21-2007

GOLDEN GATE BRIDGE, HIGHWAY AND TRANSPORTATION DISTRICT

MEMORANDUM OF MINUTES

BOARD OF DIRECTORS WORKSHOP

NOVEMBER 9, 2007

 

The Board of Directors of the Golden Gate Bridge, Highway and Transportation District (District) met in regular session for a Board of Directors Workshop in the The Presidio Golden Gate Club, Hawthorn Room, First Floor, 135 Fisher Loop, San Francisco, California, on Friday, November 9, 2007, at 10:00 a.m., President Moylan presiding.

ROLL CALL

Directors Present (16): Directors Brown, Cochran, Eddie, Grosboll, Hernández, McGlashan, McGoldrick, Middlebrook, Newhouse Segal, Pahre, Reilly, Sanders, Sandoval and Stroeh; First Vice President Boro; President Moylan

Directors Absent (3): Directors Dufty and Kerns; Second Vice President Ammiano

Staff Present: General Manager Celia G. Kupersmith; District Engineer Denis J. Mulligan; Auditor-Controller Joseph M. Wire; Secretary of the District Janet S. Tarantino; Attorneys David J. Miller and Madeline Chun; Deputy General Manager/Bridge Division Kary H. Witt; Deputy General Manager/Bus Division Susan C. Chiaroni; Deputy General Manager/Ferry Division James P. Swindler; Deputy General Manager/Administration and Development Teri W. Mantony; Public Affairs Director Mary C. Currie; Marketing and Communications Director Kellee Hopper; Director of Planning Alan R. Zahradnik; Assistant Clerk of the Board Karen B. Engbretson

Visitors Present: José Luis Moscovich, Tilly Chang and Leroy Saage of the San Francisco County Transportation Authority (SFCTA); Jerry Grace, Oakland resident

PUBLIC COMMENT

Jerry Grace inquired regarding whether the Board was taking action at this meeting regarding a Doyle Drive toll. In response, Ms. Kupersmith stated that further discussions will be held at future meetings of the Board of Directors before any action is taken.

SPECIAL ORDER OF BUSINESS

       
1.
Development of Updated Strategic Plan for Achieving Long-Term Financial Stability (Strategic Plan)
       
  a. Staff Presentation
       
 

In a memorandum to the Board of Directors, Auditor-Controller Joseph Wire and General Manager Celia Kupersmith provided a report regarding the District’s financial situation, including a review of deficit reduction actions currently underway, as well as options for eliminating the remaining deficit. The report provided a brief history of the Strategic Plan for Achieving Long-Term Financial Stability (Strategic Plan), which was first adopted in June 2002, when the District’s five-year deficit was estimated at $454 million. The report also listed the programs the District undertook to address the deficit, including staff reductions, wage freezes, employee benefit reductions, bus and ferry service reductions, fare increases and a toll increase in September 2002. In addition, several other important revenue enhancement programs were implemented, such as changes to parking fees at the Bridge, changes in our property management strategies and sales of an annual commemorative Golden Gate Bridge holiday ornament. The District also changed its approach to providing local bus service within Marin County and negotiated a service contract with the Marin County Transit District that more accurately reflected the cost of providing this service. These deficit reduction strategies were described in further detail in Attachment C to the staff report. The report noted that as a result of these Strategic Plan initiatives, the District’s financial stability has substantially improved and the five-year deficit is $81 million for the Fiscal Years 2008/2009 – 2012/2013 from $454 million for Fiscal Years 2002/2003 – 2006/2007. The report also noted that that after the current five-year deficit projection was developed in August 2007, a new actuarial evaluation was released that added an additional $10 million over the next five years to the deficit to fully fund the yearly post-employment benefit (OPEB) requirement, increasing the total deficit from $81 million to $91 million for Fiscal Years 2008/2009 – 2012/2013.

The report summarized the strategic planning process, as well as the work of the Strategic Plan for Long-Term Financial Stability Advisory Committee (Strategic Plan Advisory Committee), which was formed in the fall of 2005 to develop an updated Strategic Plan. The Strategic Plan Advisory Committee last met in September 2006 and presented their recommendations to the full Board at the Annual Workshop on Long-Term Strategic Planning held on September 8, 2006. Materials from the September 2006 Workshop were included at Attachment D to the staff report. The report stated that the Board gave staff direction at the September 2006 Workshop to pursue revenue generation and expense reduction strategies, including a Corporate Partnership Program and the initiation of a toll increase process. Subsequently, the Board directed staff to postpone any toll increase until after a decision on the Corporate Partnership Program was made. After working on development of a Corporate Partnership Program throughout 2007, the Board of Directors decided to suspend the Program at its meeting of October 26, 2007. The report also stated that there is an initiative from the San Francisco County Transportation Authority (SFCTA) to implement tolling on Doyle Drive, potentially using the Golden Gate Bridge Toll Plaza to collect such tolls. This initiative could have potential impacts on the District’s efforts to reduce its deficit with the implementation of any future toll increase.

The report also provided an update on the deficit reduction strategies presented and discussed at the September 2006 workshop, as follows:

  A.
Corporate Sponsorship Program (Strategy Complete). The Board of Directors suspended this program.
  B.
Property Leases (Strategy Complete). Under Board direction, staff aggressively sought to lease unused properties, which successful efforts will result in an additional $1 million in revenue over five years.
  C.
District Deficit Reduction (Currently Underway). The District has been very successful in internal deficit reduction. The proposed deficit reduction program, is on target to generate an additional $3 to $4 million over the next five years.
  D.
Transit Revenue from Increased Ridership (Currently Underway). Staff estimates that by growing ridership on existing transit service, an additional $1 million in increased revenue will be generated over the next five years. Staff will be undertaking a Passenger Survey in spring 2008 to gauge regional transit needs.
  E.
Additional Revenues from Public Sources (New Initiative). Over the past few years, the District has seen significant revenue increases from various public sources such as Proposition 42 funds and Infrastructure Bond funds. This is expected to continue and should be acknowledged in the Strategic Plan.
  F.
Other Revenues (Timing Under Board Review). The largest deficit reduction target, in the amount of $78 to $83 million, would be addressed by a toll increase. The four toll increase options that had been first discussed in September 2006 were listed, with updated revenue estimates based on current traffic projections. These toll increase options were discussed in more detail with graphical representation of each option in Attachment A to the staff report.
       
 

The report outlined the general structure and timing of four possible toll increase options, as outlined below, with the understanding that in order to implement any toll increase a complex public outreach and Board approval process is necessary, lasting a minimum of six months:

  • Option No. 1: A 50-cent increase in FasTrak® (FasTrak) tolls in July 2008 and July 2009, plus a $1.00 increase in the cash toll in July 2009. This option would raise an estimated $79 million over five years, and if implementation were delayed six months, it would raise $70 million.
  • Option No. 2: A 75-cent increase in FasTrak tolls starting in July 2008, a 25-cent increase in FasTrak tolls in July 2009, plus a $1.00 increase in the cash toll in July 2009. This option would raise an estimated $81 million over five years, and if implementation were delayed six months, it would raise $74 million.
  • Option No. 3: A $1.00 increase in FasTrak tolls starting in January 2009, plus a $1.00 increase in the cash toll in January 2009. This option would raise an estimated $83 million over five years, and if implementation were delayed six months, it would raise $74 million.
  • Option No. 4: A 50-cent increase in FasTrak tolls starting January 2009, a 50-cent increase in FasTrak tolls in January 2010, plus a $1.00 increase in cash in January 2009. This option would raise an estimated $78 million over five years, and if implementation were delayed six months, it would raise $69 million.

The report included the following attachments:

  A.
Criteria Guiding Development of Approved Toll Increase Options and Detailed Discussion of Each Option With Timelines;
  B.
Potential Strategic Plan Components;
  C.
Summary of Activities Undertaken to Reduce Five-Year Projected Deficit From 2002 to 2006;
  D.
Discussion on Strategic Plan for Achieving Long-Term Financial Stability, September 8, 2006; and,
  E.
Doyle Drive Materials from Director McGoldrick.
       
 

The report noted that the goal of this Workshop is to develop a list of actions to be included in a final Strategic Plan, which will be presented to the Board for approval at a future Board meeting. In addition, depending on the direction given at the Workshop, staff will prepare all necessary reports for Board approval to proceed with a toll increase process, which process would take a minimum of six months to complete. A copy of the report, including attachments, is available in the Office of the District Secretary and on the District’s web site.

At the meeting, Celia Kupersmith provided background information regarding the Strategic Plan and presented the staff report for discussion by the Board. She stated that now that the District has reached closure with the Corporate Partnership Program, staff is seeking direction from the Board as to the timing and amount of a toll increase, which is necessary to address the remaining deficit. She presented a handout that included a fifth toll option, in addition to the four toll options presented in the staff report. She stated that in light of the plans by the SFCTA to institute a toll on Doyle Drive within the next few months, staff thought it would be prudent to prepare a new toll option that included expedited timing for the implementation of the toll increase. She noted that the SFCTA and the Metropolitan Transportation Commission (MTC) are pursuing legislation that would give the SFCTA the legal authority to collect tolls on Doyle Drive. She further stated that the Board should anticipate having formal discussions soon as to what role the District would play: either by collecting the toll for Doyle Drive at the Golden Gate Bridge Toll Plaza; or, by providing temporary tolling authority for Doyle Drive while the legislative process is underway. She further noted that the public’s acceptance of a Golden Gate Bridge toll increase would likely be impacted by the implementation of an additional toll on Doyle Drive.

Joseph Wire summarized the staff report, updating the status of the various deficit reduction strategies that were put into place following the September 2006 Board Retreat. With respect to the largest of these deficit reduction strategies, “Other Revenues,” Mr. Wire noted that the District’s charter established that its primary revenue source would be tolls. Therefore, the bulk of the District’s $91 million deficit would have to be eliminated through a toll increase. Mr. Wire highlighted one of the handouts provided to the Board, entitled, “Comparison of Increases in Inflation, Fares and Tolls.” He described the difference between the Consumer Price Index (CPI) and the West Coast Employers’ Cost Index (ECI), noting that the CPI measures increases in consumer goods, while the ECI measures increases in salaries and benefits, which is a more meaningful cost index for the District.

       
  b. Discussion by the Board
       
 
  • Director Reilly inquired as to the amount of Proposition 42 “spillover” funds that were available to the District in 2005 and 2006. In response, Mr. Wire stated that there were no “spillover” funds available in those years, because the State of California had held over those funds and provided an accumulation of those funds 2007. He noted that the amount available in 2008 would likely be closer to the usual annual amount of such funds that would normally be available.
  • Director McGlashan stated that county governments were recently warned by the Governor’s office to brace for a 10 percent reduction in the amount of Proposition 42 “spillover” funds available to counties due to impacts on the State Budget from the sub-prime mortgage crisis. In response, Mr. Wire stated that due to the unpredictability of Proposition 42 funds, many transit agencies have found it difficult to plan for those funds in their budgets.
  • Director Middlebrook inquired as to whether there would be any impacts on the amount of the deficit due to the decision by the Transportation Committee at its November 8, 2007, meeting, to recommend approving amendments to the Agreement with the Marin County Transit District for intra-county public bus transit service in Marin County. In response, Mr. Wire answered in the affirmative, noting that if the Board of Directors approves the Transportation Committee’s recommendation, it would increase the deficit by approximately $5 million.
  • Ms. Kupersmith reported that on November 8, 2007, the U.S. Senate overrode the President’s veto on the Water Resources Development Act (WRDA), which will allow U.S. Army Corps of Engineers (Corps) to initiate a cost/benefit analysis of whether it would be cost-effective to take on permanent responsibility for the dredging of the Larkspur Ferry Channel. She noted that the approximately $2.5 million in expense savings that the District will realize in the next five years if the Corps assumes the costs associated with dredging the Larkspur Ferry Channel would partially offset the $5 million increase in the deficit that will result from the amended Local Service Agreement with the Marin County Transit District.
  • Director Stroeh inquired as to whether the costs of projects in the District’s Ten-Year Capital Plan are included in the deficit. In response, Mr. Wire stated that the Capital and Grants Department staff meets regularly with the Engineering Department staff to ensure that the Capital Plan is as accurate as possible. He further noted that the assumption of 80 percent federal grant/20 percent local match funding works well for transit capital projects, but not necessarily for Bridge capital projects. He stated that in the past, the Seismic Retrofit project has been the only Bridge capital project for which the District has successfully received the 80 percent/20 percent grant funding. He stated that staff hopes to be able to transfer that success to other big Bridge capital projects in the future.
  • Director Grosboll inquired as to whether the amount of the Capital Budget stays the same for each of the five years of the financial projection. In response, Mr. Wire stated that the Capital Budget can vary significantly from year to year, depending on the amount of large capital projects in any given year.
  • Directors Brown and McGlashan inquired as to the amount of Reserves. In response, Mr. Wire stated that the District currently has $110 million in Reserves available for operating and capital expenditures. He explained that the amount of the Reserves is tied to the amount of revenues produced by the Operating Budget. He noted that according to direction by the Board, staff endeavors to balance the Budget each year through reduced spending and expense savings so that there is no need to tap into the Operating Reserves. He further noted that for the past two years, staff has been able to reduce expenses not only to balance the Budget, but to also create a surplus that allows additional monies to be transferred to the Reserves.
  • Director Brown inquired as to whether the $91 million deficit included the District’s 20 percent local match for grant-funded projects in its Capital Plan. In response, Mr. Wire answered in the affirmative, noting that the total amount of the District’s Ten-Year Capital Plan is over $1 billion. Mr. Wire explained that because of the multi-billion-dollar replacement value of the District’s capital assets, which include the Golden Gate Bridge and all of the District buildings and facilities, there is a tremendous long-term capital liability associated with these capital assets.
  • Director Sandoval made the following comments and inquiries:
    • He made several general inquiries regarding the structure of the District’s Operating and Capital Budget and its Reserves. In response, Mr. Wire briefly explained the structure of the District’s budget, noting that the District raises all of its revenue through the Operating Budget.
    • He inquired as to whether there is a fundamental cause contributing to the District’s long-term deficit, such as rising costs for healthcare or labor. In response, Mr. Wire stated that the District’s operating costs generally tend to increase at an average rate of just over 4 percent per year, which is slightly higher than the West Coast ECI of 3 percent per year. He also stated that there are a variety of factors that cause operating costs to increase, such as fuel and insurance, and that healthcare was more of a contributing factor about four years ago.
    • He suggested that staff explore the possibility of changing the District’s enabling legislation to expand the revenue sources for the District, to include gas tax revenues or the issuance of bonds.
  • Director McGoldrick inquired regarding the $12.8 million in funding that the District is expected to receive from the U.S. Department of Transportation’s Urban Partnership Program. In response, Mr. Mulligan stated that the Urban Partnership Program funding is earmarked for a Ferry Improvement Capital Project that is not included in the District’s Ten-Year Capital Plan, and that both the project and monies have not been included in the deficit projections. Ms. Kupersmith added that the Larkspur Ferry Terminal parking improvement project has been a long-planned initiative of the District for which capital funding had not been identified.
  • Director Reilly stated that in her opinion, the fundamental financial structure of the District is not sustainable, and that there are only so many toll increases that the District can undertake in the future. She encouraged the Board to seek changes in the District’s enabling legislation in order to allow the District to raise revenue from sources such as bonds and taxes.
  • Director Grosboll made the following inquiries:
    • He inquired as to whether there will be any upcoming major capital projects in addition to the Seismic Retrofit, the Main Cable Recoating and the South Tower Painting projects. In response, Mr. Mulligan stated that it is likely that there will a need for ongoing capital improvement projects, given the fact that the Golden Gate Bridge is 70 years old and that the bus and ferry facilities are over 30 years old. Mr. Wire added that staff is planning for more major capital Bridge projects in the next 25 years, as some of the recently completed projects reach the end of their useful life.
    • He inquired as to when the Main Cable Recoating project will be undertaken. In response, Mr. Mulligan stated that it is anticipated that the Main Cable Recoating project will begin in FY 07/08, and that the project is estimated to take three years to complete.

Director Hernández inquired as to whether staff has data available regarding the point at which the Bridge toll becomes so high that people choose not to drive across the Bridge. In response, Mr. Wire explained that staff studied the effect of the 66% cash toll increase in 2002 and found that it was difficult to directly correlate the toll increase to declining traffic levels, due to the regional economic conditions at the time. He stated that generally speaking, a toll increase will result in a slight dip in traffic levels, followed by a rebound. He noted that the public’s willingness to pay a higher toll relates primarily to how the cost of living compares to their earnings, as well as how the Golden Gate Bridge toll compares to tolls on other bridges in the Bay Area.

  • Director Boro made the following comments:
    • He stated that it would be worthwhile to engage the District’s legislative advocates in Sacramento and Washington, D.C., to pursue legislation that would allow the District to seek other revenue sources beyond tolls, such as issuing bonds or raising taxes within the counties that make up the District. He noted that if an agency issues revenue bonds, it must prove that it has the financial wherewithal to pay the bonds; therefore, future toll increases would still be necessary.
    • He stated that New York City has relatively high tolls because the revenue is used to subsidize trains, subways and buses, and that the District is unique on the West Coast in that it uses Bridge tolls to subsidize its transit operations.
    • He requested that staff prepare a historical chart showing how the price of gasoline has compared with the price of Golden Gate Bridge tolls over the years.
  • Ms. Kupersmith stated that it is interesting to note that if the Golden Gate Bridge toll had increased each year since 1937 at the same rate as inflation, the toll would have reached approximately $15.71 by 2002. She noted that while the toll has increased at a rate considerably less than the rate of inflation, the public still considers the Bridge toll as a form of taxation.
  • Director Stroeh stated that although he supports the idea of seeking other revenue sources beyond tolls, he acknowledged that it would take approximately 5 to 10 years to pass legislation to change the District’s charter. He further stated that action needs to be taken in the short term regarding a toll increase in order to reduce the deficit.
  • Ms. Kupersmith stated that staff is requesting specific direction from the Board at this Workshop regarding the timing of a toll increase. She noted that if the Board decides to implement a toll increase in July 2008, staff would then prepare a recommendation for action in January 2008 to begin the public outreach process. In response, Director Stroeh suggested that the Board revive the Strategic Plan Advisory Committee with the task of reviewing the toll increase options and coming up with a recommendation to the full Board in January 2008.
  • Director McGoldrick inquired as to the amount of the toll subsidy for the District’s ferry system. In response, Mr. Wire stated that the ferry subsidy averages between $9 and $10 million in toll revenue. He further stated that the amount of toll subsidy for the District’s bus system is approximately $25 million. Additionally, Ms. Kupersmith stated that from another perspective, the farebox recovery is 40% for the ferry system and 25% for the bus system.

A discussion ensued among various Board members regarding the timing of a toll increase and whether or not to consider a bicycle and pedestrian toll for the recreational use of the Bridge sidewalks.

  • Director Sanders made the following comments:
    • She expressed her support for Option No. 5, noting that it would be logical to pursue a toll increase as soon as possible given the fact that the Corporate Partnership Program was dropped by the Board.
    • She commented that since the Golden Gate Bridge is an iconic monument that attracts visitors from around the world, the District should look beyond the Bridge’s role as simply a toll facility and consider instituting a toll for the users of the Bridge sidewalks.
    • She expressed her support for a weekend recreational user fee for the Bridge sidewalks, stating that, in her opinion, it is inequitable to require daily commuters to pay tolls to subsidize the free recreational use of the Bridge sidewalks.
  • President Moylan concurred with Director Sanders’ above-stated comment, noting that when he has visited other great monuments and attractions around the world, there is usually a fee charged to visitors. He stated that it would be fitting to charge pedestrians a fee to walk on the Bridge sidewalks, perhaps by selling a Bridge souvenir ticket. He further stated that in deference to bicyclists who commute across the Bridge, bicyclists could ride across the Bridge for free during commute hours.
  • Director Newhouse Segal expressed her support for Option No. 5, which would implement a $1.00 increase in both cash and FasTrak tolls on July 1, 2008. She further suggested that if a recreational sidewalk use toll is implemented, perhaps the District could implement a membership program that would provide discounts to frequent users of the Bridge sidewalks.
  • Director Pahre requested that staff resurrect the list of revenue generation strategies that was discussed by the Board several years ago for the benefit of the newer members of the Board. In response, Ms. Kupersmith stated that staff would present such a list to the Board, to include the actual revenue generation potential for each strategy.
  • Director Middlebrook expressed her support for Option No. 5, as well as pedestrian tolls, but cautioned that a toll for bicyclists may be controversial, as it was in the past. She stated that it would be prudent to combine the sidewalk use toll with the Bridge toll process, in terms of timing.
  • Director McGoldrick commented on his reluctance to take up the matter of a bicycle and pedestrian toll due to the contentious nature of the issue in the past.
  • Ms. Kupersmith reported that the District is currently engaged in pending litigation regarding a bicycle accident on the Golden Gate Bridge, the outcome of which might have bearing on the future use of the Bridge sidewalks.
  • Director Newhouse Segal stated that the question of what constitutes the legal and proper use of the Golden Gate Bridge sidewalks might also have bearing on the Suicide Deterrent project.
  • Director Eddie made the following comments:
    • He expressed his support for Option No. 5, noting that, as a toll facility, the District is obligated to solve its financial problems through the collection of tolls.
    • He stated that while it may be useful to consider other future revenue sources like taxes or bonds as a means to fund the District’s transit system, the Board must make a decision in the near term regarding a toll increase.
    • He suggested charging a fee to bicycle rental companies and tour bus companies, whose customers use the Golden Gate Bridge sidewalks.
  • Director McGlashan made the following comments:
    • He concurred with Director Sanders that the Golden Gate Bridge is considered a great monument, and suggested that the Board investigate fundraising mechanisms that could be associated with the stewardship of the Bridge as a monument.
    • He expressed his opposition to the idea of charging a toll to bicyclists who commute across the Golden Gate Bridge, noting that in his opinion, the District should reward commuters who cross the Bridge without using an automobile. He further stated that he would consider instituting a toll for weekend recreational users of the Bridge sidewalks.
    • He stated that if the District considers seeking the legislative authority to use gasoline tax revenue, it would be practical to create a nexus between automobile use and non-automobile transit options.
    • He expressed his support for considering other creative fundraising ideas, such as charging tour bus operators and issuing bonds or raising taxes, but cautioned against entangling those issues in the Golden Gate Bridge toll increase process.
    • He noted that the Doyle Drive tolling question must be considered within the context of the Golden Gate Bridge toll increase.
  • Director Reilly requested that for the benefit of the newer members of the Board of Directors, staff should revisit the actual potential revenue that could be raised by a bicycle and pedestrian toll on the Bridge sidewalks, noting that past studies have shown that given the amount of costs associated with collecting such a toll, the net revenue to be gained would be comparatively small.
       
  c. Motion Relative to Proposal to Increase Golden Gate Bridge Tolls
       
 

Following a lengthy discussion by the Board of Directors, the following motion was made and seconded by Directors MOYLAN/COCHRAN:

It is recommended that the Board of Directors authorize staff to take the appropriate steps to begin the process for implementation of toll increase Option No. 3 (A $1.00 increase in FasTrak tolls on January 1, 2009, plus a $1.00 increase in the cash toll on January 1, 2009) and Option No. 5 (A $1.00 increase in FasTrak tolls on July 1, 2008, plus a $1.00 increase in the cash toll on July 1, 2008), beginning January 2008.

Carried

AYES (16): Directors Brown, Cochran, Eddie, Grosboll, Hernández, McGlashan, McGoldrick, Middlebrook, Newhouse Segal, Pahre, Reilly, Sanders, Sandoval and Stroeh; President Moylan; First Vice President Boro
NOES (0): None
ABSENT (3): Directors Dufty, Kerns; Second Vice President Ammiano

       
  d. Discussion Relative to the Doyle Drive Toll
       
 

Ms. Kupersmith provided an update on the timing of the Doyle Drive Project, including information regarding the Urban Partnership Program (UPP), a national program funded by the U.S. Department of Transportation (DOT). She stated that the DOT solicited applications from cities across the country and that San Francisco was chosen as one of five cities selected to receive UPP funding, of which San Francisco’s portion will be approximately $160 million. However, this UPP funding is contingent upon the implementation of a toll on Doyle Drive by mid-2009. She further stated that as a first step in the legislative process to secure tolling authority for the SFCTA, State Senator Leland Yee would be introducing legislation in January 2008 to request such authority.

Ms. Kupersmith further announced that quite unexpectedly, the District received a $12.8 million allocation as part of the $160 million in UPP funding, to be used for Ferry Division capital project. She stated that staff is proposing that this $12.8 million in capital funding be used to parking improvements at the Larkspur Ferry Terminal where there is a pressing need to expand parking due to increased ferry ridership.

President Moylan invited Jose Luis Moscovich, Executive Director of the SFCTA, to address the Board of Directors regarding tolling on Doyle Drive.

Mr. Moscovich provided the Board with an overview of the Doyle Drive tolling proposal, noting the following points:

  • He stated that the political realities in both Sacramento and Washington, D.C., show that it is unlikely that there will be a significant increase in the gasoline tax in the near future. He stated that the State of California is relying more on the issuing of bonds, rather than gasoline tax revenues, to pay for transportation infrastructure improvements.
  • He noted that the District has an advantage over other regional transit agencies in its ability to raise revenue through tolls.
  • He provided additional details regarding the UPP, noting that the application to the DOT was submitted after consultation with District staff and in partnership with the MTC and other Bay Area transit agencies. He stated that although the UPP application had requested approximately $400 million in funding for a variety of projects throughout the Bay Area, the DOT chose to fund only those projects that most closely matched the UPP project goals to promote innovative congestion-relief proposals. He noted that San Francisco received the bulk of the $160 million earmarked for the Bay Area, to be used to implement congestion pricing on Doyle Drive, as well as some ancillary projects that would reduce traffic congestion in downtown San Francisco.
  • He dispelled the notion that the preferred Presidio Parkway option for replacing Doyle Drive is a “gold-plated” project, noting that the total cost to build the Presidio Parkway option would only be 10 percent more than the cost to replace Doyle Drive with a similar elevated structure. He stated that the Presidio Parkway option is preferred because it is more suitable for a National Park setting and because it provides direct connectivity from Doyle Drive to Presidio roads.
  • He stated that the DOT requires that in order for the SFCTA to be eligible to receive the UPP funding for Doyle Drive, the authority to collect a toll on Doyle Drive must be in place by March 31, 2008, and that the toll collection must be implemented by September 2009. Therefore, a decision by the District needs to be made before January 2008.
  • He stated that while the SFCTA seeks legislative authority to collect tolls on Doyle Drive, he is asking that as a fallback option, the District consider using its tolling authority to collect Doyle Drive tolls on behalf of SFCTA temporarily, until such time that SFCTA receives permanent authority to collect tolls.
  • He stated that if the District does collect Doyle Drive tolls, a clear distinction would be made between Golden Gate Bridge tolls and Doyle Drive tolls.
  • He stated that in consideration of the suggestions that the District seek legislative authority to issue bonds for additional sources of revenue, he offered the possibility of a joint financing program between the District and the SFCTA, using the SFCTA’s existing bonding authority to raise funds for both the construction of Doyle Drive and key Bridge capital projects.


Discussion by the Board continued, including the following:

  • Director McGlashan made the following comments:
    • He stated that he would support a congestion pricing model for tolling on Doyle Drive that was not connected to the Golden Gate Bridge. He noted that other cities around the world, such as London, use a simple electronic overhead system to collect tolls using congestion pricing. He stated that such a system installed on Doyle Drive exits would effectively disassociate the Doyle Drive toll from the Bridge toll.
    • He suggested that the SFCTA should consider the weekend northbound use of Doyle Drive as a secondary source of congestion when setting the Doyle Drive congestion pricing.
    • He suggested that the District Board of Directors approve a position of support for the SFCTA’s efforts to seek legislative authority to collect tolls on Doyle Drive, as long as such a toll was collected from all users of Doyle Drive.
  • Director Brown expressed his opposition to having the Golden Gate Bridge Toll Plaza serve as the collection point for any tolling on Doyle Drive.
  • Director Boro made the following comments and inquiries:
    • He expressed his concerns regarding the Doyle Drive toll, particularly if that toll is collected on top of the increased Bridge toll at the Golden Gate Bridge Toll Plaza. He stated that it is imperative that the Board of Directors engage in a formal discussion regarding the District’s potential role in collection of the Doyle Drive toll.
    • He inquired of Mr. Moscovich as to whether the District or the SFCTA would be obligated to hold public hearings if the District were to assume temporary authority to collect tolls for Doyle Drive. In response, Mr. Moscovich stated that the District’s Board of Directors would need to take action to initiate the District’s temporary Doyle Drive tolling authority, including all necessary public outreach leading up to such an action. He suggested the possibility of joint SFCTA-District public hearings, to ensure that the public understands that the Doyle Drive toll proposal is connected to the SFCTA, not the District.
    • He stated that it would be difficult for North Bay leaders to support the concept of a Doyle Drive toll collected from North Bay residents at the Golden Gate Bridge Toll Plaza, given the fact that only a small percentage of traffic bound for downtown San Francisco originates from the North Bay. In response, Mr. Moscovich stated that the public is keenly interested in accountability for any toll collected on Doyle Drive, and that if such a toll were implemented, the SFCTA would issue bonds with the covenant that the tolls collected on Doyle Drive would be used solely to ensure public safety by replacing Doyle Drive.
  • Director Reilly expressed her concerns about the potential for traffic impacts in the surrounding neighborhoods from people who take detours to avoid paying a toll on Doyle Drive. In response, Ms. Moscovich stated that the use of overhead toll collection canopies installed at all exits to Doyle Drive would mitigate the incentive for Doyle Drive users to use surrounding streets.
  • Director Pahre inquired as to why the preferred alternative for the Doyle Drive project does not include either the Merchant Road Slip Ramp or a staging area for the District’s proposed Movable Median Barrier transfer vehicle. In response, Mr. Moscovich explained that at the District’s request, the SFCTA included the Merchant Road Slip Ramp option in the final design for the Presidio Parkway preferred alternative, but that the option was eliminated by the National Park Service (NPS) and the Presidio Trust, because the NPS did not want any additional parkland used to accommodate the Slip Ramp. In addition, Mr. Moscovich stated that the environmental documents for the Doyle Drive project included analysis of a Movable Median Barrier staging area built into the project, but that such a feature was not included as a final requirement for the project, due to lack of agreement from the NPS.
  • President Moylan inquired as to whether the SFCTA contemplates collecting Doyle Drive tolls only at the Golden Gate Bridge Toll Plaza. In response, Mr. Moscovich stated that the Golden Gate Bridge Toll Plaza is only one of many options, and that electronic toll collecting canopies could be positioned at all Doyle Drive exits, in order to have maximum flexibility to capture all users of Doyle Drive.
  • Director Newhouse Segal made the following comments:
    • She stated that it is an honor that San Francisco was chosen by the DOT as a recipient of UPP funding, and expressed her support of the concept of congestion pricing.
    • She expressed her support for tolling on Doyle Drive, but only if the collection point is not at the Golden Gate Bridge Toll Plaza.
    • As a resident of a neighborhood adjacent to Doyle Drive, she stated her concerns about impacts on neighboring streets from Doyle Drive users seeking to avoid the toll.
    • She stated that the District and the SFCTA should work cooperatively through a formal process with respect to a toll on Doyle Drive.

Ms. Kupersmith summarized the issues associated with the proposed Doyle Drive toll. She noted that the Doyle Drive project has been in the planning stages for several years, and that representatives of the SFCTA have made numerous presentations to the District regarding the status of the project. She stated that starting about eight years ago, the SFCTA has been requesting that the District agree to contribute a portion of the Golden Gate Bridge toll revenues to help fund the Doyle Drive project, since Doyle Drive is the southern approach to the Bridge. She also stated that in August 2007, SFCTA staff made a presentation regarding proposed initiatives that would reduce congestion in downtown San Francisco, including the concept of implementing a toll using congestion pricing on Doyle Drive. She further stated that the SFCTA was awarded $160 million in UPP funding, of which $40 million is available for construction of the Doyle Drive project.

She stated that the following policy decisions facing the District that must be considered by the Board of Directors:

  1. Does the District want the Golden Gate Bridge Toll Plaza to be a collection point for a Doyle Drive toll?
  2. While the SFCTA is in the process of seeking legislative authority to collect Doyle Drive tolls, is the District willing to use its tolling authority on behalf of the SFCTA, on a temporary basis?
  3. If the SFCTA is not successful in receiving legislative authority to collect Doyle Drive tolls, is the District willing to use its tolling authority on behalf of the SFCTA, if it is legally allowed to do so?

Discussion by the Board continued, including the following:

  • Director Boro made the following comments and inquiries:
    • He inquired as to why the District and North Bay residents are bearing the burden of the Doyle Drive toll when none of the letters of support for the SFCTA’s UPP application came from North Bay legislators. In response, Mr. Moscovich explained that although the original application for $400 million included projects in the South Bay and East Bay, the DOT focused its grant on innovative projects that would ease congestion in San Francisco.
    • He expressed his concerns that this meeting has been the first opportunity for the full Board of Directors to learn about the District’s potential role in collection of the Doyle Drive toll. He stated that the Board needs a clear understanding of all the details associated with the Doyle Drive toll before making such an important policy decision.
  • Director McGoldrick, who also serves as Chair of the SFCTA, provided additional clarification regarding the proposed Doyle Drive toll, noting that the key issue regarding Doyle Drive is safety. He further stated that in light of the economic hardship that the Bay Area would face if Doyle Drive were destroyed by a catastrophe, it is imperative to proceed with the Doyle Drive replacement project. He noted that the project is currently only 70 percent funded, and that the proposed Doyle Drive toll is part of a push to get the project fully funded.
  • Director McGlashan made the following comments and inquiries:
    • He inquired as to the risks associated with the SFCTA’s request to the California State Legislature for tolling authority. In response, Mr. Moscovich stated that while the SFCTA has some political support for its efforts, there is not 100 percent certainty that the SFCTA will be granted tolling authority before the short UPP deadline of March 31, 2008.
    • He urged the Board to agendize a discussion on the Doyle Drive toll as soon as possible, in order to articulate a policy position on the question of Doyle Drive tolling authority for the SFCTA.
    • He expressed his support for the innovative congestion management solutions put forth by the SFCTA.
  • Attorney Miller stated that the District needs to know exactly what the SFCTA is asking of the District in order for the Board of Directors to make an informed decision regarding tolling on Doyle Drive. He noted that there may be legal questions for the District to consider relative to serving in a back-up capacity to the SFCTA with respect to collecting the toll, and that once the specifics are known, an appropriate legal opinion can be prepared in order to advise the Board. In response, Mr. Moscovich stated that the SFCTA would provide documentation to the Attorney for the District, including the term sheet from the UPP grant prepared by the DOT, by the beginning of next week.
  • Director Newhouse Segal suggested that a joint meeting of both agencies – the SFCTA and the District – be held in order to further explore the matter of tolling on Doyle Drive.
  • Director Sanders stated that the District should do all it can to support federal grant money coming to the Bay Area for transportation and congestion relief projects.
  • Mr. Moscovich noted that the SFCTA would begin its efforts to seek legislation in January 2008, and that they would appreciate it if the District reached a policy decision regarding the Doyle Drive toll in December 2007.
       
ADJOURNMENT
       
2. All business having been concluded, the meeting was adjourned at 12:00 p.m.
       


Respectfully submitted,

/s/ Janet S. Tarantino
Secretary of the District