so it is an odd pattern those conditions are this year. >> this is our total deliveries and last week our demand was up again, it the city below 2014 that is acceptable but we're at the point we're starting to work and establish a campaign building off the last drought campaign as we ramp up towards summer get the word out that people have to continue conserving we're in a deep drought the worst drought and make sure that message is loud and clear our total water sooifgz we are ahead of the curve this time last year we shall trailing that's good news the line is flattening out we're not savings

as much we need to turn strongly soon to a communication campaign to reach out and make sure we're getting the message our with wholesale customers are using the wholesale areas we're going to or have the retail services in the month or so. >> some things happening out there first on the control board less tuesday at the extended their emergency instructions they adapted and averaged some eliminating the number of days per week that outdoor watering can occur and drafted for two device per week they changed that again to a selected number by water agencies in achieving a certain reduction in use we'll be grappling with that and have

our regulations the second week in april a plan to how to consultant that measure the water in restaurant only upon that request in san francisco as hotels must offer meddles for laundering we have the restrictions in place and prompted from consumers if leaks are detook a look at on their property starting on april 1st we're going to identify the continuance con stumps u summation we'll use a water meter to - send a postcard it looks like you have a leak you should do something about it other things going on with the

corresponded or reports we sent a letter on march 18 indicating we were interested in the potential water pretty much that's the south san joaquin and other districts and the turlock district and merced we received a response from modesto that said they're not in a position to sell water we'll get a similar responses from merced their situation is a dire with the merced he river we hope we'll get positive response from other agencies and send water to us last wednesday the recycle water draft eir that is on president's table that project is underdevelopment for sometime and in the package of recycled

water but the golden gate park and take the wells and convert them one the things we're evaluating is driver's license a way once we get through the eir period can say we accelerate those projects to bring them online this elevation a going on lastly actions by another water agencies actually i'll be going to the santa clara board meeting their commissioner moran for severe restrictions like 3 percent restriction on use so we will be talking with them and others before the implications their situation is one where their worse off than us in terms of storage so we have a lot of concerns it is back to our storage slide the use of water

bank we're in a better situation but at least we're positions relatively well so we're going to continue for sure the 10 percent water reduction through this year we demanded no more than 2 hundred and 9 modified per day of it's an extreme dry year hetch hetchy will be potential near that and under our agreement with our customers mid-april we make a determination on the water outcome for the year we have hard decisions it will be around that timeframe and i'll be happy to answer any questions. >> commissioners yes. >> steve what do we know about san franciscans use and i'm thinking of two things the 10 percent

that was i guess combined. >> that was combined. >> as far as the people that live and work in san francisco how are we doing. >> doing pretty good a couple of things last year, we called for 10 percent pauts because it's primarily indoor use san franciscans achieved 8 percent where the wholesaler customers have more irrigation reductions we anticipated that san franciscans were you pretty much on target as far as the per capital each month and are blue bars that everyone reports to the bar in san francisco we retained over the passport six months between 46 gallons per capital and 39 gladdens as a low all the numbers in that range are the lowest in the state san

franciscans are going a job. >> what about indoor and outdoor use can we track that for 0urd irrigation. >> we adapted the 10 percent reduction on irrigation accounts so we i think we're about to send out a letter or maybe just sent it out to folks that have accounts a lot of them have reduced to 10 percent some not we put them on notice by the end of the fiscal year they'll on the one hand owe us excess feeds that is something i want to insure it is a clear warning. >> we have a curtail provision in the use is egregious we'll do shut offices on the account. >> i don't know if we have this

authority already certainly the dollar finger figure i know we have one retail out of san francisco they're concerned that the baseline was inappropriate so we worked with them on a different baseline but they're releasing they have to pay they want to make sure it is closer to one hundred thousand than ethiopian $10,000 arrest the wholesale customers sometime swamp the city numbers i want to make sure that the people that are san franciscans who we have the most direct relationship what we are doing what we can to make sure their doing the right thing as well. >> particularly for the last year we have a steady 8 percent for the entire year the san franciscans is a good number.

>> there's no way we can distinguish between inside and outdoor use with the customers correct. >> only for those who have dictated the irrigation account we generally have a pretty good idea for more folks particularly those who are apartment twerlz very few landscaping it is almost exclusively indoor. >> how much. >> we figure for most we have a factor about 10 percent of the water bill goes to irrigation so 90 percent is indoor use that's the basic rule for all residential use in san francisco confusing the irrigation. >> yes. vice president. >> have we ever considered not

issuing additional water meters for a period of time? >> no all of our projections indicate we have ample supplies to provide for san franciscans. >> more or for all projected growth and druth situation. >> yes. our current design dwrauth and we'll continue to make sure we can continue to do that you know we will be looking at the drought continues we'll look at other options that are extreme conservation. >> so cost wise with what do you mean. >> i mean i've point our storage is in good shape if the drought continues for 3 more years we'll get to dangersly low

levels and the alternative supplies generally fall into the direct and direct quotable wastewater. >> so the potential moratorium on wastewater meters. >> that's not something we in san francisco think it is is right kind of control measure. >> also when development comes from the planning process we evaluate the water use our allotment we have room we look at our normal allotment we'll have do that in the planning process i don't think it would be a good thing someone build a project and at the last minute we hold it up. >> it's time to explore the

range of where we might end up if this mega drought continues. >> beyond why additional water meters would alleviate the problem with additional water use for more hookups. >> we'll say no more hookups not enough water it doesn't sound like that's been on the table let's hope we don't get that. >> when we do certifications for development part of analysis says in drauthsd there be occur contaminates it's to the an unanticipated factor not what we use to decide whether someone can hook up or not so given the

fact of life that's built into the process we have to withstand the curtail time after time and it shouldn't be more than 20 percent i think that will be our right to justify the curtailment. >> any other questions or comments. >> thank you, mr. richie. >> those are quarterly updates. >> good afternoon, members of the commission i'm the general manager for infrastructure you have before you the quarterly report for the hetch hetchy system improvement program as well as for the watermelon enterprise cip i want

to point out four projects for your information with respect to the hetch hetchy cip program small hydro university mound project is in changes because of the cdcs request for the changes we're moma those changes and it's increased the costs so we're reevaluating the return open investment and making a decision whether that project will move forward with respect to the street lights project we have had some details in implementation of the street light project as well as cost increases by emergency work by the storms in december and need to divert crews to address street lights that were impacted as a result of storms but back

on schedule and moving forward physical evidence with respect to the projects sorry i forgot my glasses the low monitoring projects those are detailed as a result of the inter - yes. i will take those thank you, donna. >> she has to do everything (laughter). >> just give her your paper. >> the interconnection agreements we're dealing with the interconnection agreement is coming to an end to put the resources and as a result of those the metering and low monitoring as well as the assessment projects are detailed those are the 4 projects that

have red dots in the hetch hetchy and with respect to the wastewater cip. >> can we stop and take questions anybody questions for hetch hetchy yes. >> thank you one question i've asked sometime ago whether we're using the appropriate metrics for the projects hetch hetchy is one of the places we have one that caught my eye whether there's a lot of projects it's hard to tell whether or not we're on schedule cause we've put so many things together i don't know what the tournament metrics are but we talked about that before we gave thought and how are we persuading. >> as it relates to the hetch hetchy project we're in the process of developing and articulating the hetch hetchy program very similar to what we did with the water system and

the sewer system to and from program it is true we have a collection of projects in hetch hetchy tradition move forward as a collection of projects but we're doing this year in 2015 and hope to be done in april to bring is to the commission by november is that same delivered approach on the water and wastewater to develop the programs to identify specifically the levels of service goals the benefit that each project brings to the loaf and the scheduled and budgets so you see the return on investment and start to report on the problematically for the service calls it's a significant effort particularly because of the impacts with respect to the rim fire we have had details our goals in november coming with

the comprehensive program that is outside of the r n r work we continue to have in hetch hetchy and reported on separately. >> one the difficulties when i have that many little promotions it looks like everyone is on time and schedule but felix on the scope that ends up being something you can't see i'm looking for ways to make sure you know projects have if theirs issues with completion those are highlighted job i don't see it. >> we're not at that level that's our goal and the inverse if you simply have a list you may pay attention to not good

investments so i apologize we're not there yet again we were detailed as a result of rim fire but our goal to bring a patriarchs approach to the work on hetch hetchy. >> i'd like to add amends the r and r fill in work you say a bigger project is detailed i have a window you may be to fit in work our staff is funded on the project that the project is detailed you'll still get a check by having the fill in work r and r it will be hard to schedule so when you have time move it up so sometimes, the r and r work is public. >> that's why i'm not suggesting a solution i recognize that's required this project is a $30 million project

more than just a full in work there should be more inches on that. >> sure. >> right so have you address the lower aspect. >> no and i cannot because of conflict of interest. >> oh okay. >> (laughter). >> okay again answer. >> we've been training him. >> is that true off the coast range tunnel. >> unfortunate yes ma'am. >> okay. >> all right. so. >> i mean, i say what happened then with a historical and preservation prospective on lower cherry the flatiron contract is in place and phase one work has been implemented aqueduct is serviceable and

we're furthering last commission we authorized the flatiron contract if we are that not making broken this is moving forward and with respect to mountain tunnel the plan is to do an investigation with tunnel similar to the coast range tunnel in order to give us more information as we move forward and the environmental process is moving forward because what we have mapped out to t that's the critical path. >> okay. thank you any other questions or comments i do have a speaker on this topic so if i could excuse you for a moment. >> thank you members of the commission nicole chief financial officer my comment for

the coast range tunnel i was pleased when i heard the inspection was implemented and went well, no surprises in the inspection it's a always good news one thing that is helpful our quarterly report obviously had a data of december 31st and the projection hopefully have a much better question do we expect that to go over that budget i hope it will not as part of the inspection thank you very much. >> thank you mr. cruz. >> thank you, commissioners yes, ma'am medical cruz with the infrastructure with respect to the watermelon enterprise quarterly report the only item

i'd like to call out the objection nation plant that project has seen details and cost increases we're working through that put simply we're run into challenges that was a project that was put out as a design built project and led by dpw and we've learned the lessons if you're going to do design build you need to leave the design to the design builder we set schwarzenegger or some dimensions as a result, it is extremely loud and exceeding our noise requirements so the details are associated with trying to deal with the noise impacts of the project so we need to do some long term fix's

we're in conversation that the design builder in order to bring this project to close you are. >> on the wastewater program another piece of business is the risk analysis for the proton program for the s i b program we're working and i'm wondering what the states is. >> i think i'll ask karen to address that as part of the update. >> okay. >> primarily again, because of my conflict of interest. >> mr. kelly. >> okay. we'll move on to the next item bond fill update.

>> good afternoon members of the commission rich the debt manager of the charles pearls is on vacation i'm here to provide a brief report on a bond sale that occurred it was a pricing that occurred about $402 million we sold a couple weeks ago we decided to take advantage of the low interest rate investment and funded bonds in 2006 and 2009 i'm pleased to state it we had very successful pricing relatives achieving in your opinion good rate paying savings in brief rate paying savings close to $29 million and on a percentage basis 10.3 percent

savings far exceeded the 3 percent threshold that's required under our debt management policies of 10.3 and surpassed the 3 percent i want to mention the last time was in 2012 so three years ago the rating agencies moody's and s&p 500 have firmed our bond rating for moody's i didn't see and double a from s&p 500 that is a testament to management over the last few years because of the drought as well as the recent vicarious ability to say not to affirm our strong bond ratings

in order to chief those results it took a lot of effort investor outreach with the local level by primarily to the constitutional investors those are the folks that buy the bond in big chunks there were a lot of people involved in the effort at the puc and water enterprise i want to give a shout out to steve richie it joined me in new york had one-on-one meetings are the bond experts and made a presentation to the bond spent as a result, the next day orders over one billion dollars that allowed us to go back to the underwriter with that kind of demand to jp morgan i mentioned

vanguard one of the largest mature bond funds in the country they were at the presentation with steve and i put in one hundred and $29 million of orders very, very effective outreach so again, it was a successful effort and we're pleased with the results if you have any questions, i'll be happy to answer them. >> wonderful. >> i'd like to say that you know to have the bond rating we do is just dprierld and for us to go back b there in the drought and convince them the water bonds are where they should be is a great feat. >> thank you obviously we're

not toy trying to undermine the drought but a lot of investors worse case scenario and the tabloid headline news steve objective did a interpretation job in awe on the same page their concerns and we're managing the drought and he mentioned we're in a better shape than other agencies so kudos to steve. >> yes. >> is there a pocket if the drought continues in the coming years it will effect our credit rating. >> absolutely absolutely so again continue with the effort when is managing around supply and managing around finances we have to pay our bills and debt service we're not alone in this situation we're amongst others and after the discussion with the agencies with the bond

investors we're able to effectively convince we're doing a good job keep us where we are they kept us where we are and bought a lot of bond. >> ho do we react to the drought you can't - we have urban reservoirs for the go math that may take tough decisions. >> also the willingness to increase the rates to cover our debts is important to note. >> that wasn't that an important consideration from an outreach moving forward it is one - >> one of the answers they asked us what if this continues and our sales are lower than projected our response we're in discussion with management and