this afternoon. it appears we have pretty much cleaned it up, but there were sizable large maines, some businesses. i do not believe any homes were flooded. it looks like traffic was affected in sunnyvale area, but it is mostly back. pg&e and our crews have been doing a lot of work to try to help pg&e test the pipelines. as you might imagine, the california puc has been pressuring them to make those repairs as quickly as possible. to get a new easement where they would have to replace some of the pipe would take months.

we are attempting to give them revocable permits that would allow them to start the work as quickly as possible. it does mean that we will be bringing back to you and to the board of supervisors permanent easements, but to be clear, we are giving memory vocable -- refocus it -- revocable permits that would be easier to say no to later. one of them would be the crystal springs golf course. they're trying to replace, in one case, 39 mi. of pipe. this is a big job and they're trying to do it as fast as possible. our intent in mind to be your

and our objection would be to give them reach vocable permits the -- revocable permits. >> will there be easements granted? >> there will be easements, but in this case, they just tend to be over a little bit from where the pipes were. >> there just over a little bit from -- ? >> that is the norm. >> and it is natural gas? rex it is. -- >> is. >> my only concern is that in the course of doing this, that somebody does not create problems that did not already exist in terms of if it is in the watershed, either drainage or more exposure to reservoirs.

>> we have been having that discussion of what because we have been careful not to remove the watersheds. i gather typically they do not go through the normal ceqa process because the california puc handles all of those problems. a lot of what they're doing now with ceqa is new to them. mitigation as -- is not the norm of what they're used to dealing with. >> and as we look at ways to accommodate and safety concerns, that action gives us ways to go about doing that.

commissioners, any other thoughts or comments? >> the next item up is the quarterly budget report, which is a little anticlimactic because it is the quarter ending last june. >> a very brief report today. there aren't -- four sides in your packet. this is a budgetary scorecard, much like we discussed earlier with the audit score card, and where we're seeing green lights and yellow lights and red lights. the key items are on page two on the overhead. water use and sales were up just slightly. we had precipitation just 65% of normal. that led to fourth quarter sales that was much drier than expected. that translated into good news financially, a bit better news than what we have assumed in the previous quarterly report. that translated as well into slightly better revenues in the

chief reserves and build up as well. >that dry weather meant that our revenues were somewhat lower than expected. the checking into account balance by the end of the year is about what we expected, about $300 million in the water enterprise. and about what we expected for the third quarter for hetch hetchy because other cost savings balance out some of the other revenues. the scorecard that you look at every quarter are the key ratios in accordance with how we're doing according to the observance policy. and that is met across all three enterprises, with not only water

receiving the check mark for revenues. but again, everyone is coming in healthy, as u.s. to norplant -- as you assumed in your plan. >> commissioners, any questions? >> i had one. i notice under the hetchy materials that there was half a million less power materials purchased from that project. should we read anything into that? or is that a normal fluctuation? >> we budget up to the projected availability of the power. we budget about $2 million. we did not meet that whole amount based upon generation. >> and is there anything -- is that just a matter of the weather? or is there something about the efficiency of the units or

anything of broader interest? gregg's assistant general manager for power. it is largely weather-driven. >> does that mean that we will be changing our estimates in the future? or is that just this year? >> i'm sorry, changing our -- ? >> estimates. >> yes. we always cast back to forecast our future needs. whether that is something we will have to adjust for, but yes, we will take a look and verify our understanding of the differences. it is largely weather-based. if there is a performance problem, then we are not out money. the contract terms protect us from that. >> i thought it was not an issue

that even in heavy fog would generate enough. >> we do generate electricity. just as on an overcast day you can get sunburned and generate electricity, but it is not as efficient. we only pay the power producer for the kilowatt hour per meter. we pay based on what we are projecting. it produced less, so that means we are paying less, but that means we are whole and not harmed. >> and the other item is our standard water system and

program report. >> good afternoon, commissioners. in my have day-to-day i wanted to touch on two projects. the caltrans dam and the bae tunnel. the cow thecal res -- the cal res dam, we have completed 14 of the 16 additional borrowings that are required to further analyze these new geologic features that were discovered at the project site. the contractor has been very helpful in giving us sick access to those locations where the design engineers wanted us to drill new borings. but the analysis of the data that we are generating, as well as the design modifications that are needed to mitigate the potential slope and stability

should be available by mid september. and then it will likely take a full two months to negotiate a change of this magnitude. only in late november or december will we know for sure the exact cost and schedule impact of that change. in the meantime, we are continuing on that contract work and making progress on a number of activities that are not on the critical path. obviously, we are very anxious to start excavation began on that slope of the abutment. and i'm working very closely with the design team as well as the contractor to make that happen in the next few weeks. as you know, that work on the bae tunnel has progressed very well. however, we did encounter a situation late last week that will impact our project progress.

last friday, we were notified by cargill, who is in charge of a salt pond operation in new work, that they had discovered some pretty significant cracking around one of their levees around their salt bond -- salt pond in the bay. and since we had just tunnel underneath that levee, the assumption iwas that the tunnelling was what was causing the cracking. keep in mind and our tunnelling is 680 ft. below surface. we immediately stopped our exploration activities and we're working with our project engineers and geologists on assessing the situation. we have also completed the repairs on the crack subsidence on the levee already. we have yet to determine whether or tunneling activities are what cause the cracking.

in the meantime, we're putting together a mitigation plan that involves the driving of she piles on both sides of two different levees, which would allow us to continue operations. we have also asked our contractor to revise their soil conditioning plant. this is the conditioning they use ahead of the tbm to avoid potential subsidence in the future. in the meantime, we are continuing with the excavation of the shaft at newark, and that is going very well. our goal is to resume tunneling as soon as possible. however, i anticipate we will be on hold for three to four weeks. the good news is that we are about five months ahead of schedule on this project. we are in a position where we can absorb that in our project

schedule. i will be happy to answer any questions you may have. >> commissioners, any questions? >> thank you very much. >> that is the report. >> ok, thank you. any public comment? >> david pelle pal, and i'm just touching back on the pg&e gas pipeline on the revocable permit issue. this is the first and hearing about it. i appreciate the watershed mitigation protection. it seems that there would be all kinds of impacts and things. i do not know who has to reply with what ceqa requirements. that is an interesting point. i would hope that within the staff that the groups are

involved and what ever we need to do and what ever reports need to be generated or monitored that it can be done to the commission in the future. i'm also wondering if pg&e will vacate their existing building if their new pipelines are being taken out of the old? and i'm assuming that they will cover all of the puc costs related to this relocation. >> mr. harrington? >> all of the different parts of the puc are involved with city planning, because city planning has to be happy with the final review on that. in many cases, i believe they want to have the old pipeline left in place. what you do when a pipeline is still underground there, we're working on reimbursement of

costs. >> and if they are leaving the zero pipeline -- leaving the old pipeline, to the extent that their costs later on, they're working that out, right? >> yes. >> ok, thank you. >> the report of the bosky general manager, mr. johnson. >> i will keep my remarks brief. you have a long way to go today. i think i am interested in watching you deal with the triple bottom line, as you do your sources to work. a couple of comments, ab 6127, that would allow us to issue substantial bonds that is on the governor's desk, hopefully he will sign it soon, or at least not veto it and allow it to become law. we will continue to work with staff to make sure all the pieces are in place that we can issue the bonds and you folks can use the money.

we will be going to our board in september with some major actions. the final action will be in november. but we will have major actions to get people on board to get their rights in putting our package together. i have already extend my personal congratulations to mr. kelly. with that forward to working with him and continue working with the commissioner -- commissioner and the mayor to satisfy all our customers and state -- stakeholders. i will save all of my guest remarks to a later date. [laughter] >> thank you. which brings us to the consent calendar. madam clerk? >> >> item 9, consent calendar, approve meant -- approval of the award agreement see as a-1678-

seat, a conference of technical services for renewal and advanced energy generation systems for a cumulative total of $6,750,000 and with a duration of five years per agreement. the, approve the selection and award agreement cs-229a-d as needed. for the water enterprise tormc of water and environment, aecom water resources engineering joint venture. a total of $16 million and with the duration of five years per agreement. see, -- c, a community choice

aggregation to authorize the general manager to execute this amendment with an extension of treatments for total duration of four years and three months. d, approved amendment no. 3 to provide continued engineering support for the bay division part by no. 5 cordilleras micro tunnel project and authorize the general manager to execute this amendment. increasing the agreement direction by one year for a total duration of seven years. e, approve the plans and specifications and award a

contract w.w.-542, oceanside water pollution control plant dewatering facility upgrades in the amount of $4,547,000 with the contract duration of 510 consecutive calendar days. itf, authorize the general manager to execute a jaunt -- a joint funding agreement with the u.s. geological survey for an amount not to exceed $1,750,000 for the duration of five years. g, discussion and possible action authorizing reimbursement of certain expenditures for capital related costs of the water enterprise from proceeds of a future bonded indebtedness. >> thank you. i have a request to remove to9e.

hearing no objections, i move items nine with the exception of 9e. all in favor? all opposed? motion carries. >> a wanted to speak in terms of solid water content. that indicates there will not be a range of savings on our costs. i wonder if in the future we can report that, or if there is an -- a way to estimate that. i'm very excited about not shopping around a 17% of the dewater cake. hopefully we will do the same as in as possible at oceanside in the next year-and-a-half. this is fantastic stuff. and also, taking with the

temperature faced in a big direction, a project was approved a month ago at oceanside that will improve the solid handling process. i'm very excited about bio solids. thank you. >> i art -- aren't we all? [laughter] i appreciate your comments. one thing i had commented to him earlier today was that this is a good news contract award. it is money being spent on the southeast. it has large purchase a patient. it is a good project and it is worthy of note. >> and i should note that it is significantly less than the engineers estimates. we are taking advantage of the good contractor. >> thank you, mr. kelly. >> the other thing that i would like to point out that is significant is that it will be contained.

the other thing i wanted to point out is that the contractor that won this award, cal state, was one of the contractors that loss with a slim margin to moderate mechanical. and they came back and it again and won this project. we have faith they will be in the program. >> ok, thank you. >> could i have a motion? >> moved. the crack second. >> all in favor? motion carries. item 10 will probably take about an hour and a half. why don't we take about a five minute break.