MINUTES OF REGULAR BOARD MEETING OF SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY MARCH 24, 2016

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1 MINUTES OF REGULAR BOARD MEETING OF SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY MARCH 24, 2016 The Regular Meeting Pennsylvania Transportation 24, 2016 at 3:00 PM, in the Chairman in the Chair. Present of the Board of the Southeastern Authority was held on Thursday, March Board Room of the Authority, with the Attending the meeting were the following Board members: Pasquale T. Deon, Sr., Chairman Thomas E. Babcock, Vice Chairman Beverly Coleman Robert D. Fox, Esquire Honorable Stewart J. Greenleaf Kevin L. Johnson, P.E. (via telephone) John I. Kane Daniel J. Kubik Kenneth E. Lawrence, Jr. William J. Leonard, Esquire Honorable Charles H. Martin William M. Mcswain, Esquire Clarena I.W. Tolson Honorable Michael A. Vereb Present from the staff: Jeffrey D. Knueppel, General Manager Richard G. Burnfield, Deputy General Manager/Treasurer Gino J. Benedetti, Esquire, General Counsel Stephen A. Jobs, Controller Carol R. Looby, Secretary Kim Scott Heinle, AGM - Customer Service Ronald Hopkins, AGM - Operations Francis E. Kelly, AGM - Government & Public Affairs Robert E. Lund, AGM - Engineering, Maintenance & Construction Susan Van Buren, AGM - Human Resources Mr. Deon called the Regular Meeting of the Board to order. Mr. Deon said the Special Meeting, which was noticed, was cancelled. He announced that Kevin Johnson would be participating by telephone. Mr. Johnson acknowledged his presence Pledge of Allegiance was observed.

2 Minutes of Regular Board Meeting March 24, 2016 Mr. Deon announced that the Board met in Executive Session just prior to the meeting to discuss legal matters. Mr. Deon stated that if there were speakers who wished to address agenda items they would be called before the Board voted on the item and asked that they limit their remarks to three minutes. He said speakers wishing to address i terns not on the agenda would be called after the regular business of the Board was completed. Approval of Minutes Chairman Deon entertained a Motion regarding the Minutes of the February 25th Regular and Annual and Special Board Meetings, which had been circulated. Mr. Kubik moved, Representative Vereb seconded, and the Minutes were unanimously approved. Financial Report Mr. Burnfield stated that regional ridership for the month of February was strong with ridership increasing three percent over last year. He reported that city transit ridership was slightly below budget, falling 1 percent from last year. Mr. Burnfield noted that passenger revenue was 800,000 under budget. He reported that expenses were under budget by 1.9 million due to fuel and labor expenses below budget. Mr. Burnfield reported that for surplus of 980,000 and year-to-date budget surplus of 217,000. the month, there was there was a an operating Chairman Deon entertained a Motion to adopt the Financial Report. Mr. Babcock moved, Ms. Coleman seconded and it was unanimously adopted. The February Financial Report is received and filed and is attached to these Minutes as Exhibit "A." Chairman Deon then called for speakers wishing to address agenda items. There was no response. Consent Calendar Chairman Deon consisted of: then presented the Consent Calendar, which "Award of Various Consulting Services Contracts Pursuant to Request for Proposals"; "Authorization to Execute Consultant Contract Amendments"; 2

3 Minutes of Regular Board Meeting March 24, 2016 "First Amendment to the Lease Agreement Between SEPTA and the Rothman Institute of an Additional 6,134 Rentable Square Feet on the 3~ Floor of 1234 Market Street;" "Grant by SEPTA to Villanova University of a Perpetual Easement for a Pedestrian Bridge Connection at the NHSL Chapel Avenue Station in Radnor Township, Delaware County;" "Tunnel Agreement, Concourse Realignment Agreement, Indemnity Agreement and First Amendment to the Amended and Restated Easement Agreement Between SEPTA and Various Entities;" "Lease Agreement by SEPTA to Quakertown Borough for Use of the Quakertown Freight House and a Portion of Surrounding Property on the Inactive Bethlehem Branch;" "Cooperation Agreement By and Between SEPTA and Which Will Govern Those Highway Projects that Affect Parties;" Penn DOT the Two "Authorization Procurements"; to Award Contracts for Various "Award of Various Contracts for Sole Source Procurements;" and "Authorization to Execute a Change Order." Mr. Deon stated that all Calendar were reviewed by the public session. of the items on the Consent appropriate Board Cornrni ttees in Mr. Deon entertained a Motion to adopt the Resolutions. Representative Vereb moved, Mr. Lawrence seconded and the following Resolutions were unanimously adopted, with Mr. Kubik abstaining on Item I I. B. 4. and Mr. Johnson abstaining on Item I.A.1. I.A. AWARD OF A CONSULTING SERVICES CONTRACT PURSUANT TO REQUEST FOR PROPOSALS "WHEREAS, SEPTA, which has need for the consulting services as described below, advertised and solicited proposals from firms wishing to propose; and WHEREAS, SEPTA staff requested that the General Manager recommend that the Board authorize SEPTA to award a contract to the firm identified below because the firm was the successful proposer in the area for which the request for proposals was issued; and 3

4 Minutes of Regular Board Meeting March 24, 2016 WHEREAS, the General Manager recommended that the Board authorize SEPTA to award the contract. NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to award and the General Manager or his designee to execute the following consultant contract in form approved by the Office of General Counsel, subject to the concurrence of the funding agencies, if required, and contingent upon and subject to the proposer satisfactorily meeting all requirements of the terms and conditions of the relevant request for proposals, including the provision of any required insurance certificates and full compliance with any applicable Disadvantaged Business Enterprise requirements: 1. To Jacobs Project Management Company, for a total contract amount not to exceed 8,000,000; to Michael Baker, Inc., for a total contract amount not to exceed 8,000,000; to WSP/Parsons Brinkerhoff, Inc., for a total contract amount not to exceed 8, 0 00, 000; and to Urban Engineers, Inc., for a total contract amount not to exceed 8, 000, 000, for the provision of GEC construction management services, including, but not limited to the development of inspection service work plan, inspection of work, management of contractor coordination meetings, management of progress meetings, submittal of contractor performance reports, verification of contractor quality control, tracking and monitoring of contractor submittals and monitoring of contractors' safety program and site safety, with services to be performed on an "as required" basis over a period of three years scheduled to commence in April 2016, as described in the staff summary on this subject, Request for Proposals No AAGO - GEC - Construction Management Services." I.B. AUTHORIZATION TO EXECUTE CONSULTANT CONTRACT AMENDMENTS "WHEREAS, additional work is required to complete the projects identified below; and WHEREAS, staff reviewed the additional work and the General Manager recommended that the Board authorize SEPTA to enter into the amendments for the additional work. NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to award and the General Manager or his designee to execute the consultant contract amendments identified below in form approved by the Off ice of General Counsel, subject to the concurrence of the funding agencies, if required, and to any applicable Disadvantaged Business Enterprise requirements: 1. To Delaware Valley Regional Planning Commission (DVRPC), for Amendment No. 2, which provides for a 17-month nocost time extension for the Travel Demand Modeling contract to support the planning efforts for the rail extension of the Norristown High Speed Line (NHSL) to King of Prussia, made 4

5 Minutes of Regular Board Meeting March 24, 2016 retroactive to December 31, 2015 and thereby establishing a new contract completion date of June 30, 2017, with the total contract price, including all amendments to date, remaining at an amount not to exceed 361, To AECOM, for Amendment No. 2, which provides for a 17- month time extension for the Norristown High Speed Line (NHSL) Extension Alternatives Analysis/Draft Environmental Impact Statement (AA/DEIS) contract, made retroactive to December 31, 2015 and hereby establishing a new contract completion date of June 30, 2017, at an increase in cost not to exceed 1,677,933, bringing the total contract price, including all amendments to date, to an amount not to exceed 5,074,537." II.A.l. FIRST AMENDMENT TO THE LEASE AGREEMENT BETWEEN SEPTA AND THE ROTHMAN INSTITUTE OF AN ADDITIONAL 6,134 RENTABLE SQUARE FEET ON THE 3RD FLOOR OF 1234 MARKET STREET "WHEREAS, on October 22, 2015, the Board authorized SEPTA to enter into a lease agreement ("Lease") with the Rothman Institute ("Rothman"), which specializes in orthopedic care, for approximately 10, 592 rentable square feet of space on the 3rd floor of 1234 Market Street, to be used exclusively for a combination of administrative offices and call center for insurance billing; and WHEREAS, the Flynn Company, SEPTA's contracted leasing broker for the 1234 Market Street Headquarters Building, has negotiated a proposed first amendment to the Lease ("First Amendment") with Rothman for an additional 6,134 rentable square feet of contiguous office space on the 3rd floor of 1234 Market Street ("Demised Premises"); and WHEREAS, the base term of the proposed First Amendment is nine years and seven months (or 115 months), to be coterminous with the original Lease term commencing upon SEPTA's fit-out of the space or July 1, 2016, whichever occurs later, along with a five-year renewal option at a rental rate equal to 100% of the then current fair market value (FMV); and WHEREAS, the annual base rental for the Demised Premises will be 131,881 (or per square foot) plus electric, with four months of free rent (to compensate Rothman for taking more space sooner than needed), and annual increases thereafter of 3, 067 (or. 50 per square foot) effective after the 20th month of the term and each succeeding year, resulting in rental revenues over the full term of the First Amendment totaling 1,330, in gross income (482, net income); and WHEREAS, said rental amount includes operating expenses and real estate taxes projected at 9.18 per square foot (or 56,310.12) for 2016, with Rothman being responsible for all 5

6 Minutes of Regular Board Meeting March 24, 2016 increases over the base year, as consumption estimated at 1.50 per annually) ; and well as monthly electric square foot (or 9,201 WHEREAS, Rothman will also receive a tenant improvement (TI) construction allowance of per square foot as part of their base rent; and WHEREAS, pursuant to SEPTA's broker-management contract with The Flynn Company, the proposed First Amendment will call for a 4% commission payment of 53, to be paid to Rothman' s exclusive real estate broker, Markeim Chalmers, Inc., and a 2% commission of 26, will be paid to the Flynn Company; and WHEREAS, staff requested that the General Manager recommend that the Board authorize SEPTA to enter into the proposed First Amendment with Rothman for the Demised Premises in 1234 Market Street under the terms set forth above and more fully described in the pertinent staff summary; and WHEREAS, Board. the General Manager made the recommendation to the NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to enter into the proposed First Amendment to the Lease Agreement with the Rothman Institute, for the Demised Premises, under the terms that are set forth within the pertinent staff summary. FURTHER RESOLVED, that the Board hereby authorizes the General Manager or his designee to execute all documents, in form approved by the Office of General Counsel, and to do any and all other things as shall be necessary and proper in order to effectuate the purpose of this Resolution." II.A.2. GRANT BY SEPTA TO VILLANOVA UNIVERSITY OF A PERPETUAL EASEMENT FOR A PEDESTRIAN BRIDGE CONNECTION AT THE NHSL CHAPEL AVENUE STATION IN RADNOR TOWNSHIP, DELAWARE COUNTY "WHEREAS, on February 25, 2016, in conjunction with Villanova's planned construction of a new ADA accessible bridge ("Bridge") over Lancaster Avenue which will connect to SEPTA' s Norristown High Speed Line (NHSL) existing pedestrian overpass at Chapel Station, the Board authorized that SEPTA grant to Villanova a temporary construction easement consisting of approximately 266 square feet of SEPTA-owned property; and WHEREAS, the said temporary construction easement was requested for a period of one year to provide access, construction, installation and reconstruction related to the placement of a 20 linear foot portion of SEPTA's existing pedestrian overpass; and 6

7 Minutes of Regular Board Meeting March 24, 2016 WHEREAS, Villanova has now requested that SEPTA grant to Villanova a non-exclusive perpetual easement for the portion of the Bridge located within the NHSL right-of-way, to install a horizontal beam that will span the new Bridge from Villanova' s column to the existing SEPTA column at the base of the SEPTA pedestrian overpass; and WHEREAS, Villanova will have the right, at its sole cost and expense, to construct, install, maintain, repair, alter, renew and remove the Bridge, and the proposed easement will encumber only the physical space and dimensions actually required and used for the Bridge, including the vertical air space directly below/above the horizontal beam, as well as 5.74 feet on one side of the Bridge and feet on the other side of the Bridge, for future maintenance; and WHEREAS, in addition to the foregoing, Villanova's right to construct and connect the new 20 foot section of SEPTA's pedestrian overpass into the existing infrastructure is subject to SEPTA's prior written discretionary approval (as to the means, methodology, materials and location), and Villanova's contractor having first entered into a right-of-entry permit with SEPTA; and WHEREAS, staff requested that the General Manager recommend that the Board authorize SEPTA to grant to Villanova the nonexclusive perpetual easement to connect SEPTA's pedestrian overpass/bridge into the existing infrastructure, for nominal consideration, under such terms and conditions set forth above and more fully described in the pertinent staff summary; and WHEREAS, Board. the General Manager made the recommendation to the NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to grant to Villanova University the proposed non-exclusive perpetual easement, under the terms and conditions set forth within the pertinent staff summary. FURTHER RESOLVED, that the Board hereby authorizes the General Manager or his designee to execute all documents, in form approved by the Office of General Counsel, and to do any and all other things as shall be deemed necessary and proper in order to effectuate the purpose of this Resolution." II.A.3. TUNNEL AGREEMENT, CONCOURSE REALIGNMENT AGREEMENT, INDEMNITY AGREEMENT AND FIRST AMENDMENT TO THE AMENDED AND RESTATED EASEMENT AGREEMENT BETWEEN SEPTA AND VARIOUS ENTITIES "WHEREAS, on July 26, 2001 the Board adopted a resolution which authorized SEPTA to enter into agreements with Liberty Property Philadelphia Limited Partnership IV East ("Liberty East") and Liberty Property Philadelphia Limited Partnership IV 7

8 Minutes of Regular Board Meeting March 24, 2016 West ("Liberty West"), which created various easements associated with, and governed issues that would arise during the construction of the proposed Comcast Center, and the connection of the concourses of SEPTA's Suburban Station ("Concourse") and the proposed Comcast Center; and WHEREAS, on March 22, 2007 the Board authorized SEPTA to enter into an amended and restated easement agreement ("2007 Easement Agreement") with Liberty/Commerz 1701 JFK Boulevard L.P. ("Liberty/Commerz") which was formerly Liberty East, Liberty West and PIDC/Development Management Corporation ("PIDC"), which created new easements and revised some of the existing easements due to the design changes of Comcast Center and its concourse; and WHEREAS, Comcast Corporation ("Comcast") is the successor to Liberty West, and Liberty/Comcast 1701 JFK Boulevard L.P. ("Liberty/Comcast") is the successor to Liberty/Commerz; and owns 1800 WHEREAS, Liberty Property 18th and the office unit (of 1800 Arch Street Arch Street, Philadelphia; and Arch, L.P. Condominium) ("Liberty") located at WHEREAS, Liberty and its affiliates currently intend to develop a mixed use office, hotel and retail complex on the Liberty property (at 1800 Arch Street) including a high rise building, public rest room and new pedestrian tunnel; and WHEREAS, when the pedestrian tunnel is constructed under 18th Street and the former bed of Cuthbert Street, a portion of the pedestrian tunnel will be located directly over SEPTA's Center City Commuter Tunnel ("Tunnel"); and WHEREAS, Comcast, Liberty/Comcast and PIDC, collectively, the Comcast Center Entities ("CCE"), Liberty and SEPTA have negotiated four separate agreements which will ( i) protect the Tunnel before/after construction of the pedestrian tunnel, and (ii) provide Liberty/Comcast and PIDC with an access easement to the Concourse and the Comcast Center through a portion of SEPTA's property, while assuring that SEPTA's emergency generator is operational and accessible to SEPTA personnel at all times; and WHEREAS, the terms of the four agreements accomplishing the forgoing purposes are summarized as follows: 1. Tunnel Agreement. Liberty will (i) grant SEPTA approval rights with respect to the construction plans for the pedestrian tunnel; (ii) reimburse SEPTA up to 16, 000 for on-site inspection costs incurred during construction; (iii) indemnify SEPTA for any damages caused to the Tunnel during the construction and after the pedestrian tunnel is completed; and (iv) maintain adequate liability insurance. 8

9 Minutes of Regular Board Meeting March 24, Indemnity Agreement. Liberty will indemnify SEPTA against any damage that may occur to the Tunnel after the pedestrian tunnel is completed for reasons attributable to Liberty's negligence, which shall be recorded. 3. Concourse Realignment Agreement. At such time that all conditions for construction of the pedestrian tunnel are in place, SEPTA will grant CCE a permanent and exclusive access easement ("Access Easement") through its transformer room in consideration for the appraised fair market value (FMV) of 41, 600, and Liberty (and/or its affiliates) will pay for all transfer taxes assessed on the granting of the Access Easement. 4. First Amendment to the 2007 Easement Agreement. SEPTA will grant the Access Easement to CCE by amending the existing 2007 Easement Agreement, which already contains standards for any construction in the Concourse, and CCE will in turn be responsible for maintaining and securing the area within the Access Easement. WHEREAS, in addition to the foregoing, CCE will relocate SEPTA' s emergency generator, at its sole expense, into another section of the transformer room (as well as provide for a temporary generator while said relocation takes place), and grant SEPTA an easement which will enable SEPTA personnel to have access to the generator directly from the corridor in the Concourse; and WHEREAS, SEPTA, if required, will obtain concurrence of the Federal Transit Administration (FTA); and WHEREAS, staff requested that the General Manager recommend that the Board authorize SEPTA to enter into the proposed Tunnel Agreement, Indemnity Agreement, Concourse Realignment Agreement and First Amendment to the 2007 Easement Agreement with CCE and Liberty as set forth above and more fully described in the pertinent staff summary; and WHEREAS, the General Manager made the recommendation. NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to enter into the proposed Tunnel Agreement, Indemnity Agreement, Concourse Realignment Agreement and First Amendment to Amended and Restated Easement Agreement with Comcast Center Entities and Liberty Property 18th and Arch, L. P. as set forth above and within the pertinent staff summary. FURTHER RESOLVED, that the Board hereby authorizes the General Manager or his designee to execute all documents, in form approved by the Office of General Counsel, and to do any and all 9

10 Minutes of Regular Board Meeting March 24, 2016 other things as shall be deemed necessary and proper in order to effectuate the purpose of this Resolution." II.A.4. LEASE AGREEMENT BY SEPTA TO QUAKERTOWN BOROUGH FOR USE OF THE QUAKERTOWN FREIGHT HOUSE AND A PORTION OF SURROUNDING PROPERTY ON THE INACTIVE BETHLEHEM BRANCH "WHEREAS, SEPTA's Quakertown freight house building ("Freight House") located along the inactive Bethlehem Branch in Richland Township, Bucks County, which was constructed in the late 1800's and is within the Quakertown Historic District which is listed in the National Register of Historic Places, is currently in a state of disrepair; and WHEREAS, Quakertown Borough ("Borough") has been in discussions with SEPTA with respect to entering into a lease agreement ("Lease") for the renewal, redevelopment and use of the Freight House, as well as a portion of SEPTA's surrounding property (collectively, "Demised Premises"), and in turn intends to enter into a sublease agreement with a developer; and WHEREAS, the Borough has proposed an initial base term for the Lease of ten years, along with five 5-year renewal options; and WHEREAS, the Freight House will be leased in "as is" condition, with the Borough agreeing to invest approximately 300,000 in capital contributions to pave portions of the parking lot ( s) and bringing electric, water and sewer utilities to the property, and the developer being required to invest approximately 1. 5 million for repairs and improvements in the Freight House; and WHEREAS, SEPTA conducted an independent fair market value (FMV) appraisal for the Demised Premises containing 67,953 square feet, resulting in an FMV of 9,900 annually, which the parties later mutually agreed to a reduced leasehold parcel of approximately 59,321 square feet and an adjusted annual rental of 8,400; and WHEREAS, SEPTA will receive minimum rental proceeds of 78,234,51 over the entire base term of the Lease, and maximum proceeds of 495, should the Borough exercise all five renewal options; and WHEREAS, SEPTA and the Borough have also agreed to a rental abatement period for the first two years of the Lease, with rental for years three through five being fixed at 8,592 annually (or 716 monthly), and rent escalations thereafter of 15% in year six and 3% annually for each of the remaining years under the base term of the Lease and any option periods; and 10

11 Minutes of Regular Board Meeting March 24, 2016 WHEREAS, the parties have further agreed that in the event there is a six-month vacancy in the occupancy of the Demised Premises upon conclusion of year five, then the Borough may terminate the Lease upon six months' prior notice to SEPTA; WHEREAS, Borough will be responsible for all maintenance and repairs to the Demised Premises, including ice and snow removal; and WHEREAS, if required, staff will also obtain concurrence of the Federal Transit Administrative (FTA); and WHERES, staff requested that the General Manager recommend that the Board authorize SEPTA to enter into the proposed Lease with the Borough for use of the Freight House and surrounding property under the terms and conditions set forth above and more fully described in the pertinent staff summary; and WHEREAS, Board. the General Manager mad the recommendation to the NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to enter into the proposed lease agreement by and between SEPTA and Quakertown Borough, with respect to the occupancy and use of the Demised Premises, under the terms and conditions that are set forth within the pertinent staff summary. FURTHER RESOLVE, that the Board hereby authorizes the General Manager or his designee to execute all documents, in form approved by the Office of General Counsel, and to do any and all other things as shall be deemed necessary and proper in order to effectuate the purpose of this Resolution." II.A.5. COOPERATION AGREEMENT BY AND BETWEEN SEPTA AND PENNDOT WHICH WILL GOVERN THOSE HIGHWAY PROJECTS THAT AFFECT THE TWO PARTIES "WHEREAS, the Commonweal th of Pennsylvania, Department of Transportation ("PennDOT"), is regularly engaged in maintenance, repair, reconstruction, and replacement projects that affect SEPTA's rail facilities and appurtenances that require SEPTA to provide PennDOT with engineering and/or construction support services; and WHEREAS, a cooperation agreement is a written understanding between SEPTA and PennDOT which defines terms, cost allocations, and other issues as to those highway projects that affect the two parties; and WHEREAS, on May 22, SEPTA and Penn DOT entered into their first cooperation agreement; and 11

12 Minutes of Regular Board Meeting March 24, 2016 WHEREAS, on March 6, 1997 SEPTA and PennDOT entered into their second cooperation agreement; and WHEREAS, on August 30, 2005 SEPTA and PennDOT entered into their third cooperation agreement, which expired on August 30, 2015; and WHEREAS, the parties have been in negotiations with each other for several months to finalize the terms of a proposed fourth cooperation agreement ("Cooperation Agreement"); and WHEREAS, under the proposed Cooperation Agreement the parties define terms and establish cost allocations, clearances, right-of-entry procedures, minimum insurance requirements, reimbursement procedures, a dispute resolution process and other matters; and WHEREAS, just as under the earlier cooperation agreements, the proposed Cooperation Agreement requires that whenever SEPTA or PennDOT plan to carry out a project which would affect the other's facilities, the parties must enter into a Project Agreement (defined in the proposed Cooperation Agreement) for the specific project using the Cooperation Agreement as the basis of the Project Agreement; and WHEREAS, the implementation of the proposed Cooperation Agreement would avoid time-consuming negotiations between SEPTA and PennDOT for each Project Agreement and would give SEPTA and PennDOT consistency and certainty about the allocation of costs on projects that affect both; and WHEREAS, the Cooperation Agreement has an initial base term of five years, and allows for automatic renewals of five consecutive one-year option terms unless either party gives to the other 90 days' written notice not to exercise a renewal term; and WHEREAS, the staff requested that the General Manager recommend that SEPTA enter into the proposed fourth Cooperation Agreement under such terms and conditions set forth above and more fully described in the pertinent staff summary; and WHEREAS, Board. the General Manager made the recommendation to the NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to enter into the fourth Cooperation Agreement with the Commonwealth of Pennsylvania, Department of Transportation, under such terms and conditions as set forth within the pertinent staff summary. FURTHER RESOLVED, that the General Manager or his designee documents, in form approved by the Board hereby authorizes the to execute and deliver all Office of General Counsel, and 12

13 Minutes of Regular Board Meeting March 24, 2016 to do any and all other things as shall be necessary and proper to effectuate this Resolution." II.B. AUTHORIZATION TO AWARD CONTRACTS FOR VARIOUS PROCUREMENTS "WHEREAS, SEPTA advertised and invited bids for the supplies identified below; and WHEREAS, the firms listed below were the lowest responsive and responsible bidders to the invitation for bids; and WHEREAS, staff requested that the General Manager recommend that the Board authorize SEPTA to award the contracts identified below; and WHEREAS, Board. the General Manager made the recommendation to the NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to award and for the General Manager or his designee to execute the contracts identified below in form approved by the Office of General Counsel, subject to and contingent upon the concurrence of the funding agencies, if required, and contingent upon and subject to the vendors satisfactorily meeting all requirements of the bid terms and specifications, including full compliance with any applicable Disadvantaged Business Enterprise requirements: 1. To Progress Rail Services Corporation, for Items Nos. 1-5, for the purchase of specialty rail components to be used in renewal projects between West Interlocking and Arsenal Interlocking on SEPTA' s Regional Rail Lines, with deli very of material scheduled to commence 32 weeks after issuance of purchase order, as described in the staff summary on this subject, for a total contract amount not to exceed 1, 291, 775, Sealed Bid No ACZC - West to Arsenal Special Trackwork. 2. To Pandrol USA, LP, for Items Nos. 1-4, for the purchase of track rail clips and tie plates to be used for renewal projects in Fiscal Year 2017, with delivery of material scheduled on June 30, 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 503,250, Sealed Bid No ALSP - Rail Clips and Tie Plates. 3. To TK Keystone Construction Co., Inc., for the provision of landscaping and groundskeeping services at various SEPTA locations, with services to be performed over a period of nine months scheduled to commence on April 1, 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 103,456.98, Sealed Bid No ADLD Landscaping and Groundskeeping at Various SEPTA Locations. 13

14 Minutes of Regular Board Meeting March 24, To Road-Con, Inc., for general construction services to provide all labor, materials, tools and equipment for the Villanova Station Improvements Project Phase 1, with services to be performed over a period of 550 calendar days after issuance of Notice-to-Proceed, as described in the staff summary on this subject, for a total contract amount not to exceed 12, 82 4, 000, Sealed Bid No ATMM Villanova Station Improvement Project Phase To Tennant Sales & Service Company, for the purchase of 31 floor scrubbers and sweepers to replace an aging fleet of floor cleaning machines utilized throughout the Authority, with delivery of material scheduled in May 2016, as described in the staff summary on this subject, which is pursuant to a competitively bid state procurement contract, for a total contract amount not to exceed 772, " II.C. AWARD OF VARIOUS CONTRACTS FOR SOLE SOURCE PROCUREMENTS "WHEREAS, SEPTA has need for the described below and those supplies and only from the firms listed below; and supplies and services services are available WHEREAS, staff reviewed the cost of the supplies and services and the General Manager recommended that the Board authorize SEPTA to award the contracts. NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to award and the General Manager or his designee to execute the contracts identified below, all in form approved by the Office of General Counsel, subject to the concurrence of the funding agencies, if required, and contingent upon and subject to each vendor I contractor satisfactorily providing any required bonds, insurance certificates and/or other documents, and complying with any applicable Disadvantaged Business Enterprise requirements: 1. To Westcode, Incorporated, for the purchase of various replacement parts for the leveling valves, tread brake systems and HVAC components to be used on the Silverliner IV, V, M-4 and LRV car fleets, with delivery material on an "as required" basis over a period of three years commencing in April 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 598, To Wabtec Passenger Transit Division, Westinghouse Air Brake Technology Corporation, for the purchase of various brake parts to be used in the maintenance of the Silverliner V car fleet, with delivery of material not required as it is already on site, but transfer of ownership taking place in April 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 112,

15 Minutes of Regular Board Meeting March 24, To Gardner Denver Water Jetting Systems, Inc., for the purchase of various replacement parts to be used on SEPTA's gel train which removes leaves and resins accumulated on tracks during slippery rail season, with delivery of material on an "as required" basis over a period of three years commencing in May 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 117, To Di versified Metal Fabricators, Inc., for the purchase of replacement parts and gear assemblies to be used on SEPTA's hi-rail and utility vehicles, with delivery of material scheduled over a period of 36 months commencing in April 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 98, To Amazon Web Services, Inc., for the continued provision of web hosting services in support of IT systems currently in production and to further advance SEPTA's web infrastructure development to meet the uptime demand adopted in the Strategic Business Plan, with services to be performed over a period of three years scheduled to commence on April 1, 2016, as described in the staff summary on this subject, for a total contract amount not to exceed 150,000." II.D. AUTHORIZATION TO EXECUTE A CHANGE ORDER "WHEREAS, additional work is required to complete the projects identified below; and WHEREAS, staff reviewed the cost of the additional work and the General Manager recommended that the Board authorize SEPTA to order the additional work. NOW, THEREFORE, BE IT RESOLVED, that the Board hereby authorizes SEPTA to award and the General Manager or his designee to execute the change order identified below in form approved by the Office of General Counsel, subject to the concurrence of the funding agencies, if required, and to any applicable Disadvantaged Business Enterprise requirements: 1. To Carr & Duff, Inc., for Change Order No. 1, which provides for additional construction-related work on the 69th Street West Terminal Rehabilitation Project, at an increase in cost not to exceed 158,411, bringing the total contract price, including this change order, to an amount not to exceed 1,070,411, provided that with the Board's approval of this change order, the Board authorizes the resetting of prior authorized cumulative change order amounts to zero dollars ( 0) and the establishment of a new cumulative change order threshold of 10% or 500, 000, pursuant to the Resolution adopted by the Board on May 22, 2008, which Resolution authorized a "Delegation of Authority for Change Orders, Amendments and Agreements"." 15

16 Minutes of Regular Board Meeting March 24, 2016 Speakers Mr. Deon then called for speakers. Meena Raval Ms. Raval introduced herself and said she was a Philadelphia resident and an occasional SEPTA rider. She explained that she owns a bike store in Mount Airy and she encourages multi-modal transportation, all in an attempt to get people out of their vehicles. Ms. Raval stated that she was a member of 360 Philly, the local chapter of the international group 350.org. She explained that this group was based on their planetary goal of reducing carbon dioxide from over 400 cars per million reduced to 350 cars per million. Ms. Raval stated that she learned in October of 2015 that SEPTA proposed a Midvale gas power plant to power six regional rail lines traveling through a local junction. She learned of the proposal published in an article in PlanPhilly, "SEPTA Announces Public-Private Partnership for Energy Retrofits". She stated that the title sounded innocuous, a public-private partnership for energy efficient retrofits. Ms. Raval said that upon reading the article, she learned of the build-out of a natural gas infrastructure. She commented that this project would likely increase SEPTA's contribution to climate change rather than reducing it. She said that she knows that SEPTA feels that gas was cleaner burning than coal, except that most people do not take into account that methane was worse than carbon dioxide when it comes to global warming, or that drilling and transporting natural gas results in methane leaks, which were not typically factored into emission scenarios. Ms. Raval stated that the project would affect local air quality and the pollution would add to the smog in a neighborhood already burdened with pollution from the SEPTA bus depot, rail yard, freight line, the Roosevelt Expressway and the steel recycling facility. She noted Nicetown was one of the poorest neighborhoods in the City, which has one of the highest rates of children with asthma. Mr. Raval stated that she feels that this gas power plant would be a bad investment for SEPTA, because it would lock SEPTA into using natural gas for 20 years. She stated that by entering into this contract could mean betting against effective climate policies. Mr. Raval closed by requesting SEPTA to take a position to keep fossil fuels in the ground and to instead invest in efficiency, conservation and clean renewables like wind and 16

17 Minutes of Regular Board Meeting March 24, 2016 solar. She stated that this was something that they could support wholeheartedly. Chairman Deon thanked Ms. Raval and then called for the next speaker, Robin Davis. Robin Davis Ms. Davis introduced herself and stated that she has been a consumer advocate for over 25 years. She stated that at the next meeting she would answer the climate change denials and so-called supporters. Ms. Davis said she was present at the meeting on behalf of the workers that have been complaining that they do not have sufficient time for lunch and to use the bathroom facility. She stated that these workers were also complaining that they have been treated in a hostile manner by their supervisors. Ms. Davis said that some of the workers feel that they will be replaced by robotic technology. Ms. Davis said the other reason why she was present was to discuss security. She inquired about the SEPTA security plan for ISIS. She spoke about the recent terror attack in Brussels and said that we were dealing with an ideology and guerrilla warfare. Ms. Davis also spoke about the EPA, solar panels and the environment. Chairman Deon thanked Ms. Davis. He then requested Jeff Knueppel to present his report. Report of General Manager Mr. Knueppel stated that the Pennsylvania Horticultural Society experienced a record-breaking attendance at their 2016 Flower Show with 255,000 attendees. He stated that SEPTA welcomed many of these visitors to our regional rail service and Jefferson Station during a week marked by unusually warm weather. Mr. Knueppel said the flower show was always a sign that spring is on the way as was our participation in the annual City Spring Clean-up scheduled to take place on Saturday, April 9th. He noted that before the Authority's volunteer teams were sent out to spruce up the communities around the transit facilities, the Authority would host 24 senior managers from 8 peer agencies across the United States and Canada, including three members of the SEPTA team, who has been participating in the Leadership Exchange and Development (LEAD) Program. Mr. Knueppel then requested that the Chairman introduce the Transportation Security Administration (TSA) who had a presentation for the Authority. 17

18 Minutes of Regular Board Meeting March 24, 2016 Chairman Deon stated that he was pleased to announce that SEPTA was being recognized by the Transportation Security Administration with a Gold Standard Award for Homeland Security. He explained that the TSA conducts an annual, voluntary security assessment of rail and bus systems through their Baseline Assessment for Security Enhancements (BASE) Program. Chairman Deon said the system-wide security management program of each participating transit property was evaluated against 17 security and emergency preparedness action i terns, and the Gold Standard designation was only awarded to those systems that scored in the top 10 percent of all transit agencies reviewed. Chairman Deon said he was very proud to say that this was the second time the TSA awarded the Authority the Gold Standard designation. He stated this honor was a testament to the unyielding efforts of our Transit Police Department, the System Safety and Operations staffs, and all the SEPTA employees who were committed to safeguarding customers and the transit system. Mr. De re ck Starks, Director for the TSA in Philadelphia, thanked the Board Chairman, the Board and the SEPTA Police for in vi ting them to the Board meeting. He stated that it was an honor and a pleasure for them to present the award. Mr. Starks then introduced Jerry Farrell, Assistant Federal Security Director of Compliance, Regulatory and Inspections, Mike Calabrese, Regional Field Canine Coordinator, and Scott Powell, Transportation Security Inspector for Surface. Mr. Starks stated that SEPTA earned the TSA's highest rating of gold standard for its dedication to build a strong security program. He then requested Mr. Christopher McKay, from TSA headquarters in Washington, DC to present the award. Mr. McKay stated that they were present on behalf of the TSA Administrator, Peter Neffenger, to present and recognize SEPTA for its achievement in the Baseline Assessment Security Enhancement Program. He remarked that the Authority scored 96 percent for the FY'15 Baseline Program and it was the second time that the Authority achieved this level of excellence for this program. Mr. McKay explained that SEPTA was one of 13 agencies in Fiscal Year 2015 to achieve this highest level of excellence in security. He then presented the award. Chairman Deon thanked the TSA for attending and presenting the award. He also thanked the police and the employees that keep the SEPTA system safe. Adjournment There being no further business to come before the Board at this Regular Meeting, it was moved by Mr. Kane seconded by Mr. Kubik, and unanimously adopted that the meeting be adjourned at 3:15 PM. 18

19 Minutes of Regular Board Meeting March 24, 2016 A transcript of this meeting was made by an official court reporter and is made a part of the original Minutes. Carol R. Looby Secretary 19

20 SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY FINANCIAL REPORT FEBRUARY 2016 For Period Ended February 20, 2016 March 8, 2016 H t;d H >-3 ~

21 FINANCIAL REPORT - FEBRUARY 2016 COMMENTARY Summary of Financial Results and Commentary GROUP 1 -CONSOLIDATED OPERATIONS (1.1) Consolidating Statement of Income - (YTD) (1.2) Consolidating Statement of Revenue and Expense - (YTD) (1.3) Consolidating Statement of Income - (One Month) (1.4) Consolidating Statement of Revenue and Expense - (One Month) GROUP 2 - CITY TRANSIT DIVISION (2.1) Comparative Statement of Income (2.2) Detail Income Statement - (One Month) (2.3) Detail Income Statement - (YTD) GROUP 3 - VICTORY DIVISION (3.1) Comparative Statement of Income (3.2) Detail Income Statement - (One Month) (3.3) Detail Income Statement - (YTD) GROUP 4 - FRONTIER DIVISION (4.1) Comparative Statement of Income (4.2) Detail Income Statement - (One Month) (4.3) Detail Income Statement - (YTD) GROUP 5 - REGIONAL RAIL DIVISION (5.1) Comparative Statement of Income (5.2) Detail Income Statement - (One Month) (5.3) Detail Income Statement - (YTD)

22 FINANCIAL REPORT - FEBRUARY 2016 COMMENTARY Summary of Financial Results and Commentary

23 SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY FEBRUARY AND YEAR-TO-DATE RESULTS OF OPERATIONS SUMMARY The following is a summary of Divisional operating results (i.e. deficit before operating subsidies) and consolidated results after subsidies for February 2016 and the eight-month period then ended. The results are compared to the Fiscal Year 2016 budget and to the prior year results in the accompanying financial statements. (IN THOUSANDS) EIGHT MONTHS DIVISION MONTH OF FEBRUARY ENDED FEBRUARY City Transit (44,582) (41,917) (369,921) (358,805) Victory (5, 148) (5,437) (45,892) (44,988) Frontier (1,505) (1,957) (15,855) (16,726) Regional Rail (15,844} (13,590) (105,440) (96,759) Total Deficit Before Subsidies (67,079) (62,901) (537,108) (517,278) Operating Subsidies 68,059 63, , ,893 Surplus/(Deficit) After Subsidies Unrealized Investment Gain/(Loss) Surplus/(Deficit) after Investment Gain/(Loss) 1, ,471 The surplus after subsidies for the month of February was 980 thousand and the cumulative surplus for the eight months was 217 thousand. Passenger revenue for the month was 832 thousand (or 2.2%) worse than budget. Passenger revenue for the eight months of Fiscal 2016 was 6.6 million (or 2.1 %) worse than budget. Shared Ride Program revenue was 2 thousand worse than budget for the month of February and was 91 thousand (or 0.8%) worse than budget for February year-to-date. Operating expenses for the month of February were 1.9 million better than budget. For the eight-month period, operating expenses were 6.8 million (or 0.8%) better than budget

24 SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY FEBRUARY AND YEAR-TO-DATE RESULTS OF OPERATIONS DIVISIONAL COMMENTARY ON FEBRUARY AND YEAR-TO-DATE RESULTS CITY TRANSIT DIVISION The Division's operations for February 2016 resulted in a deficit before subsidies of 44.6 million for the month and a year-to-date deficit before subsidies of million, which is 1.7% worse than budget. Passenger revenue for the month of February was 635 thousand (or 2.7%) worse than budget. For the eight months of Fiscal 2016 total passenger revenue was 5.8 million (or 3.1 %) worse than budget. Shared Ride Program revenue for February year-to-date was 91 thousand (or 0.8%) worse than budget. Operating expenses for the eightmonth period were worse than budget. For the first eight months of the fiscal year, the operating surplus after subsidies was 160 thousand. VICTORY DIVISION The Division's operations for February resulted in a deficit before subsidies of 5.1 million bringing the cumulative deficit before subsidies for the eight months of the fiscal year to 45.9 million, which is 5.2% better than budget. Passenger revenue for February was 119 thousand (or 6.6%) worse than budget and for the eight months of Fiscal 2016 was 502 thousand (or 3.3%) worse than budget. Operating expenses for the eight-month period were better than budget. For the first eight months of the fiscal year, the operating surplus after subsidies was 21 thousand

25 SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY FEBRUARY AND YEAR-TO-DATE RESULTS OF OPERATIONS FRONTIER DIVISION Operations for the month of February resulted in a deficit before subsidies of 1.5 million bringing the cumulative deficit before subsidies for the eight months of the fiscal year to 15.9 million, which is 9. 7% better than budget. Passenger revenue for February was 35 thousand (or 6.8%) better than budget and for the eight months of Fiscal 2016 was 18 thousand (or 0.4%) worse than budget. Operating expenses for the eight-month period were better than budget. For the first eight months of the fiscal year, the operating surplus after subsidies was 7 thousand. REGIONAL RAIL DIVISION Operations for the month of February resulted in a deficit before subsidies of 15.8 million bringing the cumulative deficit before subsidies for the eight-month period to million, which is 2.1 % better than budget. February passenger revenue was 113 thousand (or 0.9%) worse than budget and year-to-date passenger revenue was 245 thousand (or 0.3%) worse than budget. Operating expenses for the eight-month period were better than budget. For the first eight months of the fiscal year, the operating surplus after subsidies was 29 thousand

26 FINANCIAL REPORT - FEBRUARY 2016 GROUP 1 -CONSOLIDATED OPERATIONS (1.1) Consolidating Statement of Income - (YTD) (1.2) Consolidating Statement of Revenue and Expense - (YTD) (1.3) Consolidating Statement of Income - (One Month) (1.4) Consolidating Statement of Revenue and Expense - (One Month)

27 SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY CONSOLIDATING STATEMENT OF INCOME EIGHT MONTHS ENDED FEBRUARY 20, 2016 (THOUSANDS) CITY REGIONAL TRANSIT VICTORY FRONTIER RAIL TOTAL DIVISION DIVISION DIVISION DIVISION SEPTA BUDGET VARIANCE BUDGET AMOUNT AMOUNT PERCENT OPERATING REVENUES Passenger Revenue Other Operating Revenue 184,201 14,694 4,341 99, ,662 13,638 1, ,927 23, ,220 (6,558) (2.12) 23, Sub-Total - Operating Revenue Shared Ride Program 197,839 16,087 4, , ,094 11, , ,586 (6,492) (1.95) 12,062 (91) (0.75) TOTAL REVENUE AVAILABLE FOR OPERATIONS OPERATING EXPENSES 209,810 16,087 4, , , ,731 61,979 20, , , ,648 (6,583) (1.91) 881,999 6, DEFICIT BEFORE SUBSIDIES OPERATING SUBSIDIES SURPLUS AFTER SUBSIDIES Unrealized Investment Gain/(Loss) SURPLUS AFTER INVESTMENT GAIN/ILOSSl (369,921) (45,892) (15,855) (105,440) (537,108) 370,081 45,913 15, , , (537,351) ,351 (26) (0.00) Page 1.1 3/8/16

28 SOUTHEASTERN PENNSYLVANIA TRANSPORTATION AUTHORITY CONSOLIDATING STATEMENT OF REVENUES AND EXPENSES EIGHT MONTHS ENDED FEBRUARY 20, 2016 (THOUSANDS) CITY TRANSIT VICTORY FRONTIER REGIONAL RAIL DIVISION DIVISION DIVISION DIVISION TOTAL SEPTA OPERATING REVENUES BUDGET ACTUAL BUDGET ACTUAL BUDGET ACTUAL ACTUAL BUDGET ACTUAL Passenger Revenue 189, ,201 15, ,694 4,359 4,341 99,671 99, , ,662 Shared Ride Program 12,062 11, ,062 11,971 Investment Income Other Income 12,402 13, 178 1,294 1, ,392 7,613 22,544 g_631 TOTAL OPERATING REVENUE 214, ,810 16,507 16,087 4,823 4, , , ,648 E!065 OPERATING EXPENSES Labor, including Paid Absences 263, ,409 29,155 28,751 11,624 11,439 83,189 85, , ,736 Fringe Benefits 174, ,793 18,175 15,372 6,363 4,769 51,739 46, , ,660 Material & Services 84,344 93,690 12,412 12,415 1,904 2,162 62,472 62, , ,390 Injuries & Damages 16,839 16,839 1,431 1, ,742 1,742 20,407 20,407 Propulsion Power 10,060 9, ,455 12,534 23,453 22,570 Fixed Rent 1,817 2, ,411 2,817 Fuel 18,708 17,253 2,592 2,944 2,038 1, ,804 22,359 Depreciation 8,422 8, ,576 3,577 12, ,234 TOTAL OPERATING EXPENSES 578, ,731 64,935 61,979 22,386 20, , , ,999 ~173 DEFICIT BEFORE SUBSIDIES (363,612) (369,921) (48,428) (45,892) (17,563) (15,855) (107,748) (105,440) (537,351) (537, 108) OPERATING SUBSIDIES Federal 17,243 17,561 2,370 2, ,382 3,271 23,835 23,835 State 284, ,416 39,965 37,885 14,157 12,753 57,022 55, , , 191 Local 42,607 43,412 5,995 5,683 2,124 1,913 8,553 8,271 59,279 59,279 Lease Cost/Debt Service 18,835 18, ,959 37,957 56,919 56,919 Other-Route Guarantees ,127 2,101 TOTAL SUBSIDIES 363, ,081 48,428 45,913 17,563 15, , , , ,325 SURPLUS AFTER SUBSIDIES p Unrealized Investment Gain/(Loss) SURPLUS AFTER INVESTMENT GAIN/(LOSS) ! 818 Page 1.2 3/8/16