Meeting of the San Francisco Public Utilities Commission will now come to order.

Ms.

Lanier, can you please kindly call roll?

President Arcee here.

Vice President Leverone.

Here.

Commissioner Jamdar.

Here.

Commissioner Stacy is excused.

Commissioner Thurlow.

Here.

You have a quorum.

Thank you, Ms.

Lanier.

Before calling the first item, I'd like to announce that the San Francisco Public Utilities Commission acknowledges that it owns and are stewards of the unceded lands located within the ethno-historic territory of the Moekma Alone tribe and other familiar descendants of the historic federally recognized Mission San Jose Verona Band of Alameda County.

The SFPC also recognizes that every citizen residing within the Greater Bay Area has and continues to benefit from the use and occupation of the Moek Maloney tribe's aboriginal lands since before and after the San Francisco Public Utilities Commission's founding in 1932.

It is vitally important that we not only recognize the history of the tribal lands on which we reside, but also we acknowledge and honor the fact that the Mowekma Alone people have established a working partnership with the SFPC and are productive and flourishing members within the many greater San Francisco Bay Area communities today.

Item three, approval of the minutes of April 14, 2026.

Commissioners, are there any corrections to the minutes of April 14th, 2026?

Seeing none, can we please take public comment, Ms.

Lanier?

Remote callers, please raise your hand if you wish to provide comment on item three.

Are there any members of the public who wish to comment?

Seeing none, moderator, are there any callers who have their hand raised?

Miss Lanier, there are no callers with their hands raised.

Thank you.

Motion to approve the minutes.

Motion from Commissioner Jamdar.

Second.

Second from Vice President Leveroni.

President Arce.

Aye.

Vice President Leveroni.

Aye.

Commissioner Jamdar.

Aye.

Commissioner Stacy is excused.

Commissioner Thurlow.

Aye.

Item three passes.

Item four, general public comment.

Members of the public may address the commission on matters that are within the commission's jurisdiction and are not on today's agenda.

Members present who wish to speak are encouraged to complete and submit to the Director of Commission Affairs a speaker's card located on the table to the left of the public gallery seating area.

Please note that members are called to the podium to speak in the same order that cards are received.

Mr.

Francisco de Costa.

Today I'm here.

That we have over three reservoirs that are filthy.

Supposedly containing clean drinking water.

Seems to ignore this fact.

This is a health issue.

The commissioners should remember that the Hatchati Valley was one of the most beautiful valleys, which was damned.

And that water is holy water.

I know this when I go there.

What we do is take this holy water and flush our toilets with it.

And 15 20 years ago, we should have slowly slowly brought about gray water to flush the toilets.

I say this because if you do not respect the indigenous people, and the elders have told us, do not trust those who speak with a fog tongue.

That's what's happening.

I'm not coming here to waste my time.

I'm a very busy man.

Very, very busy man.

But I've taken this case because shame on this city that once had standards, now is killing our people on every level of corruption.

Thank you for your comments.

Moderator, are there any calls who have their hand raised for public comment?

Ms.

Lanier, there is one caller who has their hands raised.

Thank you.

Caller, your line has been unmuted.

You have two minutes.

Thank you.

Good afternoon.

This is Peter Dreckmeyer, policy director for Yosemite River Galaya.

When I served on the Powell of the City Council, it was always so nice to hear from constituents who had a compliment.

Maybe they got good service and they let us know.

And we knew that that represented a lot of people who also got good service, but just didn't take the time to write, and complaints are the same way.

Not everyone takes the time to complain.

They might be more likely to, but complain make an impact.

And in your correspondence log, there were a lot of communications, and unfortunately, most, if not all, were pretty negative.

And a lot of them focused on problems with the combined tour stormwater system.

It's been in the news recently that a big El Nino is brewing, possibly the bigger ever.

And we never know.

Things can change.

But there could be huge challenges this coming fall and winter.

And I really encourage you to do what you can.

Hopefully you'll get some positive feedback from the community and not too much negative.

Thank you.

Thank you for your comment.

Ms.

Lanier, there are no more callers in the queue.

Thank you so much.

Item five, report of the general manager.

Thank you, Ms.

Lanier.

Items uh 5A and 5B will be presented together by Katie Miller.

Uh, one is Water Enterprise Capital Improvement Program Quarterly Report, and the other is Water System Improvement Program quarterly report.

Good afternoon, President Arce and Commissioners.

I'm Katie Miller, Director of Water Capital Programs.

May I have the slides, please?

Today I will provide a combined presentation on items 5A and 5B, update on water enterprise capital improvement program as well as water system improvement program as of the end of the third quarter of this year, this fiscal year, 25-26.

I will start with the water enterprise capital improvement program.

Okay, thank you.

178 million dollars was spent by the projects during the past two quarters, which is the highest spending level the program has experienced in the past five years.

This indicates that many of the projects, such as the Snow Valley Water Treatment Plant Ozone Project, and the San Francisco Water Division headquarters are now in construction and spending at a much higher rate.

This table, similar to table three in the quarterly reports, shows a summary of program expenditures and cost forecasts at the end of March for all active projects projects by category.

The right two columns show cost variances between the 2024 approved budgets and the forecast project budgets, which have been updated and included in the fiscal year 27 to 36 10-year CIP that this commission approved in February.

Note that about half of the projects are forecasting cost increases, while five of the projects forecasted cost decreases.

Some of the major cost increases were due to the three regional dam projects with combined cost increase of 1.24 billion dollars.

Cost increases for the dams projects, as well as several of the other of the projects were primarily due to gaining a better understanding of actual needed scope during the planning phase, and then updating budgets with more realistic construction costs.

Note that while all the combined cost forecasts increased by over $2 billion as shown in this table, the updated 10-year CIP for local and regional water only increased by 250 million dollars over the next 10 years.

This is because many of the projects were deferred so that construction costs occur after the first 10 years, such as for the major dam projects.

This was needed to meet affordability goals as well as deliverability and resource constraints.

This allowed for continuation of many of the smaller projects while also accommodating the necessary cost increases.

This table shows some of the milestones that were achieved during the last quarter.

And as we can see, several of the projects are nearing beginning of construction, and one project completed construction.

Currently, there are nine regional projects in construction.

These photos show significant underground piping work at the Sonola Valley Water Treatment Plant Ozone Facility, improvements at the Sonole Valley Chlorination Chloramination Facility, and finishing touches on the Southern Skyline Boulevard Ridge Trail Extension, which is anticipated to finish next month.

The Sonola Valley and now I'll give you a few project highlights.

The Snow Valley Water Treatment Plant short-term improvements project is well into construction.

And this includes repairs to the flocculation basins, some of which were completed prior to the plant being returned to service to support the Hetch Hetchy winter outage operations.

Critical submittal packages continued to be submitted, and a second partnering meeting was held.

And now I will shift to the local program in San Francisco.

As we can see from this table, several major milestones were completed by the 15 projects in the local program.

This also shows that more projects are nearing construction over the next year.

This will also significantly increase spending in both programs.

And now for a couple of project highlights.

Per our MOU between SFPUC and Daily City, we will reimburse Daily City as construction progresses.

So the budget will be depleted as the invoices come in from the contractor and are approved by SFPUC.

The reservoir roof and tank coatings project also now is in construction.

This scope includes a roof membrane replacement and structural reinforcement so our power enterprise can have future solar panels installed.

And now we'll switch over to the water system improvement program.

The regional water system improvement program consists of uh originally consisted of 52 projects for a total of 3.8 billion dollars and continues to be 99% complete with only $58 million of budget unspent.

There are only four projects remaining, with one project in planning and one in construction.

The regional groundwater storage and recovery project is 91% complete at this time.

For the two remaining construction contracts, the phase 2A contract is now in closeout.

The phase 2B contract, completed in, which will complete installation of the South Sunset Mainwell and pipeline connection to Calwaters facility, started construction with the contractor mobilizing and performing various site work.

There may be some slight delays to this contract due to a conflict between PGE's electrical service conduits and the existing Sunset Supply Pipeline, and we'll report on that in future uh reports.

For the Alameda Creek Recapture Project, planning for a redesign facility is underway, and during the quarter, a draft alternatives analysis report was distributed for review.

And that completes my report.

I'll be happy to take any questions.

Alright, thank you, Ms.

Miller.

Got a question from Vice President Leveroni.

Just sending in on the on the uh reservoir roof and tank coatings.

Um, so that contract is going out.

It's not going to include solar at this time.

Is that correct?

No, the solar will be an independent uh project that is overseen by the power enterprise.

Okay.

So we're just preparing it, putting structural uh members in place so that that will can withstand the weight of the solar facilities.

Okay, so I'm sure there's private um coordination with the solar companies just to see what the weight requirement and structures are going to need to withhold on on the roof.

Yes, that is correct.

Um, on the um is there the bulk of the dollars on this?

Is that going to be in structural work or is it actually the layer of the roofing?

Um that's a very good question.

The uh structural work did add several million dollars uh to the contract.

It was just going to be redoing the membrane, but with the structural work, it became a little bit more expensive.

Okay.

And is this contract a size enough that you would do it as a progressive bid?

Um the roof coating is pretty straightforward, so we're just doing that and not trying to include the solar.

It's very different types of contractors so we're just gonna allow them to be independent.

Okay, and the roofing contractor would be the one that would be doing the structural work also.

That's correct.

Um thank you.

Thank you.

Any other questions?

Commissioner Jamdar.

Thank you for the presentation.

I just had questions about the uh the water enterprise CIP uh cost summary for the the biggest jump in the budget, the approved budget for water supply and storage goes from 139 million to 1.3 billion.

Could you explain that huge jump?

And similarly down the line for the local CIP, there's a similar billion dollar gap.

I'm trying to recollect where that's coming from.

Yes, the water supply and storage projects include the regional dam projects, and that is for Turner Dam, San Andreas Dam, and Pillar Citos Dam.

And those three projects combined went up for a total of 1.24 billion dollars.

So that is the bulk of that cost increase.

We uh postponed the project so that uh the first um project, which is San Andreas Dam, that construction will start in year 11.

And this year we worked very hard with our CIP to plan a 20-year CIP.

So we've as well as we can predict 10 years out, we've balanced the second 10 years to accommodate construction of those three very large projects, which are anywhere between $300 million to $700 million each.

And those came up in the last decade before the 10-year CIP was budgeted for, is that right?

Can you repeat that?

I guess I'm just thinking about the cost variation.

Yes, because we really did not know what we needed to do with those and what the magnitude of cost was going to be.

So we just budgeted in the past CIPs for planning and design, which was about $30 million per project.

So we're only holding about $90 million in the budget for those projects, knowing that this big increase was going to come.

Uh, I think it was larger than any of us expected, but not now that we know what the cost really is and what needs to happen.

It's uh it's warranted.

And this is why we staggered it out to the next 10 years and then over the years so that the cost impact can fit around other projects that also need to get done.

And similarly for the water transmission delta, could you explain what that cost is?

Uh that is primarily a uh kind of a figment of the second 10 years.

So again, we included the second 10 years in the major projects, which is the main replacement project, which added, I think 900 million in the second 10 years, and also the potable emergency firefighting water system, of which water is contributing uh 45%.

And the ECER bonds are contributing the rest.

So we extended that out for 20 years, and that also added about another 500 million.

So that's the bulk of it.

The rest of it are all just our other projects.

Thank you.

Vice President Leveroni.

Just a follow-up question to you, Commissioner.

Um, I'm gonna assume, too, that the present value dollars that we're looking at today, and you carried them out 10 years or five years or whatever you needed to, so the dollar amounts that we're looking at now could also then be adjusted up or down uh in the future as we get closer to the actual construction dates.

Is that we included an escalation factor of four percent per year for the first 10 years and then three percent a year for the second 10 years?

So if we're within that for inflation, we should be stay on, and that's one reason those numbers are so high.

Is because they're so far in the future.

So we try to account for that so that we don't see too much variation.

Um, but you know that's a ways from now, so we'll we'll see.

All right, any other questions before we go to public comment?

All right, thank you again, Ms.

Miller.

Thank you.

Remote callers, please raise your hand if you wish to provide comment on item numbers 5A or 5B.

Are there any members of the public present who wish to comment?

Seeing none.

Moderator, are there any callers who have their hand raised?

Miss Lanier, there are no callers with their hands raised.

Thank you.

Thank you, Ms.

Lanier.

Uh Mr.

President, that concludes my report.

All right, thank you, Mr.

General Manager.

Can we call the consent calendar item six?

Item six, consent calendar.

Um we've got three items here, everyone.

And I want to know if there's any questions or comments before we go to public comment on any of the three items.

All right, Ms.

Lanier, can we take public comment on the consent calendar?

Remote callers, please raise your hand if you wish to provide comment on the consent calendar.

Are there any members of the public present who wish to comment?

Seeing none, moderator.

Are there any calls who have their hand raised?

Yes.

Thank you.

All right, unless there's any questions or discussion from the commission, can we get a motion and second to approve the consent calendar?

So move.

Move by Commissioner Jamdar.

Second.

Second by Commissioner Thurlow.

President Arceus.

Aye.

Item six passes item seven, approve the items and conditions and authorize the general manager to execute a no-fee, month to month revocable license to the city of Sunny Sunnyvale to use approximately 17 acres of SFPUC land consisting of portions of SFPUC parcel numbers 144, 145A, 146, 148, 152, 154B, 156A, 159, and 165, and the entirety of SFPUC parcel numbers 145, 149, 150, 151, 153, 154A, 155, 161, 162, and 164 in Sunnyvale, California for operating, maintaining, managing and repairing an existing public recreational pedestrian and bicycle path.

Thank you, Ms.

Nier.

Good afternoon.

I'm Rosanna Russell, SFPUC Real Estate Director.

Um we seek the commission's approval of proposed no fee license to the city of Sunnyvale to use approximately seven ac 17 acres of PUC property.

Mostly the right of way for an existing public recreational path, park, landscaping, public streets, and utility crossings.

In addition, the license would require Sunnyvale to maintain an additional parcel, install educational signage about the PUC's water system, and to maintain permitted encroachments for a limited period.

Here are the benefits to the PUC if the commission approves this license.

First, the new license would replace 10 existing outdated licenses that date from 1957 with a comprehensive one new license that protects the PUC's access to and use of its utility infrastructure.

In contrast to the four oldest existing licenses, which were only three pages long.

The new lengthy license contains robust provisions regulating how and when Sunnyvale could install new improvements on PUC land.

This is really important to prevent unauthorized trees and encroachments on PUC land.

The new license would require the PUC's written consent before Sunnyvale could change any existing improvements or vegetation or install new improvements.

It would also require the PUC's environmental management group to determine whether further CEQA review is needed.

The new license contains much more comprehensive indemnity language, protecting the PUC as well as the more modern provisions required by city and state law and the city attorney's office.

In addition, Sunnyvale would maintain the pathway area of 17 acres and an approximately 8,900 square foot additional parcel, saving the PUC approximately 104,000 a year in annual maintenance cost.

Sunnyvale has already removed problematic trees as a condition of obtaining the new license.

Tree removal is quite costly.

Sunnyville would install approved educational signage that provides a high-level overview of the Hatchethi regional water system, educating the pathway users and neighboring schools about our system.

And Sunnyville would continue to reimburse the PUC for its pro rata share of the Santa Clara property taxes the PUC pays.

That the next estimated payment would be approximately $9,000.

Finally, Sunnyvale has demonstrated really good ongoing maintenance over the years of the PUC property.

We anticipate that it would continue to be a good steward in the future.

Thank you.

All right, colleagues, do you have questions about the proposed license to City of Sunnyvale?

Commissioner Turlow.

Thank you for the presentation.

It seems like an obvious um thing to move forward with.

I had a question about this parcel that was previously unlicensed.

Yes.

How was that identified and how do we think about that for the future?

So, you know, we have hundreds of miles of right-of-way.

We have very good watershed keepers and uh right of right of way managers.

We identified this parcel as a condition to entering into a new license, and that's the reason for the new license to really be specific about our requirements so we don't have um unauthorized users so to speak.

And if it was previously in use, the PUC then had liability during that time, is that correct?

Um it was a park, yes.

Um we we probably did with reference to the city attorney's office.

Okay, okay, great.

Thanks.

All right.

Any other questions, colleagues?

Can we take public comment, Ms.

Anair?

Thank you.

Please raise your hand if you wish to provide comment on item seven.

Are there any members of the public present who wish to comment?

Seeing none, moderator, are there any callers who have their hand raised?

Miss Lenera, there are no callers in the queue.

Thank you.

All right.

Thank you, Ms.

Russell.

So with that, unless there's any other discussion, can I get a motion to approve item seven?

Motion to approve.

Moved by Vice President Leveroni.

Second.

The second from Commissioner Jamdar.

President Arcee.

Vice President Leveroni.

Hi.

Commissioner Jamdar.

Hi.

Commissioner Stacy is excused.

Commissioner Thurlow.

Hi.

Item seven passes.

Thank you very much.

Item numbers eight, nine, and ten will be presented together, and the commission will vote on each item separately.

Item eight, public hearing to consider and possible action to adopt, revised miscellaneous fees for the San Francisco Public Utilities Commission, Water Enterprise related to temporary water service through hygience, schedule W 41B, and backflow prevention schedule W 45.

Item nine, public hearing to consider and possible action to adopt.

Three new wastewater enterprise regulatory compliance fees, Schedule W 46 that support the enforcement of the rules and regulations that pertain to the stormwater management ordinance.

Item 10, public hearing to consider and possible action to adapt, new fees for the San Francisco Public Utilities Commission, Power Enterprise, related to street lighting, service connections, rules and regulations, variance requests, municipal poll use, generator interconnections, and gas service requests.

All right.

Hello, commissioners.

Matthew Freiburg, I'm the rates manager with SFPUC.

And I'm here to speak to you today about the proposed updates to water miscellaneous fees and a few new miscellaneous fees for the wastewater and power enterprise.

Alright, this one doesn't want to work.

All right.

Before I jump into the actual proposal, I want to give you a little bit of background about miscellaneous fees in case you're not familiar with them.

These are different from the standard utility rates we charge.

Miscellaneous fees are special charges that we assess to either existing customers or outside parties who request a special service that is outside of our standard utility practice.

We charge these things for a number of reasons.

These are a policy decision to have miscellaneous fees, but one of the main reasons we assess them is to provide broader rate payer equity.

These are again special services, so we try to align the costs of providing that service with those who are receiving the benefit.

And by doing so, we can then remove those costs from what we have to bake into our rate base for when we're set utility rates.

Additionally, we might establish penalties and fines to help enforce bill payment or incentivize compliance with regulations, which you'll see with the wastewater proposed fees.

We update our rates and charges every year.

We have cost escalation factors that we apply, but uh after our rate study, or if we have updated rules and regulations, we'll do a bottom-up evaluation of the fees, and that's what you're seeing today.

Uh, and lastly, we publish all these miscellaneous fees in our rates book so the public is uh well aware of what charges we have approved.

This slide here just kind of walks you through the process that we went through for developing these fees.

Uh, we started in the fall and winter of 25-26, where we're developing the fee calculations, beginning the implementation steps with customer service, uh, and preparing our broader communications plan.

After the budget was approved uh in January, um, we updated our fee calculations, refined our implementation plan, and met with the executive team to solicit approval to bring this to you today.

Uh on July 1st, if these are approved, they'll go into effect, they'll be published in our rates book.

Uh, but for the wastewater and the power miscellaneous fees, we're actually gonna pause on actually assessing the fees.

We want to have a bit of a grace period up front, especially for the wastewater charges.

We want to do more public outreach and do more of a warning system for the fees before we actually start assessing them to customers.

Uh, this slide here provides a methodology that we use, the first step for calculating our miscellaneous fees.

The first thing we do is we look at the cost of providing service, so it's the cost incurred by the enterprise for providing each of these individual services.

Um is comprised of our fully burdened labor cost and any materials uh and equipment costs.

The fully burdened labor cost is a reflection of the estimated level of effort from staff and their fully burdened hourly rate.

That hourly rate is comprised of the their take-home salary rate, with the inclusion of any kind of benefits and overhead allocation, so that we're really capturing not only what it costs to pay somebody, but what does it cost the enterprise to have somebody go out and do this work?

Um it's also worth noting that not all miscellaneous fees are implemented at a hundred percent cost of service.

These are again policy decisions.

There are some services that provide general benefit for other retail ratepayers, so we don't charge the miscellaneous fee at 100%.

There are other penalties that we might assess where we want to apply pressure to somebody who's not acting in accordance with our rules and regulations, so we might charge above cost of service there.

This is an example of one such calculation.

This is the temporary hydrant connection fee, which we'll talk about in a couple of slides.

You can see here that the connection of a hydrant takes the work from three different members of the water enterprise staff.

On the table, you can see the labor class associated with the work, their hourly rate, and the estimated time to perform one hydrant connection.

That gives you our labor subtotal, and then when we apply the fringe benefit and overhead rate, you can see at the far right the total cost from each individual staff member.

So we'll total that up with any material costs.

In this case, there's a $1.90 printing cost associated with this to give us the total cost of providing that one turn of the crank for a hydrant connection of $955.80.

Our proposal is to put it at $955.

This is the only table like this I have in my presentation.

I do have examples of this for every fee that we have in front of you.

There's 21 of them.

So I didn't want to go through this 21 times, but this is the same process for each individual fee.

This is the list of all the fees that are in front of you with the three different agenda items.

We have four proposed revised water rates, three new wastewater fees, and I think it's 12 power fees.

Starting with the water fees, the water miscellaneous fees are updates of existing fees following the revision of some rules and regulations that were passed by the commission in 2025.

The rules and regulations result in an increased level of effort that are required for staff to support the programs that are governed by these rules and regulations.

So here you see the four fees that we are proposing to update.

To orient you to the table, we have the fee titles on the left.

We have our current fee and the fee structure in the second column.

The third column has our proposal, and then the last column has a percent change, just so you can you don't have to do the math in your head if you're interested.

The temporary hydrant connection fee.

This is a fee that is assessed to any entity that wants to connect to a hydrant or a fire hydrant for non-firefighting purposes.

So this is typically builders and contractors, other city departments, groups who are doing street vending events, or filmmakers.

We typically have about 300 of these that are assessed per year.

Again, the fee increase here is predominantly driven by additional staff time and a higher level of effort to comply with the rule, the new rules and regulations.

Next is the temporary hydrant meter rental deposit.

I'm gonna go through these all pretty quickly since there's so many of them.

As the name implies, this is a refundable deposit for anyone who requires a portable meter to connect to a fire hydrant.

So this fee reflects the cost of staff time, the cost of a hydrant meter, but we're adding an escalator there just to provide the incentive for people to return it to us undamaged.

Because if somebody wants to buy one, great, they can go ahead and buy one, but they're not going to buy it from us.

And then in addition to the fee, we also will include the cost of 50 units of water at our commercial volume metric rate.

So you can see the temporary hydrant meter has we have two of them.

We have a one-inch and a three-inch meter that are increasing at different uh rates because there's there's just different underlying cost with each of those.

Last is the hydrant flushing fee.

This is an additional fee for those that want to use their temporary hydrant connection for potable uses.

So what this involves is the staff time to go out and flush the flush the hydrant, remove any kind of material or sediment that may have accumulated.

Uh, and then we also include an additional 13 units of water at the commercial rate again.

The last one on this slide is the backflow tag fee.

Uh, the current backflow tag fee recovers only a fraction of the total cost of administering the current cross control, the current cross connection control program, much less the additional labor costs associated with the new rules and regulations.

However, this is one of those instances where there are broader benefits to the water ratepayers for having this program in place.

So we're not trying to collect 100% of the cost of this backflow tag program cost with these fees.

So part of it is socialized, part of it is incurred by the actual customers who are purchasing these backflow tags.

Next is the wastewater fees, particularly, these are all focused around the stormwater management ordinance.

So we're proposing three new miscellaneous fees, and these fees are designed to support the customer compliance with the stormwater management ordinance.

If you're not familiar with this ordinance, it is applied to large parcels.

So think the Chase Center, 525 Golden Gate.

These are buildings that are typically 5,000 square feet and larger.

And these are required to maintain on site stormwater retention facilities.

This is an essential service that we are this essential program for the PUC because these properties produce a tremendous amount of stormwater runoff during wet weather events.

And having the stormwater management has allowed us to reduce the amount of runoff from these properties and reduce the stress on our combined sewer system.

When done effectively, these will also help uh reduce capital costs on future pipe projects for our collection system.

There are some challenges though, challenges though with the stormwater management ordinance.

We have a lot of compliance mechanisms during the permitting process, but we have almost none once these buildings have occupancy.

About 40% of the SMO customers are failing to comply with the annual self-certification requirements.

And we have 17 customers who are actually received notices of violation.

But we have no means of actually enforcing beyond paperwork.

So that's the purpose of these fees here is to serve as a bit of a financial incentive for compliance.

The goal here is not for us to generate revenue, but to serve as a bit of a warning saying, hey, you know, if you're not complying with the ordinance, there will be financial penalties.

And they they ratchet up, as you'll see as we walk through these.

So the first one is a $500 fee for the annual self-certification non-reporting penalty.

So these customers have to fill out a form every year, demonstrating and stating that they are uh they are managing their on-site stormwater assets in compliance with an MOU that they signed when they took occupancy of the building.

If they don't do that, then we'll set then we'll assess them a $500 fee.

Again, these are huge buildings.

This is more of a mosquito in the ear, but still intended to be uh enough of a nuisance that they'll that they'll start complying with that requirement.

Additionally, we have the the stormwater management ordinance reinspection fees.

So every three years uh we have a requirement that staff will go out to these properties and conduct an inspection of their assets to ensure that what they've been reporting annually is actually what's happening on the ground.

The first inspection is free, that's part of the program.

But if we identify issues on site that have to be corrected that require us to come back again and do another reinspection, we will charge a reinspection fee at 50% of the cost of providing service.

If we have to come back a second time, we ratchet that up to the full cost of providing service, and if we have to come back a third time or more, then we'll add an additional 50% penalty.

So we'll charge that at 150% of staff's cost staff's time.

But again, it's only $2,000 for each subsequent inspection.

The last one is really where like we have a more material penalty.

This is the administrative civil penalty order fine.

This is for customers that have failed to either show up or respond to any of their requests for inspections, or have are indicating that they have no interest in actually making any of the mitigating uh requirements that staff have indicated or required for complying with the ordinance.

If we get that far, then we'll start assessing a daily fine of $1,111 per acre of drainage area that is out of compliance.

So it's not necessarily the whole entire property.

If they have one-third of the property is out of compliance, two-thirds is in compliance, it's only that one-third uh portion of the property that would be getting assessed this daily fee.

We do have rules about a maximum daily fee amount.

So the maximum daily fee amount could be $1,000 or $2,000, depending on if their lack of compliance is due to intentional uh intentionality or negligence for the violations.

All right, so that's stormwater.

Last one to go.

Just power now.

Uh so for the power enterprise, there are a number of services that have been being provided free of charge for a number of years.

This is predominantly because we haven't had a mechanism to implement these fees.

And now that we do, we're looking to move forward with 12 new miscellaneous fees that pertain to these six categories here.

Uh so this is all of them, so uh bear with me as I go down the list here.

Um the first five uh have to do with streetlight installation fees.

Um the first one is a streetlight application fee for $611.

It's a simple fee for just covering staff time to review the streetlight applications for anyone who is requesting new street lights to be installed, either through a redevelopment project, a new development project, or even an individual who wants new streetlights on their street.

The next is a streetlight site investigation fee.

This is an optional fee.

So if somebody wants SFPUC staff to come out and inspect their site before they uh submit an application or during the application process, if they feel like it would be better for them to have staff come out and look, we'll charge this $1,790 fee.

Uh next is the Streetlight Photometric Review fee.

This is assessed for reviews of streetlight plans to ensure that lighting designs meet SFPUC's streetlight standards and requirements.

You can see that this one has a bit of a range.

This one is assessed based on the size of the project measured by street frontage area that's being illuminated.

So this fee in particular is for the initial review of the photometrics plan.

You'll see that we also have a subsequent review.

Most will make it through with a single review, but if we for whatever reason need to do a secondary photometric review, we'll have an additional fee, but you can see it is a lower amount because there's less paperwork that needs to be done for this one.

Um lastly is the installed streetlight inspection fee.

Again, it's a range because uh smaller, small, medium, and large projects get charged a different amount.

Um, but this is for final inspection of installed street lights at the end of at the end of the design review prior to acceptance of assets by the SFPUC.

So that's it for the street light inspection.

Everything else here are individual one-offs.

So those first five they generally go in order.

Everything else is standalone.

Um, so next we have the streetlight shield fee.

We get a number of requests for uh from customers to install a shield over the streetlight.

So imagine those big Cobra lights that are on a street, um, they can shine light into a home or a business.

If people request for a shield to be installed, we're uh we're proposing a charge of $3,317 if that's being installed on a PUC poll, and then we have a higher fee if that's a PGE poll because PGE will charge us for accessing their polls as well.

Uh next we have the municipal poll use fee for non-banner use.

Um, any banner use is the domain of public works.

Um, but for uh non-city entities that request to access our streetlight polls.

Um, this could be community groups, business districts, neighborhood organizations that might request to put in like string lights for the holidays, baskets or other decor on our street lights, that's what this fee is there for.

So it includes a one-time application fee, which includes the approved use of one poll, and then we have an additional $180 fee for each subsequent poll that they're requesting access to.

And then we have the new upgrade or removal of metered service fee.

This is for uh customers requesting a new metered connection, a service upgrade, so they want higher load, or if they want a service removal.

Uh so that is a $3,000 fee.

Then we have the metered service modification fee, similar, $2,000.

Um, so this is for someone who requests modification of an existing metered electrical service that doesn't involve an increase or decrease in load.

So this is really like meter relocations, temporary shutoffs, or conversion from an overhead connection to an underground connection.

Um we have the rules and regulations variance fee.

Um this is an application fee applicable to customers who propose to deviate from SFPUC's rules and regulations related to electrical service.

So we have certain standards about how uh assets need to be installed.

There may be some site constraints where they can't do it to the letter of how our rules and regulations are established.

So if they can find an engineered alternative solution, that's where this would apply.

And we're proposing a $5,000 fee.

Again, that's mostly staff time associated with that one.

Then we have the generator interconnection fee.

Um, this is an application fee charged to customers who request to connect uh to a customer owned generating facility to the electrical grid.

So this predominantly gonna be rooftop solar customers.

Um it could be some customers who have really large battery storage devices or other other generation facilities as well, but these are the main ones.

I can't imagine there's gonna be a lot of like gas or diesel generators.

Um this is a really small fee.

This is well below the cost of providing service, but we're trying to incentivize solar the best we can.

So we're only recouping a portion of our cost.

The last one is the gas service request fee.

Um so this is applicable to uh Hetchy Power municipal customers who request a temporary shutdown or permit removal of existing gas service connections.

And while PGE is the primary gas provider, we serve as a bit of an intermediary between the customers and PGE in this one.

So that's a 930-933 fee.

Okay.

So with each of these, there's a lot of fees that we're proposing here.

Um, this is a quick summary of the communications and outreach strategies that we're proposing we're proposing.

For each of the enterprises, we are proposing an update with all this information on our web page.

Uh for the water fees, uh, all hydrant meter permit uh holders are gonna have mailers sent to them because that is the biggest change on the water side.

So anybody who is a frequent flyer of requesting these hydrant connections, they're gonna get a letter indicating these increased changes.

So next time they apply for a permit, they'll be informed and not be surprised by this uh large increase in that charge.

Uh for the wastewater fees, we are sending letters and emails to all uh properties that fall under the stormwater management ordinance along with the building owners, uh, building owners management and managers association, um, the San Francisco Apartment Association and design development uh contracts.

For power, because there are so many, we have a much broader uh outreach campaign.

So we are sending targeted emails to city departments and the developer community, uh department CFOs, uh brief we're gonna be holding briefings with city departments, 311, the San Francisco Permit Center, and then we're gonna online we're gonna be putting up a tutorial on how to pay for these fees, and that's gonna be on our website as well.

So, in closing, staff's recommendation is to adopt the uh resolution on the revised miscellaneous uh water fees and the proposals to adopt uh new miscellaneous fees for both the water for wastewater and power enterprise.

Thank you for your patience through all that, and um ready to take any questions.

Alright, thank you, Mr.

Freiberg.

Yeah, we have a question from Commissioner Jamdar.

Thank you so much for that detailed presentation.

I really appreciated walking through every line item with you.

Uh I have a question about the power enterprise fees.

And I see that there's uh the other two enterprises seemed like more commercial customers that would be impacted or new developments.

So I feel like it's less impacting the individual customer.

Whereas these power ones seem to be more at the household level, particularly the uh upgrade fees, the meter upgrade fees or power upgrade fees for three thousand dollars in the context of just electrifying homes in the next few years.

That seems like a real, you know, obstacle to sort of penciling out projects that are already expensive.

So could you explain the rationale for that particular cost and where that came from?

Yeah, and that great question.

Uh recall that HECI power uh is predominantly municipal customers, and then we have large multifamily uh housing projects.

There are very few single family.

I don't think there's any single-family residential uh customers on hetchie power.

Okay.

So if that was clean power SF, then yeah, those would be really big fees for a household.

But these are generally uh larger larger properties.

I think that that answers my question.

Thank you.

Vice President Labroni?

Um, kind of a facetious question on the, you don't have to answer it.

It's since we're charging printing costs of a dollar ninety, why not just bring it to 955 instead of nine fifty-five, nine fifty-six?

No answer need that.

Because when I saw the dollar ninety, I go, okay, they're covering everything.

We gotta be complete.

I know.

That's they very good.

Very good.

Um of the large projects that are going on now, just wanted to know, you know, or being on the on the board in the planning uh area of San Francisco, like in North Beach and the marina districts.

How will the uh this help with the um the uh I guess the combined system when you have a project of, say, over 250 uh apartment or condominium units that'll be new uh to an area?

How will the uh wastewater and the water system, you know, with this plan help um, you know, alleviate and take some of the issue of the wastewater and storm water going in trying to see the functionality.

So the idea behind the stormwater management ordinance is that it is really difficult to find large real estate to put in regional stormwater BMPs.

So you're thinking of large-scale bioswales, bioretention facilities.

Um generally we're limited to these like small rain gardens around the the envelope of buildings, but finding large parcels in the city where we can install these kind of projects is really difficult.

So instead, we're looking to the large property owners uh that generate tremendous amount of runoff to be able to manage the stormwater on site there on the on their individual properties.

The challenge that we're running into is that without the compliance, um they're letting their BMPs kind of fall into uh into a state where they're no longer performing as needed.

Uh so they're continuing to gener off generate high levels of runoff.

By bringing them into compliance, it will reduce the amount of runoff in large storm events, and that means that our collection system doesn't need to be as large as it would be otherwise.

So it does save money to for the the general ratepayers that we don't have to like upsize our our collection system as these new large buildings are constructed.

And the the large buildings are they is would 250 units or 80 units?

Where does the word large fit in?

It's not so much vertical, it's more about the footprint of the building.

So uh for area for buildings in the combined sewer system area, it's 5,000 square feet, and I believe for the separate the few separate sewer uh areas it's 250,000 square feet.

Okay, and and cost impact, I mean what the to let's say you do have a 5,000 square foot or 10,000 square foot area for a developer to say, okay, we you know, one of the requirements is to put this in.

You might not have, but just wondering, is there a ballpark that it's a that's a million dollar project or yeah, that's a good question.

I'd have to talk to our watersheds team about like the general costs of those of those installing those BMPs on their property.

Um it does serve as a bit of incentive to leave green space on the property and not build everything out and pave it uh end to end on the parcel.

Um yeah, I can give with the watershed team and send ask them if they have that estimate and send it to Missile Linear.

And then on the special services, like for the water, are we talking like the filming companies that would come out and say need to wash down a street for effect?

Yeah, and projects like those would you all consider special projects?

So the special service itself is like in that instance is actually just staff going out and connecting uh the temporary uh the temporary meter to the hydrant.

Um and the filmmakers are just one common, like a frequent flyer that uses that.

Um but building builders and contractors are typically the main ones that are, I think they're the most common users of that hydrant connection.

Is there a charge for the amount of usage of is it metered that if they use 10,000 gallons?

Is there's a charge for that?

Yeah, and that's the purpose of the meter.

So we charge them for the administrative cost of like doing the paperwork and going out and having somebody do the installation, and then we have that temporary meter there and we'll we'll charge them at the commercial rate.

Okay.

Okay.

Um, all right.

Thank you.

Thank you very much.

Yeah, absolutely.

Great, thank you for the presentation.

I have a follow-up question on the stormwater management ordinance.

It's it sounded like there were a 40% noncompliance.

How in terms of the reporting back on an annual basis?

How many of those noncompliant reporters do we think are actually people who are going to have problems in the um in the inspections and actually complying with the on the systems level?

That's also a really good question that I'd have to ask our watersheds team about.

So I can follow up on that, but I think there are I think that there is a good connection between those non-reporters and those who are also not showing up to their inspections, or or they're doing last minute cancellations, but it's kind of showing disregard to staff.

Yeah.

Yeah, that makes perfect sense.

So it does seem like if you can move that compliance number up, actually you'll see an effect on the amount of retained stormwater during large events.

That yeah, that is the hope.

Okay.

And we're only expecting there to be more properties that fall under this category.

There's only around 400 right now that fall under the purview of the stormwater management ordinance.

So we're trying to catch it and get these systems in place before it's a larger number of uh properties.

Right.

Oh, that makes perfect sense.

Um my second question is on the grid on the generator interconnection fee structure.

This is a scenario which you described quite sensibly as um a situation where there's a sort of social benefit to having more people with backup uh generating devices associated with a grid in general.

Um that makes sense to me.

How do you go from thinking about this?

And this is kind of a general question, thinking about there being a social benefit to deciding on the discount level for the fee, because in this case it's like single percentages, and I'm completely in favor of that.

Um but I'm just wondering, how do you go from full freight to zero percent?

And in this case, that seems like I was just wondering this seems like it's consistent with PGE's fees structure on the residential side, but not the commercial side.

So I'm just wondering how you think through this.

Yeah, so there are a number of considerations that we'll take into account.

Uh some of it is trying to conceptualize what is the broader uh rate base benefit, and that's the case of like the backflow tags.

Uh in this one, yeah, a lot of times we'll look at what are our peer agencies doing or what is PG<unk>E uh doing in this case to see just to make sure that we're not wildly out of step with what we're doing.

Like we don't want to seem like we were being overly punitive to customers when they have to join our system where they would have been better off if they could have been a PGE customer.

Um, so a lot of it is in internal discussions, uh trying to figure out what is the right way to evaluate it.

Some of these things are quite difficult to quantify.

Um, so there is a monicum of judgment uh and doing evaluations of what we think other agencies are doing as well.

And so just one follow-up.

How do you think about residential versus commercial users in a situation like this?

Um in this one, we didn't want to differentiate.

I believe that there was a structural uh challenge with creating two different pay scales on this rate.

Uh, it has to do with the platform that we're using to implement some of these charges.

So we had to, I think this one we had to pick one or the other.

Okay, that makes sense.

Thank you.

Vice President Leveroni.

Just a follow-up question to Commissioner Thurlow on the penalty for those that I'm getting the feeling that might be avoiding inspections and pushing back and you know, not um say being compliant.

Is the penalty stiff enough?

Or is that something that after uh we have more information on who is, you know, say not um being fair in the game, um, because we saw the cost that we have to try to work through this whole combined system and not do discharges.

I mean, it's not uh a small number, and for those that might be contributing far more and not being compliant, you know, a thousand, five thousand dollars is I'll I'll take that, versus you know, if it starts to get more significant.

Is that something that has been discussed or thoughts on that?

Yeah, we thought about that quite a bit as we were developing these.

Uh we didn't want to be overly punitive, and we didn't also want to make it look like the PUC was trying to have a money grab uh for any of these customers.

Ideally, we wouldn't need these fees at all, but the lack of compliance um is putting us in a position where we feel like we need to.

So, this is our first our first step.

And again, like with those fees in particular, even when if they go into effect on July 1st, we want to do something.

The metaphor we were using was with the city's traffic light cameras, how uh warning citations were sent for six months in advance.

We want to do something similar here.

We don't want to catch anybody off guard.

Again, we're not trying to make money from this.

We just want everyone to follow the ordinance and comply with the MOU that they signed when they took occupancy of the building.

Um so if we find that it's not significant enough and it's not moving the needle on compliance, we'll keep using the soft touch of outreach and communication.

But if we feel like we need to increase the fees, then we'll then we'll come back and we'll we'll try maybe a heavier hand.

Uh, but I don't want to start too aggressive.

Excellent.

Thank you.

Thank you for your answer.

All right, unless there's any other questions, we've got three items in front of us that after we take public comment, we'll uh consider.

And so it looks like we're going to um proceed if we can, Ms.

Lanier with asking for public comment on either of items eight, nine, or ten.

Remote callers, please raise your hand if you wish to provide comment on item numbers eight, nine, or ten.

Are there any members of the public present who wish to comment on these items?

Mr.

DeCasta.

I was listening to the gentleman, you know.

And while I'm listening to the gentleman, the street employees that were fired, they were fully qualified to do jobs like has been stated.

Has this gentleman done um an audit and gone to the water department to see what are the what's the standard of those people who can who can do what this gentleman has put in writing?

You see, this is what happens with SFUC.

You have consultants, or this wannabes who come out with all this type of ideas when if there is a real situation, like I had at my office on Third Street, it took these guys 21 days to fix it.

Now, the other thing is, is there a workshop?

Done for the community in the in the in the 11 districts.

Do these guys know that we have 11 districts?

What is guides and where do they come from?

Look like they come from another planet.

Let's be very practical.

This BS must stop.

Already we are suffering.

The people from the laundry mats, the residents, San Franciscans conserve water, the businesses, BGE.

In order to rewire my office, cost me 40,000.

I had to bring experts to do it.

Because the idiots couldn't do it.

Thank you very much.

Thank you.

Moderator, are there any calls who have their hand raised?

Ms.

Linair, there are no callers in the queue.

Thank you.

All right.

So we have the three items in front of us with respect to adoption of fees.

Item eight with respect to water enterprise, item nine with respect to wastewater, and item ten with respect to power enterprise.

And I understand, Ms.

Lanier, that we should go ahead and take each item individually, starting with item eight.

Can we get a motion to approve item eight?

Motion to approve item eight.

Motion by Commissioner Jamdar.

Second.

Second by Commissioner Thurlow.

President Arceus.

Vice President Leverone?

Aye.

Commissioner Jamsar?

Aye.

Commissioner Stacey is excused.

Commissioner Thurlow.

Aye.

Item eight passes.

Thank you.

Can we get a motion to approve item nine?

So moved.

Motion by Commissioner Jamdar.

Second.

Second from Vice President Laborone.

President Arceus.

Vice President Leverone?

Aye.

Commissioner Jamdar.

Aye.

Commissioner Stacy is excused.

Commissioner Thurlow.

Aye.

Item nine passes.

And finally, can we get a motion to approve item 10?

So moved.

Motion from Commissioner Jamdar.

Second.

Second from Commissioner Thurlow.

President Arce?

Aye.

Vice President Leveroni.

Aye.

Commissioner Jamdar.

Aye.

Commissioner Stacy is excused.

Commissioner Thurlow.

Aye.

Item 10 passes.

All right.

Thank you.

Thank you, Mr.

Fiber.

Thank you to you and your team for all your work.

Clearly, put a lot of time and energy into this, and we thank you.

Item 11.

Approve an increase of $500,000 to the existing cost contingency in 274 calendar days to the existing duration contingency for contract number HH 1013.

With Sierra Mountain Construction Incorporated.

Good afternoon, General Manager Herrera, President RSA and Commissioners.

I'm Kim McFarland, the project manager for HH 1013.

Could I have the slides, please?

We'll see how this supposed to not sure how to advance with the mouse, sorry.

Give me a second.

There's a left clicker.

Left clicker.

Okay.

Um all right.

So our project site is located in Moccasin between highways 120 and 49 in Tuelme County in the Sierra Foothills.

The Moccasin compound water system is located above Moccasin, adjacent to the pen stocks, which you can see to the right of this photo.

The system is supplied by Hetchhee Reservoir via the pen stocks and produces drinking water for the employees and residents of Moccasin.

The system uses UV disinfection to treat the water prior to distribution.

During Hatchechi system outages and under some water quality conditions, the water supply requires filtering as well as UV treatment, thus the need for a permanent microfiltration unit.

As we presented to the commission last year, prior to design and construction, a geotechnical investigation was conducted, and the depth of component bedrock was determined.

A retaining wall supported foundation was included in the original design.

But the team discovered during construction that competent bedrock was deeper than anticipated.

The difference meant modifying the design to something constructible while keeping the same project site.

This is a photo showing the contractor excavating to competent bedrock on the lower foundation of the building.

Switching to drilled piers provided a constructible design given the changes in bedrock elevation.

So last year you approved an increase of 1.5 million to the existing cost contingency, an additional duration of 266 days due to this foundation design change.

Unfortunately, there have been additional design modifications, some as a result of the foundation change, and others at Hatchie's request.

Because of these additional design changes, we are recommending an increase of 500,000 to the cost contingency and 274 days to the existing duration contingency for a revised duration limit of 920 days, ending the contract March 30th, 2027.

We have made a lot of progress over the last year.

We have a building now, but electrical and plumbing work are ongoing and commissioning is still pending.

As we noted last year for lessons learned, for future work in the area, we will conduct more thorough geotechnical investigations ahead of the design.

We think for the presentation, we have a question from Vice President Laboroni.

I think you actually answered it to where it sounded like our initial um drilling and and uh looking at the bedrock and going down was not sufficient enough to pull these out.

So we hadn't done a thorough enough geotechnical investigation.

It turns out that the geology is quite uh varied in the area.

Okay, all right.

And and so lesson learned going forward on doing these things.

More densified borings, yeah.

Thank you.

All right.

Thank you, Vice President Leverone.

Is there any other questions?

From Ms.

McFarland.

No?

Okay.

Um thank you for the presentation.

We'll go ahead and take public comment and consider the item.

Remote callers, please raise your hand if you wish to provide comment on item 11.

Are there any members of the public present who wish to comment on these this item?

Seeing none, moderator, are there any calls that have their hand raised?

Ms.

Linair, there are no callers in the queue.

Thank you.

All right.

Colleagues, the items in front of us, can we get a motion to approve the increase?

To the existing cost contingency.

Motion from Vice President Leveroni.

Seconded.

Second from Commissioner Jamdar.

President Arce?

Aye.

Vice President Leverone.

Aye.

Commissioner Jamdar.

Aye.

Commissioner Stacy is excused, Commissioner Thurlow.

Aye.

Item eleven passes item 12.

Thank you.

Communications.

The Commission takes note of the communications that were received.

Item 13, items initiated by commissioners.

Commissioners, are there any items to initiate for future discussion?

No, there are not.

Item 14, adjournment.

This meeting is adjourned at 2 41 p.m.

Thank you, everyone.