started drilling holes yet, we have a gift for you from north beach called the north beach construction tunnel variance; that's going to cost you 70 million bucks which we will be happy not having it done. you can put this back into your budget and make up some of the budget shortfall and your time shortfall. i would like to encourage you to consider cutting that out of the central subproject. we are fine without it; you can use the money. thank you. >> next speaker please. who's that? >> joan wood, the last person. >> good afternoon ms. wood.

>> yes good afternoon, also the second time for me this month. i am a member of no north beach dig; i am concerned about the extreme speed that you are using to bail out a developer and do his work for him, you have the key ont he 16th, according to mr. fungi, so you must have paid what was coming to him. the dig at the other end is proceeding extremely slowly; the feds have noticed that and they sent you a letter this month, i'm sure you have seen it. san francisco weekly talked about it. the feds are concerned about serious deficiencies financial and in time; you are appointed

by the mayor, you are loyal to him and what he wants but i think you should take your responsibilities more seriously and really look into this because you cannot mess around for ever with the feds; they will come down on you if you don't do something about this. it is sort of insanity to be working on the end of the actual project and you can't progress on the front of it, down on 4th street. it's crazy. part of what the feds pointed out is that there are piles that have to be driven -- they have another word for it -- piles is as good a description as any and they can't get them straight, they are crooked. they have only done four, they are supposed to do 46. please take your responsibilities more seriously. mr. reiskin is overburdened

looking out for taxis and parking meters and all of that but it is your responsibility also. >> mary mcguire, last speaker. >> mary mcguire, taxi driver. i would like to thank mary borley and director reiskin. -- you are saying everything the industry want to say. you recommended the solution, to make sure that on regular that services will drive the regular providers out of business. --

also, you pointed out too that electronic hailing should not be exempt from regulation. regarding regulation, the hackers' code, better to ask for forgiveness than permission; if this will be the new way of the world, how can we regulate, govern, protect the public if this is how it's going to be? my request to you, my question is, these comments it is so excellent, are you prepared to act on them if the puc doesn't? i know it takes courage. i know, or i have heard or feel that mayor lee is not

going to be favorable to you if you do act, hopefully i am wrong, and he is highly influenced by the people from sand hill road. i want to ask to have the courage to act. >> chair nolan: next item. >> moving on to consent calendar. these are items considered routine, acted on a roll call. as previous stated 10.2 p q r and s have been removed; the rest of the consent calendar is before you. >> chair nolan: motion to approve? for the discussion, all those in favor? the ayes have it.

>> item 11. awarding contract 1300 -- station surface station surfacetrack - (reading item 11, regular calendar) >> chair nolan: mr. fungi? >> good afternoon, john fungi central subway program director. item 11 request to award contract no. 1300 to tutor perini

corporation and the amount not to exceed 839,676,400 and authorize the director of test addition to exercise 490,000 in optional work and further authorized director of transportation to prove up to 20 million dollars in contract amendments. contract 1300 presents the final contract award for the separate program under percent of the work for chinatown subway station, union station market street station, essentially everything to bring it into revenue service which is currently projected at the end - of december, 2018. under this contract that you will be reviewing today, is scheduled to be completed prior to april thirtieth of 2018.

central subject construction began in 2010, and it is scheduled to be completed in early 2018. the first two advanced utility relocation contract has been let and completed; preliminary work under the tunneling contract is not completed and tunneling is scheduled to commence on june 10 of this year. regarding contract 1300, on october first, 2012, the mta concluded that the money the remaining station packages to one contract, contract 1300, would reduce overall schedule and coordination and integration for the city. the program is also engaged since incorporation of contract 1300 the specialist services of small business of returns and one thing is concerned to encourage and assist sb anticipation and contract 1300. on april 18th, three minutes

were received, prices range from -- tutor perini operation of the lowest responsible bidder with it price approximately 12 percent over the engineers' estimate range. staff analysis indicates three factors that contributed to the final bid rise exceeding the engineers' estimate. the first is market conditions; current high demand for contractors in california essentially reducing the bid pool, contract completion scheduled is challenging, and site conditions. contract 1300 contains significant amount of similar work to that currently being performed under contract 1252 in the union square area, essentially a congested site with tight tolerances. sfmta central subway program

1300 will be funded by a combination of federal , state and local monies with approximately 25 percent of the base contract work to be awarded to small businesses, tutor perini exceeded the small business with dissipation goal and a minimum of 50 percent of trucking and hauling work for small businesses, invest a minimum of 1.5 million in hiring -- providing on-the-job training for construction management positions within the program working alongside with experienced tutor perini personnel. staff recommends that the sfmta board i subject to thetutor

perini corporation. >> the social economic advantage employment, 1.5 million, what does that mean? >> will be working with community based organizations that will screen potential candidates to perform a pre-apprenticeship program; essentially graduates from this program will be offered seats essentially in apprenticeship seats within the local trade unions. >> let's go through the nurse when you mentioned the, minority and disadvantaged businesses and all that. >> the small business participation goal for the program was amended at 20%. and tutor perini came in at 25% level, exceeding the goal by approximately 5 percent. >> of these local businesses?

>> california state small businesses. of the listed subcontractor for the contract, approximately a quarter of the businesses have addresses located in san francisco. >> and the minorities? >> the disadvantaged db, center enterprises, would be incorporated as part of the sbe umbrella, but i have not segregated out the list of sub contractors, db versus lbe. >> it seems like a huge project, an extraordinary opportunity to do something for small businesses in san francisco. whatever we can do to support that he ought to look into it very seriously. >> if i could clarify,

locally funded projects have a prohibition on locally geographic base preferences such after 14b of the city administrator code that provides for such preferences that we use for non-federally funded work is not applicable; we are not allowed to apply here. what we can do is set an sbe goal. which we have done. and with the contractor has exceeded. despite our efforts through meet and greets, berries outreach efforts in advance of the word, in advance of the bid, to connect local businesses with prospective bidders, the firm that won didn't have a

whole lot of san francisco firms on his team. the opportunities that remain, the public contract law says you have to list of the contractors that will do at least one half of one percent of the value of the contract, in this case a little more than four million dollars. for work subcontract below the level, there may still be opportunities and we can be encouraged and facilitate conversations and make sure the prime knows of the ability of local firms who by law we cannot compel them. >> i hope that they will respect the spirit of this. i understand the federal probation all that. i hope the contractor listens to this and does everything they can to make this is

representative of the seven cisco workforce as it possibly can. members of the board? >> one question. i noticed here mr. fungi, thank you, this includes the construction of the stations. my understanding is that the underground portion of the stations, the work that will go on about the stations whatever's going on above that, that is still sort of to be decided and awarded in the future? >> this is the balance of the work for the simple supper program; we have two small programs. the tone contract executed last year. it does include the aboveground portion at stockton in washington and fourth and

folsom to build the head houses of the station and union square. to the extent there is the desire to build up above where the stations head houses are, that will happen separately, it is not part of the 1.5 billion dollar program. >> the reader care of you care to speak to the comments suggesting that the federal funders are concerned about the pace at which we are going? >> i will give a short answer and john can fill in. for a project of this magnitude, the federal government engages consultant to provide oversight. they meet with us on a regular basis and issue varying

numbers of reports based on the analysis of the project including the large muscle report to which folks were referring to. the consultant engaged in the federal government is concerned that with the award of this contract will have schedule and cost contingencies below the level that they are comfortable with, that they would like for us to have. the execution of this contract award of this contract will not put us over budget or behind schedule; we'll just have less buffer. that is a situation we would rather not be in but given the state of the economy and the state of the project we still believe that this is the best going forward. in response to the vice chair's question this is the last conference we are looking down the cost and schedule for the rest of the project and we

don't have other work to be bid were other parts of the project with unknown budget or schedule. this is the last kind of unknown and locks it down. in a year or two we'll have caught back up to where we would like to be in terms of having adequate schedule and cost contingency. the concerns are valid but we believe we can manage the risk associated with a small contingency and feel that we can complete the project on schedule and on budget. >> by on schedule you mean revenue service in the end of 2018. >> revenue service at the beginning of 2019; special completion is 2018 that schedule has not changed. >> you're still confident we can meet that target. >> that's correct. >> and then,

it goes without saying i believe but we are now the point where we don't have further federal funding and agencies. i realize this is funded sort of as we go but this is locking it in such is that we will not be in a situation, that critics have complained, that we will have local money in an have the federal money pulled out. >> one more question in that vein. is this buffer unusual for large construction project like this, is it unusual for large infrastructure project of this size to have that scheduling and cost contingency buffer? >> not unusual for recent fta

project that had that level of cost contingency and schedule contingency; keep in mind that the report is a bit dated. there wasn't any cost certainty; the project was still going out to bid. this will essentially locked down and provide cost and schedule certainty. we will have a lot been completion date for this work prior to april; essentially the agency has approximately 9 months of start up and testing work to maintain revenue start up date in january. in about 18 months we will

have dramatically reduced our risk for both cost and schedule. >> thank you. >> is it safe to assume you folks are regularly meeting with the fta? >> thank you for the question. we work closely with the project oversight, pmos, who essentially wrote the report. we work in concert with them; they attend all of our meetings. what they are communicating is basically an action plan that we have internally. we made considerable headway; one of the comments was about the drilling work in union square. we have analyzed it and made recommendations. the contractor is actually in the process of and lamenting those recommendations in order to meet that schedule. in any construction enterprise, change is a constant. we need to be flexible.

the point is we need to aggressively look at concerns and challenges and address those concerns and move onto the next one because there will be others. we meet with them regularly. i personally meet with the pmo, the individual that wrote that report, at least three to four times a week. >> thank you. >> anybody else? in that case, members of the public who wish to address the board on this issue? >> julie choy, stanley chan and -- last speaker. >> good afternoon. >> chair nolan, board, director reiskin. i am president of the asian american contractors association, local businesses and construction industry all lbes. i'm here today to talk about the point that chair nolan brought up, the lack of participation of local san

francisco-based contractors. i went through my e-mail archives to see her respondents about this project. it goes back to 2008, there with me as i go through some of the e-mails that i found . in march 2008, sfmta started to reach local businesses and provide a network, in april 2008, the asian american architects and engineers, and the asian-american contractors association began to work with carter rohan and mr. fungi discuss this project to make sure local businesses get a part of this project. in september 2008, mr. fungi met with our association to discuss the opportunity to unbundling the project and our chance to participate .in 2008 there were more financial management seminars;

in 2009, the former president of our association sent a letter to nathaniel ford [sounds like] suggesting unbundling and making sure we get part of the action. forward to 2011, 2012, we had meet and greets with the potential bidders. and then in 2012 october the other shoe drops; we learned the package would be rebound the; we felt awash with the realization that this was not an average. we have a project that is low local participation. >> we have additional possibilities for local businesses? >> again,

the public contract code requires doing at least one half of one percent; to the extent that there is work to be done that is below that threshold, there is potential for the contractor to engage firms to do that work, roughly four million or less. i am not suggesting there is a whole lot of work out there outside of what has been listed in those very small, relative to the size of the contract, pieces but it is possible. >> you care to comment on that? >> yeah. we are going to have another member of our organization speak. with regards to that, again, we have found that there was one local contractor listed. non-minority.

very disappointing to our organization, our constituents and i hope it is disappointing to the board. we buy our lunches and pay our payroll taxes here; we have been engaged with mta for five years. thank you. >> stanley chan, followed by oren hellstrom [sounds like]. >> my name is stanley chan, president of value fire protection. we have been operating out of san francisco for 25 years. we have many projects in sfo, puc, parks and rec and so on. we are familiar with many agencies in san francisco. i want to share with you my very unpleasant and

outrageous experience with mta in my experience. to summarize our company was poised to become a second-tier subcontractor to a first-tier subcontractor. upon learning that our first tier got the job, two hours later they called us back to say tutor found a way to satisfy the sbe requirements him or somewhere else so they don't need us more. six months of work went down the drain; years of contact with the prime contractor went down the drain. this project is huge, 840

million dollars. i urge not to move forward for the following reasons. it sets a dangerous precedent to ignore chapter 14 lbe ordinance which many supervisors have supported. all other supervisors support it. two, it ignores the impact of the local economy that could be generated from participation in this. can i submit this? >> of course. we would be happy to see it. next speaker. >> good afternoon. >> good afternoon oren feldstrom --

the coalition is an umbrella group composed of numerous minority owned trade associations here in seven cisco such as the african american chamber of commerce, the asian-american contractors association and others. we have been working with many years to increase opportunities for smaller, local, minority owned firms the cities 14 lte program and the federal dbe program. local businesses and especially minority businesses are hurting. when the economy goes south it is our members who get first and hardest. we have had a number of our businesses over the last couple years just hanging on, downsizing, leaving the city or going out of business. that is why there was commenced excited about this project, 840

million dollar contract right in the heart of san francisco, what an opportunity to engage local and small minority owned businesses that is why to us it is unbelievable to us that this body is poised to award a contract of that size , that magnitude one of the largest ever in the city with virtually no local participation in the local minority business participation , we also think there are serious legal questions about whether or not this contractor working go forward. mr. chan just gave you his story; others that we have heard since we sent in our letter objecting to this concert the word racist serious questions about the good faith and fair dealing that this . rant contractor has been involved with we are not asking for local preferences. we are asking that this received the scrutiny that this deserves, but it gets sent back to muni's dbe contract compliance