a cost of roughly $44 million which was considered in preparing the february recommendation. so in terms of the schedule and the steel schedule again is rebinged or bringing the cast notes forward for the regard was the first steps in the impact of the bid. web core is working with the contractors to keep that on schedule so it can start as anticipated. and the web core again working with our scheduleers on the program management and the turner staff have identified ways in the schedule to break the dependent sister like

allowing the shop system to start before the steel erection is complete and get out earlier. so that we can create more overlap between trade packages and not as more finish to start independencie independencies. we're going to continue to work with web copper to build more structure into the package so we can address those and keep the work on schedule of 2017. those are the current milestones as we present in february and currently most of them are the same. there's a couple of of them in the middle with the completion

and the blow grade construction where we're lagged things but i mentioned in the process of the steel erection we're able to recoup that and keep the project on schedule. the budget assessment as maria mentioned we've previously done on multiple occasions working with the associates to identify budget based on the availability and scheduling we worked this time with the consultant web to do a risk assessment. again, the objective here is to assess the resources moving forward. and we have as maria mentioned

presented those finding last year to the transportation authority and other funding partners. we do follow two processes the first is referred to as a top down approach which follows the fta which is a process which assigns what are called risk factors to various components of the project construction. we'll talk about that a little bit more and the second a bottom-up approach which assesses the risk moving forward. generating one kind of a more objective and one slightly more subjective process. but to a have two checks.

so the first step in both processes it so calculate what's called a strip based estimate it take our former budget it takes out out contingencys for program resources and changes and adds to that additional costs for identified trends estimates from known costs like the steel he results and the recommended changes to calculate a base cost estimate for the purposes of the further analysis to project the contingency. the second step is to identify the risks that the team is aware of that the project is

potentially exposed to. in this effort we're trying to look at the large and unique risks not every potential risk that could happen but those who have the greatest impact to the project. we working with again gardner and the other partner this is a contractor and oversight team program oversight team we identified our thour 34 most significant risks after they were weighed for probability and impact were categorized as high, memoranda or low risks and 40 of them being high. at this point is when we take

those inputs and put those into the models. as i mentioned the approach identifies a beta factor. each element of the program which represents a assessment of the risks associated with that scope. and you see here a graph that the further a package is the lower the beta factor it's supposed to have and the higher beta fact is here. based on the design of the front and when the packages will be bid over the remaining duration of the project the construction

was assessed. in the bottom up approach there's more a quantity active approach looking specifically at the design status of each scope the change order, potential for each scope, the potential of each scope to have conflicts with other trade packages that might result in plains as well as the prospective number of bidders. we expect to get 3 bids we feel like we could get more bids that would have a slightly less risk associated with it. if there's a one bid that would have a high-risk associated with that package. so running the inputs through those two separate approaches

this is the direction of probable outcomes there were generated by each approach. in the 50 percent level the bottom-up approach generated a budget of $21.29 million and the fta approach which is a typically more conservative approach it relies on the objective assessments of the project team that are facilitator saying are often optimistic but it would be $888 million. using that and putting that in with the - and that was it table

is actual with the bid results run through the analysis so this reflects the 189 billed as given rather than an unknown. so based on that we continue to recommend increase in the budget to allow for the rb a guidance criteria and the market conditions we see going forward. increasing the continuouss and resources we say the angina contingency and the program resources to a combined total of $229 million which is sxhvent with the risk evaluation.

that includes the construction contingency on the remaining construction and an 18 percent on the two be comment budget review. as well as the same adjustments in program wide costs that we recommended in february. so you see here a breakdown of the various contingent pots design contingency escalation. so they're in the within respective construction budgets so portions of that are in the transit center the bus ramp construction item and the bus storm and the program resources which s alone as a separate

recommendation. so this is the current budget we would recommended which is a budget of roughly 1 hundred 9 billion 4 hundred thousand. and the breakdown of that cross the construction and other categories. and that total adjustment and the components that it falls into the r va costs again are almost $57 million and the market recovery as we discussed in february of $55 million the actual still bid result represented an increase of $44 million and the other construction costs that's actually down slightly due to some work with the design team

and web core since february of $5 million of program and soft costs of the thai million dollars and increased contingency and reserves of $15 million. we also when we presented in february and march we identified some new revenues of just over $50 million. we actually have significantly greater amount of revenue that's identified to this point. i'll talk about that as part of the revenue plan for the proposed budget. so the increased land sales value is $53 million this was carried in the february presentation and it represents the recovery that we've seen

the market on the land sale side of things above the previous project of lands sales. the transit center plan includes about $37 million in mellow reduce and open space fees for the park as a use of those revenues. there's transit tower did get in 8 and a half million in kind of retribution but it leaves about 28 in the district plan reviews to help with the park. additional prop k funds. the transportation authority has gone through the process of reassessing the interest expenses they've had over the

last several years and have come to the conclusion that the actual interest costs incurred on escalating the transit center has commented substantially lower amount of that funding so based on the current borrowing of values to date we have roughly $4 million within the half kent sales tax san francisco sales tax program. this is a significant benefit to the project to phase one. in addition to the grant program we have an explanation if in for a $12 million grant for bicycle and pedestrian program within the district.

we ultimately received an award of $6 million through the feedback program. those programs net $18.2 million in r tip funds that will not be available in the phase one timeframe is a net of $10 million to the program. which leaving us with the budget change of an additional revenue remit of roughly $2 million. as we discuss in february and march we proposed to take the loan back to mainstreamed to adjust the interest rate and the coverage radio that will generate between 97 and a $100 million in all revenue. we also have actually applications in for a tiger 5

grant based on the scope of project for 8 pointed $23 million and a grant in for 3 and a half $6.2 million that is based on the enhancement of structural connections coming out of the rb a possess. we're going to continue to pursue other federal government grant programs and local and regional support communication with the transportation authority with m t c on bridging the rest of the gap. as we mentioned in peanut butter february there's a potential to borrow some funding from escalating the land sales by based on the timing of those funds and the restriction to funding the hard costs that's not a stand alone solution

remain for funding. with that our next steps we'll be bringing back up budget representations to the board for action on july 11th. along with recommendation to award the structural steel package where brian will have an evaluation on that bid and we will have a rating in order to move the application process forward. and then we'll also be putting out the bus ramp package in july as i mentioned earlier. >> before i ask fred to come up are there any questions from the presentation? >> yeah, and thank you for a

good presentation obviously a good good deal of work is going into this. one is to clarify that that i was having trouble following the numbers could you walk through what the original estimate was. i know the first bid was 255 and what we're going to end up with when you take the cast notes plus remaining steel >> yes. the original estimate for the steel was roughly $120 million but as we prepared the original package for binged and brought it forward we increased the budget to $162 million. therapists reflecting the market

issues but also the fabrication of some of the larger beam and round column pieces. the ability to domestically fabricate those was effecting the prigs particularly the large beams. some of the beams were not rolled here so we had to go to domestic rolled up beam columns. so at the time that was reflected in the estimate was 1 hundred and 62 employed for the steel. obviously the bid was $162 million higher. at this point we split out the cast notes which were actually, the figure that was proposed by

bradykinesia as part of the original bid was below our engineers estimate for the cast notes that's where we took the budget of 1 hundred and 74 million and braug that to you many may for award. and then it was the remaining steel scope that we packaged and bid and received the bid of 1 hundred and 89. so if you're comparing things across the board you would add those together to come up with the 206. >> okay. thank you. and the low bidder on each of the 3 sections was the same firm? >> actually, the way it was stashed we took bids on each the

3 sections vildz and you could provide a bid for the act gait. it would not to be sum of 3. we had a situation where the low bidder on the individual section was, in fact, but the low bidder on the aggregate of the whole bid was another company and this was lower than the combination of the bids. >> well, it's relatively good news. i guess in the big picture of things we learned in the late winter are early spring we were off by $214 million now we're up to $10 million that's a 10

percent increase in the program which is pretty significant. and i appreciate there's been some work done to the tune of look likes a hundred and something million dollars we could have been looking at $400 million so that's great. it seems that the analysis from the february, march forward that the work has been based on the existing scope and focused on the mitigations are how do we increase costs or to what extent to we need to increase the costs if possible etc., the tint of scope reductions. you know, some d dots. so for example, the whole risk assessment was taking the existing scope and figuring out

and proportionally so what kinds of contingency. i think that analysis was good but it was all from the same baseline as opposed to looking what should we be reducing. i know we had talked about before what is scaleable and i think had some discussions. i don't know if there are other scope elements the park or other things that we should be thinking about. so i guess that's a general observation. and then a couple of specific questions. i'm wondering why the design and the program wide costs will be going up. given that the scope isn't

increasing and similarly the $54 million of marketing recovery how is that calculated. how much additional estimated costs do we have to bid out now, now that we've bought out a couple of big chunks and what's the distinction that and the 54 i don't remember the number of the escalation. so it seems we maybe over compensating for the budget side. on the revenue side it's great we've identified some revenues given we have a phase two

program that has a funding program that doesn't have an adequate one. to the extent what amount of revenue identified to plug in phase one gap could be available for phase two because we have an arguably bigger problem in phase two. on july 11th we're not going to have a budget balanced so what are we approving. i assume if we're going to approve a budget it would have to be balanced. i do appreciate all the work that's been done to deal with the dynamics here. >> we can respond to your

questions. but july 11th is critical. we need a budget a that's approved by the board to submit the final application to the team at fta. if we don't do that we're in trouble so safe will respond it that. ca what is it we're approving on july 11th >> sure traditionally the board has adopted the baseline budget on the expenditure side and you're not approving or adopting specific revenues. for example, when you adopted the 1 hundred 89 the money was not anticipated so there was not

an anticipated side of the baseline budget and staff continues to seek out revenues and revise the revenue plan >> okay. it's unusual for any organization to adopt only the expenditure side of a budget but. and we think that's going to be adequate for the rating agencies isn't it so because if we're not adopting the revenue side we can say the simple side is okay >> one important thing to remember this is looking at our ability to repay the debt and that's separate base it's based on the tax increment but we want to see the plan that we can fund

the budget. we won't be able to fund the budget until we have demonstrated a fully funded project >> which we won't have by july 11th. >> no, but we won't be speaking with them until late fall until the end of december so we have time to work with our funding partners to do so. but just so the board is assured we're not going to be drawing down on the loan. >> that's what we've done through the project. the center 11 million is a policy call does the board want to increase the revenues and contingency per the recommendation of the f r a and

fta. if we don't do that we have a fully funded phase process. but it would be prudent to increase the revenues and we'll be able to identify the funds. with respect to your questions on scope. we have to identify the mitigation measures as part of the risk assessment. we can include this in the budget. the event we decide to be prudent and accept the recommendations to accept the recommendations and contingency we could defer the bus storage although they sent me a letter asking me not to do that we have an active tiger 5 application for thatful in place now we could defer elements of the

park. as part of this approved budget. and with respect to all of the d ducks we presented that in the past we have a substantial amount of d ducks. we're asked to look at the for example, the skin it's too expensive we're recommending painted aluminum. there are some savings. there were some other questions you had in between those two >> i can expand on that. there were a few things within the estimates you touched on i think i captured most of them but feel free to ask me again. one thing i think - in terms of the scope of the project and the