>> good afternoon everybody and welcome to the board of supervisors meeting of april 14, 2015. madam clerk can you please call the roll. >> thank you madam president. supervisor avalos. >> present.

>> supervisor breed. >> here. >> supervisor campos. >> here. >> supervisor christensen. >> present. >> supervisor cohen. >> yes. >> supervisor farrell. >> present. >> supervisor kim. >> here. >> supervisor mar. >> here. >> supervisor tang. >> present. >> supervisor wiener. >> present. >> supervisor yee. >> present. >> madam president all members are present. >> thank you. ladies and gentlemen can you please join me in the pledge of allegiance. i pledge allegiance to the flag to the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. >> supervisors -- [gavel] ,. [gavel] you're out of order ma'am. you're out of order. we are conducting a meeting. you're

out of order. >> [inaudible] >> sheriff, deputies, can you please clear the room. we will take a five minute recess. [gavel] ,. [gavel] >> thank you everybody. colleagues. thank you for your patience. we're back in session. welcome to the members of the public and we got as far as the pledge of allegiance and now bee will move on to communications. madam clerk are there any communications? >> i have no communications madam president. >> okay. colleagues at this time are there any changes to the minutes of march 10? seeing no changes i do have a motion to approve the minutes? moved by supervisor tang. seconded by

supervisor campos. without objection these meeting minutes will be approved after public comment. [gavel] madam clerk can you please read consent. >> items 1-4 are considered routine unless a member objects and considered separately. >> are there any members of the board to remove any items? seeing none. erk madam clerk can you call the read. >> supervisor avalos. >> aye. >> supervisor breed. >> aye. >> supervisor campos. >> aye. >> supervisor christensen on items 1-4 supervisor christensen. >> julie, -- >> on items one through four. supervisor cohen. >> aye. >> supervisor farrell. >> aye. >> supervisor kim. >> aye. >> supervisor mar. >> aye. >> supervisor tang. >> aye. >> supervisor wiener. >> aye. >> supervisor yee. >> aye.

>> there are 11 aye's. >> these items are passed unanimously. madam clerk can you call the next item. >> number 5 is a cypress security armed and unarmed security services agreement for the amount of $38,314,208. >> supervisor avalos. >> thank you madam president. this item appeared before us in the past and we continued this item so we could hear about the city attorney whether there was wrong doing or potential wrong doing in how the contract was assigned to cypress and i would like to ask the city attorney if there are any results to that investigation? i also want to add what we were not to do anything, not act at all on this

resolution approving a contract with cypress what would happen? >> thank you supervisor avalos. through the chair deputy city attorney ed drew shed. after the consequences of not approving the contract today i will leave it to mta who is behind me but i can provide an update to the city attorney's allegations made a couple weeks ago. we were asked to investigate two set of allegations against an employee in the negotiation process and we found since last meetings that the allegations have no merit. the first claim was that the mta employee involved in the negotiations was improper involved because of the work with cypress and we investigated this claim and it didn't violate any laws with the negotiations.

when he joined the mta in 2012 the employee had no ongoing financial ties to cypress. the second claim was that the same person received kick backs to influence the contract award. we also found this without merit. the sources of the allegation didn't provide any evidence to support their claim that the employee received any payment from cypress to influence the decision making on the contract. >> thank you. just a follow up question. is a kick back -- is that an official term or the language used by the opponent of the -- cypress? >> yes, i believe how the allegation was framed but like a bribe or something of that sort. >> okay. just to go deeper and this employee was hired in 2012 but was a cypress employee in the past. how long before

employed with the mta were they a cypress employee? [inaudible] is that correct? >> right. he was a employee before joining the mta. i don't have that information in front of me but maybe they can answer it. >> is it 10 years ago when he was an employee or do we have a sense when? >> i believe he came from cypress to the mta and cut off ties when he joined the city. [gavel] you're out of order. we're having a public meeting. if you want to speak there will be public comment. thank you. can you please continue. >> so if he left cypress in september of 2012 and then joined the mta in october because he has no financial interests with cypress he is

able to actually conduct the decisions around contracting with cypress? that actually doesn't really pass -- maybe legally it doesn't quite get there but it doesn't quite pass a smell test. >> i will leave some of the questions for the mta staff as well but as to the legal standards if someone leaves the private sector and immediately cuts all ties to the private sector employer before joining a public agency that sort of activity is okay under conflict of interest laws. >> okay. it's very interesting. the mta staff -- who is speaking on behalf of mta ? thank you. if you could just kind of walk us through what the process was for this contract and why wasn't this employee who had worked with cypress in the past actually not

-- wasn't assigned to some other place that wouldn't have any decision making power over this contract? this contract has one that has multiple disputes over the years and i think would make sense to put up a fire wall at some point so there isn't added controversy to the approval of the contract. it doesn't seem it was considered by mta and the contract was controversial before and why how you would explain that wasn't done? >> the contract managed by this individual when he came over by cypress he was managing the contract. the contract has been awarded already and the pricing was set, the hourly wages and different hours for service were set so he was managing that contract. once the contract was approaching the expieration time

my office took the effort to solicit a new contract. the first time around when we did the low bid contract andy interviews international was selected. >> >> and we came to the board and requested approval of that contract. at that time they decided to withdraw the bid. there was no negotiating in that process and this individual did not participate in any award process or decision making on the award. when we did conduct the rfp our office does allow the project managers to handle the negotiations because they're the subject matter experts in their field and best for negotiating the scope of work as well as the pricing because it's their budget they're managing. i as the manager of contracts and procurement at the mta did

participate in the negotiations with this individual on an oversight basis. >> [inaudible] >> did you please continue? ? r. >> >> so i participated inlet negotiation and advised him what was allowed in the negotiations and price reductions and change of scope and hourly rate and different areas and i advised him of that. i'm sorry. did that answer the question. >> the answer last comments you made i didn't get. >> i was saying that i did participate in the negotiations. he did not do so exclusively. i provided advice based on what

was allowed, what kind of discussions. we talked whether pricing could be negotiated up or down and it is allowed and the scope work in the rfp can we change it or modify it, which is also allowed and i attended a couple of meetings with andrews during it is the negotiation. >> when the second rfp did andrews apply? >> i'm sorry. i was referring to that, yes. >> and they had a lower bid and not [inaudible] the contract. can you explain how that decision was made? >> that's the opposite. in the rfp process an independent panel evaluated the written proposals from both party and the presentation. the pricing was one of the factors in there. andrews scored higher by two

and a half points during that process, but their price was higher than cypress' price. andrews -- we asked for an overhead and profit rate which would be added to the hourly wage rate for billing purposes. andrew's proposal was 45% -- excuse me, they were at 47 and a half percent and is a press was at 45%. >> so andrews did score the higher scoring. >> that's correct. >> but wasn't awarded the contract? >> they scored higher therefore we started negotiating with them hoping they would come down during the price. during the negotiations there was discrepancies on the pricing and asked for additional positions at approximately $600,000 more. we were already at a higher rate than we budgeted for the

project. when we couldn't come to terms with them we ceased negotiations and went to the next higher ranked proposer. that was a decision made on our part, not this individual we're talking about. that was a process that allowed by the city rules, so we entered into negotiations with cypress and they did adhere to the original price and actually lowered it a little bit, yes. >> thank you. my colleagues have questions as well. i have others, but i actually would like to have my name taken off as a sponsor of this resolution if that is possible. i was asked to do it. i thought things were really clear and not very controversial but i don't think that despite the work that you have done that i trust was following protocol that the controversy was something that still exists and i don't want to be part of so i want to take my

name off as a sponsor. >> okay. supervisor kim. >> thank you. i appreciate the line of questioning by supervisor avalos. i think even if it's clear we don't have laws in place about those that come from the private sector into the government negotiating contracts with the former employee i do think it's an issue that we should be careful about and i question the judgment of the department in allowing this individual knowing their resume to negotiate this contract, but that's not actually where my line of questions are. my questions are around the armed services. i -- a number of times when different security entities have come to our office -- for example, you see hastings asking how they felt about using guns with security service? i have been uniformally opposed to arming our security officers. i think in general we need to limit and reduce the number of guns on our streets and i have

a lot of questions about the training that the security guards get and why we think we need armed officers at the sfmta and i know officers are used for high traffic areas where there is a lot of cash handling. let me pull that up. a fair collection of pass sale location but you mentioned they're used for subway escort, ballpark detail and customer service and armed supervisors so i am wondering if you could explain what the last four items are? what do those need it and why do they need the guns to serve the function? >> the ballpark detail and when

giants game are out there staff is at that location selling transit passes and handling cash at that time. the armed security guards are there to protect the employees at that location. similarly at the subway stations they're also during events and games and selling revenue tickets and collecting cash and they're doing the same thing at that time. the customer service location is at 111 south van ness next to the main building and they're there essentially for the same reason. there is cash being collected at that location selling tickets to our customers. >> and what is armed supervisors? >> those supervisors are there to essentially to do oversight for the actual armed guards as well as provide relief to those guards for breaks or lunches. >> are they guards themselves? >> they are guards >> so many of the small

business handle flow of cash in their businesses and yet don't feel the need to have armed security detail or even have guns on site. [applause] so why is it that the sfmta needs it? have we had incidences of armed robberies and violence towards the individuals collected cash on behalf of city? >> i'm not aware of any incidents. >> so why are we included in the services if there is no historical need for this? [applause] >> i'm afraid i can't really answer that. the prior contract had the same requirements. >> i understand we have been doing it all along. i am troubled that we have the armed guards. what type of training do they give to the security guards around guns and gun usage? >> to my knowledge -- i think

i wrote some numbers down. they're given about 16 hours of firearm training as well as ongoing psychological training annually or semi annually and conflict type resolution type of training. >> do you know how much the police officers get? >> i do not. >> have you considered other measures and batons and not guns to kind of serve as a deterrent for people to rob our fare collectors? >> the officers do carry them as well as pepper spray with them. >> in the case there was an armed robbery at one of the fare collection sales and if someone approached an officer with a gun what would you tell the officers to do? >> well, if there's a security guard there --

>> if there's a security guard there. >> yeah. >> what would the security officer and the collection officer do? >> i assume they look at the armed security guard that is protecting them and ask for guidance. >> i see you do some training with this with your mta staff members that collect cash. my guess is that -- well, i am assuming there is training if there is a armed robbery of folks handling cash, right, with the security guard s and the people handling cash. what do you tell them in these situations? >> unfortunately it's not my field and we don't have anybody here from the security enforcement group. >> i ask that question only because i would hope that the city would advise that we give the cash to the armed robber so we don't have guns shooting in these high traffic areas. it

would seem dangerous to me if a security guard took out the arms in the face of a robber and if the incident happened i'm not sure if the security officer should use the gun -- do you see where the questioning is going? >> yes. >> and doesn't seem that we need armed staff on site and even if we have them i'm not sure we would ask the security guards to utilize it in the high traffic area. is that correct? >> i agree. if someone comes to me i would give them my wallet. >> i would too. we did some calculation and i want to recognize the controller's office but over the contract if we converted all of the armed hours to unarmed hours we would save close to a million dollars, so i really -- i won't be able to support this contract today. i did ask the city attorney if i could sever the two items and

support the unarmed services which i can support moving forward. i understand to an extent why we have that need in sfmta but i can't support having more guns on the strietds than we need to. there isn't any historical evidence to support that and if we did i don't know if it would help the situation you're talking about and we could save a million dollars and go into public transit and other needs that we have. if this moves out of the board today i encourage you to think to eliminate or reduce all of the hours and think about the protocol behind this and the reasoning and i have to add again i understand the passage of exchange of a lot of cash but we ask the small business owners to do this everyday without guns in the stores and et cetera and i think the city should do as well. >> supervisor campos. >> thank you madam president. and i want to thank supervisor

avalos and supervisor kim for their questions and i have two sets of issues about this contract and let me begin by first addressing the ethics question that was raised and if i may through the chair ask the city attorney there are in place regulations that govern how contracting happens and one of the questions that i had as i was looking at this contract was whether or not the involvement of its individual where you have a contract that the price is being negotiated on behalf of the city by someone who just previously worked for the company getting this contract. are there any issues under section 1090 of the government code which has very broad limitations and has been interpreted so for instance i

would imagine there could be 1090 issue if the individual is receiving financial benefit including a pension so i am wondering if the city attorney can address that. >> sure. supervisor campos through the chair. as i mentioned when we examined that issue of any financial ties or ongoing ties to cypress we didn't find any evidence that the person in question was receiving additional retirement benefits or pension benefits or financial contributions of any sortie s -- so that would eliminate those issues or section 1090. >> okay thank you. i think what we have here is a situation based on everything we know it seems that the existing rules are not being violated but the question is does that still make sense in terms of moving forward with this contract? and i thought what the executive

director of the ethics commission said i thought was very telling, and this is what he said "there's nothing currently in law that addresses this situation" and he specifically pointed out how the law right now protects against city employees leaving city government and then going to work for companies that would benefit from contracts from the city, but he is saying that nothing addresses the reverse situation which is what we have here where you have someone who used to work at a private company and then goes to work for the city, and then is assigned to actually negotiate the contract between their immediate prior employer and this is what mr. st. croix said and asked whether or not it made sense to look at this and he said it would be worth looking at. i hesitate to say yes. in my tenure we come across

situations we never seen before. how often does it happen? if it's a once in a lifetime occurrence legislation and not necessarily an answer, so this is a very unique situation and the fact that there is no violation of existing law to me doesn't mean that that it makes sense to proceed. i think that's a separate analysis and i personally have a problem -- i think the appearance and i don't question the motives of the individual. i give people the benefit of the doubt but i think it looks bad especially when you had a competitive process that actually selected a different company. you did not follow that selection and instead proceeded to negotiate with another company that was not originally selected by you, and the negotiation is being lead by someone who just recently worked for that company. this is taxpayers money. i don't feel

comfortable allowing something like that to happen. it might be legal. doesn't mean that it's the best ethics. the second point is this: i worry about what it is we're getting in this contract. can you explain to me the difference between what the security services are versus what the police department is supposed to do for the mta? what are the differences? >> i believe the differences are that the -- this security contract is for sfmta property and employee's protection and sfpd is more public related. i can only say what the contractor is doing for us. they're protecting our property, the city's property as well as the employees. >> do they go on the buses? >> they do not go on the buses, no. >> okay.

>> they do protect the buses in the sense when they're in the yards over night they're watching over them for graffiti and those vandalism issues. >> see i have -- i might be open to understanding a little better what the need for this contract is, but i think that when you have -- when you privatize a function like security you have to be very careful because we have heard issues that have been raised with police departments, right, and whenever you think about -- take our police department. whatever issues you have with our police department at least you have a office of citizen complaints that is supposed to investigate complaints. when you have a private entity the level of accountability is not at the level it should be, and

so i am not comfortable not only because of the ethics issue that was raised but also because of the point that i think supervisor kim rightly noted. do we really want to go down the path of spending 15 million -- actually no, $38 million for this contract and by the way just something that's interesting is that as was noted in the budget and legislative analyst report we're actually spending 3% more than projected when this process began and we're actually seeing in terms of the service provided a 20% reduction in terms of the hours that the company is providing when it comes to a 19.8 percent for armed services and 15.1 for

unarmed serviceses so we're paying more for less and again the fact that the person who negotiated this agreement used to work for this company i think we have to did better than this so i will respectfully be voting against this. i appreciate the work that has been done but i think we have to have more accountability here. [applause] >> supervisor cohen. >> thank you very much. i have a quick question. i wanted to know more about the internal changes that have happened within the mta to ensure there is clear transparency when negotiating contracts so we don't have the same ethical violations? >> supervisors, so going forward my office will be involved in all of the negotiation along with the project managers. like i said they do need to be involved because they're subject matter experts but we will make sure