sort of a distant future. >> from what i've been reading i'll go with what the ucsf professor said there is no vaccine around the corner the infection has been considered as a middle infection not damage so until we know more we can't precinct whether this as vaccine that mutated rapid so the strings are different in different country's so that explains why we are seeing the neurology paternity and outbreak okay. >> you actually had

someone that is predisposed and it was useful in guiding them as we're going ongoing through the epidemic i was wondering an opportunity to learn how the department handles communications. >> i'm a little bit concerned. >> but cnn and fox and everybody the headlines by far most serious than ebola what is the role we think your department in terms of corrective communications or an updated accommodations the facts are the best way to get things out i find it effective as well as perhaps meeting some of the conditions of the latino community who is traveling back and forth and may have higher concerns. >> right for the latino community that is actually a

lot of dlament and intensive communication from the health organization they've been good about getting out the information in english and spanish we agree we're actively the process of redesigning how to communicate with the physicians at the city level we have a new vendor that is working on emergency communications for the city fast and we're going to leverage that new program. >> you you know now those new programs you can get people to register how to get message by text or fabrication so we're the process of looking at p one of the systems to adopt and use that with the physician community the challenges will be how we connect with the physician community this is actually things for the san francisco medical #10sh9 we want the information to give us the most updated information and the way to be connected i

think that is the biggest challenge of the communication dablts having the up-to-date information we're looking into moving into the 21st century and going beyond. >> i personally want to thank (laughter). >> but the general a physicians are on text and probably on instagram. >> the translation from the commission getting - giving the patients useful handout the fact the briefing and you have even more worthwhile private property this out this is a handful to give to our paternity or community regarding this concern. >> usually we try to think the state those one page #40u67b89 in english and spanish but we try to connect people to the admissions we're not the information changes so rapid we try to use the existing resources.

>> as you see the beef circle it is ahead of the curve i appreciate the efforts of making us all keeping us save ensue feel safe that has harder task. >> thank you. >> yes. >> i wanted to also reemphasis i think fax has some merit should not be overlooked as you go to your communication how many of us get so many alerts if people that never get looked at so fax the office can pickup and realize this is something and actually, it is a useful tool the office then get the word i mean there is someone that picks up and seize it and i think there is really

some value in maintaining the fax system and i think that i like that as dr. said i get a lot of comments from the doctors it is very effective and they can actually since it is print they can distribute to the colleagues or associates so i think remains a valuable tool at least in this year. >> we'll bill from there. >> you can build on it it looks like a valuable tool. >> i'll make sure. >> okay. thank you. >> thank you. >> shall i call the question? >> further questions i want to commend the director on the director's report so it is so useful so many aspects all the way from the county hospital and the system to

our public health i think this is really a model report that we gotten this time that really brought us up to date. >> thank you, commissioners i wanted to compliment the directors communication office for the organization and insuring we get updated information. >> thank you. any further questions. >> if not we'll 0 move on the next item, please. >> item 4. i've not received any public comment general requests >> okay. so moving on to item 4 did report from the finance and planning committee commissioner johns. >> the finance and planning committee met right bra the commission meeting we actually had a very short agenda so it is all on the consent calendar for your approval which is the

contracts report which is one contract and then also a new contract with j.t. c medical specifics for a little bit over $7 million seven hundred 24 thousand - plus. >> so not millions i apologize and then last week a meagerly on tsthe requests to relocation from their current location to the other street location. >> any questions commissioners. >> right commissions questions toto commissioner chung on any of the items.

>> if not we'll move on to the next item content. >> 3 stems that commissioner chung read does anybody wish to extract any of the future items for discussion if not the vote on the 3 items for the consent calendar. >> all in favor, say i. >> i. >> opposed? the consent calendar has been accepted unanimously thank you thank you, commissioners we will take the item 9 out of order and do that next the resolution for the support for the city and county to amend the health code for the tobacco and smokeless tobacco and e cigarettes 18, 20 that with the consent of the commission we'll take item 4 out of order for the presentation being made i see no objection we'll

precede yes. >> i'm andreas power for the supervisors is supervisor wiener and others board members i think he came to the committee meeting earlier last month so the legislation before you today would increase the legal angle to purchase tobacco in san francisco from 18 age of to 24 i want to that's correct supervisor mar, supervisor cowen and supervisor farrell their early co-sponsorship to the board of supervisors and also i'd like to thank the small business commission, the school board and the youth commission all who have enforced this legislation and lastly thank the american heart association and and the san francisco tobacco free coalition for their strong support in increase the

tobacco product from 18 to 21 the ordinance and e cigarettes and e cigarette products and official tobacco products that is left to supervisor mar for to work on that issue last year tobacco remains the leading cause of principle deaths in the united states for nearly 5 hundred thousand people every year and costing as much as one hundred and 70 billion $70 billion according to the usf the annual costs for smoking for san francisco amounts to 4 $400 million in direct and indirect health care costs when it comes to ugliest and condolence 1/3rd of high school students naturally are users tobacco products and 5 percent of the high school students smoke second degree and 13 percent

use e cigarettes this mantels in san francisco nearly one in 4 high school students regularly consume tobacco products each day children under the age of 18 are regular smokers and 1/3rd will die premutually because of tobacco with this go trend nearly 6 million children will die from tobacco use nearly 95 percent of tobacco smokers smoke before the age of 121 people that start smoking are likely to become go live long smokers or smokes and they're more likely to consume alcohol and 8 times more likely to use machinery and other products people that smoke will

dropout and experience pregnant and nicotine and tobacco changes the brain chemical of the children according to a study by the institute of message medication if you increase the age of smoking you'll see nearly a 25 percent drop a 12 percent drop in smoking across the board and a 12 percent drop in premature birthday nationally 80 jurisdictions have increased the age of purposed tobacco from the age of 21 the city and most recently about a month or so hawaii adopted a a statewide age to 24 here color to home the county have increased from age of 21

and the city and county high on a hill it calls to me beggar did so but were bullied by the tobacco industry and given 9 resources they've decided to not enforce the legislation the city of benchmarking is considering enabling the age there as well and the state level in california they have been a couple of efforts for increasing the age to 21st last year and but the bill stalled because of the lobbying pressure if the tobacco industry and so this is the sort of the overall presentation i think we have staff from dph that can get into greater detail all to note that the

paradigm we've created in terms of how enforcement will happen is exactly the same as in paradigm to the way we enforce the age today will be the same as we enforce tomorrow should that pals the only difference is the age ae and another question about has come up that was an ordinance about making it illegal to accepting sell the tobacco to minors and it is about enforcement the public policy point-of-sale so get the tobacco from someone the household or outside that is not - the point point-of-sale is what with your trying to do is minimize the opportunity so i'll be happy to answer any questions you may have. >> and staff from dph. >> thank you very much

from - does staff wish to add or take a couple of testimonies. >> well, we, very quickly run 0 through the gentleman did a great job of the overall so only limited information to add i'm 9 director of the tobacco project. >> i'm jeanine with the health inspector and mark our friendly inspector. >> great. >> all right. so essentially we want to let you know the overall issues from the health department and gene then is from the health department i'm from the equality branch we're working in partnership you can see the system

you're probably well aware relatively low smoking ooflt state of california a fairly flat level between 12 and 14 percent smoking i think ugly aware of the many, many health effects of tobacco really being linked to every type of cancer another concern you're quite aware of introducing regulating e cigarettes similar to cigarettes it is proliferating all over san francisco as you can see there is a long, long arc of the last 17 years as decline in smoking we're proud to work with the community as well as the health to bring down the smoking the overall population we're a leader nationally in the last 17 years and really among the county the united states the

top counties that are lower the smoking range it has to do with legislation and the programs as well as engaging the generations and #25ib8 tobacco you'll notice disparities this is one segment many talks about smoking amongst african-american while pregnant and as well as cross smoking and a variety of communities of importance we're working on those issues and to mention the work we are doing and the questions requests for the introduction of tobacco 21 ordinance that the request for resolution is very much in line with the health department and the efforts and particularly the black african-american health initiative we've reducing breast cancer and reducing

the impacts of addiction and the products in the community and across the country youth smoking prevalence the information is below but continues to reduce the youth smoking and the san francisco unified school district we're presented to the board of education yesterday we're tender to see the reduced smoking with cigarettes but unfortunately year by year cigarettes being used no san francisco unified school district across the country and something we're watching closely and electronic cigarettes 2 years ago in san francisco are the same cigarettes this will owners will apply as well as so young people under 21 whether electronic or vap i apologize i'm not sure but the handful

>> would - great i'll continue as we go. >> smoking preference as i mentioned has reduced over time, however, the electronic smoking is increasing the concern - thank you. >> the real concern this is about assess young people assessing products if you're underage you're not allowed to purchase you can if you know someone that is 18 the idea of tobacco 21 to reduce the access to the tobacco products so 15 years old are not like 18 but increasing to 16 or 17 they'll not get the tobacco products andrew mention it i know your pressured by the institute of health, i know this is generating interest a way to

move forward and getting that down amongst the young people and basically stopping the future from tobacco use that's why berkley and state of hallway. >> and kansas city, missouri, of course, i don't recognize did this several years ago. >> here's a map for your information about some of the jurisdictions that are #1k56r9 around the country massachusetts is a considerable decline and happening great this is good news in the community and then the policy generally as andrea said changes that age of sale for tobacco products to 18 those who are not 18, 19 or o or 20 only 21 can pretty much we've highlighted a few of the arc

maybe the last 8 years and the policies that the commission alerted and was involved deeply that have continued to move along or not sing san francisco is not as well as our youth assess reductions and then my colleague jeanine will speak. >> thank you. >> so wanted to share with you the current enforcement process right now the health department partners with the san francisco police department and in the minor decoy the retailers are not selling tobacco products and then we take action. >> so since 2008 the health department has been above one and 8 tobacco products and that ranks if zero to 70 days for the circumstances and whether or not a it tobacco

products were sold to a minor on more than occasions at that location on the proposed legislation we'll provide a one year grace period during that grace period focus on the education and ouch to the approximately nine hundred retailers that have the tobacco product also during the grace period no retail will be penalize for selling tobacco products to a 18 or 18 or 20 but after that the process we shared earlier so as shared already 21 we're calling this legislation has unanimous support from the small business commission the instead of board and the san francisco unified school district is asking to

partnering with the #4u9 to outreach to the community and health commission we have the issue that is up to the board of supervisors. >> so today, we request the health commission thirty to approve this in support of 21 i'll ask my colleague to come if you have any questions for the two of us. >> there is a public comment request. >> why not take the public comment and bob gordon for the tobacco free coalition. >> mr. gordon i have a timer. >> good afternoon commissioners and members of the public i'm gordon the castro resident and have with the lgbt positive community that started in 1991 called the last drag so there is support for the members of

the community i'm co-chair of the tobacco free organization it is made up of many groups specifically working with people of all ages and young people with youth leadership with breed california and bay area resources and the youth development center to name a few of the members thank you for all your hard work to help with the information the purpose in speaking with you to say a few words to race the age to 21 with the tobacco will be beneficial for all san franciscans fewer people smoking will not only benefit the individuals near and dear to my heart but free from older people that start in 13 years started smoking is tremendous savings for the

city and fewer people means safer home and environment and ills that are associated with over the 20 are 20 tobacco related diseases as cited by our surgeon general with the health and lung diseases and overall environment so fewer people smoking men's less toxic and less associated with our city so in san francisco we've worked in many ways with our support to protect our young people from the deadly addiction to tobacco and this starts in the teenage years that's why that policy is right ones and the heart of preventing people from starting and all the suffering associated so in closing ask for your support to prevent additional death and addiction in our community you thank you very much.

>> tu prhank you commissioners questions to the staff or the gentleman commission. >> thank you. >> my question is you were working on interventions you were working with groups their clear disparities or consistent disparities can you tell me interventions you're using. >> yes. >> and the impact. >> certainly. >> we're the prosecutes of the tobacco project works a local development called the community action model we're reengaging the community to do problem solving within their community so over the years the public education have come from those groups so as well as building youth leaders and community leaders at the current time we have a variety of projects we're

moved he california is looking at some favor tobacco as well as men pathological liar related to the african-american and at&t other community and the vietnam and the intend to with the impacts of the community bay area is engaged mostly in undocumented latinos and people that are looking at housing and opportunity to protect people if smoking in their homes and the final project i ask my staff member the final project is could be working right now on advisements thank you and leadership services young people are look ating the advisements of alcohol and tobacco and sugar sweetened beverages, etc. on their

community precipitations to the idea they do data collection and establish trying to move forward to see if it makes sense for a solution in the community who a policy etc. >> thanks and also the leaders are exist about the next generation a step up. >> commissioner pating. >> thank you for the staff bringing smoke 21 given did history of the harmless tobacco this issue is really a no brainier and i'll strongly support it i think the evidence that 18 and 19 has been actually, well documented and that anything we can do to delay assess and delay the youth will length edge lengthen and - but the

definitions i know that will explain our - e cigarettes and flavored e cigarettes and the many colored south side products this is very appropriate so thank you for moving forward. >> my question on the next issue moving forward my guess 19 q you'll be lynn up i went to new york last weekend and stayed up to 3 in the morning the longest 3 hours of watching tv and continuous favor cherry and chocolate flavored it was a hotel i couldn't get out this made me hunger those cigarettes i hope an issue on marketing and perhaps the next issue

of marketing very powerful i was enticed i went to sleep but i hope the rest of the consumers don't fall asleep with the potential nexus market it is very you know made me wanted to congressman my i ton into a cigarette carton. >> that's a great point wherever the agencies are looking at that i'm not entirely sure of the regulation of advertising it may be a challenge of federal communications commission i'm not sure but this is we'll take note of it additionally a possibility the sale of those products something our jurisdiction i know it was a counter marketing for tobacco at at counter market technique start being you

know young folks the communicated community that is attracted to the e cigarette market and will especially the research. >> commissioners any other questions. >> if not, we're prepared to move the resolution if somebody would like to i guess commissioner pating. >> yes. move. >> with his testimony . (laughter). >> and there was a there is a motion and a second any further discussion on the resolution before you? in not >> all in favor, say i. >> i. >> opposed? this resolution has been passed unanimously by the health commission i thank you the next item, please. next item please the next

item is the waiver. >> good afternoon, commissioners i'm colleen the deputy the director of policy and planning to talk about a little bit about the medi-cal california medi-cal demonstration waiver and i'm going to talk really about the mechanics waiver not about dph implementation there is still a lot of details to be worked out and unfortunately doctor katie tang leading the work is certainly can talk about it but she's on full service she's unable to be here today but a lot of it is still -

we have the general are perimeters thank you. >> so i'll cbo through if you have the slides in front of you just a little bit of ap an overview as you may know medi-cal e medicare e medicare is a state jointly local and state that is matched with state dlvrz depending on our states income and so our state is at highest state sharing level at 50/50 it is about $0.50 on the dollars provided by the state and 50 by the federal government waiver allows the states public school flexible to implement new and initiative programs there are conditions about the waiver that are required first budget newly illicit if you're going to waive

certain requirements it cannot cost the federal government more than that would the absence of a waiver so california has had medicaid waivers for public hospitals this is california 2020 supposed to take us through 2020 but the labor for hopeless y was renewed it 2010 that was the one called bridge to reform that created the great terms last week lift and he hopefully, we'll never will have to say again, this one is medi-cal 20/20 two. >> so mel 20/20 began on ja anuary one 2015 there are a lot of details to be worked out that it is retroactive to january 21st but certainly the january 2016 is end on

december 31st, 2020, it is worth 6 $6 billion in federal funding that was $0.50 state funding and federal government so $12 billion in total when you match the states contributions to the waiver the demonstration project the waiver seeks to achieve 4 goals one to achieve the triple costs for people and improving the health of the populations to place high emphasis on the physical health and also to support the safety net and the medicare program in the long term. >> so there are several programs underway from the prior waiver i'm not going to go over those those are state operation for the h.r.

assistance and children's services and on the meat of waiver for public hospitals are the at the bottom the slide i'll go over each of them in detail the personal care and the dental transformation and others included the waiver . >> so prime stand for public hospital redesign and incentive and medi-cal it is a successor to the district delivered performance and treatment program this comprise more than half of 2020 fund and funded at 3 $3 billion over the 5 years. >> the funding is essential flat compared to the district in the first 3 years and schedule to reduce by 10 percent in 4 and 15 percent in year 4 and like the

program all incentives are available for the hospital systems and they're available for assistance that meets certain improved targets so the plan requires the hospital to complete 9 projects in 3 domains those are the 3 listed outpatient and the transformation and targeted high reflex populations and efficiency so hopeless has a mandate project 6 of them the first 23 categories and voluntarily which i see one in each of the 3 categories for a total of 9. the operating hospitals all across the projects to achieve the full allocation potentiality and requires that participating hospitals assume reflexes from the managed car population and

thresholds around the care models to make sure that hospitals can meet the full potential of they're planning >> the global payment is the second new program under the waiver and this is first of its coming down the pike kind in the nation to drive the care of urban insured people and incentivizes the prospective over medi-cal the global payment program combines two forces of reimbursement to create go flexible programs for the uninsured those two planning sources are the disproportionate planning program and the care pool. >> the as you may know the decided promoter care is scheduled to decline under the terms of ac a and the

elements of the care pool 3 to 4 the funding is still to be determined. >> the details of the system continue to be developed in the waiver but sooernlt the federal government will establish a system whereby points are to the medi-cal so the read onions of the waiver that will be weighed hopefully will i then than preventiveable care they'll have a told her using the historic urban insured data and hypotheticals will have an opportunity to meet their threshold tell you providing any combination of the services to the urban insured and remember the services that are pretend will weigh more heave will i to move the hospitals to care for the

patient in an #k3w0ush9 manner that is a new component of the waiver and it presents an opportunity forfor dph for the extra those pilots will be awarded and will be funded at approximately, one point 5 $1.5 billion over the 5-year waiver the medi-cal he beneficiaries such high utilizers or cost of patient the pilot applications are currently developed but we know a few things about them they'll require the city and county or health plan they will require collaboration and include the nonprofits and coordinate the #34ri89s will require the physical and behavorial

health services as well social services this is pro tem about those pilots are the coordination with supportive housing. >> the dental transformation initiative it the final funding initiative that will be included the waiver and it provides about 4 hundred $400 million over the 5 years of the bill toto improve dental health from young people the state will establish the metrics that will help with the sustained domains that are listed the providers will earn incentives for the dental services and expand the treatment of care and increase of continuity of dental care. >> so the final important consultant of the waiver are

the systems and evaluation so first in addition to programs and financing the medi-cal managed car will focus on the adequacy it will work cross the medi-cal, medicare system two care assessments one for the safety net care pool at the native public hospitals i mentioned years it through 5 of the global program are not determined the results of this assessment will determine when those amazes will be in years it through 4 and other care assessment will look at care across all hospitals statewide. >> then both the prime and global payment have interim and final evaluations dph has

been engaged with the waiver discussions since in earnest really engaged inform a lot of years but meeting twice a month since the summer and we have been participating and analysis advocacy for the california association of public hospitals and health systems they're a partner we have considerable input from the marin on the board and conversations with the delegation about the san francisco program our implementation team a cross section from the health net and the hospital, from finance, from policy and planning and we really work hard to cooperate the internal and external preparation for labor implementation. >> so just in summary medi-cal 2020 has challenges

and opportunity the challenge sis what i neglected to say earlier the fund at 6 point $6.2 billion is less than the value of current waiver the current waiver is $8 billion fell funds statewide and the new one of point 2 billion $2 bi llion and this is either fell fund that have come to the health department they receives their amounts depending on the average about 200 and 9 this is a significant source and the whole value is less than today than the prior waiver also the prime metrics will be difficult to achieve this as i said this is a successor program and works the way it you have to meet the milestones and metrics to refer your full allocation this will be difficult for any health system the primer

program to meet 100 percent of the metabolics in the firefighter and after so the care that creates uncertainties we know that the hospital will - adding to the reduction for the care of the insured is the years 3 through 4 an additional uncertainty there are also opportunities, however, there is the opportunity to focus on value over volume our previous services and the way that health care is combrurmentd it focuses on volume and has been moving to value but not really made significant strides as we would like this pushes us in this direction and consistent with the goals the network and also continent with the

goals there is patient center care primarily outpatient this is great flexibility to care for the uninsured we've provided care for the upper insured that is not reimbursed we have those opportunities for those services #2k3wrur789d under the medi-cal global program and finally the opportunity for new services associated where the supportive housing not supported by medicaid the past and there will provide a new opportunity for that. >> so just want to say you'll hear more about the budget aspects the next preservation but take a moment to thank any colleagues you've seen many times have's accepted a position as a policy in fact, so she's moved 0 on from the office of policy planning to the mayor's office we're lucky to have her in that

position she's really the residents expert and with the support thank you very much. >> thank you. >> thank you. >> i'll note no public comment requests okay. >> commissioners this is is complex subject. >> can i just - i just think that it was excellent took the wind out of our sails. >> all of a sudden you thought we were cut back from the threshold since 2005 and you said the fact over time and being cut back another 2 employed and the challenges and then thank you it is was an excellent completion

presentation we're fortunate to have the staff to analyze and really a unique inside proposals for the future so thank you. >> commissioner pating and i have 3 questions first of all, thank you you've been on a lot of policy issues every commission we've got big items to thank you for all your work and others. >> in terms of total dollars can you tell you before this goes in federally there the waiver and then are we at risk to have an decrease or possible increase in dollars. >> over the 4 years of the labor it varied over time 200 $200 million a year we've receive through the waiver i think that the gentleman

will have in his budget projection the next budget. >> and turning to the opportunity of waiver i really liked the 3 p and f preventive patient center that is in line with our core manufacture of being the health center of choice can i ask you a question about the flexibility certainly medicare and he medicaid are tied to patient services that have certain flexibility can you speak to the issue of flexibility will be a flexible be creative with this or sort of a small flexibility not very helpful the long run. >> there is greater flexibility opportunity the challenge is capturing the data we might see people in

for in mental health in areas that are not currently grurmgd because they're not curiosity reimbursed under the medi-cal plan f but not necessarily tracking whether or not their insured people in immunization but we don't already track whether there are not an insured there were financial motivations to track in that way your challenge to capture the work and being able to demonstrate in a way that is addable to the federal government. >> with the electronic health record i know expand that capacity and service you know all over the system and being able to help with the billing in that way. >> i would imagine that will improve the ability to

do that although the timeline is a bit longer than than the timeline for the waiver. >> but the last they know regarding the challenges and t the primary mefksz it is reported out to usus i don't have the scorecard but would be useful to track and also a question do those line with other metrics headache the commission like are they completely a set of non-coordinating measures no response to report out. >> we've been talking about the governor structure for our implementation of the waiver and keep an eye on on the metrics ufos so we'll keep in mind how to report back the commission that is not hospital focused maybe not the cac we've talked about internal but make sure

that your informed and in terms of the measures themselves other way we participated the log around the development of those programs altogether the participation of their dph staff members on various teams were working on the design of the miles an hour so we had people if san francisco general and the network that participated the selection of indicators from all the areas we're likely to participate so we were involved the discussions and of the selection of the indicators and had in mind whether or not they were already in a way they were in their places so we didn't have to indicate if we didn't have to. >> thank you very much for the support and excited about the waiver and the details you know careful what we ask for i see a lot of work and

thank you. >> thank you. >> commission. >> thank you, again, for your report. >> excellent report. >> i'm curious seems last week, a weird question electoral policy with the 5-year plan i don't know if it gets #25i7b8d up. >> that was part of the part of motivation to get this really finalize for or before the end of 2016 we skim to an agreement in the fall of 2015 with the fall of 2015 and more final agreement at the end of 2014 and, yes, that was part of the reason we didn't want to drag this out to have expectations of the waiver in a climate not available to grants in california.

>> good work. >> thank you. >> i think that commissioner pating was talking about how to follow that aside from certainly we will need a report on how the department b will carry that but you've hit on a difference between the district and this this - the prior waiver to a great extent was hospital focused and i'm feinstein understood they may change the system and this is a system report card so we're kind of in singlingync request an asking for system reports in some way it looks like a fraction on some of the items to be followed the process that would tell us

how various things are doing all the way from recording to the new global up to that time programs and to incorporate under whole person care and i think that it is very important in terms of us being able to keep track of performance and also now performance in a clarified waiver so is that about the right way we're using this. >> you're absolutely right commission i'll suggest we have those here i want to think of how to incorporate that the san francisco network reporting out to you and doing it on a quarterly basis that will take time i suggest we have it so everybody understand with the money needs to be earned and the amount of dollars to the commissioners to understand

the challenge and want i to know that staff has been working hard and trying to - i've seen them in 20 2 weeks working on trying to get the state level involved so proud of work getting everyone to understand i think as a govern structure those reports should come here so call the commissioners understand the importance. >> right i know that we're in agreement and especially during the former active periods and probably be sort of finding how or which measures we're all on a following how we'll carry some of these out they require an integrations and i would ask what would be a reasonable timeframe to have you come back a quarter from

now or three or four months uses i think we can certainly check in in a quarter not sure when the attachments and - excuse me. do you know when the attachment will be filed. >> april one they should be final and probably need time after that. >> so why not say in may then if we can follow-up and see what progress we have made in terms of either getting further clarity on some of the perimeters on what will be measured and some suggestions how to be able to demonstrate the performance in these waiver requirements happy to do that. >> okay. >> i like the fact the metrics are a measure that i mean i see the work the

director authority shifted the right direction so we don't have to turn around if i see we're heading down the path so i just commend the foresight of the department planners. >> very good. >> well, thank you for making a very complex subject a little bit more clear and look forward to the next - our next opportunity forfor more of what we'll be doing the waiver. >> thank you. >> thank you. >> commissioners the next item is the budget proposal the first hearing and remind

the public this is the first i day you'll hear that and vote on the next meeting. >> good afternoon, commissioners grey wagner chief financial officer so we are planning to have the first of our budget hearings as you may know we have historically had at least two and usually more hearings as we glow the budget process and we will be continuing to keep you up to date over the next many months as the budget works its way through the process we're here to talk about is as you may know the under the city's budget process departments are required to submit a budget to the mayor's office and

controller's office in late february and so we'll planning to have today's hearing and a subsequent hearing various aspects of what we're #3r0e7 to include. >> there is still a lot that happens after we submit i the mayor's office to develop a final plan so what we're planning to do today is to review what we touched on in december about the picture for us and what our targets we're required to hit as part of budget instructions and present a plan how we intend to meet those instruction requirement at our next hearing i'll have additional initiative once we have ourselves in a position to get our targets covered we'll talk about some of the

things to fund internally within our budget and give you an corrupt join the electronic health records project and funding for that. >> so for today, we're going to talk about context and the news one, two expenditure initiatives so very high levels of context this is the basis budget for the department of public health for 2016-2017. so this is the adopted yes, year the two-year budget as last year and adjust it for some of the things that happened interim you see the breakdown of the total expenditures by division but san francisco general hospital is by far the largest you also see the public health division is number of things included

beyond the ph.d population and health services and the straddle administration and the dollars for entering governmental expenditures but the largest as you can see many of the others fall in terms of what our budget is spent on the past salaries and fringe benefits is about half of the total project on people like me and others throughout the department our second largest expenditure, of course, is non-pencil contract and so that includes all the contract with the community-based programs and contract with vendor or it services etc. >> so we are department that receives a large amount of general funds and revenues

to the table as i know one of the commissions has asked to see the past or start foreclose you shows the divisions how much revenue w are regenerating through the activities and how much general fund support is it required to subsidize those operations as you can see every division in the department does receive a general fund support the percentages vary based on the ability to draw down revenue in those positions but overall it is about 2/3rd's of our budget that we do refer through revenues so we're a significant revenue generating operation and that is always one of the focuses of our budget and financial is how can we maximize the ability to draw that so we don't need to reduce our expenditures. >> so in terms of how you

are budget is changing we are growing this is a comparison of the final approved budget or 2015-2016 the years we're in current and our budget for the first year the coming budget and subpoena duces tecum r as you can see we're to grow by 37 $37 million or 41 point 8 percent .8 percent i can answer questions if you have them about the individual divisions and what's happening there but we see increases in the cost before we start introducing budget initiatives from things like growth and benefit costs, any labor contractors increases have been negotiated by the city, inflation and things like the pharmacy supplies and those are standing still we grow in our total expenditures

one note there is a negative number on the slide for sexual abuse that is due to the fact in 2015-2016 we had a capital budget for the medical recess pitted expansion and there was one of the expenditures so it goes away it looks like it drops it is a one time expenditure ftes and positions again, we are continuing to grow we have added a very significant position in the department since the worse years of economic downturn we're back at actually exceeding our prior peak in ftes a lot of these are from initiative from the commission the budget and

we've added a significant amount of staffing at san francisco general hospital and the anticipation of the opening and seeing the continued annualtion going into 2016-2017 and other areas that stand out here puc primary care we've adams quite a bit to primary care over the several years part of expansions initiative and part of primary care call center staffing all those nechts that came from the affordable health care act readiness planning to there the capacity and ability to remain lives in our primary care program as you can see in the public care the significant portion of that is it positions that we have added as we've tried to stabilize our it decision in preparation for the electronic height records and associated with it projects

in the throughout the department another significant portion we have been systematically trying to state of california add the public health the operations and as you can see more of that in an initiative we'll bring to the next meeting we're trying to support of the integration and the public health division ability to be fiscal in its notice model. new model. >> in terms of the total city budget context this is very important we're the largest recipient of the city subsidies the largest department and the largest on the general fund the city budget deficit is not what we had seen previously the darker years of the revision we're seeing a deficit three or four hundred million dollars so the

connective growth it the city is experienced has left dark times hunted behind us about a but a general fund expenditures and that gap is about one hundred million dollars for 2016-2017 and it grows to two hundred and 40 $240 million in the second year of the project i believe we talked about that when the mayor's budget instructions a couple of factors mainly interest is a big change in the estimate city contributions to the pension system that was something that was could couple of changes that rpwere not

anticipated the previous forecast so, now we have more news the city has to balance the costs and the cost of several voter approved mandate that allotted spend, of course, specific use the two main factors and overall the city can is relatively in good economic condition and the news is not quite the same by the way, heather economic review forecasts but because there is the deficit the mayor's office has instructed the departments to reduce their general fund by 1 .5 percent the first year and an additional the second year so for us the told 9 point 6 $9.6 million the first and more in the second i want to emphasize from a prospective as as you saw in the 5 a few pap smears ago reducing our general fund by 9 .6 but that is compared to the already amount that has

grown by $37 million so this is not on a actual reductions the growth we're scarred to death to trim that growth back so that is an important distinction not always easy to describe but we have a lot of costs for the employee benefits and was this those are already assumed in the deficit wears not asked to reduce we're only asked to offset the growth in ourour department that is planned for us one reminder that we always like to get from the controller's office you've seen it before essentially showing you shows we're a long way into is an economic recovery it didn't seem like it the bar graph is back to

1904 between the downturn of negative economic growth as you can see how long it is tended to a last at the top we're in a way of continuous economic expansion the united states and the bar at the toup top is essentially where we are maybe a few months longer since this slide was created by the bar to the right shows what it looks like if if he make it though the end of the year we'll experience a down turn we'll b

e experiencing the long period of continuous economic enhance expansion the nations historical it is exceptional the point of caution 9 controller's office and mayor's office we're not forecasting a down turn but looking at what has happened hiv not a surprise in economic downturn does occur over the period we're planning for financially right now, we're trying to keep in mind and how to manage our resources and keep ourselves prepared in the case that happens. >> so that is the global budget priorities before we move into the initiatives as you may know developing the e if i had we'll be talking about that at the next meeting an internally funded program not a general fund it dollars that are available to subsidies that we're working on plan with the mayor's office and controller's office for how we approach that implementation of the waiver you've heard about prior to this and focused on the

network and the public health divisions continuing what we startled not trying to get off but follow on the strategies we've old so it is opening to the san francisco general hospital it is primary care assess capacitate, public health integration and internally and with the network so you'll be seeing initiatives in the next hearing. >> so this is the big picture for how we're planning to meet the target what you see on the top line the same numbers from the previous slides the general fund reduction target of 9 .6 and 9 .2 from the mayor's budget instructions and blowing below are things we're making to meet that start

the first for san francisco general hospital baseline revenues included are the impacts of the 111 waiver we're outlined where we are and to answer the question came up during that hearing we do expect there will be a total net reduction to the revenue available to us under the mayor's and this is because of a couple of things but prauchlt it is because of the detection over time the distributions will come into effect the total dollars to draw down under the waiver will decline in the previous years it was not an issue but this year we'll manage a larger reduction but what we are looking at the two components of the waiver

this is outlined in tsthe memo and the materials the packet the primary program which was formally district there a $7 million reduction in our total hot bowl allegations this is getting smaller and start in the current year a smaller pool to draw from for prime under the global payment this is a different situation in the earlier years the waiver the total amount we have available to draw on is consistent with what we're getting could i but over time that declines so the other years the waiver are maximum amount of money to driveway u draw is a less than what we currently received so over time a

smaller revenue source for the department we've also assumed the budget make some assumptions much of that revenue will be able to draw down you've heard in colleen the prime measures will be harder under the district and we've been able to draw your district dollars we've been successful at it but want to be cautious and note over budgeted we're anticipating in the figures in our painlt packet we'll draw 90 percent of our prime allegation this means 90 percent of the mefksz and the global program we'll draw down 75 percent of the total available funding the reason on the global up to that time program we'll be held to new standards how to

report and document make the case for how we draw down the funds we're trying to be cautious on how much revenue we forecast especially until we ged get our minds around how successful we'll be so there are some losses built both in revenue line we're assuming a $14 million reductions the years 2016-2017 and growing to 28 the second year so is significant impact on budget those numbers are offset, however, by revenues in other areas that is consistent with the policy as targeting but growth in the system that are offsetting the loss of this revenue the other things i'll note the revenues is you will recall the last year's

budget process the mayor's office and controller's office supported us in being able to vdevelop a revenue reserve available to with fluctuations cross the years the revenue that is helping us we're assume we'll be able to draw some dollars that had been put into the reserve that a very, very positive they know for us to manage our revenues without going into expenditure reductions areas there is 7.7 laguna honda revenues and $6 million in mental health revenues forecast and then the next line on this is the revenue amount that has been assumed the mayors deficit so we need to cover that and we'll use

that towards our start. >> lastly there is initiative in your packet called slayer adjustments so we vhave as weechz discussed added a lot of positions over the last several years and growth is very significant we are gratefully hiring but we're looking at the actual expenditures we have not yielded been spending those new salary dollars as fast as added to the budget the end of fiscal year 2014-2015 we have $27 million we spent on salary and fringe dollin our budget it caused us to step back and look at it and reforecast our hiring schedule will be and how fast we'll being able to get those dollars out the door we're not leaving unspent money there is result we put

together a proposal the packet before you we think we can peel back 7 and a half million dollars of those added salary and benefit costs we can use them for our balancing and we can do that xhovrnt without effecting our ability to continue to gratefully hire and aggressively continue with the program the project so really about our ability to fully expends those salary dollars with natural attrition and delays in hiring due to the nature of the city processes. >> so that's our proposal and again, we, xhovptd do that without impacting programs and with certainties about existing employees. >> so adding those items

as you can see at the bottom line over the 2 years 6 hundred and 41 thousands of meeting our target i'll work with the mayor's office to figure out that amount but we're within the rankle that we need to be and wewe can now from this point got the target met and cleared the revenues and come back with additional internal reallocations we want to make for the strategy priorities within the department i know that's a lot the last thing - 9 item the inflationary costs changes to the budget but don't factor both the totter they've been assumed the deficit for the increases in other contracts and materials so in terms of what we are

again another hearing next week and working with the mayors and reporting to you over time prior to june 1st had 9 mayors budget goes to the board of supervisors and in june we have board hearings there is a lot coming up i'm i'll be happy to answer any questions you may have. >> thank you pr any public comment? >> i've not received a request for public comment. >> commissioners. >> questions yes. >> commissioner pating. >> thank you, mr. wagner and the team waiver i wanted to see at risk i'll looking at one of the tables we declare at risk probably losing 34 $34 million and the memo to us that is not on the glass and

the next year 47 $47 million i assume those are offset i want to thank you for managing that - i'll say when finance is looking at the policies and services this is really a large thing in our our general fund dollars and you get into alignment like that and i commend you on both sides of the aisle the services and revenue side for being able to absorb those kinds of swings how we're providing that here. >> my question i guess any provision during the rollout to transition moving to prime providing american people existence on january 1st and prime comes down that seems like totally disruptive for one switch to turn off and one on how systems have to

move and be implemented and funded it seems like shutting down factories so can you speak to that concern. >> this is really the greatest appreciation for the work you're doing and frustrated with the colleagues whoever designed that. >> it is a little bit of both so this is a little bit of offer laptop what we'll be doing in terms of the areas and developed antes an infrastructure that helps us capture and report the data that is useful but, yes the focus is more on the encounter primary and specialist care and on the inpatient but the things we'll be measuring is different and in fact the district measures stop reporting on them reporting requirements stopped last

year at the end of the last waiver so hopefully the infrast ructure we built will help us be ready for prime but it requires a significant amount of effort. >> okay. i guess the slightly difference of tone the causation harder to capture overseeing powders than the previous system are your numbers here at risk and the 47 $47 million that is our general funds expenditures is that convert at risk you don't have the targets or kind of what you're thinking is happening with the targets. >> yeah. on the $47 million to clarify what is included in those this is technical and confusing so the quality of the waiver program areas there is a state i'm sorry a

non-federal share and federal share those are financed predominantly through intergovernmental transfers to the county will send some money usually 50 percent of the cost of the program through the state and federal government and comes back matched those revenue numbers the positive and negative are compared to what the actual impact on the budget 0 when you're looking at the nichtsdz on page 9 see the large amounts under the medicare waiver and under the useful section line that says medi-cal waiver i gp those are the reductions of the amount of non-federal shared we have to put in that 20 and $29 million offset the 34 and the $57 million so our net

impact that we're forecasting so that the numbers at the top are gross but the net impact is $14 million loss the first year in 28 in the second year. >> that's sounds like a lot better than the 54 and 37. >> it is better but your point your overall point remains there is risk to us so again, we have counted for some of the risk bit assuming we're not make 100 percent of our measures and there is reflex in delivering on the positive side one of the things that have been difficult in the previous waiver is that all of the dish and safety net pool dollars were pooled at the state level and the departments submitted the claims based on their costs and a share of the pool dependent upon what everyone

else submitted if you have 11 percent of cost you get 11 permeation of the money if la had more costs this year you went down to 9 percent there were always significant fluctuations and estimate of funds to draw down for that reason our share was temple on all counties participating under the new waiver and one of the things we pushed for the process there is a reduced amount but it is an amount within our control as to whether we achieve it will we'll no longer have the dynamic we have a fixed allocation this is available to us if we meet our targets under the global up to that time program we'll draw it if we don't we don't but depends on what we do the other health systems do so in that acceptance there is risk of

one kind that is adams program and reflex of another kind or you think certainty that is reduced under the new waiver where that will be more up to us to create our own destiny >> thank you very much keep us possessed the next year or two. >> commissioners we'll to acknowledge our staff but also greg has taken a strong position to the staff be cautious because of the certainties and i want to acknowledge the request and so everyone has been i think very fair looking at that and also the fact we're trying to prepare for a new h.r. so that is the initiative the year. >> so for the next coming years so i do want to

acknowledge them from restraining themselves how to growth as you can see we've been so in bringing the positions on we think about the positions you have available to you the next phase of the waiver think that is good, i want to acknowledge both greg and the staff that seems prudent to looked at forward. >> so mr. wagner on this same page on page 9 could you explain the use of priority of your research and when does that run out that is kind of where you are talking to try to balance this also. >> yeah. so in the real short answer is that we're still developing but that is going to look it over time this is the first year we've

actually used the new policy so there is some things we need to decide to figure out how we're going forward the short answer we have at the end of the year last year, we had identified a couple of specific items that we had identified as risks the biggest ones were the reduction the capitated rate for medi-cal expansion population and this is about 167 $167 million and an associated i g t that rates had been going to i pack we had the fund retired we're drawing them out in fiscal year 2016-2017 to cover that shortfall in fiscal year 2017-2018 we are doing a similar we're taking a similar approach to draw

fund reserved but we anticipate is that we'll be doing that in a one time basis and then resolving the issues that are underlying the needs to draw from reserves the budget going forward so really not be independent on drawing from the reserve year after year we're trying to use it as a way to capture on things unforeseeable and clean up things going forward in the budget and i think your suths e suggesting we want the reserve to be there and be visible but not independent on a recess #w0789 reserve wrauflz. >> i mean this is that arrangement with the reserves; right? >> yes. those are the letters where we ended last year.

>> the year positively okay looking for future uses so as then cover unanticipated fees the potential loss if anywhere on the program. >> exactly that's been an stealing positive way to do things and the money will be gone and we'll be making executive reductions to offset this loss as that would have not happened 4 years ago. >> we've given you back the money you had set aside so far health care. >> exactly. >> which i will point out it really a very improved process much more organized and i think that allows the dollars and the reason we're trying to be prudent for our house programs we can use

the same dollars to be allocated. >> absolutely absolutely it puts the right incentive 2, 3, 4 place where a great amount of support from the mayor's office and the controller's office to make that happen on the mayor's side we had the fluktsz in the of revenue same it was our and their problems to stabilize across the years and give us a good incentive to draw revenues. >> very good. >> i wanted to call that out a much improved process i think we have managed quite well and this is an example of which made to make the potential service cuts or whatever we'll cut so a prudent and useful and used

our most efficient processes the past and this is then can be the reserve we can use for health programs. >> very good. >> thank you. >> commissioners any other questions at this point we will be looking at the budget more in depth at the next meeting we are really pleased or i am we have only two or three line items in most of those are actually positive for what they were done and the explanation calendar to what we used to is streamlined in terms of the changes and a grateful credit goes to the department and the management of the finance department thank you very much. >> thank you very much. we'll have more line items next time. >> (laughter). >> okay commissioners we move on to item 10.

>> other business. >> commissioners calendar a reminder we'll have our planning session in april. >> april 19. th. >> okay. thank you. >> and any other business the commission may wish to help to agenda at this point or otherwise we'll going gone to the next item. >> the report back from the joint conference committees. >> the january meeting after the absence of two meetings from the joined conference committee took up the quality management with t the quality measure update which was pretty much in line with the past and continues to show areas that we need to shore up within the experience but with the positive areas for our quality scorecards some of

that you saw from the di rector's report. >> in terms of recommendations where we were centers of excellence and most there was also a discussion of the department of emergency services flow and they were using the new lien process and our moving to try to understand better how systems are getting through and in fact, had an example in which using that process and understanding that there were lower level of patient that might be able to flow through faster i think the flow from 8 hours wait is down to 2 hours or less i'll be seeing and moving to resolve the ability for patients to be discharged and similar improvements on some

of the policy we're now doing they're working hard and with a very extensive report if the integer service and the lien process in regards to that the transition transition and update is showing f it is on schedule and we've been ref the hospital administration report and the hiring and vacancy report they're all on target and the hiring of vacancy is on target i think that was mentioned in today's budget in terms of of what where we are and the delay of the hospital for hiring that was appropriate since you know you're not hiring until you're ready to open the hospital the hiring is #k3406b8 on target in ourour distinction

and their saved they're in nursing and others positions for the opening the medical staff gave us the number of rules and regulations from the anesthesia and services and we also approved the revised pier reference requires supervisors along with pier review from other piers there was also a revision of the emergency department privilege list and the consent form that was revised and in the section we approved the quality and other work over the last 2 weeks thank you. >> i don't know if there are any questions if not we'll move on to the next item. >> 12 is - you seem to mexico that along with other

business so if there is anything you want to speak about or come up with suggestions as my note is that we are looking at a public hearings in the - in the tenderloin area as our next community meeting for this year you'll you will recall we met last year the mission so this is the cap of a community meeting and so we've asked staff to look at it the tenderloin and the areas south of the immediate mid market so we'll understand the changes occurring in those areas. >> i'll be giving us updates. >> we're looking for the appropriate dates holy to have 2 the late spring.

>> any other suggestions from the commission? in regards to the community meeting? if not at this point if you have others please let us know >> the next item please is the consideration of closed session not public comment requests as a motion for holding a collection in order. >> so moved. >> all in favor, say i. >> i. >> opposed? we will now go into closed session and thank you to all the presenter here today and ask only those responsible to be the closed session the commission will

regene in open session whether or not disclose or not disclose is in outdoor aid motions to disclose. >> any further discussion. > all in favor, say i. > opposed? is there any further business. >> there's no further business. >> >> all in favor, say i. >> i. >> this meeting is now journeyed thank youadjourned thank you pr

>> i called this meeting for thursday, february 11 transbay joint powers authority good would you please call the roll >> all note for the record

sartipi has a scheduling conflict. two actors kim, here. peskin, here. gee, here., here. harper, here. we have a quorum. i will call you next item. item 3 medications and directors are not aware of any. >> no communications. next item >> next item item for new and old business >> i have some new business one of the thing that's been going on at the board neglecting has been the required review of our officers. so, at the next meeting were going to have that closed session and at the next meeting is just what we talked about how to structure that review. that will be-in terms of agenda planning that's going to be on the next agenda. okay

next item >> item 5 executive directors report. >> good morning everyone. so, every first four board meeting of the year i always present all vehicle shreds of the prior year. this case 2015. and all we plan to do in 2016. this is a really for the benefit of our new board member director gee so we conceived of could work with them. the various things we presented by the 2015 milestones and a couple shirts. our disadvantage business report as everyone knows that's very important to me. our funding report. our community outreach reports. and i plan or 2016. so mark-a program manager will present this item. >> good morning, directors. happy new year. as maria

mentioned, the content of the presentation includes the milestones the college transfer 2015 as well as committee outreach and what we have planned for this year. starting with the design, 2015 but the fifth will year a successful operation of the temper a terminal. we continue to strive to meet and exceed our stakeholders needs as well as our customers expectations. in 2015, we welcome the amtrak as a new tenant. that allows us to expand our services and also enhanced our operational revenues. also, the temporary terminal is a key link during the part transbay two shutdown in august and september, would you recall parts close the transbay to do some work and some of that load shifted to the temporary terminal. in the temporary terminal was

successful. for the design, we continue to finalize the design. we completed the design of the ip network. it's one of percent completed in december and so the specs were reviewed here we also finalize the pricing and scope for the overhead contact system and the control system for the muni bus plaza. we continue to work with the pg&e and san francisco public utility commission to bring permanent power to the belgian as part of quitting a coronation work and we continue to work with our neighbors. connections to the park and also some of the work we're doing on the sidewalks so were on the same page with them and the construction activities. as you recall, we awarded packages last year. these design packages involve quite a bit of design coordination because we had to

review the design work, expedite approval in order to maintain the schedule so quite a bit of design work for these packages. and the design team continues to request for information and take question from bidders. one important note in coronation, last year was coronated the mechanical electrical and plumbing systems for phase 1. we have the mechanical electrical plumbing contractors on board. the design and assistance for phase 1. we want to make sure what they're putting in their does not conflict with any future elements we might incorporate in phase 2. so the design team worked closely with them with her layout to make sure there's no conflict as we come in to phase 2 to complete the systems we need for phase 2. so we can do that without removing the phase 1 systems. the board awarded 13 fans packages last

year. more than $292 million. for the bus storage, we received budget report in april. we issued project specification and estimates in september. and we started evaluation with caltrans and the cost estimate with caltrans. for our archaeology work, we drafted the first volume of the archaeological resource reports. for the transit center. this report documents investigations we did and the findings, and this is a three set volume. volume 1 is completed. we hope to complete the other two volumes this year. the bus ramp we completed the report and we continue to work with our neighbors regarding the redevelopment parcels. we are obligated in our agreement with the state historical officer to be able to courtney that work for the

wii development parcels and were doing that the block five, seven, and eight. for phase 2, we release the supplemental environmental document in december. we had a public hearing last night and respect receive the comments february 29. we also work closely with caltrans on coming to an agreement with the platform height between caltrans high-speed rail. i do it imagine the board was instrumental in getting the partners agreed on common heights. it was tough to make it happen. we also initiated a phase 2 delivery option study. the reason the purpose of the study is to look at the funding constraints we have for phase 2, status of the work, scope of the work, and determine what would be the best delivery option for phase 2. we hope to share the results of that way.this year with you.

we continue to work with our colleagues in the city on the rail yard alignment study. and provide them with the technical information they need for the study. we worked with mtc in support of the phase 2 cost review. that was done in november of last year. if you recall, mtc to the cost review of phase 1 and phase 2. the next 3-4 slides also you the results of phase 2 of the mtc review look at the scope we have. we shared with them the cost spreadsheets we have. the bottom-up estimates we have. and they did their own schedule analysis to drive at their conclusion and the next life i'll share that with you. we will start by going over the history of the budget for phase 2. if you recall, in march 2008, the board approved the budget for phase 2 for approximately $3 billion. this budget was based on top-down construction methods for the

transit center among mean that the transit center will be built and while the transit center is in operation phase 2 will commence until the train parks underneath the transit center by excavating the transit center. in may of 2010, we successfully were able to secure $400 million in funds. that enabled us to do the bottom-up approach, which we shifted between block scope to phase 1. allows us to build the drain box is phase 1. that was a very important milestone because you moved quite a bit of risk from phase 2 and reduce the cost of phase 2 by approximately $100 million by our estimate. so, thereby the budget for phase 2 was reduced to approximately $2.6 million. that budget is based on a design delivery method and i assume construction will begin in 2011 and continue operations

in 2018. between 2008 and 2013 we continue to update the work on the btx and phase 2. an update estimate, update the scope. new scope was added in 2010, 30% design for the btx was completed in the bottom-up estimate was developed. in 2012, at the 50% design for the train box set out is completed for the bottom-up estimate was completed. in 2013, we share the estimates with the board and this is a breakdown of the estimates. using the base construction cost is about $21.8 billion. we included across the twin 69 dollars for design contingency. the purpose of the design contingency is to cover scope gaps between the 30% design that we have any 100% design. we also included $131 million in construction manager for total construction cost of $2.1 billion. we

updated updated right away cost a stunned recent prices. we also included $182 million in the program reserves. this estimate also assumes delivery method and assumes your operation of 2024. as i mentioned we did a thorough review of the schedule and other items. we look at six main items. we look at our schedule compared to the schedule they developed independently and concluded that seven-year schedule that we have in our budget is sufficient. we also looked at the indirect cost markup although overhead assumption in our estimate was 26%, they agreed that percentage was sufficient. for the escalation, we assumed 3% escalation interest to me. that escalation rate is based on the cost price

index for construction for 10 years. it's also based on what california is using. and mtc's long-term range of plans is using. the cost review by mtc recommends we use 5%. 5% is more in line with caltrans user for construction projects. we also increase the contractor of the resumed just 5%, to 10%. we assumed a 5% based on comparative beds and i have a healthy market conditions. mtc's conclusion was, based on experience, we have on phase 1, and the complexity of the job, that we should assume a 10% contractor fee. our assumption was also based on us offering aside into the contractor in order to attract a number of bidders. the construction budget contingency we assumed 23%. mtc suggested we use 27%. mtc review the scope and they pointed out three main areas

that the scope is not included in the asp. these are listed on the slide totaling $58 million. they asked us to look to increase this item adding another $22 million. we assumed townsend street would be fully closed what were doing the tunneling. they came back and told us we should assume we have to maintain traffic there. so, that would add again $22 million. at that the work would be included in the design contingency we have set aside of 20 $6 million. we also have a trackback maintenance of way tracks right away in that scope was introduced to us in 2015 by caltrans when they reviewed the supplemental administrative costs environmental document. so that's why it's not included in the estimates. they also asked us to consider including $1.85 million for temporary lip

relocation. we assume some utilities be protected in place . mtc suggested we may not be able to protect all the utilities in place. we will have to relocate them back and they put an estimate of $1.85 million on that. the scope will read this covered by the design contingency. in conclusion, increasing escalation grade from 5% from 3% to 5% would add $433 million. the fee from 5% to 5% would add $100 million in contractor fees. increasing the contingency from 24%, to 27% would add $93 million. so, that would add a total of $684 million. the mtc cost review they suggested we add the bart muni pedestrian connector.