flow with city government. can you go back in history as to when this had been attempted before and might have been put on pause before? >> before this contract, wraparound advertising was allowed, a certain number of them were. so, it has always been allowed, but it was something that we've been prohibited on the current contract. this goes back to the pre- existing situation. supervisor mirkarimi: when did that happen? >> just this year. supervisor mirkarimi: this is not first time the wraparound has come before the government's. so, the debate this some years old. please, trail backwards a bit, logically. not about the contractor, but

the advertising discussion. >> in general? it was allowed before this. the people in the public have had certain objections, but it was always allowed. i am not certain howard would have manifested prior to current contract. supervisor mirkarimi: you say that it was allowed before, was it in limits because it was not well executed or something that we saw? we understand that this proposal is a 5% threshold. is that the same as before? >> i think so. i did not manage the contract at the time, but it was limited in similar. host: prior to now it was always 5%? >> i believe so.

supervisor avalos: how many vehicles that represent? 57 -- >> 57 out of the 993. this is not allowed on historic vehicles and cable cars, that does not change. supervisor mirkarimi: if the vehicle with wraparound is disabled, is the wraparound also stuck static? because we have this problem with repair in muni and equipment being offline. as the advertising easily transferred to another operating vehicle?

>> i do not know it has ever come up but they would have the entitlement to any number of vehicles on the street. supervisor avalos: mr. ross, be sure your report. >> members of the committee, mr. chairman, as pointed out on page 3 where using guarantee gross revenues, whichever is higher. and then there is an adjustment on the 5% minimum annual guarantee on table two that they have rejected the pay $448,000, about $148,000 more than the

menu will guarantee. -- minimal guarantee. page seven of the report, i will go right to the recommendation, that you continue the resolution to the call of the chair to allow for time for an increase in the annual minimum guaranteed amount for an additional $500,000 each year. incorporating the estimated increase under the amendment in the annual minimal guarantee amount should be subject? the increase in the amount of

the parent -- fail guarantee would have a violence of wrapped up advertising on 5%, including fully covering the vehicles windows. outdoors states that while we have seen a slight improvement, the advertising market of 2009 will continue to be concerned on the overall climate. and increased the annual minimum guaranteed would be inappropriate at this time. mr. chairman, members of the committee, when we first discussed this resolution with mta, authorizing advertising to

fully cover transit vehicles, there was an emphasis that this would be a good deal for the city. from the contractor, we agree that it would be a good deal for the city. when the draft report was subsequently submitted, with an inclusion in the minimal guarantee payment made, all of a sudden tighten outdoor backed off by saying that it is uncertain as to whether they would realize an additional

$500,000. i submit that they cannot have it both ways. either they are representing to you that the sf mta will receive an additional $500,000 annually or they will not. we strongly believe that if you approve the request to authorize advertising revenues, fully covering vehicle windows, in consideration for that advertising does there should be some increased guarantee compensation for the city. mr. ford wrote to you, to the board of supervisors. this is what he said, generating

approximately 500 annually in total through 2012. in the operating budget. either they will pay it or they will not, and if they are we think it is only reasonable for the board to make sure there is increased revenue in this amount. supervisor avalos: thank you. supervisor mirkarimi: mr. rose, i think you have earned your advertising today. i agree in your policy recommendation. concerns are outstanding about

the lack of guarantees, so if we are going to engage in a contract that we are supposed to deliver a certain sum of, that has now been made dubious. i think that it is a wise decision to continue this until we have a more precise agreement. supervisor avalos: thank you. that would be especially if we change the type of advertising to cover the buses' windows, something that previously the supervisors had been uncomfortable with. can we open this up for public comment? number five? seeing no one, we will closed public comment. supervisor mirkarimi: motion to

continue. it says august, but i would say motion to continue at the call of the chair. supervisor avalos: taken without objection. madam clerk, please call items #6 and 7. >> item #6, resolution approving the amended and restated service agreement and property use license for towing, storage and disposal of abandoned and illegally parked vehicles by and between the san francisco municipal transportation agency and tegsco, llc, d.b.a. san francisco auto return. item number 7, resolution approving the memorandum of understanding with the metropolitan transportation commission, and other bay area transit agencies, for the future operation and maintenance of the clipper program. supervisor avalos: very good. presentation on item number six.

>> good morning. the mta is responsible for removing illegally parked vehicles through contract in a storage management services. the san francisco police department also uses the services provided to toe the vehicles of unlicensed and intoxicated drivers with vehicles involved in criminal activities. the current five-year agreement is due to expire on july 31, 2010, obtaining the option to extend an additional five years to july 31, 2015. we believe that the extension is in the best interest of the city and public for various reasons. the decline in volume has been

significant, down 13% in the last year. although return has proven to be an excellent operator, making significant improvements to the towing operation compared to the previous city tow operator. they have produced complaints from 20 per month to 1 per quarter, making significant improvements to property. the mta is planning to cut out an rflp in january of 2013. i am here to answer any questions you might have. supervisor avalos: before questions, let's hear from mr. rose on this item. >> has pointed out on page 6 of

the report, effective july 1, 2010, they anticipate annual revenues of 9.4 million during the next five years, which is about $736,000, 8.5% more than what they are currently getting. on the bottom of page 7 of the report, although they typically recommends city departments to conduct procedures to select contractors, m.t.a. decided not to issue a removal agreement because with the decline in volume and economic recession, we believe that issuing a new i s p. would not result in favorable percentages for the existing agreement. we stayed on page 8 that because the existing agreement as

previously approved contained an option to extend the agreement, the existing agreement with a fire in two weeks -- would expire in two weeks. this one is key, a new vendor will have to pay auto-return for build up costs. for all of those reasons, we recommend that you approve this proposed agreement. supervisor avalos: thank you, mr. rose. i have one question. it is about the current contract that expires shortly, it calls for 1 extension. >> it is our intention to issue a new r f p for a contractor in

2014. supervisor avalos: for this unspecified length of time, how did you determine that it would be a five-year contract? >> just the probability that the volume might increase over the next five years, allowing auto- return a duration of time to cover improvement costs. supervisor avalos: future amendments would not be allowed? >> we do not foresee any. supervisor mirkarimi: there has been a 19% decrease over the last six years, therefore revenue is also the creasing on the part of us keeping up with the population.

given the price, it is analogous to one week's salary. is it also because of other telling companies? or renegade telling companies that are able to hijack our business? >> that is not the case. they are directly related to the totals referred to by the mta. supervisor mirkarimi: do you have any data for cars that go unclaimed? [inaudible] any idea what the population looks like? >> we have much data regarding that issue.

the current volume of abandoned vehicles is about 10,000 annually. supervisor mirkarimi: how is that on par from year-to-year? [inaudible] cannot afford to get their car. >> it has affected the number of vehicles retrieved, but i do not know the particular statistic. i could get that for you. supervisor mirkarimi: it would be interesting. if you could give us the five- year, or back to 2002. >> excuse me. supervisor mirkarimi: ok. supervisor avalos: perhaps even

talk about differences with the current contractor for auto- storage in the past. from the perspective of the mta . >> i know that there were specific issues related to vehicles being stolen, personal property. what i can tell you is that they really do what the talk. they are really very responsible. their executive team is available the time, using the best practices currently.

>> on the bottom of page three, according to the department customer complaints have decrease from 20 per month under the previous contractor to an average of less than 1 per quarter for three months under the existing agreements. that auto return received a favorable review during a compliance order conducted by the controller's office in march of 2007. supervisor avalos: ok. i guess i'm -- that's good to know. i'm just wondering, anyone who has their car towed is going to complain, but i guess making a complaint is a much higher threshold -- >> i think that given the nature of the business, one complaint per quarter is very extraordinary. supervisor avalos: if i had my car towed a few times in san francisco, i have the experience of city tow and auto return.

it is kind of night and day. i felt criminalized under city tow and mildly criminalized under auto return. >> auto return has significant improvements in terms of their customer service center, their dispatch center and within the contract itself, we took the opportunity to really clean up the current operation needs response times and things of that nature so the contract is very good. supervisor avalos: very good. let's have public comment separately on this, on auto return. seeing no one coming forward, we'll close public comment on auto return motion by spfers elsbernd, take is with no rejection. madam clerk, if you can call item number seven.

>> item number seven, resolution approving the memorandum of understanding with the metropolitan transportation commission and other bay area transit agencies for the future operation and maintenance of the clipper program. >> good afternoon, chair avalos, members of the board. diane hammonds, sfmta finance. this is a memorandum of understanding between the transportation commission and the southern current participating era transit agencies in the clipper program. clipper as you are aware now is the new name for the trans link program which is a regional fair media program that is designed to create a consistent and a streamlined method of fair payment across all of the agencies. supervisor avalos: how did we get the name clipper? >> clipper was developed by the

m.t.c. staff and the reason for the change in the name at this time was really to have a name that distinguished itself from other programs such as fast track, our own fast pass, fair media, and to have something that was more specific to the bay area. trans link is actually a more of a brand rather than a specific program in the bay area. and, again, the m.o.u. today that is before you is intended to replace the interagency partnership agreement which has been in effect since 2003. it represents a governance model that moves from implementation to design to ongoing operations in terms of the cost and revenue sharing allocation, the formula established in the i.p.a. have been carried over in this existing m.o.u. we have identified a cost savings associated with the transition of our fair media to

the clipper program, and the costs above that are currently budgeted in our f.y. 2011-2012. i would be happy to answer any questions. supervisor avalos: thank you, ms. hammonds. >> mr. chairman, members of the committee, on page 4 of our report, as shown in table 1, that under this proposed m.o.u., sfmta's share of the operating maintenance costs would total $43.8 million that is fiscal years 2010-2011 through fiscal year 2018-2019. there is a table on page 5 where the sfmta estimates savings that will be generated such as a reduction in fraud and other items which are explained in our report of about $17 million, so that the

net estimated cost under this m.o.u. to the sfmta for fiscal years 2010-2011 through 2018-2019 is $26.6 million. finally on page 6 of our report we state -- as you know, this program is totally operated by the n.t.c. it has approved a resolution that specifies sanctions including the ineligibility for federal and state grant monies that are dispersed by the n.t.c. to the sfmt in the event that this and other partner is jurisdictions did not enter into the proposed m.o.u. it states, "the sanction of withholding, restricting or reprogramming funds to enforce cooperation will be exercised by n.t.c. to ensure that all transit operators fully participate in the implementation of the clipper

program. ms. hammonds advises that the monies are dispersed to the s.f.m.t.a. to the n.p.c. this approval of the m.o.u. could result in the s.f.m.t.a. being ineligible for future grant monies. we recommend that you approve this resolution. supervisor avalos: thank you, mr. rose. colleagues, any questions? let's go into public comment. any member of the public like to comment on item number 7? seeing no one coming forward, we'll close public comment. motion to approve from supervisor mirkarimi and it passes without objection and move to the full board with recommendation. madam clerk, do we have any other items related to our subcommittee. >>, mr. chairman.

supervisor avalos: we are adjourned and come back as the full committee around 1:30, 1:35.