Or are there some programs that you report on, for whatever reason, are undergoing a cleanup . I mention this because this terminology has been used to question how far along the testing, if you will, or the fixing of our Financial Reporting system is. And since then d. P. W. Is by far the largest department, having the most numbers to actually report, im bringing these questions because we wanted you to share how comfortable you, as project managers and Program Managers, are in looking at the numbers reported from below, and aggregating it to report it to the public and ourselves. What ill say is, i, myself, is not the expert in the financial system, the next time we can have our Deputy Director of finance, and her name is julie dawsen, and she can definitely provide a more indepth analysis of what we are. The term you use, cleanup, refers to us going into each project and trying to assess, i think, some of the labor side, where there has been ongoing effort to true up some of the overhead, which may or may not be captured in some of the labor expenditures. The tract sid contract side is straightforward. It is really on the inhouse labor expenditures, where were still working through with the accountants, just to make sure it captures all of the necessary costs when there is labor expended. I think thats a good idea because this committee, whether officially or unofficially, we have been receiving comments from the general public relating to the soundness and the reliability of our financial system. And since d. P. W. Is by far one of the largest departments, perhaps we should use your department and your experience, that is shared by your c. F. O. S, to keep this committee up to date as to the process of the cleanup on the audits. So i think that is a good idea. Chairman yeah. I agree. Thank you for bringing this up. We are going to talk about our work plan, and i see some possibility in our october meeting. So can we get back to you on that, and maybe peg can help us figure out the right scope of an agenda item . Chairman sure, and to add a comment for those who havent been part of the conversation in the past couple of years. There was a long period of time where reporting was not reliable, and that particularly affected capital funds. And projects had to be looked at to be sure that the appropriation, dollar value, and past expenditures, and several other fields that been properly brought over from the legacy system so they could be accurately reported. And it took a long time to get that sorted out. And thats part of the reason why our annual general Obligation Bond report, which is part of your product as well, was an 18month report, running from january 2017 all the way to june 2018. That phase went on for a while. I think that is largely resolved. There are probably still always a few outstanding issues, but the underlying legacy data and expenditures brought over from that system i think now are reliable. Secondly, there is a timing issue, and i think that is probably more what the footnote in the current presentation refers to, where it usually takes at least a couple of quarters to make sure that all expenditures are all properly reported, allocated to the right project. The labor distribution that gets done by public works, again, allocated to the right project. Thats why we dont typically issue the caffer report until november on a fiscal year that closes june 30th. In this case, it is probably more the timing issue that by the time they generated this report, all of the entries for the quarter ending june 30th hadnt been completed. So, again, these numbers all get better with more time. But i wanted to remind people there are those two different issues that have affecting the reports. Chairman thank you, peg. From a very common sense kind of viewpoint, we would appreciate if you keep this committee updated. I think at some point we realize that the transition of the new system is mostly at fault. But i think that this committee would like, at some point, to be able to see this footnote removed. And please keep us updated as to the possible timing because i guess very nervous when i read financials with a disclaimer. Thank you. Thank you. Chairman any other questions, members . Thank you. Any Public Comment . Good morning, my name is Jerry Dratler. Regarding the Public Health and safety bond, i think the presentation change or format change to include the project sponsors is very positive. And i commend seago for calling out the lack of reliability in the data from the new financial system. One suggestion i would make is that seago meet with the c. F. A. Team, to determine if the scope of work, the work that has been done, addresses your concerns about data integrity. And if it doesnt, i would suggest that you ask for additional audit procedures to specifically address your concerns. Secondly, reporting Financial Data thats two quarters, or a half year old, with as many moving parts in this project is a pretty serious weakness that needs to be addressed. In terms of more general concerns nice report, many pretty production but not much bond expenditure oversight information. I thought seago determined all bond expenditure presentations should include detailed project change reporting. I dont see any project change reporting here. And change orders there are four different kinds of change orders. And change orders are a key indicator of a problem with a project. You dont need to wait until the end of the project to find out that you have significant cost overruns. When you look at the number, the type, and the frequency of change orders, thats a key barometer of where this thing is going. So addressing the types of change orders you know, when there is a change in scope, thats pretty serious. And the contractor needs to renegotiate the contract to get paid for it. And you need to know about it. Also, if there are unforeseen Building Condition change orders, you need to know about it. I think most importantly, the citizens of San Francisco, who approved this 350 million bond, need that information as well. So im disappointed. A lot of effort went into the report, but its you know, its pretty. Thank you. Chairwoman any Public Comment . Can you call the next item. Item number six, the liason report on the 2011 road repaving and Street Safety bond, and 2014 transportation and road improvement bond, and possible action by the committee in response to such presentation. Chairwoman ryan, i hate to put you on the spot. Im kind of look forg for presentation from the staff, or do you want the liason report. Chairwoman i think we want the liason report. All right. Thank you. I am the liason for the second of these two contracts, 2014 road improvement bond, assisted by brenda. We met with s. F. M. T. A. Staff o on the 7 financial o7th of thismonth, and we have a review of the report that is in your package. I will say generally theyre in their third bond issuance now. And in deference to some of the availability of contractors to do work now, the issue we heard about from the previous bond report, is affecting them, too. And what they, m. T. A. , are doing is trying to space out their bids, putting their contracts out to bid, so as to not be affected so adversely by the lack of available contractors. One of the problems of this nature manifested itself in the contract for the geary road improvements pardon me, the geary pedestrian improvements, and they got three bids, all of which were over the engineers estimate. They regarde regarded that contract as being so important to pedestrian safety, theyre going to go ahead and award it nonetheless. As a person who lives on geary and is of a certain age, im glad to hear theyre going to do anyway. There were several contracts that i wanted to ask questions about that i didnt get into the detail on until after i had read the report. But generally speaking, we heard that there be no pending major contractor claims on any of the work that theyre doing. Thats good. Some of the things that i read about in the detailed report here, the report that is in your package. Looked like they could be potential claims, but if they resolve the issues by the aforementioned by Jerry Dratler changeover process, then it isnt a claim. If you settle with a change order, its not a claim, and thats the best way to do it. In my previous question about the s. F. G. H. Bond, there was a lawsuit, and there was a lot of legal talent involved in that and by g something with a change ord, all of that is resolved. In this case, the city of San Francisco gets their project late, and the only benefit they get for paying for having it delivered late is a chance to look at a bunch of guys standing around leaning on shovels on the citys dime. Thats, to me, what is important to avoid, and thats what i follow up on most specifically, most ardently. It doesnt seem as though there are any bad ones coming up, though if the staffers were here, i would ask them a little more about a couple of contracts. Contract 64, in particular, where there is a rightofway issue at merapose and pennsylvania. At king street, substation work was suspended due to pg e issues. This kind of thing is on the citys lot. The city will be responsible for paying for those delays. It may have been caused by pg e in this instance, but the contractor wont know a thing about pg e. All the contractor knows is what the contract is with the city. So, again, i would like to find out what is going on there. Again, they, muni, are experiencing the same difficulties in getting bidders to respond to their request for bids and also getting reasonablypriced bids. There were fires up in sonoma county, and it was in all of the papers last year, and a lot of contractor work in particular is going up there. So getting contractors to work, and for those contractors to show up for work down here when they get more money up there is a continuing issue. One of the contracts in the report said this is on the 22 filmore east two mission bay expansion, and they need added funding to finish the contract, or ultimately will need to complete the contract. Thats a question on which i would like to follow up with them. Let me just check my notes that i had coming in here. I think thats it. Chairwoman questions . There are two different bond Program Managers, and im not sure if any of the ones you have questions about are the subject of the m. T. A. Bond, but i know mr. Lee from the m. T. A. Program is here. Sorry, public works. So let me back up a step and say, congratulations, mr. Lurkin, youre the first deliverer of a liason report in the format we talked about for this fiscal year. There has been a little bit of confusion about how to deliver this content, but i think our conversation, when we were developing the work plan with you for the current fiscal year, was that each bond program would appear before you twice in a year. Once you would have a formal report from the bond Program Managers of the type that was just given on the Public Health bond. In the opposite six month point and the calendar, you would have a liason report, like mr. Lurkin gave, and the advantage would be the forcing function of having the liason have an opportunity to anticipate that item, set up a meeting with bond Program Managers, ask any questions they had, so that the content could be focused on things that are of most of interest to goback. And there was a concern you would get detailed reports and pretty pictures, but not much of a chance to focus on issues that are of concern for you. The liason focus was a test. I should have also reminded the m. T. A. Program manager that having that Program Manager appear during the agenda item would be an expectation so that any questions could be answered. So sorry if that was my miss. But thats sort of my expectation for how it would go. Oh, sorry. I was going to say there is a familiarlooking guy over there. Chairwoman i dont know all of the personnel, so sorry about that. And before you go on, i was going to say, yeah, this is a misunderstanding, then, on my part that the new format was going to not include as much a presentation as we had had before. Ill say a misunderstanding to make it sound better than i just forgot. Chairwoman again, you can change it, it is certainly your purview. Our hope was we would have the opportunity for the liason to ask questions that are at the level of interest of the community. Sorry for my not knowing all of the folks here, but the bond Program Manager can and should be here for you. The thing i would have done differently is followed up with the staff before we came into this meeting. We did have this liason meeting, but that was some three weeks ago. I could have got these questions answered by going to the staff out of the venue that were having here. So what ill do then, if we cant get things answered if we cant get them answered today, is follow up later and at the next meeting, ill just give a report on that and it wouldnt take more than just a few minutes. We can put it under new business or whatever. Before youre there to answer some of the questions that were raised, i was also at the meeting with brian larkin, and i just wanted to supplement part of what we discussed. And my concerns going into the meeting, every time i meet with the m. T. A. , tends to be more on the Macro Financial level. So i just wanted to share what i discussed with staff, is that since i was keying in on the two presentations, the two tables, they have on page 13 and 14, which actually shows the projects and the funds under the first issuance. And on the page next to it, the second bond issuance. And my purpose, also, is to really probe staff. Im fairly comfortable to have them comment on the spend of the first issuance. It is pretty all gone. There is less than 2 million there. According to their plans, there is a timeline to spend it down. In the second issuance, they are almost half way there. And we had some discussion on their expectation and how happy they are proceeding with the spenddown because they are kind of really looking forward to a third issuance early next year. So that was the type of discussion i had, and i walked away very comfortable that they have a pretty good handle on how they control their spend because prior to the second issuance, there is some discussion and concerns as to the pace of the spend after the first issuance. So i think theyve addressed that, and i feel comfortable on the financial overall management. They seem to be on top of things. I just want to supplement them. Chairwoman thank you. Were not looking for a presentation today. In the interest of time, i would like to take brian up on his offer to address this between now and the next meeting. But thank you, guys, for doing this and for getting into the weeds on this one. Do any other members have any questions or comments . So the next liason report, are you expecting to have the bond manager have a presentation . Chairman yeah, its in the march timeframe. All right. But, again, you would have two different types of events for each bond program. One would be a formal presentation of the type that you saw for Public Health. Uhhuh. And one would be a lie yeas son report, with content of the type that came from mr. Larkin and ms. Mcnullty. You can have the bond Program Manager attend the meeting so they could answer any questions that came up or comment on your meeting, but not a formal presentation. So that formal presentation in is march, and it includes the second bond, the 2011road repaving. And if you look at this long sheet in our package, there is only 10 million unspent out of 250 million. Could i just have it on record, because the item actually calls for a liason report on that repaving bond. On a housekeeping issue, that there is currently no liason on that bond. Yes. Thats why there is no liason report. But i think that chair chu has indicated very clearly that this is essentially spent, and i think that its safe to forego a liason report really pending a closeout procedure for this bond. Chairman thats what i was getting at. Thank you. Good. Chairman any other comments . Just a question for peg. The format will allow us then, after my followup, to clear up or close out the items that i brought up at our next meeting . Chairman sure, we can add it to the next Committee Agenda meeting. It shen shouldnt take more than 10 minutes. Chairman thank you. Public comment . Good morning, my name is Jerry Dratler. I think the new presentation format is a very good idea. I suggest the second presentation format be more formalized with specific required content, like change order report, current budget versus original budget, expected variance from original budget, and a statement by the liason. I ask for your level of comfort whether the project will remain on budget. Thank you. Chairman thank you. Just so we have an agenda item that might be appropriate for mr. Dratlers comments later on. So this would be appropriate. Call the next item. Item seven, presentation from the city Service Auditor regarding the 2015 Affordable Housing bond expenditure audit report and possible action in response to such presentation. Good morning, chair, vice chair, Committee Members. Mark delarosa. Today we will give you a very quick overview of the results of our audit of the 2015 Affordable Housing bond. We specifically looked at the expenditures ensuring that the bond funds are actually expended per the bond measure. Im joined today by simon wattsworth from construction management, which sa firm that has been helping us in completing all of these expenditure audits. Very quickly, ill give you a background. We started this Audit Program back in 2015. In 2016 was the first time we actually completed one of the audits that we have before you. So far we have completed eight. The affordable bond one is the last one we issued back in july. As you know, this is a very focused audit. It is really a compliance audit to ensure that the bond funds that we reviewed were actually in compliance with the bond measure, and that there w