>> three -- thank you president and colleagues. it is my distinct pleasure and honour to recognize this individual. this is renee dunn martin. please come up to the podium. [applause] >> after over two decades of service to the port of san francisco and the people of the city and county of san francisco , and one of the toughest, most underappreciated jobs, as the head spokesperson for the port of san francisco where she has truly and absolutely been able to communicate the port's mission

to manage the waterfront as the gateway to a world-class city, and advance environmentally and financially sustainable maritime recreational and economic opportunities to serve the city, the bay area and the state of california, renee has survived numerous commissions, numerous directors of the port, and has single-handedly played an enormous role in reaching out to communities, bringing communities to the porch from all over the city, and consistently doing it with love, and respect, and a laugh, among her long list of accomplishments , was in my district, coordinating the hundred 50th anniversary of the port of san francisco, which went off without a hitch. she has friends in every part of the media establishment, big, small and medium, but most importantly, she has managed to

make all of the misery that i personally have brought to the port looked good weather it was my lawsuit over the america's cup, or other litigation that ensued over eight washington, renee always but the best spin on it. never held it against me personally. i want to thank you for that. she was born and raised in the city and county of san francisco , has been a tireless champion for equity and diversity and staff hiring at the port, and contract awards, to ensure that the port is really reflecting the diversity of the city and the county of san francisco. with that i want to reiterate my thanks for two decades of services to the city and county and present you on behalf of the board with this certificate of honour and these flowers. thank you, renee. the floor is yours. [applause] >> thank you very much. this is more than i ever expected or dreamed of.

president he -- yee, honourable supervisors, and all of my friends and colleagues here at the city and county of san francisco, i want to thank you so much for this prestigious honour and recognition. it has been my pleasure to serve as a public service for the city and county of san francisco and in the porch in particular for the last 21 years. i just cherish the work that i've been able to participate in over time. i thank you all for this rustic dutch recognition from the bottom of my heart, and i am retiring, but you shall see my face from time to time at city hall, and especially along the waterfront. i just want to thank all of you for recognizing me and thank you again. [applause]

>> okay. with that that ends our commendations. thank you very much. madam clerk, before we go back into our other business, i would like to take the opportunity, which i haven't done, i wanted to make sure that supervisor walton was able to get back here i want to formally welcome them to our complete meeting, that they are attending, welcome

supervisor mark, supervisor walton, and supervisor haney to our chambers. [applause] >> can we make -- can we take item 45 class. >> item 45 is an ordinance to amend the planning code to require additional findings for home s.f. project authorizations to extend the application deadline for projects eligible for the home s.f. temporary provisions, and to amend the fee for affordable housing bonus program projects and to affirm the determination and to make the appropriate findings. >> i see that supervisor peskin, supervisor peskin class. >> thank you pig when this was in committee, there was also a request by this supervisor, but

also supported by the other members of that panel, supervisor tang and kim to insert a definition of development application, the legislation as it was introduced had no real definition of that so i wanted to thank the deputy city attorney, and i will read this into the record. you created a definition of development application in section 102 of the planning code , which reads as follows, develop meant application shall mean any application for a building permit, site permit conditional use in large project authorization. authorization pursuant to planning code sections 305.1 and 322 for any other authorization of the development project required to be approved by the zoning administrator or planning commission, and then the only other changes is that where it said developments application,

lowercase, is a defined term and has been changed to development application in uppercase, and i think that addresses the concerns of the committee. there was some discussion about, again, this is around the issue of what constitutes a complete development application, i understand from the department of city planning that they have 30 days once an application has been submitted to either review it and find it complete, or to issue a notice of incomplete application, and that is their administrative protocol, so want to put that on the record. i would like to offer that amendment to item number 45. >> okay. this amendment that's been offered, is there a motion and a second? >> seconded by supervisor mandelman. can we take the amendments without any objection?

motion passes. can we take this item as amended , same house same call? all right. without objection, this ordinance has amended and passed on the first reading. madam clerk, please call the next item. >> item 46 is an ordinance to amend the planning code to allow medical cannabis dispensaries with approvals from the planning department for medical cannabis dispensary use as of january fifth, 2018 to affirm the determination and to make the appropriate findings. >> supervisor mar? >> thank you. i think most of you know, and district four, there are many constituents of mine who have concerns about the process for cannabis dispensaries. it has been quite a hot button issue in my neighbourhood, so i just wanted to ask if you can clarify the questions for director elliot. >> okay, go ahead.

>> first of all, this legislation only impacts m.c.d. his that are already approved and does not increase the number of applicants or potential new dispensaries, correct? >> director elliot? >> thank you. nicole elliott, director of the san francisco office of cannabis it is great to see you all here today. supervisor mark, to your question, that does not increase any new business applicants for cannabis retail uses in the city all of these operators that are contemplated in this legislation were previously in the pipeline prior to the passage of article 16. >> supervisor mark, do you have a follow-up question? >> i have a question about the outreach process pics of this legislation would still leave in place the outreach process required of all dispensaries about adult use permitting, neighbours will still be notified and that does not guarantee approval for any of the current -- permits. >> correct.

>> i have one final question. what about temporary approval for adult use? i understand that is not necessarily in the legislation, but that might be something that the dispensaries that are covered by the legislation could pursue. what outreach process is there for those dispensaries that are through this legislation and would be to apply for adult use? >> for existing medical cannabis dispensaries that have article 33 permit from the department of public health, if they were to seek out you sales, they would be enabled to do so under the provision of section 3322 of the health code, if an m.c.d. does not have a final article 33 permit, than they would have to go through the cannabis and receive their article permit.

does not make sense? >> sort of. thank you so much. i look forward to working closely with your office as cannabis dispensaries and the cannabis industry continue to evolve in the city. >> likewise. >> seeing no other supervisor on the roster, can we take this same item, same call? without objection, the ordinances passed on the first reading. next item, please. >> item 47 is a resolution to receive and approve the biannual housing balance report number 6, dated may 10th, 2018, and report number 7, dated september 20th, 2018. >> supervisor fewer class. >> thank you. i just wanted to make some comments. voters passed prop k. in 2014, setting a goal 33% affordable housing below and -- low and moderate income san franciscans. according to that the report,

less than 18% of net new units built in san francisco in the last ten years have been affordable. for every two new affordable units the city builds, at get lost one rent-controlled unit two evictions, demolitions, and condominium conversions. while it is very important for us to continue to build more affordable housing, it is just as important that we preserve our existing rent-controlled housing so that we are not taking two steps forward and one step back. this state approves why it is so critical that we as a city invest more in housing acquisition programs to preserve rent-controlled housing and prevent the loss of rent-controlled units and displacement of vulnerable tenants. thank you. >> supervisor mar? >> thank you, i actually had follow-up questions more specific to district for --

district four. i first wanted to make a few points, as a new supervisor for district four, in the first time i'm able to review the city's annual housing balance report, i think this is critical information for us to understand what type of housing we are developing here in the city, and ensuring that affordable housing is prioritized, and just looking at the report, if you -- a lot of the figures really leaped out at me, particularly the fact that district four, not surprisingly, is by far the worst of all the districts when it comes to the cumulative housing balance figure. there is a negative 277% figure for district four which is about four times worse than any other district. and also the fact that i am working at table one, the main

chart and report for new affordable housing units built over the last ten years. i see the zero in district four. we are the only district with no net new affordable housing units built over the last ten years. and then also filling up just following up on supervisor fewer 's comment on the call of units removed from protected status, that's really rent-controlled units that have been lost for district four. they lost 462 units over the ten year period, which is one of the highest in the city. i think, i wanted to say these figures are alarming to me as a new supervisor for district four , i'm very committed to addressing the housing and balance in my district, and particularly on the west side, and ensuring that our affordable housing strategies in the city include all of the neighbourhoods in the city, it all the neighbourhoods are doing their fair share to expand

housing for families, seniors, and everyone who is priced out of the market. i had a general question for planning department, who worked on this great report. i was just wondering if you could explain the cumulative housing balance figure. it's a little bit beyond me, but the negative 277% figure that my district received in the report. >> yes. the housing balance calculation actually has been mandated wherein we are looking at the new affordable housing units built, the acquisition and three have -- rehab, which are also considered affordable, and we deduct - the units that we move from protected status, and we

end up with -- and then add to the entitled affordable units that have been permitted, which we didn't like. this is now seen as a proportion of the total net new units built , and also the entitled units. there is a calculation is included in the ordinance, and when we do our presentation before the board board, we actually show the calculation. i believe i have it here. so this shows the calculation of the housing balance, and with

the numbers this is the cumulative housing balance for the port number 7, and this is for the whole city, and using the same calculation, this is how we came up with the negative 270% for district four. the report also shows that the housing balance varies by district. this is a calculation that was mandated by the ordinance. >> okay. supervisor mar? >> thank you. >> thank you. >> supervisor mandelman? >> thank you. i guess i have a question, which

is also being whispered to me by supervisor fewer for planning is well around the inclusion of the r.a.d. units as net affordable housing stock. because isn't that -- aren't those existing units that are being rehabilitated? >> yes, these are existing units that would have been lost because they needed to be rehabilitated for habitability, otherwise it would have been -- >> it sounds a little bit like we are counting units not lost as new units or the equivalent of new units. >> supervisor mandelman, when you speak, speak into the mic. >> i was just saying by including the r.a.d. -- and maybe i am not understanding this chart, but including the r.a.d. units as part of the numerator, a makes it sound like

those are new units, when i don't think they are. >> they may not be new units, but we have been -- part of the calculation was mandated, it was negotiated as to what should we be considering to be the affordable units that are maintained. >> okay, thank you. if i could just make a few quick comments, i want to echo all of supervisor fewer and mar's comments around the feeling that we are racing to almost lose ground, that if we are losing half of the units that we are producing, we are in much worse shape.

i'm keenly aware i represent district eight, and congratulations supervisor ronan in district nine for narrowly edging us out in the record for lost units, but it's truly disconcerting to be losing the number of rent-controlled units at both of our districts and the city has, and to not even -- and to be losing so many of the new units, essentially just replace the units that are being lost. i checked on the arena and the fair share requirements that san francisco is supposed to be producing, and i believe we are supposed to be producing something like 50 6% of our new construction that should be adding to our housing stock, to our affordable housing stock, but here we are seeing that we are only at 18% and so i think we are on the planning side, we

are doing extraordinarily good work to try and find more space for all kinds of housing in the city and to zone and plan in ways that allow us to increase units overall, but we really need to focus on providing substantial additional resources to increase the number of affordable units that are getting created, not just to keep up with the notebook -- obligations, but not fall further behind as we lose these units to speculation. thank you. >> supervisor brown? >> thank you, president he -- yee. i agree with supervisor mar and fewer. i think that we really do need to look everywhere in the city and all districts need affordable housing, and i really feel that we need to go out into our district and talk to the

community, to have them accept 100% affordable housing coming into the neighbourhoods. i think that is so important. but one of the things that i am dealing with, and i know a lot of us are dealing with, and supervisor fewer mentioned, is losing our affordable housing stock as it is right now. i am dealing with three buildings right now that are being taken out. we have seniors, people of colour, retired people, who are living in these buildings, and trying to manoeuvre her to see if we can actually buy them, and it is so difficult because of the speculators, but when you look at it takes almost -- it is about $900,000 to build a brand-new unit in the city of affordable housing, entered by a

unit, it can be between $40,450,000 -- $40,450 to buy an existing unit. we need to really look at being much more creative, and putting more money into buying buildings that are coming up, especially when we have rent control, if there's seniors in these buildings, and low income people , it is so much harder to find someone housing, than to keep them housed. so i would love to see us really put a lot more money into our small sights program, i just think it is so important, and also build affordable, but we have to start manoeuvring in a different way because we are seeing people lose their housing , and then there is no other place for them to go because these people are usually on fixed incomes, they are in rent control, and they are

pushed out of the city. so i really hope that we start really looking at affordable housing and purchasing affordable housing and that pushing the dollars towards small site programs, and any nonprofits that are managing this program, we need to actually funds them more so they have higher capacity to go out and compete with the speculators anyway, i just wanted to put my comments and in. thank you. >> supervisor walton? >> i wanted to talk about affordable housing imbalances that we have here in this city. just to echo some of the sentiments of my colleagues. we have districts who are building a good amount of affordable housing and focusing on increased vicinity, but we need to make sure this is a city wide focus this is a citywide issue.

and a regional issue of affordability. i wanted to make sure we are all working towards the same goals and increasing affordability across san francisco, because it is very important. right now i know we are pushing developers hard in district ten to increase affordability and be real innovative and creative about how they do that. i've been in several conversations with developers and have requested from them that they come back from -- to the table and tell us how they can get their percentages up, and i think we all need to be pushing developers and anyone who is building in the city to do that. small site acquisition program is a great opportunity for the nonprofit developers to be able to purchase housing so they can make it more affordable for communities, but the resources that we have in the city, the way we finance affordable housing right now, there's not enough money to go around for small site acquisitions and really be as effective as we wanted it to be, it has been working the program, the program

does work, but there are more resources we have to go after to make that happen. in just the last thing that i will say is that as we look at the current pipeline of affordable housing, and we know the areas of the city where most of the affordable housing is being built, is going to be built and is on the pipeline, i hope we are all working hard to make sure that we do our fair share to identify larger opportunities and more affordable housing in san francisco, because it is a citywide problem and a citywide issue. >> supervisor fewer? >> thank you. i wanted to mention and piggyback onto the discussion again. it is that in my district, of course, i may negative 70-point 9%, and then also i have had 527 units removed from protected status. i just want to say that when we depend on developers to build our affordable housing, we will see a greater imbalance and we continually will be imbalanced.

when 70% of what we built is not affordable, than it is trying to -- trying for the city to build affordable housing. we cannot depend on developers to build affordable housing. we will be even more in balance and the imbalance will grow greater and greater. as we see our protected status, meeting our rent-controlled buildings, actually that stock diminishing, and without our ability to actually expand the stock of rent-controlled, i think that we are in a really bad place here, and i just want to mention this housing and balance shouldn't be so informal people should take this very, very seriously. this is what the voters passed in 2014. when we depend on private developers to build our affordable housing, we are in trouble, san francisco. and i think we should be investing much more in affordable, 100% affordable housing independent of private developers who are trying to

make a profit on this, and also the small site acquisitions on our neighbourhoods, on the west side, this is where we can save our stock, and more money should be put into that. thank you. >> supervisor ronan? >> i just want to continue off supervisor fewer's comments that i completely agree with, and mention that the other day, i don't know, maybe it was a few weeks ago, there was a front-page article in the san francisco chronicle about how there wasn't many new projects in the development pipeline because developers were no longer investing and developing san francisco because rents were not continuing to rise, and home prices were not continuing to rise, and i really think that that's an important point to, because goes completely against the line that if you just build

more and more housing, then costs will come down. developers are not going to build more housing unless prices or rentals and purchase continue to go up, and that's the fundamental flaw in their reasoning, and it's why it's so important for the city and county of san francisco to build affordable housing ourselves. is the only way we will ever catch up to this housing and balance. that's number 1. the other point i wanted to make is that district nine came out on top in two areas, as supervisor mandelman mentioned, we had one more rental units previously rent-controlled unit taking off the market then supervisor ate in the tune of over 400 units. it's a shame that so much money was spent on proposition ten on the ballot.

that is what we need. in order to have local controls, we need to repeal costa hawkins so we can create the type of local controls to preserve that number 1 source of rent-controlled, price stabilized housing in the city. is so important. we have to continue this effort, but then also district nine came out on top on the number of permitted affordable units in district nine in the year 2018, and i also want to point out that that neighbourhood advocacy on the part of mission activists that fights so hard for every single affordable unit that we can gain and say we welcome market rate units as long as they bring a fair amount of affordable into the neighbourhood, and that more balanced approach to market rate

development that we see in the mission because of that community activism and engagement is so important. so there is a lot of work to do in this arena. i think we need to really take a deep dive and question some of the assumptions and the talking points of certain advocacy groups about how to lower prices in san francisco. something we desperately need to do. i think where we all agree is that we need more revenue from state, we need more revenue from the feds, going to localities to build the affordable housing that we truly need to. it is the only way that we look at the balance that we all desperately want. >> okay. supervisor haney? >> there it is. i'm just figuring out how to work the mics.

i appreciate how supervisor fewer started us off, which is we have prop k., we have goals that the voters have set for us, and i think that we have to get to a point where we are not just reading these reports when they come out on a regular basis, but actually figuring out how we will change course here, in one of the things i'm very excited to hear is that there's a lot of support across this board and across the city to build more housing everywhere, and so i think that's a huge opportunity that we have to work together or boldly to make sure we are doing that and speaking of coming out on top, one thing that obviously , that i see when i look at this report is how lopsided it is in favour of district six and also district ten building a lot of the new housing in our city. it also goes for building most of the affordable housing.

if we can figure out how we can build more housing, especially affordable housing throughout the city, i think that's a huge opportunity that we have, whether that's looking at opportunities with zoning, but especially looking at opportunities for investing as a city, because i think if we are relying so many people have said on just the market rate developers to come in and make these decisions, were not going to get to the goals that we have so how are we making these big investments ourselves while i also agree that is much as we are focused on building new housing, and i know the mayor has hired somebody who is focusing on housing delivery, we also have to be equally focused on protection and looking at the units that we are losing, and also see that we need to look at the balance. his so are we building very low, low, moderate, and middle, as we think about the larger question of affordable housing, certainly

i want to see us build a lot more affordable housing in district six, we will continue to do that. even though these numbers are high and relative, they are not high enough, but i think if we can get to a point where we are also working together to build throughout the city, we will get closer, i hope to meeting our goals, which should be more than just goals on paper, they should begin to be goals in action and goals in reality. >> supervisor peskin law ? >> thank you. i want to thank our predecessors for putting prop k. on the ballot and for allowing a housing balance report to be created. it was controversial at the time i'm never an enemy of more information, because it spurs conversations like this that otherwise might not have, and i think that there were -- there have been other proposals, and we might want to start examining them or similar things whether

it was prop g., the anti- speculation tax, i met with mr just and true last evening, and part of the reason that we have new -- due process inland use is that neighbours and activists can come when that speculator has a terrible project, and if there are ways that we can actually not allow repeat offenders to be able to reapply for the fifth project where they are evicting people, and we know that they are serial offenders, and they violate the policies of this board back and i think this administration all claim to support, that we tell them that you know, it will take three years to process your permit or sue us, or what have you. by the way, there was also conversations which may or lee in the development community was not very excited about about metering.

and when we reach housing and balance, that is a time where you don't issue permits as of right, you subject them to conditional use, and we should have that conversation again. i'm delighted that all of my colleagues and the new colleagues on the board are invested in this issue. it is music to my heart. >> thank you. okay. i appreciate all the comments that were made by the supervisors here on this item, and i think what i am hearing is we are challenging each other to come up with policies that can actually support the end goal here and for all of us to look into our own districts to see if there are any available developments that can put us closer to our goals. certainly, for me in district seven, i have been working on a project that hopefully will get 50% of these units, out of 1,000 , hopefully about 500 will

be affordable, and we are looking at another project of 250-300 units that really are pushing to have that 100% affordable in my district. hopefully all of you will be doing the same thing, and the challenge is on. i expect that many of you will work on policies that will support this effort, and when you bring it to me, i will certainly be supportive of it. thank you. so i think we are supposed to vote on something. can we take this same house, same call? without objection, this resolution is adopted. madam clerk, please call the next item, which will bring us to the special order. >> yes, items 48 and 49 comprise a special order at 3:00 pm for the board of supervisors to convene a committee of the whole for a public hearing scheduled

pursuant to a resolution adopted on october 23rd, 2018 which is item 48, which is the public hearing to consider sitter item 49 and ordinance to consider or drink the vacation of streets and an easement in the sunnydale , hope s.f. project site to confirm the determination and make the appropriate findings. >> okay, thank you. does the district ten supervisor wish to make remarks? supervisor walton,. >> thank you. as we know, my predecessor, president cohen, introduced resolution and ordinance to this body on september 4th, 2018 and support and furtherance of the sunnydale hope s.f. project and the construction of highly needed public housing replacement units. i am not a sponsor of these pieces of legislation and i am requesting a continuance of the committee of the whole hearing

until january 29th, 2019. there are a few amendments that we are working on and my office incorporates language from s.f. p.u.c. resolution that is scheduled to be heard and passed by the s.f. p.u.c. commission on january 17th, and additionally , it is my desire to meet and convene with community and have some conversations with the developer and city agencies to understand the state of the development of this project, particularly to the street vacation and specifically i would like to make sure that these conversations have happens i would like to move these and motioned that 48 and 49 b. continue to our next meeting on january 29th. >> before we take this motion, i would like to invite -- because you are asking for this agent to be continued and will now take public comments on the continuance. are there any public comments? come on up.

>> i would never pass an opportunity to come speak before this great city by the bay, particularly these fresh faces to come along with these other good faces. i am tickled, not tickled pink, that tickled black. i do believe the city and county will move forward in a way that have never been in a number of years. i can say that because i have been around here longer than all of you, but this is so refreshing, and i will be able to speak a little bit more about that, and i'll be back to speak on that about hope s.f. because yours truly was there in the invention of hope s.f., because hope s.f. came without migration let me say this, first of all, i would be able to speak on all of you and how good you all look. but speaking on hope s.f., if you rewind the tapes on the cases, we go back to when our

current governor, newsom was involved. yours truly, ace washington. i videotaped newson writing at potrero hill. they looked like a rock star. i am bringing back all that history, and i am just saying inadvertently that yours truly, ace is on the case. there is a new sensation here in the city. particularly with hope s.f. rad. and all of those unforgotten black folks that are in these r.a.d. apartments. yours truly, ace is on the case, and making sure this particular race its going to be in the next ten years. my name is ace and i am on the case right here in the city by the bay. i'm so happy.

>> any other public comments on this item? seeing none, public comment is now closed. supervisor walton. >> briefly, i forgot to mention that the project sponsor and city staff are here to answer any questions if there were any on this item. >> there were no questions. so supervisor walton made a motion to continue this item to january 29th, 2019. is there a second? seconded by supervisor ronan. motion to continue this item to january 29th, made by supervisor walton and seconded by supervisor ronan, without objection, item 48 and 49 a continued to january 29th 2019 madam clerk, can you please call the next item? >> item 50, the board of supervisors will convene a committee of the whole for a

public hearing on the san francisco public utilities commission, clean power s.f. community aggregation program, electric generation rates and charges, submitted by the p.u.c. on december 23rd, 2018. >> okay, thank you. i believe we have representatives from the p.u.c. who are here to share. >> mr president, if i may just speak. >> supervisor peskin? >> thank you. colleagues, i want to put this in a little bit of context. the public utilities commission actually introduce this before the winter break, and given the time periods under the charger, we would not have had the opportunity to hear it and the rate would have gone into effect i want to thank the p.u.c. for withdrawing the rate increase in

reintroducing it so that anyone member of the board could ask for today's hearing. the reason i ask for today's hearing, and i want to be clear from the start that i do not propose the rate, but have very serious concerns and wanted to hear from the p.u.c. about how pg and he, to my mind without proper cause, has assessed these exit fees, gotten them approved by the california p.u.c. and i want to hear about the impacts when i asked for this hearing, i had no idea that yesterday pacific gas & electric would take their first steps to filing the second bankruptcy action in the last 20 years i had the pleasure of being on this board 21 -- two times when pg and e. filed for bankruptcy.

but it does implicate clean power s.f., and i wanted to give with these recent developments the p.u.c. the opportunity to address those issues, and with that, president yi, i would defer to the p.u.c. i note that the general manager is here and head of the power enterprise, ms. miss barbara hale is in attendance. >> okay. would you like to come up and present? >> yes, thank you. i am the assistant general manager for power at the s.f. p.u.c. is a number of new members here. i am looking for your support for a rate action today, but i wanted to take a little bit of time to provide context for that , background information about the services that we provide as san francisco public owned utility. we have been providing power here in san francisco now for nearly 100 years.

we are the publicly owned electric utility in san francisco and we provide clean energy for city services and property, streetlights, redevelopment sites, and new development projects. s.f. hope that was just talked about, sunnydale, one of the projects we have been providing service to for many years. the shipyard redevelopment project, another example of that , examples of the kinds of facilities we serve, city hall right here is served by our power program. san francisco international airport, all the schools, public schools, libraries, police and fire stations, all the court city and county services that san franciscans rely on received their clean hydro and other renewable product energy from the p.u.c. we also serve, since 2016, customers through the second

power program. the clean power s.f. program. is a community choice aggregation program. we operate two programs. both of which rely on pg and e. for distribution services, getting the power to the customers and to this end users. this first a graphic that you see here shows on the top numbes delivered, utilizing our generation, our transmission facilities, transmission facilities transmission facilities that are owned and operated by the california independent system operator, and then distribution through pg and e.'s system, and our own local assets, getting the power to our customer. than on the second row here, the clean power s.f. line, you see how our community choice

aggregation program receives service, and to the c.c.a. model as required by state law, the city takes responsibility just for sourcing the electricity. we have chosen clean and reliable sources of generations. when this clean power is produced, it is delivered onto the high-voltage system, operated by the california independent system operator, and then it is distributed locally by pg and e. to our end-use customers. the community choice aggregation program is a partnership program the local jurisdiction, that assess, san francisco, partners with a the local investor-owned utility, pge -- --dash pg andy isn't responsible for ensuring the low local system and performing the metering, billing services for our clean power s.f. program. with that, is a little bit of a background, i will dive more deeply into the clean power s.f. program.

under the community choice program, local governments purchase electricity on behalf of their community members. the whole opportunity for community choice aggregation was authorized by a california assembly bill 117 in 20 -- 2002, authored by an assembly person. it is a homegrown idea that has gone statewide. the local jurisdictions become the default electric supplier in their communities, the local investor-owned utility, and our case, pg andy continues at distribution function in response to outages, metres, and bills the customers. by state statute, the program, the c.c.a. programs, clean power s.f. program is an opt out program. when we are enrolling customers into the program, we provide two notices under state law describing the terms and conditions of the program to our electricity customers over a 60 day period prior to actual enrolment, and then two more

notices after they've been enrolled. the state law authorizing c.c.a. also requires a california p.u.c. to ensure that no unavoidable costs that were encouraged by pg nd to serve customers of a c.c.a. program will be shifted to nonparticipating customers. this is a policy that we support that no one should be harmed in the ability of a jurisdiction to pull customers into their program. the p.u.c. has developed and implemented a california -- the california p.u.c. has developed and implemented an exit fee that appears on customer monthly bills on an ongoing basis to recover these costs for pg and e. that exit fee will appear on c.c.a. customer bills until the commitments that they made to serve those customers have been terminated or completed. that means that the exit fee

could appear on a customer's bill for 30 or more years into the future. it is kind of an odd framing to call it an exit fee. people think it is a one-time fee when you do that but it is actually ongoing. the p.u.c., the san francisco p.u.c. developed and launched our clean power s.f. program guided by some specific program goals. that's were developed over time with the input of the mayor, the board of supervisors, and our own commission. these programs lead with affordability, making sure that rates are competitive and that services are reliable to provide cleaner electricity alternatives that deliver more renewable energy and de- carbonized the city's energy supply by 2030 and invest in the city's electric supply. those revenues are coming in locally to new renewable and demand-side projects.

such as measures to reduce energy use of homes and businesses that create new clean energy jobs within san francisco and the bay area, and then finally we need to balance those goals and ensure we are providing long-term rate and financial stability for the program. in balancing these goals, we are leading with affordability. our default product, evergreen product described here is priced competitively with standard offering, and it is cleaner with at least 40% renewable energy. it is a better product for a comparable price, and we also have a premium product, our super green product. customers prioritizing that renewable project can choose to pay a slight premium for our 100% renewable energy project. it cost the average residential customer in san francisco about four dollars more per month with their electric service than the green product. clean power s.f. is a choice

program so customers can also opt out of the program and take their electricity supply away. we begin serving customers under the clean power s.f. program in may of 2016 when we enrolled commercial customers and supervisory districts five and eight, and commercial and residential customers throughout the city that have signed up. it will be approximately 800 accounts in all. we have enrolled about 117,000 accounts citywide, were almost 30% of the potential clean power s.f. accounts in the city. the p.u.c. has been busy for his next major enrolment and they will be enrolling about 280,000 mostly residential accounts in april. with this enrolment, we will have enrolled all but the largest electricity accounts in the city and we will be following up with those electricity customers

individually over the course of calendar year 2019. after the upcoming april enrolment, we estimate the number of active customers being served by clean power s.f. that will be around 365,000. as part of our phasing policy and decision-making around 12 enrolled additional customers, the p.u.c. established it would not automatically enrolled customers unless we projected that our rates would be at or below pg&e at the time of enrolment after accounting for pg&e's exit fees. that brings us to the topic of today's hearing. clean power s.f. rates, and pg nd exit fees. the exit fee is a method this cpuc uses to ensure those unavoidable costs are shared with c.c.a. customers. the p.u.c. took a rate action. the san francisco p.u.c. took a rate action that is before you today because it pg nd was forecasting that it's rates

would be changing early this year, specifically, their exit fees are expected to increase for commercial customers, and decrease for commercial customers. the generation rates are projected for all customers. the results, were we to take no action is that clean power s.f. customer cost would be higher than pg nd service. that is why we are here with you today recommending that you take the action to ensure that our customers have competitive rates with pg nd and are protected from these exit fees that they implemented. influencing these changes is the decision of the california p.u.c., which change the methodology for calculating fees in october of 2018. the most recent decision was recent -- was really front of mind for san francisco and many

other communities that operate or are planning to operate c.c.a. this past fall, a some of you may recall, in september, all members of the san francisco board of supervisors signed onto a letter that was prepared by the c.c.a. association requesting that the california p.u.c. adopt a balanced decision on the new exit fee methodology. >> i'm sorry to break in, there are supervisors who wanted to ask a question. supervisor ronan and supervisor peskin, and his supervisor walton wouldn't mind, i want you to ask a question first pick i know you are first on the roster of supervisor peskin. are you okay with that supervisor walton? >> yes. >> thank you so much. i just had a question through the chair, miss hale, i don't know if i fully understand this. if there exit fee is expected to

decrease for residential customers, why with the rates for all customers be going up, not just for commercial customers? >> it is really to the methods that they are choosing to assign costs for the ones that they are incurring. and the action that the california p.u.c. is taking us what we are reacting to in making our proposal to you. >> i see. even though this is a first time that i've realized that the cost of the exit fee for residential customers is going down, as is the generation rate, and yet because the exit fee is going up for commercial customers, and their cost-sharing methods, they are increasing rates for residential customers as well? >> yes. i thank you get the gist. is a number of components that are moving, and is different

--dash it is different for the different rate classes. >> this is a whole way that residential customers are being punished by pg andy. >> i believe general manager kelly might have an answer to the first question. okay. the exit fee only applies to the folks who left, so that will increase, and that means we have to absorb it, or if it decreases , it is a good thing, however the generation cost goes down, and so we have to make sure that hours go down as well, our price so we can absorb the exit fee. so i think the main theme is the fee only applies to us, and so although it is higher may go

down, we still have to absorb that fee. that is why we've been fighting to make sure that fee is not higher because we have to absorb that cost. it doesn't apply to pg and e., the exit fee. >> at the end of the day, customers pay bills, they don't pay the individual fees, they are just looking at the bottom line. we are trying to make sure as we do our rate making analysis and recommendations to you and to our commission, we take that into account, and look at the bill results of these changes. >> okay. do you have more to your presentation? >> thank you. >> please continue. >> as you are understanding, these are controversial decisions of the california p.u.c. is making. the board participated in outreach with the letter that i referenced. the mayors of san francisco,,

oakland and san jose also jointly submitted a letter to the california p.u.c., despite our request for change to the new exit fee methodology, they voted out the decision unanimously. that brings us to where we are today. the rate action was taken in december by our commission to improve the prospects for our customers to see competitive reliable service. it was designed to ensure that the clean power s.f. program would be able to continue offering that affordable service to both existing, and future customers that who were planning to enrolled in april. [please stand by]