is the performance of the online and front line troops. in this particular case you have an individual in our rail -- and our rail operators are challenged to be alert in two different ways. one set of rules and auto train control in the subway and yet another set of challenges while they operate on the service. both require constant vigilance and alertness. in this particular case through the actions of mr. rivera, who by the way may have been named after a philosopher and mathematician but his decisive action in this particular case belies that namesake. essay allowed us to call him archy. his act in this -- call him archie. his act in this particular case causing -- not allowing injury to this particular patron really reflects the best of the

performance of our agency. so it's a pleasure and -- for us to recognize him. [applause] mr. rivera. >> all i can say thank the lord for guiding and protecting us during our work and in doing our work. i just say hello to my family, my wife, lydia, my sons, lawrence, and roberto, who is working with -- and just to say thank you to each and every one of you for giving me this recognition award. i hope that all of our employees there working do their best to be safe there out there. thank you. chairman nolan: thank you, mr.

rivera. on behalf of the board of directors, do thank you for your outstanding work. [applause] >> our next award goes to melanie martin. melanie, could you please step up to the podium? melody is also a transit operator at our green division and has been with the agency for over 11 years. she's receiving this award today for her courageous actions of saving someone from harm or possibly saving their lives. on june 21, melody witnessed a man fall into the tracks at the train station at civic center station while she was pulling in. she worked very quickly and safely to stop her train and avoided any contact or harm to that person. her keen awareness, observation of her surroundings and her skills as a train operator was invaluable to this incident. i'd like for john also present the award of appreciation to

melody. john. >> thank you, mr. ford. once again, truly extraordinary performance, and i learned earlier today that actually this is somewhat routine for melanie because prior -- even prior to joining the agency she had been involved in helping someone who was down in the subway tracks be brought out safely. so we're pleased to have her use that effort to come onboard and continue her outstanding performance. so congratulations, melody, to you. [applause] >> i'd like to thank the board for this recognition. >> thank you for your stout standing work. thank you, ms. martin. chairman nolan: congratulations. director ford: our next award is a group award and will be presented to christine kayaya

and sheroline. i apologize for that challenging name description there. sorry, folks. working as a team, both christine and sheroline is part of our employee and labor relations section and are being recognized with their steadfast, dedication and the success of m.t.a.'s partnership with the public employees committee during the concession discussions and negotiations. it was christine and sheroline's laborists efforts that would have red line versions of documents and letters of agreement ready with little to no advance leave time when a concession meeting needed to happen. the dynamic duo took the lead in collecting all contract data working with the city's attorney's office to get the memoranda of understanding approved as to legal form and

as well as coordinating with the m.t.a.'s webmaster to make sure these documents were accessible to the public. and these include our low-vision individuals during the sunshine period. the cost savings that the m.t.a. achieved as a result of these discussions may not have materialized without their support. christine has been with the agency for four years and she is a hardworking and dedicated employee who takes pride in and is a team player who is always willing to mentor and assist others and is willing to learn new things. sheroline has been with the agency for two years. she's the ultimate team player who assists her colleagues without hesitation. her technical skills are part of her attitude. both are tremendous assets to their division, their agency and the city as a whole due to their unrelenting commitment to those they serve. debra is here to present the

award to christine and sheroline. good afternoon. >> good afternoon. thank you, mr. ford, members of the board. it's with us team pleasure that i stand before you today and recognize these two employees. as you all know for the past several months i've been coming before you, briefing you about our discussions and our partnering with labor. and none of this would have been possible without the commitment, without the support of employee and labor relations and these two individuals. i would be remiss if we did not come before you and acknowledge their hard work during these troubling times and we had to make such difficult decisions with less. so with that it gives me extreme pleasure to stand before you and present these awards. if i may just really quickly, one is with christine and the other one is sherline that says in appreciation of your dedication to improving the quality of lives for the employees of the municipal transportation agency and the residents of san francisco by the san francisco municipal

transportation agency given this day, august 3, 2010. so congratulations. and congratulations. thank you so much. >> i would like to thank the board for acknowledging our efforts. we would not have done this without the support. >> it's been a pleasure to work with this team. they are great team players. it just makes it a lot easier when we all work together. chairman nolan: i want to say thanks on behalf of the board of directors and their work on behalf of all of us. thank you so much. [applause] director ford: ok. on july 29 of this year, the mayor hosted the signing of the city's fiscal year 2010 and 2011 annual budget. and despite the many challenges that face city departments,

boards and commissions as well as our political leaders during the budget process we were able to compromise and work together as a team to balance the city's budget. on that note i would like for our chief financial officer to come now and present to you and update the modifications that were made to the m.t.a.'s fiscal year 2010 and 2011 budget as well as the 2011 and 2012 budgets post your approval of the m.t.a. budget earlier this year. so here are the adjustments that needed to be made. >> good afternoon. members of the board crrks c.f.o.

at the end of april you adopted an operating budget. total of that time was $749.5 million for 2011 and $768.8 million in 2012. since then we have had revisions to various line items. so the 2010 budget has now been increased by $25.5 million and the 2012 budget by $11.8 million. and the details of the revenue increases are as follows -- so on the operating grant side we've increased our operating grants by $15.6 million, $7 million from the prop a allocation, $7 million from the m.t.t., and $1.6 million from a new grant for the lifeline -- from lifeline that we just recently received. so the moneys, as you know, was

split into two pieces. on parking and traffic, we increased our budget net by $4.2 million and involved the various line items that you see here. the biggest adjustment was the gross of our parking garage revenues. historically we've been reporting net, bottom line. and from an accounting perspective it's better to report both gross revenues and net expenditures. so this includes a $14.9 million of the revenue picture. we also -- you also approve the audit extension -- the toe contract last board meeting and that adds $2 million to our revenue line item. as well as reheard from the treasurer tax collector that we should expect about $600,000 more in parking tax for 2011. this has been offset by three adjustments to our revenue. we were little bit aggressive on our parking permits and we've seen a decline in our

neighborhood parking permits. so we reduced that by $3 million. we've also reduced the parking meter collection by $6.8 million because of the delay in -- the park installation by about 90 days plus the new meters that are going to go out a little bit later than we projected. we're also decreasing our projection for the parking and while this is employment parking it includes the employee parking and the citywide parking process that director beach mentioned earlier. so instead of implementing september 1, we are trying to implement january 1 and come back with a full report to you. and then we also received some good news about our fund balance -- i mean, our transfers from the general funds. so we are seeing $5.6 million additional revenue from the general fund. $2 s&p 1 million of that is the result of the -- $2.1 million of that is the result of our baseline budget.

another $100,000 in the departmental recoveries. for 2011-2012. one increased parking traffic fines and fees and in transfers to the general fund. once again, the majority that is due to the gross revenue adjustments carries over the other line items from 2011. i ask answer any detailed questions you have on that. on the expenditures side, once again, the bottom line has gone up by $20.5 million in 2011 to $20.9 million in 2012. here's the reason. it is due to the service addback. we've added back 5% of additional service. we also have the wage increases for the transit operators which

came in at 5.7%. so the $10 million increase is due to two things. one is a 5% transit service addback as well as the operators' salaries increase that affects all of the overtime, retirement benefits as well as the base salary and some premium pay amounts. the contract and service amount this is the line item where we put the expenditures for the parking grauges and we were able to fund $7.9 million this year -- 2010, which reduced the budget in 2011 for those professional services. materials and supplies and equipment maintenance. those are exclusively due to the addback of service. we also you will be approving a new lease at 1608 bankroft.

we are hoping to consolidate our shops and that will increase our lease payments. but with a significant enhanced service for these shops that are now residing in pretty old facilities. and then $6.1 million of payments to other agencies. once again, the majority of this is due to the parking tax payment that we now have to show because of the grossing up of the revenue and expenditures. there is a $1 million addition to our work orders that we received after you approved the budget. for 2011 and 2012, $11.8 million is made up of these following line items. we reduced savings by $7.2 million and because we felt that there was enough cushion in terms of hiring additional

staffing plan that would allow us to realize these savings. once again, contracts and other services are mostly due to the gross up of the net and revenues of parking facilities as is the insurance and payments to other agencies. one new item that is also on the board calendar is a loan payment for m.t.c. so the $4.9 million reflects first-year repayment of the loan that is now in the budget. and once again we upped our work orders by $1.1 million. so these are the major changes to the budget and this is the current budget as it exists in the system compared to what you approved. we're happy to answer your question. director beach: thank you for the presentation. i appreciate the response on the employee parking permits. you indicated that you would probably be january 1 of 2011 before you implemented. yet i see in the presentation

on page 4 that you're recalculating the baseline from implementing for 2011 and 2012. it doesn't start until july of 2011. >> and the reason for that is the employee parking is the heading for a couple of various subset of line items. one is parking, two the employee based parking. the third area is the planning code change that we were going to implement for parking garages. it really is all of the parking changes. it should probably be better titled. the budget that you approved projected that we were able to implement the planning code changes. that will affect the 2011-2012 number. that number is really a reflection of the downscaling of the planning code change. and it has to do with the c-3

area being implemented rather than citywide plan that we originally envisioned. director beach: if you could include that in the explanation when it comes back to the full board it will be very helpful because it's unclear still to me how much of this is our employee parking, how much of this is city permit parking which is a big issue when it came to this board and how much of it is related to the zoning issue. chairman nolan: members of the boards. questions. director heinicke. director heinicke: thank you for the presentation. first of all, what currently -- these are all about 2010-2011. what is our reserve our fund balance? >> we're actually closing the books in 2010 so our funding balance will depend how we close year end so we will have a better picture for you

sometime in the september maybe in the workshop time period. so we expect to end the year off with a slight fund balance. director heinicke: the question is more at the policy level we shouldn't mistake some of this rosey news for a situation where our fund balance has been restored and still the case that we -- we would have limited ability to respond to any significant emergency? >> and that's true, director. actually we are sort of -- you decided not to follow your own policy about funding the reserve these two years so that continues in our projections that we're not refunding the reserve. director heinicke: right. and that's something we may want to revisit in september because there are some implications to that. i am not saying one way or another. that's something we need to revisit to the board as to whether we continue to ignore or defer that policy. chairman nolan: especially as we continue full restoration of

our -- according to your policy right now we are at a deficit spending. director heinicke: correct. because whenever there is a surge in energy price, so i appreciate revisiting that in september. second question, $1 million in adjustments to work orders. is there in particular work order or a bunch of them with nickels and dimes? >> across all the work orders. we will update it at the september workshop as well so you will get a detailed number. director hinge he ry: this isn't a -- director heinicke: this isn't a particular number. on the very first line item of the revised operating budget expenditures, you have $10.3 billion of combination of service restoration and the wage increase. how much is for the restoration

and how much is for the wage increase? before we get there -- is a portion for the wage increase the entire price of the wage increase or is it an additional beyond what we had budgeted for the wage increase? chairman nolan: ok. we had a gestimate of a wage increase. it actually came back at $7.75. we had to incrementally increase above what we projected in this budget when it was presented to you. director heinicke: how much is it to cover half of the wage increase for our transit workers? >> so this -- it's a little more complicated than that because this $10.3 million is net of reductions of all other labor unions plus the adback of the $5.75 million. so those two numbers are very equal. they almost can sell each other out. so this -- the net number for

service addback is close to $10 million. however, if you disregard it and look at the transit operators, the budget was close to $14 million. remember we had budget in 2009. director heinicke: let me ask it three ways. how much did it cost on salaries and maintenance to restore 5% of our service or addback half of the service we -- add back half of the service we cut? how much service did we gain thanks to the other unions and how much are we paying total for this $5.75% increase? >> so let's start off with the savings we got from the other labor unions first. that was somewhere in the $9 million. director heinicke: $9 million for the -- >> local 21. >> the labor increases for the

t.w. added up to about $11.2 million in salary line item and another $2.5 million in the trust fund payment. so about $14 million total. director heinicke: $14 million in salary and benefits to restore half of our service cuts? >> no, for the t.w. increase. director heinicke: it cost us $14 million. >> right. director heinicke: how much did it cost us in salaries and benefits to restore the percentage? >> so $4.3 million to add back the service component. director heinicke: thanks in part to $9 million from the other uniyors we were able to restore -- unions we were able to restore half of the money. we have to implement a $14 million raise this year because we received no concessions from the t.w.? >> $11 million -- a little over $11 million is salary and benefits. and then $2.5 million for the

trust fund payment which isn't a salary and benefit line item. it's that additional money that we have to set aside for benefit increases for the health care component. director heinicke: we have $9 million in givebacks. we used some of this money to restore salaries and benefits associated with the service restoration. that's $4 million. but the reason we still have to add $10 million is because we have an overall $14 million increase to t.w.u. and we have gestimated it would be a 3% increase when in fact it's a 4.75% because of the charter? >> yes. director beach: one other question. in your presentation on page 3 you talked about a prop k one-time award. is that the money from the transportation authority? >> it is.

director beach: ok. one concern i have -- i'm glad to see that -- hopefully that's all lined up because i think i made the motion to make that service change contingent on that. are all of the i's dotted and t's crossed here? my concern is that we spend too much money to get money, i.e., special needs or requirements from the t.w. money that will net that $7 million down to a lower number. >> director beach, you bring up an interesting point. the way this money will be allocated is through a drawdown as we do on other grants and there has been additional requirements that the t.a. has imposed on this money as it relates to our receiving it. the actual impact in terms of our staffing costs in terms of additional reporting we haven't totally quantified. but there will be a net impact in terms of staff time to go capture this money and draw it down as we implement that targeted rehabilitation program. >> ok. my concern is --

director beach: my concern is that it doesn't return to the minimum payment on the credit card each month? >> yes. director beach: thank you very much. we appreciate your outstanding leadership at every respect in this. chairman nolan: mr. ford, as you reported, i'd like to take a moment to recognize members of the board, cheryl brinkman, she is the nominee for the board. she's appearing before the rules committee tomorrow. i am not -- we wish you well and we look forward to working with you. thanks for being here this afternoon. >> ok. mr. chairman, members of the board, the next item we need to present to you is related to our capital assets inventory and our state of good repair program. since the last capital improvement program update in june of 2008, the m.t.a. in

conjunction with our regional and federal partners have undergone some significant financial challenges. and this has placed us in a position to put a greater focus on our limited capital resources as it relates to our safety, strategic expansion of the system. so over the last year we have developed an expensive asset inventory of all of the assets belonging to the san francisco m.t.a., particularly focusing on their condition of those assets and their useful life. in addition, we developed a set of criteria that meets the he's -- the agency's multimodal process. we are currently in the process of prioritizing the future capital needs which consists of over 00 projects of various sizes, covering all of our modes of transportation over the next 20 years. director ford: we used a tool called decision lens, it's a software tool that helps use standardize the capital pry

ortyization -- prioritization process. it is currently to be valued over $11 billion. the total assets of the san francisco m.t.a. infrastructure, parks, equipment, tools, facilities, totals over $11 billion. here to present the details of our capital asset inventory and state of good repair program is our manager of capital planning. >> good afternoon. thank you, mr. ford. chairman nolan, members of the board. i have a short presentation today to talk about our capital asset inventory, share with you some of the initial findings from our efforts today and to talk about how this goes about our state of good repair program. we formally started this effort back in 2006. at that time we only had a

quantitative inventory of our vehicle assets at that point. and we're trying to expand that to cover all of the agency's assets. we update the information, we'd like to add some condition information so we can better understand how effectively and efficiently our capital assets are functioning. one of the more immediate goals is to produce an initial state of good repair report to submit to f.d.a. this august. this is the first time that we really quantified all of the agency's assets and this includes all of the vehicles, both revenue and nonrevenue,

all of our infrastructure, track, overhead signals, the various systems that we manage, communication systems, collection systems, our facilities which include both the passenger facilities and our operating facilities and all of the equipment our i.t. systems that help to make the system run. we've been participating it he regional level. what we're doing here in san francisco all the other transit agencies are trying to do as well in the bay area. we're reaching the second phase of this effort where m.t.c. will be reviewing each of the comparblete. are we -- compareability. we need to look at the funding