>> any other comment for communication on staff reports? >> the next item is a happy occasion, we are honoring a leading member of the community and a very important community organization for providing service as well as adopting a schedule of regular meetings. if i could call mr. de los rey to the podium, the manager might like to make a couple of brief remarks. >> the advisory committee was established to bring in our efforts to provide opportunities for small locally based construction companies. it was our staff that served for the past four years, the distinguished career highlighted by the contract and labor compliance program for many years. shaping up to the committee,

with our recent project. he is retiring from the committee, wanted to extend my best wishes to them. >> can you come up here, please? >> either end. then we'll take pictures. [applause]

>> i sincerely appreciate the tremendous support, most of all the special opportunity to serve on the small business advisory committee. on behalf of the local businesses in alameda county, i would like to express to you the many comments i have received, especially from some of them that were about to go out of business until the project came along. it is tremendous, the type of help and dramatic leadership the general manager and his leadership has provided.

the staff has been very tremendous. the sun is shining out there and we really appreciate the tremendous help and support. thank you for the opportunity in creating business and a workforce development in alameda county and in the region. thank you very much. [applause] >> thank you very much. we have a second item. did you read it? >> the next item is honoring the ohlone humane society refuge center for its work related to its work at the water treatment plant. >> when we are disturbing so much around this part of the world, we sometimes run into difficult situation. we have had one particular group help us tremendously.

what happened here is that last summer, we found some active swallows' nests which made us stop all of the work. not knowing exactly what to do, we contacted these fine people and a tucked the nestlings in a very appropriate way and raised them and took care of them and we now have 15 swallows that have been hatched and raised and we're very grateful. this includes feeding the birds until they were old enough to leave their nest. it allowed us to save the birds and do different construction projects. [applause]

>> thank you very much. [applause] >> commissioners, the last item on a matter of administration businesses the formal adoption of for the year 2012. this room has already been reserved for our use for the rest of the year. if the president might entertain a motion to approve the schedule of regular meetings, you will

notice i did not schedule on december 25th of next year. >> i noticed you put the date as october 252. did i miss that? >> that is what it says. >> can i have a motion, please? >> so moved. all those in favor? opposed? the motion carries. the next item is the report of the general manager. >> there is one item there -- just to respond to the question on the contracts, we are still working on those signs by october 31st. >> it good afternoon, commissioners.

the report covering july, august and september will not be ready until next week. because of scheduling comment -- conflicts, want to share a highlight the would be in a report today. some of the data i will be presenting is still being verified, but i don't expect any major changes between now and the time the report is published. this chart confirms the great progress being made on the local program. we have completed the construction of 35 local projects. construction is currently ongoing. we are at 64 million and the seismic upgrade is the only local project that has yet to move into construction. it will do so in early 2012. the local program is 77%

complete as of october 31st. progress on the regional program is also going well, with the greatest value of our project currently under construction. during the reporting time, we just drove surpass the $2.5 billion value in projects and construction. we only have six regional projects yet to move into construction. as of october 1st, we have completed the construction of 21 regional projects. that is getting close to half of our regional project. based on expenditures, the regional program is 44% complete. if we look at the overall variances, a reminder that that is a difference between what is being forecasted by our team

verses what was approved by the commission. keep in mind the approved budget figures by which we compare our forecasted figures includes the additional construction contingency that has been approved in recent months. the numbers are the cost overrun, the ones in black are underruns or savings. if we look at the regional project, one can see we are forecasting regional program costs to be $1.3 million more than the approved budget, a decrease of 900,000 on the cost overrun projected last quarter we're still forecasted to deliver the regional program on schedule, july 2016. the last 2 columns report the variances on the local programs there.

we are predicting an underrun of 1.1 million over what was approved. the completion date is the same as what was approved by the commission. this is a chart comparing the total forecasted program in blue to the total program approved budget in red. the approved budget, the red line includes the program management reserve for the forecast does not. he essentially, the delta between those two lines are the program management reserves. we are tracking well below the budget approved by the commission still. the overall program costs since the last quarter went up $14 million, due to the initial construction contingency

approved by the commission for the datavision pipeline approved at the last commission meeting. for the first time, i wanted to show you a report on the transaction in and out of the program reserves. the numbers on the last column in red are the monies moved out of the reserve since the program was approved in july. on the left side are the savings moved into the reserve. since the program was adopted, the commission approved an increase in construction contingency. these were partially offset by savings on one of our contracts for the pipeline system. the delta here is $15.8 million reduction in reduction over the

last quarter. we're still left with $146 million reserve at this point. during the reporting quarter, we achieved a number of noteworthy milestones. we advertised construction contracts and initiated construction on four different projects. the eastern section as well as the dam replacement. we also achieved final completion on five construction contracts. there has been an increase in overall system reliability as a result of the contract being completed, when you think about the bike tunnel, the balancing reservoir and the pump station upgrades have all been completed and these facilities are back in service. some of the greatest challenges

we are tackling are summarized here. the first project is the only project that remains in 3 construction. the scope of that project was modified to include additional soil disposal sites for that project. that resulted in a slight delay in the draft eir, but that should go out for review in early january. the ground water condition is something i've talked about, but it has become a greater challenge now. not only are we seeing more ground water than was anticipated, but we've discovered the water has been contaminated by fertilizers. we're working right now what they're contractor to find a solution to dispose of the water

directly on our right away, which will allow us to do so without treatment. we are assessing the cost and schedule impact as well as the solution as we speak. to build the replacement project, we will have to excavates 8 million cubic yards. half of that will be reused for building the dam. we have recently discovered soft ground condition at the largest disposal site and that will require we do more work on site to be able to build a rock dike around the reservoir. we're looking at cost and schedule impacts from that on the very beginning of construction, which is unfortunate, but it is a situation we must deal with. we have struggled with it

difficult ground condition on the new tunnel which has impacted production rates. the good news is by working at four different headings, we are able to make up time there. finally, i wanted to mention we have discovered some quality issues with some of the wells. the contractor is not disputing the fact that there is a quality issue, but there is some disagreement to repair the efficient work. we conducted an assessment to identify which segments have to be repaired and how to repair the defective welds. the corrective work has begun and i would like to mention this quality issue has delayed some of the restoration on the peninsula, but we have started

the restoration work as well. the revenue board oversight committee retain the services of the independent panel that reviewed our program in late 2010. the panel was comprised of four national experts and was asked to review the program and focus on three specific areas the panel was here in early october to conduct the review. the preliminary findings they shared with us were very positive i'm happy to report. the panel was very impressed by our procedures and processes as well as the overall execution. they were pleased with the way the projects were executed in did offer some constructive recommendations we will certainly follow up on.

the final report of the panel will be available in mid december, and we have asked the chairman of the panel and professor at stanford to give you a presentation on the findings there that will be done in january. i wanted to end my presentation as usual, a giving you the ability to look at the work taking place there. the installation of the pipeline is progressing very well. we have weeded de 7.3 miles of the 10.35 mile -- pipeline installation. construction activities there are 63% complete. but this is a project we have some in queues -- some issues with contaminated groundwater. we are well ahead of schedule,

so i don't expect that to impact final completion of the project. this is a photo of the new tunnel. by working multiple shifts, we are making up time and we are now finally achieving the production rate as in the base line schedule. we have tunneled more than 2,200 feet out of the tunnel. this is nice to see -- degrading work taking place at the calaveras dam. the biggest challenges there will be to deal with the restriction associated unnaturally occurring asbestos as well as with a new storm water regulations. you should be where the dam is only one of two projects in all of california that received a risk level 3 project

classification under the storm water prevention regulation. that will certainly make our work even more challenging. the other thing we need to deal with very carefully is working closely with enterprise to have them lower the reservoir level to accommodate our work as much as possible while not compromising the operation of our system. it is going to be a fine-tuning to try to meet both objectives there. the progress being made at the water plant continues to be very impressive. it has -- as shown the construction of the new chlorine contact basin. we have just completed the tunneling of the new pipeline under the creek. that was done without any problems. we are 50% complete in

construction on that project. the excavation activities on the bay tunnel have been on hold for about a month now to allow for the addition of various backup units behind the tunnel boring machine cover head. this is the first of three stops that will need to be done to add the various components behind the machine trailing gear. once completed, the whole machine will be more than 600 feet long. we anticipate to have the whole gear in place by february 2012 and we anticipate we will be able to borrow a production rate that should surpass what is in the schedule. we're very pleased with our progress on that project. our construction effort on the pipeline three and four crossover is focusing on two separate sites. this photograph was taken at the

bear gulch site. work has already been completed. construction activity is 24% complete. i recently attended a few construction meetings to verify everything was on track and i'm pleased to report no major issues so far that would require management involvement. the work now is focusing on the massive excavation and the wall that will be needed to build the 11 million gallon reservoir. we are proceeding with the demolition of the sedimentation basin as we speak. as of mid october, work on crystal springs number to in south san francisco was

completed and was successfully put back in service. we're beginning work in hillsboro, adjacent to some very affluent areas and sensitive creek habitats. to deal with doing work in such busy urban area, we're being very proactive with our public outreach by involving all impacted businesses, homeowners as well as city staff, keeping them up to date on our activities. the project has its own twitter account and blog which receives a lot of traffic and it is a great way to communicate. construction is 20% complete. we have work taking place at several different sites on the watershed. you see the foundation of the pump station which will be built in close proximity to the existing, station.

talking about the crystal springs dam, here is a photograph of what the site looks like now. we are on track to reach substantial completion in early november which is required to satisfy some of the environmental restrictions. the project will have received over a thousand truckloads of cement. some pretty massive work taking place in the field, but all in all i'm very pleased with our progress. >> a very favorable report. any comments? do we have a speaker?

>> it good afternoon. very nice report. let me tell you what is not set in that report. welding. laws in welding. the program that has been influenced by the puc, on august 20th, 2009, i raised this issue. let me read to you. i knew this was going to be a problem. i raised the issue in an e-mail and the answer came back -- i visited the boston harbor project yesterday. they're using the same approach we're using an very huge success story over there in boston, not san francisco. this is the thing i warned about, using the contractor and having the contractor be in

charge. the puc does not save money being involved in this process. welding is not a small issue. once you weld the pipeline, the pipeline as weldon. if it is covered with concrete liner, it becomes more difficult to retrofit and take corrective measures. the solution right from day one was to hire the right people. you might think i am rude, but i am frustrated for dealing with a staff that knows what the problem is and not of them ever want to approach it and say this is wrong, let's correct it. here is another proposal for auditing services. no answer. they simply do not want to tell you what is going on. all i am saying, commissioners, the people of san francisco have paid for this program and they need to know what is going on. thank you.

>> thank you. and the other speakers? >> commissioners, let me start with the water system improvement project. some years ago, we had the community was involved, much more deeply and intensely that it is now. why am i saying this? when we started the water system

improvement project called for the first time, we heard it would cost billions of dollars. $2.4 billion. everything is in billions. what i am saying is this -- we have some leadership, but they should have a vision. what i am saying is when the sewer system project starts right now, we should have the right type of training for our young people. that is what i am focused with. too many young people are dying all over san francisco because of opportunities. i am talking to some of your

higher management with some projects that i hope will save lives. i'm looking at these pictures, and engineering and maintenance, operations, it is not something new to me. i retired, but i can go back. we need, commissioners, when you're talking about this $1 billion and we have 2% for art, we need to be compassionate and think about our young people that are dying. our young people that are frustrated and want a job. i'm not saying you have no compassion. some of the do. but the burden has been in the southeast sector and the western addition. too many young people have died.

i'm talking to them. over 150 meetings. if you want, we can sellout this room and even have 1000 people outside. what i am saying -- give me 20 seconds, please. thank you. we need to work with whoever is in charge of the outreach, to contact the right people and make the right things happen. i know commissioners some of you have your heart in the right place. please do that. thank you very much. >> thank you. >> madame president, members of the commission, i just want to return to the subject of the performance and the project for a moment. that is to say we work closely