morning, i will call to order the transbay joint powers authority meeting for thursday, april 11, 2019. >> chairwoman: i'll note for the record that director chang is joining us. [roll call] >> mr. chairman, you do have a quorum. item three is communications and directors -- i'm not aware of any.

>> i will need to recuse myself from, i think it is the last item on today's agenda, which is an -- po terrible agreement between the t.j. and the s.f.. >> chairwoman: item five, executive director's report. >> good morning, directors. i would like to first update you on the efforts to date to reopen the transit center as soon as possible. we're working on several parallel tracks, which include repairing the girders at fremont street and the buildings at first street. continuing an exhaustive review of the facility, fully cooperating with independent review panel formed by the metropolitan transportation commission, and completing a facility-wide life inspection program with c.d. over sights.

the reenforcement of the girders are well-under way. and they remain on track to be completed by june 1st. you will see an update this morning from senior construction manager, dennis pershon, with the schedule, the status of the repairs effort, and our plans moving forward to remove the shoring on fremont street and first street. we expect the fremont street shoring to be removed as soon as this month, and the first street shoring to be removed early next month. as you know, we are continuing monitoring the facility, and we have affected thousands of records, inspection reports, and other documentations as part of our facility-wide review. to date we continue to find no other fissures or issues, and we believe the issue is to be localized to the fremont street location. as you know from the presentation last month,

we have determined the root cause, and the independent review panel agrees. the testing laboratory has already submitted the draft final report of the findings of the root cause of the fissures so they can conclude that portion of their work. and why we do not have yet that all-important reopening date, the t.j. staff or property management are taking all of the necessary steps to be able to reopen the facility with a smooth opening to the public. excuse me. and we are meeting regularly with our transit operators so that we are able to resume operations as soon as possible. we want to be ready on day one with a vibrant park, active pop-up retail opportunities, and a clean and well-functioning facility. in addition, we are developing a comprehensive communication plan to properly inform the public about the reopening, the reenforcement efforts, and

the regress and independent reviews and instructions that must be completed before we reopen. the staff will be presenting the communication plan to transit agencies, marketing and communications team over the next few weeks. and we have already begun presenting updated information and reaching out to the stakeholders and community groups. you will receive a communication plan presentation at our next board meeting. staff is also working closely with the appropriate city oversight agencies, including the san francisco fire department, the department of building structures, to recommission the building as soon as possible. i would like, again, to thank the public and our transit riders for their patience. we owe them a thorough review, and i know they're eager, as we are, to reopen the facility as soon as possible. moving on to phase 2 and the downtown extension,

starting with the status of the environmental documents, as reported earlier, the process for the documents concluded when the t.g. a. board approved the report in december. there was no further action or public process required for the environmental statement. as requested by the federal transit administration, t.g. p. has reform mated theated the template. and we have confirmed to f.t.a. that no recent venes havevents have changed the policy. f.t.a. continues to work to finalize the decision, which we hope to be issued soon. i really hope to have a report before you at the next meeting, that that effort has been concluded. in regards to the design

development effort, as you know, the design development effort for phase 2 is currently on hold, pending the completion of the pier review by the transportation authority, and the release of the prop "k" funding. they held a kickoff meeting earlier this week, which the t.g. p. and all stakeholders attended. the program included the current government and organization structure, various oversight efforts for phase 1, including the state level with caltrans, and the regional level with m.t. c., as well as s.f.controller's office. and we provided an overview of the downtown extension, that includes the technical studies completed to date. the cost estimates developed over time, current funding plan with the various potential funding forces, an sources and t

is conducted to today. and there is a presentation by cal tran high-speed rail at the kickoff meeting. the next step is stakeholder interviews, and review of international and domestic rail project compacts, and delivery strategies, and review of government and oversight models, and preparation of the final reports. i would like to note that both directors lipkin and hersh attended the kickoff meeting. the pier review is expected to be completed in mid-june. i would like to thank director chanc chang for undertaking this effort. and they have been worthing so this can be completed and work on phase 2 can begin as soon as possible, so we can complete it at both the

state and federal level. as we have already heard, the san francisco superior court judge has dismissed the lawsuit last year to block the use of project three, the toll increase on the area's state's own bridges to pay for the public transit upgrades. this paved the way for the approximately $4.5 billion -- sorry -- $4.5 billion in funding for bay area projects to move forward, including the $325 million for phase 2. the group that filed the lawsuit has indicated that it does not intend to appeal the judge's decision. if that stands, funding could be available as soon as this summer. as well as the operations of the transit center. in regard to the pier review being conducted by the american public administration, which was requested by the board in

december, as i reported last month at the board meeting, the kickoff meeting was held, and the workshops were held march 11 through march 13th. and we expect a final report to be presented to the board next month. director chang has requested we pro vie the provide team with an afta report once the draft is completed. i hope to be able to do that-within the next two weeks. moving on to operations, we continue to make progress in our leasing efforts. at this time, i would like to ask martha valez to provide you with an update on the leasing efforts, as well as the tenant improvements progress. martha? >> good morning, directors. i'm going to give you a brief update on the leasing and tenant improvement updates. martha valez, facility

director. this slide is familiar to you. it depicts the activity on the ground level and various stages of discussion. and if compared to last month, you'll see movement of prospective tenants as they are rearranged for f-fit. as example, the interested venezuelan restaurant was shown at space 35, and this month they were moved to space 113. at this point, the ground floor, the second floor, and the rooftop spaces all have at least one interested party. the highlight this month is there has been an uptake and interest with inquiries and tours starting to come back, whereas a few weeks ago, there were none. i've indicated one lease as being active because it is in the second round of comments. however, we have six or seven that are earlier in

the lease process. this particular space is for the second floor, so the likelihood of it being presented to the board in the near future is high. also this week, lincoln submitted to letters of intent to the t.j. p.a. for approval. what this means is that the major business terms have been finalized, the financial vetted, the rough order of magnitude on their tenant improvements have been worked out. these are all candidates for strong submission to the board in the near future, in that they have expressed enthusiasm for thbeing at the center by targeting upcoming board meeting dates. this slide is the same as last month, with no change. we're still thinking that the center will be fully leased by the end of this next fiscal year.

again, this slide notes know change from last month. with this slide and the next two, i'm going to provide a general update on the status of the tenant improvements. lincoln has just completed an r.f.p. process to cost out the landlord's improvements for the noted tenants, plus the interiors for penga and pa pamaba and charlie's chief steak. and then it is split between this round of r.f.p.s, and the next round the mechanical/electrical will be included. this round included the topping slab and demizing walls for the unleased spazspaces and heat pumps for all of the spaces. as demonstrated by the

activity and interests shown on the previous slides, we're far enough along at this point for lincoln to do a major portion of the landlord's work for leasing spaces. the two main benefits of doing this are economies of scale, and when the walls and the topping slab are in, prospective tenants will have a better sense of the spaces, improving marketability. this is a big-picture summary of where we are to date on the costs. these are all in numbers, including landlord's space building work, and tenant improvement allowances, plus fees, soft costs, and contingency. the first row includes the initial work of the t.j.p.a. offices, the former lincoln office and the mail room, plus the lease spaces, the demizing

walls, and both purchase of the heat pumps for the eunleased spaces. so you can see at this point we're at about $1 million under budget from the original budget. lastly, note that next month a request will be made to move 10.5 million in funds from program reserves so that the leasing efforts can continue unimpeded. this is the same slide that was presented last month with just a couple of revisions. those are cross-hatched. i want to know that these are still estimates. the actual schedule for the first round of r.f.p.s is currently being developed by turner s.p.d., and these are the ones just put under contract. on-site dental was one that was cross-hatched, and this was to revise the estimated timeframe because they took a pause

in their moving forward with their design when the beam incident occurred. and we slightly modified the estimate on charlie's chief steak, and it is more efficient for turner to do the tenant work. and starting with suite 105 down did not change. it shows the timeline of when the lease deals might be signed. the timeline includes the letter of intent, the work letter, discussions, the negotiation time with the lease signing, as indicated by the "x," and then at what point revenue may start. so i have a couple of more points that i want to address before i am able to take questions. so this week, at the c.a.c. meeting a question was asked about a grocery

store interest at the transit center. in general, the transit center has been opening to leasing space to a grocery. when collier's first started marketing, they unilaterally reached out to about six different prospects. they indicated they could operate in spaces that were less than 5,000 square feet. at that time, that space was available on the ground floor to accommodate that size. none were interested in the second floor. these prospects were local and regional, consistent with the approved marketing plan. of the six, four responded. of the four, two took next steps to tour and submitted letters of interest. during the vetting process, they all fell out for mixed reasons. for example, they decided that the location would not generate enough foot traffic because there are alleys, or there were loading dock constraints.

and another reason was lack of parking for their costumers. the second item i want to inform you about, i've been corresponding with a.t.transit, with regard to costs because of the closure. so that concludes my report. i'm happy to take any questions. >> any questions? >> can you go back to slide seven for a second, the one showing kind of the projection of the $1 million under. when you brought past whreaseleases to us, you highlighted the t.i. base line and the base building improvements. is this what is basically -- that's where work has gone through, and now you've bid some of it out? is that what we're seeing, that you've stayed on budget on both of those fronts? >> correct -- actually, let me move to -- hopefully you can read

this. >> this is a more detailed slide of the information, but, yes, so the top shade, graded area are the spaces that are already under way, the former lincoln office. you can see the comparisons there. the second shaded area is, yes, the spaces that were put out to bid for, well, for t- well, with the most recent r.s.p. and the other is what will be putito i put out in may. and we realized the economy of scale with the demizing walls and the heat pumps, and the topping slab, and we got favorable pricing on the

competitive bidding. >> if i may clarify, the million dollars is a real-life savings because they are based on bid amounts we received, plus leases that we excluded, and the t.r. allowance -- right now we're a million dollars ahead, and we have $14 million more to bid out for the leases. >> excellent. thank you. >> chairwoman: anything else? >> with regard to the leasing update, i think it is a pretty encouraging story. i think it is good to see that things are moving forward, and that the interest is back. and the way it is being presented now, i think is very helpful and transparent for the public, especially the timeline slide, showing -- so we can actually see when things are going to happen and see what's changed from previous months. that's great. two questions with regard to the center itself. so you said that the completion of the subsequent review is being done now and it will be sent to the pier review

committee. i didn't hear a timeline for when that will be going to the peer review committee, and when we expect their final determination. do we have that timeline? >> i will have ron answer that question, but the repair will be done by june 1st. the building-wide review, with the exception of the sealinceiling work, that will be done by june 1st. the only item that remains to be unknown is the -- our document review and investigation regarding other locations that could be susceptible to fracture. that work is on going, and it is not clear to us right now when that work will be done. but i think in the next couple of weeks, we could probably get more clarity. there is a lot of information that was given to us by the contractor,

and already the designer is reviewing. we still need two sets of documents from two of the subcontractors. one of them we expect to receive at the end of this week. the other we expect to receive at the end of next week. once that work is done, we will have a better assessment on when that work will be done and turned over to the peer review for concurrence. >> okay. and the second question is: i know we have preliminarily identified the cause of the failure -- i guess my question is: what's the process and timing for finalizing that determination and then essentially making the agency and the others who have incurred costs, that martha made reference to, whole? >> let me have ron address that question. as far as we're concern the cause of the construction issue is not a design issue. >> so what's the timeline. >> good morning, ron alemeda. i was going to touch on that in the construction

update. >> we can wait for that. >> well -- but, in general, all of the facts that have been found. the determinations are made. it is pretty much just final reports -- the final findings are in place. the final format of reports is what is in play now. in terms of reconciling the accounts and accountability, as i put it, is ongoing and has begun already. in terms of taking care of those that have been impacted and also addressing those that are responsible. so in terms of timeline, is this a matter of weeks, months? >> probably over the next couple of months. we want to make sure that we advance correctly, solidly on the facts, and it will be a process that will go over the next

couple of months. but it is already initiated and in play. >> okay. thank you. >> any other questions from directors? >> i would like to ask dennis to update you on the project report. >> good morning, directors. i'll present the quarterly report, labor and labor statistics, for our p.l.a. quarterly, report this quarter. meeting number 28, which means we've been doing this for seven years with quarterly reports. iit will be continued until phase 1 construction is complete, so we're getting close to that. i'll cover phase 1 in my

construction update. we presented to the union, gave an executive director report, and similar updates were given from the board's meeting in march. we gave the same on construction, retail, and i gave them a phase 2 update while they presented us with a fair ap prenapprenticeshipapprentice. we've had no work stoppages, and there were zero recordables in lost time. the last slide for this, i would like to keep you updated on how many hours, and we're now over 5.6 million hours that have been worked. and then there is just the geographical breakdown in the bay area, where this particular labor is coming from. so with that, just a very short update, quarterly for the p.l.a., and if there are any questions? >> questions from board members? >> thank you very much. >> chairwoman: we have one member of the public who would like to comment

on the p.l.a. update. mr. patrick. >> good morning, directors. jim patrick of patrick and company. i want to talk about this project labor agreement. i appeared before this board and spoke against it when it was adopted, i'm going to say five years ago, when this project was in inception. it called for paying the highest price for labor. i have a purchasing department in my company. i go to them and say, get the cheapest price. this board says, no, no, no. it has gone to their staff and says, please, get the highest price per labor that you can get. and they did it. and we're happy they did it. that's what this project labor agreement has done.

notice, i have a shoe here. and if i turn it this way, you'll find a hole. i think we shot ourselves in the foot. it's clear, if you take $2.1 billion and divide it by the total number of workers, as reported here, that comes out to about a $264,000 per worker we paid. the material -- i don't know quite what this percentage is -- this isn't my business -- but let's say it is 50%. that means we paid on an average, each worker, $130,000, on average, $130,000, and we're proud of that fact. i'm scratching my head. i'm confused. i think we shot ourselves in the foot. it has not guaranteed us more and on-time performance. it has not guaranteed a higher-quality product.

it is guaranteed that you ripped the public off. we shot ourselves in the foot. my goal is that we don't make a similar mistake on the next big project. please do not guarantee the highest wages when we build at d.t.x. thank you. >> chairwoman: that concludes members of the public who want to address.

>> ron will talk to budget and contract closeout process. moveinmoving on what happened we report last month. fremont and first street plate material. now all 16 plates are on site. there's been lot of progress as mark reported regarding to the repair and remediation. all o the on site preparation hs

been completed. this was a design that wasn't approved by the pier review. that's being implemented now. l.p.i. they did submit their final report to the pier review. the pier review is reviewing it. they said they need until may 1st to review it. at that point, we'll go through comments and then be able to finalize that with the pier review's comments. in parallel, the project team has been gathering as mark mentioned, documents are continued to be received as we speak as well. we're still on track schedule wise. quick reminder what the repair looks like. i think i said about five times

yesterday, but that was the analogy what was used to show where the plates are. this is one-half. other side of that girder has the other side. here's some pictures of that plate. you can see what we've been talking about for a long time. these are the plates that when they arrived in stockton, drilling some of the drills for this 370 steel. all the plates, the new plates were drilled in stockton. the existing plate on the two girders out there and first street, are getting drilled in place. they're bringing the plates after the new plates are drilled in and stockton and much more

efficiently to do it. now they're putting up and drilling out the existing girders. you can see in this picture, this is the team fitting up the plates to term plate the existing and ongoing with that process in prepping even to the point where sandblasting is happening. wherever girders were done, they are cleaning it up. this is the nice, proper sir fass between al--surface betwee. what are the next steps? project team will continue to do that facility wise. mark mentioned that by end of of this week that we would receive documents from one of our contractors. they confirmed that this morning. they are expecting that this

week. we anticipate to digest that and at that time we'll be able to ascertain if we need to go with any elements in the field. ultimately we anticipate by end of this month, a full package delivery to the p.r. feed for their review. depending on how the review goes over the next couple of weeks. what's going to happen in may, we'll complete the repairs and remediations by may. we also will have the shore removal. i'll talk to that in a second. the reinstallation all facilities in close proximity of girtedders in both locations, which makely means -- basically means we'll stitch it back. all of that has to go back at street level that will be very soon. here's our schedule slide.

the only real main change besides the first three lines has not changed. moving down to the permanent fix installation, i got two diamonds there. what's that showing tentative where we're projected at this point. at fremont street what we're projecting at that time. then same thing at first street we're anticipating by may 1st, around that time what would happen after that is a removal which is the next slide. we've been working with our partners at mt.a. to get closures to when we can start taking out that shoring in the middle of fremont street. fremont it's looking at this point like we'll start moving

shoring sunday night april 21st. that's we're landing in agreement with contractor schedule and m.t.a.'s requirements and resources. at that point, we'll start reinstallation of all the elements especially fremont street. the nightly closures will continue and they put back fire sprinklers, lights and everything has to go back in will happen at night. daytime commute will not be affected. the project team building continues in parallel. switching to the rest of the work that's still ongoing, the work to complete list is what we call it. i'll have a few pictures for the status. i haven't shown this pictures in a while. now they're becoming pertinent

again. when you look at the west end breezeway, far west end, there's still ceiling panels still require to install. there's quite bit of cell panels that's been majority of the subcontractor that's been out there and still out there performing contract work. shaw ally. that's what you're looking the ceiling light us and the ceiling is done looking down the concrete of the flooring. it's starting to be poured. there was a challenges with the electrical elements with the jaime carpenter artwork that was worked out. had work through a gfci. it's a device that's in all of our kitchens and bathrooms. ours is a lot bigger. they worked through that and those items are on back order. we'll get the concrete poured. as soon as those do show up, the lights and the benches and floor will be able to be activated.

that's coming in due time. we're able to put the concrete in short order now. the traffic signals. at first, fremont and beal, the contractor has done all his work. pg&e has parts on back order and cannot power our signals. that's why if you haven't driven through there and uyou see all e signals dark, pg&e they anticipate they won't show up until mid-may. we want to get activated immediately. it affects local businesses. it affects sales force tower getting out their garage. there's lot of elements why we've been waiting for a long time for pg&e to come through. that's why what's happening at the three signals that are on the project. there's other ceiling panels throughout the building as well

too. now switching gears out of the work to complete. back to facility wide validation framework. this is back total project again. this the funnel slade before i turn it over to ron. it is how we're handling the structure steel part. as we referenced, we're working on thompson middle fab to submit additional documentation which is what the purple stage is. i gave you the timeline. hopefully that's in the p.r.p.'s hands by end of month. as of now, what we have seen, there's no need to go to the green and orange. we'll still ascertain that as we

continue. ly turn it over to ron. >> they still closeout work that's not related to the beams. >> there's still contract work that has nothing to do with the beams. correct. ron will talk to some of the commissioning elements. i just talked to the physical work out in the field. >> your expectation it will be done before we open? >> there's some minor work that will continue. they are projecting by septembe. >> good morning again. thanks dennis for such great focus and momentum towards the remediation out in the field. just a reminder with this slide, these are the steps that are we're taking towards readiness, for reoccupancy. as dennis mentioned, we got

momentum with reaffirming the structural integrity of the building. the repairs ought to be done by end of april and before june, only thing that will stand between us and opening is whether or not we've made our way through all those other concerns regarding brittle fracture. did momentum on that front. review of test and records were completed in march. the documents we spoke of earlier is the deeper dive on the fabrication and piece information, shot drawings from all the different fabricators. it was slow coming at first. a wealth of documents came last week and as dennis mentioned, more of the fabrication and sequencing information is

forthcoming. they will inform up on brittle fracture. hopefully we'll get that resolved in parallel with wrapping up the physical work out there. we'll be revalidating the fire and life safety whenever it's back and stitched back together. it'll been interrupted by the repair opportunity -- activity. in terms of building management system commissioning, we got an early start in january and february. they worked through some issue. now we're back with the commissioning agent at the end of march and stepping into this first part of april to be position to be fully

commissioned and validated with the tail being at the end of may where we're addressing areas that are currently interrupted by the repair activity. we've brought back the budget slide. we're expanding our focus back to budget and closeout to wrap up this effort. in terms of the budget, we have currently expanded $2.134 billion, committed $2.116 billion. of that 2.19 is construction. in addition of legal cost take us to an e.a.c. of 2.203. obviously with the extended to

protract closeout, we're experiencing upper pressure on the e.a.c. which we are looking at as a counter weight as we discussed earlier, there are tools to address those that are responsible for some of this additional cost and will be deploying those tools fort forthright. contingency cost, over the last month has been about $.9 million drawdown. most of it's catching up with site work and also standing up some original as well as some of the late coming low voltage system. nothing really moving are the arrow there. you'll see that the remaining balance program reserve is at

$57.5 million. that does consume or include the projections of tenant improvement and legal cost that's baked in that understanding. closeout process. with this slide, the outline of the closeout is the warranty receipt. much of which is behind us, punchless complete and accepted is well under way. as dennis may mention, there are ceilings and concrete here and there that will take us into the summer. i intend to improve on. outstanding noncompliances are all but corrected with of course, the last one standing being the noncomplains of the

fractured beam. commissioning and training system, i touch on already. finally it's the full and final closeout of change orders. there was a time the joint venture pulled away from the table. they went quiet discussing closeout with the various subcontractors. we've talked and we sense come back to the table to reenergize discussions about closeout and pick up where we left off. the last i showed you progress on closeout. as we speak, there's eight trade packages that will likely close up once we wrap up the girder issue. those trade packages are engaged in the girder issue. seven trade packages are at various stages of closeout and

advancing 13 trade packages are expected or anticipated to be involved in the claims process. as we speak, 16 trade packages are ready for full and final closeout and awaiting those documents for my signature in the coming days or week. with three trade packages already closed, those were the very early site-related trade packages. with that i can take further questions or dennis can address more detail on the repair. >> chair nuru: any questions? no questions?

>> did you want to comment in regards to item 6? >> good morning directors. let go back to the director's report. it was related to the manufacturing process. i like to bring to your attention is the presser that took place in the hallway right after the prior board meeting. rather than giving you my own report, i'll read to you what the chronicle correctly report reported. quality control teams failed to

notice the other site. we're talking about the grinding. so they turned construction, quality insurance contractor to make sure the contractors were following the plan. to me as a member of the public, that's a classic systematic failure of the entire fabrication process for the steel structural package. so now, you have this presentation to do. we will reaffirm the structural integrity of the building. at some point, you need to understand that this is not a normal building. the entire building is actually a bridge. that bridge is submitted to bus

traffic. you have two choices at it point in time. you can say, we did good job, we're ready to go first of june and let's go. i want you to start thinking about going down the road, say six months or a year from now, you get another failure. you have to shut it down and then what? only way you can safely reopen this facility is to install a permanent structural monitoring package. we're way ahead of time before this is form. it just a matter of listening to it. if you don't believe me, you not

m.t.c. here, go ask them. ask them what happened to the bay bridge when it fractured right a month after repair. the old bay bridge. thank you. >> call your next item. item 7 is citizens advisory committee update. gri like to congratulate mr. derek hotel. he's our new tjpa chair. he was vice chair les -- last y. >> good morning directors. thank you for continuing to hear update and comment comments com. we're excited about new members

representing transit riders. our meeting tuesday evening was productive. given the closure of the transit centre since last fall, the c.a.c. is pleased with the retail leasing update by martin. it's 59% occupied about million dollars under budget and on track being 100% leased by end of next fiscal year. in regards to the pier review, comments and questions indicate strong interests in the review of processes and proceduressen implemented in phase one and the recommendations for future phases including the rail extension. we're counting on updates from executive director zabaneh and

future updates as well. the c.a.c. welcomes the temporary closure update. preparations completed and plans still on track for the june 1st completion of the repairings. repairings -- repairs. we're hopeful with improvements for the park area completed soon such as repairs to the walking path. c.a.c. appreciate the detailings and check balances in place and openness the cu updates are

communicated. thank you. >> thank you. >> we'll go ahead and call item 8. it's public comment and opportunities for the members of the public to address on matters not on the calendar. we can move on. we'll call the consent calendar items separately. [agenda item read] >> move for approval. >> roll call vote which we moved them from the consent calendar. [roll call]

minutes are approved. call item 9.2. [agenda item read] we have not received indication from the public like to comment on it item. [roll call] item is approved. item 10. [agenda item read] >> this item presented by aaron.

this is aaron's first board meeting. from good morning. very happy to be here to present to you the budget outlook for fiscal year '19-'20. there's a calendar of what's going to happen. the budget outlook presentation then next month it will be a draft presentation of the budget and then in june, we would like to adopt the budget outlook gives you a general overview what you can expect to see next month. this year's budget, will focus more on operations as the transit centre opening and less focused on capital as phase one is closing out because transit centre is opening ramping up for phase two in the operating budget, there's administrative

salaries and benefit and proportion between operating phase 1 and phase 2 with heavy leaning towards operations. there's the administrative expenses, day-to-day things that go on, insurance, office supplies, those sorts of things. then there's the transit centre operation, which is the big chunk of the operation budget. there's professional services, mainly l.p.c. contract security, i.t., cybersecurity all included in the transit centre big chunk of the operating budget. this year in 19-20 we'll have debt service and operating. the debt service wasn't included in the preview that you had in

your previous board meeting. it will be included in the main budget. the debt service has its own dedicated revenue source it won't have an affect on the operating budget itself. into the capital budget, for phase 1, we're going to close out. the funding sources that has been identified for the capital budget will be using up the remaining amounts of those and then into phase 2, we'll have r.m.2 and r.m.3 money to phase phase 2. do you have any question about the outlook? i do want to add one more, that we will minimize effect of the operators as much as we can. [laughter]

i had to save it for last. >> chair nuru: thank you. >> call next item. item 11. [agenda item read] >> this is an agreement between the tjpa to provide the traffic signal work, traffic markings and other traffic related items. we're asking to extend the agreement one year to allow us to complete this work. >> i'll move approval. >> second. >> nom members of the public wanting to comment. [roll call]

the item is approved. call your next item. item 12 [agenda item read]. >> is this a joint presentation? >> this will be a joint presentation. i will let casey do the first few slides and then i'll present on the business. >> hello director. i'm director of government and community affairs at caltrain. just reminder, i know everyone is aware, it's good for members of the public, the remainder of where caltrain specifi serves. caltrain serves down to gilroy, it's a 77-mile route. when we talk about the project and improvements that go along

with that project, it's within that corridor. the park south of san jose is owned by union pacific. which is a freight railroad line. electrification details 51 miles from san francisco to san jose. traction power facilities which help regulate the power throughout the corridor. we're buying brand new electric trains. these are called electrical multiple units. we're we will have 19 new car train set. we got state funding for the project. we're excited to be replacing old diesel train and get these brand new high performance electric trains. the services will be up to 79 miles an hour. we'll have more stations and reduced travel time because they have performance attributes that are much better than diesel

trains. we're restoring weekday services. we'll have a mixed fleet for interim period. we'll have some diesel trains out on the corridor. we have plans to even expand that beyond what we're contemplating today. we'll have tenant service today, ace, capital corridor and freight operating on the corridor. they'll be able to run underneath the wire. we are in construction today. on the left, that's some of the infrastructure putting in the poles and the foundation, the far left hand corner is picture the tunnel in san francisco. on the right-hand side, those from pictures of the brand new electric trains getting built now in salt lake city. recap where we are with the schedule, this is a project that's been in years in the making. we started construction in 2017.