and the last thing that we do is create the value for the money study. and in the whole life, or in the construction depending on what method we have, we can compare one method to the other and delivering it a, to z, and what we do and what you find and that is why the risk is so important is to understand, what you are transferring and how you are transferring it, and we are fortunate because we have the transactions that we can pull from and so that we are not recreating that we own a lot of cases if you do get, for example,, you know, the dbfm to work and it actually says that this is cheaper than traditional, by traditionally in the neighborhood of 5 to ten percent, and you say, that is generating value for money for me, and that would make sense to examine that to the fullest. and this is just an example and this is taken from another project and so don't, it is not mapped in any way against this project. and but we would like to sit down with all of the stake holders and the board and what

are your goals and objectives, i called this as a consumer reports and kind of easy to understand, the public can understand it as well. each one of those methods measured against those goals and objective and where it sitses, where you will get the solid fwox you will get the strongest and you are achieving the most amount of objectives helps you then get a tangent and not just the numbers but the human aspect and the real aspect of this delivery method and these are two things that we would say we would recommend for you to say go forward with this kind of analysis and you become more informed of what it will be and how it could work, and with that i will stop and i will be happy to answer any questions that you may have. >> thank you. >> we do actually appreciate the speed. eny know. >> but it was a lot of information, so i do appreciate that. >> why don't we start with,

just it is a question, and it is, it is probably something to be studied, but curious if you had initial thoughts? >> so, with dtx, connecting with the cal train system. which it appears that it will be electrified before dtx happens and so the board has made a decision for it to be designed build. a few months back. and i am curious with the concept of the availability approach and then the dbfm, and you know, how does, how does that, how does the maintenance and coordination work in the repayments, and i am curious as to your, again, your initial thoughts because i know that we have to talk it through. and you know if it makes sense to isolate segments of the

whole corridor to support the approach, verses is this something that then requires some level of coordination or commitment for the rest of the quarter? >> yes. let me maybe explain this and i hope that this answers the question, and if it does i will elaborate more, the availability payment let me start with the maintenance first and it makes the three components and that is what makes it important to understand, one it is the routine maintenance and the second part of it is the asset preservation, and the third thing that is important is what we call the expiree, criteria, you do not let any of those three go, there is a payment mechanism and the criteria that i just spoke of in the routine and are mapped to what we called non-conformance points if you don't and you are not keeping it open and available, that is where you will get the dings and your money comes down.

and the coordination now, you talk about with, you know, lt cs and the overhead system and everything. and this will be part of that and it will be criteria that has to be maintained and sag, and the apology and the amount that have you to have and the reliability of that. and we have to be spelled out, up front and so, you, it is more advantageous for you as an owner if you go to the dbfm route to have one entity be responsible for the entire footprint, because when something breaks down you go to one source and they will have the specialists and smf the best in the world to do this to fix that problem as opposed to having individual contracts. does that answer your question?

>> from 4th and king there is a dtx and unless that changes, the cal train joint powers authority is a different public body than we are. they are running the trains are you saying 245 that there would be a separate owner and contract for the last half mile of the train line than from fourth and king to kill g*il roy? >> no, so they are going to switch from design build to dbfm. >> i don't believe that is what you are saying >> help me out, somebody. >> so, george, the director lee, is represents the cal train joint powers board that oversees, the cal train system

from gill roy to san francisco. and directors and the cal train board of directors last fall approved a particular delivery method for cal train electrickfiation, what they arrived was a design build approach. and we, of course, are not there yet and we are still investigating different methods and we are trying to fund the cal train extension and our jurisdiction is just from currently fourth and king to the transit center. it is expected to be completed in 2019 which will be earlier than we expect complete our downtown extension and at the earliest i think that we had it in 2022 or 24 and after the electrickfiation is done in 2019. and so, that is the context. and so director lee was asking about director lee now that i gave him the context, if you could request the question

again. >> okay, so, don't feel pressure to have an answer, and i, i think that it is a complicated matter that we will have to think through very hopefully. is with our design build approach and if we develop our contractor prokurments over the next year, we will be contemplating what to do with the m, it is not a dbfm, but it is a db and we are not only contemplating. and it was already contracted out and so my challenge or the complexity here is the dpx, and and it does not have the utility in terms of the operations and maintenance, it is hooked to cal train and we have two separate entities so when we make a deal like this, whether we like it or not, are married and so, i want to understand the implications as

to, and i think that we are still doing this and charming the feesbility of it and if there was enough merit to try to understand that complexity and how that ties in or does not tie-in. >> and i apologize and i understand the question better now. and sorry for the confusion, that i had. but it is a very important one. and it is really where the lines of response kind of seize or continue through and there are ways to do that. when we did ottowa we had a situation where the main one, and the stop line, right? that was run by the city, if you would and the yard was run by the private entity but the shops were run by the city and then when you get on the main line it was city operations, that did that and one of the things that was talked about was if you tied into the line and not that this matters which is the electrified lines of canada, is could you have the same operator and maintainer there. run the ottowa system.

and one thing that would need to be looked at. and from the standpoint, do you as cal train maintain through the dtx it would be something to study and all of the risks as well as a cloth to balance and i don't have a true answer and i can tell you that where in the past we have made those slice and those delineations to make sure that we eliminate the confusion and the lines of what is responsible for party a or b and whatever way we want to do that can be done, the industry can handle that very well. by, as long as we are clear in saying that i want you to take care of that. >> and if i could, i think that i just need to ask the board members really. and if the study moves forward with the feesbility, it seems like there should be a component where it is more of a

agency owners dialogue or discussion about what types arrangements make sense so that it could feed in, or provide a framework. >> absolutely. >> for the feesbility study because it is more of an owner's discussion, i think. >> right. >> and it needs to be a big part of that almost, pre, prep3. >> sure. >> assessment. >> one of the things that we do which may help you is that we like to do a governorans document, whether it is p3 or whatever because that itself, talks to the heart of what you are asking, who is going to be managing what aspects of it. and to what degree. and that then, helps us launch forward, with our stud j and be able to evaluate, and so i think that would be a recommendation that i would make to the board so appropriately, if that would help you then to say, okay, who is doing what is how do we want to do it and to what degree. >> thank you.

>> and i think that just a follow up with both director metcalf and director lee, i am curious and this is not a question for you this is more for the staff and maybe, something that i would suggest. as we look at the p3 and the design build maintenance and the build maintenance evaluation, i do think that it is important for us to evaluate the pros and cons of combining dtx with cal train electrickfiation and of course, having that discussion with the agency, and what it will take to make that happen. as we continue on, because i think that there are two very complicated because also, very important and high value projects. and those agencies are considering and while, their time lines might not exactly match, i think that it is worthy of that discussion. director reiskin is and then harper. >> yeah. thank you, and thank you for bringing this forward, and i think that this is absolutely the discussion that we need to

be having. and i think that this presentation was extremely helpful. and it is very, very grateful for how you laid this out and walked through, and i think that the direction that is generally, i mean, the way that we want to go, but the exact same question and just to we discussed this a little bit last time and you have got, one system coming up to fourth and king and another one continuing, this is not, a stand alone, asset that we are talking about. which i think would be a major consideration. and in evaluating the delivery method, particularly when we are talking about the long term, and then, when you bring in, the m, or the oand m, you are really bringing in the long term and i think that what this discussion has done is it really starts to surface that the larger governorans question and so i am glad to hear that evaluating the governor nans is part of that and i don't think that is something that we as tjpa can do by ourselves and i think that it has to be done

with the cal train, joint powers forward and so that will need be to a joint exercise exploring up to perhaps, what the chair has suggested as maybe at some point these things need to, and that there are physically together and maybe governor ans wise and maybe delivery wise and i think that now is the time to start looking at that and so i very strongly, support that. that stream of work and analysis, and discussion between at least the two boards, if not, others that i don't know, where if the mtc or other kind of regional bodies might have a role in helping this. and i was also, wondering whether we see a role for fta and fra in advising through their pmos, on maybe not so much on governor ans, but at least on the delivery method part and be even between from

the design build to cma risk and to design build and kind of maybe leaving from design build off to the governor ans discussion and i am wondering if we see the potential value in the pmos or otherwise. >> yeah, the fra and fta have guidelines and they have not done a lot of pthree to get to the extreme and i don't know if they have done it, and they have done the design build work that i am aware of and it has been more of the traditional than anything else director. so, i think that because they are a vital partners you will, and there is going to be some of what i called the strings shs and that are attached and we want to make sure that we are partners with them and so when you talk about talking to the two boards, i think that that is right but also, your other funding partners as well and because, it is collaborativive as you make it early and get all of those agreements then the industry, itself understands that the public understands it and just eliminates a lot of confusion. >> yeah, i think that there will be a lot of benefit in

that and in terms of the evaluation some of the existing projects it seems like it women be premature to call them a success or not. if they are not even build or let alone were a benefit accrue over many years it might be a little bit premature, i think that it was great the way that you laid that out. and then, i guess, the kind of the process, question, whereas you said, already more or less of 30 percent we should have our environmental done this year, but, what are you thinking in terms of the decision making time line? well, that is why we wanted to bring this first discussion to the board. and because, chair person kim is absolutely correct, that the discussion with cal train and we have been in discussions with them and high speed rail is critical, because we are not a stand alone project. we are connected to the downtown extension and we want

to work with them and joint partner with them and we have had these discussions with the san francisco ta. and they certainly have expressed that they concur that we need to be working together. and so in terms of process, which is a question that i was going to ask for your guidance on and director lee and in particular, a representing cal train, we could start to start the discussion at the staff level as to how we go about working with george, and looking at this governorans question and we have a leasing agreement with transit for phase one of the transit center which addresses how we work with ac transit and you know, what the roles and responsibilities are and we are looking to have something simply with cal train and once we had it funded and another one with high speed rail which addressed things like who is going to be responsible for maintenance and operation and what was going to be their share of why did the passenger facility charge to help with the maintenance and operation,

and we had it fully funded and with your on governorans and our director lee has a different suggestion and i am happy to defer to the cal train on this. >> but i think that it is good. and i didn't know that the time was going to be today. >> and and i think that it is good. and in a key agency we should bring in is, the high speed rail authority and we have not yet had our own governorans discussions with us yet because they are busy in the central valley. and whatever discussions that we make, it has got to be linked with it from the high speed rail. and i think that it would be, and i think that the three agencies should get together. and at least that staff level get that discussion started.

and the other thing that i wanted to offer up just so that i am transparent and we are and the jpb is supportive of making dtx happen as soon as possible. and as well as really the nine or the nine agencies that assigned the cal train early investment program and the electrickfiation program and you if you look at that document, being not only scraped up every dollar for the first incremental program but they signed up for being the advocates for the rest of the system to the high priority to the project and so there were nine agencies that are invested in the out come and the expediting the dtx project as well as high speed rail and without a doubt because they don't have a landing they are not landing a fourth and king and going straight to the ttc,

and so i think that the three core may be a good start and the rest of the nine is probably appropriate, and then, some i am sure that it is the whole world. >> and then, the other thing that i did want to offer up to the group, and the cal train staff i don't think that has been here for a long time and i am not sure that the last time that they were here, and i am not sure with the board meetings and if it makes sense for maybe cal train to come with high speed rail and to layout for you to sort of where we are at with the program, and i will tell you what makes the gpb nervous about this partnership which we have to explore. and it is not so much that the partnership, we think the closer partnership and the more integrated partnership is bad

and we are obsessed with delivering the electrified service. >> and whatever ideas wants to come out, and we want to be fulfill that commitment and it does not get delayed as any typical agency would worry about. and it would be happy to come and sort of layout for you our key milestones that we are trying to strive for and we will explore the integrated partnership to meet the sort term goals and the longer term think and on this project as well as the blended system ultimately happening later. >> and it was part of the request or the discussion with director cap len is to have on the cal train and the high speed rail and of course, the san francisco planning department and at various points to understand, >> thank you director. and i will agendaize with the chair person's concur ans a presentation by cal train and

defer to you as well and if you want high speed to rail and joinly present to the board all of the work that you have done because i know that a lot has been done and is being done and it is all integrated and connected to what we are doing and it would be good to hear from cal train, and so again, that has been done for february. >> did you have more? >> i just want to a discussion about it at some point and i think that you said, and we are going to start in the roles and responsibilities and we would need to do that quite a bit sooner, and a concept of operations for phase two as you are starting to develop from phase one. and is something along with the respectful of main nens responsibility is kind of needs to proceed, the delivery discussion if we are going to come mri plate an m, as one of the options and that would need to happen quite a bit sooner and i would urge that i hear the concern and nobody wants to

slow down the electrickfiation but i do think that it is time, to bring all of these and to bring at least the three streams together for discussion and particularly for both con settlement of operations and governorans which will inform each other. >> and so what we will do is we will have the discussion at the staff level with cal train as well as high speed rail on the governorans component, maintenance and operations, and there are suggested that the o, part should be one and you should have one operate forethe entire rail and the dtx component. and we will have it at least on the staff level and i don't, we don't have funding right now, for that. but we will work with the ta for their suggestions and comments on how maybe we can, if we are going to need to do an extensive study or what that stud j entails i am not too shir, but we will at least have the preliminary discussion. >> not just on the o, and the m, but the b as well. >> absolutely.

which we have been having those discussions but yes. >> director harper? >> yeah, i will be brief, because i just would echo what has been said, the governorans level is the big deal and getting enough altitude up to see the big picture. is what needs to be done, early and quickly, so that we can figure out if it is politically possible to pull this off. because those of us in the transit business until we get to the mand o, you are not into the pain and the busts that we go through, and so it would be, and i like this idea, when you can start adding your letters, out there. because it and then you are talking about some of the really can say, well we have got to make money down nr there and so we have to do this here. and the other, the only other thing that i would throw into this which is kind of minor is that of course, in all of these p3 scenario and close to it,

the horror is bankruptcy, what kind of entity are you dealing with? what are the guarantees that entity and what happens? upon trouble, big trouble and dissolution and so the question that i would have for succeeding presentation is i would be interested in how smf these things are bonded. >> yeah, and that is where the equity comes in. and director. where we are asking for them to do is their equity money would be the first money in and the last money out. so valvebility that you are seeing the fault that you have been speaking is on concessions and because they don't make enough revenue because they are relying on it and they default and on the availability payment you are entering much more into a service agreement, okay? and so you don't see the default there and you may have a lender default and that is not because of the transaction and i will give you, when is the parkway and not that this matters too much. but, that is the bank that is a

greek bank defaulted on ten million dollars of the equity. and the other investers picked that up quickly, and that was part of 2008, 2009 financial collapse and what happeneds in greece. and so that is the extend to what you see on the availability payments and the guarantees and a lot that we go through on the rfq basis and so the rfq we pretty much focus on technical, part a and part b is financial and legal and we actually lift and we have them, we are heavy defaulted to the default and all that have stuff is tested and measured and so when you pick the three teams or the four teams you are getting the people who have a very long storied track record, maybe it is not here maybe it is in canada or in europe and, there has not been default and so you use that to test exactly what your concerns are, it does not mean that it will not happen, there is part, and there is the rfp will have contractual language and that

is why the contract and we killed the trees and the contract has to be quite big because we seek exactly those protections, as an owner, and that in case there is a problem. and that, they are stuff in the rights and there are different kinds of contractual mechanisms that they can make themselves, repair themselves and one of their lenders went bad and they could put someone else in equal capability and so that you don't have the massive collapse and that is where they have been better. >> and there has not been one of these to date. >> there are not in these cases big internationals that bond the whole thing? >> no there may be one entity, for the sosha bank there were 1300 lenders underneath them and there may be one that you see that is the bank, but there are subsets to this in that transparent and it is not like you don't know who they are and they are not guys in the bushes, you know who they are and yet that is all laid out and so you know exactly what the equity is to greet and the responsibility.

and it is a very transparent process from that standpoint and you will know. >> i really appreciate this discussion, that we have been having today, really constructive and exactly what we should be talking about. just my two cents on this as a close observer of doyle drive and the prosido parkway my bias is to feel favorable about the availability payment and the design build finance maintain, i think you know, i hope, i hope that we can work something, like that out. and i do think that the question about the structure of the agreement, between the cal train jpa and the transbay jpb is the whole question, at this point, the d, is being done by this agency. and hopefully, with complete input in concur ans with cal train.

and i trust that that is okay. and as we get into the other end of the operate and maintain, and it is very clear to me that the operation of the rail service in the main nens of the rail line is going to have to be one entity, there is a clear line at the terminal. and there can be a different entity to prepare and operatele terminal itself. and as we get into the builds though there are interesting questions and i would really like to understand the options and other kinds of deeper coordination and in general i like the structure of your report today where you are giving us all of the options and i want to see that carried through in the analysis of the government options and the maintenance options and that we have time to have the staff recommendation, or if we see the options fully explored. >> and i appreciate that and

until you get the right answer, you ought to look at all of the they are and from a public standpoint and a director's standpoint and all of the stake holers because you are not making any preconceived notion and these are the options, and if i could, embellish, the one example that i had, and of the consumer reports and i did one similar, and this is the way to go, they decided not to go that way for other reasons, and that is the reason that they went in that and that is because they put everything out in front of them because it hit the comfort zone because that is where we want to be because if i could share the story of long beach and assume that we did not talk about what was, and what was the availability going to be? and that was kind of just not really out there and so when it came and they saw the 60 million and they are like, what? it was not transparent enough

and so i think that it is important to us as we report to you to be as transparent on those aspects as possible. >> thank you, director? >> yeah, i too want to thank, this is very timely discussion about the approach to how to deliver this portion of the project and a good presentation. i would say something that having respond to the questions that were raised and that would be a proposal that would come out. and i told you that the second part was under the availability payment is the gaurantor of that availability and on the drive example that was mentioned this is the california is the gaurantor and i think that we need to find one out for this and without that there will not be any developer that would be putting coming forward for a proposal. >> and if it is not a question