revenue loss that we have to cover. also to help inform the planning for expanded public transit subsidies and moving towards fare free transit in our city. joining the other cities around the country taking this important step too right now. i did have questions around the cost of this. just the pilot program sounds like more than $9.3 million originally projected by s.f.m.t.a. and how that cost would potentially impact our urgent priorities restoring transit service in our city and other budget priorities that we are all grappling with right now through the budget process. i appreciate the discussion with

you, supervisor preston. this is proposed to come out of contingency reserve. it with not have a direct impact on some of these other urgent priorities. service restoration from muni. on the west side we not only need to restore the lines still not restored. we need to expand transit on the west side which is under investorred medical now. -- until now. i support this and look forward to moving this bold and important pilot program forward this summer. >> thank you, supervisor mar. vice chair safai. >> thank you, chair haney. thank you everyone for the

conversation. anyone here from nta? i have a few questions for them directly. >> this is s.f.m.t.a. director tumlin and the budget team is on the line as well. >> the things i have heard although this might be a very laudable goal. the thing i am most concerned about is service restoration, full-service restoration. i am concerned about what we have heard in the ta meetings and conversations with you about driver shortages, my district has one of the most utilized lines. mission route 14r. when i am there in the morning it is overcrowded and people waiting in long lines. i don't quite understand how this proposal helps to address

any of those issues. i don't see how we help with long lines. i don't see how we help with driver shortages, how it helps with overcrowding. in fact, what i'm concerned about we had a hearing on the recovery of downtown which again a lot of my constituents work downtown in the service sector. if they don't have appropriate service, if they don't have appropriate number of buses, they will have a harder time getting to work. then i think about those that do have the income to pay how they are benefiting from this across the board. it seems to me from my analysis if there were a direct funding source and this were going to

augment muni's budget in a way, it might make sense. the other thing just for the chair and other members on the committee, yes, we are calling this covid recovery. it was labeled covid recovery. that is the biggest reserve fund. we designated that as part of the recovery system. it will be recategorized as reserve account. we benefited greatly from the biden administration, a number of bailouts. that money is one-time funding. at some point that money is going to run out. the thing that has allowed us to survive this economic downturn has been in many ways our reserve accounts coupled with bailout from the federal government. i am concerned dipping into that as we continue to help people

with rent and put food on the table and training people, child care, all of the different things we are trying to do that are basic city services. this does not seem to fit into that. i agree with some of the goals. absolutely. i don't see how taking from a reserve account we need to keep things going in the long run and then all of those other issues from m.t.a. i would like to hear from director tumlin on overcrowding, driver shortages, service shortages and in terms of overall recovery for your system. does this meet those goals and objectives? not to mention folks that have income to pay won't be asked to pay. supervisor preston i was on front lines with you with the operators in the beginning of the pandemic last year.

we worked with m.t.a. and director tomming lynn and we got them to no longer require cash and fare collection. we have done free muni at the beginning. there was no fare collection for a long time. yes, ridership was down. we did some of that in partnership with the operators. i know muni relies heavily on the fare collection. i would like to hear through director tumlin how this plays into that. not to mention the fact and this is the table point. we could put this into final decision that rests with the board of directors. if they don't feel like this meets their goals and objectives. they can choose not to approve.

having bet they are not interested in accepting this money and operating this program. it is not approved on the m.t.a. board side. i would like to hear how all of that fits in based on everything we just talked about. >> that was a long question. i will summarize. from a staff recommendation and m.t.a. board policy standpoint. our priorities right now are focused on addressing the severe crowding that we are experiencing on the system every day. we are leaving hundreds of riders behind at the curb, particularly in the densser and lower income neighborhood like the mission and chinatown. that is an immediate problem we need to address.

we are deeply concerned about service recovery. we are so grateful to the federal government that allowed us to avoid 20% layoffs and for the money that buys us time. as you have stated we run off a fiscal cliff in 2023. our goal is to get to 110% of pre-covid service in 2023. that requires substantial new additional sources of ongoing operating revenue. the federal relief money we have is not enough to get to full-service restoration. the primary concern is delivering the service. related to that primary objectives are removing obstacles to transit. that includes having the service in the west side in places where

they lack muni lines. also, removing fare barriers for those who face significant errors. >> they are eligible 30%. we are interested in looking in detail to figure out who would benefit? how do we take limited resources and invest to remove barriers for people that face the greatest barriers. extending free muni to all youth. that is $2 million a year. that was the estimate last year as well as looking at expanding the discount the income eligibility requirements. those are the priorities at the

moment. >> can you also speak to the point about i know you have free muni for income eligible. you have muni for youth. this program also. what percentage of your riders are clipper card holders. i know you can't measure people's income. it is usually a stronger association. there are people that have enough income to pay. this would also benefit them as well. obviously if you are doing a free program it seems like it would be serving a good percentage of people not the intended target from what the conversation is about. >> we have good data about our ridership demographics by

income, including what fare programs they use. we have some concerns about the universal free muni program not looking good in the title 6 analysis. the bulk of the free muni investment would go towards our most athletic riders. lowest income riders are controlling the greatest fare discounts right now. >> i can come back. is the controller's office here? >> yes. >> who is here from controller's office? >> reesa sandler. >> in terms of our reserve

funding this is coming out of one account with $500 million. over the course of the last year how much reserve funding have we used to keep the city going? how much all every serves have we used? we are to public the nine month report. i don't have that right in front of me right now. we are planning to publish tomorrow. >> if i recall the number it was significantly over $1 billion in reserve funding that kept the city going over the last year and a half for all of the city services, if i am not mys taken. my point is that as we have drawn down on the reserves they helped the overall city keep going. i fell like we need to think some of the agencies going off a

fiscal cliff. we will need time to recover to increase revenues. the report coming out is looking morose see, there -- rosie there are some areas that would be in dire straights without federal funding. that is it for now, mr. chair. thank you. >> thank you, supervisor safai. i have a few things to say. my colleagues can go first. president walton. >> thank you so much, chair haney. thank you for being here director tumlin. for now for clarifying i want to understand you correctly. you are saying our low income riders wouldn't benefit from free? i am trying to understand that rationale. >> no, our low income riders

would certainly benefit from free muni. because muni's ridership includes broad demographics. as the ridership returns, the bulk of the financial benefit of free muni would go towards more affluent riders. if we want to direct available funding to benefit lowest income riders, we would instead expand the eligibility rules and expand the discount available for lifeline pass. so that all of that money could be directed at the people who need it the most. >> i am trying to figure out the overcrowding issue. that is something your leadership and your team needs to address and fix. i am trying to figure out why

that wassent discussed. >> the demand is well documented in systems across the world and the factor in the travel demand model. so if we eliminate fares, the effect is on ridership. while the global and national data say that even if you get increased transit ridership as a result of limiting fares, you do not get a reduction in automobile traffic. the effect is increase in ridership to take away from walking trips as well as increases travel rather than getting people to shift from driving trips to transit trips. the crowding means that we are concerned about a sudden increase in ridership before we are able to hire additional

operators and get them trained to offer a significant expansion in service. we are racing as quickly as we can to hire new operators. it is going to be several months before we are able to turn that into additional service and additional capacity to alleviate the crowding out there right now. another concern we have is that eliminating fares on the 14 and particularly the 14 rapid omission street means a lot of riders will avoid taking a somewhat faster bart trip and instead take a somewhat slower but free muni trip, which will not only significantly exacerbate crowding omission street but through revenues as well. >> what is the percentage of the bus and train routes that are overcrowded? >> it is a pretty significanters age. we have a dash -- percentage.

we have a dashboard with that. i don't know if we have it offhand. >> you can get it to me. i am curious with the percentage of the bus and train routes overcrowded. going back to you as leader of m.t.a., whether or not it is free or not it seems like there is an overcrowding issue. how is that addressed? i am not going to say what i can see as ways to address it. i am going to say that one thing doesn't have anything to do with the other. that is something you need to address in your own. we understand that. the one thing you keep saying i am glad you keep saying it. the one thing we know about free muni from what i keep hearing from you the effect is higher ridership. >> absolutely. that is why we are interested in

free muni. i built one of the largest free fare public transit operations in the country. there are many good reasons to support free transit. the concern is making sure we put the stability of the service, financial sustainability and quality of service first. that we don't sacrifice service to take away fares which are 20% of muni revenue. >> going back to sustainability. this is a pilot here not affecting muni's revenue at all. i just want everyone to be clear about that. >> supervisor preston. >> thank you, chair haney and thank you to the chair director tumlin for your comments and your work on this. i will say that some of the

things i think you were just talking about are pretty speculative. i think one of the points of the pilot is to see the items when you talk about what modes of transit people will abandon to get on public transit in a pilot. people for going uber or walking, riding. i understand these are difficult to measure, but i do think that we don't frankly know in san francisco because we haven't piloted free muni, what kind of impacts we will see. are people moving off their bicycle to muni because of the free muni pilot? there may we -- may be ways to look at that. i want to address some specific comments. first off, you mentioned title 6. i want to clarify that our

understanding from your team is that title 6 analysis does not apply or in any way limit the pilot project. do we have that correct? >> that is correct. >> then you referenced the bulk of the benefits flowing to more affluent riders, something that is i want to drill down on for a second. what do you define as more affluent riders? >> again, i don't have our income category data in front of me, but we can get that to you. it is the income categories that are required in any title 6 analysis. >> when you are saying that -- you are making the point and frankly the point made against

every universal program as opposed to tested program. by doing it in that way if you compare choice a to provide something directly to the lowest income people and choice b to universally. it is disproportionately in b those more affluent. i have a feeling you are using the phrase more affluent to refer to everyone not so low income they qualify for discounted service. i don't want to put words in your mouth. you say the bulk to more affluent riders. the bulk of free muni to rich people in a certain a.m.i. category very high end? i ride the bus and have every day for 28 years. i ain't seen a lot of wealthy

folks on the bus lines i am on as far as i can tell. i see them in ubers all of the time. when you say more affluent riders, are you talking about folks more affluent than extremely low income folks qualifying for the existing programs? >> income varies across the broad spectrum. we can cut the income however you like. we are happy to do that analysis. we have not done a title 6 analysis on free muni. we do have all of the pre-covid ridership by income category and we are happy to share with you and you can make a judgment call what qualifies for what level of income. >> i want to reiterate that is part of the reason title 6

analysis did not apply in three month pilot to get at the very questions who benefits, who rides and who doesn't. if we get out of the short term pilot. the other thing i wanted to raise is and it seems like we are all in agreement a free muni pilot will generate more ridership. you know, i don't think there is any disagreement increase demand for muni. i am trying to understand m.t.a. position with respect to that. is it not m.t.a.'s goal to restore ridership and to increase ridership on public transit, especially at a time when there are real questions about people getting back into the congregate setting of the

bus. is that a goal? we all agree this policy would further the goal of m.t.a. to increase ridership. >> yes, we are about ridership. we love serving san franciscans. what we are concerned about as we invite people back to the system and they are faced with crowded buses and being left behind at the curb that can unintentionally create worse feelings about transit. we are deeply concerned. we want to make sure the service is there and people can access that service before we start taking on programs like making the service free. we are deeply concerned about the existing crowding problem we are suffering. we are focused on improving the

service to make sure to attract riders. data is clear that what really drives ridership is quality of service. that is across all incomes. >> it is your position that there are not sufficient operators right now to address the increased service needs to address overcrowding currently with regards to the free muni pilot? >> that's right. we are scrambling to train everyone on the current list and re-open the operator list so we can restore service. as you recall, we have been on a hiring freeze for a full year because we were braised for 20% layoffs.

before covid, our operator -- we were experiencing operator shortage. we couldn't deliver the promised pre-covid level of service in part because of the growing structural deficit. over the long run, all of our key sources of revenue that we generate ourselves have been in long-term decline. that has meant our deficit has grown. covid exacerbated the problem to deliver is service we need. >> can i add to that answer? i think the question that we are getting that supervisor safai brought up is short term versus long-term. to bring the ridership back we want stable, consistent and reliable service. it is our plan to deliver that to the public over the next six months.

the agency must continue to see revenue rise and sustainable revenue not one-time funds. what will yothe ridership is consistency of service the bus shows up on time and clean and people get to where they need to get to on time. from policy standpoint, the belief is that the reliability and quality of service will drive peak back to the system. on the affordability question, the question of who might benefit and supervisor preston we have been working on analysis around the questions. the question is as you example $81 per rider to get them back. that is the full regular backpack. people experiencing homelessness which there is a policy they ride for flee. low and moderate income youth in the city ride for free. that benefit that $81 is going to people who do not qualify for

those programs or somebody who is on a lifeline pass as director tumlin noted are getting $41 of the benefit. two things. one is income and the other element be are we seeing the consistent fare revenues recover and come back in we post the pilot. we can look at the three month period. we are talking about after that. does the agency have the revenues necessary to sustain that service, make those vehicles available, the ability to pay the participateters the salary they -- operators the salary they deserve to live in the city? >> there are a number of threats. let me start with this idea around you keep talking about folks eligible for free or reduced service.

33% you imply only those not eligible are going to benefit from this. can you tell us not how many are eligible for free or reduced fare but what percent of the people eligible for free or reduced fare get it in san francisco? it is inaccurate to suggest everyone low income, homeless and so forth in these categories is accessing free muni. it is any mean tested program there are the most vulnerable who do not go through the process. there is a big push for free muni. you have stated a third of san franciscans are eligible for free or reduced. what percent of those eligible from have availed themselves of

free or reduced muni? >> diana is on. while i start to answer that question, she can take a look. you are correct, supervisor preston, there are people who may access the program who are eligible and who participate. as director tumlin noted there are administrative and other barriers for people to take advantage of our free and discounted programs. this is why as an example the m.t.a. board as part of the last budget we coup not implement proposed making muni free-for-all youth. when we looked at the cost benefit of enforcement and everything that went with it, it made sense to make muni free-for-all youth. we propose to do that permanently as part of that program. i acknowledge barriers and not everybody participates. with that said when it is reduced or free, some are choosing not to use the system

again for those reasons. cleanliness, reliability, can i get where i mead? is it quality of service keeping people from taking advantage of that reduced or free program? is it the income barrier itself? as director tumlin noted we are open and we proposed as part of the last budget to remove a lot of income barriers. again, is it the quality of the service, amount of service that is the reason people aren't participating in the programs now? as soon as i get the technical answer to the question we will share the information. >> we know the factors that influence muni travel demands. while there are many things that may being san francisco special and unique. the way to get from a to b is the same as anyplace else in the country. the data that is this is clear

and is routed in actual local travel patterns that can tell us the factors for service improvement versus fare reduction versus time reduction. we can do any query to get an estimate of what different service changes, how this would impact travel behavior. >> i think it is problematic to put out stats saying 33% of folk are eligible for free or reduced. essentially away then following up the benefits of the program proportionately going to go to those of higher income. it is implying that the low income folks are getting discounts on muni.

i don't think the 33% eligibility is really even relevant if you don't have the stat of how many are using it. we know a significant percent aim of people who qualify are not using it and would benefit from free muni. >> we agree with you on those points. >> look, are there real challenges in terms of overcrowding and service restoration? absolutely. we have to rise to the challenge. we are not doing that with or without muni. i hear the point and we have talked about it privately and here. i hear the point that there is a concern over what happens after this current two year budget period in terms of long-term physical health and structural deficit. that is what is driving the lack of service with or without

agencies making decisions around what may or may not happen two years out. in terms whether to restore lines right now and whether to address the overcrowding. all of those things exist with or without the free muni pilot. i think that that is the challenge for m.t.a. to address with or without free muni pilot. you know, i also just wanted to say in terms of like half of the -- according to pre-pandemic data. half of the adult single riders on muni are low income, a full half are low income. it is about a third when you go to the clipper card of folks.

this idea and i think we disagreed in the past. numbers are numbers. overwhelmingly the low and middle income people are going to benefit from the pilot. >> good afternoon, supervisor preston. revenue manager for s.f.m.t.a. the statistics for enrollment for lifeline program. we find about 51% of the eligible population have been enrolled in that program over the last eight years. for our youth that must be is about 75%. 95% for seniors. there is a gap we are working to fill. we also just as reminder. there is a regional low income transit discount on clipper, the start program to provide half

price single ride discounts. that started last year. we think the single ride discounts will help compliment the programs we have right now. >> thank you. to echo supervisor walton's earlier point. most of the folks you referenced are seeking relief. they are paying a discounted fare reduced to zero and the numbers you indicated. 51% indicate that is half the folks eligible for that program don't access it currently? thank you. >> i have a few questions and comments. the first i have to say i found it a little surprising and a bit incredible to hear of the

leadership of our transportation system essentially arguing against increasing ridership. it sounds like that your concern about the program is that it might increase ridership. particularly where we are as a city and what we are seeing with economic recovery. i want to dig into that and understand that a little bit more. is it the goal of the m.t.a. to increase ridership generally or is it only riders who are choosing to get in a bus and train and giving up certain types of other transportation or is it only riders who can pay? it seems like you are qualifying the type of riders that we wanted as opposed to having a general goal increasing ridership. in this moment we are not ready

to increase ridership? >> thank you for the question. i don't want to give anyone any impression that we are opposed to high ridership. we want higher ridership as part of muni. it is a fifth moment in time. we never suffered of having to leave essential workers behind at the curb like we had at the end of covid. the period of time as our ridership is rising but we are lagging on our ability to restore service as we trier to hire operators. buses are extremely crowded and we are trying to meet 3-foot social distance goal resulting in us turning away more riders than ever in our history. is a big problem now. we are concerned with sequence. we want to restore all services

and we want ridership higher than ever. the service restoration and ridership increase need to be in sync with each other along with reducing social distancing. does that clarify? >> it is more of a question right now you don't feel you have the capacity to take on more riders than we have right now? >> in our key corridors. if you google s.f.m.t.a. covid dashboard, you can go to the passenger count data and see a detailed map of red circles on the core lines. this including geary, market, haight, silver avenue, el sessyour, mission where we have

to leave a lot of readers behind because the buses are completely full. >> you are attributing that and i want to be clear. you are attributing more to labor shortages than anything else? we had a hearing on your budget last week and at least in the short term in these immediate two years we received more fund the federal government than we lost in revenues. it doesn't seem to me that it is a loss of revenue issue in the short term. why are we not prepared to be in the situation with economic recovery to not leave so many people at the curb. it is not caused by free municipal new. free -- muni. it is not connected to our covid

revenue losses. >> the fact that we are pointing and making that part of the free muni conversation. it is an independent and urgent problem that we are failing to solve right now. why are we in this situation and what are you doing to address it? >> good yes. there are several interrelated problems. couple of primary problems are directly related to covid. social distancing on muni initially cut capacity by 70%. we are now at loss of 50% of capacity because we are not allowing. the health department won't allow more people on the buses. in addition we have some of the strongest bus cleaning andsterrization procedures in the country. all buses have to go back to the

yard at the end of each run to tobe sterilized. that may beings us very inefficient. we try to make up for it in speed and reliability improvements through headway management and through transit only lane program. the other key factor is staffing. three months ago we were braised for 20% layoffs. we knew over a year ago that covid was going to be a financial catastrophe for us. this is by far the worst financial crisis the agency has faced in 110 years. we had a hiring freeze early on. that meant as our operators retired we were not replacing them. the work force shrunk thanks to the effort of stacy abrams in

georgia our for for opportunities reversed in the senate when we received federal money. now we have to get back in first gear. we are hiring as quickly as we can and training. becoming an operator takes tremendous amount of training. there is a time periodness after the hiring process to get those folks ready to be out on the street. we are moving just as quickly as we can in order to get operators into our buses, to open up the train system where those vehicles have greater after. that is taking time to completely reverse what for a year we were planning as the system to reverse that and be in

extension. >> got it. i do think that this pilot will start in a few more months. hopefully we will be further along with that. it is unfortunate we are in