includes parking meter revenues, finds, taxes, and other items related to parking. fares are a big part of our revenue stream. it is surprising to many people that the only cover about 20% of the total revenue required to run the muni system. that means every trip is heavily subsidized by other sources. we do get significant funding from the general fund under the charter. we get a number of grants. we had been using reserve balance of $41 million. next year, that will no longer be available. on expenditures, the biggest piece of the pie is salaries and benefits for employees. that is how it should be. we are a service-oriented

organization. we provide services. it takes a lot of men and women working hard to provide that service. that is the biggest piece of the expenditure pie. we also have numerous contracts for vehicles, insurance claims, and services from other city departments. those are called reporters. if the department -- those are called work orders. if a dartmoutdepartment providee service, the invoice us for it. we can discuss that more. that is the expenditure slide. the next one is a reiteration of oil was talking about on state funding. these bars are positive. they go up. this means that we've lost hundreds of millions of dollars over the past few years.

it is hard to continue to provide a consistent level of service when you have this kind of revenue loss. it is not just the state. when the bottom fell out of the economy in the fall of 2008, we saw a significant drop in local tax revenues. that means the amount we get from the city has gone down. we're not expecting it to go down quite as much next year. it is still down from previous levels. that is a big impact on us as well. the revenues for the next couple of years we are seeing numbers that depict the total budget and the different revenues and what is changing in the next few years. the first two columns are the amended budget of last spring of 2009. we closed with a deficit because

of the economy. the first number represents the budget items in that year. then we have what we're projecting for the end of the year based on the things i have talked about that happened over the fiscal year so far. revenues are down. we have some increases in operating grants because we have been able to direct stimulus funding towards operating expenses. those are one time revenue sources. they cannot continue in years ahead. when the economy is down, there is less parking meter revenue. there are fewer citations. there is less parking tax. we've had a decline in debt. we're expecting a little bit of an increase this year. we've raised it by $2.

taxi services, the medallion pilot program. we can talk more about that if your comments or questions. we do get a nice amount of money from advertising revenue. that is something the agency has worked hard on in the last few years. about two years ago, the agency embarked on a contract with clear channel outdoor to replace all of the shelters around the city. that is revenue for us. we get the shelters replaced. we get annual revenue. we're getting about $15 million a year compared to about $500,000 per year under the previous contract. you will see more of the new shelters around the city. about 20 are being moved and replaced. now. eventually, all 1100 will be replaced. the general fund transfer has been down. that is affecting us. the fund balance is a floating amount of money that we're able to have against a rainy day or used to deal with unforeseen

expenses. this year, we're having to use all that. for the next two years, that $40 million is not available to us to address the deficit. this year, we're expecting to beat at about seven under $60 million. we're only anticipating $700 million for next year. that is a big drop. -- we are expecting to be at $760 million. i want to highlight that the bottom line, the impact of the decisions to address this year's deficit to make a difference for next year. everything we have done to reduce positions and other revenues will have an impact on next year to reduce the deficit. on the expenditure side, we have

salaries and benefits. we have the amended budget from last spring and what we're projecting by the end of the year and for the next two years. we do see a bit of a decrease on salaries and benefits based on the position reductions. we have eliminated hundreds of positions. we're going through painful layoffs right now. many people have gotten pink slips. many employees have been laid off or are in the process of being laid off. with the many service reduction, there's no way to save money unless you reduce the number of operators and staff that provide the service. the process is going on right now. on contracts and services, that is not changing a great deal. the reporters are staying about the same.

there are not read the work orders are staying about the same. -- the work orders are staying about the same. we're looking at a reduction in expenditures for next year. i want to highlight a few of the changes. we did address the schedule and the december 5 service changes. many operators are paid it the average --muni operators are paid an average of salaries across the country. that would require the agency to pay about $9 million in additional wages to the operators beginning july 1. we continue to budget for labor concessions. this is part of the citywide in this stations. can see the reduction in terms of salaries and benefits

including the layoffs. we continue to have a big discussion across the country with regards to health care. we continue to see strong increases -- sharp increases in health care costs. that is a big part of our expenses as well. we did go to our contractors and vendors and ask them to reduce their payments to us. we're getting a lot of cooperation. that will save us $4 million. we're trying to put money back into materials and supplies. there's no sense in sending a bus into service if it is going to break down on the streets. that inconveniences' everyone even more. we've seen the parts and supplies inventory cut to the bone. we need to invest in that next year to have reliable service on the streets. those of the main items i want

to highlight. transit will have operating costs. we do expect to save money in the long run with them. the service reductions of 10% will take effect on may 1. and mentioned this at the beginning. $56.4 in deficits for the coming year and $45 million for the year after that. we have to have a conversation at the mta and city hall with all of our stakeholders, customers, and everyone in the community who has a stake in our transportation system. they have to be part of the discussion over the next six weeks. it is not going to be easy. we know that. everyone knows that at this point. we have to be creative and try to find solutions that are out

there to start to address the deficit. i am quickly going to go through some of the ideas. will work to address questions and comments. we will have up to% reduction in work orders either by negotiating what we pay or by not contracting for those services. the city has been based programs -- de-based programs. we have to make sure that our fees keep track of the expenses. we try to reduce expenses by raising the fees. we do anticipate doing that. on extended parking meter hours, discussion has been going on since october when the study was unveiled with the possibility of extending them for the evenings and weekends. there is a lot of discussion

around this. many residents and advocates are. as debating and the ongoing discussion. we put it on the table for discussion. there seems to be more consensus around sunday parking meters. some merchants have requested it. it is not clear what is different about sunday from saturday. that proposal on sunday would generate $2.8 million in revenue. there are about 25,000 meter parking spaces in the city and county. we have been looking at locations that have time limits but not readers. we may add meters to those locations to generate revenue. our thought is that about 1000

would be a corporate. these are in business and commercial areas. this is not in residential areas. we would have to come out with specific proposals on how this would be handled. we are moving to eliminate free parking for city employees and contract of employees. it is a painful process for a lot of folks. it is a policy move as well as the budget move. i think people understand the equity issues. if anyone is going to have free parking, everyone should have it. a lot of these are parking related. there is a planning code ordnance that says in the downtown area called c3, city owned and managed grosz's -- garages should not offer special

rates. if we eliminate the specials, that would generate revenue. if expanded citywide, that would generate close to $6 million total. the taxi item is very small. we have a advertising contracts -- we have advertising contracts for the vehicles. we disallowed window wraps in the last contract. if we move forward with that, that would generate $1 million per year. we know this is a tough item. we want to make sure that people can see out. this is about safety. this is a potential revenue idea as well. automatic indexing is related to fares. we have seen significant jumps in fares when the budget is

impacted. one idea that has been approved by the board in concept would be to index them up to inflation and raise them by a smaller amount like 10 cents or $2 for fast passes. it would go up with inflation and not see as big of jumps. consolidation is another controversial item. one of the keys to getting more out of the service is to reduce travel time delays overall. that is not just about bus stop consolidation. we're looking at where buses are slowed down in traffic. there may be some places in the system where the bus stops are so close together that makes the trip takes longer.

we're studying that right now. there is no specific proposal on bus stops to be consolidated. we're committed to working with all stakeholders to ensure access to the system. we do anticipate that could save some money in the budget. then we get to the big picture items. a lot of the items are a couple of million dollars here and there. that definitely matters. every solution moves us closer to addressing our deficit. there also has to be a conversation that we've started about a big picture items like ballot measures that would generate ongoing revenue streams of millions of dollars to address long-term deficit issues. i will not get into a lot of details on these. there will be discussion on the

next six weeks. the mta board has some power to put things directly on the ballot. then it all need to be approved by the voters. in some cases 2/3 or a simple majority. it may include increasing the sales tax. the vehicle license fees is one we cannot get the state of california to give san francisco the right to raise it on its own. i think everyone remembers the recall campaign with the governor smashing cars. that was about the vehicle license fees. it might make sense in san francisco to increase revenue by increasing the vehicle license fees. we do not have the power to do that right now on our own. that might end up being on the ballot already. parcel tax is another idea. off street parking, right now

there is a 25% tax on all street parking lots. there is the idea to raise that to 35%. that could generate 20 lawyers million for the agency. the hotel tax raised by 1% would generate $15 million. this is the last mta sponsored town hall. however that some supervisors might sponsor town halls in the coming months. -- i have heard that some supervisors might sponsor town halls in the coming months. the mta board meeting on march 30 could declare an emergency that could have an impact that would fulfil certain environmental review requirements. the continued public hearing on potential fine and fee changes for the budget. there are at two regular

meetings scheduled for april. the budget could be adopted in either of those. issues and not adopted early based on past experience. today is the last mta sponsored town hall. we will do everything we can to keep the budget information updated on the website. you can also call 311 to get updates on the budget. that concludes my presentation. i know it was a lot of information very quickly. we will call out about five names. people will come up and make their comments. i will work to address any questions raised or sable get back to you on questions raised. thank you very much. i will get the first set of cards right now. we will get the lights back on. thank you.

the first group includes david hardy, eli young, frank fay, and herbert weiner, and elica edimad. you have three minutes. mr. siegel has a time indicator. please respect the time and wrap up in about three minutes. >> my name is david hardy. i have a question. i wonder if it would work to consolidate some of the bus lines. with its save any money to consolidate some of the bus lines -- what its save any money

to consolidate some of the bus lines? a short line could be combined with one of the general lines. can you give an example? >> dvd 17 line could be combined with a 2the 29 or 18 lines. i do not know if this would save money. i have seen several times when there has only been one train on the m ocean view line when two were clearly needed. i am sure there are plenty of times when they of had the cars available. you do not have to have a driver on the second car.

i am wondering if something can be done about this, having more double trains. that is it. >> good morning. i am talking about -- i want to talk about some concerns that i personally experienced with the muni. i have been living in the city and have been a faithful muni rider for the past 20 years. my great concern is regarding

muni bus route 66. it affects me personally about my job, my livelihood. for the past 20 years, i have been living alone and depending on muni for my job.