>> yes, i think there's still some uncertainty as to the sufficiency of the funds there. >> and on the part of that wildlife fund legislation, that had a -- i think of it as a poison pill, that any distribution of public assets would be reviewed by the cpuc, is that right? >> yes. any sale -- separate and apart from that, any sale of a public asset would be subject to review by the cpuc. that added some additional requirements to the existing requirements in public utilities code. >> and on the legislation

front, one of the things that i here that might keep dropping is the -- [inaudible] >> okay. that covers my question. it's -- we pick up bits and pieces from newspaper reports, and we obviously have our own briefings, as far as our litigation strategies, and all, but it's hard to see it come together in some way, and that's hard for us, and i would expect it's especially harder for the public to see this at one time. i appreciate this, and i hope we can continue to do this on a regular basis and treat it as we do c.c.a. and other

continues areas -- continuing areas of interest and concern. thank you very much. >> you're welcome. thank you. >> any public comment? >> thank you, president caen and commissioners. judd holtzman, 350 bay area. i just want to say that we support their push, among other things. just as a reminder, if this proposal were to go forward, then the pcia charge which we were discussing earlier would not be an issue nor would any number of cpuc proceedings and rulemakings which are maddening to even keep track of, much less participate in. from our perspective, i want to

really thank miss hale for her comment on governance. it sounds interesting but given the sfpuc's experience in running hetch hetchy, we would not want to see a downgrade in participation and governance as a result of this bankruptcy. and you know would not want to see a slippage in our clean energy or climate targets, and there's no reason to think that we would. i do want to lastly just kind of restate what i said in the earlier item, with the mayor, the board of supervisors, and this commission all pulling in the same direction for i think

the first time in the last 20 years that i've lived here on this issue, i am baffled that our governor is popping off with comments to huge media speculation, that maybe this energy system that tried to poke its way into our system, maybe they should take over. that's shocking to see as a long time resident of this city. and you know i know it's complicated for the city toic at thation positions -- for the city to take positions. so i'm not sure how our staffers work for the city, but i would assume that we have a pretty substantial presence in the capitol, and i would really hope that the city's very clear

wishes and desires on this matter could be made clear to the governor and to relevant staffers in his office so that i guess at the very least they might avoid taking steps or comments that would preclude our possibilities moving forward. thank you. >> thank you. any other public comment? >> so one item that's not listed, we wanted to give you an update on was treasure island. barbara, you want to give an update on treasure island? as you know, treasure island, the utilities there is owned by tida, which is the treasure island development authority, and we are -- have an m.o.u. to operate it, and so we can't invest any rate payer dollars, so it's been quite challenging

to operate it when there's very little money going into maintaining it because at the same time, they're hoping the developer put in new infrastructure. so at treasure island, they experience a lot of power outages, and i want barbara to come up and tell you sort of what we went through and how we were able to get everyone back on power. >> thank you. barbara hale, assistant general manager for power. so we had an outage that was first reported wednesday afternoon. the outage was -- it was clear that both treasure island and yerba buena island were out of electricity, so crews went out to troubleshoot and figure out what was going on. the troubleshooting, it became clear that both islands were out, and the troubleshooting focused on the oakland side of the infrastructure. so just to remind you, treasure

island has received electric service via an underwater cable that starts in -- on the oakland side right underneath -- right near the footing of the bay bridge. the connection upstream of that is to a substation that's owned and operated by the port of oakland. and then that substation is interconnected upstream with pg&e facilities. so when -- when oaboth islands were out and we conducted initial troubleshooting, we realized the problem was on the oakland side, and we followed a protocol to working with treasure island development authority to transfer the island to generator power, both refresh island and -- treasure

island and yerba buena island. we have a protocol where power will be out longer than six hours. and the protocol is we go to generators. troubleshooting and repairs continued. the equipment needed to complete repairs was procured. we -- whi we while were on generators, however, had a problem with fuel. the city fuel vendor could not commit to deliver additional fuels on time to avoid another outage, so we made the call to

shutdown the treasure island generator -- not the yerba buena generator, but the treasure island generator from midnight just to conserve the fuels. then, we got on a fuel schedule, and we thought we were in good shape. not so much, it turns out. the generator on yerba buena isla -- generator on treasure island failed. we were able to switch the customers on treasure island to the yerba buena generator.

we were able to identify some critical customers, in particular, the job corps dormitories, so we connected an independent generator to their building to get them power during the outage. meanwhile, we called for additional assistance from hetchy and modesto irrigation district to help with the repairs. so i just want to give a shout out to hetchy and modesto irrigation district and c.d.d. all of whom helped us to get the power back. ultimately, the power was restored on sunday afternoon. the generator repairs continue. they're in progress. we need to make sure we have that back up generator

repaired, as well. ultimately, the cause was a dig in on an underground cable. one of the cables that go from the port of oakland substation to the foot of the bay bridge appears to have been dug into at some point and then covered up and asphalted over and ultimately failed. so we -- you can imagine the -- the effort it takes to identify where in particular the outage is under those circumstances, so it took a bit of time to identify the specific location and to commence the work, but we -- we were successful in getting power back up. we will have an after-incident conversation internally to the p.u.c. to see what went right and what went wrong and how we can improve on our performance under these kinds of circumstances and with the city of division of emergency

management and with the treasure island development authority to make sure we work well as a team when circumstances, incidents like this occur. given the state of infrastructure on treasure island, i'm pretty confident that circumstances like this will recur, so we need to take the time to see what kind of lessons we can learn from this experience to upgrade the performance, and with that, i'm happy to take any questions that you may have. thank you. >> so what, then, are the protocols or are their new protocols -- are there new protocols in place, like, when any digging is happening around any sensitive areas that an inspection is done or something has to be done before you cover up? is there any protocol in place for that? >> yes, they were, and none of them were observed, apparently. >> so things were in place, they just were not observed. >> yes. and this is a little bit of a

different circumstance for us. we're used to dealing with the permits within the city, and this is -- you know, now we're talking about permits that are issued by oakland and potentially the port to the extent that some of this happened on port property. >> our port. >> no, i'm sorry. i should be clear. the port of oakland. thank you for that. so we were -- you know, one of the things that we need to talk about as a city sort of -- now that power's been restored is what sort of investigative efforts should happen to address the parties at fault -- identify and get redress from the parties at fault. >> but typically, when anyone digs, they call u.s.a., underground service alert, so they can be there when you dig

it up. and typically, when you dig, that's what would happen. i don't know what happened because we're not the owner of that line and we're not called in to mark it, right? >> i'll have to double-check whether that was port of oakland line or our line. >> but now that we are dealing with this because tida -- now, we have taken over the responsibility -- >> well, we have taken responsibility for operation and maintenance and keeping the lights on, but we don't have authority -- we don't own the facilities, we don't have the capital planning and budgeting responsibilities. we can make proposals to tida -- to the treasure island development authority and hope that they will agree that -- that the approach we're taking is right and that they'll fund it. they set the rates. the treasure island development authority sets the rates and levels the service for the customers there. >> and that is for the current

one, but when the new development happens, they -- those will be our customers, right? >> right. one the islands are both redeveloped, the infrastructure will be handed over to the city -- power, water, sewer will be handed over to the city and those cust -- they will be treated just like the hetchy customers. >> but in the interim, we've got some issues to deal with because that may be a while. >> correct. >> so quick decision -- i mean, decision, quick question. and it sounds like you guys just did a wonderful job getting in there and troubleshooting and everything, and there were a lot of decisions to make. i know that pg&e, you know, when they were starting to do the shutdowns or whatever, ultimately, as a p.r. piece, the c.e.o. was just taking the heat himself and saying i'm making the decision, we're going to shutdown here at this

time and shutdown here at this time. just curious from a department point of view, who made the decision to say, from 12:00 to 5:00 at night, this is the best decision. who made that decision? is that a team decision? >> that's a team decision. as the folks closest to the ground knowing what the capablity of the generators are, what the fuel spend rate is, we came to tida, department of emergency management, we had a consult call to say here's the circumstances, here's the recommendation. >> but i just want to make it clear, it wasn't a decision to turn it off. we were running out of fuel, so the question is when is the best time to shut it off? >> right. >> so now, are there underground fuel tanks? are we looking into that? what -- because as you mentioned, it will happen again. >> yeah. so -- absolutely, as part of

the after-incident report, we'll identify things like that. what's the sufficiency of generators to help us with the issue? what's the sufficiency of the transport of fuel? it wasn't that there wasn't fuel available, it was there wasn't a truck to bring the fuel to the generator. and it turns out, in all of the city departments, there is not a tanker truck apparently. the department of emergency management already identified that as a deficiency, and they have made a request -- a grant request to purchase one for the city, you know, so steps like that -- that's a problem that apparently hadn't been identified in the past and steps are being made to cure it? and the question is, is there anything we should be doing to help make that happen faster? >> yeah. if something happens to the bridge, then that doesn't

matter. so it seems to me some underground storage -- >> also something to consider, yes. thank you. >> public comment? >> oh, thank you. is there any public comment? that was quite an ordeal. >> yeah, it was, it was. >> i'm sitting here thinking, can we reverse the m.o.u.? >> yeah. i just feel very -- i feel sad for the residents out there. i mean with all the construction and the ageing of the structure and just the commitment to not keep it up to repair, they keep experiencing this problem. so that's the end of my short report, so thank you very much. >> quite a report. >> yeah. >> okay. madam secretary, the consent

calendar. >> clerk: item 8 is other new business. >> oh, thank you. new business? none. >> clerk: item 9 is the c consent calendar. all matters consisted here in are considered to be routine and will be acted on by a single vote of the commission. there will be no consideration unless a public or commissioner request, in which case the matter will be removed and considered as a separate item. >> okay. commissioners, removal of any item? okay. public, request for removal? may i have a motion? >> i'll second. >> all those in favor? opposed? the motion carries. next item.

>> item 10, approve the selection of cdm smith, incorporated for an amount not to exceed $15 million with a duration of six years. >> good afternoon, commissioners, kathy how, assistant manager of infrastructure. we're asking for a staff recommendations -- for you to approve staff recommendation of a contract with cdm smith subject to board of supervisors approval. this is an old treatment plant. we're also building a substation as part of this project, and so cdm smith also has aecom has a major sub under this particular contract. >> any comments? to the public, any public comment? may i have a motion? >> i'll move it. >> second.

>> all those in favor? opposed? the motion carries. next item. >> clerk: and i will read items 10 and 11 together -- i'm sorry, items 11 and 12. item 11, authorize the general manager to authorize an installment sale agreement to secure a state resolving loan in an amount not to exceed $132 million with a principal for givenessme giveness amount not to exceed $48 million. [agenda item read]. >> good afternoon. richard morales, manager at the

p.u.c. today, you're being asked to consider two separate items to provide low cost state revolving loan funding for the wastewater enterprises capital spending program. although the s.r.o. loan programs you're being asked to consider are almost identical, they are two separate items, and they cover two actions, so they'll be presented as two separate items. quickly, the presentation will provide a brief background of the p.u.c.s involvement with the state revolving fund loan program. i'll also describe the two proposed loans under consideration today and finally, i'll summarize the requested actions. so p.u.c.'s involvement in the state revolving fund or s.f.r.

program dates back 20-plus years when we executed 30-plus loans totaling over $280 million. however, those loans did not provide some advantage to us. recognizing this is an issue for the sfpuc as well as other borrowers inful california, t state revamped the s.r.f. program to reflect more advantages for borrowers. for example, the interest rate terms were made more favorable by having the rate set by the state on one of the state's most recent general obligation bond issue, which is generally a low interest rate. so in 2013, they paid off the

old loans, and then in 2015, we received permission to obtain new loans under the new s.r.f. program. since then, we've executed four ssip projects totaling $94.6 million and a $186 million loan. i should mention that this includes principal forgiveness. what's that? well, the loan is $186 million, but we only need to payback

$171 million of that. when comparing the s.r.f. loans executed to date versus revenue bond financing, we saved the rate payers a combined estimated $168 million over the life of these loans, so these truly are low-cost loans -- long-term loans. so today, you're being asked to consider the approval of two s.r.f. loans, both for ssip projects. the two is a loan for the biosolids plant project. you may recall back in july 2018, the p.u.c. executed a loan in the amount of $699 million for the biosolids project. this s.r.f. loan will pair with

that for approximately 65% of the $1.6 billion project. the other is a $54.3 million for the o.s.p. digester gas utilization upgrade project. this will fund 100% of the o.s.p. project cost. in terms of the loan, each will have 30 years of maturity with an estimated fixed rate of 1.3%. this compares against 3.5%, which is what we would get in a revenue bonds. we estimate a combined savings of $84 million to the rate payers over the life of the

loan. so if you approve this, we expect to close them with the state before calendar year end. so we're asking the commission to take two actions today to approve the srif for two ssip projects. and with that, i will entertain any questions. >> questions? comments? >> a question. so where do they get the money from. >> so they -- very good question. so they actually get their kind of seed money -- it's called a capitalization grant, and all state -- or most states have an ssip program. so they take that, and then other s.r.f. programs, and they create these s.r.f. funding programs. but the other is capitalization grant from the federal government, so specifically, the e.p.a. >> thank you. >> you're welcome.

>> okay. we are to vote on this separately, as i understand, so i would like to call for public comment on item 11 first. seeing none, may i have a motion on -- >> so moved. >> second. >> it's getting late. it's hard to get this -- all those in favor? opposed? the motion carries. moving to the next, is there public comment on item 12? okay. may i have a motion? >> i'll move it. >> second. >> all those in favor? opposed? the motion carries. >> thank you. >> thank you. next item, please.

>> clerk: item 13, approve the deappropriatetithe -- [agenda item read]. >> barbara hale, assistant general manager for power. as we mentioned, the city provides affordable housing, recreation, infrastructure. the disputes with pg&e on the connections are summarized and reported quarterly to the commission and the board in a written report. to understand this opportunity and prepare the offer, the

city, acting through the city attorney, contracted for services. funding is needed to continue this effort, both to fund staff time and consulting time and city attorney time. we've been briefing the commission throughout this effort on both disputes and the acquisition efforts in closed session and i'll just remind you that any question you have today that's appropriate for the closed session can certainly be addressed at that time, and we can then return to open session for consideration of a vote on this item if that's deemed necessary by the commission. so you can see that we're anticipating funding of $17.2 million through the end of this fiscal year. that's a substantial sum, and

what you see here are the functional services that we prepared to execute on the offer, to be prepared on the offer, and that includes the engineering services for the separation of pg&e, the financial needs, and to be ready to operate the newly expanded power services. so where are we proposing the funding come from? what you see here is defunding of projects. we had a board action that appropriated $4.5 million towards this effort, that when the effort succeeds would be refunded to the two -- the

eraf. and we've identified a shortfall of a little over $10 million. the project -- the appropriatation request is the sources where we propose we reach into our budget to close that gap. these are projects that are complete that were completed for less than appropriated, or they're ongoing, and we can release some funds, and they're projects that are ongoing but delayed. so funds can be requested back when they're needed. let's dig in a little bit on that. so what you see on this slide is that list of the appropriations requested, and the only area identified here

in green where we expect to come back to you at a later date to request those funds again is for the alice griffith candlestick point development area. we are progressing well on that project. we have more funds in that project than we can spend at this point. you'll -- you have proeapproprd in capital funds for this project, and the ten-year plan continues appropriations. we plan if spending goes apace with the pace today, we'll be coming back to you in 2026, requesting funding to be re -- that $4.5 million to be reestablished in our capital pl plan. but at this point, we have the funds, we know we're not going

to spend them. we recommend those projects that you see listed here be deappropriated, and we expect it will not present any lost opportunities. there are no critical projects that would be delayed or cancelled as a result of this. for example, fire safety, mountain tunnel repairs, station line repairs and replacement projects, street light levels projects of service, all of those things would continue. this request would be a temporary cash management exercise of moneys that would otherwise be unspent this fiscal year, and we will continue to monitor the cash flow needs of this these projects and of this project to

ensure that critical projects remain on schedule. with that background, i'm happy to answer any questions that you may have. >> so i have one question. i don't quite understand the $4 million-plus for alice griffith, and what does that mean? that was a very important project to so many san franciscans as part of the crazy redevelopment that's taking place or not taking place down in that neck of the woods in bayview and hunters point, so i'm just wondering what the 4.4, whatever the number was, actually represents? >> yeah. so we have appropriations in our spending and are continuing to work on this project. >> is this just utility stuff? >> it's just utility -- it's just electric utility components of the alice griffith and candlestick point

redevelopment. we've already invested and reconnected much of alice griffith, so the work progressed. we know we will have further work down the road, and the capital plan -- the ten-year capital plan has a continuous funding stream for alice griffith candlestick point to meet the spending pace. we know that between now and the end of the fiscal year, we're not going to spend $4.5 million on alice griffith. we will get another infusion of funds for alice griffith in the next fiscal year. >> so if somebody says you're taking $4.5 million from alice griffith, that is the economic answer. what's the -- how do you fuse a political answer? >> yeah. the project is not going to be -- the project progress is not going to be impacted negatively by our asking for these funds to be

reappropriated today >> a better way to look at it is a cash flow, so if we have money that we're not spending, why not ask for money when we have it? so we're just -- knowing that we don't need it until later, let's spend what we have, and when the budget cycle comes, we'll just ask for the money, i guess, next year. >> mm-hmm. >> thank you. >> mm-hmm. you're welcome. >> couple of questions, if i could. first of all, of the projects that you have listed there. >> yes? >> i think i know the answer, but i just want to make sure for the record that they're right. hetchy assets are classified as water power or joint, and water assets that are either water or joint have funding contributed by our wholesale customers. are any of these projects classified as either water or

joint? >> no. >> so there is no impact on our wholesale customers on the balance of the account or any of that? >> correct. no impact on our wholesale or retail water customers. >> okay. thank you. could you talk more about opportunity costs of using this. it explains pretty well why it's surplus or why it's available. could you talk more about allocating this to this use and why not other uses? >> correct. when we decide to spend money on x, we're choosing not to spend it somewhere else. so that's the basic question. do you want to spend it on this, because if you've spent it on x, it's not available for something else. here, we're talking about

taking dollars that were already appropriated to power energyize project and put it to another power energyize project. so we look at it as expenditure of funds for downtown, if you will, power projects. >> okay. the -- i'd suggest that the opportunity cost is real; that in the normal course of events as the capital program goes forward, there are projects that come in low and make funds available. there are some that come in high, and they need some more money. and part of the management of the capital program as a whole is you make surplus funds available to fund projects that needed additional money. by allocating this to this

project, those moneys are not available to deal with excesses in other projects. >> correct. >> which is just kind of the arithmetic of it. >> right. >> we've also heard today that, you know, hetchy's fund balance is below the reserve level -- i should say below the low end of the reserve level that was established by policy. we also heard that we would be hearing in the not-to-distant future about a need for more money for wildfire mitigation. we also -- and every time we do a capital project or a capital project, there are projects that we just can't get to with the available funds, and those are put out either beyond the ten years -- in some cases, if it's big money, there's not necessarily a plan for how

we'll go and ever fund those things. and we've had some work and considerable testimony in front of the commission that challenges that hetchy has going forward in maintaining its assets and maintaining its market positions as well as the financial health of the entity. so i am concerned about the opportunity costs. i also -- you said that it was a -- a temporary cash management device. and i'm fine with that as long as it comes back to us at some time. if we're surrendering it forever, i need to be more clear on what those opportunity costs are.

could you talk about how we get this money back? >> well, first of all, the way i look at it as an opportunity cost is right now, the current situation is not working. we can't hookup new customers because we're in this constant battle with pg&e, so the revenue that we've estimated will come in, we're not obtaining that. so the two sides of the equation is we're produce the power but we're not able to sell the power. so that's why we based our estimate on the budget of how much power we can sell. so this is not working, so we're looking at ways to to be able to sell our power in a way that we feel that we can sell the power or hetchy power to our customers or to new

customers. and so a lot of this has sort of, i would say, tied to opportunity costs to our business line of, you know, being able to freely sell our power to these customers. however, there is a component to our business that we have city departments that could be paying more. and so that is something that we're trying to address, as well. and then, there is just the future of the city wanting to move from independence, and so i'm -- you know, so we are looking at all phases of how we can try to move in that direction. but what i just want to point out is we had to do something. the current situation we're in, that's the position that we're in. we just can't afford to

continue in our current status, where we can't move to get more customers, or if a customer that we currently have want to upgrade, then they're faced to -- going back to pg&e, and it's something you're well familiar of. so we should talk more about it. maybe closed session, but i would definitely want to -- >> and i appreciate your comments about the revenue implications of not going forward, and that is certainly part of the equation. this is part of what you can do in the corrective actions in the bankruptcy if it will

ultimately be successful. this is a not insignificant amount of money that we're putting forward on the hope that it will solve a problem, and i support doing it. none of what i say should be taken as a reluctance to go forward. what i would say is we should be aware of it, and what the risks are, and by doing this, we don't foreclose solutions to other problems. it would be the height of irony if we were to sacrifice our own program to obtain assets of something that has not been maintained well. so where that leads me is a conclusion that we need to be able to get money back, and we

need to make sure that as part of our budgeting process, with you deal with the kind of -- we deal with the kinds of issues that you were talking about, the number of services that we're providing to the city and not even covering or costs. it's not -- covering our costs. it's not about making cost, it's about covering our costs. so as we proceed with this, assuming we do, i will be looking very carefully, and will be willing to help in any way that i can to make sure that the budgeting process going forward needs to make sure that this is made whole. this is not free and found money without purpose that we need to be made whole on that. >> so two things that i would point out. back in the day before prop a and b, i believe. hetchy used to just generate

money and give to general fund. $500 million. we can't afford that anymore. so i would rather say, instead of give me the money back, let's come up with a plan where we can be solid business because quite frankly, the money that they would give us back, i'd rather them do other things. so we can talk about that. >> okay. and part of why i'm talking about it is that i don't want anybody to think that this is just found money, that you can just go to hetchy. you need $17 million? no problem. here it is. that's not the case, and we do ourselves and everybody else a disservice if we allow those kinds of perceptions to persist. so i care a lot about that. and there may be other ways of

dealing with it. i'm very glad to talk about it, but the one thing i'm not willing to do is pretend that this is free and found money, and that this isn't costing somebody somewhere. it is. >> that's true. >> and probably the clearest version of that is just the -- the -- you know, the fund balance policies that we have. what we're saying is, we could pay that off a couple times over, get into policy compliance, if we allocated some of this money to that purpose. but by choosing to do this, we are choosing to violate our own policy, and that can't be viewed as an insignificant thing, and i'm going to be looking to the creativity of staff and the mayor's office and the board of supervisors to make sure that this does not compromise or financial health. we cannot allow that to happen. >> fair enough. >> i quite agree with you, but i have a question of a different nature.

>> mm-hmm. >> the 17.2, is that the bare minimum? i mean, have we -- we're going to be financing the project -- acquisition, i should say, but we really don't know the outcome. so we have to look over a number of years, i would imagine. >> yeah. and we'd be happy to talk further in closed session about sort of the different pathways and what the years could mean. >> okay. i'm somewhat inclined to put this over to the next meeting, i don't know. >> closed session, or -- >> well, don't we have to vote on this? is this an action item? >> so to the extent we can answer questions in closed session, and we can reconvene

after closed and address this if you're prepared to at that time. so i'd suggest you keep your options open after the closed session and revisit this item at that time and make a decision as to whether it needs to be held over or whether there's comfort in voting on that today. >> okay. does that make sense to everyone? okay. >> thank you. >> thank you. >> clerk: you want to call for public comment? i guess we'll call for public comment when we return to the item. >> okay. next item, please. >> clerk: item 14, adopt the final mitigated negative declaration and the mitigation monitoring and reporting program and the findings as required by the california environment cal quality act for the mountain tunnel improvements project, project number cuh 10221, mountain

tunnel improvements project. this action constitutes the approval action for the purposes of ceqa. >> kathy how, assistant general manager for infrastructure. i can answer any questions. >> that would be fine. are there any questions? we don't have to have a presentation on this. any public comment? may i have a motion? >> so moved. >> move it. >> i'll second it. all those in favor? opposed? the moel the motion carries. next item. >> clerk: item 15, approve and authorize the general manager to implement safety prequalification procedures to qualify construction contractors to bid on sfpuc public works projects. >> hello, commissioners. the item before you is the proposed safety prequalification procedure to qualify contractors to bid on

sfpuc construction contracts. randy parent will present this, but i just want to give a little background. he has over ten years experience as a deputy city attorney, and he is the city attorney assigned for all sfpuc-related issues. we keep him exceptionally busy. on average, san francisco advertises 30 to 35 construction projects worth about $350 million worth of projects a year. in 2020, we already know that we have five contracts that will total more than $300 million. starting as part of the ramp up of the water system improvement program, sfpuc had a question

regarding one contractor's safety record. as randy will discuss, the city is making safety on construction contracts a type priority. i would also just like to give special recognition to my colleague, greg lyman because he has spent an uncounted number of hours shuffling the information and projects with many contractors that bid on sfpuc contracts as well as other chapter 6 department of public works contracts. so now i'm going to hand it over to randy parent. >> i have a question before the presentation. who did you say the stakeholders were that you brought in to speak to? could you repeat that list again, please. >> absolutely. we worked with other city

chapter 6 departments, we worked with safety experts steve bowers, we worked with city risk management office, we worked with two city contractor offices, a.g.c. and ucon as well as ucons safety expert, and we reached out to other contractors that bid on city work as well as other chapter 6 departments. >> i thought i heard you say the word a.b.c. in there somewhere. >> no, sir. >> okay. a.g.c. did you -- one more question. did you reach out to any of the, say, unions that represent workers that do so much of the work at the p.u.c.?

>> no, sir. >> let me begin. i'm randy parent. i'm a deputy city attorney. i'll try and be as brief as i can. this is reasonably complicated. >> mr. parent, we -- i don't want to have a -- i don't even think -- we're running out of time, so if you can make it as brief as -- and complete as possible. i don't want to lose my quorum. >> no problem. i will trunkate what i had planned to say as best as i can. let's go to the first slide. historically, the city, going back before wsup, transferred through contracts all responsibility and liability for safety to contractors in order to avoid liability to the city. with wsup, the city adopted

contractual provisions mandating safety and greatly improved construction safety where it was 50% better than average in the industry. go on. sfpuc is responding to an auditor report from the controller's office recommending that the chapter 6 departments be more proactive on safety measures on construction projects, and in particular, be more proactive in the procurement process on the determination whether a contractor is responsible. as you know, we need to award contracts based on the lowest responsible bidder who submits the lowest responsive bid. in the past, the p.u.c. has not

looked in depth at the safety issue in part of its responsibility determination. in august on the m.t.a. tunnel project, a contractor had a fatality, and he received an osha citation for that. a couple months later, the board of supervisors audit and oversight committee convened a meeting to look into how the chapter 6 departments vet contractors on the safety issues prior to procuring the services. in particular, the chapter 6 departments got direction from the supervisors in that meeting that -- that those supervisors on the committee would like the chapter 6 departments to take a more proactive approach in looking at safety issues in the procurement process and the safety determination. the chapter 6 departments as a whole tried to get together on that.

it's a difficult proposition, resulting in because p.u.c. had more big projects on-line, p.u.c. stepped forward and took the lead on developing a procedure to go forward with and we have the agreement that we adopt the resolutions before you. based on we roll it out, make any tweaks that we need to make, but i'm fairly confident we'll have all the chapter 6 departments on board with that. >> randy, just for folks to know what chapter 6 departments that have contract that is right that can go out and do construction contracts, so i just wanted to put that out there. >> we were able to retain a consultant who's internationally known on safety. i won't read the slide to you. he's got very impressive

credentials working for intel construction as well as a number of high profile projects here in the city. so in your agenda item, the procedures are written down into a form that contractors can fill out. it's a three-part exercise. the first two parts are based solely on information that's in an osha 300-a form. this is a mandatory form that contractors must submit under penalty of perjury to osha. the first two parts deal with -- the first part deals with if it's in the osha 300-a form, the nonfatal injury and illness rate, the contractors report. the second report is the lost work rate that contractors report to osha. lost work rate is when injury results from days away from

work, restriction or assignment away from work due to the injury. part one on the nonfatal injury report, there's only three questions. if the contractor can answer based on osha, they don't have to go further. if they don't prequalify, there's a part two, with four questions, and if the contractor can answer no to all four of those questions, they can prequalify. for those contractors that don't prequalify on those two steps, we developed a consultant with the experts to evaluate a contractor's safety performance and its procedures. the first part looks at