volunteers. a lot of community development is part of that. we have some joint responsibilities. first of all, creation of a work plan, including the lake merced watershed report. one thing from our perspective that is very important -- the line with the work orders, we look at how the money is used so puc is given the maximum benefit of those funds. one thing we identify is a meeting annually with stakeholders to go over our expectations for the year, and what we are doing at lake merced. one of the contentious items around the lake our responsibilities for the leases. currently, rec and park manages

all the leases at the lake merced tract. that includes the hard the golf course, which is technically now leased with the pga, and for the boat house. i would also have a responsibility for issuing rfp used for recreational opportunities. we would also participate in rfp for use of the bauhaus. on the pc side, and -- the p u c side, we look at the area on the south side of the south lake, where the issues are recreational to some extent, but there are watershed issues. we think it is important we have to take on those issues directly. with rfp's, we are talking about management of the watershed in a way we believe would directly

affect the quality of beneficial uses of the lake. we have a public process regarding the memorandum of understanding. we should draft the mou in mid july this year. the watershed committee and citizens advisory committee had a public meeting at the clubhouse. we met with the public parks and recreation open space advisory committee, prosaically called prozac. we have updated the subcommittee, and we met back on november 1. we have gone to various changes to the mou, and have become better over time, resulting in the product today. moving on to the watershed report, i will not go into detail.

this is for your general review. this was a stockholder-driven process, an assessment of the lake merced watershed. there were lots of recommendations for improvements there. it is not a specific plan, where there were a set of "thou shalt do this." there are generally ranges of possibilities anticipated for various uses around the lake. we are bringing this forward not as a plan to adopt, but as a document that would provide a strong basis for going forward to develop plans, which could have their own see "review before decisions were made. moving on to the harding road about house -- but house -- boathouse, it is basically

broken into two levels. a main level, which for many years served as, in effect, a sports bar, and was reported from some of the people who work at the puc. it was a jumping joint back in the 80's. the upper level has not been in use since the early 2000's. the tenant walked away from the lease and now is currently used for storage by the recreation and parks department. without mincing words, it is a dump. the upper floor is not attractive at all. in fact, the pga, when they hold events there, and set off with opaque fencing so people do not have to see it on the way to

harding golf course. it is not a good thing, and something needs to be done about it. we are investing funds in the harding rowboat house -- road boathouse. we are working on rudimentary cleanup. that started yesterday. the contractor went inside to remove the debris and garbage that has been there since the tenant walked away a while back. we are working on some building share -- show repairs. the work is in great shape, but the bathrooms were in disrepair. they represent a problem that needs to be dealt with right away. for the rest of this, let me point out the top floor. the bottom floor is where a large number of cruise region of

rolling crews are tenants of the boat house -- a large number of rowing crews are tenants of the boat house, and store their boats there. this is not the long term, but house -- long-term boathouse i think lake merced needs. this would be a facility that could operate so that while collectively we are developing a plan for no facilities -- new facilities, we could find something reasonable or presentable. we have perceived add? -- add-backs as part of the budget process. i keep saying harding. lake merced add-backs of

cumulated over time, so we are currently investing in this effort. about a third of that is going to the bathrooms. additionally, some of the -- >> we are updating the commission on the harding but house today, but there is no action item. >> there is no action item on this. it is a significant activity we are gauging -- in beijing during the existing budget. we can make that space available with rec and park for potential use, based on a to be issued a request for proposal. for example, a concession for recreational fishing or limited food service.

there was interest in using this as part of the restaurant space. the building is not in good space at all, and required tenant improvements to make it an attractive restaurant. it needs to be more functional, related to the lake. there may be expanded use by recreational tenants. they would like more space for storage. how do we relate it to the lake, and the condition of the lake overall? that is important to us as part of this package. the harding road boathouse is under way. >> you are up about 5 minutes. how much more time the need? >> about three more slides. >> ok.

>> this has been a long-term issue out there and is one of the primary concerns going back to the mou of the water levels in lake merced. historically, they have gone down as a result of drought and groundwater pumping. the city had been working with various golf clubs in the area, and environmental stakeholders, to come up with solutions. one option was to take golf courses off of the ground water pumping, and move into waste water. that has had a salutary effect. we are working on the flood control project. the vista grande project is encompassed by the yellow- outland areas there. at the top, that little dip in the middle is where lake merced starts. in effect, we have cut off like merced from all the water that

drains to it. the daly city chunck echoes out into a tunnel into the ocean. none of it goes into lake merced anymore. on the san francisco side, we have cut off the san francisco drainage. and we wonder why the lake levels go down. even my 17-year-old can figure that out. one of the things we are working with is a project represented in large part by the blue line. it would take water from the watershed and run it through a treatment wetland area, and then through a structure of some kind, to be designed. it would discharge amounts of that into lake merced. really extreme flows would go

through the ocean, but it would be moving water through the lake, and that we you have a better chance of maintaining the like levels, as opposed to hoping for the best. we will be working with daly ity to look at alternatives of how to move water there. with technical report been done in their eir, we will look at how to execute the technical work. you all, as part of the approval process for their project, will establish what we think is the proper level for lake merced, and how their project can be operated to maintain the level we desire as san francisco. that process will move forward

and come to fruition over the next couple of years. in conclusion, we are looking forward to agreement on the mou, so we can move forward on a number of things. we are definitely continuing to pursue water level management and botha's improvements. we totally intend to build on the basic watershed report, and increase puc oversight and management of the like. in closing, there are staff here from the recreation and park department that are available to comment, if you so choose. the recreation and park department is scheduled to consider the mou during the month of december. they have a committee structure. they will take it up during the first committee meeting, at the recreation and park commission meeting. i am available to answer any questions. >> i have a couple of questions.

i guess i will start backwards. on the vista grande project, is there a projected cost for that? >> i cannot bring it to mind of the top of my head. -- off the top of my head. potentially $180 million. it is a big project. they have significant flooding issues to deal with in daly city. >> would that be a cost-sharing arrangement? >> so far, no one has approached us about sharing costs. i would fully expect an approach for cost sharing, but we have not gotten to that process. daly city just went through the alternatives analysis report and identified this project as the preferred alternative. one of their other alternatives would be building a bigger tunnel out to the ocean to move more water out, which as we all

look that it did not make sense. we should make use of that water first in the like. >> if it is $180 million, has there been discussion of how that would get paid for? >> daly city would pay for a portion of it. at the time the analysis started, there was hope for some sort of funding from the state or federal governments. there may still be hope for that. i fully anticipate that we will be asked to contribute to that project. we have not had any substantive discussion about that. >> i did see in the early resolution from 1915 -- 1950 that 27 feet was the optimal level for the lake. is that correct? >> that was what the puc stated at that time. as time has progressed, the world has changed. we need to make sure as we go

forward with this project we either maintain, or try to maintain that optimal level. you end up with a range. you do not have a set level. would it be exactly that? i think we are looking to more the technical analysis through the eir, and have come to the conclusion of is it back? is it a range around that? is it lower or higher? commissioner vietor: what is it currently? what is the range? >> i do not know off the top of my head. it is around the 27 mark. those are agreements, but what is it actually at is the question. commissioner vietor: so it is actually 25 to 28? >> i do not know right now. i apologize. commissioner vietor: maybe you could let us know, come back in the process.

the boat house has been vacant for how long? >> eight years. commissioner vietor: at the time, was that a revenue generator? >> it generated some revenue. how much, i do not know. the tenant leaving gave the indication it was not enough or he had other issues. commissioner vietor: i know there has been a lot of discussion over that, to pay for some of the expenses. >> one of the things we concluded was that the revenues should go back into the lake from rec and park activities around the lake. it should not go elsewhere. >> i think in the past it did make some money for rec and park, and it is doubtful much came back to the like.

-- to the lake. i think the idea is if you make money there, it should stay there. commissioner vietor: and it would go back to the items in the mou? >> it would go back to rec and park, but it would be used on site. commissioner vietor: this seems to be for some basic repairs, right, to the boat house? is it all for the boat house? >> it is for the upper story of the bauhaus, renovation of the bathrooms -- boat house, renovation of the bathrooms, basic cleanup of the inside and additional repairs. it does not make a finished space a tenant could walk into at this point. we can either, through an rfp, get a tenant to make apartments, or through additional funding from the puc or rec and park,

bring it to a level where we would find it functional for ourselves. commissioner vietor: the sense is that needs to be spent to even lease it. >> that is the sense. we think it is important to have a new boat house. we think it is a long process to get to that. we need to do something to make this space functional on an interim basis to get to that point. commissioner vietor: having sat in on a couple of lake merced meetings, i know there was quite a bit of discussion around rec and park. to date, they have not stepped up to the plate in the way that the puc or community would like, as far as maintaining and taking care of lake merced and bring it

back to its, at minimum, their level, but at best, its former glory. does this mou address those concerns squarely? i know we will be hearing some public comment about it. i guess i understand that one of the core competencies of the puc is not around recreational activities, but we are sort of developing and building a better realistic program, after much discussion. possibly, it make sense, at least from a leaseholder perspective, to be the ones who are entering into the lease arrangements on the variety of leases held out of lake merced. i guess i would like to hear a little bit more from you on the conversations. it does seem like there is still a division of lee's holding in this mou -- leaseholding in

this mou rather than the puc taking over the lions share. >> it calls for a continuation, to some extent. the leases and agreements break into three. the harding road golf course, which i think everyone has agreed the improvements were paid for out of recreation and park funds in a big way. that is a recreation and park deal. that belongs to the recreation and parks department. the harding road boathouse is primarily a recreational activity. there are issues around that. since we do not really deal in recreational activities, that is something rec and park primarily does. we believe that primarily rests with them. however, we think we should be a party to that, to make sure those are like-oriented

recreational activities. -- lake-oriented recreational activities and do not violate our watershed programs. third is the john your road site. -- muir road site. that property relates to the lake and management of the watershed. we are taking on responsibility for that lease. it is broken into the region into those three terms. >> can you separate that from the rowing club? >> the tenants are well established. things seem to work. one of the great concerns the rowing clubs had into time is

the new docks. those have been in use for a couple of years. >> would it make sense for the puc to be in charge of the bauhaus, but not working with the rowing clubs? >> who would have on other boating activities -- kayaks? sailboats? we could expand the use of the clubs to the upper floor, because they have needs beyond just what their boats are. the third is a more general public having a space there that could be used as partly

interpretation of the lake and the watershed, used for meetings of the various kinds for the department, with all its possibilities. we think it is primarily rec and park, but we would want to be involved. >> this topic has been around -- commissioner caen: this topic has been around for a long time. i wanted to feel comfortable that in the mou the duties were defined properly. i get the feeling, when i perused it, that we were sort of falling over rec and park and they were falling over us, and we sort of became the policeman of the area, of the lake.

i do not know, and i just throw this out, if this works as two entities running the area. that is a question i do not have an answer to. >> one of the things that i would say is that i think puc has work ordered money to rec and park for many years for support services. i am not sure that either party has done a good job of accounting for that. we are making sure we get value for our money and they are making sure they provide value for services they need, but maybe have not made explicit. we want to make sure we get that a lot clearer, so we can say clearly that we have the money for this and are getting our value back in the recreational uses supported by their support services. i think we have not looked at it closely enough.

one of the things i would certainly intend to do in the water enterprise, and approve potentially this year in the budget process, is to identify a single individual within the water enterprise, because there is not currently one, who is our management representative for like%. if i had to point to one individual right now, it would be me, and i do not have the time to do that. we need to change that model real quick. i know that. we have not had an assigned person to deal with like merced. we have dealt with like merced issues -- like merced issues, but have not -- lake merced issues, but do not have a management for us. commissioner courtney: i am concerned about making sure -- commissioner caen: i am concerned about making sure everything is clear cut with

management responsibilities, and i am not sure if the current mou approaches that. commissioner vietor: i echo those concerns. that is where i was going a little bit with it. it does not seem all that clear on who is responsible for what. i think that may be part of the problem we have seen in the last number of years, with the dilapidation of the lake. i do not know what the clear delineation really is. it seems like what is being somewhat proposed is around the puc being a landowner, land manager, landlord, with rec and park being somewhat of a tenant, if you will, a subcontractor who deals with the recreational aspects of this. but it does not really seen that clearly reflected in the current mou, so i just wanted to echo those concerns. >> i had a couple of questions

that are in the same vein. i think you may have answered it, but i did not get it. the $940,000 -- whose money is that? >> that is puc money. it was added back in the board of supervisors project, where there were budget cuts during the process and then individual board members asked us to do additional work. >> this is ratepayer money? >> yes. >> one thing i was not -- there were a couple of areas that raised questions for me. one was in the plan itself, not in the mou, but in the plan. it talks about the need for making facility improvements, and in some cases new facilities. i guess my concern is that somebody's expectation is that we are.

the other flag is that i could not tell if there was a transfer of responsibilities. i could not tell what the dollar impact was. there was no performance statement of what would be responsible for, and nothing offsetting that as far as what rec and park would be responsible for. i am concerned about the blank check aspect. i would be concerned about the obligation we would be getting into. >> first, on the change of responsibilities, with the responsibility of a specific lease, we would assume revenues from that. but again, we have to deal with the property. >> that is not a change. there is not an expectation that rec and park would ever do with that.

>> we have no revenue. we have liability associated with that. there is revenue. as i mentioned, the work order for $300,000 -- we both share responsibility with rec and park. we know there are limitations on that money. we can only go so far. if the puc expects more, they would need to provide additional resources. thirdly, relative to the expectations in the watershed report, there might be new things that would come from a variety of sources. there are always hopes and desires for bond funds of some kind or anothe