letter of the process and went through the legal process to get authority to accept so there was not and at the budget and finance committee meeting for example on the 23 of october i was asked a question by supervisor avalos he had some reports of buzzes were in the bay area. >> >> and that in fact is true. i said "yes, the buses were all scheduled to be produced in 2013 and that new flyer was sending them to the bay area. they were sending them to alameda to a company ccw which they made arrangement to do work on the buses and part of that was their own decision that as they produced buses they had to move them -- i think for nothing

more than space limitations at the plant in minnesota, so the buses were -- some were some buss in the bay area prior to the notice to proceed but they were not in our possession. they were not our buses and it gets to the point, so it may seem like a fine point, but i appreciate the opportunity to explain it. on the rt question on 8711 part of all of the procurements and the 62 and the 50 it's our practice to have the buses driven by the plant. it is almost 2,000 miles or around 2,000-miles and that give us us an opportunity to debug or break in the buses and 10% of 50 is five so five buses broke down in route on the way to san francisco. my personal

preference is that it's better than they break down there and not after we have them in service and reveals the problems and we design them and get them here and with that particular bus that's what we did with all of the buses is have them driven. on the point of the maintenance record -- again absolutely right. we didn't have the maintenance record because it's not yet our bus. when the bus is accepted by us the maintenance records will be turned over so we know what problems that encountered. >> so i mean -- i guess -- let me just break it down a little more. first of all if there is a bus that you just purchased

that takes a month to get from minnesota to san francisco to me that's a red flag, and i don't understand why you have to accept a bus before you get the maintenance records. i would actually think that that it actually it's putting the cart before the horse. i would want to get the maintenance records before i actually accept the bus because depending on what i find in the maintenance records i may decide not to accept it, and so why would i accept something without actually having all of the information about its mechanical history? i don't understand that. >> well, we -- i think in the process here in terms of accepting a particular bus we would go through and new flyer

is responsible to make repairs until we accept it so part of what we do when the bus is turned over to sf mta on the property is develop a punch list which is a list of components or failures that we go through them and all of them have to be corrected and signed off and inspected before we inspect the bus so we know not only on the individual buses but on the data and have a record of all of the problems the buses incurred. there was a number of things whether they related to software or some mechanical problem that were discovered while the buses were in route and we will have the records to maintain the bus. >> but do you have to accept the bus before you do that? >> i'm sorry? >> do you have to accept the bus before you get the records? >> no. we don't have to accept

it. part of the problem is there has been a lot of give and take if you will between us and new flyer at accepting points on various points and whether something and we have given them notice that some of the things they have produced in the bus are not working out the way we want and given them a directive to fix it. in some cases if it occurs in a certain number of buses then it qualifies as a fleet defect and they need to address it that fashion. >> anything back to the 62 buses were that purchased and some allison and some bae how were they delivered? were they delivered in the same fashion as the 50 buss? >> they were driven by the plant in minnesota, yes. >> do you have a record of any of the buses broke down? >> they did -- i think four broke down.

>> were they bae? allison? >> i would have to go back and check. i honestly don't remember. i have to get back to you on that one. i don't remember. >> i would certainly like to know that if you purchased 62 buses, two different types of engines and i want to know which ones broke down before i purchased anything else. >> if you will indulge me one minute i think -- this is gary chang, the project manager. do you remember? >> [inaudible] i don't remember an exact count. okay. >> hi. this is gary chang with sf mta project manager for the procurement. based on my recollection there were some coaches broken down. however the communication i have with

new flyer because the vehicles are under their possession when shuttling the vehicles to muni. so far i haven't been successful in retrieving that documents but i recall there were a few that broke down. >> out of the 62 and were they allison or bae coachs? >>i think it's a combination of the two. i think there were some of each. i have to go back and double check the counts. >> okay. i certainly would like to have that information. i know i have more questions but i know the that president chiu wants to leave so i want to give you an opportunity to ask go questions. >> thank you supervisor and my apologies and i have an appointment and i will assign this meeting over and there were a number of comments in the sf weekly that

were troubling and the issues whether we went around an appropriate contracting process and real competition here. i am sure supervisor campos will continue to ask these questions. you have provided data around this that suggest that the numbers are going up but i understand that muni -- you have been trying to get information around the mechanical history of break downs and new flyer has thus far re fused to give the data. >> no, i don't think that's the case. if you're referring to the one bus we have lots of data and information that we exchange with new flyer all the time. it's not accurate. they are -- when we take over we will get the bus and whatever maintenance history we need. they were -- the maintenance history that we're talking about again it

may seem like a fine point, but as was pointed out when the -- the bus broke down in route. it's still the responsibility of the manufacturer to fix the problem. >> so from your perspective we have received all of the information that we could possibly want to analyze everything here? >>i will go back and make sure but i will provide the committee since i think it's an important question a written record of what we have and what we don't have. >>i think that would be great, and then the numbers that you provided in your presentation shows that there is good progress assuming these numbers are true. how does this compare to the similar rates for diesel buses? >> well, you have -- they're better than everything that we have. you may remember one of the other things you supported was a overhaul program for a

sub set, some 120 buses that are manufactured by neo prim that are diesel buses and they went through an overhaul program and running between 400 and 5,000 miles, so that the hybrids are at this point well above any of our other fleets. >> i'm sorry the diesel were performing at 4,000-5,000? >> yeah. the ones overhauled are at that range and the older diesels that haven't been rehabbed on the lower end to 27,000 to 34,000 in that range. >> okay. i guess why i am confused the chart shows until 2013 the hybrid buses and were below 4,000 and suggesting diesel is between 4,000 and

5,000 and seems to me they're performing like the hybrid buses, or better than how they're performing. >> we're at hybrid because of a combination of environmental policy and reliability as we talked about, so what we're doing is trying to keep the buses that we have as we change out and convert to the fleet to more hybrid and in the best mechanical order that we can, so that's our plan. one of the things in the chart you're referring to, one of the questions asked earlier this week was why did you consider bae at all in light of what was presented as a negative experience with 86 that were

purchased in 2006 and the performance wasn't what it should have been and one of the lowest performers in the fleet here that you can see in the chart until a couple of years ago where we worked out an arrangement with them to fix four components and now the performance of the 86o ryan buses has came up substantially in the last 18 months or so and we're expecting to see an improvement with that fleet and part of it what i referred to and the next generation of technology for hybrid so we're aggressively moving away from diesel to hybrid technology which i think most of the experts view as transitional until a full electorate is

available and mass produced. >> if i can ask one last question so typically in the private sector when you purchase new technologies you ask for service level agreements within your contracts. in other words, if it turns out that the technology breaks down there are protections that the purchaser has to make sure that that the purchaser is protected. could you tell us in our contracts what protections do we have vis-a-vis the vendors assuming things don't go as we would have hoped? >> yeah, there are standards in the contract if you will i have will gary walk -- >> yeah, i am curious. >> sure. on the bae and allison packages we the bought a two year bumper to bumper warranty for the whole vehicle and purchased extended three years vehicle on the propulsion unit so total five years on that package alone and the plan for

muni is actually we do plan to have a midlife overhaul so that will be placing and right timing. >> okay. thank you very much. >> thank you. i just have a couple more questions mr. hailey. we have heard different people different things about this contract. we have heard that some people believe that the allison buses are out performing the bae buses and that in fact the allison buses are not breaking down to the same degree that the bae buses are. i mean is that wrong? is that incorrect? is that -- do we know for sure that's want the case? >> what i would suggest so that rather than is i don't believe that's the case. i have no information that shows me that's the case, so what -- but i think it's important again to have this discussion and i appreciate

the opportunity, so what i will do is if the committee is okay with that i will provide you with a written report of where we stand and in a time table and we can review it and go through that again. >> i think that would be helpful and we know for sure some of the allison buseses broke down as part of of the original 62. is that something you need to verify? >> we will double check and get you that information as well. >> again the point i want to make sure i still think there are questions about the reliektd of these buses. you yourself acknowledge that the internal review on the performance of these buses continues and that

it continues with respect to the very important issue of reliability. i am concerned that we are notwithstanding the discounted price that we're still spending $700,000 without knowing which type of engine is better in terms of performance and i worry about that because i know that i -- you know, from my personal vehicle i would want to buy the most reliability vehicle i can, and i think the same standard this apply to vehicles i bought on behalf of the muni riders. i also have concerns that at some point buses were delivered and you can -- as a lawyer i understand the technicalities, but that buses were delivered before a contract was approved by the board. i don't think that's how we want to do

contracting and i hope this sends a clear messages to city agencies if you're engaging in that kind of activity that we will make sure that we shed light on it, and it's nothing to impiewn or to assume any wrong doing but i think it's important to have that level of transparency, and the reality is that it's very hard to undo a contract if an item has been delivered and the board has not approved that delivery, and i guess maybe i have a question for the city attorney's office in terms of a general practice for the city mr. gibner when the city purchases an item whether it's buses or anything else is the item delivered before the board of supervisors votes a

contract if board approval is required? what's the process? >> deputy city attorney john gibner. i don't think i can speak to the practices of every department, but but in terms i suppose best practice and minimizing any legal risks certainly delivery and acceptance of the goods that are being purchased or in this case the buses generally should wait until the approval is final. the contract is final because the contract isn't approved until the board approved it according to the charter section. my understanding here from mr. hailey this was actually no delivery to the city and if i understand correctly your question is really if the city were to accept delivery

would that create more of a risk of liability? and i think the answer to that is yes. >> okay. and what constitutes delivery mr. gibner? >> i'm not sure i can answer that question with a technical answer although certainly acceptance and possession factor into it. i'm not sure i could give a technical legal answer. >> okay. thank you. i think that's it for me right now. >> thank you. >> thank you mr. hailey. >> thank you. are there any other -- so with that i would like to open it up to public comment. any members of the public comment wishing to speak on this item? seeing none public comment is closed. supervisor campos is there

anything else? >> no madam chair. i would move to file this item and i would simply ask as we move forward and as we continue to do work on the replacement of our fleet that i think it's important for us to excuse me, follow what we can the letter and spirit of the best practices that should be followed around contracts and i do believe if we make this kind of investment that we still need to know more about the reliability of these hybrid buses vis-a-vis diesel and also within which engine is reliable. i don't have a horse in this race. i don't have one preference over the other. my only objective is to make sure that the money that we're using is used to purchase the best, the most reliable vehicle, and

i don't believe we have followed a process that at this point guarantees that so that's why it was important to me so move to file this item. >> okay before we close out this hearing i want to thank supervisor campos for calling this hearing and also i am glad we had the opportunity to have this really important conversation. i know we have been asked a lot of questions about this and there have been concerns. unfortunately in government there is an issue with contracts. there is an issue with doing things improperly. there is a history in our country of these kinds of things that are happening and so when we see there might be a situation where something improper might have happened it is our responsibility as the elected body to bring those things to the forefront, but i do want to really focus on the high level questions here that

we need to address. did the mta or mr. hanly with hold information from the public about the purchase and i haven't seen any information that indicated that was the case of the information was printed in our pack get mr. hailey discussed it at a budget and finance committee publicly and i appreciate that because mta took the initiative to bring that to the forefront and make it clear to us that this company had brought in this fleet without any approvals, without any commitment, without any commitment from the city and mta made that clear. are these buses going to substantially be less reliable than their allison counter parts? unfortunately there has been no demonstration around evidence to suggest that is the case and i think

supervisor campos' raised a really important question is before we move in this direction we should know what is the best and make the decision as to what is the best for the residents of our city and i think that's important to follow up with us to give us that information. it's my understanding that is still being looked at as we speak and last and most importantly is the city at risk with this transaction and i don't see any evidence that there is. there is no notice to proceed from the mta or purchase order. the manufacturer assumed responsibility for the products without a purchase order and they knew they were assuming the risk and this type of production is normal for their business so mta does not and would not pay for vehicles until they are received, tested and approved and i think it's important to stress that point. does it

look bad? yeah, it looks bad that they would bring in these vehicles all ready to go with muni stamped all over them as if they have an agreement, but again they assume the risk, and we did what was our responsibility as a city. i trust that mta did what they needed to do and again bringing it to our attention in advance to make it clear it was the case which i trucial appreciate and at the end of the day yes it's our responsibility as elected members to bring these policy matters to the forefront and then it's our responsibility to move on. everyday we are getting complaints about reliability of service and it pains me that we can't put more buses on the streets because we have so many more people and we're asking them to use public transportation but we make sure we take the steps to make

public transportation reliable. i will say that we are of course going to continue to keep a close eye on this case as any other case involving any other department whose actions are questionable as it relates to contracts but it's important that we follow the book, abide by the laws and address the issues properly and when there is an incident that might be of concern that we are proactive about bringing those to the attention of not only the supervisors but the members of the public to assure that these things are done properly, so and for one am happy to be bringing new buses on line. the sooner the better but more importantly we need to always make sure we're following the rules of what the law requires as it relates to contracts in any of our city departments so as a result of this contract we're going to have more reliable,

more clean buses, and i'm looking forward to the day when we do have more trains on our tracks as well. san francisco's growing. we building housing at an alarming rate. we have more people on the road. we have more people on bicycles. we have more people on public transportation, and wa we want to do is make our transportation system the best and most reliable transportation system in the city so that people getting out of the cars to use it so again thank you for this hearing supervisor campos and i look forward to continuing the discussion around this and i look forward to the follow through from mta as to a comparison on the two buses that we're talking about so thanks again. and with that we are going to -- we have a motion to file this hearing to the call of the chair and without objection the hearing is filed. [gavel]

>> motion to file. >> yes. thank you. is there any other business before us? >> no. no further business. >> seeing none this meeting is adjourned. thank you all for . coming

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