>> can we have everybody sit down, please? >> thank you. madam secretary, would you call item 10? >> item 10, is to resist an improvement program validation workshop #3. endorsement of goals and levels of service, and validation of

the sewers system improvement program projects, scope, and a plantation process. >> thank you. >> good afternoon. we are finally here at workshop 3, the end of our validation series. i want to commend the commission because you helped to guide and for this process in the last several years. and it has been years. we had three workshops in 2010- 11 and we had three workshops this summer, but all has led to the validation of that improvement program. we have had numerous briefings and input from the public. i have to say on behalf of

staff, this is for moderate level staff all the way to the very top and general manager harrington, there have been very long days and late nights that have gone into putting this together and to delivering this information in a quick, robust way. we feel that the information we have put forward to you has been well thought out. it has been responsive to your questions and i think he will be happy with the workshop today. maybe we can start with a reminder. we did have the two validation workshop in july. the first was july 10th and focused on treatment options. then we followed up on july, -- and then we followed up on july 24th. today we are going over the

questions that we received an compiling that into our as sip. at the end of the workshop, said the that is different is that we will be asking the commission to consider a resolution -- a resolution to endorse the goals and validate the ip and move forward with the first phase of work. we started out with our five questions. this has been common throughout each of our workshops. do we include the treatment recommendations, the collection system recommendations, the cost and schedule, the duration, the associated rate impacts, and because of level of service. we have to wrap up the goals and levels of service and have that completed. we want to hear from you if you have supported the recommendations that support our validation process.

and if you agree with our proposed phasing for the program, we are looking for a way to take this $6.9 billion program and phase it over time so we can deliver the most important things first. first, todd will review the rates, and then joanne ellis will join us to talk about the public education. this is the agenda for today's workshop. i know some of you are probably thinking about the question that you asked in workshop one or two and wondering when i will get to it. we will start out with a brief reminder of the questions and i will tell you the reader's digest version. then the presentation itself will match them in the order that we go through them. the program manager will follow my presentation and he will be going through the project options and so that we have that for the record. and we can refresh and look at the great green question.

and as we did in a frock -- the prior workshops, we will have a positive * track discussions -- specific times to have discussions. it has worked pretty effectively in the past. with that, we will begin the meat of the workshop. these are the questions. the first one is whether the ssip should change the goal to integrate green and gray infrastructure and to minimize flooding. we agree that a joy. we will get more on this item. -- we agree that it should. we will get more on this item. the second question is whether the bias salads digester facilities project can be accelerated. but yes, we will present to you today a way to consolidate that

schedule. we also have some work in our program some work that could be done on the existing digesters. question 3, do we need to buy a $7 billion program today? we are requesting your validation of our $6.9 billion program, but we will present -- present a phased approach that we think is workable. that will be during the implementation portion of the agenda. the question came up from commissioner moran, are we double counting the green infrastructure budget. no, we are not. and we will recap the entire section of the workshop where we're talking about gray and gray/green projects and how those compared in costa and can -- and performance. and we will compare rate made --

ratepayer monthly bill impacts. todd will include that and we have actually included what the impact would be in the year 2032. just to revisit, hopefully for the last time for a while, are the ssip recommended goals. in black font are the goals that we have consensus on. we were asked at the last meeting to modify the second goal so that we could articulate our commitment to fighting as well as integration of green and gray. we have done that and we believe that the goal written grey integrates green and gray of the structure to manage storm water and minimize flooding. we believe it achieved that.

you probably wonder why in your packet we included both the non -- both the red line and the non-red line. we have gotten the worksheet that is now complete. in your commission package, we included all the changes that were read mind that made it through the process of workshop wind and workshop two. the recommend -- workshop i and workshop ii. the recommendations are what are delivered. the strategies are what we are deploying. the goals of servers are what we are trying to me. you have that agger permanent record. and that will be as we move forward and try to get the agenda items on resolution for -- four, the very items that will be included in that. with that, i would like to ask dan donohue from the program

management team to come up. he will be reviewing the recommendations that we established. he will talk about the treatment projects and the collection systems projects. >> good afternoon, commissioners. the summary that we will walk through this afternoon focuses on the recommendations that we presented to you at the two previous workshops, one on the treatment plant, and one on the collection systems. as you recall, in workshop one, we first discuss the dios del digester -- biocell digester facilities and the treatment plant at oceanside and north point. in a workshop ii, we discussed improvement of the system systemwide. and we looked at bayside issues,

with side issues, and green infrastructure. we will review the recommend -- -- recommended options from each of the categories. as karen mentioned, you asked also that the cost of the options be related to the average monthly bills. i will try to provide this information as i walk through. for the biosolids, we recommended option 3, which include new facilities. the facilities would be relocated away from the impacted neighbors along phelps street. the cost of the program is just over $2 billion. also as karen mentioned, you asked us to look at whether the schedule for implementation of the digesters could be accelerated. on this slide at the top, what we reflect is what is presented

to you for implementation in workshop i. at the bottom is what we are considering -- presenting for your consideration today. in looking at how to shorten schedule, we looked at activities related to planning and design. we looked at front end as well as back and activities in sequence a for the plant. we looked at shortening planning and design by six months, being very careful not to adversely impact the environmental and the ceqa review processes that we do not want to have a negative impact on. we also look at the construction sequencing and realize we could consolidate some of the construction packages and bring facilities on mind sooner. that resulted in a six-month reduction in construction as well, for a total of 18 months off of the overall project schedule. we are presently working with staff on efforts to prepare the

environment and ceqa information as secretly as possible. -- as efficiently as possible. we're looking to get these priorities on line as quickly as possible and we will continue to expedite the schedule and those things needed for decision making. this would also include considering alternative delivery methods to further shortened schedules. an interesting schedule -- and interesting benefit of shortening the schedule is that we do have savings involved in this, due to the shorting of the schedule and the escalation that it has on the overall program. what we find is that the overall program is now just under $2 billion for the biosolid digester facilities. and the impact to the average monthly bill in the year 23-2032 would be $20 a month. that would gradually increase

over time and to reach $33 in the year 2032. >> just to make sure i have my math right, that $33 is on top of a base of $76, is that right? >> to my recollection is that it is currently $76. we're going to 274 wie 2032 and this is $33 of that. >> $33 represents a 33% increase over the $76. >> and that is a total on waste water bills. it will make a huge impact. >> thank you. >> as you may recall in workshop when we did not have the specific options, as we did for by a solid as we did for the liquid solid -- the liquid side.

these facilities were to identify the long-term needs drop the planning process. what we presented were based projects focus on reliability and redundancy and then we can see add-ons to those based projects and those included seismic reliability, and electrical redundancy, odor control, and new group facilities and processes throughout the plant. recommended option 3, which also added a wet water treatment facility to replace the existing what water facilities at southeast these projects had a total cost of $800 million and the monthly impact is $14 million per month. at oceanside, we recommended a base project, which again with seismic and electrical upgrade,

odor control improvements at the westside pump station, a redundant west main for reliable flow to the plant, great removal and a frog receiving station, the cost of these facilities is four hundred $64 million with a monthly impact of $8 per month. at north point, we also recommended a base project, which was seismic, order control, great removal, refurbishing of the existing out wall, whitewater pomp rienzi, and system improvements. these projects totaled $624 million and have and $11 impact on the average monthly bill in 2032. having completed the treatment

plant summary, we turned to the collection system. we initially focused on reliability systemwide. we then look that particular issues associated with bayside, the west side, and green infrastructure, which as you recall, we made a $400 million commitment to. systemwide recommendations include operational improvements, a pump station rehabilitation, combined super discharge out wall structural improvements and backflow prevention where needed, and odor prevention sites throughout the system. these projects totaled $838 million and we have a $14 per month impact on the average monthly bill. when we looked at the bayside system, you may remember the drivers were concerned with.

there is replacement or redundancy, regulatory compliance to get initially to the recurrence of 10 recurrences per year, but also redundancy in the future anticipated reduction we may face in the upcoming renewal process. we also wanted to incorporate green. as we discussed at that time, we looked at various sites tunnels and recommended a 34 ft. diameter tunnel at a cost of just over $1.2 billion. at that time, we also discussed the possibility that the 10 discharges per year could be achieved with a smaller diameter tunnel. since the last workshop, we have connected as bad -- additional studies and determined that the infrastructure would like to get us to 10.

however, the total cost of that would be just under $1.3 billion. in finalizing the budget for the bayside, we recommend going with the 1.29 $4 billion. -- the $1.29 4 billion. in this way, as we continue to develop this project, we can determine the right combination of tunnel size and green infrastructure to accomplish our project executive -- objectives. this would be accomplished through the ongoing watershed process, utilizing the triple bottom line analyses, and the planning and ceqa review that will be undertaken as part of the central bayside project. these analyses will be guided by the permit negotiations that will begin this fall, and of

course, the performance from the green infrastructure or the invitation projects. this project has a total of one -- $1.29 4 billion and a total impact of 20 two dollars per month per average bill. when we move to the west side, we focus on the csd discharges along ocean beach, lincoln way, the 70 -- vicente and merced. we had an average discharge our current of 3 per year to the bathing beaches. in doing these analyses, we focused on utilizing the transport storage boxes, the website pump station, and the existing out hall.

we looked at various pop stations to get as to the target of three. you may recall that we had 100 stations at a cost of $277 million. we also discussed the possibility that a smaller pond station with green could get us to that target. based on initial analysis, that has been determined that with three could meet the target of three. the cost however would be $290 million. we recommend the two hundred $90 million with the $13 million difference from the $277 million, again, being allocated from the infrastructure $400 million commitment. again, as this project is developed, we can determine the right combination of pumping and infrastructure to obtain its objectives.

this will be using the watershed process regarding the triple bottom line and will also be once the discharges are finally sat and on the early in the mentation of the performance of green. when we summarize the green infrastructure, we see it plays a significant role in the strategies of the collection system. we start with the four hundred million dollar commitment that we have made. we're looking at $57 million for the eight early implantation projects that will be implemented across the city. we're also going to have $6 million committed to ongoing citywide planning. that will leverage the results

of additional projects, and identify additional city projects that warrant implementation. you can see the allocation of the $51 million and the $13 million to the central bayside and the west side pomp station projects, with the remaining two hundred $73 million available for projects -- $two hundred 73 million available for projects throughout the city. these projects would have an impact of $5 per month on the average repair bill. in summary, when we presented our final costs at the end of workshops 1 and 2, we identified about $3.9 billion for treatment costs, and about two $0.7 billion for system collection costs for a total of the $6.998 billion.

in total today, the treatment is now $3.8 billion. the collection systems cost said the same. -- stays the same. and we have a total of 6.9 $3 billion for the overall -- $6.93 billion for the overall ssip project. that is all we have today. if there are questions, we will respond. >> that does bring us up to speed as to where we are. i think, questions or comments from the commission? >> i just want to make a couple of comments. first, i want to say thank you and i appreciate your work to accelerate the work in the southeast.

i know that we have heard a lot from the public over the last two meetings, over the many years actually, about the importance of bringing items online. i did hear you say you will continue to work to accelerate those projects in the southeast if possible. i would urge you to continue to do that. i want to appreciate your efforts in that direction, because it sounds like he will be able to bring as part? online earlier than anticipated. i want to thank you for that -- bring those projects on my earlier than anticipated. i want to thank you for the green projects. i feel like after looking at the level of service and the goals, and particularly, the added benefits that will come from green infrastructure, that we are integrating that with the gray infrastructure.

that makes a lot of sense and i know how hard it is -- has been to crunch those numbers and look at all of the different outcomes that will work. i want to applaud you for that. i wanted to give those two comments to contextualize and open it up. thank you, mr. chairman. >> thank you. other comments from commissioners? >> i did not quite understand why moving up the timetable for the digesters can save us money. that is question no. one. and question no. 2, if that is the case, how about moving up other parts of it? with that a bus more money? >> very good questions, commissioner. the reason is tied to escalation. because we're looking at a lengthy time frame for implementation, we have

assumptions of the cost of this over time. the costs of this program have escalated at 4% per year for the first 10 years and 5% per year for the second tenures. and just moving those digester projects earlier in the program, that is a $65 million savings. that is dramatic. when we look at the total program, it is even more dramatic in that of the $6.9 billion program, about $1.6 billion is escalation. absolutely, the faster we can get projects online, there will always be opportunities for savings. >> i have another question. the tunnel, the 30 ft. versus 23, there must have been a reason why you first thought 30 ft.. will the 23 suffice? >> the way things will be look

bad -- will be looked at is that right now, we do not know what size the tunnel will be. a lot more study needs to be undertaken. and the future regulatory requirements will play into that. what we have looked at is the 30-foot tunnel gets us to 10 by itself. the greenwood also get us to 10. the issue we want to look at here is whether there is another combination. does 28 give us almost to 30 and with another combination of green? we have looked at this through triple bottom line and through the regulatory process to get us to that. we want to look the future flexibility requirements that the operators need to maintain system controlled during wet weather events. all of those things will be