December 16, 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, December 16, 2010, at 10:35 a.m., Chair Stroeh presiding.

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

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

Staff Present: General Manager Denis Mulligan; 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/Bus Transit Division Teri Mantony; 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: Nancy Jones, PFM Asset Management, LLC

     
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.

At the meeting, Nancy Jones reported that interest rates are very volatile. She noted that on December 13, 2010, the two-year Treasury rate was at 42 basis points, whereas the rate today is 67 basis points. She reported that, although indications are that the national economy is improving, concerns remain that state/local governments and foreign countries may be unable to repay loans. For example, while retail sales and sales of automobiles are reportedly increasing, the State of Rhode Island has declared bankruptcy. In addition, the quantitative easing employed by the Federal Reserve is causing consternation in financial markets.

She reported that, because PFM purchased short-term commercial paper on the District’s behalf, which matures in three to six months, additional funds will become available for purchasing longer-term securities, which are now projected to provide a better return on investment. She stated that the District’s portfolio is very well diversified, and that the District enjoys a AAA rating. She noted, however, that the Gross Domestic Product, which grew at a rate of 2.5% for the fifth straight quarter, must grow more quickly in order to ease unemployment.

Staff recommended and the Committee concurred by motion made and seconded by Directors EDDIE/MOYLAN 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 November 1, 2010, through November 30, 2010:
  b. Ratify investments made by the Auditor-Controller during the period November 9, 2010, through December 6, 2010, as follows:
     
Security
Purchase Date
Maturity Date
Original Cost
Percent Yield
US Treasury Notes
11/15/10
11/30/14
2,649,310.55
1.14
US Treasury Notes
11/19/10
11/30/14
2,472,946.88
1.19
     
  c. Authorize the Auditor-Controller to re-invest, within the established policy of the Board, investments maturing between December 7, 2010, and January 2011, 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 November 2010, as prepared by PFM.

Action by the Board at its meeting of January 14, 2011 – Resolution
CONSENT CALENDAR

     
 
AYES (11): Directors Cochran, Elsbernd, Grosboll, McGlashan, Moylan, Newhouse Segal, Snyder and Stroeh; Second Vice President Eddie; First Vice President Reilly; President Boro (Ex Officio)
NOES (0): None
     
2.

Authorize Budget Increase and Budget Transfers in the FY 10/11 Budget for Capital Projects

In a memorandum to Committee, Auditor-Controller Joseph Wire, District Engineer Ewa Bauer and General Manager Denis Mulligan reported on staff’s recommendation to authorize a budget increase and two budget transfers.

The staff report stated that the following three projects have resulted in higher engineering staff costs than originally anticipated due to the increased coordination and oversight required for construction work staged around ongoing operations at project locations:

  a.
Larkspur Ferry Terminal Accessible Restrooms and Ramps, Capital Project No. 0918, requires a budget increase in the FY 10/11 Ferry Transit Division Capital Budget, in the amount of $32,000.00, to be funded with Public Transportation Modernization, Improvement and Service Enhancement Account funds;
  b.
San Rafael District Administration Building HVAC Improvements, Capital Project No. 0712, requires a budget transfer from the FY 10/11 District Division Operating Budget/Engineering Department to the FY 10/11 Bus Transit Division Capital Budget, in the amount of $47,430.00; and,
  c.
Toll Plaza Pavement and Access Improvements, Capital Project 0804, requires a budget transfer from the FY 10/11 District Division Operating Budget/Engineering Department to the FY 10/11 Bridge Division Capital Budget, in the amount of $17,000.00.
     
 

A copy of the staff report is available from 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 REILLY/MOYLAN 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 a budget increase and budget transfers, as follows:

  a.
A budget increase in the FY 10/11 Ferry Transit Division Capital Budget, in the amount of $32,000.00, for the Larkspur Ferry Terminal Accessible Restrooms and Ramps Project, Capital Project No. 0918, to be 100% funded with Public Transportation Modernization, Improvement and Service Enhancement Account funds;
  b.
A budget transfer from the FY 10/11 District Division Operating Budget/Engineering Department to the FY 10/11 Bus Transit Division Capital Budget, in the amount of $47,430.00, for the San Rafael District Administration Building HVAC Improvements Project, Capital Project No. 0712; and,
  c.

A budget transfer from the FY 10/11 District Division Operating Budget/Engineering Department to the FY 10/11 Bridge Division Capital Budget, in the amount of $17,000.00, for the Toll Plaza Pavement and Access Improvements Project, Capital Project No. 0804.

Action by the Board at its meeting of December 17, 2010 - Resolution
NON-CONSENT CALENDAR

     
  AYES (11): Directors Cochran, Elsbernd, Grosboll, McGlashan, Moylan, Newhouse Segal, Snyder and Stroeh; Second Vice President Eddie; First Vice President Reilly; President Boro (Ex Officio)
NOES (0): None
     
3.

Monthly Review of Golden Gate Bridge Traffic/Tolls and Bus and Ferry Transit Patronage/Fares (for Five Months Ending November 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 five months ending November 30, 2010. Copies of the reports are available in the Office of the District Secretary and on the District’s web site.

     
4. Monthly Review of Financial Statements for Five Months Ending November 2010
     
  a.

Statement of Revenues 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.

     
  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.

     
5.

Public Comment

There was no public comment.

     
6.

Adjournment

All business having been concluded, the meeting was adjourned at 10:40 a.m.

     

 

Respectfully submitted,

s/ J. Dietrich Stroeh, Chair
Finance-Auditing Committee