Welcome to the environment committee meeting of May twenty-first, twenty twenty-six.

Our committee liaison, Natalie Kessler will provide information and instruction for the public to participate in today's meeting.

Natalie, please proceed.

Thank you, Chair.

Well, members of the public are able to attend the meetings in person.

This meeting is being televised and live streamed on the city's website.

Members of the public who wish to provide testimony via a call in or an internet-based service option must enter the virtual speaking queue within five minutes after the conclusion of in-person public testimony or before the virtual speaking queue is exhausted, whichever occurs first.

This will allow for better meeting management between the two platforms and ensure the committee is able to manage and conduct city business.

We appreciate the public's cooperation.

Also attending the meeting today is City Attorney Representative Nicole Dino.

If you're in person, please complete a speaker slip located at the entrance of the committee room and place it in the speakers slip box at the table in front of the room.

Please do so in a timely manner to ensure proper meeting management.

Members of the public can join the webinar by computer, tablet, or smartphone by accessing accessing the link listed online in the preamble language of the agenda on the city's webpage to join the Zoom webinar by phone, please dial 1669, 2545252.

When prompted, input webinar ID one six zero seven three two nine six three eight pound.

This information is also available on the agenda and will appear on the screen during the public comment period for each agenda item.

Please note that if you're watching via City TV 24 or online, there may be a delay.

So please participate the via the audio on your phone and meet your TV or computer when it is your turn to speak.

If you wish to speak on a particular item, wait for that item to be called and then raise your hand to speak by tapping the raise your hand icon, or if you're a call and participant, press star nine on your phone.

If you raise your hand during a non-comment period, your hand will be lowered.

Chair.

All right, thank you, Natalie.

We have a quorum.

Um as a note, we will be hearing uh our agenda uh excuse me.

We're hearing our agenda out of order uh after taking our consent items, which are items one through five.

We'll hear item number seven, followed by item number six, and then item number eight.

Uh but first we've got non-agenda public comment.

Um, Natalie, if you'd please proceed with that.

Per Rule 2.7, non-agenda public comment is an opportunity for members of the public to comment on items that are not on the agenda but within the subject matter jurisdiction of the committee.

Each speaker will have two minutes, and we have not received any speaker slips in the committee room for non-agenda public comments.

We will move to the virtual queue.

We have three hands raised in the virtual queue, and I've started the five-minute timer.

Blair Beakman, please unmute and provide your non-agenda public comment.

Hi, we're speaking first.

How do you do?

Happy Thursday to everyone.

I'm sitting over on uh 5th and B streets right now, um, or C Street actually, at the trolley.

Uh I'll be at the meeting soon.

Um, walking over there now.

Um thank you that council person Yellow Rivera is back.

Um, I really needed him here the past couple days, and uh I'm sorry he wasn't here.

I'm sorry, Councilperson von Wilford hasn't been around either.

It'll be nice to hear their voice uh just as part of our process at this time.

Uh, thank you.

Uh, congratulations that you're working on uh parking and uh garbage issues.

Um, well, thank you, I guess, uh, can be more in order, and um good luck what we're working on.

Um, in a lot of events have happened in San Diego this week, and uh I've been learning terms that as uh these young people who have committed these uh horrific crimes uh this past week.

There's this there's a concept called acceleration that they that they want action and change to happen and accelerate it.

And I'm trying to trust that as for as hideous as they're what they've done.

They can also have a part, you know, and they want they want you know uh some sort of radical change through racial protest.

Um they also have a part of them that can respect just uh a coming together that happens from such horrific events, and that's why I think their logic is really mixed up and backwards.

They don't simply want to trust how to work together cooperatively, but they want to create you know shock and chaos in order to get there.

And I think as we're learning that that is the wrong way to go.

And I think our young people are learning that more and more, and we really have to teach that that mass killing to solve create social change is not a very good answer.

And we'll we're working together as a community right now.

Good luck how we talk with each other, bring together uh our different religious communities in San Diego in different ways.

Thank you.

Thank you.

Our next speaker is phone number ending in seven two three four.

Please press star six to unmute and begin.

Good afternoon, environment committee chair Elo Rivera.

Excuse me.

My name is Terry Ann Skelly.

I'm a parent, a public health educator, and a planning group attendee.

Like many health uh public health educators, I found uh a recent uh US Surgeon General report entitled, and I quote Eliminating Tobacco Related Disease and Death Addressing Disparities.

I found it very timely because it addresses a higher toll on less advantaged people that smoking and vaping creates as secondhand smoke and vapor are inhaled, and a second hand smoke and vapor blows and seeps into our personal and public places where we play and entertain.

The World Health Organization recently stated that tobacco is poisoning our world.

World Health Organization reminds us that tobacco and marijuana products also impact the environment.

The toxic waste, which poisons our streams, oceans, and marine life, and contaminates our beaches and our waterways.

Summertime 2026 would be the best time for our city to consider an emergency ban on marijuana and tobacco smoking and vaping in public spaces.

Every uh resident benefits, and less advantaged residents benefit the most from cleaner air and cleaner environments.

Thank you for hearing my concerns today.

Thank you.

Our next speaker is Becky Rapp.

Please unmute and begin.

Good afternoon.

My name is Becky Rapp, and I'd like to bring to your attention a concerning matter protecting residents in multifamily housing from involuntary exposure to tobacco and marijuana smoke.

For many families living in apartments and affordable housing, secondhand smoke is not a choice that they can avoid.

And their health and quality of life can be deeply impacted.

Recently, the land development code was updated and approved.

And I come to a secondhand smoking concern be prioritized now so staff can begin evaluating and preparing recommendations for inclusion in next year's development code update cycle.

I'd specifically ask that this city explore language requiring that any housing project, public or private, receiving public subsidies, include a smoke-free policy.

Your priorities do include advancing environmental justice, reducing health disparities, improving housing quality, and protecting vulnerable residents.

Smoke-free affordable housing directly supports each of these goals.

So when public dollars are used to create or preserve affordable homes, we have a responsibility to ensure that those homes meet basic environmental health standards.

Smoke-free policies reduce second-hand smoke exposure and improve indoor air quality, lower fire risk, decrease long-term maintenance costs, and help create healthier living environments for families, seniors, children, and individuals with chronic health conditions.

So this is also an equity issue.

Residents in multi-unit affordable housing often have little ability to avoid exposure when smoke travels between units through vents, hallways, windows, and shared spaces.

No one should lose the right to clean air simply because they live in an attached housing complex.

Thank you for your time.

Thank you.

The five-minute timer concluded.

We have three hands remaining in the queue.

We will take no additional callers after these three.

Phone number ending in 870.

Please press star six and begin your comments.

First, my condolences to you, Chair Ido Rivera, your family, and all others involved in this week's tragedy.

The following is my opinion.

This week a crime was committed in our beautiful city.

Chief Wall called it, called it a hate crime unless proven otherwise.

I want to talk about the unless proven otherwise.

To try and understand that hate, I spent time researching hate.

It's very complex.

Again, I hate crime unless proven otherwise.

Two young men, 17 and 19, appeared to have taken their own lives along with three others.

Why?

I want to learn and understand their two stories.

The big question for me is this.

Can I come from a place of love?

And where is that place inside of me?

If I choose love, then can I learn to understand?

And then can I accept and live the miracle of life itself?

I'm working with this right now.

I'm struggling with it.

I thank you for listening.

Love to all and have a beautiful day.

Thank you.

Our next speaker is Judy String.

Please unmute and begin.

Good afternoon, environment committee.

Thank you for the previous words of the speakers regarding the unfortunate incident on Monday.

Uh I had a different talk in mind, but I'm a person who works every day with teenagers.

I have a slew of my own grandchildren, and now I'm a great-grandmother.

And I watch how easily our young people are influenced by social media, as is being reported in this last incident.

But what they see and watch in the environment around us.

Uh about 40 years ago they sort of term they came up with the term environmental prevention.

It had to do with alcohol, tobacco, marijuana, and drugs, and the messages in the environment that are sent out to young people and how quickly they absorb them.

They are visual learners when you're a teenager.

And they are just looking to understand what it is the adult culture thinks is important and what will make them wiser, more influential, wealthy, successful, and the messages they get confuse them because they don't have much wide range of experience to base them upon.

That's why I often speak to this group about the concerns I have about what the city says to them about the way we use alcohol tobacco, marijuana that somehow we need to use them to solve our problems.

And we know we all know from our personal experiences, it doesn't work that way.

So I just bring this to your attention as the environmental committee.

And thank you for your service.

Truly environment and the world around us, especially as it affects teens, is important.

Thank you.

And our final speaker in the queue is Madison.

Please unmute and begin.

Hi, good afternoon, Environment Committee.

I'd like to highlight an issue that applies to both nicotine and marijuana products, which is the environmental and hazardous waste of smoking and vaping.

Vapes are hazardous waste.

They contain lithium batteries that can spark fires in parks and trash systems.

They contain nicotine, THC, and other chemicals that can leach into our soil and waterways.

And because they are made of mixed materials, plastic, metal, electronics, they are extremely difficult to break down or recycle.

And the volume of this waste is growing.

Our schools are on the front lines of this problem.

Every day administrators confiscate vape devices from students.

Sometimes they're storing hundreds at a time, storing them in boxes without clear guidance on how to do that.

That creates risks of fire hazards, chemical exposure, and liability.

Schools are being asked to manage hazardous waste without standardized protocols, without proper storage systems, and without any support.

There's also an opportunity here because many young people today can care deeply about the environment.

When they understand that vaping contributes to pollution, fire risk and toxic waste, it changes the conversation to become not a health issue, but also an environmental one.

And that connection can increase their awareness and engagement.

As a city, we can support clear citywide and regional protocols for safe disposal of vape products.

We can explore partnerships with hazardous waste and recycling providers.

And most importantly, we can invest in prevention, especially in upper elementary and middle school, focusing on decision making, long-term consequences, and peer to peer education.

If we act early here, we can protect not only public health but our environment as well.

Thank you.

Thank you.

Thank you.

And Chair, this concludes non-agenda public comment.

Oh all right.

Um, thank you for that.

Do we have any committee mayor, city attorney, or independent budget analyst comments?

Okay.

Um I will uh just take a moment to recognize that as this meeting's happening, um, hundreds, if not thousands of members of the community in San Diego, in particular our Muslim community, are at a burial um for uh three victims of um a horrific, horrific incident of um domestic terrorism um and and hate crime that occurred here in San Diego on Monday.

Um they um participated in a uh burial prayer at mission in Mission Valley and are um laying those men to rest uh at this time, and um those three men were again victims of of domestic terrorism and hate.

Um a hate that says that uh white people are being systematically replaced, um that Jews are responsible for that, that black people are genetically inferior, that women are responsible for everything wrong in this world, and a desire to accelerate the disintegration of our social fabric and bring about civil war.

Um that's based on uh reporting um from the writings of those who um were responsible for the attack.

Uh they mentioned fear of Sharia law taking over towns in this country, Somali daycare fraud, and that Islam is incompatible with the West.

Um so that was a obviously a horrific, horrific event.

It um has um robbed um the community of three important community members.

It created fear and terror in the um for children and the parents of those children and people across the city.

Um, and uh before we just go about the business of our environment committee, which is obviously uh which needs to be done.

I wanted to make sure we recognize that.

And if we could um take um just uh a moment um to recognize uh with a moment of silence the loss of Amin Abdullah, Monsour Kaziha, and Nadir Awad.

Um, begin that moment of silence now.

All right, thank you everyone.

I appreciate um everyone uh respecting that moment.

Um do we have any requests for continuance?

Okay.

Um we will now move on to our agenda uh beginning with our consent agenda items one through five.

Uh any requests to pull items from the consent agenda.

All right.

Um hearing none, um, let's proceed with public comment on the consent agenda.

Thank you, Chair.

The public comment period for the consent agenda is now open.

The consent agenda includes item one, approval of the committee minutes of April 16th, 2026.

Item two, authorization to execute a contract with NRC Environmental Services Incorporated to provide as needed jetting and pipe cleaning at public utilities wastewater treatment facilities.

Item three, pure water, fifth amendment to the agreement with Trustle Technologies Incorporated for specialized technical support services for North City Pure Water Facility and Demonstration Pure Water Facility.

Item four, collection of fiscal year 2027 solid waste management fee on county tax roll, and item five, water rights agreement between the city of San Diego and the city of Poway.

Each speaker will have one minute per item with a maximum time of three minutes.

Please indicate which item or items you wish to speak to.

We did receive one speaker slip from an individual here in the committee room.

Blair Beekman, please approach the lecture, and you've indicated that you wish to speak to all of the consent agenda items.

You will have a maximum time of three minutes for you to manage.

Hi, Larry Beekman.

Uh hopefully these mics are working.

I've been trying to say that uh these mics have been having trouble lately.

They sound pretty good right now.

I'll continue this way, and uh if I hear it again, I'll make sure to tell yourselves in reviewing this on video afterwards.

Um, thank you for the words of council personal.

I needed those words all week, and he's the person who can deliver them very well, and so I needed it.

These young people have to be held accountable, and um it's from that um we have to understand that there's concepts of love and dialogue and cooperation and how we solve our issues that they will hopefully learn in some part in their lives to better understand and what we're really can take place in those good practices.

The imams of the of the Islamic Center, um practice the same things.

I've been really inspired by their words and uh it's it's with love you know it's care conversation that uh we work through these things and hopefully one day they will say understand a better way of living and how we function and work together in solving our issues sorry I'm I'm stopping Blair just I just I appreciate very much appreciate the acknowledgement I also want to make sure that I'm being fair and um just it's important that we speak to the items on the consent um just so others don't go off course as well sure okay thank you okay uh pure water uh thank you for pure water issues I hope it can relate to uh what um the work that we have to do with pure water can be of inspiration to Mexico and that we have good communication uh with Mexico into our future on such issues um and then I had a few items for the committee minutes that were approved of that um one of the items was um uh urban water management you'll be talking about that so I I can go on with that uh when that comes up later today public power feasibility study we are entering uh next 10 year period it was a really good item and it was important that we had public uh power uh future listed and uh good luck what we can be doing um you gave it a 10 year time frame um good luck what we can do be doing before that and that we're really addressing PG and E every time we're not always relying on PG or SDPGE as the sole source of our lives you know that we every time we say SDG is with the intent that we're thinking how we're building our public power future as well and I hope that's part of our regular dialogue here and um there was one other item oh mission Bay Park things yes um uh a quick note that uh as we are in this time of morning uh I I'm I'm getting a sense you guys are keeping a pretty level head about issues and I thank you immensely for that I don't think it's the time to start investing in more and more surveillance technology um it's investing in communication between each other and how we use our technology that's what we need to really be reviewing in the next six months uh before deciding anything uh what we're going through right now thank you thank you this concludes in-person public testimony we will now move to the virtual queue and I've started the five minute timer there are two hands raised in the virtual queue for the consent agenda and as a reminder to those in the virtual queue please indicate which item or items you are speaking to phone number ending in 8700 please press star six to unmute and let me know which items uh two through five okay three minutes to manage please begin thank you okay on number two the NCR environmental services so under representation Asian operative workers and females in management and financial professional and operative workers please do better thank you on number three which is um trussle tech they submitted a workforce report for county employees uh on April 17th 26 so um they said on on the uh backup material no underrepresentation and they did add this which is very positive they have progressed in um decreasing the uh the lack of um representation for Asians and Latinos and female categories so that's really really good to hear so on number, where are we?

Number four, solid waste management uh dear uh Kirby Brady and the rest of the team.

Uh this is a big big big item.

Uh the whole community is is around surrounded with this and they're they're involved.

So thank you so much.

I don't know if you heard me uh Kirby in close session.

Uh uh perhaps you did, I hope so.

But I trust you.

This is a big issue.

We're still working through it.

I did not have a chance, excuse me, they're doing fire testing in the building.

I did not have a chance to study the backup, Kirby, but I do absolutely trust that uh your uh you're doing the right thing, and you will you will work together for equity and all of those good things.

So lots of love to you on that.

And the last item five, which is the PUD department, yes to the item, and I am concerned about the safety of dams.

Uh Hodges Dam is uh related to this item.

So uh PUD, you know how I feel about you.

I love you.

I I just you know, water, water, water, utility.

So thank you for everything you're doing, and uh so uh yes on all the items today on consent and uh thanks for listening up to all.

Thank you.

Our next speaker in the queue with their hand raised is Zoom user.

Can you please indicate which item or items you wish to speak to?

Zoom user, I've asked you to unmute.

Zoom user, I've asked you to unmute.

There you go.

Oh, sorry.

Hector here.

Hey, I'm down in Mission Bay riding my bike down here, and I live in Mission Valley, right around Friars.

And then number three, I want to comment on number three, the water thing.

They're buried in that sewer line now down in uh Friars Road on the western end, and they have the pump station.

All our sewage flows down to there.

Then they're gonna pump it up to Miramar to treat it.

I would think the pure water guys could put in a valve down here at the bottom next to the river, and they could actually put river water in the sewer pump line that goes up to Miramar to purify our water.

If things got tough, we could pull water out of the San Diego River and shoot it up the pipe up to Miramar and treat it.

Not right now, but in the future.

Lake Mead's at an all-time low right now.

So if we do need the water, we could instead of letting the river flow it all out to the ocean, we can pull water right there and slick.

And it would be now's the time to put the valve in.

There's four foot pipes.

Thank you.

Thank you.

This does conclude your time.

Thank you.

And Chair, this concludes public comment on the consent agenda.

All right, thank you so much.

We'll begin uh council discussion with Council President Lukaba.

Uh thank you, Chair.

Uh, just wanted to make a brief comment on item four regarding the solid waste management fee on tax roll billing.

Uh yesterday, of course, we had a big announcement of a tentative settlement that will have impacts on solid waste management and subsequent items will be coming forward to council.

The settlement did not include or any reference to tax roll billing for FY2027, and today's item remains necessary.

As we've seen, tax roll billing is the far by far the most cost-effective solution uh for uh property uh owners and its reliability benefits both the city and our customers.

And as a reminder, and I'm sure we will hear this again for anyone in need of a financial help.

Our financial assistance uh program is available and will be discussed in further detail later today.

Uh and with that I will move the consent items.

Thank you, Council President.

Vice Chair.

Thank you so much.

Um I would be happy to second the consent agenda, and I want to give special thank you to PUD for their uh wonderful briefings and explanation of their items.

Thank you.

Thank you, Vice Chair.

So we have a uh motion and a second.

Um I'll thank you, Council President, for your work um on um ensuring that we weren't in a very, very scary place um this fall.

Um and as you mentioned, this particular component in item four um saves the uh the taxers of San Diego um many, many millions of dollars, if not tens of millions of dollars.

Um and so uh uh it's it's important that we we kept that, and uh I'm I'm glad um to see that the taxpayers will continue to benefit from uh this more efficient process.

Um so with that in mind, um, we've got a motion in the second.

Uh all those in favor, please say aye.

Aye.

Aye.

That passes unanimously.

And we will now move to our information item, item seven.

Um and we'll begin with hearing from Dan Denham, General Manager, and Jamie Bradford, assistant general manager from the San Diego County Water Authority.

Thank you, Chair.

Item seven is San Diego County Water Authority update.

And if you wish to call in to provide comments on item seven, you can dial 16692545252.

And the webinar ID is 1607, 9638 pound.

Chair.

All right, thank you.

Um, Mr.

Denham, Ms.

Bradford.

Um, if you would please introduce yourself for the record, even though we kind of did that already, um, and then let us know how much time you'd like uh to present.

Uh good afternoon, uh, Chair Elo Rivera and members of the.

Please turn on the microphone by pushing the button.

It is on it's on.

I'm probably just talking in my deep uh radio voice.

Um uh Dan Denham, uh General Manager at the San Diego County Water Authority.

Hi, good afternoon, Jamie Bradford with uh San Diego County Water Authority Assistant General Manager.

Um maybe 20 minutes.

All right, thank you.

Please proceed.

All right, thank you.

Again, um appreciate uh you all having me here today.

Um I hope that we can come back um more frequently.

Uh there's a lot going on here locally and on the Colorado River and statewide.

Um, what I really want to do with this presentation is hit hit three things.

I want to talk about hydrology.

Um I want to talk about the watersheds, the lay of the land in that regard.

I also want to talk about um some of the exchanges and transfers that we've been doing.

Um hopefully you're all aware of those.

They've they've been in the media lately, and we've been very successful in that regard.

Excuse me.

Um, and then I also want to uh eventually get into something uh that we're all very interested in, um, which is uh the water authority's rates and charges for um the next calendar year.

So let me start with um the weather report.

I think uh intuitively you all know that red is bad and white is good here on the heat map.

Um I I think that that holds true with the Colorado River Basin and and how you see it there.

It is uh the worst uh uh year on record in the Colorado River Basin.

Um what what needs a little bit more explanation though is is what you see in California, because California is arguably in a different shape than that that white color pattern there um suggests.

Um we are in a 45% state water project allocation, meaning that we probably only are going to receive 450,000 acre feet of the one million acre foot allotment from the state water project.

Typically, on average state water projects about 70% or 700,000 acre feet worth of water.

Nonetheless, um state water project contractors, metropolitan in particular, who um we are, of course, our member agency of pays uh 650 million dollars a year for water, whether you get one drop or the full allotment of a million acre feet worth of water.

Uh what's really interesting this year about the state and the state water project, and I think just Southern California in general is that we are collectively in Southern California sitting on top of about four million acre feet worth of storage, and and what makes that interesting is that um at that 45% allotment that I alluded to, there's no more parking space left for water in Southern California as it relates to the reservoirs, whether we're talking about Shasta, Oroville, um San Luis, or others up and down the state.

And so that puts Metropolitan in a situation of needing to sell water, getting water off the books, if not there, moving supplies from the state to the Colorado River.

Um, unfortunately, as you see on the screen there, the Colorado River and Lake Mead is a 30% capacity.

Um, in terms of storage, metropolitan is maxed out with its uh storage capacity in metropolitan in Lake Mead.

So there's a bit of a paradox and a conundrum here, right?

Lake Mead needs the water.

Metropolitan cannot put it there.

There's no more parking space in Southern California, and so really I think this speaks to a couple things, and and I hope it really uh helps underscore um what we've been trying to do with the water Authority.

I know I've commented on this, uh presented on this at the city um in the past, uh, and that is to move move water more effectively throughout the West, and and we've been successful at doing that at the Water Authority over the past couple of months.

But in terms of, you know, just how does California view the world right now?

I put these three big ones on the screen.

They're not the only ones.

There's, of course, smaller one-offs that are more focused at the local level.

But this seems to be the crux of the public debate right now in terms of what to do in California.

When you see the headlines, hear the stories about water going under the Golden Gate Bridge, largely sites reservoir, is a reaction to that.

It's the idea of taking uh water in extremely wet years and creating a 1.5 million acre foot store of storage reservoir in the Sacramento Valley.

It captures high flow events.

You know, I just alluded to the lack of storage in California.

Advocates on both sides of the aisle are interested in additional storage in California.

It's just a matter of how much does this cost.

The Bay Delta Conveyance Project has been around for generations, decades, if you will, from the Pete Wilson administration.

Uh to having this project anywhere near being complete.

But nonetheless, it's uh it's a project that's arguably needed from an infrastructure perspective.

Um, environmentally, um there are pros and cons to it with uh ecosystem impacts on the Delta.

Um, but I will say that a project of this nature, although with a 20 billion dollar price tag, I think we need to start thinking about things a little bit differently in terms of at least reinvesting in a portion of this infrastructure.

How that impacts San Diegans, um we we would all um presumably feel a piece of that in our wholesale and retail water rates.

Um Pure Water Southern California.

Um I think that you all know the idea behind this, of course.

Pure Water Southern California is Met's project.

It's uh originally started at 150 MGD, it's being scaled down to 45 MGD at this point.

There will be a big decision at the Metropolitan Board within the next six months or so as to a go no go on all this.

I bring all I bring these three forward to you because the the timing, affordability, equity, and scale of these projects, they really do impact generational um policy decisions.

And I hopefully it goes without saying uh we can't have all three.

Um I don't think that we can afford all three.

Um we've gotten to the point where we are going to have to pick and choose, or at the very least, start to do things a little bit differently in terms of uh water management in Southern California.

Um Colorado River negotiations, again, hopefully no surprise to all of you, but um things are at a standstill.

Um in 2007, we negotiated operational guidelines as to how to um manage uh uh Hoover Dam and Glenn Powell or uh Powell PAL Dam.

Um we've had since then to figure out how how to how to can either continue those operations or move it differently in 2026, and um the parties have missed several deadlines.

Um I I think that this is probably the last year that um all of us, whether that's the state level, federal level, or local level, um, will be able to rely on um power generation out in Glen Canyon Dam and a steady flow of water in Lake Mead.

I say that because we are about 30 feet away from losing um power production at Lake Powell.

30 feet away that's being mitigated by bringing water from upper reservoirs this year to keep uh to maintain a minimum power pool.

At the same time, the federal government is mitigating for elevations that at Lake Mead, which could cause uh that reservoir to go to deadpool within a year.

The way that they're doing that is they're curtailing the um amount of water going into Lake Mead.

What is normally a 7.5 or 8.0 million acre foot release from Powell to Mead is going to be reduced to six million acre feet this year.

Um, so the river, the river is is arguably in the worst shape that it's ever been.

But the time is now, of course, to uh to get some water behind the dam.

And whether it's the project that I described to you on the previous screens or anything else in the basin, none of this happens overnight.

And I think thematically, as I start to talk through some of these water transfers with you, I I think you'll get the sense of why it's it's providing a little bit of promise going forward.

Um urban versus agricultural water use.

This is always going to be in the headlines when times are bad.

And you know, I don't I don't think, I don't feel that um, you know, we should have conversations about whether we're growing microchips and data centers versus alfalfa in the Imperial Valley.

Um those are those are conversations that don't need to happen.

I think that those two um polarizing issues can coexist.

Um, and they can coexist because they already do.

And the San Diego uh Imperial Valley water transfer is is a shining example in the basin as to how an urban water agency can work with agricultural producers in the Imperial Valley to where there's a balance.

Um the US Mexico Treaty, Mexico has been um a good partner to the U.S.

in terms of water over the years.

Um they've been willing to reach compromise on a lot of very, very tough issues.

Um the problem that has arisen with the the U.S.

Treaty with Mexico from 1944 is that they are going to need to share in reductions on the river in the same manner that the upper basin and lower basin um share in reductions.

The argument between the upper and lower basin is whose allotment does that come out of.

Um the upper basin, of course, believes that California and Arizona should provide uh reductions uh to Mexico, and the lower basin believes that that is a uh federal obligation.

Um tribal water rights, another as if there's not enough issues here.

Um tribal water rights um are front and center once again, as they always are.

Um this is largely an Arizona issue, and it has to do with uh compensation to the tribes for water rights that are long standing and the federal government's role in fulfilling uh trust obligations with uh those tribal communities.

30 federally recognized tribes in the Colorado River Basin.

All this gets to what no one wants, but we're probably headed there anyways, and that's litigation.

Um, when the the parties can't get along, um, the seven basin states, when states when states sue states, that automatically puts um the matter in front of the Supreme Court.

Once it's in front of the Supreme Court, uh a special justice is appointed, and the decision will be made in some form.

So I'm not sure that that situation is the best for all of us.

Um protracted litigation.

We've seen it in the past in Arizona versus California.

Um it's taken decades, and I don't think that the hydrology this time around is going to let us have that much time.

So let me move on to some good news.

Um, so I want to talk to you about um the vision of the future that we have here uh collectively at the water authority and and hopefully within the region.

Um, of course, our um what you see on the screen here, these are the sort of the uh the some of the tenets, the vision for the future, long-term uh resilience and durability, flexibility, um, maximizing um uh the assets that we have and and adapting to changing conditions in an innovative manner through partnerships.

Um but really I don't want to bury the lead in in all of this, and I what I would hope is the takeaway that you have from the entirety of what I'm talking about today is the new balance that we have between rates and our supply demand balance in the region.

Um this is at the core of everything that follows um the byproduct of this, of what the water authorities done over the last year is we've been able to change the shared narrative that I think many of us have had in the region, which is there is a contract supply demand in balance that rates will continue into the future into with a trajectory of being in double digits.

All that has changed in less than a year's time.

Um so what we have now is a balance of regional supply and demand.

I'm gonna have a chart for you, I'll show you that in a little bit.

And that's gonna stick into the foreseeable future where demands in this region, which account for pure water phase one and phase two coming online are in balance.

And importantly, we're out of that double-digit rate territory.

What I'm gonna be bringing to my board next week will be a staff recommendation to have rates for the next calendar year at 3%.

It's quite a different environment than the last time was here in front of you.

The last several times we've all had private and group conversations where uh rates into the foreseeable future were something uh that we're all uh absolutely dealing with.

So how do we get there?

Um, a couple things that we focused on, and this this is all happened over the past year.

Um we've we've looked within Southern California, I've alluded to QSA, the quantification settlement agreement, water exchanges within the Met family.

I'll hit on that.

Statewide, the water authority has access to groundwater banking in the Central Valley.

Um we've monetized that.

Um, and what we look to in the future is interstate transfers to Arizona and Nevada.

Um, but all of this really started with the end to litigation, and um, you know, this is a presentation in and of itself.

I think you all know what litigation meant to this community, meant to this region over the past 15 or so years.

I still always say that we went into it for the right reasons.

It was with the rate payer in mind.

We were successful in early stages uh of the litigation, brought hundreds of millions of dollars back to the ratepayers.

Um, but candidly what it did is it destroyed many of our relationships in Southern California.

And I think that what we've learned, um, the reflection over the past uh year or so is that it's those relationships that we relied on that camaraderie um amongst water agencies that have allowed us to write the ship here in San Diego.

Um so with this, we we developed a rate um for the transportation of 60% of our water that's smooth, it's predictable, and it's at an inflation rate that is manageable when you look at that with the cost of our supplies coming in from the Imperial Valley.

Um what that settlement did is it allowed us to line up the first of hopefully many more transfers or exchanges of water between the San Diego County uh region and in this case, uh Riverside County.

In March, we inked a deal with Western Municipal Water District for 10,000 acre feet over the next 21 years.

Um very similar type of agreement with Eastern Municipal Water District, also in Riverside County for 21 years.

Um what that will bring in over that 21 year period will be 660 million dollars uh to the water authority, 174 million um within the first five years.

Um I think it's important to note in all of this is that there's there's no windfall of cash associated with this.

Um what this does is stabilize sales for the region, um, arguably sales that were lost or displaced when two members left the San Diego County Water Authority in Rainbow and Fallbrook.

I think it's a very good proxy um for all of you in your minds as you think of what was the impact of losing those two agencies.

Well, it's very close to 20,000 acre feet worth of water.

So I think what this speaks to is it it's helped stabilize things, get things back to where they were, arguably, you know, five, ten years ago with those sales, the 20,000 acre feet.

I just want to very simply show you how this works.

Um, you know, we talk about paper water transactions, virtual water transactions.

This is this is the graphic construct of that, and it's it's no more simple than the water authority paying the Imperial Valley to conserve water you know over the course of the the 45 or 75 year agreement if if it's extended.

The Impero Valley leaves that water in the Colorado River.

Of course, there's no drug pipeline to San Diego, and the water makes its way through the Metropolitan Water District uh to the San Diego County Water Authority.

That's the CRA, the Colorado River Aqueduct, that was the crux of the litigation over the past 15 years.

The cost to get that water to San Diego is what we're in uh disagreement over.

So the water is in the system with no new infrastructure Riverside County, the two agencies pay the San Diego County Water Authority a negotiated rate and it's no more simple than the water makes a left or a right turn off of the aqueduct at the turnout to Riverside County.

We're looking to extend this concept a little bit and I alluded I alluded to this in terms of what what we want to do at the federal level another virtual water transfer.

This one of course involved involving the the Carlsbad diesel plant we've had um a lot of support we've been at this for probably about two and a half years to to get the federal government to recognize and in many ways accept that we believe and now they believe that they have uh the authority the secretary of the interior has the authority to make some of this happen.

We have a signing ceremony in a couple weeks here with a number of parties um this is with Metropolitan it's the Southern Nevada Water Authority it's the Central Arizona project it's the Arizona Department of Water Resources and the Salt River project.

What the uh MOU intends to do is prove up the legal framework to make this happen for the first time in the West and on the Colorado River.

It's all about augmentation augmentation of the river coming from D cell water in this case which can be moved now and overnight and future water supply development that being reuse throughout um California.

So again the simple graphic replace the riverside agencies with the Carlsbad plant this can take many forms whether that's a direct payment from another party to the to uh channel side resources to the water authority but nonetheless uh water is produced at the plant um that water um comes from the imperial valley who leaves it in Lake Havasu and then simply um Lake Havasu is the sort of clearinghouse to move water through existing infrastructure um to the communities of Phoenix Tucson and the outer limits of um of those major metropolitan areas so in terms of the the groundwater bank um we have had access to this ownership rights in the bank for uh about 20 years we've moved water down in the past um we've sold water during droughts um the balance that we had in there of 7,717 acre feet uh we just recently sold for 3.4 million dollars uh that's the going rate for water right now in central valley um that rate is uh arguably so low because the state of california as I alluded to earlier is sitting on a great amount of storage uh four million acre feet um metropolitan similarly um is selling um upwards of eighty thousand to a hundred thousand acre feet worth of water um out of its groundwater storage banks at this point in time I feel that everyone's sort of waiting for the next drought and their their banking on on that going forward um I think the silver lining in all of this is non-rate revenue um I I think that I've I've mentioned this to the council in the past it's certainly something that's important to the water authority um it it provides flexibility to all of us non rate revenue from a Prop 26 or Prop uh 218 perspective um and the ability to be a little bit more creative than uh Prop 218 and Prop 26 allows us to be um you know whether we're talking about a cell tower lease um whether we're talking about property tax revenue land leases or hydropower revenue no amount should be considered too small um in terms of the flexibility that it brings us to uh to mitigate some things that are in in need of change in need of serious change that we're we're uh we're having problems with with with 218 and it has to do with mitigating um low-income users, low-income rate assistance, and the farming communities that that support the economy here in the in um the San Diego region.

So, in terms of what we get out of this, when the entity that we lease the the um the groundwater bank to puts water in and takes water out to sell it, that type of transaction, the water authority receives proceeds on that transaction.

So what we get is about 150 dollars an acre foot on each transaction, which we've kind of modeled out that over the term out to 2035 will produce about 30 million dollars.

And so that's 30 million dollars in non-rate revenue.

That I'm gonna be really excited to have a thorough policy discussion our board on as to how we can use that out into the future.

So here's a chart that's that's new, it's been updated.

It used to look a lot different.

It used to show a contract supply line that was way above the demand line, but this is the new reality that we're all dealing with.

This is the the change in the uh shared public narrative that I alluded to.

Um water, water authority.

Of course, our supply is the lighter blue, and member agency supply is the dark blue.

It accounts for phase one of pure water San Diego, East County potable reuse, oceanside reuse, um, and pure water San Diego phase two with an assumption that it comes on in its full um volumetric force in uh 2035.

So what you can see here is what we have in this gray band at the top.

Um what this really represents is our ability to move more water and further get that contract supply line um uh moved even lower compared to demands.

So here's here's what the gray area at the top of the screen represents.

In the fifth in the settlement agreement that we have with Metropolitan, we can move 50,000 acre feet worth of water within the Southern California family.

We've already moved 20,000 acre feet just this year, or will have by the end of the calendar year.

Um we're already in negotiations with a number of other parties to add to that and get to that band that that maximum bandwidth within the exchange agreement with Metropolitan.

Um the gray area that you see in total uh is about 45,000 acre feet.

So with maxing out the MWD exchange at 50,000, you kind of get the sense of of where we where we would be at, and I'm pretty confident that in the next year, if if I'm here this time next year, I'll be telling you about um additional transfers that we have.

But if we don't get there, here's some other things uh to mitigate that that band.

Um there's gonna be the natural growth that we just simply don't know about that will or maybe will not occur in 2045.

But nonetheless, I I think having water in the desert region is better than not having water in some form.

Um, but we're what we're also able to do is ramp down the DSAL plant.

So we can take the thing from 56,000 acre feet all the way down to 18,000 acre feet, and we've done that in the past, and it's a tool, it's a lever that we have.

The third and final tool to mitigate that band um going forward would be the water transactions on the Colorado River, moving water from the DSL plant virtually to Arizona, Nevada.

All of those levers when pulled puts us absolutely in line with where our contract supplies are and gives us that flexibility that I think that we've all been looking for over the past several years.

So this is sort of where the rubber hits the road.

This is the this is the benefit of what we've done in uh January of this year.

Um the board approved a long range um financing plan.

And we had assumed rate increases along the lines of of what you see on the screen there.

Not quite the double digit rates that that you all have experienced from the water authority over the past handful of years.

Um but nonetheless, still still moderate rate increases when rate fatigue is it is what it is.

It's it's set in and and everyone's sick of it, and I I certainly understand that and live with that every day.

Um this accounts for this slide right now, um, pure water phase one and pure water phase two.

So with with phase one online, presumably in 2027, that volume um now being taken by the city or or lost from the city, a 5.8% rate increase is what we were projecting out to 2035, 10.6%, with pure water phase two coming online.

As a result of those transfers that I just described and some of the other actions that we've taken, um, this is the new rate future that we're looking at, something that more resembles um inflation.

Whatever inflation means to you, whether it's three or four percent, I would tell you that there's a lot of data and there's a lot of experience in the utility industry that suggests that keeping public utility rates and enterprise fund at inflation rates, even inflation plus one is is probably a best practice in terms of um, you know, sustaining your infrastructure and sustaining salaries for employees, everything associated with running a public utility.

That's really where we hope to be.

I think that's where we are now.

Um, like I said, the board will approve um or be asked to approve a 3% rate increase.

Um this is the average effective rate of all the member agencies.

Some are lower, some are higher.

Um, that band um is not as extreme as as you would think, despite the different profiles of the different agencies that um we have at the water authority.

So, last slide here, and this is just to wrap it up.

Um, I think that we we've hopefully you all see we've we've turned the corner quite a bit um from the conversations we've been having in the past, um, fighting with uh our wholesaler and metropolitan, um, fixing that and and moving on to uh changing our business model at the water authority um and doing things differently.

Um, we of course still have a lot to hang our hat on.

The the Carlsbad DSL plant is going to provide options for us into the future.

Um, arguably the cheapest source of supply um in the in the US and the canal lining projects that we have, $30 an acre foot.

That's something that everyone covets in Southern California and the ag to urban transfer.

Of course, is a price point that um you can no longer get at about $800 an acre foot.

Um we're obviously all gonna double down here in the region um with reuse and continue to adapt to reuse projects.

And I think I've showed you in some of the charts here, um, all that's fully incorporated into the water authority's financial and demand profile going forward.

So that concludes my uh my presentation, Chair Ilo Vera and members of the committee.

Of course, happy to answer any questions.

All right, thank you so much.

Uh appreciate the presentation, Dan.

We'll turn to Jordan for uh some comments from the IBA.

Thank you, Chair Hill Rivera, and good afternoon, members of the committee.

My name is Jordan Moore from the office of the IBA.

First, I would like to thank the leadership from the County Water Authority for coming to present to the committee this afternoon.

As you have heard, there has been progress on CWA's long-term financial issues, which mostly stem from having to contractually buy more water than they are projected to sell, particularly when local reuse projects like pure water come online.

As you've heard, while up to 20,000 acre feet of water has been sold in two recent agreements, we note CWA initially advertised up to 50,000 acre feet of is available, indicating there is more work to do to right-size supplies in the near term.

We agree that sales of or transfers of 50,000 acre feet should be the goal in the immediate future.

This holds even if CWA projects sales to be temporarily above taker pay limits over the next year, as water that is sold to other agencies right now is being sold at a higher price than the water that would replace it from metropolitan.

Metropolitan remains CWA's least expensive source of water, but it is one that it does not tap to the extent that it could because of CWA's contractual obligations for other more expensive water, like desalinization.

In the long term, more water obligations will need to be offloaded, and as you saw on the slide, particularly around 2035 when pure water phase two begins.

If additional sales do not materialize in the next couple of years, CWA's future rate increases in 2035 will go back to being double digits and could be larger if current conservation trends do not reverse.

Our office looks forward to seeing additional progress on sales and transfers by CWA, and we'll examine how these actions impact San Diego rate pairs as new information becomes available.

Beyond that, we would reiterate our recommendations around both the development of a new business plan for CWA and management of the City 10.

Currently, we know CWA is working with other regional general managers on a new business plan for the agency that will right-size CWA operations in the current declining sales environment.

Well, outside sales do help defray the cost of water purchases.

They do not cover CWA's own costs for things like personnel, debt service, and other operating activities.

These costs are increasingly paid through fixed rate adjustments, which the city does not benefit from when it lowers its purchases from CWA.

Reducing these costs is crucial to obtaining additional affordability, which has been noted by our office as well as in the draft municipal service review recently released from the local agency formation commission.

We look forward to reviewing the new business plan when it's made available to the public hopefully soon.

In regard to the City 10, while this informational presentation from CWA is helpful, we note that CWA only released their cost of service study for calendar year 2027 this morning.

While you've heard that effective rates are projected lower than what was contained in PUD's last outlook, we need this cost, we need this cost of service study to demonstrate the mix between CWA's volume metric and fixed rate charges, and in particular the city's share of fixed costs, in order to accurately determine the impact of CWA's future rates onto PUD's rates.

We note that CWA's rate hearing is projected to be only about five or so weeks away and would hope that earlier, more timely releases of cost of service studies with detailed rate projections would be helpful.

It is anticipated that with the cost of service study now released and the hearing to be set by the board of directors next month as they begin their review.

We that the council should that our office continues to recommend that the council hold a public hearing before the last week of June to discuss the rate case and provide direction to the City 10 on the council's expectations for the City 10 regarding CWA's rate adjustments.

We note that the City 10 are ultimately accountable to the council, and our office is ready to assist the council with any additional actions they may wish to take in regards to the City 10 and CWA.

Thank you.

And I am also available for any questions.

Thank you, Jordan.

All right, with that, let's hear public comment.

Thank you, Chair.

The public comment period for item seven is now open, and we have received two speaker slips from individuals here in the committee room.

Courtney Brown, please approach the lecture, and you'll be followed by Blair Beekman.

Each speaker will have two minutes to speak to item seven.

Okay, I will try to be quick.

Um good morning, good afternoon.

Uh, my name is Courtney Brown.

I'm a staff attorney with San Diego Coast Keeper.

Um, really quickly, I really want to I say that I appreciate County Water Authority GM, Dan Denham, and assistant GM, Jamie Bradford, for taking the time to present here today.

I think it's really important.

Um, and I do want to highlight the water authority has made enormous progress.

The Met settlement, the Riverside County water transfer agreements, the Lower Basin, Lower Colorado River Basin MOU, and the initiation of a business model review are genuinely significant achievements.

Um these achievements are steps in the right direction, but they have not holistically fixed all of County Water Authorities' problems or solved our rates crisis in this region.

So we're asking this committee to seek transparency and independent review in order to serve ratepayers and the county water authority alike.

And this would only strengthen our confidence in the agency's progress.

Um I will echo everything that um Jordan just um explained.

Um I do think that the we we want to highlight and ask this committee to weigh in on LAFCO's um recent decision, recent vote to suspend the MSR of both county water authority and MET for four years.

We think that the MSR had significant findings about the agency that aren't necessarily resolved, and all we're asking for is um is good governance and oversight um to ensure that the math is adding up.

Um we also request the city or the IBA's office to conduct any sort of independent review on the claims about how these sales, particularly the projection that the 20,000 um acre feet will bring rate increases down such a significant amount to down from six to eight percent to around three percent annually over the next decade, um particularly given the drastic uncertainty we're facing now.

So we really appreciate your time and for listening to our comments.

Thank you so much.

Thank you.

Our final speaker here in the committee room is Blair Beekman.

Hi, Blair Beekman.

I from the previous speaker, thank you for her words.

You could really hear the mic as a serious problem.

I think it's this mic that has the problem and it's fritzing out and it short circuits a person's voice.

Hopefully, this can maybe work and we can talk about it afterwards.

I've been talking to you this item for a month, over a month, but I hope we can work on it.

Um to try to offer my comments.

Um we've had uh a lot of difficulty in dealing with waterboard issues.

They've explained they they're trying to put their new program into place, and they have lost allies in that process.

Good luck in rebuilding those allies.

Hopefully, it's just a matter of learning to, you know, invite what the new future of the water board is and what they can be doing towards that goal.

Um, pure water is important.

Uh, what we're doing with the future of pure water.

Thank you immensely.

That uh council personella has very nicely, you know, he's taken the hype out of how we talk about pure water.

It has an important purpose for our future.

It may not be exactly everything, is how I'm understanding, but it can be helpful, and but yet we can't rely on uh as our go-to for everything, and we're gonna have to learn how to navigate that language and understand that scientifically as well and be more clear on that, and good luck how we do that together.

Um, one other item uh to bring up uh the water board here.

They have been uh probably very much inundated with the concept that they have to learn to have a more public process and how they address their issues.

Oh, water increase issues.

Hopefully, their current 3.0 uh percent projections can be at a 1.5% uh increase, and we can haggle over that price at least.

And to conclude, yeah, to work on uh public the public process.

Uh the San Diego Port Commission has been working on the public process.

Accountability is really important.

Uh, it brings so many more ideas to invite the public.

Good luck in that effort.

Thank you.

Thank you.

This concludes in-person public testimony.

We will now move to the virtual queue.

There are two hands raised in the virtual queue.

I've started the five minute timer.

Zoom user, please unmute and begin your comments.

Hector here.

Okay, when you guys heard the heard the words from this guy, we can trust Mexico.

That should have set up a bullhorn.

We're gonna rely on Mexico for our water rates.

We gotta pull some water out of the San Diego River for free and shoot it up there in the middle of the night with nobody using the lines that go up there.

That's free water.

We can get 40,000 acre feet every day of the week.

It's always running.

It's always there.

We don't have to put all of it in the ocean.

Just we'll take five percent of it, and we'll we'll become self-sufficient in San Diego.

We'll tell the water board to pound sand.

They own us, they own us, man.

They determine the rates, and they have a lot of language to how they're doing it, but that's basically what it is.

And then you guys, man, you guys are way over your head on this city council, guys.

You can't even determine a parking fee for the uh double park, man.

This is way over your head.

We've got to build the dam, Lake Hodges, we'll get water there.

We gotta do a world-class treatment plant down in Tijuana.

They give us free water, but it's sewage water out of a million people dumping their raw sewage on us for decades.

They're really we're gonna trust Mexico to give their sewer water, not our other water.

It's ridiculous, man.

Someone's gonna call you should have a bullshit meter in there, man.

At least a bullhorn, a gong show.

Anyway, let's say we pull water out of the San Diego River and shoot it up there and treat it.

It's free water.

We're gonna have the pipe.

And then the only thing about that water thing, we have a huge loan, which we gotta pay.

Collateral for our loan is is the water rates.

That's the collateral.

They can raise rates for the loan no matter what.

So that's the collateral we got on that loan.

It's raising the rates of everybody in San Diego.

Thank you.

Your time has concluded.

Our final speaker in the queue is phone number ending in 8 70.

Please press star six and begin.

You'll have two minutes.

I think you uh Joy Sanyata.

Uh dear uh committee and and city council.

Please listen to Jordan Moore regarding the June meeting.

And and Jordan, uh I might email you.

I'm very concerned about what you said.

I'm confused about the current conservation.

Do not doesn't reverse or something.

I I don't know, but I I've got to find out what that's all about.

So anyway, thank you for the presentation.

It was very good.

And um, yes, please come back more frequently.

Uh that's gotta happen.

And I'm so glad that you said that.

Uh I I just can't emphasize that enough that that uh chair Ido Rivera uh please make that happen.

Would you uh I'm sure you can collaborate and make that happen.

The public needs that.

So move water more effectively, uh, more storage, water management in California.

All of those to me speak like improving the system, which to be honest with you, uh San Diego County Water Authority has needed to do updates, and and it looks like you're making progress, but I don't understand how good the progress is yet, but I do feel it's moving forward, so do keep that up.

Um I I don't like the words about the litigation that's possible, protract it.

I think you labeled it.

So I hope we can keep away from that.

Uh I really appreciate the vision of the future.

I I'm really on to the word vision right now for our city, so keep that up.

Uh I I want the policy discussions to happen.

I love the word initiative, resilience, flexibility is a big word, and it does affect our water rates.

So uh big on conservation.

You all know that uh we we are looking to the pure water impact and how it will affect you.

We want collaboration when that happens because we appreciate that can impact you, and we want to be there with you and want to sit around the table.

Thank you.

This does conclude your time.

And Chair, this concludes public comment on item seven.

Uh thank you, Natalie.

Thank you to everyone who offered comments.

Uh, thank you, Dan, again, um, for um for the presentation.

We'll turn to Vice Chair Campbell for questions and comments.

Thank you so much.

Thank you so much, Chair.

Uh first of all, thank you to Dan and Jamie for coming today.

We really appreciate all the hard work that you have done in the past several months uh to make our county water authority much better.

Uh and uh first of all, I want to thank our 10 members of our San Diego uh City members of the County Water Authority for their hard work, and especially our chair Nick Serrano, who's our own uh San Diego person who is now chairing that board.

Uh I would like to ask that we continue that the water authority, the county water authority, you guys continue to always review your budget and make it available to our city council openly, transparently, so that we can understand about the costs.

I I know things have improved.

I wonder if there's more room for improvement.

We must help the ratepayers of the city of San Diego, those who use our public utilities department to get their water.

We need them to benefit, they are hard-pressed, and we need to help them.

So I'm greatly encouraged to hear about the possibility of the rate increase being much much less than we had expected.

And I'm very glad to hear that good news, and let's keep up the good work to try and help our city of San Diego residents.

Thank you.

Thank you, Vice Chair, Council President.

Uh, thank you, Chair.

Um, I do.

Well, thank you, Dan and Jamie.

And uh as an engineer who thinks he knows a lot, you threw an awful lot of information at us.

Um, and I think that was exactly the right thing to do because it is that complex.

Uh we can often be guilty of thinking that it's a very simple thing.

Just get us the water, give it to us at a low price, and we'll move right along.

But there are so many different factors, balancing the entire Colorado River Basin, and how the drought affects different parts of that differently, the different agreements that have been made over the years.

If things don't go well, if there's prolonged droughts, and that necessitated building very expensive infrastructure that now is in place and has to be maintained.

And you have a decreasing demand.

And you've done some extraordinary things.

That's pretty huge.

Although I guess somebody wants you to cut it in half again.

I'll let you figure out how you're going to do that.

So I'm so grateful for that.

Coming here, I think helps us talk to our ratepayers when we go through our water rate studies as well.

And I know that we'll be having one in September, October.

I think we'll announce it before we go on break.

So having the latest information from you really helps us set our water rates going forward.

I'm not going to try to delve into the complexity of everything you put on the table because I'll just look like a fool here.

But we appreciate your availability.

I think there's been a quite a sea change at the Water Authority, and the average person may not see it, but I think a lot of us do.

And we're very grateful.

And I've heard a lot of people speak very highly, Dan, of your leadership.

I know Jamie adds to that as well.

And that can only serve us well over the long run.

So a couple of questions.

One, uh, we heard um uh quite a statement from the coast keeper um and some of their concerns um and that inner relationship with LAFCO.

Do you want to offer any response to that at this time?

Yeah, I can provide some some thoughts on that.

Um, look, to be candid with you, um the the MSR, um, the re the results of the MSR, what's in it.

Um, this is largely a matter of governance, and it's it's a governance conversation, and it's it's groups, um, whether that is the member agencies that I have, whether it's outside, and and it it's it's a conversation around the city's voting percentage at the water authority.

Um, it became apparent over the past three years.

We've been working on this MSR for three years, where um, you know, there were conversations about dissolving the water authority, becoming a pipeline agency, even condensing it into uh or taking over retail service.

What we've just done, what I've just described to you, really wiped all of that out.

It it showed at least financially and from a demand perspective, um, what we've done and the data that was contained in that report was arguably four years outdated.

So all the conclusions that were being made were being made based when I was here three years ago telling you about 18% rate increases.

So at its core, and and what I think that this community, the San Diego region needs to come to grips with is a conversation like what we had many years ago at SANDEC, right?

And and this is this is a governance issue, it's a legislative issue.

Um, arguably for all of you, it's a political issue, and it has absolutely nothing to do with running the business of the water authority.

Now, there are financial impacts associated with whether the city votes a certain way, of course, absolutely.

Um, but that's the current law, and I'm going to run the organization based on our admin code on our city charter, if you will, and until that's changed, I'm really indifferent.

But that's the core issue with the MSR today is the city's voting power at the San Diego County Water Authority to be blunt.

Okay.

Thank you for taking the time.

Council President, can I ask something really quick?

Yeah, yeah.

Because I think it's an important conversation happening.

And I, you know, it's not mass members of the public, but there are people who are curious.

MSR.

Yes, sorry.

Municipal service review.

Yeah, thanks.

I think that's the mechanism by which LAFCO, which people also do not know what is, uh, really looks as part of their jurisdiction at every public agency uh going forward.

Uh so I appreciate your candor.

I appreciate that you highlighted uh that the rate projections that you showed there um include both City of San Diego phase one and phase two, that you were actually are planning for that.

Uh and I appreciate from what I'm able to discern that while there's a lot of calls from our ratepayers about keeping costs down low, uh, that it is done in a way that is not reckless and just simply bends to that call.

Says fine, we'll just downsize it and then take the risk that something won't happen and and we'll get all of ourselves in trouble.

Um I think the last thing uh chair, I see that we have a few members of our city 10, including the chair of the water board.

Uh Mr.

Serano, would you like to offer and your thoughts?

Uh Council President, uh definitely appreciate the opportunity and appreciate um my colleagues from the Water Authority for being here to present uh to you all.

I think the only thing that I would just um submit to you all is that you know, as the mayor's deputy chief of staff is the chair of the San Diego County Water Authority, a representative for the city.

Um I take direction from the mayor and you all.

And what I hope that you see is me, the City 10 being responsive to that direction.

When you all asked us to keep water rates low, every rate cycle that we've gone through, the city of San Diego has never accepted the staff recommendation.

We have driven water rates lower.

When you all suggested that we need to start selling water to jurisdictions that need need it, well, I think you've heard that we've been able to do that, and we were instrumental, the city of San Diego in settling the litigation with Metropolitan, which unlocks that opportunity.

All of these pivot points, all of this progress that the water authority has made over these last five years is because the city of San Diego is at the tip of the spear, leading the way and providing the guidance in the direction.

We're very fortunate that we've also had the leadership of Dan, Jamie, and ET all at the San Diego County Water Authority who have agreed with those pivots and that progress that needs to be made.

But at the end of the day, uh we continue to take direction from the mayor and the city council.

We continue to prioritize rate pair affordability, and that will always be our North Star at the Water Authority.

So you have that ironclad commitment.

Uh we will keep coming back, the San Diego County Water Authority will keep coming back.

I will keep taking your direction to the City 10.

And so I appreciate the opportunity again to offer those comments, Council President.

All right, uh, thank you, Nick.

Uh then I'll just kind of close uh with this, given Jordan's uh recommendation that uh the council here from the full City 10 uh in a very busy June calendar.

Um my office will circle back and see what your thoughts are about when we can do that uh in a manner that is actually productive for everyone going forward.

So thank you for that.

Uh again, thank you both, Nan and Jamie, for coming today and your presentation, and that concludes my comments, Chair.

Thank you, Council President.

Um, start by saying thanks again, Dan, um for for coming and Jamie for being here.

Um, we we wanted to create a a space for some open dialogue between um the city and the water authority um that wasn't happening in the heat of of you know a conversation about um, needing to vote on on rates, um, and and just make sure that we we're continuing the conversation more regularly.

Um I think that a lot of what you uh spoke to today um is an example of you know what our region needs to be doing to address affordability and rising rates, and you heard positive feedback from um from committee members um i'll I'll echo that um from folks from the public who have oftentimes pushed back and and said that um the water authority could be doing more to help keep rates down um i i did want to um ask about some of the water rate assistance bills moving through state legislature um in terms that an everyday person can understand um can you speak to how the water authorities engage on those bills and then what outcomes a ratepayer should expect if those if that legislation was signed into law yeah let me kick this off and then and Jamie's gonna jump in on this um I'll I'll pivot back to the comments I made about uh prop tape Prop 218 and Prop 26 which limit all of us in in what we can legally do in terms of providing low income rate assistance there are actions that have uh sputtered over the years to have some form of state funding um I if I am being honest uh you know the position to that has always been um how do we manage this at the local level at the retail level at the cities level how do these costs flow through um and put an even greater burden onto retail water agencies once we can crack that nut I think we'll take a giant leap forward um there has to be a a state level of funding associated with this um but that's just kind of my high level perspective Jamie has the the info on the bills.

Uh yeah I think I just back up in in 2015 there's legislation passed that required the state water board to develop a low-income rate assistance program and there's been versions of legislation since then that have not made it through the legislature um and uh we were involved last year in support of SB 350 um I actually think chair you might have sent a letter to us in support of of that position as well um that was held in Senator Propes last year um this year there are two pieces of significant legislation one is um a B 2739 which would actually create the funding for um for a low rate low income rate assistance program the water authority has already taken a support position on that and then next week we're bringing forward uh SB 1125 which would actually create the program um the author of the bill has really taken the lessons um learned from the past versions and of trying to incorporate um the local agency input on you know the complications of of um implementing such a program so um for the for the rate payer um you know you would see a as a rate tener we'd see a a either a 20 dollar credit or 20% off the full bill whichever is greater is what it says right now for for specific people who qualify in a specific way or correct it it they're looking at current programs already so they would auto-enroll.

Got it.

Sorry I didn't mean to interrupt just want to make sure that part you didn't interrupt um thank you for that I mean that that is um simultaneously uh gives me some hope and is frustrat frustrating because if I understood you correctly we're about 11 years into um the development of a program to provide assistance to folks to pay for water um in the most you know in a in a state where affordability is and has been the number one issue for folks long before it was um long before politicians were were you know seeing that it it popped in polls um and that's just super frustrating and I think an example of of just kind of losing the forest for the trees um we're trying to make life more affordable for folks and we should do that in the most streamlined and efficient way possible.

Can I just the the uh really quick just the status they're both waiting for their third reading and their house of origin.

Are you hopeful?

Um sure.

It's hard, you know, with you seeing what what has happened in the past.

I think there's a will there.

Um, you know, as we all struggle with budgets, it's it's about fun, you know, getting the funding across um the finish line.

So, you know, we'll continue to to push on that.

And again, as as Dan mentioned, you know, just the constraints with whether it's Prop 26 or Prop 218, which is why let's go back full circle, the non-rate revenue is so important.

Um that that part of that system that's been built to uh create really no flexibility.

Um, you know, the the this city is dealing with and it's not just gonna be the city, um, agencies across the state are gonna be dealing with ramifications of a decision that me that basically says no matter how much water you use and where you use it, um, we can't charge any different for grandma who's brushing her teeth with water, and a um very we're very wealthy individual who just likes the way the water looks running across their lawn.

Um, and that might sound a little bit dramatic, but I don't know that I'm wrong in describing it that way.

And there are wealthy individuals in this state who have spent considerable resources and um require the city to utilize considerable taxpayer resources to keep that system in place and in the most extreme version possible.

Um so again, that makes the non-rate revenue that much more important.

Um and I'm just really glad to see us um leaning more and more into that.

Um one additional question along those.

Well, let me let me uh ask this first.

Um there was a couple references to the cost of service study.

Um and we're hoping that that can get to the city as soon as possible.

Is there a timeline on when the city will be able to receive that?

Yeah, it it's out now.

Um we we can provide that to you.

Um, you know, just in in all candor, the reason that that it takes so long is because we're making last minute changes to it, and you know, there's an internal process, but um in my mind, the most important variable in that cost of service report is also the most simple, and that is how much water you're gonna sell, right?

And so we are up until the last minute continuing to update numbers from our member agencies.

And it came in this last time around that the water sales projection was higher, higher water sales projections means lower rates.

Um and so bringing it early, you wouldn't see that three percent.

Um it would be something different.

But now that we have the true and accurate data from our agencies, that's that's what helps us get down to that number.

Thanks, Dan.

Jordan, does that sound good to you?

You have any qu follow-up questions on that?

No, I would agree.

I will just say part of why I stumbled was when I wrote comments last night it wasn't up and I checked it again this morning, it was, and it just takes time to get through the hundred plus pages of cost of service that they have.

But that's also why I can't tell you today what's gonna happen.

Yeah, but with more time we can.

Thank you.

Um Dan, you Dan, you spoke about the the transfer agreement, and I we're really appreciative that those are happening.

Can you to the best of your ability kind of explaining in your opinion, um how much that is currently and has the potential to um kind of bridge the gap between demand and what we're purchasing and I mean how much how much more is there on that tree to to uh pull from?

Yeah, that um there there's still a lot more fruit on that tree.

Um I I alluded to the 50,000 acre feet that we have with Metropolitan, we still have 30,000 acre feet worth of bandwidth under that settlement agreement to move water within Southern California.

Um we're in active negotiations with other water agencies in Southern California right now to build on top of that 20,000 acre foot transfer.

Um it's too early to tell you how much, but it will be significant.

I mean, it it's already looking like it could be at the very least half of that, and then what transpires um on the Colorado River, that's gonna take longer.

But we have a lot of those tools now, and you know, I um in terms of where we want to be in the future, the goal is to max maximize the 50, move some water on the river and balance uh pure water San Diego phase two coming online, which I think that we are set up to do.

Thanks for that.

And I I guess like there's the again trying to translate this into just everyday, you know, everyday working people language.

Yep.

That volume of water being sold.

What does that look like in terms of a dollar amount?

And and then because that helps us then break down, you know, and then this is how much could then be available to uh bring down cost for ratepayers.

Yeah, so um the the 20,000 acre feet of of sales um it we we sold it to it's it's Colorado River Water, we sold it to the agencies um essentially at the cost that we we get it for and what we transport it at.

So that's about 1,400 an acre foot.

Um 20,000 acre feet worth of sales.

I again I mentioned sort of the proxy and all this is detachment.

If you if you remember detachment, similar volumes, different price points, but losing 20,000 acre feet worth of sales had an impact on our rates of about three to four percent for every um nine million dollars.

I think that this is the rule of thumb you might be looking for.

Every nine million dollars is about one percent rates, so order magnitude.

Um that is the um the long-lasting impact of of all this.

That's how you get to the six hundred and sixty million over the first 21 years, got it.

And so three to four percent, but to make sure I'm um I am and everyone else is clear, the difference being that the sales are non-rate revenue, correct?

Or no?

No, that is rate revenue.

Right.

So um there the components of the groundwater bank that that we leased out and that will develop proceeds on, that is future non-rate revenue.

So that's across the board savings.

That's not we can't turn that into 10% savings for the lowest income individuals and keep everyone else where they're at.

We cannot.

Got it.

And again, I think this is one of the reasons we want to have this have this conversation is it it helps, I hope.

Explain what sort of boxes that we're working in within at the local level and what changes may need to be made um at the state level in order to give us more flexibility to ensure again that the folks who most need the assistance for the people who um five to ten dollars a month really makes a difference for um it's a pretty it's a pretty tight box that we work work within.

Um and that makes uh both like creativity and persistence, I think that much more important.

And again, I appreciate you um leaning in here.

Um so I I uh don't have any other questions.

I'll just say thank you again for the effort.

I appreciate Nick you um providing the response that you did um about the role that the city 10 plays in in um in pushing for these things.

Um you know a lot of this conversation is is frustrating because um there are things that are outside of our control.

Again, I appreciate every effort that we can make to do the things that are within our control, and then uh lean in and make sure that we're exerting uh our power as a region and as a city to change the rules at the state level so that we can turn this kind of vague reference to affordability being a priority and to action that actually saves people money um on a on a on a monthly basis.

Um so with that, thank you again.

Um uh Dan and Jamie appreciate you all being here.

Um that brings us to our next item, which is item six.

Um Natalie.

Item six resolution supporting Senate bills 905 1098, 943, 1138, 1359, and 913, and assembly bills 2463, 1761, 2493, and 2516, addressing utility, affordability, and accountability.

Chair.

All right, um, so my office will be presenting this item in partnership with our friends at the climate action campaign.

Um, with that, I will hand it over to to Diana for the presentation.

If you can introduce yourself for the record and let us know which time you want for your presentation.

Uh good afternoon.

My name is Can you please turn on the microphone by pushing the button?

Thanks.

There we go.

It's the best of us.

Uh good afternoon.

My name is Yana Frias, community representative for District 9.

And joining me today is uh Anthony Dang, the policy and community outreach manager at Climate Action Campaign.

And we will need five minutes.

All right, jump right in.

All right.

Um, on behalf of council member Ilo Rivera, we are here to present the resolution supporting a package of state bills addressing utility affordability and accountability.

And I will hand it over to Anthony to get us started.

All right, thank you, Deanna.

Uh first let's serve with some background context across the state, utility rates continue to increase the cost of living for millions of residents.

Uh utility bills really impact every single San Diegan, regardless of your background or income level, but it does disproportionately impact communities of concern and low-income families.

Um, I'll also point out that having low energy rates is really important for building decarbonization strategies within the climate action plan.

Uh, I'll go ahead and further illustrate um the challenge with some statistics for reference.

In the past five years, the average rate of inflation in California has been 3.6%.

And we are seeing that SDG utility bills on average are increasing by 9.1% every single year.

So that is consistently outpacing the rate of inflation.

Um, and as I'm sure many of you know, San Diegans are paying the highest uh utility bills in the continental US, approximately 70% above the national average, and an average monthly residential bill is $313.

Uh since 2021, we have increased in 200 million dollars in terms of our regional utility debt.

Now, nearly 30% of customers are um qualifying for bill assistance because of that, and are falling behind on paying their uh energy bills.

Um, and that's also on top of the fact that SDGE currently has six uh rate increase requests at the CPC as we speak.

And so all that has really brought us to this moment.

I would say the Sacramento legislature, it might be the busiest year in terms of energy affordability legislation, which is really exciting that um our state reps are uh trying to address this issue.

So local and state authorities are pursuing the utility affordability and accountability legislative package, which seeks to enhance California public utilities commission oversight and implement more equitable pricing structures to mitigate the rising cost of living.

I'll pass it off to Deanna to introduce the package.

Yes, so the resolution for the utility affordability and accountability legislative package we are seeking to bring forward includes support for the following Senate bills.

Um, starting off with SB 905, which expands low cost public financing options for capital projects, SB 1098 reduces corporate overspending and limits spending decisions.

Uh SB 943 incentivizes clean electricity through rate adjustments.

SB 1138 reduces procurement costs on ratepayers.

SB 1359 creates a framework to prevent customer payments for faulty gas storage, and SB 913, which expands energy resources through multiple pathways.

Additionally, the resolution will include support for the following assembly bills.

AB 2463, protecting ratepayers from inconsistent billing, AB 1761, which requires data disclosure to prevent billing errors.

AB 2516 establishes the California Grid Manufacturing Initiative, and AB 2493, which prevents utility overspending through independent oversight.

And pretty straight to the point.

Recommend that the Office of Councilmember Sean Ilorirera work with the Office of the City Attorney to draft a resolution supporting a package of state bills addressing utility affordability and accountability.

And that concludes our presentation, and we're here to answer any questions.

Thank you.

Thank you.

Thank you, Deanna.

Thank you, Anthony, for uh your work on this in partnership as well.

Do we have public comment?

Thank you, Chair.

Yes, we have received two speaker slips from two individuals here in the committee room.

Park Troutman, please approach the electoral.

You'll have two minutes to speak to item six.

You'll be followed by Blair Beekman.

Hello, my name is Park Trautman.

I'm with San Diego 350.

While we believe that public power is a necessary long-term solution for energy affordability in San Diego, because we don't believe that STGE will temper their own profit seeking on their own.

That is a long-term solution.

In the meantime, there's a lot of things happening in Sacramento.

There's a lot of thoughtful legislators coming up with creative solutions, like the ones in this package today.

They are really tackling energy affordability from all different kinds of ways from dealing with supply chain issues with the equipment by building like local uh statewide union uh equipment uh that's built with uh union labor to reducing peak demand through increasing use of distributed energy resources.

Uh, we think this is a great package, and we are thankful for uh city council's leadership in considering this.

Thank you.

Thank you, Blair Beekman.

Hi, uh Blair Beekman.

Uh hopefully um you can notice if the mic difference from last time, but just using the one mic, and now there's two again.

If you can notice that difference and uh for the audio, reviewing the audio, and we can talk about it later, how to mitigate and uh work on that issue.

Uh, for this item, uh, item six.

Um thank you for this measure.

Uh thank you for what you're uh working towards and its goals.

Um there was uh a point I wanted to make from it if I can get to it here quickly.

Oh, here we go.

Okay, um, yeah, uh wildfire investments is an important concept here in uh San Diego, what we're trying to address with wildfire.

Um I've tried to mention recently it's important we be accountable with our fire wildfire issues.

I think you've made some incredibly decent good strides in the past year.

How to make it a more community-minded process, and um, man, just a reminder that you've been doing that work well, and good luck in that continued effort.

Uh, what uh we do as a local neighborhoods and communities on wildfire prevention and preparedness issues.

Uh, what you've been doing, and to be open to um different points of view, how wildfires take place, and that we can be uh what conversations we couldn't have 10 years ago that were just shockingly oh appalling, um, actually have a degree of truth in them and finding ways to make those safe conversations.

Uh good luck how we can do that.

Thank you.

Thank you.

This concludes in-person public testimony.

We will now move to the virtual queue.

We have three hands raised in the virtual queue, and I've started the five-minute timer.

We will begin with Zoom user.

Please unmute and provide your comments.

You'll have two minutes.

All right, Hector here.

I'd like to comment on number six about lowering the rates.

We can implement the Bureau's plan of taxing the rich.

And let's start out by taxing the rich politicians.

Like Sarah Jacobs makes she has 60 million dollars.

Let's put a water tax on her-like 10% of her pay over a million.

And then Scott Beeters, Scott Peters is worth 600 million dollars, according to Google.

Let's put him like 10%, something every year, man.

We gotta tax those rests.

Now don't Sarah Jacobs is the granddaughter of a Jacobs, billionaire guy.

Don't tax him.

He already finances so many things around.

You don't want to California's driving away all the billionaires.

Elon left.

Everyone's leaving because they don't want to pay these taxes.

So let's get implement that rich guy tax on our own politicians first.

Now, any of you guys are worth more than six million bucks without your house, I would call that rich.

Not counting your house, La Hoy or whatever.

That doesn't count.

I'm talking six million in the bank.

And if you do have that much, you gotta mess up and you gotta pay 10%.

So the water bill, sewer bill, just the general bills.

And uh we gotta this is the this is the thing of the democratic leadership in our state, county, and city.

The democratic leadership is killing us.

They're making up all these laws, they want a taxes here, they're looking for anything to tax.

I'm surprised they don't charge admission there.

City, sit in those chairs.

We could charge like 20 bucks a pop to sit there like a theater.

Yeah, one thing we gotta do too is immediately remove the meters from Dalball Park.

Immediately, none of us wait until the end of the year.

Just go over there and take them out, man.

It's killing us, killing the guys that work there.

Or sweating their jobs.

Thank you.

This concludes your time.

Our next speaker is phone number ending in 870.

Please press star six to unmute and begin.

Did you say two minutes, Natalie?

Yes.

Thank you so much, Joyce and Yata.

Uh this is this is great.

This is positive.

This is just what we need.

Utility, affordability, and accountability.

Yes, uh, Chair over here, for you working with the uh Office of the City Attorney on the resilience.

Uh, let's let's really uh move on this.

And you know, these state bills are great.

Uh I I just they're just they're the right move.

And and thank you ahead of time, if not already, to the government our government affairs uh department, both the inside and the outside parties that make these things happen on the state level.

So uh blessings on that.

And uh, Chair Elo Rivera, I like the two words you used on that last item, which I think also involved legislate legislation, creativity and persistence.

Those are two really really great words, and uh so thank you for those words are transformative, as you said uh way back.

Uh now uh recently I quoted uh a public person with a Churchill uh quote.

I've edited it, but Churchill said in regards to arts funding, then what are we fighting for?

Then what are we fighting for?

That's why I'm on this bandwagon uh from council member Pro Tem Lee to get a vision for our city.

We want to know what we're fighting for at a core level that pertains to absolutely every choice we make, and that will require creativity and persistence, Chair Elo Rivera.

And and you're bold, and you roar, let's keep doing that and make these things happen.

We need a vision.

What city are we trying to be, Chair Elo Rivera?

Great question.

Love to all.

Thank you.

Our next speaker, Serena Pelka, please unmute and begin.

Hi, good afternoon.

This is Serena Polka from Climate Action Campaign, where we're fighting for a clean, healthy, and affordable future for everyone.

And we're here today in strong support of this resolution.

Firstly, I wanted to thank uh thank you for bringing this item forward and for continuing to prioritize solutions that will bring relief to San Diego families struggling under the high cost of living.

Um we do that through improving quality of life and reducing rates is one of the key steps to do so.

So, in order to reduce the burden our communities face from skyrocketing energy bills, we need to tackle this challenge from all angles.

And this set of state legislation does that.

Combining these bills really take the approach that we need for real rate relief benefits to reach San Diego and build off the progress of last year's legislative session.

As we know, SDGE makes nearly a billion dollars a year in profit with very few quant consequences from regulators as they exceed their rate of return.

While a quarter of our neighbors are behind on their energy bills.

And I think all of us in the room have friends, family, loved ones, neighbors who who have expressed their concern.

I've had neighbors in tears to me over their SCGE bills.

This is not uncommon.

And so, as California's second largest city, we've seen the impact we can have when we use our power in Sacramento.

And so I want to say thank you for letting San Diego families know that you're fighting for us and continuing the momentum to make sure that we have clean affordable energy for San Diego families.

Thank you.

Thank you.

And our final speaker in the queue with their hand raised before our five-minute timer concluded is phone number ending in 1697.

Please press star six to unmute and begin your comments.

Hello, my name is Jesse Anderson.

I live in district nine.

I'm calling today to voice my strong support for this resolution, supporting Senate and Assembly bills addressing utility affordability.

Um utility rates in this city have gotten completely out of control.

I know many who are having to choose between affording their rent and their utility bills.

Unsure if they can get food on the table for their families.

It has become a serious problem that needs to be addressed.

I believe this resolution and these bills are an opportunity to address these problems.

And I hope that our elected in San Diego can be courageous in supporting these bills and doing all they can to rein in the corporate greed of SDGE that is uh siphoning wealth away from San Diego and is forcing families into making impossible decisions in San Diego.

And I just really hope that we will continue to support bills and efforts like this.

Thank you.

Thank you.

And Chair, this concludes public comment on item six.

All right, thank you, Natalie.

Um, we'll begin the conversation with Council President LaCava.

Um, all right, thank you, Chair.

Uh, thank you to Climate Action Campaign, uh, Chair Elo Rivera and the D9 office uh for bringing this forward and continuing our work to support utility affordability to state and local level.

As we've heard over and over and over again, San Diego has one of the highest electricity rates in the nation and increased oversight and accountability at every step and the right setting process can only be the right thing uh to protect affordability uh for the ratepayers.

In the past, we've seen the majority of advocacy on utility and affordability and accountability coming from Los Angeles and the Bay Area.

And with this resolution, the one that council member Ilo Rivera and I led last year, we're giving San Diegans a stronger voice in Sacramento, and certainly thank for everybody who participates in that process.

Um, speaking of last year's resolution, uh, can we get update on the bills that we were supporting last year and whether any of them passed?

I don't know if anybody has an update on that.

I do not know that off the top of my head.

Okay, I wish I did, but that sounds like a I can give an update.

Oh, yeah.

Um, so yeah, I might first start with the fact that the resolution really didn't make a difference last year, including the media that was gartered off of it.

Um, state reps are you know very sensitive to the media uh landscape, and so all that was very much so noticed.

We have inside lobbyists um partners in Sacramento, and they reported back that people were seeing this, it was creating a lot of positive gener uh buzz around the bills.

Um but in terms of the actual bills, we supported 10 bills in the package last year.

Four of them did not actually make it to the governor's desk.

One of them got vetoed by the governor, and then five were signed into legislation, which is really exciting.

Um, those would be kind of incremental bills, I would say.

A lot of them had to do with just tracking data and reporting.

But one of the I think more consequential bills was SB 254, uh, it was a resiliency wildfire study bill.

And so our team is still deeply engaged on that.

The study was very recently released, and we have provided a lot of input into the report itself via our partners at a statewide coalition.

And so we're very deeply engaged in trying to make sure that the findings of this report center affordability and rate pairs and not just how to continue spending money as usual when it comes to wildfire, because wildfire investments, there's a lot of mismanagement of money there.

So we're trying to keep rate payer funds at the top of that.

Alright.

Thank you for that date, and thank you for that reaffirmation that these efforts, even if it's only a resolution, really do make a difference in the conversations that happen in Sacramento and that we down here in San Diego remind Sacramento that we're here too and pay those high very high rates at our constituents need relief in a serious, serious way.

So with that, I'll close my comments and I will move the recommendation.

All right.

Thank you, Council President.

Thank you so much, Cherry La Rivera.

Thank you so much for the presentation.

It's really excellent.

I'm sure we all agree that $313 average monthly bill for electricity in San Diego is ridiculous.

We live in the climate capital of the United States.

We have the best climate anywhere.

We rarely have cold days.

And I just I'm just so glad you've brought this forward.

Thank you so much for that.

I have a couple of questions.

First of all, I want to start with asking you about these current bills that you've mentioned.

Are any of them still being considered in legislature?

I know over the last few weeks, things have gone through committee, et cetera.

Yeah, we've been deeply tracking the bills as they go through preparations and the committees.

This current list is all active.

Okay.

I do have um total agree with most of this.

I have a few questions about Senate Bill 905, which hopefully you can answer.

First of all, I didn't realize that utilities were allowed to make a profit on wildfire investments.

How does that work?

Is that just net profit versus costs of service or costs to put in that?

Yeah.

Yeah, how does that work?

Um I might zoom out one step and explain like the general business model for profit for an IOU.

It's essentially the more they build, the more they profit, and the more we pay into those profits as ratepayers.

It's very simply put, it's a very complicated process.

One layer deeper is that the uh IOUs are granted a quote unquote rate of return, and that is granted by the CPUC, and a rate of return is essentially their profit margin for any project they build.

Um so obviously the more they build and the more expensive that project is, uh the more they're gonna profit, and so they really choose a gold plate.

Um, any kind of infrastructure project they can so they can make uh the most profit, even if it's not cost effective for ratepayers.

So when it comes to wildfire projects, you can think of like undergrounding as maybe the most expensive solution that takes many years to implement.

Um, and we care about wildfire mitigation, obviously, but there are always gonna be cheaper solutions and also solutions that can be delivered much quicker than undergrounding projects, and so that's like one way they're profiting off of wildfire mitigation investments.

So it's not a matter of their costs and expenses as a business that they decide to invest to help decrease wildfire problems, such as there are huge uh cameras throughout the county, which we really appreciate, and how hard they work with the fire departments.

But it's not them taking that expense off as their revenue and then paying less taxes or anything like that, it's more actually they receive revenue for doing these investments.

Yeah, so like Wall Street will front the cost of a big uh invest uh capital project like wildfire investments, um, and then rate pairs slowly pay that pay that back over time, in addition to that rate of return, that profit margin I mentioned earlier, and for SDG needs a little over 10%.

So they were always guaranteed that 10% rate of return on every project they build.

Yeah, that seems backwards.

Um, I had another question about options for low-cost public financing of capital projects.

And if this is a an independent operator of a utility in IOU, as you mentioned, these are commercial uh entities that are privately owned, oftentimes publicly owned because of stockholders, but to have low-cost public financing to help them with their capital investments.

That sounds to me like the wrong direction of the public paying for their investments.

So that could come from bonds, it can come from different kind of public um financing options.

Uh ultimately that provisions designed to protect the rate pair at the end of the day.

Um, and I'm happy to dive into more details and get back to you with like the most current um provision details, too.

If you'd like, okay, we can we can take that offline for later.

Yeah.

And then um the last one I have a question about on the 905, tying executive pay to reducing rate increases and improving grid capacity.

That is one where I wonder about the legalities of the government involving itself in details of a private corporations method of uh salarying its employees, although I understand that this is just um something that will be going to the city attorney's office and our energy experts there will uh be able to look into all the details of what's what's legal and what isn't, but um I would highly suggest to the executives of these private companies that they need to look at the amount of tremendous compensation they give to their most high executives.

Uh it's outrageous.

And I I don't know why anyone would need to have that much to live on a yearly basis.

Uh it's just and the public frankly is getting sick of it.

And so I'm really grateful that these bills are coming and that you have brought this forward for the council to make a recommendation, and uh I would like to second the motion, and I'm in favor.

Thank you so much.

Thank you.

Thank you so much, uh Vice Chair Campbell.

Um thank you for the work on this.

Uh, Deanna, thank you.

Um, I appreciate your work on this.

Uh Anthony, you and the climate action campaign uh team.

Um, and I want to thank Council President for um bringing this this forward last year.

Um glad to hear that Anthony's got the the um the um must make you very popular parties to know off the top of your head um what the outcome of state legislation uh regulating public utility or uh regulating utilities was.

Um I don't have that skill, I'm jealous.

Um so uh congratulations on that.

Um but uh this I I do think this is important for San Diego to do, and I'm glad I'm glad we're we're doing it, and I'm glad the council president got us started in this direction.

Um look, the the it's been said by my colleagues, and I'll just repeat it.

Um, this is a huge issue.

Um, and I'm I'm really glad that we're doing this.

Uh as we keep hearing, San Diegans are paying the highest energy rates in the country, and oftentimes it's Sacramento and the rules made in Sacramento that are the barrier between uh what rates are and what those of us on the on the council um and definitely what everyday people um think they should be, and we should be on the record backing legislation that addresses that.

Um council uh councilmember Campbell, thank you for for raising the issue around um executive pay.

SEPRA's CEO made 21.5 million dollars uh I believe last year, the last year on record, and that's a hundred and seventy-two times what the typical SEMPRA employee earns.

That's the parent company of STGE.

So when SCGE comes to the CPUC asking for another rate increase, uh the financial reality behind that request is that it's that 21.5 million dollar salary, it's that disparity of 172 times uh what the typical SEPRA employee earns, and that's not okay.

And let's be clear, Semper's not a one-off there.

Investor-owned utilities across the country took home over a half billion dollars in 2024, and the next year, CEO paid jumped another 16%.

So what we're seeing is that rates go up, executive pay goes up, and shareholder dividends go up, and the only thing that is not uh going up is the quality of life for residents who are paying those bills.

So this is really important.

Um, and we know that utilities will say executive pay comes from shareholders, not from ratepayers.

That's a technicality, that's all that is.

The cost of capital, the authorized rate of return, profit margins are built into the rate case, and that all comes from the bills that our constituents pay.

So I hear you um uh Councilman McCampbell on questioning, you know, what it looks like to have government you know interject itself in terms of what um a an employee can earn.

Um, but what we're what we're seeing is is that um quite quite clearly um they're not willing to regulate themselves or control themselves.

Um there is an appetite for profit and for um for wealth that is insatiable.

Um, and what we're dealing with are monopolies in in the literal sense that were granted that monop monopoly or excuse me, granted that monopoly by the state uh on the promise that they they'd serve the public interest.

And that deal is supposed to cut both ways.

So when a company is not willing to restrain itself, um, I think government has a not just a right but a responsibility to step in, and uh I'm glad that we're doing that.

Um so um thank you again for the work here.

I'll go back to you, Vice Chair.

Yeah, I just wanted to say it's the California Public Utilities Commission that is in charge of setting the rates for these privately owned utilities, and it is a completely different set of rules for the independent ones, such as the San Diego Community Power.

So don't blame San Diego Community Power.

Uh these these people uh on the CPUC are supposed to have the best benefit of the consumers as their top most important thing when they take into consideration these rate increases, and for years they have not.

And so public, let's get mad at them too, and let's make darn sure that we get this straight now because it is so unfair and uh unequal.

Thank you.

Thank you.

I um generous version of of why CPUC does what it does is that you know you want technical experts in the room to make these sort of decisions, a more cynical um view of why it exists is to detach accountability from those people making decisions um from um the the voters, and um there is a comfort that um that exists in being um detached from voter accountability um that I think is has played itself out in terms of the the continuous approval of of increased rates.

Um and it isn't just a you know uh it isn't just something that occurs uh in terms of setting our utility uh rates, but even the the free-for-all that we see with some of the uh the tech companies that are running our um our rideshare companies um incredible, incredible profits, very little regulation, and it's required enormous effort from state legislators state legislators uh to rein that in even a little bit.

So I'm glad we're doing this.

I'm glad that we're we're tackling this way.

I'm glad that San Diego is moving towards speaking with a unified voice on this legislation.

Um, and um obviously we'll be supportive of the motion.

It'd be very awkward if I did not.

With that, it does make me confident that we can do a voice vote for this one.

Uh all those in favor, please say aye.

Aye.

And that passes unanimously and will bring us to our next and final item on the agenda, item eight.

Natalie, if you'd please introduce that item.

Item eight, city provided residential solid waste management services implementation update.

Chair.

Thank you so much.

All right.

Um, once our presenters are ready, please introduce yourself for the record and let us know how much time you'd like for this item.

Good afternoon, Chair.

My name's Jeremy Bauer.

I'm assisting director of my departmental services department.

Sorry about that.

Good afternoon, Chair.

Jeremy Bauer, Assistant Director, Environmental Services Department.

I'm joined today with Rosa Alena Enriquez of our Measure B team.

And I'll note also in the room are Director Kirby Brady of Environmental Services and Deputy Director Sarah Sims of Collections.

And we've request please 12 minutes today for the presentation.

Thank you.

Please proceed.

Thank you.

Next slide.

Before our staff gets started, uh, this is Randy Wilde, Senior Policy Advisor with Mayor Todd and Gloria.

I just wanted to chime in very quickly.

Um, I think referenced by several of the committee members earlier, but uh just for the public's awareness.

Uh, today's agenda items from the environmental services department were prepared prior to yesterday's closed session actions uh related to a settlement impacting waste collection fees.

Uh the materials presented will not fully reflect the future operational and fiscal impacts of yesterday's actions.

Um more information on those long-term impacts will be available after further analysis and consideration.

However, yesterday's actions do not immediately change the items before you today in terms of the department's update on current waste collection services they'll be providing momentarily or the previous item advancing the process to implement fiscal year 2027 waste collection fees through property tax bills.

Thank you.

Thank you, Randy.

All right, please proceed with the presentation.

Thank you, Chair.

So today we'll just provide some brief background on where we got how we got to today.

Talk about the container rollout, where we are now, the customer portal that we created for our customers.

Uh a great success story, our financial assistance program.

I'm excited to tell you about that, our continued outreach and engagement, and upcoming program developments, as well as an update on our enterprise fund outlook and some next steps.

So, as we all know today, uh Environmental Services Department provides weekly trash and weekly organics collection from our eligible customers and biweekly collection of recycling.

Following the passage of measure B in 2022, the city removed a long-standing prohibition that had been a place that prevented the city from charging a fee for those services.

Following a year of public outreach and engagement and the development of a cost of service study, the city adopted a solid waste management fee last June that went into effect in July.

And now the services previously primarily funded by the general fund are now covered primarily by rate rates paid by our customers.

So we are well underway with our new container rollout.

And I'll start with this, just uh re-explain the primary reason for the new containers.

The fee that we're charging is based on the size of trash containers and the number of additional containers each customer has in order to ensure that we're providing service only to eligible customers, and that we're provide providing it at the service packages they've selected, and also recognizing that most of the old containers were well beyond their useful life.

The city made the determination that the most efficient means to verify our customers and ensure we're only providing service accurately to eligible customers at the right service level was to replace the old containers.

Importantly, we were deliberate in ensuring that we were collecting the old containers and recycling them to ensure that those materials are put back into the materials stream.

This graphic shows the progress on the container rollout.

You'll see on the left, the delivery of the new gray trash containers was largely completed by the end of April.

We're at over 99.8% complete with the new trash containers.

There's some stragglers for finishing.

On the blue recycling containers, we began that in March.

You can see the teal is the actual and the light blue is the projected.

So you'll see that's projected to be done by September.

In mid-July, we launched a customer portal for our customers to be able to select their new containers prior to the delivery of the new containers, but also ongoing allows them to view over time fees that are charged to their property, service levels, changes made under their account, and over time, they can track changes and past fees they've made.

Additionally, they're able to make donations to our financial assistance program through the portal, which I'll talk about in a moment.

And as well, they can sign up for text and email alerts to receive communication directly from the department.

As of now, around 54% of customers have created portal accounts.

It's not required, they can still either contact us via phone to let us know what containers they'd like.

Additionally, if they opted for the standard package of 195 gallon trash, 195 gallon recycling, and 195 gallon organics, they didn't have to do anything, they would receive that by default.

With that said, we do continue to encourage customers to create portal accounts.

As I mentioned, there are benefits.

They can engage in self-service to order replacement or repairs to their containers, they can see their container and fee history, and they can sign up for text and email alerts.

So financial assistance, this is a real success story, and I'll recognize there are two representatives from MAC here within the room with us today.

The city in January entered into a partnership with MAC to administer the financial assistance program.

And I'll mention that throughout the year of outreach and engagement leading up to the adoption of the fee, we consistently heard from residents that were concerned about a fee, and we let them know the city's plan was to develop a financial assistance program.

So it was quite meaningful to be able to follow through on that commitment and in January of this year to launch the program.

We received sufficient funding from the city to support up to 7,000 customers.

And as of the April 30th deadline for assistance towards the first year, the fiscal year 26 fee, we received almost 4,000 applications, and MAC is currently reviewing those.

As of now, I believe around 1,800 have been fully approved, and they'll continue to go through that queue.

We're still accepting applications now for assistance towards the fiscal year 27 fee.

The criteria were based on either income.

So if the household was at 60% or less state medium income, or as a proxy, if a member of the household was currently enrolled in Medi-Cal, Calfresh, Calworks, or the low-income home energy assistance program, they would also qualify for the program.

Looking forward to FY27, we're excited to know that the current draft budget includes funding to continue this program.

As well, customers have pledged more than $62,000 towards the program to help their neighbors.

If a member of a household is enrolled in the SDGE care program, that could also be considered as a qualifying criterion.

Also, we'll update the income requirements to 2,027.

Streamline reenrollment, we are looking at if someone qualified for the first year, as long as they're still the owner and still meet the criteria, they could qualify automatically for a second year.

If they meet the criterion for the first time in fiscal year 27, looking forward to FY28, if they continue to be the owner of the property and continue to meet the criteria, they could qualify by default.

For the first year, we provided the assistance in the form of more of a rebate.

So either a check or a direct deposit.

Looking forward to next year, the plan is to know before August 10th.

Most of the customers that qualify and to pre-apply the assistance so that the fee they see on their county tax bill will already be reduced.

After the August 10th deadline, if funding remains, we'll continue to consider applications on rolling basis and at that point provide assistance in the form of a rebate once again.

And as with the prior year, assistance will continue to be considered on a first come first base basis as funding less.

MAC engaged in uh in-person clinics to assist customers to apply through the program.

The application is an online portal, so they were able to provide that in-person support.

Additionally, for our part, it was important for the department to continue to be accessible to residents.

And as we've received invitations from community planning group meetings, town councils, other community groups, we have been able to fulfill those invitations.

And to date, we've been present at 17 community meetings, reaching around 420 residents.

We'll plan to uh the and the updates have been similar to the update you're receiving here today.

As well, Mac will continue to plan to do in-person clinics next year.

Uh upcoming program developments, we will be doing our waste reduction division will be engaged in route reviews.

Under the city's regulations, it's important that each customer has sufficient containers to hold the volume of trash and recycling they produce between collections.

And so they'll be looking out for overflowing containers and providing support to residents to help them if their containers are overflowing, how to order more containers to ensure that they have sufficient space.

Also, we'll be testing the technology for the RFID readers.

As we've mentioned, all new containers come equipped with RFIDs embedded in them.

What we need to test are the physical scanners that will be attached to trucks, and then those will automatically detect when a container is picked up, and that operational data will allow us to engage in continuous improvement.

The next two, uh I want to highlight the dark red bold language, and this is uh per Randy's Randy's comments.

Plans to launch a weekly recycling and a bulky item program, they are subject to change pending fee revisions under consideration by the city.

So I'll I'll just note uh as of the original plan was by July 1, 2027 to launch a weekly recycling program and a curbside bulky item pickup program.

And I'll just reiterate again, those plans are subject to change pending revisions.

Next slide, please.

I'll make the same caveat for this five this uh this new outlook on the fund.

This is a brand new enterprise fund, and there has been some discussion on deviations from the original estimates on revenue and what we're seeing now.

And I'll make two notes.

In recent weeks, we have seen updates to the customer subscriptions, particularly customers following up with us to indicate they need more additional containers than they had originally told us.

And with that, we've been able to update our revenue projections in a much more positive light, as well.

Now that we have actual numbers on our expenditures and our revenues, we've been able to update our five-year forecast.

As of the current status quo, you'll see we are currently projecting a positive balance by fiscal year 29 with a balance in the reserve fund, and that continuing to increase the following two years.

Again, these are subject to change pending fee revisions, and the department will update these as those decisions are made by the city.

So next steps, uh, pursuant to the item on consent on tax role billing.

Our plan would be to come before city council on June 23rd to present a report of each customer and the amount of fee they'll be charged in FY27 on their tax bill.

As well, between May and August, MAC will review applications to make decisions on assistance towards the FY27 fee.

By August 10th, the department will send to the county the final list of customers and the amount they'll be charged for FY27.

I will note even after August 10th, the city does retain the ability if a customer lets the city know that there was an error, we always have the ability to reduce the fee after August 10th.

And then lastly, between May and September, we'll continue the new recycling container rollout.

And with that, I'm happy to take questions.

Thank you so much, Jamie.

Um you have public comment on this item.

Thank you, Chair.

Yes, the public.

Oh, there's some IBA comments.

Yeah.

We can come.

Yeah, yeah.

No problem.

Again, Jordan Moore from the office of the IBA.

First, we would like to acknowledge the achievements and the hard work of the environmental services department in rolling out the new programs that were part of the first ever effort to turn collection services into a fee collecting utility.

Including what you heard today, the updating of billing systems, bin rollouts, customer service supports, and the financial assistance program.

These combined efforts, along with the other massive responsibilities of the department, have been a major lift that should be commended.

Second, our comments will focus on one of the last slides in the presentation today, which is the solid waste management fund outlook.

As we noted in our analysis of the proposed budget, the solid waste management fund is currently projecting to end fiscal year 2027 with a deficit, which is a deviation from the cost of service study.

Well, we appreciate the department bringing forward data that showed a path back the positive fund balance prior to the recent actions taken yesterday.

Those actions and this presentation we believe provide further reasons for environmental services and solid waste and the solid waste management fund to now be part of the city's various five-year financial outlook processes.

As the council is aware, both the general fund and the public utilities department funds produce a five-year outlook every year, which is of great assistance to the council, mayor, and public and financial planning for the upcoming budget and future years.

In particular, the PUD outlook also provides the council and public with a preview of when and to what extent future rate increases will be needed for both the water and sewer systems, as well as help plan for future service changes and how those changes may impact rates.

Given the changes that collection services will be going through over the next couple of years, and especially now that there is a general fund component to the solid waste management fund, environmental services should also produce a five-year outlook every year to project where rates or service changes may need to occur in the future.

This will provide more transparency to the council and public ahead of any future potential cost of service study to adjust rates in the future, as well as help with general fund forecasts until the solid waste management fund can become self-sustaining again.

This we recognize that this could require a change to council policy is 000-02, which currently requires five-year outlooks for the general fund, PUD funds, and CIP.

If council desires, our office is willing to assist in updating that council policy to require a solid waste management fund outlook as well.

Thank you, and I'm available for any questions.

Thank you, Jordan.

All right.

Let's now hear public comment.

Thank you, Chair.

The public comment period for item eight is now open, and we have received one speaker slip here in the committee room.

Blair Beekman, please approach the lecture.

You'll have two minutes to speak to item eight.

Hi, uh Blair Beekman.

Thanks for this item.

Um I guess um first uh uh thank you that uh I hope uh good work on the previous item, really nice to hear, and that how it can be serving in whatever way uh public power.

Good luck in that effort.

Uh thank you that on this item and a reminder that uh there is a lot of mayor staff who usually are at council and committee meetings, and it's nice for that.

I think I hope they can be more regularly acknowledged as they have a part in this process as well, and they're here, they're participating, and that's good to know.

Um for this item.

Um I wish I better knew uh, you know, the the different rate issues that are going on.

Um, but there's been a lot of consternation and questioning of it.

I know that I I can handle the tech accountability aspects of all this new uh garbage bins being placed and stuff, and what exactly that um can be about, I think it's important.

Um, how we work our tech accountability with new storage bins.

How do we have those conversations openly, and that it can be okay to have those conversations openly.

I hope that effort is also being made uh by the public in these new uh trash uh bin items.

And um, you know, it's been extraordinary, it's been an extraordinary week what we have been going through.

Uh overwhelming in some ways.

I mean, we've had uh terrible events from Monday, and then on the opposite end of the spectrum, these really interesting events that have developed around parking and the garbage issues that uh I thank you immensely about and why I mentioned uh the acceleration issues at the beginning uh the of the meeting today, as just a frame of reference and knowledge that as weird things happen, we can have explanations to uh understand our best practices at this time and what we want to do well and positively.

Uh thank you.

And thank you to Joyce Sinana for all her words and work.

Thank you.

This concludes in-person public testimony.

We will now move to the virtual queue.

There is one hand raised in the virtual queue.

Phone number ending in 870.

Please press star six and begin.

You'll have two minutes.

Thank you, uh Joy Sonyata.

Uh, first of all, uh thank you, Randy Wilde from the Mayor's office for your clarification on this item.

That was very, very important for me to hear.

So uh thank you.

Kudos on that.

Uh I do have a batch of thank yous.

Uh, but I want to start out by uh Kirby Grady.

I understand you're in the room, goody-goody.

Uh first, I know you might not be able to answer this, but first a question.

Are you using qualitative and quantitative metrics as this program unfolds?

You taught me about qualitative and quantitative a long time ago, and I'm starting to want to implement it.

So uh just putting that out there for you.

Okay, so thank you to excellent presentation.

Uh thank you to less impact on the general fund.

Thank you for recycling the old containers.

A little question on that.

Where does any revenue go?

Maybe it's the same company that sells the new ones to us and then we recycled them.

But I wondered about where that money goes, maybe into the general fund.

Uh, thank you for the customer portal.

Thank you for the financial assistance program, big time.

Big thank you on that.

And Jordan Moore, wow, you said it so beautifully when you uh had that strong statement about the environmental services team and their work uh through all this time on you know the whole process.

You've just said it very beautifully, uh Jordan.

Um you're just a wonderful gem in the uh office of the IBA.

Love to all, thank you.

Thank you.

And Chair, this concludes public comment on item eight.

Thank you, Natalie.

Uh, let's begin the conversation with Council President Locava.

Uh thank you, Chair.

Uh thank you, Jeremy and the entire environmental service team for the update today.

Uh as Randy mentioned, and Jerry, you also touched on there was a significant announcement yesterday that will ultimately reduce collection rates in FY 2028.

Uh those reductions may come at the cost of future services.

There will be a lot more discussion on this in the upcoming weeks and months, and so I won't really talk much more about that.

But thank you for flagging that in the presentation, and thank you, Randy, for uh reminding us all of that.

Um I was just sitting here and thinking uh, Chair uh 2022 and Measure B seems such a long time ago.

Uh but it is remarkable that once um that measure did in fact pass by the vote of of Sandiegans, uh, was validated that it really did pass, uh, and that work began that what I really want to focus on uh my comments on and and uh Jordan kind of touched on it is just what an amazing amount of work.

There's been a lot of noise, been a lot of complaints, a lot of rhetoric out there, but I do not want it to ever get lost of the amazing work that everyone at ESD did, starting from scratch, the first time ever that the city of San Diego started charging for trash collection in our residential neighborhoods.

Um and you know, you talked a little bit about that, but I kind of want to repeat to remind ourselves, you know, the cost of service study for the first time we ever what trash collection would mean in this city.

The customer portal, which I just logged into to kind of see how that's that's looking.

Uh the amazing rollout, what 250,000 bins uh of the trash, the new gray bins.

Um now you're starting the rollout of the new recycling bins.

I think I'm up in June, is when mine's predicted to be.

Also talked about transitioning the customers to and from city service.

Uh the city of transitioning those properties that really never were eligible for city collection uh and helping them get to uh from city services that they've gotten in the past and on to private haulers.

And I are we at 100% there, 98.19.

That's not that's not bad.

Um, and I know a lot of that was also the private haulers that were in a lot of ways very reluctant or really weren't equipped uh to be able to do that, um, didn't have the bins, didn't have the trucks that could empty um bins.

Uh my uh my daughter got particularly nervous, but eventually uh her and uh her neighbors um on that property eventually were able to connect with where disposal and it's going quite smoothly and then as you mentioned uh really one of the things I don't think gets nearly enough attention is the financial assistance program uh that I think we all realized uh and you know, tagging on to you, uh chair, uh, when we talk about trying to develop financial assistance for water, um, we understood that from the get-go that these costs were not insignificant.

Um I think we also understood that some people would never understand the portal and opt for the smallest bin, which probably would have served them well and got the default there.

Um, but the financial assistance program um is is such a huge uh win um for this for those that are most vulnerable.

So again, I see Kirby sitting back there, but uh Jeremy and all of you at ESD uh for the extraordinary work uh and all city employees.

I think the cost of service study was done on the outside is traditionally we do, but all the good work to make that happen.

We can't thank you enough for the good work.

Um, you know, I think everybody was very excited about the um settlement, and uh as I mentioned during closed session, I don't know how many different spreadsheets you've done to calculate different rates uh from back in the day when we did the first cost of study, and then we kind of pushed you to try to drive the rates down further.

Um, and then now this will create and then the ones you did while we were talking about a possible settlement.

So uh, you know, thank you for everybody that was uh involved in that.

Uh we're so fortunate to have you.

And then a quick shout out to our partners at MAC uh for the community engagement and getting that word out for the financial assistance program.

Um, you know, I think that's really the key.

It's one thing to say we're gonna do it, it's one thing to budget for it, but to actually get it to roll out and helping um good people.

Um, and I think I heard what 4,000 have signed up, and then there's a vetting process, but it's it's just so so good to hear.

So hopefully that good word will spread out further.

So and if I'm not mistaken, I think it's in this year's budget or the for FY27 budget.

So a big thanks.

I think that's really the important thing for this moment, so for all of you.

Thank you, Chair.

That concludes my comments.

Thank you, Council President.

Uh Vice Chair Campbell.

Thank you.

I I agree with everything you just said.

I want to say ditto.

I want to say Kirby Brady, everything you get involved with for our city.

Turns out to be so magical and wonderful.

I can't thank you enough and appreciate it.

And uh I I call you the mother of Panda, but I I don't know if you are the mother of the uh yes.

Anyway, you've been in other departments and done equally beautiful work, and I thank you.

And I want to thank you guys for the presentation, all your hard work.

Um, the environmental services department is one of my all-time favorites.

Thank you, haulers.

Thank you for the people who work for you and their excellent service and their dedication to our city.

Really appreciate it.

And um, thank you for this informational item thank you vice chair um thank you for um the report and and all the work um there's as has been mentioned it's just an enormous undertaking um i think that's been unfortunately not lost by everyone but i think too many folks um in the conversation over the last couple years um it's not just um that we were starting to charge for something it was that we were starting to manage a massive massive system that everyone um depends on in one way or another even if you were not receiving city services um you don't want to be in a city where um this is not being done well and everyone was being impacted in a negative way by the old um the old system both from a financial perspective um and um just the the various ways that we weren't even accounting for I think that one of the one of the things that's really stood out to me over the last couple of years is um how much learning has happened um in building this new system um rec uh the the recognition that there were certain things that weren't being accounted for there are costs being um just kind of absorbed by other departments across the city um there were ways of delivering the service that we weren't even exploring because we couldn't afford to all of that is just an incredible amount of work it's a massive logistical undertaking and and um unfortunately I think it's some many residents in good faith with just you know not knowing necessarily how just how big of a city this is both in terms of numbers and geography um but also some folks operating in bad faith who do know better um oversimplifying what this needed to look like and and so I just want to say thank you for you know just methodically working through this getting us to the point where where we are um Jordan your your role in being there in the room and helping uh make sure that the council has eyes and ears and um that then the numbers that we're hearing uh all check out um all of that has been incredibly important and so um I I know that um generally speaking um public servants uh like yourselves don't get the thanks that you deserve um and that has been especially true on this issue so I just want you all to know that your efforts are very much appreciated um and the city is better off as a result of that um and uh Kirby thank you for your leadership in implementing um all of this council president I'm really glad that you mentioned and that it was part of the presentation the the um the assistance program completely absent from most of the public dialogue about this because I think in the conversation about who the fee could most negatively impact just completely like blown past was the fact that we very intentionally not just uh created but funded a program to protect those people from being negatively impacted by by this implementation um and that's unfortunate but I think it's just a reality of of of politics and um this became very political very quickly um so I I did have one question though for Mac actually if you if if the representatives from Mac don't mind in the interactions when you're explaining what this pro if you want to if you don't mind coming up to the the mic anyone who'd like um is there anything worth us knowing in terms of what the conversations sounds like on the ground level when you're walking folks through what the program is and how to enroll and what eligibility looks like and um yeah like what what are those conversations sound like most of the demographics is elderly families so we uncovered that there's a big need for addressing the digital gap, you know, between using websites and of course then preferring mail-in like feedback.

So that was good to know.

And you know, we implemented those changes.

That's great.

Um my sense has been that when people don't know about this and then learn about it, they're pretty appreciative, and it kind of softens their their position on whether or not this was, you know, the most outrageous um decision ever made by a city, or um, you know, if it's something okay.

I I I I'm not in a position to pay the full thing, but I I appreciate you all thinking about it.

And obviously, um, I don't know, I'm just kind of curious.

Like, what is that interaction look like?

Do folks seem and I this is important for us to know.

Do they seem you know appreciative that the program exists?

Does it change the way that they seem to be thinking about um cost recovery in totality?

Anything that we should we should know about on that front?

Well, we learned a lot from going to the libraries.

Yeah.

So we had a great partnership with the libraries that were set up from our weekly meetings.

We we met up with uh places that had troubles with parking and uh trouble uh being mobile outside the their neighborhood.

So when we went to their neighborhood, they were very appreciative.

That we didn't have them go to a location that was out of their way.

And so the tone was everyone that I attended and we did surveys and we met with with participants in the community.

They were very appreciative of the effort.

And they knew that uh we weren't in control with how they're ended up being a fee.

So they're appreciative of us being out there, answering their questions, hearing them out.

Uh that wasn't always the intention of why that wasn't the intention of why we were there, but they were appreciative that we gave them good customer service, that we were responsive.

A lot of times we're working with family members that were representing their parents.

So the fact that we had different language uh response capabilities was very helpful, and that we made changes and brought it up to the city who were very responsible uh and responsive to our to our questions and concerns, and then shared with them okay, we brought it up and this is what they adjusted to, and this is how it looks now.

So that would that ended up being a very positive impact in the community that we weren't foreseen.

That's that's good to hear.

And I I know that the the I would actually say that there was intent in wanting folks to feel seen, like and their circumstances seen and accounted for.

Um budgeting accordingly to to account for that need.

So thank you for for being out there and doing the work that we have.

I'll I'll just conclude with this.

Uh, another thank you.

And um when we were drafting comments and questions about this item, um, there was a cloud looming over the conversation of the potential defunding, effectively the defunding of the environmental services department, the elimination of cost recovery.

And a you know, there was like really hard questions about like what really important services are going to be cut and how much.

And um, I'm I'm glad that we're not having to have that conversation because um what we were going to need to prepare for was going to be potentially catastrophic for the city, and it would have left us much worse off.

And so um, I just want to say I'm I'm glad that that is not the conversation that we're having today.

Um none of this has been easy, but I definitely think it's been worth it.

And um I'll just conclude with that.

Thank you.

Thank you, Chair.

Thank you.

All right.

Um, so that brings us to the end of our agenda.

Um I'll say thank you to Natalie and members of the public and staff for uh participation today, and we'll adjourn this meeting of the environment committee to the next regularly scheduled meeting on Thursday, June 18th, 2026 at 1 p.m.

Thank you, everyone.

We're adjourned.

Um