San Francisco Public Utilities Commission Regular Meeting – February 8, 2022

On February 8, 2022, the San Francisco Public Utilities Commission (SFPUC) held a regular meeting via teleconference due to the COVID-19 emergency. Commissioners present: President Moran, Vice President Jamy, Commissioner Maxwell, and Commissioner Paulson. The meeting included updates on drought conditions, adoption of the biennial operating budget, capital budget, 10-year capital and financial plans, and several contract awards. All votes were unanimous (4-0).

Consent Calendar

• Item 9: Approved consent calendar en bloc, including three contracts: WD-2882 (Trousdale Oaks Tree Removal, $2,655,026), correction to Resolution No. 21-0082 (Yerba Buena Engineering closeout), and WW-648 (Oceanside Water Pollution Control Plant clarifier improvements, $6,490,014).

Public Comments & Testimony

• Item 5 (General Public Comment):
  • Bill Martin (San Francisco resident, Sierra Club signatory) urged deeper research on alternative water supplies and review of the Long-Term Vulnerability Assessment (LTVA).
  • A caller from Turlock Irrigation District (TID) described Project Nexus (solar panels over canals) and urged the commission to invite TID to present.
  • David Pilpel expressed alarm over the high number of staff vacancies and acting assignments across the commission, urging priority attention.
  • Nicole Sandkulla (BAWSCA CEO) supported using the LTVA for long-term planning and urged adherence to scientific data.
  • Alita Dupree advocated for expanding Clean Power SF, electrification, and a hybrid in-person meeting format.
  • Another caller referenced corruption tied to former SFPUC officials Harlan Kelly and Juliet Ellis, alleging misuse of funds.
• Item 6 (Communications): Commissioner Moran noted the LTVA is dense and requires careful reading to avoid misinterpretation.
• Item 7a (Drought Update): No public comments.
• Item 9 (Consent Calendar): No public comments.
• Item 10 (WW712 Increase): David Pilpel praised improved clarity of the item and expressed support.
• Item 12 (Tree Services): A caller questioned consultation with indigenous peoples on forest thinning and tree mortality.
• Item 13 (MOU with SFMTA): Eileen Vogen (Coalition for San Francisco Neighborhoods) disputed accuracy of project descriptions regarding pipe sizes and route; David Pilpel requested better mapping and explanation of cost-sharing timing. A final caller urged fact-checking by presenters.
• Items 14-17 (Budget): Eileen Vogen urged specific capital plan amendments; David Pilpel stressed focusing on people infrastructure, expressed concern over rate freeze effects, and requested responses to earlier written comments.

Discussion Items

• Item 3: Renewed Remote Meeting Findings – Unanimously adopted for another 30 days.
• Item 4: Approval of Minutes – Minutes for January 14, 20, and 25 were approved individually (all 4-0) after David Pilpel indicated edits may be submitted later.
• Item 6: Communications – Commissioners discussed a letter from NGOs (Sierra Club et al.) regarding the LTVA; President Moran urged careful interpretation of the report.
• Item 7a: Drought Conditions Update (Steve Ritchie, AGM Water) – Key statistics: Hetch Hetchy Reservoir at 300,000 acre-feet (likely to fill); Cherry Reservoir at 240,000 acre-feet (being drawn down to 220,000 for snowmelt). January was the driest on record at Hetch Hetchy (0.06 inches precipitation). Combined water demand reduction since July 1, 2021: San Francisco 15%, wholesale 6%, average 9%. Snowpack is near median but dry February forecast. Total water available to city: 127,000 acre-feet.
• Item 10: Contract Increase for WW-712 (Bessie Tam) – Request to add $2,250,000 and 180 calendar days to rehabilitate deteriorated brick sewers north of Market Street (within one mile of original project). The contractor preliminarily agreed to uphold competitively bid prices. Commissioners praised clear presentation; concerns about prior noticing issues resolved. Passed 4-0.
• Item 11: Elevator Maintenance Contract (WW-718R) – Award to Star Elevator Inc. for $2,136,677 over 1,125 days. Passed 4-0.
• Item 12: Master As-Needed Tree Services Contracts – Five contracts, each $10 million not-to-exceed, total combined spending authority $10 million. To address dead/dying trees due to drought and pathogens. Tim Ramirez (Natural Resources) noted continued collaboration with Muwekma Ohlone tribe on land management. Passed 4-0.
• Item 13: MOU with SFMTA for Taraval Street Water/Sewer Relocation – Authorizes GM to execute MOU with SFMTA; total estimated SFPUC cost $33,760,678. Bessie Tam noted this is segment B of ongoing successful joint project (segment A completed). Commissioners requested maps and clearer public information. Passed 4-0.
• Items 14-17: Budget Adoption (Presented by GM Herrera, Laura Bush, Charles Pearl)
  • Item 14: Biennial Operating Budget (FY 2022-23 and 2023-24) – $1.6 billion annually. No retail rate increases for water and wastewater. Budget grows 8% in first year, 3% in second. Driver: power purchase and debt service. 58 net new positions (37 project-funded, 21 operating). Key priorities: responsible management, access/affordability, people/communities.
  • Item 15: Capital Budget (FY 2022-23) – $1,117,521,515 including financing costs. Largest portion: wastewater (70%), water ($101.3M), upcountry water/power ($114.9M), in-city power ($66.2M), Clean Power SF ($1.6M).
  • Item 16: 10-Year Capital Plan (FY 2022-23 – 2031-32) – Total $9,893,091,608 (increase of 9% from prior plan). Wastewater (SSIP) is two-thirds. About 13% unfunded; staff to work on aligning plan with delivery capacity.
  • Item 17: 10-Year Financial Plan – Average annual rate increases: water retail 2.1%, wholesale 3.6%; wastewater 5.2%; Hetch Hetchy power 5.2% (with planned rate increases from general fund); Clean Power SF stable. All financial policy metrics met (fund balance >25%, debt coverage >1.1x). Customer bill projection: $139/month currently to ~$204 by 2032 (4.7% annual growth). Affordability metric review planned for later in 2022.
  • Public comment raised concerns about staff vacancies, unbalanced capital program, and specific project amendments. Commissioners approved each item individually (all 4-0).
• Item 20: Closed Session – Discussion of settlement in David Alfaro et al. vs. City & County of SF (flooding lawsuit) for $3,626,440.85 in attorney fees and costs. Motion passed to assert attorney-client privilege. After closed session, motion not to disclose discussions.

Key Outcomes

• Item 3: Unanimously adopted remote meeting findings (4-0).
• Item 4: Minutes for January 14, 20, and 25 approved individually (all 4-0).
• Item 9: Consent calendar approved (4-0).
• Item 10: Contract increase for WW-712 approved (4-0).
• Item 11: Elevator contract awarded to Star Elevator (4-0).
• Item 12: Five tree service contracts awarded (4-0).
• Item 13: MOU with SFMTA authorized (4-0).
• Item 14-17: Operating budget, capital budget, 10-year capital plan, and 10-year financial plan all adopted (each 4-0).
• Item 20 (Closed Session): Commission recommended settlement to Board of Supervisors; motion against disclosure passed (4-0).