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>> the good morning. this is the tuesday, september 20, 2011 meeting of the finance committee of the san francisco county transportation authority plan name is eric mar, the chair. to my right is vice chair, sean elsbernd. we have commissioner kim and commissioner farrell. our clerk is ms. erika cheng.

>> there are no announcements. commissioner mar: could you please call item number two. >> approve the july 12, 2011 meeting. this is an action item. commissioner mar: so moved on without objection. is there any public comment on this item? seeing none, public, disclosed. without objection, colleagues? thank you. please call item number 3. >> recommend authorizing the executive director to execute a memorandum of agreement with the national park service for one- time span with two additional one-year extension options, in an amount not to exceed $105,845, for liaison services for the presidio parkway project and authorizing the executive director to negotiate the agreement terms and conditions. >> the first item is related to a contract from the national park service's. this was originally to be presented by our deputy

director, but he is having some traveling issues today and asked that i present this item. we also have representatives from the national park service's here. rick and nancy, to my right here, for any technical questions that come up after the presentation. i know you are all familiar with the presidio parkway project. we -- you may have seen this item last april, april 2010. we brought before you this contract, an 18-month contract, asking to support a liaison at 75% of services to assist the doral drive project with attended meetings, according any reviews of project submittal and documents, and providing any responses to the 14 different agencies all working on the presidio parkway project. right now, we're in the design

and construction phase. into next year, we find it necessary to continue the services from the national parks service is. the liaison will organize all the responses from the various agencies, facilitate communication, prompt identification, and present resolution to any issues. we like to extend the contract for one fiscal year, with two additional one-year amendments. the contract would be at a level of 75% of one staff. that may be covered by rick foster and back of staff. the amount of the contract would not go past $105,845. this item was brought before the cac committee on september 14, and they all unanimously voted for the item without any issues. this contract will be funded by

an appropriation. the appropriation originally approved in fiscal year 2010. with that, we would like to seek a recommendation to approve a one-year contract with two one- year extensions for liaison services with the national park service's and ask that the executive director be allowed to enter this agreement and modify any terms and conditions. if you have questions, yes to more than happy to answer them, and i have two representatives from the national park service is here. commissioner mar: thank you. questions, colleagues? and seeing none, i would like to abolish our colleague, commissioner cohen. anyone from the public that would like to speak? >> good morning. my name is nancy, the planning program manager for the golden gate recreation area. i want to express our

appreciation for the support. this is the largest construction project in the history of the park, and it takes place entirely within the boundaries of the park. the potential of the impact apart resources and of the visitor experience is quite high and over a long duration. we found that the services of coronation, liaison and problem- solving, have been critical to both the park and the success of the project. thank you on behalf of the park. commissioner mar: thank you. with the public like to speak? seeing none, public, disclosed. can we take this without objection? thank you. >> item four, recommend approval of the revised debt, fiscal, a procurement policies and ratification of the current investment policy. this is an action item. >> the start on page 13. this is our annual update of the authority's policies. we have the investment policy, the debt policy, the fiscal

policy, and procurement policy. as we do on an annual basis, we seek recommendations from our financial advisers and from our specialized legal counsel. we asked them to review our policies. one of the two would review the policies and make any recommendations. we're looking to update the policy in accordance with the government code and with the objections of the authorities during school year 2011/2012 work plan. on page 16, we have a matrix of all the policies, and a red version of each policy. the matrix shows different segments within the policy. we show you what we originally had in the prior fiscal year. after, we'll show you what changes are made. most of the changes are clarification type changes or restructuring procedures within a process or we have updated the

government code, so it would be in compliance with our policies. regarding the investment policy, we asked the financial advisers to review it. there has been no changes to the applicable laws. therefore we're asking to ratify the policy as adopted. the debt policy, we asked knn financial advisers also to review this. we have made changes in terms of making the policy more flexible, providing more options for the authority when we come out and issue debt as anticipated for this fiscal year. we made changes to our debt service structure, our credit enhancement, our letters of credit, and our continuing -- we made and added to the continuing disclosure section of the policy. again, these are providing more flexibility and options for the authority once we do enter and issue the bonds. the next policy we have is our

fiscal policy. we asked this to be reviewed, and the lead item we have to update is the conflict of interest section. we're updated in accordance with the government code has indicated. so we're in compliance with that. our procurement policy, we have asked for this one to be reviewed, and we have updated the conflict of interest formal bid process and the procurement protests and appeals procedures. again, these are updating to the government code policy in making any further clarification within the instructions of the policy. last, this item was brought before the cac committee on may 25. members had a couple comments and asked for further clarification in the procurement policy and the fiscal policy. we met with them over the summer and made a couple more adjustments.

we brought it before the cac again on september 14, and the item was unanimously approved by the entire committee. with that, we're recommending the debt, fiscal, and procurement policy changes to be made and a ratification of the investment policy. with that, i am more than happy to answer any questions you may have. commissioner mar: so the debt policies and more flexible with these amendments. the fiscal and the procurement policies are confirming to government code. in dealing with a conflict of interest for the fiscal policies. is that right? >> yes, those are the main changes we made. everything else are just minor clarifications we got to make all the policies consistent with in each other. commissioner mar: let's open this up for public comment. would anyone like to speak? seeing none, public comment is closed. colleagues, can we move this

forward without objection? thank you. please call the next item. >> item 5, state and federal pledges that about it. this is an action item. >> good morning, commissioners. executive director here. i have invited our sacramento legislative advocate to give you a wrapup of the session. i will talk later a little bit about the federal side. >> thank you. mr. chairman and committee members, the legislature wrapped up on september 9, so a number of bills are pending approval or review by the governor. i thought i would catch you up on several of the bills that we monitored or supported on your behalf through the year. and a brief discussion of were the high-speed rail legislation stands. we have talked about that from

time to time. i will close with two or three late breaking major bills that were amended in the last week's session. first, page 5 of the matrix, we watched that dealing with infrastructure financing districts and streamlining the process to enact those. a lot of progress was made on ifd bills, but the member decided to put this on inactive to see how the governor treats a couple of other bills. i think she's waiting to see if there are any changes she may need to make next year in order to be more assured of a giddy -- getting and approval of that measure. we also supported ab 1041, on page 11, and that extended the authority for the city of san francisco to continue using video for a transit line

enforcement. that is on the governor's desk. we are asking for approval. we will see how that goes. we do not expect any issues. probably one of the most watched bills of the year, of which is on page 17, we had only had a watch position here. that provides your city and county with the authority to impose a backfill of the vlf, up to 2%. that is on the governor's desk. it does require a local vote of the public, and we will see if it is enough to garner the governor's approval. i had to look at the department of finance analysis of the bill, and i have to say, if you follow the department of finance's thinking, he probably will not sign the bill, but i think he's more flexible when he reviews measures. we will see how that goes. sb 582 is a measure that we have

supported through the year, which provided for benefit options. an mtc-sponsored bill. it had a republican author for most of the year. at the very end, i think in the wake of bad feelings around the budget, that author give the bill ought to senator yee, who carried it over the finish line. the governor vetoed it. i would not have expected that veto. there really was no explanation other than the governor thought it was not timely enough to impose more burdens on local businesses in this economic environment. i think it is a bill that may come back in the future. i cannot not mention ab 57 on mtc governance. earlier, we were able to have that bill shelved for a while. the senate transportation

housing committee conducted a governance meeting, a hearing last week in san jose. an interesting venue for that kind of a hearing. you know, i have that reports from a variety of folks who attended it. nothing real conclusive at this point. i expect we will have one or two more hearings during this fall that will help frame for this legislation and how mtc governance would be determined as we get into the 2012 session. throughout the year, we have talked about high-speed rail legislation. at one time, there were over 20 bills on the topic. some trying to kill it, trying to improve its, and others radically changing the course of it. most of those fell by the wayside during the year. three key bills the merged as a viable bills of interest. those are ab 16, page one of your matrix. ab 145, page 3.

and sb 517, page 19. one bill deals with try to establish a california-first policy for and rolling stock procurement. i will describe the other two bills. one would create a new department of trains that would bundled high-speed rail with the current division of rail and caltrans into a new department. in contrast, the other measure approaches it different. it just takes high speed rail authority and places it into the cabinet secretary's office. it has a host of other changes, but that is the main thrust of that bill. the administration spent most of july and august and digging into the high-speed rail program, trying to understand it and get their arms around it. to the extent that they finally appointed one new member, who they have a high degree of faith in, dan richard, used to be on

the bart board and is a consultant in washington. he has now become the governor's point person on a high-speed rail. collectively, they asked all three authors of these last standing bills that they would wait until next year to put these bills on our desk, because we need to get our hands on how we will deal with the project in the program. there is an urgent assessment going on at the highest levels of the administration, including the governor. we're anxious to find out what direction the governor decides to pursue coming out of the fall. there were any least two major, major policy bills that popped up during the last month of session. after the summer recess was over, everybody came back and were trying to move all the bills that were in their position to the governor. in the middle of that, ab 294

dealt with a special way of procuring highway design projects, called design sequencing, was amended on august 31 with less than two weeks to go until the end of session. is it essentially would have come in my view, overturned the appellate determination in the presidio project. they went back and try to correct the language that they thought they obtained in the p3 and design build elements of sb 4 from 2009. my office led a quick-hitting coalition effort the day after that. by the afternoon, we were able to have that bill placed on a senate inactive file by the senate protest. they judged the dead being to con -- the the judge did as being too controversial. one of the times things worked.

the other measure will be coming back. yes and not making a recommendation at this point. it is sb 791, amended on august 21. we have known about this measure for most of the year. the senator had been cultivating some of my clients to support it. essentially, it provides -- i will call it a gass fee. under his measure, they would have authority to impose a congested reduction charge -- that is the new terminology in sacramento under proposition 26. things and not taxes or fees. they are charges. the terminology -- the terminology is now a charge. they feel very strongly that they have found a clear and

brought path through proposition 26 that justified -- justifies it as a fee, which then allows the bill to be approved on a majority vote bases in the legislature, not a two-thirds vote. commissioner mar: what pages that on? >> it is not on the matrix. it is just one wanted to report on. we will be acting on it if we get word. it will be coming up. it is sd 791. on the last day of session, it was used for another purpose. so there is no existing bill, but i know it is in the panoply of legislation that will be pushed forward. commissioner mar: are there other bills that are trying to get around proposition 26 with this type of semantics? >> this is, i would think, this is the premier showcase piece of legislation. one reason we believe senator steinberg wanted to move forward and put it into play the last month was they want to get

tested in the judiciary. because they think they have got an ironclad definitional approach that fits into a fee instead of a tax. commissioner elsbernd: you said it allows the agency to impose this fee. does that mean they have to go to the voters? >> an interesting twist. the bill does require a majority vote in the jurisdiction in which the charge would be imposed. correct. there is a section in the bill that says that is not a requirement of the constitution. it is simply a requirement of the bill. and that was placed in there, i believe, as anticipation -- in anticipation of the governor. commissioner elsbernd: i think that is nine counties. does that mean a san francisco can help carry it over if we

paid 80%, but say sonoma is down around 30% -- >> correct. we found this in sb 375. for that region, it is a region- wide authority. in at the southern california region, it is either scag-wide, or they can delegate to individual counties. there was significant discussion in the weeks following the introduction of this language here in the bay area about a return to source guarantee. several of the counties were present for that. ntc seemed willing to put it in there. they fell to return to source with foul their findings process and get them around proposition 26, so they rejected a return to source. that is in play. i do expected to come back. it may need certain further refinements before we see it again. but it was in existence for at two weeks, and then its

evaporated. but it is in play in sacramento and ready to come back in 2012. commissioner elsbernd: i have another question about another bill. assembly member hill -- then he tried to do a bill for caltrain were the three counties would be able to do a 1/8 sales tax increase? and it kind of went away? >> yes. because of the introduction of 791 unexpectedly, the assembly had been trying to find a place for the 1/8 discriminator, and it just became too much for them to handle. so i think they decided not to move forward with that. also, in assembly speaker made a determination on 791 to hold it as well. that is my report. we will come back -- i will come back with a more exhaustive

report on 791, because there's a lot to digest. i promise i will not make it an exhaustive report, but the right up will support my brief report when i come back. commissioner elsbernd: have there been any special sessions or do you expect them? >> i always expected them. things are deteriorating on the triggers. there were a couple efforts to modify the triggers. the governor rejected them. so we're going full speed ahead, and the triggers are in place. if the revenues are not there, you're going to start feeling the pain, and i you think that will force a special session. commissioner elsbernd: enacted land a transportation slot? >> because of the fuel tax slot that was read out to bend the rules under proposition 22 and 26, i think transportation is in a safe harbor. there may be some little part of

the they could come after. but by and large, we already gave $1 billion to the general fund through fees. thank you. commissioner mar: thank you. we were going to continue on the federal level issues. >> commissioners, very briefly, i guess the way i would categorize any clarity on transportation funding long- term, you know, the six-year surface transportation act is still very confused. still very much not out of the woods as far as any kind of consensus. i am sure you heard the president here in his speech a couple of days ago.

his emphasis is still on jobs. there is still a push for more investment in infrastructure. he even has a $4 billion proposal for additional high- speed real money. but the picture in the house is quite different from that. the positions are not anywhere close to agreement. the house appropriations subcommittee on transportation, just 10 days ago, approved a budget bill for transportation that includes a 30% cut. it is a reason to be alarmed, but it has not gone anywhere yet. there has to be the process of reconciling with the senate or so on. but to give you a sense of how complex the picture is in washington, d.c., right now, there is a downright nasty streak that has surfaced in

terms of the debate between investment priorities between transit and highway, to the point that the more conservative side of the aisle, the republican i know, has gone to the extreme of calling all of the special programs that were too -- that were put together, things like transportation enhancements and the things that essentially began to open the door to anything other than cars, whether it is more transit, bicycle facilities, or pedestrian safety, the things we talk about every day in san francisco, those things are being called now hitchhikers to the original purpose and intent of the highway trust fund. the implication is, if we're going to have to do streamlining, which everybody agrees with, if we're going to have to reduce the hundreds of federal programs into maybe a couple of dozen, it looks like

that is going to be used as an excuse to also final all of the money into highway-building. that seems to us like such a start regression -- stark regression for the 21st century goals. i would point out that the highway trust fund is really a creature of the early 1940's, you know, after the war, built in central london -- build essentially on a platform of national defense. the interstate highway system, that is how it came to be. today, the country's two or three times more urbanized than it was in the 1940's. so the need is largely urban. within the urban setting, as we have seen, using the bay area as a microcosm for national policy challenges, the real debate is how we continue to grow in a

more sustainable way. we know that sprawl and suburban life as we knew it for three generations it is no longer really an option 100%, so we have to start finding ways to incorporate options to single automobile driving and so on. were that rhetorical battle is going to land is very hard to imagine, but one thing i can predict to you is we're not likely to see a bill probably until after the presidential election. a contains some of the ideological items that it will be hard to get to a consensus. i would also want to venture that if we do not see a rebirth -- a reauthorization bill until then, that might not be the worst thing in the world. if you see one, is likely to contain less money or money at lower levels than