San Francisco Public Utilities Commission Meeting – May 12, 2026

The San Francisco Public Utilities Commission (SFPUC) held its regular meeting on May 12, 2026, at 9:45 AM. Commissioners present: President Arce, Vice President Leveroni, Commissioner Jamdar, Commissioner Thurlow; Commissioner Stacy was excused. The meeting began with a land acknowledgment of the unceded territory of the Muwekma Ohlone Tribe. Agenda items included approval of minutes, general public comment, quarterly capital program reports, a license agreement with the City of Sunnyvale, three sets of fee revisions, and a contract contingency increase.

Consent Calendar

• Item 3: Approval of Minutes of April 14, 2026 – Approved unanimously (4-0).
• Item 6: Consent Calendar – Three items approved unanimously (4-0) with no discussion.

Public Comments & Testimony

• Item 4 (General Public Comment):
  • Francisco de Costa expressed concern that three reservoirs are filthy and that the city ignores this health issue. He stated that Hetch Hetchy Valley water is holy water and criticized the use of drinking water for flushing toilets, advocating for gradual gray water adoption. He accused the city of corruption and lacking standards.
  • Peter Dreckmeyer, policy director for Yosemite River Galaya, noted that the commission’s correspondence log contained many negative comments, mostly about the combined stormwater system. He warned of an approaching El Niño, possibly the largest on record, and urged the commission to prepare.
• Item 5 (Water Enterprise & Water System Improvement Quarterly Reports): No public comments.
• Item 6 (Consent Calendar): One caller commented, but the content was not detailed in the transcript.
• Items 8, 9, 10 (Fee Revisions): Francisco de Costa returned, criticizing the fee proposals, stating that fired street employees were qualified, and questioning whether the rate manager had done an audit or held community workshops. He complained about slow repairs and high costs for electrical work.
• Item 11 (Contract Contingency Increase): No public comments.

Discussion Items

• Item 5 – Quarterly Reports on Water Enterprise CIP and Water System Improvement Program: Katie Miller, Director of Water Capital Programs, presented a combined update. Water Enterprise CIP spending reached $178 million during the past two quarters, the highest in five years, driven by projects like the Sunol Valley Water Treatment Plant Ozone Project. A table showed cost variances: about half the projects forecast cost increases, while five forecast decreases. Major cost increases included three regional dam projects (Turner, San Andreas, and Pilarcitos Dams) with a combined increase of $1.24 billion, attributed to better understanding of scope during planning. These projects were deferred to years 11–20 of the 20-year CIP to meet affordability and resource constraints. Other increases came from the main replacement project (adding ~$900 million) and the potable emergency firefighting water system (adding ~$500 million over 20 years). Commissioners inquired about the structural work for solar panels on the reservoir roof, the cost escalation factors (4% first 10 years, 3% second 10 years), and the budget variances for water supply/storage and transmission.
• Item 7 – License to City of Sunnyvale: Rosanna Russell, Real Estate Director, presented a no-fee, month-to-month revocable license for the City of Sunnyvale to use approximately 17 acres of SFPUC land for an existing public recreational path. The new license replaces 10 outdated licenses (some dating to 1957) with robust provisions protecting the PUC’s access, requiring written consent for changes, comprehensive indemnity, and CEQA review. Sunnyvale will maintain the path (saving the PUC ~$104,000/year) and install educational signage about the Hetch Hetchy water system. One previously unlicensed parcel was identified and included. Commissioner Thurlow asked about that parcel and liability; Russell clarified. The item passed unanimously.
• Items 8, 9, 10 – Fee Revisions for Water, Wastewater, and Power Enterprises: Matthew Freiberg, Rates Manager, presented three fee packages. He explained that miscellaneous fees are separate from utility rates and are designed to ensure ratepayer equity and incentivize compliance. The methodology uses fully burdened labor costs plus materials; some fees are set below or above cost as a policy matter.
  • Item 8 (Water Enterprise): Four revised fees: temporary hydrant connection ($955), temporary hydrant meter rental deposit (1-inch and 3-inch), hydrant flushing fee, and backflow tag fee. Increases are due to higher staff effort from updated rules and regulations. The backflow tag fee recovers only a fraction of cost due to broader benefits. The item passed unanimously.
  • Item 9 (Wastewater Enterprise): Three new fees for the Stormwater Management Ordinance (SMO) compliance: $500 annual self-certification non-reporting penalty, tiered reinspection fees (50%, 100%, 150% of cost), and an administrative civil penalty of $1,111 per acre per day for noncompliance (capped at $1,000 or $2,000/day). About 40% of SMO customers fail to self-certify; there are 17 notices of violation. Freiberg said the goal is compliance, not revenue, and a grace period will precede enforcement. Rates were based on peer agency comparison and policy judgment. The item passed unanimously.
  • Item 10 (Power Enterprise): Twelve new fees for services previously provided free: streetlight installation (application, site investigation, photometric review, inspection), streetlight shield, municipal pole use (non-banner), new/upgrade/removal of metered service ($3,000), metered service modification ($2,000), rules and regulations variance ($5,000), generator interconnection (low fee to incentivize solar), and gas service request (~$930). Commissioner Jamdar asked about the impact on residential electrification; Freiberg clarified that Hetch Hetchy Power serves mostly municipal and large multifamily customers, not single-family homes. Commissioner Thurlow asked how the discount level for the generator fee was determined; Freiberg said it involved internal discussions and peer benchmarking. The item passed unanimously.
• Item 11 – Contingency Increase for Contract HH1013: Kim McFarland, Project Manager, requested a $500,000 increase to the cost contingency and a 274-day duration extension (new deadline March 30, 2027) for the Moccasin Compound Water System microfiltration unit project. Geotechnical investigation had underestimated bedrock depth, requiring a shift to drilled piers. Additional design modifications arose from the foundation change and Hetch Hetchy requests. Vice President Leveroni asked about the initial geotechnical investigation; McFarland acknowledged it was insufficient and noted that lessons learned include more densified borings in the future. The item passed unanimously.

Key Outcomes

• Votes:
  • Item 3 (Minutes): Approved (4-0).
  • Item 6 (Consent Calendar): Approved (4-0).
  • Item 7 (Sunnyvale License): Approved (4-0).
  • Item 8 (Water Fee Revisions): Approved (4-0).
  • Item 9 (Wastewater Fee Revisions): Approved (4-0).
  • Item 10 (Power Fee Revisions): Approved (4-0).
  • Item 11 (Contract Contingency Increase): Approved (4-0).
• Directives: The commission took note of communications (Item 12) and initiated no new items (Item 13).
• Next Steps: Fee revisions will take effect July 1, 2026, with a grace period for wastewater and power fees to allow for outreach and warning. The general manager will execute the Sunnyvale license. Staff will continue to monitor stormwater ordinance compliance and may adjust fees if noncompliance persists.