San Francisco Public Utilities Commission Meeting – March 12, 2024

The San Francisco Public Utilities Commission (SFPUC) held a regular meeting on March 12, 2024, from approximately 9:30 AM to 12:30 PM. The commission approved a $407 million amendment to the biosolids digester facilities contract, heard updates on the waterfront flood study and power enterprise customer programs, and received the FY 2022-23 audited financial statements with unmodified opinions. Public comment addressed community benefits, power outages, customer assistance program barriers, and the alternative water supply plan.

Consent Calendar

• 6a: Approved a 684‑calendar‑day extension to Contract No. DB‑130 (Bay Corridor Transmission and Distribution) with no change to the contract amount, due to contractor delays including equipment malfunctions, water intrusion, and protection relay system issues. A third‑party consultant is reviewing testing.
• 6b: Approved closeout of Contract No. HH‑1004.C (Master As‑Needed Tree Services‑Hetch Hetchy) with Capax Group, Inc. and authorized final payment of $17,175. The contractor elected to shut down after one task order; three other contractors remain.
• 6c–6f: Approved modifications and awards for contracts related to general engineering construction, HVAC maintenance, sewer replacement, and pipe and plant solutions. All items were approved unanimously (3‑0).

Public Comments & Testimony

• General Public Comment: Francisco de Costa urged the commission to fully utilize the community contracting center (currently open Tuesday–Thursday) and called for an audit of the 5% community benefits set‑aside (targeting $300 million on the first $6 billion in projects).
• Peter Dreckmeyer, policy director for the Tuolumne River Trust, requested a workshop on the alternative water supply plan, noting that full buildout could cost $16–$25 billion and double the SFPUC’s budget. He stated that the plan’s demand projections rely on an “outside envelope” and that actual water use in 2023 was 178 MGD versus a 2020 projection of 216 MGD.
• A caller speaking for her parents reported that the Customer Assistance Program (CAP) required additional income verification for low‑income immigrant applicants, that a letter was sent only in English (not Spanish as the application was submitted), and that months of delay had occurred without a discount.
• Barkley Sanders, a resident of Treasure Island and member of the citizen advisory board, stated that the island has experienced over 487 power outages in 25 years (with outages lasting 2–3 weeks) and called for an emergency authorization to upgrade the grid for current residents.
• On Item 7 (Biosolids Amendment): Two community members criticized the pace of the social impact partnership commitment. One speaker, Attorney Jafferia Morris, urged the commission to delay the vote until Commissioner Sophie Maxwell could attend and demanded increased community benefits, noting that the Black population in District 10 had dropped from 40% to 18%. Another speaker, Francisco de Costa, said his nonprofit had received no funds and called for the contracting center to be open Monday–Friday.

Discussion Items

• 5a. FY 2022‑23 Audited Financial Statements: Nancy Hom, CFO, and Annie Lewey from MGO LLP presented the three audited enterprise statements (water, wastewater, Hetch Hetchy Power, CleanPowerSF). The audits received unmodified opinions with no material misstatements and no internal control deficiencies. One uncorrected misstatement (damage claims liabilities) was noted but deemed immaterial. The annual comprehensive financial report and popular annual financial report were also issued, and the SFPUC has received Government Finance Officers Association awards annually since 2009/2010. Commissioner Stacy commended the transparency and clarity of the reports.
• 5b. San Francisco Waterfront Flood Study Draft Report: Adam Verrett (Port of San Francisco) and Sarah Minick (SFPUC Wastewater) presented the draft plan. The study covers 7.5 miles of waterfront, with a preliminary cost estimate of $13.5 billion. Congress would fund up to 65%. The draft plan proposes a phased approach: non‑structural floodproofing at Fisherman’s Wharf; raising the shoreline to 3.5 feet of sea‑level rise along the Embarcadero; elevated shoreline and vegetated berms in South Beach/Mission Bay; and flood walls, closure structures, and nature‑based features in the southern reaches. The 60‑day public comment period is underway. Commissioners emphasized the need for interagency coordination, public safety (including firefighting water access), and collaboration with national and international experts.
• 5c. Update on Power Enterprise Customer Programs: Daniel Young presented two new programs. The All‑Electric Multifamily program (started Nov. 2023) offers site assessments for affordable housing buildings served by Hetch Hetchy Power; two assessments have been completed. The Electrify My Ride e‑bike program (started Feb. 2024) provides a $1,000 point‑of‑sale discount at local bike shops, limited to customers enrolled in energy assistance programs and living in equity priority communities. The $1 million incentive budget is 50% reserved, with 70+ coupons redeemed in the first month. The first round expires at the end of April 2024. Both programs are revenue‑funded.
• 7. Approve Amendment No. 6 to Contract No. WW‑647R (Biosolids Digester Facilities): Project manager Carolyn Chu requested a $407 million increase (to a total of $2.2 billion) and a 111‑day extension (60 days for additional foundation work, 51 days contingency). All 105 construction packages have been bid out, with procurement occurring during and after COVID. The increase is offset by $107 million in savings from other project elements (e.g., terminated lease, contingency for biogas P3). The overall project completion date remains unchanged. Local hire participation is at 34% (exceeding 30% goal), apprenticeship hours at 61% (exceeding 50%), and LBE participation at 17% (94 firms, $318 million awarded, of which $214 million is from District 10). The social impact partnership commitment of $16 million is not keeping pace, partially attributed to a prior contract pause. The commission approved the amendment unanimously.
• 8. Award Contract No. WW‑750 (Southeast Plant SEP‑7 Operations, Engineering, and Maintenance Buildings): Project manager Shelby Campbell presented the award to Clark Construction for $97 million, with a duration of just under five years. The project will consolidate end‑of‑life facilities, provide direct connection to the biosolids project, and create a neighborhood‑friendly campus edge. The contract is a two‑step CMGC: the commission approved the design/pre‑construction phase; construction approval will return after environmental review completion (approximately one year). Approved unanimously.

Key Outcomes

• Votes: Consent calendar (6a–6f) approved 3‑0. Item 7 (Biosolids amendment) approved 3‑0. Item 8 (WW‑750 contract award) approved 3‑0. Closed session settlements (Item 13: $58,986 to Matthias Sally; Item 14: eight claimants from Fillmore/Green Street water main break) were approved.
• Directives: Commissioners directed staff to provide periodic updates on the waterfront flood study and to continue working with the contractor on the biosolids social impact partnership. The commission will receive a workshop on the alternative water supply plan at a future date.
• Next Steps: The public comment period for the waterfront flood study draft plan is open; a joint city comment letter will be submitted to the U.S. Army Corps of Engineers. The power enterprise programs will be evaluated at the end of April for potential expansion. The biosolids project is expected to reach peak construction in fall 2024.