October 21, 2010

REPORT OF THE FINANCE-AUDITING COMMITTEE/
COMMITTEE OF THE WHOLE

Honorable Board of Directors
Golden Gate Bridge, Highway
and Transportation District

Honorable Members:

A meeting of the Finance-Auditing Committee/Committee of the Whole was held in the Board Room, Administration Building, Toll Plaza, San Francisco, CA, on Thursday, October 21, 2010, at 10:20 a.m., Chair Stroeh presiding.

Committee Members Present (7): Chair Stroeh; Vice Chair Pahre; Directors Eddie, Elsbernd, Grosboll, Moylan and Sobel
Committee Members Absent (2): Director Cochran; President Boro (Ex Officio)
Other Directors Present (4): Directors Kerns, McGlashan, Newhouse Segal and Reilly

Committee of the Whole Members Present (11): Directors Elsbernd, Grosboll, Kerns, McGlashan, Moylan, Newhouse Segal, Pahre, Sobel and Stroeh; Second Vice President Eddie; First Vice President Reilly
Committee of the Whole Members Absent (8): Directors Brown, Campos, Chu, Cochran, Dufty, Sanders and Snyder; President Boro (Ex Officio)

Staff Present: General Manager Denis Mulligan; Acting District Engineer Ewa Bauer; Auditor-Controller Joseph Wire; District Secretary Janet Tarantino; Attorney David Miller; Deputy General Manager/Bridge Division Kary Witt; Deputy General Manager/Ferry Transit Division Jim Swindler; Deputy General Manager/Administration and Development Z. Wayne Johnson; Public Affairs Director Mary Currie; Executive Assistant to the General Manager Amorette Ko; Assistant Clerk of the Board Lona Franklin

Visitors Present: None


1.	Ratify Actions by the Auditor-Controller In a memorandum to Committee, Auditor-Controller Joseph Wire and General Manager Denis Mulligan outlined commitments, disbursements and investments made on behalf of the Golden Gate Bridge, Highway and Transportation District (District). The report also included a copy of the District’s Investment Report from PFM Asset Management, LLC (PFM). A copy of the staff report, with attachments, is available in the Office of the District Secretary and on the District’s web site. Staff recommended and the Committee concurred by motion made and seconded by Directors EDDIE/KERNS to forward the following recommendation to the Board of Directors for its consideration: RECOMMENDATION The Finance-Auditing Committee recommends that the Board of Directors authorize the following actions by the Auditor-Controller:

	a.	The Board of Directors has no commitments and/or expenditures to ratify for the period September 1, 2010, through September 30, 2010:

	b.	Ratify investments made by the Auditor-Controller during the period September 14, 2010, through October 11, 2010, as follows:

Security	Purchase Date	Maturity Date	Original Cost	Percent Yield
Abbey Nat Amer, LLC Commercial Paper	09/28/10	12/22/10	5,499,191.65	0.37
FNMA Notes (Callable)	09/29/10	09/08/14	5,005,000.00	1.47
GECC Corp Notes	10/07/10	09/16/13	3,015,330.00	1.70


	c.	Authorize the Auditor-Controller to re-invest, within the established policy of the Board, investments maturing between October 12, 2010, and November 8, 2010, as well as the investment of all other funds not required to cover expenditures that may become available; and,

	d.	Accept the Investment Reports for September 2010, as prepared by PFM. Action by the Board at its meeting of October 22, 2010 – Resolution CONSENT CALENDAR

	AYES (10): Directors Elsbernd, Grosboll, Kerns, McGlashan, Moylan, Newhouse Segal, Pahre, Sobel and Stroeh; Second Vice President Eddie; First Vice President Reilly NOES (0): None

2.	Authorize Execution of the First Amendment to the Cooperative Agreement with the Metropolitan Transportation Commission Relative to the Procurement of Electronic Ticket Vending Machines and Related Hardware and Software Enhancements from Cubic Corporation dba Cubic Transportation Systems In a memorandum to Committee, Director of Budget and Program Analysis Jennifer Mennucci, Auditor-Controller Joseph Wire and General Manager Denis Mulligan reported on staff’s recommendation to authorize execution of the First Amendment to the Cooperative Agreement with the Metropolitan Transportation Commission (MTC), in the amount of $500,000.00, to increase the funds available for procurement of electronic ticket vending machines and related hardware and software enhancements. The staff report stated that, on February 26, 2010, the Board of Directors approved the execution of a Cooperative Agreement with the MTC under which the MTC would procure, on the District’s behalf, ferry ticket vending machines and associated hardware and software for use as part of the regional ClipperSM program. The staff report stated that the requested additional funds are necessary to buy spare equipment and initial sets of pre-encoded, limited-use tickets. In addition, the District has requested software modifications not originally contemplated that will allow the ticket vending machines to be tailored to the District’s specific needs. A copy of the staff report is available in the Office of the District Secretary and on the District’s web site. At the meeting, Mr. Wire briefly summarized the staff report, stating that the MTC holds the ClipperSM program contract with Cubic Corporation, dba Cubic Transportation Systems (Cubic), under which all hardware and software for the system is provided. He added that the Project is on schedule and expected to come on-line in 2011. Discussion ensued, including the following inquiry: Director Elsbernd inquired as to what the District has learned from the MTC’s experience setting up the ClipperSM program system in San Francisco. In response, Mr. Wire stated that Cubic found glitches with fare gates, customer service, and insufficient availability of cards. He added that the District is aware of the problems that have arisen to date and would plan ahead to avoid similar issues. Staff recommended and the Committee concurred by motion made and seconded by Directors PAHRE/EDDIE to forward the following recommendation to the Board of Directors for its consideration: RECOMMENDATION The Finance-Auditing Committee recommends that the Board of Directors authorize execution of the First Amendment to the Cooperative Agreement, with the Metropolitan Transportation Commission, in the amount of $500,000.00, to increase the funds available for procurement of electronic ticket vending machines and related hardware and software enhancements through the regional ClipperSM program contract; with the understanding that requisite funds are available in the FY 10/11 Ferry Transit Division Capital Budget. Action by the Board at its meeting of October 22, 2010 – Resolution NON-CONSENT CALENDAR AYES (10): Directors Elsbernd, Grosboll, Kerns, McGlashan, Moylan, Newhouse Segal, Pahre, Sobel and Stroeh; Second Vice President Eddie; First Vice President Reilly NOES (0): None

3.	Monthly Review of Golden Gate Bridge Traffic/Tolls and Bus and Ferry Transit Patronage/Fares (for Three Months Ending September 2010) In a memorandum to Committee, Auditor-Controller Joseph Wire and General Manager Denis Mulligan provided a schedule comparing categories of Bridge traffic, as well as a monthly review of Bridge traffic, tolls, transit patronage and fares, for three months ending September 30, 2010. Copies of the reports are available in the Office of the District Secretary and on the District’s web site. At the meeting, Mr. Wire stated that Golden Gate Bridge patronage is slightly lower than for the same period one year ago. He noted that the San Francisco/Oakland Bay Bridge had significant closures last year, which may partially account for the change. He added that both bus and ferry traffic increased during the First Quarter of FY 10/11. Discussion ensued, including the following comment and inquiry: Director Stroeh inquired as to whether the traffic congestion on Doyle Drive may have contributed to the changes. In response, Mr. Wire stated that anecdotal evidence suggests that commuting now takes longer. The traffic congestion also affects buses. He added that the cause of the changes has not yet been determined. Director Reilly commented that the changes could also be the result of the nation’s economy. In response, Mr. Wire stated that, since bus and ferry ridership statistics dropped during previous years, the FY 10/11 First Quarter increase is a welcome change. Action by the Board – None Required

4.	Monthly Review of Financial Statements for Three Months Ending September 2010

	a.	Statement of Revenue and Expenses In a memorandum to Committee, Auditor-Controller Joseph Wire and General Manager Denis Mulligan provided financial statements entitled, Statement of Operating Revenues and Expenses. Copies of the reports are available in the Office of the District Secretary and on the District’s web site. Action by the Board – None Required

	b.	Statement of Capital Programs and Expenditures In a memorandum to Committee, Director of Capital and Grant Programs Gayle Prior, Auditor-Controller Joseph Wire and General Manager Denis Mulligan provided financial statements entitled, Statement of Capital Programs and Expenditures. Copies of the reports are available in the Office of the District Secretary and on the District’s web site. Action by the Board – None Required

5.	FY 10/11 (First Quarter) Quarterly Report on Authorized Budget Adjustments and Budget Transfers In a memorandum to Committee, Auditor-Controller Joseph Wire and General Manager Denis Mulligan provided a report entitled, FY 10/11 First Quarterly Report on Authorized Budget Adjustments and Budget Transfers Executed Under the General Manager’s Authority and Board Authority. A copy of the report is available in the Office of the District Secretary and on the District’s web site. Action by the Board – None Required

6.	FY 10/11 (First Quarter) Quarterly Report on Contracts and Change Orders/Contract Amendments Executed Under the General Manager’s Authority In a memorandum to Committee, Auditor-Controller Joseph Wire and General Manager Denis Mulligan provided a report entitled, FY 10/11 First Quarterly Report on Contracts and Change Orders/Contract Amendments Executed Under the General Manager’s Authority. A copy of the report is available in the Office of the District Secretary and on the District’s web site. Action by the Board – None Required

7.	Public Comment There was no public comment.

8.	Adjournment All business having been concluded, the meeting was adjourned at 10:32 a.m.

Respectfully submitted,

s/ J Dietrich Stroeh, Chair
Finance-Auditing Committee