challenge us every day. it is amazing the amount of work we can put out and win awards for. thank you very much. i appreciate this opportunity. chairperson nolan: mr. lee? >> i want to echo all the things they said about our team. i am just one part of the cog that pulls the expertise together the presented. i also want to thank the board and my team, and murray and deborah. it is uncommon for an agency like this to create a very creative environment that we feel it is easy for us to do the work we do. that are very encouraging. they are wonderful to work with. chairperson nolan: thank you all very much. [applause] executive director reiskin:

thank you. finally, from our finance division, i want to ask jason lee to come forward. one of the things i have found is we have strong operations people. we move people every day, and take care of our rights of way. but what we really need to move the agency forward are smart, analytical people, people who can dive into the data, analyze the policy, and come up with good recommendations based on a sound foundation. i think jason really epitomizes that within the agency. he has only been here since 2008. he is a manager of financial contract services, which i do not really know what that means. but i know what he does. he has a great understanding of transportation and transit, a great capacity with numbers and analysis. as one example, when we started

looking at all-door boarding and wanted to understand fare evasion and how that might impact all-or boarding, and i started asking questions about what we knew about it, they whipped out a report jason had done two years ago, a thorough report that shows where, why, and how it happens and what countermeasures we might put in place -- a thoughtful, professional piece of work, which is exactly the kind of thing we need to make good decisions in this agency. i am very glad to see jason up here and want to invite him to say a few words. >> happy new year and thank you. jason just won an award from the transportation research board for the study he did on fare evasion for under 35. he is going to washington, d.c. to get the award, a prestigious award for great work.

jason's commitment to transit is unparalleled. he does not own a car. he is always in my office bugging me about why can't we do this or that on transit. i sometimes, him down -- calm him down. he worked for cta and bart. i am proud of his commitment to the agency and system. thank you for everything. chairperson nolan: on behalf of the board, thank you. we appreciate it. >> thank you very much for this honor. i would like to acknowledge the sponsorship of the proof of payment study by our leadership from finance and technology. some of you who might have been around when the study was conducted -- it consisted of surveying over 40,000 customers on over 1000 vehicle runs, all over the city, all times of day.

that level of effort could not have been done but a single individual. it required transit operations and sfpd. i wanted to thank them for that. our survey team consisted of city hall fellows and interns, as well as the 78 staff in this room today. -- as well as some of the sfmta staff in this room today. i want to acknowledge their effort, and the proof of payment officers. often, the only in counter the public has with them is unfortunately negative, getting a citation. but they do and not standing job helping keep our fair regulations -- fare regulations in place. they do a lot of things work. i want to acknowledge them. i got to know them personally,

and they do a great job for this agency. on behalf of all the people who helped in this effort, thank you very much. [applause] executive director reiskin: if i may, a few quick other updates. on the central subgrade -- subway, some good news, one in terms of the relocations. we had purchased the building, or were in the process of purchasing the building on stockton street, at stockton and washington. it was occupied by both residential and commercial tenants. i am happy to report, to the great work of our real estate team and city attorney's office, but all 19 households have been successfully relocated to new homes. seven of the eight businesses have been relocated, and we are about to close escrow on the building this friday.

an extremely challenging environment to operate in to smoothly and relatively seamlessly move folks, many of which are in a much better place. if you are moving from rental to ownership. -- a few are moving from rental to ownership. it was great to be able to move forward in the project that sits on the site of the chinatown station. other great news has to do with funding. we got word that state crop wannabe -- 1b bond funds are coming in to the tune of $16 million. that our funds in our spending plan that we had anticipated, but until the bonds were sold and the checks got to the city, we hold off on celebrating. we got the $16 million. the $20 million we got earlier, last year, consistent with the

requested made the year before -- that is good. we are working actively with the state and through the mtc and caltrans to try to make sure the rest of the bonds committed to this project continue to be sold in line with our cash flow needs. we will be working on that. but the fact that this money came through in an -- even when the state is in a difficult fiscal situation is good news for our project. we have prepared an ordinance that would amend the planning code as part of the special use district for the chinatown station site. we need some changes to make our project work there, including allowing demolition of the building in advance of beginning reconstruction there. the ordinance was introduced by the board president in november, and will be going before the planning commission on january 26 and to the board

of supervisors in march. that is something we have done in community work on with the planning department. it is another step on the ladder of things we need to make the chinatown station move forward. it is good news that that is moving. finally, you may have seen the press release on it. we have initiated, or will be initiating, a route of the 30 and 45 buses to the west side of union square, starting on january 21. for the time being, we are not changing the eight. but the 35 will loop around the west side. that will be in place for about four years to facilitate construction of the central subway. the central subway does have a new website that was launched on december 21, so i encourage you to check that out at www

.centralsubwaysf.com. it is user-friendly, with a lot of product information. we hope that will continue to improve communication with the public, with regard to arguably our largest and most significant capital project. a few other points on service improvement. i may have mentioned this briefly before, but i am happy to announce we have finalized the plans for expansion of the 14l to daly city bart. it was a pretty big gap to have a major station and transit line so close to connecting, but not actually connect. to extend those extra blocks will be a huge connected with the improvement between unique and bart. -- muni and bart. the was a lot of communication to make that happen. we are happy to see that

scheduled to start january 21. it will run during the morning and evening peak. the 28 and 28l -report- did earlier we took a number -- the 28 and 28l, we are happy to report we took a number of pieces of the back, and as a result changed the schedule to better match the flow. we put some provisions in place. the initial results are promising. the on-time terminal departures exceed 85%. they were far from it before. on-time performance has improved 4%. we are maintaining all of the runs filled. we are monitoring it closely from our management center. the approach that mr. haley and

his team took to focus on that route, making improvements and measuring the success, which we will continue doing as a march through the system, in this case has paid off. then a couple of revenue issues. you have established at -- i think it may have been your last -- but you established a bond oversight committee to authorize the issuance of debt to support agency capital needs, a power given to the mta through previous voter initiatives but not previously exercised. with that power in place, you authorized the establishment of a bond oversight committee. today on the consent calendar, you are going to be considering appointments to that committee.

you had given the director of transportation one appointment. i have made that appointment in the person of jackson long -- w ong, who is currently the chief operating person at the airport. he has a long history with the city and capital delivery. he is very knowledgeable. a longtime san franciscan. he is going to retire from the airport, but was still willing to serve with us. the comptroller has an appointment to the committee and has appointed his head of public finance, who i know from my time on the capital planning committee is extremely knowledgeable about all things public finance on bond financing, and will be a great addition to that committee. the final two appointments will be from the citizen's advisory committee and counsel. they will be discussing them at the january 5 meeting. once you have made yours and

they have made theirs, we will have the seven member body established. it will meet some time in the spring after we have gone to the next legislative steps to get the revenue bonds moving. finally, i wanted to report back. when we had our board workshop on the budget, one of the things i recommended to you was to authorize us to move forward on convening a stakeholder panel to look at our budget issues, our structural budget issues as well as our regular annual budget issues. we have since put together a group of stakeholders from business, from labor, from community groups, from stakeholder groups. we have our first meeting today. the outcome of this process will be recommendations to the mta board sometime in the may timeframe.

i wanted to let you know that process has started, and hopefully will get us some consensus recommendations with political support to help close the gaps that we face here every year, and in a more structural sense. with that, i will close by saying i enter 2012 with a great deal of optimism. i think this will be a great year for mta and transportation in san francisco. there are a lot of stars aligning that give us a great opportunity to advance the ball in a meaningful way. we have a strategic plan for your consideration. that will drive us in a direction. under your leadership, with the great work of the staff, and working with the public, i think we can expect good things in transportation in 2012. chairperson nolan: we conclude on december 28? >> that is right.

we have started our 100th year of service on december 28, 2012. chairperson nolan: there will be things in the course of the year to highlight this? executive director reiskin: we brought a preview for you. we will bring more events to commemorate 100 years of munis service. chairperson nolan: members of the board, any comments? members of the public? thank you. next item. >> item 8 is citizens advisory council report. chairman murphy is not here, so i will assume a report. item nine members of the public might address the asset mta board of directors on matters within the jurisdiction. no one seems to be interested in coming forward. moving on to your consent calendar, these items will be addressed by a single vote unless a member of the board or

public wishes and item be considered separately. i have received no request for that. the calendar is in your hands. chairperson nolan: is there a motion? >> motion to approve. >> i will second. chairperson nolan: so ordered. >> item 11, presentation and discussion regarding the fiscal year 2011 year-and financial audit. -- here- -- year-end financial audit. >> good afternoon, board members. a very quick presentation to give you a summary of our closing statements. as you know, our audit is part of the city wide audit. our numbers are folded into the city wide financial report. the audit is selected by the

comptroller by charter. it includes our financial audit as well as a single audit. we also get a management letter each year, in terms of findings. i am pleased to report we have no findings, so that is quite an achievement. this is what the picture looked like between 2009 and 2011. we had a $127 million increase in net assets. the majority of that was in the revenue side of the house. we saw a $23 million increase in operating revenues, another $19 million in non-operating revenues, mostly from getting a grant in 2011 which we did not have in 2010. we saw that $66 million increase in capital contributions, mostly due to the aara grant, and an increase in our general fund

transport. we saw a slight increase in administrative costs, as a result of revenue expenditures increasing by $123 million in two years. our balance sheet -- once again, we recorded about a $144 million increase in total assets, the majority in higher revenues and the capital assets because of the [unintelligible] we sought a slight increase because most of the funds were used in the prior fiscal years. we saw a slight increase in debt service. we saw a $25 million increase in non-current liability, mostly due to pension and benefit costs, and a $6 million decrease in state grants. our net assets and liabilities -- $127 million. that is a quick summary of what

the numbers look like. i would like to introduce you to tiffany rasmussen, the audit coordinator, who will go to the audit from their perspective. >> good afternoon. you have a presentation that is five pages long, but i would like to cut to the headline. we issued an unqualified or clean opinion on the june 30, 2011 financial statements. we did that on october 28, 2011. in my experience with mta, which goes back to 2000, that is the earliest ever. i must say it was a tremendous team effort. the controller's office and the whole team in the finance group worked very closely together and we made it happen. now we have made that happen and the office said it will try to go earlier next year. be careful what you accomplish. [laughter] a great audit.

i think the management team and staff. it was a very smooth audit. it met deadlines. the statement has been issued. the single audit will be issued this month, which is also earlier than it has ever been accomplished before. a lot of good things this fiscal year. i will entertain any questions you might have. chairperson nolan: thank you very much. >> no one from the public has an interest in addressing you on this matter. moving on, item 12, approving the strategic plan which represents the vision mission statement, goals, and objectives for the agency. chairperson nolan: thank you, director bridges, for your willingness to serve on the overview committee. you bring a lot of experience to this. and i notice our treasurer. thank you all. executive director reiskin:

thank you, chair person. i should mention a was apparently remiss in not providing an update on the church and bose construction update, which was on the agenda. chairperson nolan: i did not mean to suggest you were remiss. executive director reiskin: it was an error and i was remiss. it did not take long. the reason i did not have a report is there is no change since the last report. the project is on track. i will bring you a real update at the next meeting. on track, so to speak. moving to the strategic plan, this has been before you a number of times before. we went into it in depth in our november workshop and got a lot of great feedback from you. we are very proud and pleased to be bringing for your consideration final approval and adoption of the plan. before i have a brief

presentation to work through -- before i do, i want to acknowledge some of the staff who have been leading the charge on this. it has been a lot of people inside and outside the agency working on this, but a core group drove it to where it is today. i do want to acknowledge ann fritzler, christopher, patricia, and others, all under the leadership of papandreou. a phenomenal effort to pull together complex ideas for a complex organization into what i think is an elegant and straightforward format. we have put the entire plan up on the website. i am not going to go through the entire plan. there is a lot of narrative and text that supports the core elements of it, which you have reviewed before. if somebody can do the slides, i

just want to quickly walk through to give you in the public an update of where we landed on the plan. while tim is getting this up and running, what i wanted to say is one of the first things i would have done coming into this job would be to start a strategic planning process, because i think having a plan to guide where we are going, everybody working off the same sheet of paper, going the same direction, is incredibly important. i was happy to find you have already started that process. tim already had it under way. it is great we are at this point and will be able to kick off the

next fiscal year with i think a very clear direction. the presentation is not on there? ok. i guess what the main points that i wanted to convey today -- first, an update. we got a lot of feedback from you. we got feedback from a lot of stakeholders, much of which we were able to incorporate into the strategic plan. we have a complete document today that includes not just vision, mission, goals, and objectives, but he performance indicators and targets for those indicators that will encompass the whole strategic plan, along with a supporting narrative. what we are aiming to do today is seek approval and adoption of the plan. in the next five or six months,

we would flesh out the actions needed under each of the objectives in order to accomplish each objective, which in turn enables us to accomplish each goal, and developing a complete set of measures. what we have in the document our performance indicators. it is not an exhaustive list, just key things we would focus on. we showed you a draft in november. they have been refined somewhat through what we received. to restate it, the vision that we are proposing for the mta -- san francisco, great city, excellent transportation choices, and a simple, straightforward vision that accomplishes -- encompasses a lot of where we want to be, without using a lot of words. the mission statement is more or less as it has been before.

we work together to plan, build, operate, regulate, and maintain the transportation network with our partners to connect communities. the work together part is important, both within the agency and the government, with our other stakeholders. the fact that we do it with our partners, such as regional and community, state, and business partners -- we are connected. some key phrases that speak to what we do to speak to the staff to move us forward. moving on, the four goals -- these are more or less as you saw them before. the first goal is to make sure the system is safe. the second goal is really to make transit first work.

the third goal is to make the city a better place. the fourth goal is to improve the organization itself in order to achieve the other three goals. taking a lot of work his agency does, breaking it down to what we believe are straightforward, understandable, accomplish a bold goals -- accomplishable goals. we have a short list of objectives under each goal. with each of these objectives, we have identified a key performance measure and targets for each fiscal cycle in those. under the safety goal, the objectives are improving security for system users, such as reducing crime on a muni, improving workplace safety, and improving some of the collisions

and accidents we hear about. those are the three legs of the safety stool. gold to is basically the transit first policy -- goal two is basically the transit first policy, improving customer service and communications, improving the performance of muni, which will get more people to use it. increase the use of all other non-private modes of transportation, which is the balance of the transit first policy. it is not a transit only policy. it is transit first. we use the other modes to reduce the amount of troops people need and want to use their own cars for. related to that is to make parking work, to continue optimizing parking to manage the demand so it works for transit. that is the transit first goal.

improving the city goal, we see a larger role we can play in the city in terms of its environmental performance, which is really the first objective, the direct impact on the economy, which is the second objective, the use of resources. we want to be a well-run organization as part of the city family and fabric. we want to be able to deliver our services efficiently, because transportation is so important in san francisco. it directly impact the quality of life here. finally, i made reference to the revenue or budget panel earlier, to reduce our capital and operating structural deficits. if we do not address them, we will not be able to achieve much. finally, the fourth goal is really the inward-looking girl.