management plan, that that is what would be cited in ceqa, that that is what will stand in lieu of a water supply assessment for any project being considered by an agency and any reference to this document would be incidental to that. >> that is a true statement. my only point was that they cannot be inconsistent in the sense that if they get water from a different source and they can point to that as part of their urban water management plan, that is fine. they cannot represent that san francisco is going to do something other than what san francisco represents it is going to do in its chairman water management plan. commissioner moran: i will be interested if we get any comments about that. my sense of the plan is as it deals with retail demand and supplies that that is its strength. and that the findings we are

being asked to make in item 11 are well supported. in the wholesale area, i think there is some significant problems in terms of presenting a cogent and correct view of the situation. one is we are dependent on information that was provided to us. we did not generate the demand numbers. we cannot validate them. we understand there are some differences in methodology that we do not necessarily understand. and we have made some assumptions that may not reflect what is really going to happen over time. i think it would be a mistake if somebody were to conclude from reading the regional section of this that the system was in balance. a kind of says that because of assumptions that were made, but i do not think it says that. we take action that affect retail only, i am comfortable doing that. we take action that has some legal ramification for the wholesale service area, then i think we need more discussion.

>> to be clear, i was referring to the action you are taking. you are only taking action with respect to san francisco's retail. each independent jurisdiction has their own standard under law that they are required to meet. my only point was that they cannot make up a different story with respect to the supply that they from san francisco. it should be consistent with yours. we have not seen those yet. that was the point you are going to review the other urban water management -- >> i would expect that not all of the urban water management plans will assume deliveries are related to 184. that is only built in 2 hours. my guess is some of the other wholesale areas may not assume. >> as with all other urban water management plans, regardless of whether it is in our service

area, the urban water management plans are focused on the local entities and retail. what we provide is a given set of common assumptions to all of our wholesale customers that they can incorporate into their urban water management plan. what they do after that is completely their own business. >> i would just emphasize that. that they were provided with a set of information that they can use, and i will have to respond to that -- they have to respond to that and incorporate it into planning. whether they go beyond that, the challenge is to the agencies. that is why it is actually adding reference to the work that bawsca is doing. any other questions? commissioner vietor: any public

comment on this item? >> we have one speaker card. >> good afternoon, commissioners. i am here representing san francisco green party and the local grassroots organization. thankfully, you have a couple of different items that allow us to address what is coming up on item 12, which is an moa about desalination. i know that you got the document fairly late on monday, but keep in mind that the reason we made comments that late on desalination is -- commissioner vietor: is this -- we are on item 9 and 10 right now. >> it is part of the water program. it is recommended in the water

program. i am hoping to elaborate on it. to speak to the issue of when the comment came to you, we did not know that this was an action item that was moving quickly until your last meeting. the letter that you got has major environmental groups on a. we had two weeks to turn around, getting groups to sign on to that letter. that is why you are getting it on monday, because we need more warning in the first place that these things are coming up. that highlights the main point about all of this, for us to consider things like desalination for the water system, we need the public and environmental groups that have worked on water issues for decades to get full buy-in on the process of deciding even whether we're going to kick some money in to the study. specifically to the items you are covering now, what we need to do with our water system as far as preserving water and

making sure that we've got enough is to not adopt aggressive technological strategies after the fact as a systematic approach to dealing with water problems. we need to employ prevention. we need to do permeable pavement. we need to restore watersheds. we need to restore wetlands. we need to open up more open space so water does not drain immediately into the day but soaks into the landscape. we need rain bills. we need a lot of efficiency programs to be rolled out. i was glad to hear you mention jobs because building is going to create jobs for a few years, but if we were to aggressively go after san francisco's water use, pavement, the entire storage system, everyone's home,

of grading how it uses water, that is what is going to create a boom in jobs -- upgrading everyone's home and how it uses water. you can buy energy or build in your community, and it is building in the community that will create jobs. all of those things are what we need to focus on. the mayan civilization and others like it collapsed because of water problems. instead of trying to use preventative measures, they opted for new or an abrasive technologies, and a just cause more problems. now, the planet is doing the same thing, so we need to refer to preventative measures and not after the fact emergency measures. >> good afternoon, commissioners. i want to commend your staff on a very comprehensive water

management plan. i always enjoy reading about san francisco's demand management measure. we have come a long way, and we appreciate the opportunity to work with staff on some of this. i also liked the fact that the plan assumes that the cap will extend beyond 2018. i think that is a very prudent thing to do. i appreciate puc's involvement in the water utility client alliance and the commitment to doing more studies on how climate change will affect water supply. that will be very important. couple of things that i think could approve the plan of it -- it seems there is a place holder for the environmental enhancement surcharge. you might have to wait until the supervisors create the actual fund, but it seems those numbers could be incorporated into the plan. second, i think it would be helpful to have a little

explanation on the pc's relationship to private water companies. especially since up to 7.4 additional mgd's will be required for in-stream flows in the watershed. addressing what happens in times of drought. thank you for the opportunity to comment. again, my congratulations to your staff on a really fine job. commissioner vietor: thank you. >> i also want to compliment staff. they came to the citizens advisory committee and gave a presentation. i would like to thank julie for giving us that demonstration. i understand it is totally complete, a really great plan, but i hope the next plan will finally be able to find a yield to non-portable sources like

rainwater harvesting and gray water and black water. that would be really great because we have been looking at these for years, and you are not going to have an accurate plan if we really do start doing a lot more of those alternative supplies. we will have to figure out how to quantify it. the next thing is i am thrilled that you are part of the climb alliance, but the piece that you put on climate change and the urban water management plan i believe is word for word from the 2007 draft eir for the water system improvement program. it would be great if there was an update on that or you left it out altogether because it is kind of embarrassing. thank you. >> 3 comments. one, appreciate staff's work with us during the preparation of the document, incorporating changes toward the end, and also even this morning. ours was one of the comments that came in after 5:00 last

night, and your staff was nice enough to incorporate several of those. we appreciate that. one item to note -- i am surprised that the prior speakers did not mention it -- in terms of drought cutbacks, it shows that san franciscans will be able to get by with a 2% reduction during a significant drought. our experience has been in the past with the bay area is in crisis, everybody gets a little bit. this is mandatory drought. i suspect voluntary rationing would be called for in any event, but it might be worth noting, at least in a future plan. finally, with respect to questions and comments, i am not an attorney. i am not going to try to be an attorney today. i would say that one of your questions was -- are the wholesale customers going to rely upon your document for their future developments? i would say no, i cannot speak for each of them individually, but i would say no. almost regardless of what it

would say. prior plan said you would meet demands until the year 2030. that is one of the reasons we need to continue to work together and develop plans that they can rely on for the future. thank you. commissioner vietor: thank you. i think there were some excellent suggestions. i do not know if there is a way to amend or modify or inc. couple of them, the ones that sort of struck me. i noted that also on the climate change language, that it was dated, and there is a way to put some concurrent language on that, i think it would be appropriate. we do not know a lot more as far as did an science goes, but we do know a little more. it felt a little sparse to me, and i do not know if that is appropriate place to put the language, but that was something that struck me that i wanted to

comment on. the urban water management plan seemed like it could use a more robust preface and intro. this is one of the responsibilities, which is to update this regularly. i also thought that this non- potable question, not necessarily as it relates to this document, but perhaps for our strategic planning session, i think those yield figures would be helpful in helping us look at the portable versus non- portable sources to be able to meet those yield members -- portable -- potable versus non- potable. >> that has been a priority for staff now, working on all of the water sources we have and some

of the potentially potable to try to quantify those. that is the single biggest question out there. we're doing work on that front as well as the policy front of trying to work to prepare an ordinance that would apply to non-potable water supplies throughout the city. we have a number of things throughout the city under way. >> great. those would be my responses. i do not know about the drought language that mr. jensen was talking about and whether that means -- whether that needs to be more specific and robust. >> part of that language is included in the agreement. he is referring to what has already been agreed upon, but there's also a language where we will meet and confer on that language and see if there will be a modification, and that way, we have a modification to the contract. commissioner vietor: ok, so that

is a separate conversation that is ongoing. >> if you look to the letter, they mentioned that they would recommend an alternative approach to the plan. >> part of this is the urban water management plan. this is now june 2011. we have been given a six-month extension by the legislature when they passed legislation affecting water in general. we will be coming back to you in 2015, which means almost immediately, we are back on the water supply plane, once we have the information and have compiled and analyzed it. working with our wholesale customers, mr. jensen mention the water supply study they were doing. that is information that will be coming forward and affecting how we look at our urban water management plan's wholesale section in 2015, which we are really talking about. i would like to make one other comment. mr. brooks talk about a lot of different issues, but we did warn the bay area water stewards

in 2004, and we have been meeting with them, and we have been very open. we have had these open conversations about water supply, where our next increments of water would come from, so there are no real surprises. now, we're just further refining those issues as we move forward. all of these things were in the programmatic environmental impact report of different alternatives, and one of the things we will be working on is what are the alternatives if we are going to make a decision about post-2018? commissioner vietor: thank you. that is helpful. commissioner moran: a couple of commons -- one is on the retail side of things, i have spent some time working with staff, understanding kind of the limits of what we are doing on the conservation front. at first blush, the active conservation numbers look a

little small. what i have learned in that process is one of the reasons that those numbers look small is that we have done an awful lot through riding coats and enforcing codes, so we are getting significant results out of those activities, and they do not show up. i also was pushing to see whether there was a financial cut off that we had established. if you have 100 options, and you rank them by how much they cost, have we decided that we would not do 20% of them? the answer to that is no. we decided there may be one project that we cut because of financial considerations, but it sounds like that was really more for performance reasons. the plant that is in front of us -- the plan that is in front of us represents everything that we

have identified as technically feasible irrespective of the unit costs, which is a pretty -- you know, that is a pretty sign commitment. i just wanted to draw that out. finally, i wanted to return for a minute to the wholesale part of it. i fully appreciate the comfort that some derive from the fact that we have assumed in here that we will continue after 2018 with the same limitation that we currently have in place. i understand that is an assumption. i understand why it gives comfort to some folks. the difficulty is that it obscures how much work has to be done to make that possible, and if we were to make a different assumption, if we were to make an assumption that we would serve water above 184 mgd, to

the extent that that was needed by our wholesale customers and was the best environmental decision that that could make, then we would have a different picture. it would not show as being in balance in 2035. would show that there is a challenge that we have to meet, to either free up some supplies or to come up with some additional supply or reduce demand, and those challenges are very real, and they are out there, and i did not want to let this pass and have lulled into a sense that by 2025 -- 2035, things are just fine because that is an oversimplification of the amount of work that will have to be done between now and then. >> i think that is true about every water agency in the state of california. commissioner moran: we have something that is different. most water agencies note with

their customers are. we have a significant uncertainty as to what our relationship will be to our wholesale customers after 2018. that puts in a level of uncertainty that most water agencies do not have. >> absolutely, i think there's a section in here that calls out the uncertainties. both the ones that all water agencies face, plus the ones about our whole positions, and we have to deal with those. that is what we will be constantly pointing people to when we talk about this plan. in response to your suggestion that we make some edits to the plan, what i would offer to the commission is if you could approve the plan with the provider so that we will make changes in those sections, those

are merely descriptive changes. they do not get at the numbers and the legal obligations. we could make some changes in that language to beat those sections up without changing the substance of it. staff would be happy to do that. >> -- commissioner vietor: if there is no objection from the commission, is there a motion to adopt? >> we need two motions, 149 and 147 -- 1491410 -- one for nine and one for ten. commissioner vietor: why don't we take item 9 first, and that is the motion we will take now, and there has been a second. is there any public comment on item 9? hearing none, all those in favor? opposed? motion carries. now, we will take resolution on item 10.

public comment? questions, comments? hearing none, all those in favor? thank you. >> madame president, the next item, item 11, discussion and possible action to authorize the general manager of the san francisco public utilities commission to develop between the city and county of san francisco and parker said investors to support the park merced project -- parkmerced project. >> i will make a brief staff introduction. the mayor's office will be making a presentation. this is another development

agreement he would have to assent to. unless treasure island, there are no easy dollars in this one -- unlike treasure island, there are no easy dollars in this one. any issues we had with the development at this point in time, you still retain discretion in going back and changing things in the future. but storm water, waste water, of recycled water -- all that is on the developer. we are happy to say we are pleased we have reached this point where we can recommend that you approve the development agreement. would you like to make a comment? >> good afternoon, commissioners. i did prepare an overview presentation. if the commission would like, i could move quickly through it, the broad overview. this is to focus on the

provisions. president vietor: great. a brief overview would be fine. thank you. >> and i brought copies as well for the commission. president vietor: thank you. thanks. >> i take it everyone knows where parkmerced is located in the city and county of san francisco? it is the far northwest county -- far northwest corner of the county. >> whose district is it in? >> this is district 7, supervisor sean elsbernd's

district. i should mention the supervisor is a strong proponent of the project. i will present an overview of the project in its totality, presenting some of the fiscal benefits for the city, and focused in on how the developmental agreements and whatsfpuc's obligations are under the agreement. as the acting general manager, michael karlin stated there was no public money involved in at this project and the sfpuc was not obligated to spend money on this project. is entirely a private effort. subject to approval by the board of supervisors, there are a

series of development agreements. i take it the commission is familiar with the development agreement. the most important thing to note is this is a contract that runs with the land. regardless of the future owners -- be they the developer, a different developer, multiple owners -- all the obligations are enforceable. and also the city in general, in compliance with state law, cannot enter into an annulment agreement unless there are substantial benefits above and beyond what would be provided. the key components of the project are transit-oriented mixed use land, a complete redesign of the street and blocks, along with the city's newly adopted better street guidelines, substantial amenity improvements come up on

multiple transportation plan would investment in uniate light rail and an ambitious greenhouse gas ecological performance assessment. in addition, our office with an outside consultant has quantified above and beyond what the city could achieve with the application of the existing ordnances. we estimate -- existing ordinances. in addition, about $220 million of affordable housing funds, we anticipate a $17.5 million annual surplus. this is after accounting for the increased cost to the service population. finally, this is a huge economic and job generator for the city. we're looking at in total $7

billion in construction activity, and over the 20-year billed out, 30,000 jobs -- build out, 30,000 jobs. parker said -- parkmerced was based on a new plan that attempts to retrofit the model suburb into a 21st century sustainable urban environments. as a mention, the basic land use plan includes the addition of approximately 7500 new units to the existing apartment units. approximately half, all of which are rent-controlled, would be replaced by a brand new replacement units, bringing the entire site up to 8900 residential units at build out.

in addition the plan proposes a mixed use community with retail, office, a community center, and a redesign of all the open space, increasing the amount of public spaces to about 68 acres. this is an overview of the land use plan. i will move quickly because i realize we have limited time. essentially we see the creation of a mixed use transit-oriented for. that is what the dark colors are toward the middle. -- essentially we see the creation of a mixed use transit- oriented core. it allows immediate access to neighborhood services like cafes and dry cleaners. it also