environmental proclivities and goals around climate change and it's so easy that it's hard to not want to do it, and it doesn't really add anything to the bill. >> good afternoon. i would like to call to order the regular meeting of the san francisco public utilities commission. the date is tuesday, may 28th, 2019. roll call, please. [roll call] we have a quorum.

>> i would like to make an announcement before we proceed. the first session will do close sessional be called out of order today and it will be heard after item number 4. after item number 4, we will go into closed session and then reconvene. next item, please. >> item three his approval of the minutes of may 14th, 2019. >> commissioners, before you you see the minutes of may 14th and the addict -- additions or corrections. >> none, i move to approval. >> second. >> any public comment on the minutes of may 14th? all those in favor? >> aye. >> opposed? the motion carries. next item, please. >> item four is general public comment. members of the public may address the commission on matters within the commission's jurisdiction and are not on the agenda today.

mr. -- where are you? there you are. >> commissioners, today i want to talk about career jobs. whenever we come over here, and presentations are made, you have to be very careful that those presentations are focused. not to long ago, we had some presentations about the water system improvement projects, the tail end of that. but we began by saying the sewer system improvement project -- i want to make it very clear. no other district or city where they have a task force on a huge project like the sewer system improvement project, that

started out at $6 billion, and now it is $12 billion, and you had a task force that made some very stellar recommendations. as soon a task force had done the job, they got a commendation , and that was the end of the story. now we have the community benefit, some $600 million, and we have two people kind of in charge of that money, and one of them, he claims that he is a gatekeeper. the other one claims that she is the chief strategy officer, that is added to her title that she has within the san francisco public utilities commission. commissioners, i am asking you,

the money spent, the community benefits in the southeast sector , there are infants, our children, our youth, our young adults, our elders, those with compromised health, and more are mentally and physically challenged. they are suffering, and many of them are slowly dying, and here we have people getting $300,000 grants to open restaurants, and million-dollar awards for art. where is our focus? is there any empathy and compassion when you look at this , anyway we look at this? in no other place with they have allowed the task force to suggest something like community benefit, and then, you know, somebody else takes control and wastes the money. and you commissioners, and two

of them are missing in action, you commissioners should do something about that. i am forced to be very strong with my blogs, but now it is time for the act to be implemented. thank you very much. >> thank you. and clark. -- ann clark. >> hello, i'm a city college graduate. i will talk very fast. i also left you with a somewhat blue paper in your seat, thank you. we need the sfpuc to help with suggestions to revitalize the balboa reservoir. you have the experience, expertise, planning, building, and traffic experiences that are critical for city college and our students. one of our areas that is most needed, which was the start in 2003, was the performing arts centre. i am showing you now the 2006

plans for the performing arts centre, as well as the architectural and engineering services that were done in 2004. the building has never been built, but now we do have the balboa reserves, reservoirs, and we do have a place for the performing arts centre, and we must go forward. this is almost 20 years later that this building has never been built, so we urge you to think about that, to remember us , and to thank you for all the experience and expertise that you bring, you are a wonderful group, and i really appreciate all the work that you do. so thank you very much, and remember, and i remember, go to lunch at your beautiful s.f. p.c. -- sfpuc building. let's talk, or let's have a cup of coffee -- coffee, i love your building. you did a great job. thank you so much. >> thank you. what happened to our lunch date?

[laughter]. >> that's right. [laughter] >> unfortunately, i am one of those people whose knee is not working very well, but i will get you, because we can talk together, right? [laughter] >> the next speaker is harry bernstein. >> thank you. i am harry bernstein, i'm a rate payer and an instructor at city college san francisco. first i would like to endorse the sentiments of the previous speaker, but i would like to talk about not so much not only the performing arts centre, but also the balboa reservoir project. i realize you have the wsa for balboa reservoir on the agenda. so what is going on at the balboa reservoir project,

anywhere from 1100 to 1500 proposed units, that is basically the privatization of badly needed public land. there is only, i think 33% of that proposed property is set for affordable, and the rest is unaffordable market rate housing the other thing that has never come up from the staff or the presenters at the, meeting from the reservoir project, is the possibility of invoking the surplus land statute, which i believe is government 5422 to see in this case, which allows community groups and schools to be offered a chance to acquire k

what is declared surplus. one of the reasons that hasn't happened, is even though there has been millions of dollars already spent for this project, the land is not surplus to the needs of the water department. maybe that's the way things are done around here, but it seems like there's so much invested, it appears there is no consideration that there might be the use of this land by schools or community, but that's the law. i would like to get some greater clarity about this matter. thank you. >> could somebody meet up with mr. bernstein to explain that? i would appreciate that. any other public comment for this item?

seeing none, i will renounce the fact that we will go into closed session. council, excuse me, how long do you think the closed session will be? there is your answer. [laughter] >> very hard to predict. >> i was just trying for those people who like to come back, i was just trying to give them an idea. should we say half an hour, perhaps? >> that should be about right. >> okay. , don't hold us to that, but it is a good guideline. so, please read the items were closed session. >> item 22 is existing litigation for civic gas and electric corporation, and that is the only item. >> any public comment on the item to be discussed? >> seeing none, may i have a motion whether to assert? >> move to assert. >> second. >> all those in favor? >> aye.

>> opposed? the motion c >> we have now reconvened into open session. there is no announcement following closed session. may i have a motion regarding what was disclosed? >> not to disclose. >> second. >> all those in favor? >> aye. >> oh opposed. the motion carries. next item, please. >> item five is communications. >> any discretion on communications, commissioners? in a public comment on communications? next item, please. >> item six is report of the general manager. >> good afternoon, the first item is clean power s.f. update, rates and implementation update.

>> good afternoon, commissioners director of clean power s.f. for the power enterprise. for the update today, i will cover our usual clean power s.f. customer enrolment and service status update and i will be providing a report on clean power rates implementation. slides for the rates are included in the agenda packet first with respect to enrolment in service to customers, clean power s.f. service and the current enrolment effort continues to move along successfully. as you know, we completed our april enrolment. the p.u.c. has now enrolled more than 400,000 customer accounts in san francisco, hooray.

[laughter]. >> we are in the process of spending -- sending the final batch of enrolment notices to the customers we enrolled. in total, the p.u.c. will have sent more than 1 million enrolment notices to customers over the four months. it is a big number. i would like to recognize the fantastic work of our power communications team in successfully managing that effort. our program opt out percentage is now three-point 1% three-point 1% since the program lounged. that is another tenth of a% since the last meeting. we continue to have a 90 7% participation rate. and the clean power s.f. a super green right is up to 1.6% with about 5900 accounts electing to receive 100% renewable power from clean power s.f. now i will turn to the slides.

last month, during our regular c.c.a. update, the assistant general manager reported on pg and e. 2019 rate proposal, which was supported on -- submitted on april 18th to the california p.u.c. that proposal says that the california p.u.c. approved in june it's rate for implementation in july. miss hale mentioned we were analysing the impact of that proposal on customers and we would come back in may providing an update of implantation of what they took in december. i have a report today on how we are envisioning this. i wanted to remind everyone what has happened over the past few months. then i will summarize that we are proposing to implement the financial impact and what the schedule is looking like.

given that we have a couple new members of the commission, we thought it would be appropriate to review a few key terms of come up in our clean power s.f. rate making exercises. first, the generation rate is the rate that recovers the cost of producing electricity. clean power s.f. rates compete with p.d. and degeneration rates after accounting for the exit fees that pg and he charges customers that participate in clean power s.f. the most prominent of those exit fees is the power charge and difference adjustment. you will hear that a lot. the p. c.i.a. this the ongoing exit fee that clean power s.f. must pay on their monthly billso cover the above market cost of the energy resources pg and e.e. procured e. procured to serve them before it became -- they became clean power s.f.

customers. the other exit -- exit fee is the surcharge. surcharge recovers a portion of the franchise fees that pg and he must collect from customers that purchase their electricity from a c.c.a. program. it is a very small component of the clean power s.f. rate formula that the commission has used over the past few years. we have included a summary of how these elements are accounted for in our clean power s.f. rate formula in exhibit b of the deck , on slide number 27, if you want to look at that. late last year, as we were preparing for our april enrolment, p.d. and he was forecasting his generation rate would decrease by 6-9% across customer classes in 2,018. they were also forecasting an increase in the p. c.i.a. -- in the -- you can see a summary of

these changes at the very end of the report in exhibit c. to avoid enrolling customers into a more expensive servicing april, and to satisfy the commission's adopted phasing policy for clean power s.f., staff proposed to reduce clean power s.f. generation rates, and apply credit in the rate formula to offset rate increases if applicable for certain customer classes. we also propose no changes to the super green rate premiums, which we forecasted would stay competitive with p.d. and e. and are offering. due to uncertainty around when p.g. & e's rates would go into effect, the exact amount of the change -- the commission offers a general manager to finalize

clean power s.f. rates ones p.g. & e's 2019 final rates were known, and to delay implementation of clean power s.f. rates if p.g. & e's mentation was delayed. on january 15th, the board of supervisors held a hearing on the clean power s.f. rates were the board expressed support for the action. as we have been reporting regularly to the commission, delays by the california p.u.c. and issuing a decision on the rates has delayed the implementation of the proposed right for 2019. typically, they will implement their new rates on january 1st of each year, but a two-month delay by the california p.u.c. in issuing his decision has pushed that schedule back. in march, we reported that snc-lavalin decided -- p.g. & e decided to split its 2019 rate changes into two actions. increasing the generation rates in march by one point for%.

that rate change in march resulted in greater savings for? power s.f. customers relative to p.g. & e service. then in april, p.g. & e filed the other part of his 2019 rate plan, requesting further increases in his generation rate for all customer classes. p.g. & e also requested a decrease in the pcia for residential customers, and increases in the pcia for commercial customers. again, the percentage changes are at the back of the deck if you want to see how things move against the initial forecasting december. in short, while we were expecting, late last year, that the rate would decrease in 2019, p.g. & e is now requesting generation rate increases. now that we have a better idea of what p.g. & e's generation rates and the pcia will be for

clean power s.f. customers, we are preparing to implement the rate action from december 11th consistent with that rate action and the rate setting policies, our proposal will recover program costs, it will realign rates to have a consistent margin of savings within each rate class relative to p.g. & e, it will deliver savings to customers compared to what they would have paid, and it would support the funding of financial reserves for the long-term financial health of the program. with those goals in mind, our right -- our rate of limitation would adjust the green power s.f. project rate to align them with p.g. & e's rates, to ensure a consistent margin of savings. it will help our communication of our rate plan to our customers. we would set the pcia credit

adopted in the december 11th rate action to zero, this would allow us to utilize the pcia credit in the future if needed, but given the rate changes we are seeing, we do not believe it is needed at this time. and specifically, we are proposing for residential customers with a rate adjustment with green rates to achieve a 5% cost savings on generation and generation service, as well as a reduction in the super green premium from 1.5 cents to 1.07 cents per kilowatt hour. for small and medium commercial customers, we would adjust rates to achieve a three by five -- three by 5% savings. we are not proposing any changes to the super green. given the change to green, they will continue to stay competitive. finally, for large commercial industrial customers, we are proposing to adjust rates to maintain a 2% savings on generation service, and reduce the super green premium for

these customers from one to three quarter of assent a cent four k wh to remain competitive. so what does that look like from a cost comparison? this slide summarizes the resulting monthly cost comparison for p.g. & e's default product offering, and clean power s.f.'s green service for an average residential customer in san francisco, before and after our proposed rate changes. the first two bars on the left side show the cost comparison before a proposed rate info mentation with full p.g. & e service costing the average residential customer in san francisco $62.70 per month, and clean power s.f. green service costing 59 cents less at $62.11 cents per month. that is before the rate change. the two bars on the right show the cost comparison after the proposed rate changes.

here, the average residential customer is paying $65.94 per month with p.g. & e service, clean power s.f. green service would cost a dollar 63 per month less at $64.31 per month. while the overall cost is going out for residential customers, the proposal offers greater savings relative to p.g. & e then currently provided, and ever provided by the program through a rate action today. you can see full electric cost comparisons like this for small, medium, and large commercial customers in exhibit a of the report, and in exhibit b, you can look at the comparison between the green and the super green generation cost after the proposed rate change. we have given you a couple different looks at the cost comparison, the cost impact to customers. assuming the rate changes go

into effect on july 1st, and i will get into schedule and a second, the proposed rate adjustment is projected to increase in 2019 and 2020 revenue for clean power s.f. from $212.9 million in the budget, to 225? $5 million, which is an increase of about 12.7 million dollars or 5.9%. the additional revenue associated with this adjustment is projected to improve progress towards funding its program reserve targets. under the proposal, we project that they would fully fund program financial reserves by the end of the next fiscal year, which is a year faster than projected under the budget. today, we have this report that we are providing to you on the rate implementation activities. looking ahead to, we will continue to monitor the p.g. & e

approval process at the california p.u.c. to determine when the rates will go into effect and whether there will be any additional changes. it is something we are looking very closely at. we are not anticipating major changes, but there could be some small changes. we plan to return to the commission with an action item to confirm the general manager's implementation of the december rate action that may occur in june or a bit later depending on what we are seeing with p.g. & e 's final rate action. and then finally, we will implement the new clean power s.f. rate following the commission action and once the effective date of p.g. & e's new rate is finalized. that concludes the report. i'm happy to take any questions if you have any. >> commissioners? i have a question, i am just curious. those persons that opt out, do they ever give a reason? >> we do survey them.

they are not obligated to respond, but we do collect that data. i would be happy to come back and provide a bit on the responses we are getting. i will preview that. they range from cost concerns with the program, even though we are delivering savings, some are still concerned about cost, some are concerned about local government's role in this enterprise, and others expressed they are satisfied with the status quo. those are the big three categories that we get. >> any other comments? any public comments on this report. >> thank you, very much. it is all very encouraging at this moment. thank you. >> all right. the next item is a capital improvement program quarterly report.

dan wade? >> good afternoon, commissioners i'm director of capital planning programs for water. i would like to give you an update on the third quarter for fiscal year 18-19 for the capital improvement projects. can you go to the slides? the highlights for this important period are as follows, and i won't read these to you, i have other slides that will hit each one of these, but they relate to the mountain tunnel repairs and improvements, the rehabilitation project, and the 2018 march storm damage emergency repairs and interim improvements. starting with the mountain

tunnel intermittent repairs, and phase two, which started in phase one in 2017, phase two has successfully completed the 60 day tunnel shut down with no impact to water customers. the repairs, contact grouting, and paving that were completed as part of this repair project were all done on time, and the project did reach substantial completion. we anticipate closing this project out next month in june. that went very well. as you know, we are working on the larger mountain tunnel improvement project, which is in design, and the design consultant conducted a 60 5% design workshop with our technical advisory panel, which are experts in the industry that we bring into provide critical review of the design documents,

and we met with them in january, in fact, we met with them just last friday. we are getting good comments from them, and the work is moving along very well. that team toured the dewatered water -- mountain tunnel in february, and they also toured the crossing of one of the critical facilities associated with the project at the river crossing on march 29th. and so we did just have that 95% presentation meeting last friday , and that went very well, the project is moving along. the waterville substation rehabilitation has had a lot of activity in the last quarter. we had a four-month outage as it was completed, and the reporting period -- report that 115 setting back into service, and construction on the 230 side is half complete, so we will finish

up that work this fall in 2019. and then work has continued on the 2018 march storm damage repairs. this has been a big part of our activity this last year. we were able to complete the dam safety related work associated with that project. the california division of safety dams loud the reservoir to be refilled and placed back into service just recently. and marcus and reservoir will be lowered again in august of this year for an installation of automation and a new gate at the tower. that work is continuing, but the lion his share of the dam safety work is essentially done to the satisfaction of dso d., but there will be ongoing work as

the year continues to finish that up. you may recall that mosca had requested that we report on the finances associated with this project, because it was not part of the capital improvement plan, part of the cip, so we had to borrow funds from other places in the program in order to fund this emergency work, and what this table represents, it is a lot of detail, but if you can see in the left-hand side, we essentially transferred $22.9 million from other places in the program to fund these emergency and interim repairs. we spend $1,020,000,000 to date. we do expect to spend the rest of that money because a lot of these contracts are still in progress, and the money will be paid out in due course, but we

do expect to be under that budget that was established. now in addition to these emergency repairs, we are planning a long term improvements project the markets facilities. it's not part of the current capital improvement program, but it will be proposed as part of the upcoming budget cycle. that has not been budgeted. the scope has not been established, but we do expect we will be needing to do longer-term repairs in addition to these interim improvements. i would be happy to take any questions now. >> what type of improvements? >> so the facilities are undersized for the type of, what we call the probable maximum flood event that could be expected, and so it would likely involve modifications of the flow, perhaps protection of the

dam in some way, also perhaps looking at the upstream diversion dam and how we get floods around the reservoir, and is a few other alternatives that may be considered as part of the overall comprehensive look on how to operate this facility going into the future. >> thank you. >> quick question. what is a debris boom? >> it is something that catches logs and other debris that may be coming down the river or the creek for it gets to the spillway. stand by mac --

>> i really appreciate it. thank you. any other public comment? next item, please. >> the next item is a quarterly audit and performance review report. >> good afternoon. can i have the slides, please? today, commissioners, we have the third quarter of our audit performance review to share with you. this represents the period from january to march of this year and again this report provides a high level review of our various audits and oversight projects that are going on here at the sfc and it looks forward to show you what we'll do over the rest of the year as well as giving you a check in in terms of the open audits and recommendations.

this high level summary shows we have 38 audits planned for the year. we have completed almost half of those. about 17 audits have been completed. we have another 13 that are in progress. about one-third of the total and then we have another eight that we're going to get going on here in the remainder of the last part of the year. we have four audits we started this quarter. again, the january through march period that includes our wholesale revenue requirement audit which is spending last fiscal year, fiscal '18 in years of the cost allocation between our retail ex wholesale customers for our water operating and capital costs and we have two clean power related audits that got underway. a data privacy audit as well as the verification audits which have to do with compliance associated with renewable energy and we have a city wide sales

and use tax audit of which we're a part of. wanting to make sure that the p.u.c. and its procurement pays the appropriate amount of sales tax. these are the audits that got going this quarter. in terms of stuff that we completed, very important audits are financial statements as high colleague, deputy c.f.o. hong reported to you over the past month or so. we have our financial statements for our three enterprises that those reports were wrapped up in january and reported to you shortly thereafter. we have our comprehensive annual report and our popular annual financial report about a month later in february. all good news there. just a reminder, our tenth year of consecutive no finding, no materials, no statement, sufficient internal control in place so all good news as it relates to our financial

statements. small audits was also wrapped up related to the 2014 transportation bond and the p.u.c. received a small amount of money with some of the projects associated with mission street involving sour infrastructure. so we were involved with that review and no findings there. abouin terms of the final quartf the year, we will wrap-up our royalties lease administration and i.t. network penetration testing audit. we will continue and wrap-up that data privacy audit for clean power and we have a single audit that has to do with looking a lot how federal money is sent so we're abiding by all the regulations. it's may, one more month and wore done with fiscal year '19 and that involves a number of things including an annual physical inventory count and again the point there is we want

the warehouses and physical inventory match with our record keeping so when we record things at year-end it ties out and is accurate so we'll count widgets so to speak. our financial statements audit addhas gotten underway. the interim work begins within the next week or so and they'll come on site and then the wrap-up of the audit will occur in july and august for fiscal '19. this last slide here just gives you a sense of checking in with where we were with our audit recommendations as well as three audits that remain open with 10 recommendations that are still open regarding and requiring a resolution. we've added this commission and we add an estimated timeline for when we anticipate closing these

open issues and i've added that here to this table to you see target close date and these remaining three as its anywhere from this coming june to the end of the calender year. and the progress that i will report to you now is last quarter when we checked in with you, we had 17 open recommendations and we closed seven of those and now we have 10. so great progress and getting that number down. and with that i'm happy to take your questions. >> any public comment? thank you. so i have one last comment. or announcement. today, we're going to have the golden pride award at the war

memorial. i think it's at 6:00. so i just wanted to invite you guys to come by and celebrate our award winners of the golden pride award. with that, that concludes my report. >> i would love in the future, because this is a second year, right of golden pride. third year. so in the future, and they usually are after the commission meeting? aren't they? not necessarily. i would love when they are to be able to have some acknowledgment and maybe them come here first so we can recognize them. it would be nice to do that at the commission level if possible. we can look into that and that would be great. >> perfect. >> next item, please.

>> public comment on item 6d? public comment? i thought i did call for public comment? no, i didn't. any public comment? seeing none. the next item, please. >> item 7 is other commission business. >> commissioners -- >> item 8 is a consent calender, all matters listed here are considered to be routine by the san francisco public utilities commission and will be acted upon by single vote of the commission. there will be no separate discussion of these items unless a member of the commission or the public so requests in which event the matter will be row moved from theder and considered as a separate item. >> i have a request from the public.

any item to be removed from the commission? seeing none. could you please read the items. >> you want me to read each individual item? i read the summary. >> that wouldn't be necessary. i'd like to move the consent calender. >> second. >> and that motion is approved items a, c and d. and not item b. >> i'd like to move the concept calender with the exception of item b. all those in favor. >> aye. >> opposed. the motion carries. now we will hear item 8b from susan carloff. i have a speaker card from her.

>> hi, i'm susan an fran resident and i'm with california native planned society. southern california's metropolitan water district is moving from recommending drought toller apartment planttolerant s and private citizens and all of the water districts plant locally native plants. these local native plants are adapted not only to the climate and the soils but also support by diversity of support wildlife such as birds and butterflies and bees. both san francisco and california have boy owe biodivey resolutions. i request they plant and recommend only locally in a testify plant adapted to our climate and soils but also to support san francisco and california's biodiversity resolution, butterflies our

being, birdbees, birds and othe. thank you for listening. >> thank you. how does this item read? it's just the insulation, correct? >> so this is a contract to actually do landscaping. i think it's more of a policy that with the department of environment and policy of replacing drought tolerant with native species and it's something that we can look into as we determine what plants need to plant on our watersheds and on our property. >> we would consider whether those native plants are drought tolerant or not? >> we would look at all of the

characteristics of the plants. >> if they're not drought tolerant, even though they're native plants, we would reconsider that? thank you. >> i have a good head motion back there. so, this obviously incorporated already in this contract. may i have a motion? on hb? i'll move it. >> second. >> further discussion? all those in favor. opposed. the motion carries. next item, please. >> item 9 is approve the terms and conditions of an authorized general manager to seek approval by the board of exercises and mayor to execute a memorandum of agreement with the city of mountain view with the term up to 20 years. >> good afternoon,

commissioners. tony assistant real estate director. today we asked the commission to authorized the general manager of the b.u.c. to execute a memorandum of agreement with the city of mountain view whereby the sfpuc will grant new eight new licenses to the city of mountain view and accept nine easements at no cost from mountain view. plus other considerations subject to board of supervisor approval. granting of the eight new licenses with no use fee, seven of them replace existing licenses but were also no fee licenses with mountain view. they're all for public recreation use, gardens, pedestrian and bike trails, public parks and playgrounds. landscaping. in addition, the p.u.c. will

issue a brand new revocable license and it's a no-fee license for use of 58,000 square feet of sfpuc property that will be designated as a park in mountain view. in exchange for the licenses the city of mountain view will pay the following monetary consideration to the p.u.c. mountain have you will grant the city nine new easements to fill title gaps and the sfpuc's right-of-way and mountain view will maintain parcel 199a according to specific sfpuc specifications and mountain view will pay property taxes for the sfpuc parcels it occupies. and mountain view will row move 29 trees from our row and clear

up the third party encroachments on a right-of-way. are there any questions? >> questions? any public comment? >> i move approval. >> second. >> all those in favor. >> aye. >> opposed. motion carries. next item. >> item 10 adopt finding of surplus property for an easement reserved at the san francisco puc for fire hydrant and water line and authorized a general manager to execute any documents terminated and sfpuc's interest in the easement. >> may i have a motion on this fire hydrant? >> i'll move it. >> i'll second it. >> any public comment on this item? further discussion? seeing none. all those in favor. >> aye. all those in favor.

>> all those in favor. >> aye. >> opposed. the motion carries. next item, please. >> item 11, approve amendment 4 to agreement number cf991 increasing the agreement amount by $4 million and extending the agreement duration by two years and eight months and execute a name change from your turs corporation. do we need discussion on this? >> i'll move a travel approval. >> second. >> my public. >> all in favor. >> aye. >> carries. thank you. next item, please. >> item 12 adopt a proposed

wholesale revenue requirement and rate schedule for fiscal year-ending 2020 as applied to meter readings on or after july 1, 2019 in accordance with the terms of the 2009 water supply agreement between the city and county of san francisco and the wholesale customers. >> good afternoon, charles pearl, deputy chief financial officer. this item is our annual presentation of wholesale water aids for the upcoming fiscal year. effective july 1 and just to be clear, we're not proposing any rate change in what is before you. rather than passing on rate change for customers directly we'll use the balance to corva

additional water and capital and operating expenses. there's one change in terms of a discount rate for our one wholesale customer who draws untreated water and that rate is going down slightly but other than that we're not proposing changes to the main unit rate. i'm happy to take any questions. >> any questions or comments? >> how do they use the raw water >> they use it and run it threw a treatment system. it's where they were in the regional and it's easier to draw the untreated water. >> i have a speaker card from mr. francis. >> thank you. i am the water resources manager for bosca and our c.e.o. couldn't be here today but she

wanted me to row lay that we're supportive of this resolution and the plan. i can affirm because i've been at meetings and the staff keeps us well appraised in terms of the rate development and the proposal to use the balancing account and we're as collective and happy with the situation that we're presented with today. so again, we support the resolution and look forward to continued work with your finance group. >> thank you, very much. i'd like to move the item. all those in favor. >> aye. >> opposed. the motion carries. i would like to call items 13-17 together. item 13 approve the water supply assessment for the project 14 approve the water supply assessment for the 88 project and 15 approve the water supply assessment for the proposed

balboa receipt voic reservoir p- >> we're going to have discussion of all four items and we'll take them into individually. basically the concept is the same. so we'll hear it separately as well. item 16 approve the revised water supply assessment for the proposed 598. item 17 the water supply assessment for the proposed 630 to 698 brandon street and i want to make note we did receive two letters after the publication of the package one from jean barish, dated 523 and one from alvin john dated 5/27. >> those have been provided to the public and to the commission.

>> good afternoon, commissioners. steve richy. we were here at the last meeting with several of these water supplies assessments and there are four that are held over from that meeting plus one additional one today. the one for balboa reservoir. these items constitute the same action for commission which is to provide information to the planning department that the planning department's request relative to the availability of water supply for the proposed projects. because the planning department is about to commence the ceqa review so we are required by state law to provide the planning department information about water supply availability. these projects at this point in time have been a little bit more challenging to do than previously because of the nature of the state where you resources control board action back last december which adopted the water

quality control plan for the bay delta for the san jaoquin side which was for the river. we have a straight forward a cements is there or not the water supply. in these cases we've had to identify three possible scenarios, four if you add in other supply projects we might develop. one of those is the plan is implemented as is. another is that the voluntary agreement that we've been working with the state on goes into effect and supersedes the water quality control plan and the third is that we unfortunately carry forward with the litigation that we filed as a protective measure and that litigation is the plan being set aside. those are all possible outcomes and we don't know which one will be the case. we're hopeful but we don't know

that for sure. we also identified potential projects that we're working on to provide additional water supply. so we talked through these a bit last time and one of the questions that came up in particular is the duration of the assessments. routinely because of the nature of the state law that requires these we have been using the minimum requirements of showing that we have enough supply to last three years because of the way we planned for our water supplies, we included at the request of the commission in here laying out to the entire eight and a half year drought sequence we have developed for water supply planning purposes because we have felt that that is a much more prude ant sequence and duration for a drought to prepare for than simply the bear men mum three yearminimum.what you see beforea layout of when would occur under those scenarios and of course the one that is really of most

interest is the state plan is enacted and implemented as put forward. that plan would have us go to rationing of up to 50% in the last year-and-a-half of an extreme drought. and that is the condition -- it's the retail side. the wholesale it would be 65% rationing that would have to occur to be able to provide that water if we didn't do anything else. so these are pretty extreme measures. we wanted to make sure it was clear there. i will say before we go into the final bid at this, that our job is to make sure there is sufficient supply so our goal is to make sure we don't get to that point. we want to make sure we take care of the environment but statement obviously we need to supply water for our customers. when you get to a 50% or 65% rationing level, that really is starting to cut very close to the bone and start to have

significant impacts out in the service area that we need to manage. we've laid out in here water supply assessments provided basically by the developers and how they fit into our water supply planning process and for these developments, a couple them are primarily residential and three of them i believe are mixed-use developments. so we prepared these or requesting of the commission is approval of this basic analysis to go forward and again in compliance with state law to the planning department so they can conduct the environmental review and you are not approving the project by any means here. that's a whole separate discussion that is led by the planning department. this is approving our statement relative to the vile abilit avar water supply. for each item as we reviewed them in detail, we did find a couple of inconsistencies in the

memos that there is actually fie single sheets of paper that shows the changes in the case of item 13 and 15. there's one change in red on the first and second page and the other items, 14, 16 and 17, there's a change on the second page. for clarification and consistency through the documents. with that, i'd be happy to answer any questions about the over all process and about what the analysis shows for us. >> ok, first of all, let's do the over all analysis. questions, comments? what approach do you think we should take? >> so, madam chair, since you already mentioned this is all going to be bundled because of the same metrics that we're asked for at the last meeting to be continued, maybe just for ex speeden see i