MEMBERS PRESENT: Michael Burns, Jose´ Cisneros Don Gage, Jim Hartnett, Arthur Lloyd, John McLemore, Michael Nevin, Ken Yeager

MEMBERS ABSENT: Sophie Maxwell

MTC LIAISON: Sue Lempert

STAFF PRESENT: Michelle Bouchard, George Cameron, Joan Cassman, Cheryl Cavitt, Robert Doty, Rita Haskin, Gigi Harrington, Chuck Harvey, Jennifer Hardie, Ian McAvoy, David Miller, Mark Simon

Chair Nevin called the meeting to order at 10:04 a.m. and Jennifer Hardie led the Pledge of Allegiance.

PUBLIC COMMENT

Jeff Carter, Burlingame, said a co-worker moved to Burlingame specifically to be within walking distance from the Broadway station and now is unhappy that the Broadway station service will be suspended. He said a shuttle service will not suffice regardless of how robust the service is. He said people chose to live near train stations for train service, even if only local service is provided.

CONSENT CALENDAR

The Board unanimously approved the following items under the Consent Calendar:

1. Approval of Minutes of April 22, 2005
2. Statement of Revenue & Expenses, March 2005
3. Authorization to Execute a Lease Addendum to Extend Lease of Warehouse at 4000 Campbell Avenue in Menlo Park Until December 31, 2009 {Resolution 2005-17}
4. Approval of Construction and Maintenance Agreement with City of Brisbane for the Tunnel Avenue Overhead Bridge Project {Resolution 2005-18}
5. Authorization to Execute a Change Order to the Contract with Drill Tech Drilling and Shoring, Inc. for Additional Grouting of Tunnel 3 {Resolution 2005-19}
6. Submittal of a Five-Year Prioritization Program (5YPP) to the San Francisco County Transportation Authority as a Condition for Receiving Proposition K Funds
7. Authorization for Filing of Applications to MTC to Program Federal Funds for Caltrain Capital Projects

Director Gage asked that item (g), Authorization for Filing of Applications to MTC to Program Federal Funds for Caltrain Capital Projects, be removed from consent for further discussion.

The motion to approve items (a)-(e) of the Consent Calendar was approved unanimously, by roll call.

With regard to item (g) of the Consent Calendar, Director Gage said during the preparatory meeting with staff, there were discussions of the JPB formula and using the MTC funds for the operating budget deficit and he would like to have further discussions with staff. He said the funds that are received by MTC are not being used for preventative maintenance, as Valley Transportation Authority (VTA) does, and he thinks that should be looked into.

Director McLemore said the budget is delicate issue. However, the VTA representatives were surprised that the budget shortfall scenarios did not include the MTC 5307 grant funds. He asked that staff review the MTC 5307 grant funds again.

Michael Scanlon, Executive Director, said there are provisions to use capital money. Twice in any 10-year period, capital dollars can be used to offset operating expenses, but certain requirements need to be met with the MTC. The MTC policy includes having a long-term plan on how the agency will resolve its budget issues. Staff has analyzed the budget numbers and the maximum amount of money that can be used as capital maintenance is $3.8 million, which is lower than other agencies because Caltrain did mid-life rebuild on rolling stock making it ineligible for capitalized maintenance. Mr. Scanlon said there is $3.1 million remaining in the CTX and Trackwork projects, which can be utilized for maintenance and to offset operating costs. Staff has analyzed that $3.1 million can be capitalized this year without triggering the capital maintenance process with MTC. By utilizing the existing capital funds, Mr. Scanlon said Caltrain would receive $700,000 less this year but would preserve the opportunity to use $3.8 million for two more years within the next 10 years.

Director Gage said staff was able to reduce the budget gap to $900,000 and if $700,000 could be used as capitalized maintenance, the gap would be reduced without having to have increased member agencies contributions.

Director Hartnett said it is important to have long-term dependable financial support for Caltrain. He said he is uncomfortable using one-time funds to bridge budget gaps.

Director Burns asked if the $3.1 million in the grant savings could be used in addition to the $3.8 million federal money that would have to be used for track maintenance work.

Mr. Scanlon said the $3.1 million of grant savings would be lost for maintenance if it was not used.

Ian McAvoy, Chief Development Officer, said the $3.1 million would either be spent on future capital improvement projects or the money expires and the funds would be put back into the overall capital program to get reallocated. Mr. McAvoy said because the exemption was taken to do the mid-life overhaul on rolling stock, federal money can not be used for annual maintenance.

Director Gage said VTA has been successful in using money for rolling stock and he would Caltrain staff to work with VTA staff to discuss the issue prior to the adoption of the FY2006 budget.

Director McLemore asked if the purpose of item (g) of the Consent Calendar, Authorization for Filing of Applications to MTC to Program Federal Funds for Caltrain Capital Projects, was to allow the use of 5307 grant funds in the future.

Mr. McAvoy replied that the item involves two issues. First, the San Francisco Transportation Authority requires a multi-year plan to show local match requirements (item (f) from the Consent Calendar). Second, submittal of grant applications to MTC takes time.

Mr. McAvoy said even if the JPB goes through the process to submit the applications, the grants may not be available until next summer.

Director McLemore asked why the applications need to be submitted now.

David Miller, Legal Counsel, said this item enables the Board to get in line for funds that are needed.

The motion to support authorization for filing of applications to MTC to program federal funds was unanimously approved by roll call.

CHAIRPERSONS REPORT

Chair Nevin commended staff for the marketing outreach with regard to the two additional Baby Bullets, which started service May 2.

MTC LIAISON REPORT

Sue Lempert reported:

• MTC was able to locate an additional $9 million for Caltrain, BART and other agencies. The funds are a one-time funding source and can only be allocated to projects that are already in progress.
• MTC has been served with a lawsuit by a variety of groups who claim that funds are being allocated to BART and Caltrain in a manner that discriminates against low-income and ethnic minority transit riders.
• At the end of May the Joint Policy Committee will be taking a tour of the Dumbarton Rail Corridor, specifically looking for possible Transit Oriented Developments.
• Many San Mateo County residents are disappointed with the service suspensions at Atherton and Broadway stations as well as service reductions to other San Mateo County stations. She said this is a dedicated Board and she hoped they would continue to advocate for Caltrain to their other constituencies.

REPORT OF THE CITIZENS ADVISORY COMMITTEE (CAC)

Brian Wilfley reported at the next CAC meeting, May 18, there will be a presentation on electrification.

REPORT OF THE EXECUTIVE DIRECTOR

Michael Scanlon, Executive Director, reported:

• Performance Statistics for March 2005
1. Average Weekday Ridership was up 12.2 percent, from 25,941 riders to 29,118.
2. Total Ridership was up 17 percent from 686,660 riders to 803,654.
3. Total Revenue was up 22 percent from $1.6 million to $1.9 million.
4. On-Time Performance was up 17.3 percent from 82.6 percent to 96.9 percent.
5. Shuttle Ridership was up 22.1 percent from 3,497 riders to 4,271.
• The additional morning southbound Bullet is attracting over 400 riders. The additional afternoon Bullet is growing ridership gradually. The afternoon train runs at a time that is not ideal for some riders but it operates without additional crews or expenses.
• SBC Park baseball service ridership has increased 22 percent over last April.
• Fuel prices continue to be a problem. Gas prices have been above budgeted amounts for the past 10 weeks.
• The monthly Safety and Security Report was distributed. In conjunction with Operation Lifesaver, Caltrain will be participating in an Officer-on-the-Train event on May 18 from Redwood City to Menlo Park.
• As Ms. Lempert said, MTC has been served a lawsuit in which Caltrain is a real party in interest.

Mr. Miller said the alleged violation is of Title VI of the Civil Rights Act and the Equal Protection Clause of the United States Constitution in the way that MTC programs its funds. The suit's contention is that those decisions led to a disproportionate impact on people of color and otherwise disadvantaged persons. The lawsuit does not involve AC Transit but the Amalgamated Transit Union, which represents some of their employees, and several of AC Transit riders are parties to the lawsuit. He said he has been in regular contact with legal counsel for MTC. Mr. Miller further noted that a negative outcome in the case would adversely affect the JPB and BART. As of yesterday the lawsuit had not been served. The general counsels for the interested agencies and respective staffs will coordinate to ensure that the relevant facts are presented and the best possible defense is mounted. Mr. Miller said he will keep the Board informed of developments in the case.

AWARD OF CONTRACT TO VIACOM OUTDOOR GROUP, INC. FOR EXTERIOR TRAIN ADVERTISING

Rita Haskin, Chief Communications Officer, said Staff Coordinating Council (SCC) recommends the Board award a contract to Viacom Outdoor Group, Inc. (Viacom) of New York, New York, for exterior train advertising for a base three-year term with a provision for up to two additional one-year option terms. The contract awarded to Viacom in 2004 for a one-year demonstration program has proved very successful in generating additional revenue for the JPB. There were a few adjustments made in the new contract, including having all windows in the vestibule uncovered while leaving up to 10 percent of all other windows uncovered. The contract will begin June 1.

Director Burns asked for clarification with regard to the annual guaranteed revenue amount of $36,000.

Ms. Haskin said under the current demonstration program, the JPB receives approximately $34,000 a month and there is not a guarantee of a specific revenue amount. The new contract states that if Viacom is unable to sell advertising, the JPB would still receive $36,000 in revenue. Ms. Haskin said Viacom currently has three trains sold for advertising.

Director Cisneros asked if staff had an annual estimate projection.

Ms. Haskin said staff projected the demonstration project would yield $360,000 in annual revenues. The actual amount received was $427,000. Within the budget, $280,000 has been earmarked.

Francis Wong said he is concerned with having the windows covered because passengers should be allowed the option to look out an unobscured window.

Jeff Carter, Burlingame, said he supports train-wrapping because it provides revenue. He suggested looking at wrapping more than three trains to help the budget. He agrees that at 10 percent of windows should be uncovered.

Mr. Scanlon said 10 percent of windows will be uncovered in addition to the vestibules being uncovered. He said train wraps will be done on up to four consists, which is the number of trains staff feels is the right amount to keep the wraps attractive to advertisers without reaching a saturation point.

REJECTION OF LOW MONETARY BID AS NON-RESPONSIVE AND AUTHORIZING AWARD OF CONTRACT FOR PROVIDING RAIL SIGNAL EQUIPMENT

George Cameron, Chief Administration Officer, said SCC recommends the Board reject the low monetary bid for providing rail signal equipment received from GE Transportation Systems Global Signaling, LLC (GE) of Blue Springs, Missouri, as non-responsive; award a contract to the next lowest responsive and responsible bidder, Railroad Signal International, LLC (RSI) of Tulsa, Oklahoma, for a total estimated cost of $337,347; and authorize the Executive Director to execute a contract with RSI in full conformity with the terms and conditions of the bid specification documents.

The motion to reject the low monetary bid from GE Transportation Systems Global Signaling, LLC (GE) and award a contract to Railroad Signal International, LLC (RSI) was unanimously approved, by roll call, and Resolution 2005-22 was adopted.

APPROVAL OF THE PROPOSED DISADVANTAGED BUSINESS ENTERPRISE (DBE) OVERALL ANNUAL GOAL FOR FY2006

Raymond Lee, DBE Officer, said the JPB's Review Committee recommends Board approval to publish for public inspection and comment the proposed DBE overall annual goal of 9.2 percent for Federal Transit Administration (FTA) funds for Fiscal Year 2006. In the event that no public comments are received that require a change to the proposed goal, authorize the Executive Director to formally adopt the goal for FY 2006; and Authorize the Executive Director to submit the DBE overall annual goal to the Federal Transit Administration by the deadline of August 1, 2005.

The proposed DBE overall annual goal of 9.2 percent for FTA-assisted contracts is based upon the JPB's assessment of FTA assisted contracting activity for FY 2006 and the projected availability of ready, willing and able DBEs to participate in this work. Similarly, the JPB assessed potential FHWA assisted contracting activity for FY 2006 and determined that there will be no new contracts to be funded with FHWA financial assistance in FY 2006.

For FY 2005, the overall annual goal was 11.5 percent for FTA-assisted contracts and 12 percent for FHWA-assisted contracts. As of February 28, 2005, JPB expenditures to DBEs total approximately 7 percent of FTA-assisted contracts, and zero percent of FHWA-assisted contracts. It is important to note that the 7 percent FTA expenditures are primarily for on-going contracts for this fiscal period, for which DBEs have not been fully utilized, while total FWHA expenditures have been marginal to date, at less than $10,000.

Taking into consideration the JPB's historic utilization of DBEs, the DBE availability data, as well as the mixed types of contracts projected in FY 2006, the 9.2 percent goal for FTA assisted contracts is a reasonable projection of DBE participation overall for the upcoming fiscal year.

With the Board of Directors' approval, the proposed FY 2006 overall annual goal will be published in general circulation, trade association and DBE oriented media to provide for public inspection for a period of 30 days and public comment for 45 days from the date of publication.

Director Burns asked how the JPB's goal compared to other transit agency goals.

Mr. Lee replied that the goals are not comparable with VTA or Muni because the JPB expends quite a bit with Amtrak support for flagging and watchman services, which reduces the goal. In the areas of construction, the percentages are comparable.

The motion to approve the DBE overall annual goal for FY2006 was unanimously approved, by roll call, and Resolution 2005-23 was adopted.

DISTRIBUTION OF FY2006 OPERATING BUDGET

Gigi Harrington, Chief Financial Officer, said the proposed budget includes the service and fare increases that were approved at the April 22 Board meeting. The new schedule will operate beginning August 1. The first step of the fare increase will go into effect July 1. Ms. Harrington gave a presentation on the proposed FY2006 budget, which included operating revenues totaling $39.9 million expenses totaling $77.6 million and three different scenarios for member contributions. The total operating budget is proposed to total $76.9 million for FY 2006, an increase of $3.2 million, or 4.2 percent, over the FY2005 Revised Budget of $73.7 million. Ms. Harrington said staff would meet with any Board member that would like to go through the budget in more detail.

Director Gage asked if staff analyzed if there was an opportunity to increase parking revenues.

Mr. Scanlon replied parking had been discussed. It was decided not to increase parking fees but rather build the ridership base.

Director Gage asked if there would be enough available parking to accommodate the bold ridership projections with the new schedule.

Mr. Scanlon replied that among the reasons new Baby Bullet B stations were selected was parking capacity.

Director Gage would like staff to look at other options in case the member agencies can not come into agreement to close the remaining budget gap.

Mr. Scanlon said staff will continue to analyze options; however, he is not certain options other than what has already been discussed (weekend service, Gilroy service, midday service) will be available.

Director Yeager asked for an assessment of an increase in member agency contributions and what the timing would be for the member agencies to bring information back to the Board.

Mr. Scanlon replied that staff hopes to know what the member agency contributions will be before the beginning of the fiscal year.

Director Yeager asked if the San Francisco representatives are looking to increase their contribution by 3 percent or 5.9 percent.

Director Burns replied that the representatives had been looking to increase their contribution based on 3 percent. He said he would hope to have a more clear direction of what the contribution will be by the end of the month.

Mr. Scanlon said there is high confidence that San Mateo County will provide a 5.9 percent member contribution increase.

Director McLemore said he has high confidence that Santa Clara County representatives will be able to provide an increase of 3 percent. Director McLemore said he would like to see the budget deficit reframed, specifically referring to the media, where rather than stating Caltrain has a shortfall of $13 million, there is only a shortfall of $1 million since each member agencies feels confident they will be able to provide a 3 percent increase. Director McLemore said he would be concerned if the member agencies provided an increase of 5.9 percent because it would set an expectation for future years.

Mr. Scanlon said if there had been a 3.2 percent increase from each member agency over the past four years, Caltrain may not be in a deficit right now. The 5.9 percent member agency contribution proposals are due to the flat contributions over the past four years.

CORRESPONDENCE

Previously distributed.

LEGAL COUNSEL

No report this month.

DATE/TIME OF NEXT MEETING

Thursday, June 2, 2005, 10 a.m. at the San Mateo County Transit District Administrative Building, 1250 San Carlos Avenue, San Carlos, CA 94070

ADJOURNED

Meeting adjourned at 11:08 a.m.