report for 2019-2020 and item 13 is proving the proposed service and route changing for realignment of the l.r.v. line and increase in l.r.v. service. approvalling the titles 6 service for these changes and making environmental findings associated with the changes. >> my fellow l.r.v. rider. [laughter] >> yes, sir. i see you once a week or so roughly on the metro. so good afternoon. sean kennedy with the transit division. i'll be covering both items 12 and 13 with this presentation. and before i get started, i just want to remind the audience that everything i'll be talking about today ties back to agency-wide goals. specifically goal two. related to creating -- making

transit a preferred means of travel within the city of san francisco. and i would do a little bit of background before we start this service discussion. transit services budget is roughly 55% of the over all agency operating budget. we deliver a thousand vehicles every day into service and carry about 720,000 riders a day making muni a very integral part of the city and getting around the city and making the city sustainable. none of that is new to anybody in this audience and in this chamber today. we are receiving accolades nation wide. just last month red fin was a real estate company that recognized san francisco as the second best city in the country for transit services aside from new york city. really exciting we're seeing some of these positive benefits, even from agencies and groups

outside the transportation world. we've been making a lot of improvements over the last several years to get that recognition. over the last several years we've implemented 10% service change, service improvements. about 330,000 service hours. we have started an open to new transportation management center. changed the way we do on-street management of the system. we have 400 new vehicles in service and the full fleet will be replaced in two years. so we're making some great strides and riders are noticing. we have, as you know, second year in a row now in the rider survey we have a 740% approval rating which is a 15-year high and so we want to continue that momentum. and as we look into this next two-year budget cycle, we want to continue delivering those type of impressive improvements. this budget we're focus on three

things. one, increasing the rail service. two, implementing the muni service equity both principles and recommendations coming out of the work we've been doing on the equity strategy and then three, making changes based on where ridership is going and where the growth in the city is happening. making sure we're making those changes based on that knowledge and the data analysis associated with that. on the expanding rail service, obviously the number one issue that we hear and you guys hear it all the time from customers is crowding. especially on the rail system. through the great leadership of this board as well as director riskin and director hayley, we are well positioned now to really address some of those major concerns in this next two-year budget cycle through two major initiatives. one is the opening of central subway which is expected to open bit end of 2019. super exciting. obviously we've been waiting a

long time for that project. it's going to have improvements to the k and t lines. and the second is implementing putting into service 64 new expansion rail cars which will allow us to increase capacity on all of our rail lines and directly address some of those crowding conditions and issues that we're hearing from our riders and we already have five of those new rail cars in service and there are apps people have created so you can find when the new rail cars come into your station. there's a lot of buzz around this and some real excitement in the city for these improvements. the second major group of improvements we're looking at is the equity strategy. as you recall, this was first, the policy was adopted by this board of 2014 and the first strategy in 2016 really aimed at getting more and better transit service to neighborhoods that traditionally have fewer

transportation options than the city as a whole. and so, the first strategy was data based and we had an equity working group we worked with from representatives and those neighborhoods. this time around, we really wanted to get to the riders and talk to our ridership and the people going through the neighborhoods as to what was going on and how they were seeing things and they we can improve service for those neighborhoods. and so, the last four to six months we've been doing a ton of outreach, a bunch of different ways of trying do outreach. we have been attended and presented at over 40 community meetings. we have talked to 500 organizations, neighborhood organizations in our eight neighborhood equity neighborhoods. we have held focus groups with our operators. one in each division to talk through with the operators on what they're seeing as they drive through these neighborhoods and drive on these lines and how we might improve

service. so we've really done a real wide swath of outreach techniques and tried to get as many people and as much information as we can. we have two of our outreach people here today, adrian hymn and tracy lynn who both did a fantastic job on getting this information and co a lessing it. the eight neighborhoods we focused on, the services, we did add one neighborhood since the last strategy. the ocean view engelside neighborhood. services that go through these neighborhoods are some of our busiest back-bone lines. the 99r, 1414r, 3838r but there's also some real community-based lines that 10, 12, the 54, the 56. there's a wide swath of service delivery and service types we were talking to people about and how to improve their specific

trips and how they move around the city. and really this slide really shows where we're proposing to add service and the red draws your eye to the fact the proposals are coming out the equity strategy discussions and meetings we've had over the last six months. you know, the top half of the added service table is really rail related. and it would be touching on that in the next generation. but you want to note the bottom half of this proposal, these added services are on the rubber tire fleet on some of these lines like the 12 and the 48. they are cost neutral. we are proposing to be able to pay for these through a combination of grants, as well as some minor service reductions. there's a table on the right that talks about the service reductions there.

i want to point out two things on that service reduction table, one is the 30 stockton. we are proposing to reduce the frequency of the 30 stockton going from an eight-minute head way to a 10-minute head way in the a. m-peak period. if you look a lot the added service table you will notice we are proposing to put 60-foot buses on the 30 stockton so we're not changing capacity. as a matter of fact, capacity is going up a little bit on those lines with the change in fleet size and vehicle size. that is one thing to note. the other one was the enjuda weekend service. the n is the only line on the rail system that we still use two trains on the weekend. through analysis of our ridership as well as just observations, we think we can handle the loads on the end with one car train on the weekend. that said, that is continuing to

be monitored and we can make adjustments as time progresses on changing the way we do that. maybe times a day there might be specific times of day where we need to put two cars on there. for the most part we can do it with one car on the end. and then, as is required by f.t.a. -- >> i'm sorry to interrupt. normally we do questions at the end. if you want to ask it now it's within place. >> no problem, no problem. >> almost done. two more quick slides. so as a federal f.t.a. requires we did analysis on these changes looking to make sure we are not impacting low income and minority communities and we found that no impact and no disproportionate burden on with the service changes. so next steps, we're asking you

today to approve the title 6 analysis as well as the muni equity strategy and we will be implementing some of these changes in the summertime frame and then monitoring or as the years go by to make adjustments and make changes like i said, especially on the end as we move forward. so, that is what i've got and i'd love to take questions. >> very good. director torres, questions before we go to public comment? >> yes. you mentioned in your chart a 60-foot bus. is that the largest made? >> well, i'm not sure if the largest made but it's the largest in our fleet. >> how many passengers can fit into that bus? >> it depends if you look at planning capacity but i would say 94. >> 94 people. how many of them do we have in operation now? >> excuse me? >> how many do we have in operation? >> 60-foot buses?

i think it's 100, 120 range? i mean if you look at for instance, right here on vaness the 49 is foot-foot buses. >> how do they turn? >> they're articulated so they have a little bit accordion looking thing in the middle. and so they actually have a better turning race than the 20-foot buses. >> thank you. interesting. >> anyone else with questions for sean on this part of the presentation? >> so the longer trains on the t third is that those three car trains? i know we're explosion are that and it's something we're seeing good results with? >> yeah, on the t it's just two-car trains. >> what about this idea of the three-car trains in general or the four-car trains? >> well, you guys are -- um. so three-car trains is something that we're looking into.

it's a ways from being implemented. we have a lot of steps to go through to get that certified and moved on into the pipeline of actually being able to be used on the street or in the subway. >> i will note, we actually did not so long ago run a three-car shuttle with success. i think with operational success. i think the issue was whether that was most efficient use of all those cars at one time. my personal hope is with the extra spurs that are coming in including the cross over at west portal, although i realize it's a while before it's fully operational in the computer system that maybe three cars and four car shuttles will be able to work in the downtown tunnel on the t, we're merrimented given the fact it's above ground and there's some other things going on that limit it to two years but even that is an upgrade from where we are currently. >> yes, great upgrade. >> one car only. >> so my questions are these and we will get to public comment in a moment. appreciate the presentation. it was very well done. it was very easy to see what you

were doing and how you were justifying it and what were the trade offs socom laments to you on the presentation. the one california reducing it 30 seconds, it may seem like not very much but that is significant in transit planning world. here is my two questions, one, i ride that line every now and again when i'm actually going for my kids' school downtown and in the morning, it's a crowded line. so is that reduction in 30 seconds, is that only on the one local or will that effect the express routes as well? >> just on the local. >> ok. so it's just on the local. will it be throughout service or will that reduction be outside of the morning rush hour? >> in the peaks. >> in the peaks we're reducing the local 30 seconds and do we anticipate that that's going to lead to greater usage of the express lines? is that what one of the thoughts? >> it could be. we kind of the -- service is so

frequent on that line i almost feel like they're tripping over each other if you look at the gap analysis. we almost think it might even actually run better with a little bit wider service pattern. >> it doesn't effect express routes. that's great. the weekend and juda reduction to reduction to single train i don't have a problem with. but as my slip forecast, the end of juda is a primary way that folks get to the giant's games on the weekend so i assume we'll accommodate that with shuttle service to the ballpark? >> yes, sir. special events and those things are of course -- they have their own service plan. this is just in general the baseline. >> so how wide lands false under special events as well. >> correct. >> those answered my questions. thank you. and i believe we've called this

with 12 and 13 together. i guess it would be appropriate for public comment. >> yes on both. >> public comment on items 12 and 13? >> three minutes, please. >> all right. start with david pillpaw, followed by pete pacapoulous. >> i was going to ask for three minutes so thank you. so on these items separately and together, the citizens advisory council has not yet weighed in on the final service equity strategy or these route and service changes they're scheduled to do so on thursday. i encourage you to hear both of these but to postpone action for two weeks until they've given you their view on the matter. having read the staff reports on both of these, it's not clear to me. i've seen two or three different cost figures for the service equity strategy and these service increases, not clear to me what the cost is to implement

the annualized cost first year the second and third years and how long the lctop grant funding is for and how much the agency would be on the hook after the grand funds expired to continue to provide the operating support for these services. it's another one of those where you get grant funding for the first couple of years and it becomes part of the base budget with our out-year costs when they're not here to fill those gaps. as to item 13, the environmental document is included in the agenda item. i very much appreciate that. it should be a model going forward when there's a one or two page environmental document. if we can do it for this we can do it for all of them. it's not clear to if he if these route and service changes are in the budget or not. the baseline slide suggests that this was not in the baseline so i don't know if it's in the current balancing plan or not.

this is the first airing of the -- sorry. i'm distracted. this is the first airing of these proposed service changes so i have not yet had an opportunity to fully understand what is being proposed. the subway fundamentally, the subway is at capacity during the weekday peak periods and on saturdays and there are no more slots for additional trains. there are some opportunity to lengthen trains by going from one car to two or two to three potentially but there are no more slots so this doubling the n line service looks good on paper but there's no way that additional vehicles can get in there and can get over the road in time. i don't understand how this works operationally. this also suggests the t-line trains would be routed up to central subway and from what i gather, only the n would operate

between embark a darrow and cal train. i don't know if that's sufficient capacity off peak and that creates more bottle necks at 'embaracadaro and additional trains would be going through west portal which is already heavily congested as i've talked about as our weather people know very well. this calender item doesn't talk about the effect on the n express. would that be continued? would it not be continued. >> thank you. >> and just to finalize on the three-car trains, director hayley is interested in three-car trains on weekdays, director riskin is interested in one car trains on the n on weekends. it doesn't reconcile. >> thank you. >> thank you, very much. >> pete. >> followed by bob allen. >> i'm take that. peter. >> i wanted to address a few

points here. first of all we are certainly in favor of and pressure tive increased funding particularly as it serves our communities of concern and filling those gaps. we do want to address when we see documentation like this, certain things we feel are still missing that we are greatly concerned about that we hope to see more fully integrated when documentation comes forward and planning in front of the public and the whole community about which direction we're headed. so mission community groups for example have participated quite heavily in this process through map 2020 as well as the equity strategy process. and yet we don't see still the second half of things that we want to see and that equity is a holistic process, it's not just about transit and routes right it's about what are the impacts we're having on our most vulnerable communities who the goal is we agree to serve better, right. so just looking at people who are concerned when this came out for example, that the 14 red lanes project is still listed as

a successful equity outcome when we're still running around at high speed trying to manage the harmful impacts of that project. i just talked to another business a couple of days ago, they're also closeing and they also attribute the red lanes as being the thing that finished them off like many before them. in fact, the city's own data shows a quarter of the businesses along that corridor nearly were harmfully impacted by this project. our own surveying of the corridor is showing exactly the same numbers at this point and remember these are only the people that are still in business. some people were driven out of business so they're not around to answer the survey. we are working with other city departments on this issue and we appreciate that because it's going to take amount of work to help stabilize that corridor but an example that we want to see going forward, what we want to see is first of all we don't think of the 14 project as done and we'd like to see that thought of in this equity context is how are we still

looking to make equity improvements. to look at a couple examples of those things, we aren't seeing an increase in pedestrian and car accidents. a decrease in those accidents, right. the perception in the community is it's still a less safe outcome. despite the fact we moved half of cars so we removed half of the cars and they're not going down and people are saying we feel less safe. likewise we're seeing there wasn't a plan for those businesses that support this equity community outcome. so what are we doing for those businesses as we go forward? i think that looking at the holistic version of it we'd like to see more than anything, language and planning, especially as we look at things like the 16th street project coming up. who are these changes effecting and how do we start with an equity first lens so it's not a mitigation thing that comes later so we're doing social yo economic studying and seeing housing effect and the

communities they support. >> thank you, very much. >> thank you. >> bob allen followed by herbert winier and ace. >> allen, welcome back. >> good afternoon. bob allen. we were on the working group with the staff and i wanted to start for the equity strategy by thanking them for all the work they did and the time they took. we think it's a good step forward towards concept actualizing equity in this system i appreciate the staff's time. the first round of recommendations just some questions and concerns other folks just will address going forward. we made a bargain with this process saying we were going to look at service improvements in totality in terms of capital improvement, line management and things like that. not just putting in doll as for service. recognizing service improvements are a product of all those components. it's concerning to see the totality of the improvements and

it's completely revenue neutral. at some point, this has to be putting more money into increasing service and i know that staff is working along those three da convenience dime. there's just concerns about is that the approach going forward. are we going to have the sum of these changes be revenue neutral? it raises some questions about what we're really going to keys out of the system and how much of this is collapsed with the muni4 which i understand they talk to each other. i want to be aware of that and hopefully it's our jobs to get revenue for you on the operating side to help folks find those funds. the red lanes project is compl complex. even though i'm on that bus often, i'm not from that community. i've been talking with staff about this from the beginning. this is a really good structure

for looking at how we plan and do service equity changes but i agree with the speaker that equity is more than that and it's about addressing a larger context and larger process that's happening in the city around displacement and what development means. and i think the process, i think board and it's complicated in the city and a lot of that has been going on outside of this process. but whether that project has pushed some businesses over the line or hasn't or how many it has, i think we have to, if we want to go forward with an gres i have network of transit priority lanes to something we really believe and our allies believe is essential we just can't put more money in the system we want to get control of the sheets from the shuttles and the tncs we have to figure out how we do those projects. there's not one community. you will do red lanes that's going to like it. that being said, i think to move forward with equity, we're going to have to all figure out and i

know director ruskin will figure how how we do it in the beginning so we don't have a push back going forward. >> thank you, mr. allen. >> robert winier followed by ace and peter strauss. >> welcome back. good afternoon. >> herbert winier. i have two concerns. one is on theel terville line. i appreciate it will be increased during the rush hour. that's all to the good. but i really haven't seen any improvement on the line. i have to walk a long distance to the bus stop to get buses that haven't been added to the system. and it's a very long system. that extends from downtown to the zoo. that is a very long route and it's deserves a lot of coaches

for that. now, the people have paid dearly for the project. it's really hasn't -- it's made life miserable for a lot of people, including the loss of businesses and the rest of it. so the least people should have is more coaches that are available so to make that long walk to the bus stop at least make it halfway worth while, the other concern i have is the one california. you are going to decrease it by -- you are going to increase the waiting time by one half of a minute. i take ta line. that may not be so noticeable when it runs normally but when you have late bus and missing coaches you pay dearly for that. so that ought to be watched very, very carefully. it's heavily used and it's heavily in demand and at the same time, people should not

have to wait for long periods. i have experienced that. so this should definitely be taken into account. it's not a question of supply and demand it's a question of the actual need. that's what public service is about. to apply market system principles to a public transportation system is berserk. you need to address needs. >> thank you, mr. winier. next speaker, please. >> ace is the next speaker followed by peter strauss and he is the last person to submit a speaker card. >> thank you, commissioners, this is probably one of the first times coming before you. >> welcome. >> well, thank you. ace in the case is not too much welcome here at city hall. i call it chilly hall. commissioner, good to see you. director now. and i do know torez, i know your son had to be a commissioner. i go to his meetings all the

time, yes. as a matter of fact, he serves on housing authority. and the oewd. >> pro bono, yes. >> yeah, i got other things to talk about that. i am here specifically, i just happened to stop by because up by your office yesterday. whatever you do i approve because they don't say ace you ain't speaking on the item. one guy didn't say anything. i approve whatever you are doing. i thought it was something said equity i thought it was about race. they're talking about transit. i have something about transit. because you guys are over the ascot who gives out the permits. this year we go into the seasoning where i call field no more. i'm the embassador, not the bastard but the embassador. no support in the fill more and i wonder why? i'm not here to talk about those politics. i'm here to talk about the ascot. the permit. we have three major events

coming up on fillmore street. i'm the fillmore corridor embassador and ascot has been treating me wrong for the last couple of years, they treat me like i look like mr. mcgee and don't know what i'm doing. let's do this right now. i'm going to be coming back to talk about that. ya'll got a couple of issues we're going to talk about. it ain't the arena to talk about it now. you know what i'm talking about. anyway, the ascot must be stopped in the fillmore because the jazz festival had an agreement with the fillmore years ago and we have no merchants and we don't have the right for them to ex down here and they done came down to the community years alcohol and we ain't got nothing from them. we had an agreement but it's over. we don't want them to call south of the market. streets fillfor street. we're going to negotiate with them. i'm here to talk about the june team. black history. the emancipation of -- i thought

you were talking about equity. i'm coming and saying stop all permits for all three events. until we find out where is the equity for our community. on the different comments come major sponsors we don't know nothing and we don't get nothing. that's going to stop this year. my name is ace and i'm on the case. >> thank you, very much, ace. mr. strauss, you are up. >> thank you, good afternoon commissioners. peter strauss, director on the board of san francisco transit riders. i've been before you many times talking about the need for the agency to move into a mode of expanding money' service so clearly the types of measures that are embodied in these two items are things we approve. i want to commend the staff as bob allen did for all the excellent work that's been done in support of the equity strategy and the agency as well as the staff for embracing this concept as you have.

as bob said i'm concerned about the description of this is being revenue neutral. i'm a little doubtful whether it can be done on a relevant neutral basis. i see ed shaking his hands. it should not be done on a revenue neutral basis. you need to do the right thing in terms of the equity strategy. a few other things, the t third. i want to urge you to move to two-car trains on the two third and advance of opening this central subway by decoupling the t from the k. i see some of you nodding your heads by linking it to one of your two car services. the l.m. and shuttles and connect particular from the k connecting it from the k. with respect to the mjuda i'm skeptical of the move to one-car trains on the weekends. that's a step in the wrong direction and i'm clearly that's

not something i think is even possible and desirable and i've spoken to staff about that. i don't think it's something that should be done. and lastly, i want to urge that the things in here, i want to point out as i think you know these are not in your current budget. all of the budgets are baseline and do not include expansion items and i want to urge you in no uncertain determines to direct staff clearly to include these in the budget. that's obviously something that is necessary to give this teeth to make it real and to bring it about. and that has not been done. please direct staff accordingly. thank you. >> thank you, very much. any further public comment on items 12 and 13? seeing none. public comment is closed. directors we already had a question session with mr. kennedy and mr. riskin, are there any other questions or

comments? >> >> i do. i just wanted to say, first off, i think some of the issues that people expressed about some of the cutbacks or delays in time do make a difference. i think how are we going to allot for instance, where say drivers don't show up and there are -- the problem isn't just that making that change is one thing but we don't always have full drivers on lines and so when there's a -- when someone misses, are we going to accommodate and back fill in that case or can we do that? >> we do have that. we have the extra board so we schedule more people. so if someone sun available to fill their run we have someone to back fill them to fill it. there was a time quite a number of years ago where we didn't have enough operators to fill all of our runs plus the extra board but generally we're

staffing that extra board now so we can fill the open runs. one of the reasons why we sometimes have gaps on the line have to deal with vehicle issues and one california as we heard in the public comment, i think the person said that the plan seems ok as long as the bus are reliably running. the good news there is that the buses that are running on that line, which are admittedly pass their use of life will start to get replaced as early as next month. we should have our first new 40-foot trolley coach going into service within the next month or so and then all of the replacements of the trolleys that serve the one california and many other high-use lines, will be coming in over the course of the summer and the fall so we have the staffing issue i think largely addressed and the vehicle reliability will significantly improve as these new buses come into service which will all be in service bit end of 2019. >> i guess the other issue,

especially on the 1 california. some buses go all the way out and there's some that turn back at various places. have we configured all of that as well in looking at that? >> yes. is the question -- >> because we have not every 1 california bus goes the full length of the time so if we're slowing the time thinking about how we make sure we are servicing -- >> we will have slotting the service. so we make sure that especially portions isn't as much time as the outer portion of the line. >> and i think so that was great and i also thought that the comments mr. strauss' comments about the t-line adding two-car train sooner would make a lot of sense. so if we can do that. i want to thank staff for the equity strategy and looking further at how we can make changes to be responsive to

where we have the greatest needs and it's super important. an issue brought up by others and something i thought about a lot when i was in d.c. last week was mtc who has merged with a bag is how we don't really do a very good job of the land use transit intersection. i do think when we start talking about equity, the reasons that we have -- that people are stressed out have less to do with transit but more to do with the land-use issue. and so people are concerned about the changes that we make today will they be able to take advantage of them in the future? things that run better or transportation improvements, et cetera. so to the extent in future i had races of the equity strategy we can work with a planning department around a little more land use-based conversations in that area because it is important the way neighborhoods are evolving or changing because those travel patterns will also change a little bit within that and so again, i recognize that is not the way that our equity

strategy was set up and that is not the big step forward and i'm very much thankful for the agency for doing this and i think if we can figure out a way in the future to recalibrate so they can look at land use or work with a planning department around land use because they've got lots of development contemplated in many of these areas of the city as well as things going on in the retail and other kind of other things on the streets. if we can look at that and going back to the topic that we were talking about before, if we can monitor as we make these changes around service reductions, whether or not it's effecting ridership and lag times and waits and have a mechanism if we need to make adjustments to go ahead and do that i would recommend that. >> if i could speak to those, just i did sean mentioned it. it was on the slide that showed the changes.

these are ones we happen to be doing coincident with the budget and they trigger the need for the title 6 analysis so we brought those forward in a more explicit way but every time that we do a change of operatorshifts, which we do once a quarter and every six months, we're constantly making those adjustments so we're saying if we need to put a little more time or make other adjustments, we're continually doing that so i don't want anyone to leave with the impression that this is once for two years and we're locked in stone after that. we'll monitor and a change we're proposing on the one as well as the increases we're proposing will monitor to make sure they work and make adjustments otherwise, with regard to the comments on planning and the public comments surrounding that i think you are all spot on with those. whether it's within the equity

process framework or not, we are front loading those considerations and our project planning. after we were done with the project in the mission, where we put in the transit-only lanes. one of the next muni forward projects was to do something similar in the outer mission and we were requested to, because there was a process starting by the planning and economic development departments to kind of fold ourselves into that process so we would be doing that planning with the community but kind of in a coordinated way with the any kind of land use or other changes that are contemplated there so i think that perhaps speaks to the approach that you are suggesting. likewise, we received a grant from the state that will fund our bay view community transportation plan and by doing a plan at a neighborhood level

like that, we will work with planing and others in the neighborhood to make sure that beer understanding any kind of land use dynamic that will be impacting transit or that we need to be accommodating for. particularly coming at it from an equity perspective. i will just note, as we've told you, the large majority of the beneficiaries of the mission project, as imperfect as it may be or unpopular as it may be, the great majority are very low income and primarily minority individuals so i think it does advance our equity goals and a lot of them mentioned and we're committed to working with the other city agencies to work on mitigating and any impacts whether caused by or enabled by transit or otherwise. >> thank you. i just had -- i was wondering the comments i'm curious as well about the revenue-neutral ideas

behind these service changes. because i understand that there's some grant money now and just moving forward, obviously we wouldn't want to take these service increases back later. so can you speak to that and whether we have plans to increase the plan moving forward? >> so if i could -- so sean doesn't get in trouble with our award-winning c.f.o. first of all, to the end of the last member of the public who spoke, the end of comment was the whole purpose we're bringing these items today for your consideration is that with your approval, we will take that as direction to include them in the budget. and there is budgetary impact. it is a surface expansion and i think that the concept of revenue neutrality was limited to a portion of what was proposed but it was accounting

for new state operating grant funds as part of that neutrality so it was a creative expression of neutrality. we're adding service which adds ex pension but fortunately we have now additional operating grants to cover that ex pension so it's not detracting from other parts of the service. i think that was the concept of the neutrality. the operating grant is an on going source of revenue. it's not guaranteed like any other operating grant is not but then again there's no part of our operating budget that's guaranteed. so we are linking the increased on going costs that we would be using to implement this, should you approve it, with an on going source of revenue. so we're very mindful and the discussions for example, of using prop b funds or fund

balances we'll talk about in the next item. we're mindful of how we're committing dollars because we don't want to add service and have to cut it because the funding source drys up. again, our fair revenues and our parking revenues and our general fund revenues as well as the operating grants, small as they are that we get from the state, none of them are guaranteed. but we are very mindful of linking on going improvements and we do hope these will be on going service increases with on going revenue services. >> very good. any other director comments or questions? director ramos. >> for putting together this work. i have the pleasure of seeing them out there in the streets in

the community doing this work and it made me feel great to know that we're talking to as many different folks as we could. i want to express my gratitude to the equity working group. san francisco transit riders it was great to have you folks engage. bob alan from urban habitat and everyone else that was a part of this. the more folks we can get engage the better off we are and the staff are being so robust and making sure to include as many folks as possible. the appendix in the report is impressive. i also think it's important for us to acknowledge the board of supervisors also for expressing the urgency with which we should be doing this as well. and of course, more than anyone else i want to thank you riskin for making sure it came to be to where it is. what we find in this report and

in all the -- and i also wanted to thank you for taking in the opinions of the drivers and the operators. i thought that was really cool. and it looked like they were really excited. the attendance looked good at least. >> we should be here to tap into it. i want to make sure that we do recognize this as the heart of why we are doing this. why i am on this board. it's really about serving those that really don't have a lot of other option of getting around. i'm sure if our former beloved chair tom nolan was here he would have a lot to say about how important this work is and how we should strive to fund it in whatever way we can. i would just reiterate that.

i hear the concerns about the transit-only lanes. i certainly empathize with the impact it has on communities. no one likes to see the retail having a harder time than it already is in this current environment and it is actually something that i think we're seeing all over the city, it's not just on the boulevard with the transit-only lanes but we're having a hard timekeeping store fronts open anywhere as i'm sure they can speak to. that being said, when we do these projects with these transit-only lanes and i've said it in the past, i would encourage us to make sure we're doing everything we can to work with the economic development. i think seeing what ac transit has done in international boulevard as they implement their b.r.t. that they shared lessons with us a while back but doing their due diligence to work with the city on partnering

with the city's economic development team to resource all these merchants to help them get their business models up to speed and to leverage tools they might not be leveraging, yelp and online web pages. all these things matter in today's competitive economy and especially with the rising cost of real estate in san francisco it's challenging to make a profit here of retail establishment. so i think it's important for us to make every effort we can to acknowledge and the concerns that have been brought up and everybody else working along that corridor. all that being said i think that is also very important for us to recognize the earlier on -- we know our population is growing and it should be a cause for alarm. this is one way for the growing

demands that we have in our system and this particular effort i think really, for me, shines a light on where we should be putting our efforts. if we have any capacity to expand service this is where it should be. i am going to urge this board to really push for us to do whatever we can to fund these improvements because they really are a lifeline to so many that are having such a hard time getting to work and jobs that aren't as for giving as others might be. like when have a time clock. if your bus doesn't come you are out of a job. it's important we get all of these service recommendations implemented. so thank you very much. >> anymore comments or questions from directors? if there are none i'll entertain a motion on these two action

items. >> motion approved. >> second. >> all those in favor. >> aye. >> well done, director ramos. >> thank you very much for the presentation. >> item 14 is the presentation and discussion of the fiscal year 2019 and 2020 operating budget. including various options. >> thank you mr. chair. so this is our last time coming before you as a informational item. before coming to you potentially at your next meeting with recommended budget. with your actions on the last two items we'll take that as your direction to incorporate those into the budget so i do have a briefer presentation for you. just focusing on the operating budget. not the capital budget. we'll bring you that in more detail. if we can go to the slides, we have start off with some good

news. which is, i had previously showed you a baseline that had some updated information in terms of both revenues and expandtures but more on the revenue side are revised baseline shows us between 10 and $30 million on the positive side, which is a better starting point. the next slide shows what has been included. that includes additional -- improved projections of general fund baseline revenues from the controllers' office. looking at our actuals from our parking garages, plus the now partially implementtation of the new revenue control system within our garages. we're able to project a greater revenue from our parking

operations for fiscal '19 and '20. i mentioned to you before i asked our operating divisions to see where they can tighten their belts in terms of their baseline budgets. they were able to find a professional service contract line that they could reduce and anticipate savings on fuel as we move to more fuel efficient vehicles. and inventory as we move to more modern inventory systems as well as a number of other items that were able to help us on the expenditure side. conversely, there are some contracts that we know of since the first baseline was developed that are trending towards increased costs, such as our paratransit contract and some others that are listed here. a few other costs that we know of that are going to hit us have been folded in here. so we didn't just fold in the good news on the revenue side,

we also folded in addition alex pendtures that we're aware of. with that, that revising our baseline to a plus 10 in the first year and plus 30 in the second year. as a number of folks said during public comment on the last items, it does not include the things that we've been talking about such as the increase in service. it does not yet suggest the use of reserve funds or prop b population baseline funds. and it doesn't address some of the other transit needs that i'm going to walk through now. this is what i've been showing you for the last couple of presentations. we just talked about parts of the first two. we now have your direction that we will integrate the muni

equity strategy into the budget as well as the introduction of the new light rail vehicles into the budget, which includes the support for essential subway. we also have the bus yard opening as well as other investments and while, to some 36 to $63 million may look revenue-neutral to us it looks like it's an ex pendture we need to find revenues for that we want to address. i have a little bit more detail on these. we've mention inside but haven't talked about it that much. this facility is one that has been in the planning for quite a long time. the first phase of which opened a few -- or was completed a few years ago so we've had some use of it as a fuel and wash facility. next month we'll have substantial completion on the second phase for a planned opening of june of another full muni bus facility.

it will be the first muni bus facility opening in a generation. the need for a facility is one we anticipated a long time ago, which is why we had planned for it a long time ago. it was due to expansion of the fleet. we will have had, by the end of 2019, a net expansion of bus fleet by about 80 buses. that's about a 10% increase and that also includes replacing some of the 40-foot buses with some of the 60-foot buses. so the longer the bus the more maintenance that's needed. it's got more doors and it's got more wheel sets. so the maintenance demand has been increasing yet our capacity to meet that demand has not. this facility will give us the capacity, the capital cost to have been project is fully funded. these costs represent what it will take us to staff the facility. to the comment made by the c.a.c., we do anticipate the

operating needs of these capital projects for this and for the essential subway when we develop the projects. we don't have the funding lined up because some of these projects have 10 plus year lead times. but these are -- it's not a surprise we need these funds. it's just that they haven't -- the baseline is what we're doing today and we haven't had this facility up until now. next the light rail vehicle expansion, there is a net cost to this expansion. it's 64 vehicles plus the additional four that we'll be putting into service fora for aa events. the good news is that these cars, on a unit basis, will be less costly to maintain than the current cars because as you know, as you heard from mr. hayley, they were designed for reliability and better

maintainability. it's more cars so we need people to do the maintenance on those cars. what is also included in this expansion, are the station operations for the central subway, which starts towards the end of this two-year budget cycle. so we'll have new station agents, custodians, stationary engineers, the folks that main the stations will have a bunch more stations in infrastructure that we'll need to maintain and you can see the cost associated with that. and then finally, a smaller piece but one that our transit staff thinks is a really critical is with the new systems we're putting in place the new vehicles we're putting in place. the types of -- the ways we've been training our staff and providing oversight to our staff meets the change and so recognizing how the nature of the work is changing and the complexity of the work to some

extent is changing we think a modest investment in training and support for the modernization of the fleet and of the systems in the subway even having a vehicles are maintained and is worthy of investment and so there's a small amount that we will attempt to incorporate. so that is on the expenditure side. i did want to just do one more circle back in terms of fair changes. please stand by.

s the meeting behind this was really to focus on our occasion riders to provide them a more fleckible prepai

flexible prepaid fair and to i incentivize the trip. if the trips are free then you have paid for it you may choose to use muni instead of a less sustainable option and some of the statistics we looked at. now on clipper, 97% of users they take fewer trips so we don't see the revenue risk as being very high. we looked at ac transit sales and they are priced at 2.22. not getting a whole lot of use of that path so we worried that pricing it above that 2.0 might not result in good utilization. so base on that, and internal stakeholders discussions with transit and rcac who recommended that 2.0 level. we wanted to -- just to get your feedback on that choice and to see if that may be a good place for us to start with that

product. there weres about access and accountable to lower fares. i think we can all understand the technology that clipper has. there's not a whole lot we can do about that in the short-term but we really do feel like it provides an alternative to that. there's been a lot of work that the communications department has done. a lot of advertising and signage and targeted promotions. improving the app capabilities in and of themselves and also it's interesting to node that 20% of customers use papal which is not an option on clipper and that does allow folks to be able to load value on this app. and just very quickly.