>> president caen: good afternoon. i'd to call to order the regular meeting of the san francisco public utilities commission. today's date is tuesday, january 14, 2020. roll call, please. >> president? here.

vice president is expected shortly. commissioner moran? here. maxwell here. paulson is expected in a bit and we do have a quorum. >> president caen: before you, you have the minutes of the december 10 meeting of 2019. any additions or corrections? >> i'll move approval. >> president caen: any public comment on the minutes of december 10? all those in favor? opposed? motion carries. next item, please. >> item 4, general public comment, members of the public may address the commission on matters that are within the commission's jurisdiction and are not on today's agenda. >> president caen: i have three speaker cards here. the first is dave warner.

>> i don't think i can present this, but can i hand it out. >> you can put it on the overhead. >> i'm dave warner. i'm a palo alto resident. i'm also a participant in the mayor's water supply stakeholder group. some of you know i've been speaking at your meetings for three years now, which is a terrific honor.

the sfpuc is not sharing draws. it's more important than after as you face major decisions. should we invest an additional $2 billion or more to develop water supplies and raise the rates accordingly to cover the costs? should we implement rationing as has been suggested? how do we assess climate change? what is the right balance for water in ecosystem in drought risk. addressing these topics is more difficult. here's a chart that is the image here. it's often a way to determine probablities. my point is, that you should ask staff to invent their own analysis and share it with you. if you knew the probabilities, you'd know better how to spend the $2 billion. the chart is a frequency of the

low storage point of every 8-year sequence in the last 1100 years. the horizontal is the amount of storage remaining at this low point during this 8-year period. the vertical is the occurrences and that low point of storage. for each period, below each year, the low period was identified in the chart. given we have 1.5 million storage capacity, you can see that we use very little of it. that's this black vertical line over to the right. that's where most of the time we end up with the storage, which is just what we want. you can see the chart has -- that in the chart, the 8-year period is requiring more storage, becoming rarer as the storage increases. and that's -- you can see moving

off to the left how the instances go down. many exciting parts, but you can see the period using the first six years of the design drought is small, but not nonexistent. for storage using the first seven years of drought, that is the second one from the left. there has never been a drought that used that much storage. storage is exciting, also ask in the case of climate change, what if my -- [bell ringing] >> president caen: yes, we would appreciate that. thank you so much. the next speaker. peter?

>> i also have a few images to share. peter, policy director for the tuolumne river trust. as you know, demand has been way down. the first trigger was the plant that raised the price of water, sending a price signal and then the drought response. since the drought, demand has rebounded a little bit, but it's interesting, this fiscal year, ending last june, demand was down from 2018. it was 192mgd. this offers us a real opportunity. so i looked at what would happen if the sfpuc contributed share of 40% unimpaired flow for the first two years of any sequence.

if we hit a third year, you say we're not going to volunteer, we'll go back to base flows. in that scenario, you end up with 105,000 acre feet in storage. following up on commissioner vietor and the need do something immediately, that is an easy thing to do. give your share of 40% for two years and if the drought continues, you can cease doing so. level goals exceeds them because you get through the eight and a half years with no rationing at all. here you see what the benefit would be. you see the original slide, often we point to the 2012-2016, when the average unimpaired flow was 12% for those five years.

and then the water had to be dumped in 2017. this looks at the first two dry years in the sequence. it actually assumes also that the irrigation districts are contributing their share of 40%, which wouldn't been easy thing to do. you imagine those yellow bars half as big for the sfpuc share. but that's a big improvement for six years, if the last 25 years of hydrology were to repeat. and that's something again that fits into your level of service goals, so i hope you'll consider doing this. thank you. >> president caen: thank you. next speaker, mr. da costa. >> commissioners, i want to discuss a number of issues. the first thing that has come to my attention reading some of the

documents is in the bayview we have an address and it's named the south community facility commission building. now somebody has chosen to remove the word community. let me tell you, for those -- i know there are some people going with the removal of the word community, but any way you look at it, that building was built by the community. the community who understood then many years ago that they needed a building more for educational purposes.

and they needed some space, or they call it that time, horticultural uses. they had that vision. and we see over the years that has been eroded. and eroded in recent years by some people thinking they can build a better building which is prone to flooding. i don't get it. but maybe you all need to know what is going to happen in the future. i'm not going to predict, but i do know that if anybody tears down the building at 1800 oakdale to build housing, that's wrong. and i do know that if you choose to build a building for

recreational purposes at 1550, that is wrong, too. having said that, i attended your budget meeting. boring. boring. boring. and i try to -- don't try to hood wink us by moving the targets by saying we're going to do this after three years, seven years, 15 years, and whatever. we started with a $6 billion for our sewer system improvement project. i bet you it's going to go up to $20 billion. think about that. thank you very much. >> president caen: thank you. anyone else like to speak? okay, moving on.

communications. any comments, statements, commissioners? any public comments? moving then to the report of the general manager. >> all right. so the first item is the 2018 hetchy energy benchmarking. >> good morning. i'm going to use the overhead to go through our 2018 energy benchmarking report. the energy benchmarking report is a requirement of annual requirement of city regulations.

we prepare it for the city. this is our 8th reporting year. and it's really provides data to aid and educate our customers. it only looks at a subset of our customers. it looks at municipal customers, so it's excludy hetchy, it excludes our direct business and residential customers. it excludes our clean power sf, but it's inclusive of buildings like this, san francisco international airport, schools, community college, a lot of the rec and park facilities, our own puc facilities. a lot of the bread and butter city service functions are benchmarked under this report. so let me talk about the approach that we take to do this. and what the results are.

so we utilize a nationally used approach. it's a tool called the energy star portfolio manager that is -- was developed and is managed by the u.s. cpa. and what we do, we rate buildings' performance by the type of facility. not all facilities that the city operates have been included by epa, so the report isn't able to benchmark all buildings, but we do benchmark all buildings that the uscpa has a facility type identified for. and it sets performance benchmarks. the idea is that no matter where you are, you can look at a building and understand the energy performance and compare

that to similar buildings within the community, similar buildings across the nation. and try to get a sense of what your overall performance is from a energy use intensity perspective. it looks at the carbon footprint of facilities and for san francisco, what we do, we look the our electricity consumption at these facilities. natural gas consumption, steam use. and calculate an energy use intensity based on the building's square footage. it measures more than 49.5 million square feet of city facilities. so that's the approach. now let's take a look at what we've learned about city facility energy use applying that approach. so what you see depicted here is the fact that on average, when we take out san francisco international airport -- they're a really big energy user and we

want to tell the city story, not just the airport story, so telling the city story excluding the airport, our energy use intensity fell 1%, our carbon footprint fell half a percent from 2017 with reductions since 2009 of 15.2 and 24.8% respectively. here's another look at some of the same information but by facility type. so here you see the categories that the uscpa uses. airport is a category, a facility type. education a facility type. transit stations, a facility type. you can see the slices. the puc performance would be in the -- i'm not going to call it

a color -- purple, lavender, that shows service repair and storage. and this green color here which is offices. that's where most of our facilities would appear. this reporting function we've been performing now for eight years has been used by other city departments to help them identify where they need to focus some of their capital improvement efforts with respect to energy. so we use this to help educate them about how they should be improving their facility. you can compare, for example, a police station to another police station in the city. firehouse to another firehouse. school to a school. but as the department head or operator of facilities, you can get a sense of where you're performing well, where you're not. are there operating differences that can be addressed to improve the energy performance?

so again, we're seeing more efficiency compared to 2009 because our hetch hetchy is zero carbon. what this report is telling us, we need to focus our help with our customer departments on converting natural gas to electricity. we have 93.3% of the city's carbon from facilities, carbon emissions from facilities, are from natural gas use. so more fuel switching, more of a focus in the programming on fuel-switching is part of the message that we're learning from this benchmarking effort. as we present our budget on the 30th of this month, you'll see that some of our customer program work is taking that seriously, focusing dollars toward electrification. with that, i'm happy to take questions.

i'd like to acknowledge the work of dan heffernan and charlotte on my team who compiled a lot of information that came from a lot of different forces throughout the city to put this report together for you. and we have it posted online. it's also available if folks would like to get copies. thank you. >> president caen: i have a question. or two. so 93% of our city facilities are currently powered by natural gas? >> 93% of the city carbon emissions are from natural gas. so most of the facilities use both electricity and natural gas. because our electricity is carbon-free from our hetch hetchy system, when we're looking at carbon footprint, we know it's not coming from electricity consumption. it's coming from their other uses. steam and natural gas.

>> president caen: so the strategy -- i know we'll hear more about this in the budget hearings to decrease that portion of their use, of their emissions, will you have specifics? it sounds like the goal is to convert that 93% remaining to electricity if possible. >> yes. >> president caen: how long would it take? how much would it cost? and you can answer that during the budget. >> great. >> president caen: but i'd be curious about that. >> sounds good. >> president caen: and how much we can do in the next budget cycle for example. >> i want to put a quantity toward it. if you have a building and you have a little gas and the rest is hetchy and hetchy zero. you see 93% is from a little source. i think we want to quantify how much each building, because sometimes we get diminishing

returns for small amounts. >> my sense was it wasn't the emissions tracking as much as the use tracking, so to differentiate between what the supply is and the emissions are. >> right, we'd be happy to talk about what we've done historically. and the general managers, right? we want to focus on intense successes. so we'll talk about that during budget when we talk about how we're spending some of our customer program dollars in the capital plan. >> great. then my second question is around the private sector. well i guess the two pieces that would, i hope come next, which is the cleanpowersf and then the private sector and what opportunities might be, first to like apply this model approach to them, to be able to measure. because i bet that might be an appetite, especially with the

clean power customers, but are there strategies to apply and roll out with cleanpowersf in private or some combination thereof? >> we'd be happy to talk about that. the ordinance that requires us to prepare a benchmarking report for the municipal facilities, also requires certain commercial buildings to similarly report their energy use intensity. so i can talk about that and how we might be able to use that information on the cleanpowersf to inform our customer program approach. >> that would be great. >> do we know how our airport compares to other airports in size? >> in size, i don't know. i can come back with that. >> president caen: okay. thank you. >> and this report includes --

this is a question, although it sounds like a statement -- general fund departments that get power below cost and departments that pay a higher rate? >> correct. >> are we prioritizing for people who pay the higher rate? >> in terms of customer program dollars or --? >> yes. >> no. we have taken historically, taken the approach that the general fund customers typically don't have the resources to apply to help solve these problems. so we have prioritized our support for the general fund departments. the enterprise departments, we have supported by helping them access some of the same professional service consultants that we use. but we don't fund the actual tax that those consultants perform

for them. >> okay. from the business planning standpoint, the more general fund departments that we spend money on, the more electricity they buy, the more money we lose? >> yeah, so historically our focus has been on reducing their consumption of electricity. so that's why we have historically taken that prioritization approach. as we shift, then we're going to need to think about where our priorities lie. as we shift towards increase fuel-switching to electrification. >> and just to am plyfy that, when we talk about how can we reduce their consumption, when we look at the cost of changing out heater system, or some system like that, they look at the cost and then the payback on the reduction of utility bill

just doesn't pan out. so it's kind of in our best interests to reduce their usage, so it reduces our loss. and then the general fund departments -- i mean the enterprise departments have resources, so they would be more mindful and have funds to help address some of the -- >> the point i was going at was the last one that barbara made. as we shift to an energy source shifting program where we're increasing electric demand, the logic flips. >> another aspect of that to bear in mind is the funds that we're spending, oftentime the funds we're spending, for example on the general fund department, converting their boiler to an electric boiler would often not be our hetchy revenues that we're spending,

but rather dollars through cap-and-trade and fuel programs where we're restricted to spending those dollars on carbon reduction. and in communities that are regarded by the state as disadvantaged. >> thank you. >> have we seen this report in the past? >> you have. this is -- i haven't done a presentation of it in a number of years, but it's always distributed to you and your communications. with a cover memo on it. since we're going to -- since we have a stronger focus on customer programs, it seemed appropriate to highlight it. and clearly, there is an interest, so i'm glad i did. and we'll talk more about it in the budget and subsequent commission meetings as we develop programs. >> president caen: thank you. any public comment on this report? >> the next item is the bay

delta water quality control report, mr. ritchie. >> good afternoon. steve ritchie. i'll make that brief, working with the state and other entities on voluntary agreements that could be enfolded into the bay delta water quality control plan. there has been very little activity since the middle of october. not a lot has happened. the state, i think, is in a lot of internal communication about where they would like to see this go. they have released raw modelling results which we've had a chance to vie and provided -- review and provided comments back to them where we think they misunderstood some of the parts of our voluntary agreement, but those are just little comments. so very little has happened in terms of any larger group

meetings. there have been small meetings, but nothing significant. the one thing the state has done in the last few months is put together their water resilience portfolio. this is in response to have governor's executive order last year to make sure we're taking a broad view of things water. it's about a 200-page report, 150-page report. it's got about 125 recommendations some of which are, i would characterize, as go and do what we're supposed to be doing. so there is not a lot of new stuff in here relative to the bay dealtal plan, the one action they have is complete the update to the bay delta water quality control plan for the san francisco bay and delta as required by law and implement the plan through voluntary agreements. so that's what was said. so there is -- they put a lot of energy it looks like into this.

this just came out about a week ago. we're looking at it. they're looking for comments. we may provide some. but it's frankly, it's plain vanilla kind of stuff without any real direction given. so hopefully there is a meeting scheduled for today to take place in sacramento. they put it off yesterday for another two weeks. again, they're trying to, i think, work their way through the difficult issues within the state government on this and hopefully, we'll see progress soon. >> who is the main driver of this whole process? i mean, is it cal p.a., department of water resources? who is the one that puts off the meetings or calls the meetings? >> this wasn't part of that process. this is separate from a separate governor executive order. the governor when he came into office back in early 2019 said,

you know, i think we should really pursue these voluntary agreements and tasked wade crow foot, the secretary of natural resources and the secretary of kali p.a. to make it happen. within those organizations, there is california department of water resources, department of wildlife, there is the state water control board. so there, you have five entities and i do count the secretaries as separate entities, because you find that the state government agencies do not walk in lock step. they might try to present a unified front, but they have different viewpoints on things. this is a very difficult topic. so the secretaries have been at various conferences saying, yeah, we need to make this work, but it's a full-time job to pay

attention to all the details to get through it. who is driving it really? i think the governor said i want to do this. i think his patience may be running short. but i think people are finding it's difficult to get people close to or on the same page. so i wish there was one place we could go and really make a difference. and that doesn't seem to exist. >> commissioner vietor: aren't there time lines that we need to comply with? i mean, that have passed? as far as coming up with a plan and beginning implementation? >> in december 2018, when they adopted it, there was march 1 deadline to provide more detail. something happened there. they said let's have a new july deadline. there, that happened. the next deadline was okay, let's get to october 15 and hopefully we'll have voluntary

agreements ready for environmental review by the state water board. that date passed unremarked. and there has not been, really, a new deadline of something. there is only one deadline that actually exists. it's in adopted document, the water quality control plan by the state water resources control board that is sa the standards -- says that the standards need to be implemented by the end of, i believe, 2022, as the result of water rights process, or water quality actions. so knowing the pace of which those kinds of processes take, the state, i think, is very unlikely to -- even if they started right now, it would be unlikely to make those deadlines. so i think there is going to be -- and people are going to miss not just, you know, administratively volunteered to date, but an adopted date by the

state that they're going to run up against. i don't know how people will deal with that. we continue to want to participate. we're making ourselves available to talk to any and everybody we can about what we proposed and what we think will work. and see if we can improve lines of communication. michael cart has been doing a good job on that. but the state as a whole doesn't seem to be ready to move forward on this. >> commissioner vietor: short of the voluntary agreement, isn't there a date because of the state order that passed over a year ago that needs to be in compliance, some date where they can start releasing the 40%? >> that is the 2022 date, but that requires them to take implementation step to make those things go into effect. the line for actually processing

those, you know, people have talked about, they could use their authority to provide water quality certification for federal licenses or permits, such as the ferk license. there needs to be a ferk license for them to take that action on and that doesn't seem to be happening anytime soon. so it was what appeared to be a not ambitious date, but as time goes by, that is overly ambitious based on where people are right now. >> the state got itself into a box on that end of things. >> president caen: any other comments? thank you. any public comment? on the bay delta update. mr. kelly. >> next item is update on pg&e

bankruptcy and acquisition offer. barbara hill. >> so the last time we briefed you on the bankruptcy and city acquisition offer was december 10, so there is a bit to report. i reported at that time that pg&e had reached $13.5 billion settlement with wildfire victims. that covered the 2017-18 claims, including the camp and tub fire. and also the ghost ship fire and some others. it sets a company on the fund that -- cap on the funds that would be available for fire claims, except for the kincade fire. the settlement did not include local and federal government claims associated with fire. you may have seen recent articles on that, that occurred

with fema communicating their dissatisfaction. on december 13, governor newsom provided his views on that draft amended plan that incorporated the $13.5 billion settlement and whether it complies with the ab1054 requirements. those requirements were to ensure fair treatment of victims and employees with prepetitioned wildfire claims being satisfied. ab1054 also spoke to continuing climate change progress in a restructured pg&e being neutral on average to ratepayers, and that any restructuring of pg&e coming out of bankruptcy would need to position the company for safe, affordable and reliable service. so governor newsom in his december 13th letter concluded

that pg&e's draft amended plan -- i'm quoting, falls woefully short of the requirements of ab1054. governor said that the resolution of bankruptcy must "radically -- sorry yield a radically structure and transformed utility that is accountable. that the amended plan leaves the company with limited ability, with limited tools to make billions of dollars in safety investments and relies on expensive and short-term bridge financing. all that contributes to a reorganized company that will not be positioned to provide safe, reliable and affordable service. that was the governor's response to pg&e's settlement. and whether it, combined with the whole plan pg&e had, would be in compliance with ab1054 in

his view. pg&e has not responded publicly to the governor's letter. in mid december, the bankruptcy judge accepted that settlement -- those settlement terms as part of pg&e's draft plan. today, pg&e asked that a status conference before the bankruptcy judge that was scheduled for today on its plan, be postponed. they said that constructive discussions -- that's another quote from pg&e -- are taking place among the various parties. so pg&e's efforts to get a financeable plan that will comply with the state's requirements, so that it may emerge from bankruptcy by june 30th continues to evolve. they're still trying. haven't gotten there it sounds like. because of the settlement, the claim cases that were active and getting ready to gear up, are not going forward. they've been mooted by the

settlement. and another area i wanted to report on was the california puc and other regulatory things that are going on. at the last session, i reported that there was a proposed decision from the california public utilities commission that would address pg&e's request for changes in their cost of capital to increase the cost of capital putting in an at or given wildfire risks. the proposed decision by the alg denied that request and since december 10, the california puc did adopt that decision. so pg&e's request for a higher return on equity, because of wildfire risks, was rejected. the california puc has also continued to invest -- its investigation on the bankruptcy plan. that is really where this question of pg&e's bankrupt plan compliance with ab1054 will

happen. so we're evaluating how we can participate in that proceeding constructively. mostly to address ratepayer impacts and safe and affordable service going forward. of course, we see our acquisition of pg&e's assets as a solution for that for san francisco. i want to make sure that our perspectives are reflected in that proceeding as they deliberate. and then two last items on the legislative front, our securitization bill was introduced by senator wiener. it's been given senate bill number 804. you'll hear us reporting on that going forward. this allows local public power agencies to qualify bonds for more favorable credit rating and to reduce the debt service coverage required by investors for bonds used for electric infrastructure. we would be -- to accomplish that, we would be placing a

surcharge on the bill to recover the borrowed funds ahead of other costs. water, wastewater, public agencies, have this authority already. power public agencies don't. the utilities have this authority. so we're asking -- it's sort of a #metoo, we'd like the same authority these other local agencies have to invest cost efficiently in infrastructure. in terms of how we would use it, we would be able to make our power systems more resilient, safer, cleaner, by financing infrastructure like, rerenewable, storage, combination of those two. or improvements to distribution systems. so we have all four of the california delegation sponsoring

this piece of legislation that senator wiener introduced. and then on the internal front -- >> commissioner vietor: can i ask a question about the 804? >> correct. sb804. >> commissioner vietor: and so that would put -- that would add -- that would be added onto the cleanpowersf bill, correct? >> or the hetch hetchy customer bill. to the extent we were using this financing mechanism, if the law passes and we use this mechanism, we would have a separate surcharge on the bill that repays those bonds. >> so to the customer, would that be increased price to what they would be paying to they were with pg&e? >> so the bottom line perspective would be, we wouldn't intend to make investments if we thought it was going to increase the overall cost of the electric bill, right? so we would be using borrowing

instead of expensing to fund these efforts. and we would, of course, come back to the commission and the board of supervisors to do any revenue bond financing using this mechanism. so the specifics of the case could be evaluated and we could demonstrate how it's good for consumers. >> commissioner vietor: but the bill, the price would not go up on the customer side, because we would adjust internally, readjust? >> correct. and how we do our financial planning. yes. on the internal front, we're continuing to work on a refresh of our 2015 business plan. we're responding to commissioner moran's questions about the governance structure. those were asked at the last meeting. and working on indicative credit rating still. with that, i'm happy to take any further questions you may have.

thank you. >> president caen: thank you very much. any public comment on this report? >> that concludes my report. >> president caen: next item. >> item 7, update regarding wildfire risk reduction in the sfpuc's bay air watersheds. >> thank you, commissioners. steve ritchie, assistant general manager or water. this item came up as we were discussing the wildfire mitigation plan back in december which talked about the risk of our electric facilities causing a fire. but the question about the broader issue of what about wildfire that could occur in our bay area watersheds? so asking tim ramirez, the division manager for the natural resources and lands management division to make a presentation about how we deal with that.

>> thank you, steve. division manager of natural resources and land management system. slides, please. i'm going to quickly provide an overview of what we do regularly every day as part of our work to minimize wildfire risk on the watersheds and property we own. then i'll be happy to answer questions when we get to the end. let me start by providing context about all of the things we do in the watershed as i think the commission well knows, we have commission adopted and documents to manage both of the areas that we own and feed, both the peninsula watershed and the alameda watershed. we're a giant landowner. we own a lot of property. we own about 23,000 acres on the peninsula in san matteo county and 30,000 acres in the east

bay. those two areas combined are twice as big as the city and county of san francisco. so we're out there every day responsible for management of the property, including minimizing wildfire risk. the plans have a primary goal of maintaining water quality. this is a cartoon that came out. we use this to remind people about our goal for the watershed. i think folks who were there, if you weren't, we were worried about water quality during the fire. the grand scheme of things, that wasn't our biggest problem, but this cartoon illustrated the risk that we have. one of the secondary goals on the watershed is to preserve and enhance resources. this is another cartoon. you may recall the first time the city and county applied for disaster relief to the state and the state applied to the federal government. the state didn't have enough

damage to qualify for assistance under federal rules. that's because the only thing that burned was a forest. a lot of things burned as well, but there weren't homes that they could quantify economically. so we did work with groups then and the state to try a better estimate the real risk. we couldn't use those in a federal context, but we demonstrated there were about $700 million of other losses associated with the fire, just within the perimeter that dealt with the ecological loss of the forest. eventually, the city and the state qualified for federal assistance. very quickly on the watersheds. i'm going to cover general programs and give you a quick tour on the peninsula and the aimmediata side. there is state responsibility areas. we don't fight fires. we don't have fire crews on the watershed that run out there when there is a fire.

people come and help us. it's the state's job to do that. we have cal fire on our property. each of the counties we work with have fire safe councils set up and community wildfire protection plans. these are things that all of the counties in the state have that provide context for people to work together to address risk on the front end. what we do annually, we have liaison meetings with the first responders, including cal fire. last year we basically co-hosted the workshops with cal fire. the one workshop was on the property. we came back to the yard. on the peninsula, we have it, that's the water temple. we invite all the folks to come for the day to meet before fire season starts to make sure we know who we are, introduce the new faces, make sure we have communications set up. so when we go out in an event we don't meet for the first time. we have fires every year on both

watersheds. we want to make sure we're ready when things happen. we practiced the whole group, what happens during a fire. fire happens here, what do you do? who do you call? can you call them? do your radios communicate? do you have the similar frequency? what about dispatch? also on the watershed, we have fuel breaks and fire breaks. you heard a lot about our power lines. the commissioners adopted the fire mitigation plan. i won't talk about the annual power line maintenance, but that happens. we have a tree crew in the puc that are responsible for doing the bulk of that work. you'll see examples of that in a minute. red flag days, we have our own threshold for humidity, temperature and wind. based on those thresholds, we tell people whether or not it's safe to be on the watershed to

work. whether we have restrictions on the work or whether we close the watersheds. we closed the watersheds last year, i think we had four days in a row that were red flag days. we've never had four total at my time in the puc. we had four in a row last year. the best thing we can do is tell people not to work to minimize risk. we do that on rare occasions. we have our plans that we work through with the puc and annually make sure that all the folks in the puc have the information as well. we reach out to the other groups, water enterprise and folks working on the property to make sure they have the same information. this is just a map of that from the document that was presented earlier that the commission adopted. this is part of our portfolio. you can see the watersheds

there. the peninsula is in the darker color. the tier one colorer with the higher risk and alameda is tier two. peninsula watershed. about 22,000 acres. it is such a fire hazard that the state decided to list it that way in designations. just to elevate the concern that the state has about this area. we have 112 miles of road. 25 are paved. i mention the roads because one of the main things we do for people is access. can they get to there from here and how do we do that? we make sure we have keys and maps of the watershed, so they can be where they need to be and protect people around us. we have 90 miles of the fuel breaks as well. every year, we're mowing and disking and vegetation work to

buffer the communities around us. we're active members of the san matteo fire council and san cruz and. this is one of the signs we have on all of the gates to remind people as they go in about the risk. hazardous fire area. this is an example of some hazardous tree work being done by the tree crew. this is taken from the bucket truck, so they're looking down on the road, where they're taking some of the trees that are either dying from disease or from drought or age. and we don't want them to fall on people while on the road so we take them down in advance. and there is the bucket truck. roadside mowing is also very important. a lot of ways that the fires start are the public roads through the watersheds, the state highways or the county roads. we have our own risk with our

own vehicles, and we mow the sides of the roads to minimize that risk. we don't want to start a fire by having our vehicles off on the grass. this is a quick example of cal fire working with our crews in the field. i think also folks know we do controlled burns when we can on the peninsula watershed on the dam faces. we get two winds here. we have to produce the destandard to inspect the dam. we're going to mow it or burn it. we can burn in the spring. it's an exercise with cal fire and us. this year we were able to do it again. this is san andreas and the smoke after. this is really exercise for us, and for cal fire. one more shot of an andreas.

i wanted to show the map. i wanted to let folks know, one of the things we do for watersheds, we make sure that everyone has these maps. these are maps that show the roads, the gates, the water sources, the heli-spots, if we need to land a helicopter. we want to make sure all information is at their finger tips. our staff have it as well, so we can refer to the same location to make sure we're working from the same script. another thing we're doing for lots of reasons is historical ecology work object the -- on the watershed. i wanted to demonstrate some of the change here and why the peninsula is the high hazard fire risk area. it's the vegetation change. on the left side, you can see a picture from 1900, same location

looking across. on the left in black and white, you see looking east, no trees. and we're obviously littered with trees now for various reasons. thinks one of the problems that happened when spring valley bought the property and we bought it from them. it was managed to avoid fire all together. we did. as a consequence things grew and people planted things. people planted things when spring valley purchased the property. all of those things evolved and we continue to have greater risk because of that. this is looking on the peninsula watershed, looking down stream. just example of the change in vegetation. then one more looking north over crystal springs. you'll hear about the work later when we get it done. the report is almost ready to be released to the public. we haven't seen it yet. they do a great job up and down

california. it's a really useful document for things we do on a regular basis. i also wanted to mention quickly, how we balance this risk with access. one of the things that we'll talk about when our ceqa document comes out is the risk associated with having people on the property and fire. the regulations we set up about management and public abscess -- access on the trails is driven by the fire risk and we minimize that and other risks on the property. just a few quick slides. a bigger area. state responsibility area. equal number of roads. less paved. the fire safe council over there has a community protection plan. recently was amended to incorporate some issues for the

town to make sure we were providing resources to them in the event of a large fire. this is really great example of why we do disking on the watershed. this is a highway fire that started and moved its way to our fence. and then on the left side of the fence, the area was just recently disked. you can see the fire at the far end and the fire stopped. it stopped because there is no fuel. this is exactly why we disk. >> what the term? disk? >> disk. it's a tractor. it's carrying the disk behind is rotating and breaking the grass up and leaving mostly dirt. we mow in the peninsula, disk on the east bay. >> why? >> vegetation types are different. there is lot more mowing. up against the edges of the community, especially on the east side of the watershed, we disk up there.

it's harder, if you have dry conditions. we generate dust as well. we want to be mind. ful -- mindful of the risk we're creating and not create another risk. great question. this is the last slide i think. this is the meeting we had at our new shop space when we opened in the spring. this is the cal fire local chief on the right. the watershed manager in the middle and the sheriff who is there. and they're walking through the tabletop exercise in the spring. we did a great job this year with cal fire. i asked our folks to step it up because of the attention and the risk we have that you're all aware of in california. and our folks delivered this year. we did a much better job and we'll do it again this year. that's it. i'd be happy to answer questions. thank you for your time.

>> >> commissioner vietor: what are we think being with the south bay? and knowing that it's because of the vegetation? are we considering an education plan? considering taking out vegetation? what are the ultimate goals? i know it's difficult to remove a tree, but what are we thinking in >> everything we can all the time. we do the work we can with the first responders because we know we're going to have fires. we want to be ready. but we like to avoid fires as much as possible by minimizing the fuel-loading. so we have started to do more work like that in the watershed where we can. a couple of different ways. the mitigation projects that we've been doing because of the improvement program on the watershed, really fit well with the standing to reduce fuel-loading because we've been able to clear the areas that are mostly trees and restore

ecological species, flowers mostly. when we do that, we're reducing the fuel-load along the edges of the watershed. probably about 1200 acres of the 2000 acres have been things like that. a lot of tree removal. that's combined our interest and to get the work done. we're also working with cal fire right now. there are areas in the state last year the governor directed to get vegetation out to protect communities. we didn't get that direction here on our watersheds, but cal fire did get money. they got money to do environmental review. so just like the pacific burns on the dam, we're working with cal fire to lead the ceqa document to do prescribed burns on the watershed. very small. but it's a place to start. it would allow us to take some of the load away. it would give cal fire a chance to practice.

and really a great way to do more work like that on both of the watersheds. we're hope doing one or two this year on the peninsula. >> do we have an ultimate goal of how much load we think is acceptable or not acceptable? >> no. i think we'll always have risk because the watershed by design and by every possible way are mandated to be open spaces and protected to provide source water quality and protect ecological resources. we need vegetation. we don't need all the trees, but we need some. we haven't done the math about where we are now to look at the gap where we want to be and where we are. probably because i don't sleep very well in the fire season. and i wouldn't sleep at all if i knew the gap. it's a large number. we haven't done that work yet. >> we're not talking about getting rid of all of the trees, but what would be the amount that we could handle? since at one point there weren't

any trees? >> there were some trees. and we haven't -- this is part of the work comes in handy. there were things happening to affect the landscape, but it's a much better sense of what was there than what we have now. we like to ask questions. where do we want to be? and how can we combine interests? the grassland habitats are limited in san matteo county and that's a great way to get the work done and declare some of these areas. trees for no particular reason, but planted by a homesteader before they purchased the property. as a consequence, they had further disrupted the processes. so part of the strategy was take the trees away. hopefully, more of that work

will happen. >> thank you. >> very informative. thank you. any public comment? next item. item 8 is new commission business. >> president caen: commissioners? new business? seeing none, the next item. >> item 9 is consent calendar, all matters listed constitute consent calendar are considered to be are you teen by the san francisco public utilities commission and acted upon by a single vote. there will be no separate discussion of the items unless the member of the commission or the public requests. in which event will be removed and considered as a separate item. >> commissioners, any item on the calendar you would like to remove? to the general public, any item you would like to remove?

may have a motion? >> so moved. >> second. >> president caen: all those in favor? the motion carries. next item. adopt a resolution authorizing the general manager to execute a second amendment to the employment contract with kathryn how to extend the term of the contract by two years to january 2022 to provide a 2% base wage increase and update contract terms. >> so this is something that i have been working with kathy how as you may or may not know. her contract has expired. and she is eligible for retirement real soon. i convinced her to stay, trying to get her to retire when i

retire, but i'm still working on that. but this contract -- [laughter] extends the time. and then also, it ties with the 2% increase that local 21 received when they were in negotiations. so we put that in because most of her people who work under her are local 21. so that we put that in there as well. and so with that, i would love for you to approve this contract so kathy can remain agm and help me address all the capital projects that we have. >> i have a question. good work if you can keep her and good luck to all of us and good benefits to all of us. my question, you said 2%? >> yes. it was 2% on top of what --

because currently she's represented by mea. and the local 21 got a 2% on the engineering. they have an additional 2%. >> so that was a side letter to the master agreement. >> well, it was part of the master agreement. other disciplines didn't like it, but the engineers received 2% on top of that. because of the parity issue. >> thanks for the clarification. >> president caen: any other comments? >> i'd like to move the item, but with bit of a caveat to say, you know, we really appreciate your work and hopefully you'll continue on for two years, but not tie yourself to the retirement of our general manager, but potentially consider carrying on after that time if it serves you and the puc. so i'd like to move the item.

>> second. >> can we put that in writing? [laughter]. >> president caen: i forgot to ask for public dment. -- comment. seeing none, i call for the question. all those in favor? opposed? the motion carries. i agree with you. felt like we were being undermined here on the commission. everybody is leaving. so, next item. >> item 11, approve the selection of hdr engineering and aecom technical services or agreements and authorize the general manager to negotiate and execute two professional service agreements, each in amount not to exceed $11 million with the duration of 11 years, subject to board of supervisors approval. >> good afternoon, commissioners. kathy how, assistant general manager for infrastructure. thank you for approving the previous item.

thank you for your comments. this item is to -- we went through an r.f.p. process to hire three consultants to help us with dam assessments and proposed improvements that may be needed. and in that process, we did receive one protest. and that protest was against gei, so we're not asking to award a contract to gei at this time, but the other two firms that were ranked in the top, hdr and aecom, those did not receive any protests, so we're asking to award contracts to each of those firms so that we can begin work with them. >> what was the protest? >> actually, it involved our previous water capital program director, dan wade. dan wade joined gei and so

stantec protested that gei had an unfair advantage. >> hmm. so what is happening? >> we will probably come back to the commission at a later meeting and ask for award to either gei or gerald stanley -- stantec. >> how many dams and reservoirs would this entail? >> we probably have listed most of our dams and reservoirs. steve ritchie, agm, will speak to the dams and reservoirs 15-year program he's got laid out. and so these contracts would be in support of water enterprise trying to meet dsod requirements which they may be changing. >> i see.

>> i would assume that involves the inspection of -- >> it definitely involves inspection. and it's a pretty broad scope. and it does cover quite a few of our dams and reservoirs. even in city. >> other questions, discussion. >> i'll move the item? >> second. >> all those in favor? darn it. i was going for a perfect record today. any public comment on this item? all those in favor? opposed? the motion carries. thank you. next item. item 12, approve the plans and specifications and award contract wd2739 in the amount of 14,919,291 with a duration of 730 contech calendar days to be responsible bidder submitting

the lowest responsive bid, cratus. >> this item is pretty straightforward. we're requesting award to the lowest bidder for the joint project we're doing with public works. >> i'd like to move the item. >> second. >> president caen: any public comment on this item? all those in favor? opposed? motion carried. next item. >> item 13, approve the plans and specifications and award contract number ww687 in the amount of 5,986,22 with the duration of 630 consecutive calendar days with the lowest bidder, anvil builders and approve the conditions and permit hudson one ferry

operating, allowing sfpuc to enter and use sea wall 351. >> good afternoon. director of wastewater capital programs. i was introduced to the commission. i would like to introduce bessie toms, the project senior manager looking after this project to cover this item. >> good afternoon. i'm bessie tam, project manager. this is a straightforward agenda items. we're seeking approval to authorize their general manager to enter a permit to enter into this parking lot so that we can construct the project. the area is absolutely in order for the project to proceed. i'll take any questions. >> i'll move the item.

>> president caen: public comment on the item? all those in favor? i'm sorry. didn't see you. >> it would be nice when we have a project like this linked to the force main to not only state this project is very important, we know it's very important, but we like to know what exactly is going to happen to all the flooding that took place, say, with the institution on embarcadero and so on and so forth. our force main, and there are other force mains that i know have been compromised before by not taking the necessary precaution. one of them being near marine

street. band-aid operation. where three conduits were dug and it's all connected. or what goes into the treatment plant. but this is how we got to do it. the people at home have to understand, we're spending millions of dollars on a force main, what are really the benefits? because we do know that our facilities and institutions that are compromised because we need a force main. but we also need to know exactly what locations, what facilities are being helped so we get a clear picture. we have to remember that we have the sfpuc and all those who work

for the sfpuc are paid by the taxpayers. and i see like when i went for the budget thing, trying to create some sort of a thing where you have a people, you have to study what is chief of people. we're no longer leaving in the feudal ages where the king and such people control the people. taxpayers pay their taxes so they get the required services. and some of them understand that. the older generation. the younger generation believe in consultants. consultants come and go and that may be appropriate for certain things, but we shouldn't make that the norm. thank you very much. >> president caen: thank you. any other public comments?

i'll call for the question. all those in favor? that motion carries. next item. >> item 14, conditionally approve the issuance of up to 3 billion, inclusive of the proposed $2.5 billion acquisition cost and other acquisition-related costs and bond financing costs of power enterprise revenue bonds to acquire certain pacific gas and electric assets subject to future satisfaction of six specified conditions. >> commissioners, eric sandler, c.f.o. as you know, we're pursuing the acquisition of pg&e assets within the city. in september, the mayor and the

city attorney submitted an indication of interest to pg&e. the purpose of this resolution and a similar one before the board of supervisors today, later today, is to demonstrate the willingness of the city to finance this potential acquisition through the issuance of power revenue bonds. this resolution approves the -- is a conditional approval of the issuance of revenue bonds specific to the preconditions being met. including the successful negotiation of any acquisition, findings that it's beneficial to the city and ratepayers. that there is a complete ceqa process. that there is authorization required in the city charter for the issuance bonds such as the delivery of the pro forma that shows that it meets objectives

as well as ceqa requirements. >> i'd like to move the item. >> second. >> i have everybody working on my side now. public comment? >> so, when i worked for the presidio every year we had to negotiate with pg&e. we didn't have meters. every year we had to negotiate with pg&e. so early on i asked a question to our engineers, why is that so? and they call the wrecker act. the act gave subsidized prizes

to the military. it was a presidio. through the municipalities and to public housing. they got subsidized rates for the electricity. but once the meters were put, then the consultants that were hired by pg&e got a lot of money. and pg&e got a lot of money. that's for you all to analyze and realize what happened. we have had this discussion before. how when the transmission lines are brought from hetch hetchy, they stopped about 30 miles away from san francisco. for pg&e some years ago to bring that electricity to the city and county of san francisco. and take control of it.

now, we know that when it comes to clean water and the wastewater and even now hydroelectricity, that sfpuc has been lacking in some of those departments. and we should have taken a lead in having solar 25 years ago because they've got a lot of land. millions of acres of land. somebody was asking, how many -- what is the price they put on our land. we've got millions of acres of land which we haven't utilized. and which we could have utilized. so now with pg&e after the fires and all the bankruptcy, the governor is saying one thing, somebody else is saying another thing. the people are not getting paid who were the victims of the fire. and here we have our mayor, today i just came from the other meeting, she said -- [bell ringing] -- we're heading toward

$500 million deficit and here we have sfpuc saying, okay, we'll have a bond for $3.5 billion. who is fooling whom? again, it's the taxpayers' money. we need to have a hearing. a nice hearing. with everything laid out clearly, demarcated so that we can understand where what is happening. thank you very much. >> president caen: thank you. so we have a motion and second. >> i have a comment if i could, through the chair. >> i was under the impression, one, that this was a supervisor and mayor-driven piece when it comes to the finances. and moving things forward. i'm going to vote yes because i know this is the board of supervisors, this is a preliminary vote, and the details aren't all in.

this isn't fully cooked, fully baked or even accepted. so i'm going to conditionally vote yes, but because of issues i've brought up previously, about how this is going to play out in terms of the city, in terms of actual ways this work and how it gets done and how workers are taken care of, and assuming pg&e actually acquiesces to accepting the offer, there is still many questions i have. but there is a certain political unity that i want to be part of, but i'm going to be reluctant yes on this. i wanted to telegraph that for the record. >> president caen: okay. any other comments? i'll call for the question. all those in favor? opposed? the motion carries. next item. >> item 15. retroactively authorize the assistant general manager to apply for california climate

investments fire protection grant from the department of forestry and fire protection in the amount of 366,881 and general rise the general manager to accept and expend the grant if awarded. >> i'd to move the item. >> president caen: public comment on the item? all those in favor? opposed? motion carries. next item. >> item 16, approve the water supply assessment for the proposed one vassar project. >> steve ritchie, assistant general manager for water. you out waited me. this is another water supply assessment as we've been through a number of these over the years. we went through a large number in the middle of last year.

we have this one and another one, but i don't see too many more on the horizon. where, again, this is a report that is required to be done to give to the planning department, so that they can use in their ceqa process for examination of the project. and as in the other cases, we've identified that the bay delta water quality control program is a potential issue, so there are three scenarios that could play out. and looking at all of those, we believe that this project can be served, water, if that is the choice of the planning commission in terms of the ceqa process. this is not an approval of the project, but legally required report we need to make for this and other projects. >> president caen: correct. we've discussed this before. any additional discussion? public comment on this item? may have a motion?

>> i'll move approval. >> second. >> president caen: all those in favor? opposed? the motion carries. next item, please. >> item 17, approve the termed on conditions of authorize the general manage tory execute a no-fee, five-year license to replace an existing license with tuolumne county for operating and maintenance of radio towers and four existing repeaters throughout tuolumne and cal vary as counties. >> good afternoon. i'm here in case you have questions. >> president caen: any questions? >> i'll move the item. >> second. >> president caen: is there public comment on the item? all those in favor? >> opposed? the motion carries.

>> thank you. >> >> president caen: madame secretary, please read the items for closed session. >> item 20 is existing litigation, pacific gas and electric corporation. item 21, existing litigation, it city and county of san francisco versus electric gas. item 22, city and count san francisco versus pacific gas. >> president caen: may i have a motion to assert? >> did we call for public comment on matters to be discussed in closed session? >> i was going to next. >> move to assert. >> second. >> president caen: public comment on this? all those in favor?

opposed? the motion carries. we will now we're back. >> the commission has reconvened in open session. may i have a motion regarding whether to disclose discussions? >> moved. >> president caen: any public comment? very good. all those in favor? opposed? the motion carries. this meeting is adjourned at 3:32 p.m.

>> good morning, everyone. the meeting will come to order. welcome to the thursday, january 16, meeting of the government audit and oversight committee. i'm gordon mar, the chair of the committee and joined by supervisor aaron peskin and