500 million dollars. now, if we want to go back to revenue, my job is to drop people off as close to their destination as possible. there's one particular incident, 20th and ford in the mission, can be a little sketchy at 1:30 in the morning. drip someone off in front of their house. dropping them off at the corner is potential peril. street sweeper is five blocks away. the ppt parking enforcement person pulls up behind me. i see her, wave at her, say just a second, crack our machine which i use, wasn't going through. i get a ticket in the mail for that instance. i pulled out my waybill which proves that i worked, documented perfectly. the copy of the credit card receipt, submitted that with a fluffy narrative about what happened. insufficient evidence. there has to be some type of congruence there. thank you, sir. >> next speaker, please.

>> mark gruberg followed by [speaker not understood] zamud. >> mr. gruberg. again, to continue and conclude along the lines i was speaking of before, despite the fact that the cpuc has a rule making proceeding going on, you still have jurisdiction over people who are providing illegal services in san francisco that are, you know, the equivalent of taxi services. if you didn't have that jurisdiction, you couldn't stop somebody in their private car who was picking up on the street either. so, all the drivers in these companies which are violating the law, the drivers themselves are also violating the law. and i'm not suggesting that, you know, a $5,000 citation. i think it might be nice to start issuing some warnings to them and, you know, give them a few weeks to get their act in order and then start issuing some citations. i think this is completely

within the realm and scope of your authority to do. i think in the public interest you should do it. and i hope you will. the other thing i wanted to say is that i've heard some statements and some rhetoric here recently about wanting to do things for drivers. , and you know, it sounds a lot like lip service. i'd like to see you put some meat behind that. jai tuft wanted to make a few suggestions of things that you could do that would generally help the drivers. first of all, restore the driver fund that you so callusly stripped of most of its revenues. * second of all, let's have an ombudsman that drivers can turn to for complaints against companies and against those who are violating their rights. an ombudsman might be nice for the public as well. thirdly, let's get drivers and cabs on the clipper card.

this would be a tremendous boost to the taxi industry. and fourth, we need a universal app that all cabs can use, but we also need a centralized dispatch system for conventional dispatch. thank you. >> mr. gruberg, does that conclude your suggestions, those four? yes. >> thank you. next speaker, please. >> [speaker not understood] zamud followed by peter jacobs. those are the last two people who turned in speaker cards. >> good afternoon, mr. zamud. good afternoon. a couple times couple years ago when taxi drivers have to go for their [speaker not understood] renewal and sfmta, and that was the time the protest started from sfmta from the taxi drivers. that was extreme of the wrong thing started by [speaker not understood]. as the time progressed, she continued doing wrong thing and you guys keep rubber stamping. in one of the town hall

meetings she mentioned that mr. jewel and others came to talk to her and learn about terminologies about the taxis. why are you voting when you have to go and learn from her and you are unaware what she is doing? so, going further in this issue then you distributed 150 medallions and it was like whose color is black hair and whose color is black in the other company. whose color is brown hair and whose color -- it was a lottery. it was not any methodical way, any systematic way. why comfort cab [speaker not understood]? why distribute over 32, over 190 cabs actually, only 90 medallion, why only 32? why arrow cab get 32? checker -- [speaker not understood], why town taxi didn't get it? it's all looking at who gave

the checks to mayor lee office for election campaign. mr. reiskin, we understand you have some connection in the past with mr. mayor lee, and you came due to his always happiness. but fairness is very important in this game. and now coming up this technology charge, it's actually a replacement of the credit card fees which is reduced from 5% to [speaker not understood]. you are trying to take it back that way. this is wrong. thank you. >> thank you, mr. zamud. next speaker. >> peter jacobs. and he's the last person who turned in a speaker card with areder to public comment. >> good afternoon, mr. jacobs. good afternoon, members of the board. peter jacobs, [speaker not understood]. i represent arrow checker cab company. as i'm sure you're aware there is a proposal from christin ashley to release [speaker not understood] 500 medallions. we at checker are concerned about this for a couple of reasons.

first, we feel this many medallions are -- really any number of medallions would outstrip the demand in the city. already drivers' wages are very low. and adding more cabs is not the solution to improve service. studies have shown adding even one cab into the city will increase traffic as much as adding 16 personal cars. so, you really need to think carefully about this. how much is this going to back up traffic r? how much are people going to be sitting in traffic more rather than getting to their destinations and moving efficiently? i'd like to back up what mr. mahud said about the criteria used to describe who gets what medallions as well. and the last decision for color scheme permits it was completely opaque. we didn't find out what the color criteria was until the meeting they decided who was going to get the medallions -- permit, sorry.

it has to be transparent. we have to have -- this is really important. the board should have -- the board should vote about what those criteria are and they should be established in transparent manner. as a result of that -- of those, so many medallions, so many of those permits going to just a few cab companies, so many permits were given to, for instance, de soto cab that they could not use all of them. and that's obviously something is wrong. you can't be giving so many permits to a company who can't absorb them or make efficient use of them. thank you very much. >> thank you, sir. anyone else care to address the board? >> no one else has indicated their interest. >> director reiskin, i for one would be interested in a report at some point about some of the points mr. gruberg was making about the jurisdiction that we may have over all the the lift and all those others. and then also the drivers, it

would be good to have a report back on where we are with that. we talked about that many times and as far as i'm concerned -- i think everybody has a sincere commitment to be helpful. so, if the members consent, mr. reiskin. i want to take a moment to welcome back bruce oka, mr. oka, we're glad you're here. [speaker not understood]. [laughter] >> glad you're hear. >> moving on to public comment, these items are considered to be routine, they will be voted on with a single vote unless a member of the board or public wishes to have an item severed or considered separately. directors, i have received no indication that anyone wishes to sever an item on the consent calendar and i see no one moving forward at this point. >> okay. so, that is the motion on the consent -- do you have to read those? >> no. >> there is a motion -- >> [speaker not understood]. >> second. >> any further discussion? members say aye?

>> aye. >> the consent calendar is approved. okay, item 11. >> moving on to item 11. >> can back a second. director oka, did you want to say anything in general to the board? bruce? are you just coming to watch good government in action, is that it? [laughter] >> okay, come on forward. in the meantime, we are honored to have the president of the board of supervisors, president chiu here. president chiu, love to have you come forward and address the board. he >> i will call the item. item 11, authorizing the director of transportation to execute a two-year lease, as tenant, with the palace at washington square for the premises at 1731 - 1741 powell street and 601 columbus avenue, for an annual rent of $400,000 plus reimbursement of certain landlord costs, not to exceed $2,350,000 related to the sfmta's use of the premises to build the central subway project tunnel, and approving total expenditures resulting from use of the site to facilitate tunnel construction in an amount not to exceed $9,150,000, including total lease costs not to exceed $3,150,000 and total additional demolition, design, construction and related costs

not to exceed $6,000,000. >> good afternoon, mr. president. welcome. >> thank you. good afternoon, mr. chair. good afternoon, directors. mr. reiskin. i wanted to come for a moment and really thank everyone who has been involved in the conversation that we're about to have on the central subway and the pagoda theater. we've come a long way since last may when my office got a call on the same day as the first community meeting about the potential disruption related to the proposed construction on columbus avenue. and i know that so many folks here and in the community have been involved in a conversation of how we could really move forward with an obstruction plan that creates a win/win for the agency, for the community, for san francisco, and four our

neighborhood. so, i just want to thank your staff. * i want to thank all of the planning department staff, the city attorney staff, but in particular the sfmta staff who have worked diligently for many, many months and around the clock since last year to make the pagoda option a near reality. i want to take a moment to thank director reiskin and john funge for their participation in community meetings. [speaker not understood] and john baptiste for leading the negotiations and helping to keep on track the overall process. i also know there are a lot of city staffers who have been here who have really been working hard to get us to where we need to go. and also i want to take a moment and thank the owner of the pagoda theater, the pagoda campos and his team for the work we've done together. i know we're not completely at the end of this and this has been not the easiest discussion and set of negotiations, but with the feedback from the community, with the feedback

from all the lawyers, planners, transit advocates, and all of you, i think we've gotten this to a much better place. so, thank you for that work. my staff i know will be here during this discussion to hear from additional feedback. i know that there have been a lot of questions that continue to be raised and i know that sfmta has circulated some written comments to answer those questions, but i gather that there will probably be more information and questions that come up and i look forward to working with all of you to answer them and hopefully move this to the process and get this going and get this on the right track. so, again, thank you for all your work. >> thank you, president chiu. we wouldn't be here without you and your leadership and office's leadership. thank you. >> i should take a moment and thank my staffer judson true who has probably spent about half of his time since december working on this. thank you for working with him in moving this forward. >> thank you, president chiu. director reiskin? >> yes. so, mr. chair, i think we've given you updates on this topic

in the last couple meetings. so, we're here where we hoped we would be after you gave us direction in early december to pursue this option as a preferable one upon hearing the concerns of the community from the current approved plan which is to remove the tunnel boring machines from columbus avenue. as the supervisor said, and you're correct in saying, if it weren't for his leadership and the leadership of mayor lee, we wouldn't have gotten this done. it really took the city family coming together and the personal involvement of president chiu and mayor lee. so, very grateful that we are all able to come together. as he he also said, it wasn't just the mta staff, but planning department, city attorney's office. we had the economic development folks involved, the building inspection, really everybody coming together in a pretty extraordinary way and under an extraordinary timeline. so, what we're happy to be bringing to you, a proposed lease that we were close to

having done in time for last meeting, have now since gotten done. didn't want to bring it to you until it was signed by the other party, and until the initial planning commission approvals or the planning commission approvals were in place, which we secured last thursday in this room that they approved i think three different pieces of legislation. and the special use district they approved will advance to the board of supervisors, land use committee this coming monday. so, we're well positioned now for consideration of this lease. the basic terms of the lease are i think summarized well in the report. there is two years of rent. it's a two-year lease with a $400,000 annual lease payment for just the occupation of the site. there is $450,000 reimbursement cap set in place for out of

pocket costs that the owner has while we're in this process. and this, with all the other items, are only on a reimbursement basis and only with our approval. we can't reasonably uphold our approval, but any costs that he incurs that we can validate, we would pay up to these caps, but not beyond and not things that we can't validate. so, there's $450,000 cap for his out-of-pocket expenses. there's an allowance of up to $1.5 million for construction escalation costs. so, that's basically the fact that if -- to the extent that if he were to go out today and build his approved project, that same project may be more expensive in the future just because of the cost of inflation. so, we're agreeing to hold him to keep him whole in that regard up to a cap of $1.5

million. there is also a cost he will incur once we're done with the site. what we'll do is go in, demolish the building, excavate and build our shaft. we'll remove the tunnel boring machines, and then we'll leave. what we will leave him with is removing the top portion of our shaft and backfilling some of that space and we've provided an allowance of up to $400,000 for that activity to get him back to a place where he he can then advance his project. so, the sum total of those is $3.15 million. that again is an upper limit. the 400,000 per year is fixed. the balance are allowances to be verified. in addition, we have estimated that our costs to change the current approved contract and project, the additional design cost, the additional construction costs, would be on the order of $6 million or the maximum of $ million. so, what we're asking you for

in this item is the authorization, both for the lease, the $3.15 million max of the lease, up to $6 million additional construction costs, which are basically the costs of the additional tunneling, the design changes we have to make, and the cost of building the new excavation shaft less some of the costs that we'll save from not excavating where we currently planned. * $6 million so, that's the item before you. as the board president referenced, there have been various concerns by various members of the community, surrounding various aspects about this. i think there's one category of folks who have consistently not supported the general project and they've raised a number of concerns that we have been able to address in writing and i sent you a copy of that last wednesday night. there are i think some very legitimate concerns of the

immediately abutting property owners. now that we're not on the public right-of-way, the impact, construction impact to the great majority of north beach residents and merchants is very, very small, but the people who are directly abutting the site, you know, they will be abutting a construction site, as it would have been whether or not we came there presuming this project would go forward, but they will additionally have the impacts of our project. we'll be working closely with them, with the office of economic and work force development to make sure that we're not doing anything that jeopardizes their businesses or other activities. i think i guess we can wait for public comment to address any other concerns, but that's where we are. we've got virtually all of our approvals in place. we still need fta certification that we have our federal environmental clearance. we've been working with them all through this process.

they've been at the table from the start. so, we expect to be able to secure that. and then with the final action of the board of supervisors once that special use district goes into law, we'll be able to move forward with the demolition of the building starting within the next couple of months so that we can keep our original timeline, which you'll recall that was to have the shaft built in time for the tunnel boring machines which are set to arrive about 12 to 15 months from now in north beach. so, that i think summarizes what we have before you. i just want to thank the many staff and the mayor and the board president for their work to get this done, and happy to take questions either now or after public comment. >> we can certainly ask members of the public to come forward at this point. do we have some names? >> yes, for item 11 greg gi

ber, howard wong [speaker not understood]. those are the first three. >> good afternoon, sir. good afternoon. thank you for allowing me to speak here. just now and again at the january public meeting on north beach, director reiskin assured us that this boring site, this would only be for the removal of the tunnel boring machines. with that restriction, i support this project, but really only as the better of two not so attractive options. i don't think it's particularly difficult for one to figure out that the economics of taking this thing out of north beach versus the more traditional methods of backing the machine out, bearing, cutting the heads up and pulling them out. it's kind of strange here. the real question is why is this being done. i don't think removal of the

equipment is really the issue at hand. what's really the issue and we're all concerned with is how do we get an extension of these subway tunnels into north beach as sort of potential down payment, for lack of a better term, down payment for extension of this subway into north beach and into fisherman's wharf. this board has made it clear, the mta made it clear in its public statements this is something it wants to do. at least one board member said so at the last meeting. the problem is how do you do that when you don't have the funding? you are not funded to extend these subway tunnels beyond chinatown. you know that. if you take a look at the december 8th -- pardon me, the 2008 approval, it said that this tunnel into north beach is for, and it says, this is a temporary construction tunnel for use in extraction of the tunnel boring machines. if you look at [speaker not

understood]. if you look at the secretary of transportation's report for fiscal year 2010 on this project, there is a map in it. it shows nothing beyond chinatown. there's no mention of this continuation. >> thank you, sir. next speaker, please. >> howard wong followed by joan wood and then lance carn, s. >> good afternoon, mr. wood. howard wong with muni.com. a supplemental letter from our attorneys libby [speaker not understood], were delivered later. * i'm providing three additional copies for your reference. as described in the three legal letters dated february 5th, february 14th, and february 19th, the pagoda theater requires a supplemental e-i-r and there are legal requirements for the special use district and continual

conditional use authorization before the lease should be authorized. save muni's goal in this regard is only to protect all of the north beach businesses that could be affected because the pagoda lease does not affect -- does not change the fact that some businesses will be possibly put out of business. as an architect, i have worked on many complex projects for the city and in particular the letter from the geotechnical engineer, lawrence carp who is very highly regarded does have very substantive merit. the groundwater being 6 to 8 feet below the street, foundations of adjacent buildings, some which are historic, no more than 10 feet below grade. a retrieval box that is 42 feet plus below grade indicates that

there is hydrostatic pressures and concerns about its impacts on structures nearby as we've seen in many projects which have been engineered with also the best engineers in the world. lawrence carp's geotechnical letter has -- all had i letters have been stamped and signed. the mta has not responded with an equivalent stamp. they're signed engineering rebuttal to his concerns and our concerns. >> thank you, mr. bong. -- wong. >> joan wood, lance carnes, and mark bruno. those are the last three people who have turned in speaker cards. >> good afternoon, ms. woods. yes, good afternoon. my name is joan wood i have i willedv continuously in north beach since 1962. * i have many objections. i formerly worked for the city 32 years. one of the conditions of employment there was that you acknowledge the public trust.

all of you and director reiskin and manager funge, you're all subject to that. i don't know why it seems to have been ignored in the interest of the central subway. i draw your attention to the e-i-r which was whipped out in a very short period of time. it says the construction will take 15 months for this project if it goes forward, the pagoda palace. there has been no consideration whatever of the historic buildings surrounding it and it's only going to put two restaurants out of business instead of probably a whole lot more in the previous plan. north beach residents and businesses got excited about the new plan because they realized that the pagoda palace, which is considered an eyesore, i'm kind of used to it by now, is going to be demolished. and i think the owner of that property and his lawyers and his expediter are over the moon about getting all this monday and i getting the building demolished.

i will just ask you why you haven't considered this destructive e-i-r. also, if you sign this lease, the property owner is getting a lot of his work done by the city plus getting this large payment. i totaled up the figures. it looks like you're spending $18 million in total for this by signing the lease today. i'm asking where the funds are coming from. i was told -- we were told previously in another earlier meeting, maybe the planning commission, you're going to use reserve funds. i didn't know they existed. many of us didn't know they existed. why are you not using contingency funds? there are a lot of funds in that and we want one more community meeting. a fire alarm went off and can you tell us short before. we'd like answers to many questions. thank you. >> thank you. >> lance carnes followed by mark bruno. those are the last two people who have submitted a speaker

card. >> good afternoon. hi, good afternoon. my name is lance carnes, i'm a resident of north beach. i guess i wanted to make a pointed to about taking care of our neighborhoods. you know, we're certainly going to be in a situation of putting up with a lot of construction without any real benefit to the neighborhood, a station or service. i'd like to start off and echo what the previous speaker said and that is we had a meeting in january 22nd which was unfortunately terminated before a lot of people traveled some distance in fact, to get there, were able to ask questions or get answers. and i'd like you to reschedule that as soon as possible. it's nice to come down here and visit you folks at city hall, but little two-minute sound bytes. much better to have a forum where we can ask questions and get answers.

last thursday at the planning commission meeting, it what noted that the owner of the pagoda site is to be compensated generously for the delay in his development plans while the extraction project proceeds. there is no mention to compensation to the nearby businesses particularly piazza pelegrini and [speaker not understood] sushi [speaker not understood] the pagoda site. further, the restaurants will be affected during the america's cup races [speaker not understood] their highest income probably for the year, maybe a couple years. so, i'd just like to once again, you know, request that mta come to our neighborhood, tell us exactly what they're going to do with this site, how long the construction is going to take, what hours of the day

will be affected, how much dust, whatnot, will be raised. we welcome you as soon as you can make it. thanks. >> last speaker, mark bruno. >> good afternoon, mr. bruno. good afternoon. easier when you're 15 to do this. so, my name is mark bruno. i live in north beach and i've been involved with the subway project for the last year. as you know, because you approved the original eis, e-i-r, one of the considerations was possibly leaving the machinery under the ground. i advised you at the last time we had a chance t