local hiring requirement. the contract mine division has the local business enterprise r o b requirements and we it is with their help and then the resources of the agency and with the workforce training program services division that we're able to achieve. i think some of the outcomes that we're going to show you today. so before i get into the data, let me just say that all of this data is from the end of the calendar year 2024. so it's through december 31st, 2024 and we're going to start by focusing on the sewer system improvement program overall and not because it's anything special but it is the single largest part of the agency's overall capital plan and it is we have the best historical data on it. >> so the first slide that we're focused on we're focused on workers and individuals, right? and this aligns to the the city's local hiring requirements and the project labor agreement that we administer. so what you'll see is that the history of the of the sewer system improvement program goes

back to a time when local hiring actually applied at a 20% rate. so depending on the time of the contract was advertised there was different contractor requirements and over time it has risen to 30 percent even though even against that requirement the agency has overall at a 34% requirement. so even when we were at 20% we're still able able to achieve a number closer to 30, 30 or 40% and also on the entry level sort of newest workers apprentices there's a requirement for a 50% utilization of local local resident apprentices and the agency is at 57% and this is overall on the the program as a whole and what that means is that $110 million in wages and benefits have been earned by san francisco residents and that money has gone back into the local economy and been spent and recycled in san francisco. and i think those are outcomes

that the agency is trying to achieve striving to ensure that there's economic participation from local residents and also that that money keeps going through the city's economy. i'm going to switch over to liz and this is again now we're transitioning away from individuals and workers and we're focusing on small businesses. what you'll see on this slide is that over the term of the program set up we have awarded 312 different hlb ees over 950 contracts worth more than $862 million. so the on the sis of program overall we've gotten close to $1 billion in awards to local businesses right which is again a significant impact of dollars saying in the san francisco economy and being recycled here this slide is just a quick kind of overview of some of that similar data but on individual projects and on projects that are the largest projects at the agency.

the things i want to draw your attention to on this slide are first around the mountain tunnel project which is at the bottom the local hire numbers are going to jump off the page at you a little bit there. they're higher than everything else that's on the page mostly that's a reflection of the fact that this is a project that's in the region and shows the agency's regional impact and the fact that residents of the areas where that project is happening are also able to participate in the project. right, which is i think the again that effort at economic opportunity and inclusion. i secondly would like to call your attention to just the scale of the achievement. so on biosolids you're seeing that roughly 100 and i'm sorry 1.8 million hours worked which means that at a 33% local hiring participation roughly 600,000 hours of work by san francisco residents which is a lot of people and a lot of hours. and then finally i would call your attention to sort of a thing that's on the slide that i wasn't i don't want to love

but it's on there which is that under head works the apprentice participation requirement is currently below the the requirement and i want to acknowledge that and say also that our data is raw. it is not including the pipeline and compliance mechanisms that has to do offsets and off ramps around local workers. and so over time what we what we what we have learned is that that number will go up based on all of these final calculations of the local hiring requirement. and in fact there's a meeting next week to begin those efforts to address the local hiring requirements around apprentices on on metrics and then i will shift over to the small business side of this slide. and again i think i would mostly just want to call out the scale of the impacts right ? biosolids alone is roughly $400 million in awards to ease and then head works has another 105 million. right. so you're talking about half $1 billion in awards. lba is in those two projects

alone and i think the agency has done a lot of work in holding contractors accountable to achieve those outcomes and has made sure that the work of the agency in these projects really results in these outcomes. and i think one example of the way that we've done that is that we have added an additional layer to our contractor requirements. so i said that there are legal requirements, there's laws right that the contract division and and i would apply we added a contracting requirement that we call local participation and that is basically a requirement that the contractor on the project the prime contractor assess the work of the project whether that's the the the work that a contractor would perform or an individual would perform figure out the schedule and the sort of scale of that work and then figure out the market for local businesses and workers and then align those two things. right? so what is what's the work of it? when will it happen? how big is it and then who can perform it and then when they align those things to the extent that there is not

alignment to the things that there's gaps the contractors then obligated to develop a plan and implement a plan to to either train up or support the contractors and the workers so that they are able to maximize utilization on the projects. and one of the first of that we did this on was the southeast community facility project which is at 1550. evans and what you see here on the slide is that the results were a success. we exceeded the local and hiring requirement by about a third at 39% we exceeded the apprentice requirements by about a fifth at 62%. importantly within those numbers is actually numbers for residents of district ten so about 35% of the overall san francisco resident hours were worked by residents of district ten which means that the workers that were working on the project are from the place the work has happened right? most importantly it's just right down the block. additionally the final lbb participation on the project

was 31% against a requirement of 20% so again exceeding the requirement by about a third and resulting in about $26.5 million being awarded to lp during the term of the contract . >> and i think what the real opportunities though with local participation and this sort of additional layer that we've added is that this works best on alternative delivery or collaborative delivery model contracts. >> those for the commission are projects that you would have heard as a construction manager and general contractor contracts sometimes they're called cmg sees design build contracts and the truth is the agency as a whole is moving towards that delivery model and so there will be opportunities to apply the same contracting requirement on additional projects going forward. >> and then i would like to transition over from data to kind of a human story and this is a story about deja wilson who is a san francisco native native of the bayview and when

she was ready to start a career she had godparent that were in the trades and they introduced her to the idea of working in construction and it was through her godparents and the trades in that work with the unions that she was introduced to programs and products and opportunities that the puc runs to reduce barriers for local workers to get on puc projects to try to help them land on and find work on policy projects. and it was through that work that she was able to land on a piece see project appeal covered project and over time she actually became an employee of the san francisco public utilities commission so she transitioned from being a worker on our projects as an outside employee and actually now she works for the puc and she also was so inspired by her opportunities on puc projects in safety roles that she went back and got a bachelor's degree in occupational health and safety as a way of sort of you know, really chasing her her interest. and so i think not that everybody results in this

outcome but i think these are the possibilities when you put resources into local workers and local businesses and i hope that my story about an individual person transitions well to wendy story about human resources, thank you very much . thank you so much ben. i'm wendy mason, the chief people officer and with me i've got some members of our talent team melissa white, janina villanueva, older fighter who you'll hear from in a moment and david perez actually out there recruiting in the field but he will join us soon as he's done so recently. in the past year hrc has really made a concerted effort to increase our engagement in the san francisco community and reaching out in particular to local universities and community colleges to enhance our pipelines. >> we also are announcing a community strong career fair in april which is going to be held at our southeast community center facilities in the

bayview to further reach out to our community members. we've attended over 15 career fairs to engage a wide variety of candidates from local colleges and universities and in addition to our in-person engagement outreach we've been using data driven recruitment strategies to improve our outreach effectiveness, particularly on platforms like linkedin, sfr careers. we've launched the smart recruiters talent community to build stronger relationships with our prospective job seekers through personalized engagement campaigns. that is a picture of an in-person event we had where we engage with candidates to let them know about our opportunities. >> as i mentioned, we're really excited about our career fair it's a wonderful opportunity to utilize our southeast community center and we're also trying to do some innovative hiring such as trying to experiment with some same day hiring techniques on a pilot basis. so we know that there's you

know, some issues going on right now in the city with hiring, but this is exactly the right time for us to be experimental and to try new strategies to increase our talent pipeline. we've really learned that our talent pipeline is most robust when we actually personally go out and engage with our academic institutions and community based organizations to work with us to identify prospective candidates. so with that i'd like to invite allude to come up because he's one of the people who's actually out in the field quite a bit to talk a little bit about some of the engagements that we've done. thank you wendy. good afternoon commissioners. my name is vincent ohlmeyer, coo phat and hippo global olu for short and i'm actually a san francisco native. i grew up in the western addition and also the bayview and it's a complete honor to be here today as a 1250 recruiter

for the sfp. see we focus on essentially revitalizing the way that we go about recruiting, right? i think that the status quo with the city and especially p c is that we're a little bit behind when it comes to getting hired or my application wasn't viewed etc. right. but there's a piece missing where we are trying to communicate with the individuals that are applying that there's a successful way and there is a journey along the process where you can build skills and also match what we call the minimum qualifications when we're moving forward in the pipeline. so we've engaged with local community colleges like city college skyline and then the universities as far as s.f. state along with uc berkeley where we just did a information session for students that are you know, coming out into the job force and seeking employment especially with the city and county because we still do have a great reputation and it's it's very

it's a very good experience to be in front of those individuals when we talk about being employed by the sfp you see and being a native here because i know the gap for me and my community if i can just be honest with you is the resources and the information and a lot of people also fall in that gap as well in addition to that we have something that's really important to me. i mean leaning back in to my i guess general experience growing up in the west in addition and the bayview my parents were immigrants from nigeria okay so resources were slim. even information being passed down was slim. so the way that i found out about the hbcu and just improving myself taking myself from aspects of the community that helped me back was through

community work, right? so as a recruiter, as a p.s. my heart is to align with individuals and meet them where they are, right? i think that's very important. >> so through the ymca i found out and went on a college tour that was completely paid by the ymca to go to howard university. >> right. and this aspect of partnering with deepa on i guess an initiative to to bring forward a certain level of diversity, right? especially in the climate that we are now was awesome. >> so essentially we hosted two interns for the entire summer marlo along with caitlin and essentially we gave them a rubric on how to crash course or become professional after your senior year of college, right? this was something that was near and dear to my heart. as you can see the picture there i'm actually wearing my letterman jacket well along with marlo there at the table

there at the p c at the spiro. but it's a complete honor and it is absolutely a mission of ours to make sure that the next level of recruiting when we're tying it into the community aspect of things is at the level where individuals can move forward and you know, have a successful matriculation and through our process and our pipelines appreciate it. thank you so much and we like ben wanted to to end it on a personal story. so at this point mr. poole and mr. nepo and i are available to answer any questions you might have. >> thank you so much for that presentation. boy, there's a lot going on. commissioner's questions comments commissioner levy roni thank you very much. it was very enlightening and great work that the you see and congratulations on being at

howard great university when we say local is it local san francisco or san mateo or like you mentioned up in the mountain tunnel that yes you referring to my my position yeah okay sorry so so that we try to how far it is local i guess just defining it so it's defined differently on different projects so broadly on up it is defined as just residents of san francisco but on any project that exists outside of san francisco then we start to incorporate additional regional boundaries. but in mountain tunnel it basically incorporates the entire service territory. so there's a series of zip codes that apply throughout our service territory where we have operations pipelines, whatever and folks that live in those areas and then eligible to be considered local for a project. so that's why mountain tunnels numbers are kind of skewed.

>> yeah. and then and then as you define for the commissioner hyper local. sure. and then there's a term that gets used and that's hyper local largely those are folks that are expressly from the bayview and really what i think that they would even say they mean by that is folks that are that are from the bayview and have been in the baby for a long time not that are newcomers or different users and i think the definition of hyper local comes from the local hiring ordinance that refers to disadvantage workers as a sub percentage of the local hiring requirements. >> and do we know is this throughout the city contracts or is it just specific to the sfp you see this program so i don't want to wing that answer and i would i'm happy to get back to you control over i'm going to be fine but i would if i can answer like very quickly high level knowing recent annual reports that we've gotten from the office of

economic workforce of amount around our outcomes as a general rule we are achieving at the highest or right about the highest percentage in the city and even if we're not the highest we're usually at scale way more than anybody else is doing. so i think the last report we were in the we were north of 45% and at like 1.6 million hours i want to say and like the only agency that was higher than us had like a third of those hours and i can document those numbers but i feel pretty pretty good about i can i can certainly forward you that report if that would be helpful . >> very good. thank you very much, commissioner janda thank you president stacey and my questions also for mr. bloom so i'm really impressed to see the numbers for the mountain top. >> i think you define local kind of explains that really really great to see all these numbers and very interested in this. i have a very big question which is you say when you say resident apprentices so does

that only mean apprentices who are in an apprenticeship program or does that include pre apprentices who are also in the pipeline to be coming up? >> so the answer to your question is this is only apprentices that are registered apprentices indentured to the unions and mostly because the way that we're tracking the data commissioner gender is from the ltv tracker system which is the system the city's software system that tracks prevailing wage payments to individuals. and so that's where we're getting the data and then it's so it's tracking against actual hours worked by folks on the projects and you would you know you're an indentured also that data is tracking against the city's law the local hiring law which again is focusing on apprentices actual indentured apprentices the that to say if you're sort of paying it for pre apprenticeship there are right other opportunities but it's not going to it's not going to show in the that's got it and also when you said in the local participation effort you said you improved on a lot of these statistics because of contractors training up folks. what kind of training took

place? >> could you give us a little bit of a flavor of sure. so on the 15 for the evans project and i want to say that what we have tried to do with each project is really ensure that the contractor understands their obligation to sort of like align those opportunities and address any gaps and that each one of their contracts for each one of the 100 would really have the opportunity to sort of deploy the solutions as they see fit right in the case of the 5050 evans project, what they found the most useful was to identify individual contractors in the case of small businesses that were aligned to components of the work. so painters or plumbers or electricians and then work with their trade partners so the contract prime contractor is mostly going to sub out to like you know large but the specialty contractors and ensuring that those contractors are working with a subset of folks that they've identified and trained up really sort of taught and shown the effort of bidding some of the effort that they would need around paperwork and tracking

in order to successfully deliver the project. and what they did in that case was they sort of identified specific scopes of work that they could separate out that would really allow contractors to sort of like be on their own two feet. but they also did it within the context of a like a trade contractor relationship and then the workers was really just about working with all of the different partners within the bayview and in the city, right? there's office economic workforce development, there's city build, there's the unions, there's the puc, there's the cbos that help and identify folks that are available and then ensuring that those folks in coordination with the unions are being then dispatched to the project commissioner rc thanks president stacey and and thanks ben when the hello and to the general manager for for bringing this presentation thanks especially because i came in about five minutes late

and for your willingness potentially even to hold for for for just a little bit for for me to join because this is of particular interest to myself and i think because it's really impressive to see what you and the team have done with with these policies over the last ten years at this point and in change for folks that may not be aware and in fact jim robinson and i were having this conversation during our tour of mountain town the last week that a lot of the the origin of these policies ben ben knows and folks like jim or to carney because he was there this was really having these policies was part of a conversation i mean going back decades but really when the work of the agency was beginning to shift from the kind of home stretch to the water system improvement project and looking into the

city around the sewer system improvement project really trying to align the opportunities that these important investments were going to make in terms of not just addressing the needs around the digesters in the wastewater treatment plan and the city beneath the city and in the upgrades around the sewer system. but the concentration of a lot of these jobs in contract know opportunities in the southeast you're really seeing a lot of deliberate work by the staff of this agency working with community partners, working with building trade unions, working with contractors both large and small other government agencies. i mean it's really a success story. i'm hoping that we are really able to to tell. i imagine your your your your kind of expertise and that of the agency is set by other water agencies. how you've been able to do more than just make these important investments we create these economic opportunities the multiplier effect the over $100

million of additional wages into the hands of local workers has a multiplier effect especially at a time like this that helps the local businesses, helps families. the fact is having been one of the advocates that was there back in the day, we found that without a mandatory local hiring policy you you don't see the outcomes like what we saw there with respect to 30 to 40% local participation the ranging of apprentices from 50 to 60% plus there what you actually saw without a local hiring policy before the city adopted a mandatory local hiring framework at the end of 2010 to get things going in 2011 was more like 20% on average and as much as no more than 3,536% local apprentices. so you really see what the difference means in terms of delivering those opportunities to local workers and again the

fact that we have a project labor agreement is really, really important because that brings everyone to the table. we've got our building trade partners the puc, the the community partners, all the contractors. i did want to just say to commissioner leave aroney one thing that ben's absolutely right and again in a past life are working with city bill director ken nym i was the city's director workforce development for five and a half years and the last most recent report of the six different agencies that put out contract subject to the city is local hire ordinance. it also now includes affordable housing developments and even private sector developments that are on city land and those as well as those who opt into this framework as a way to deliver guaranteed job opportunities that communities out of 4.2 million hours covered in the most recent report issued in 2024 which covered calendar year 2020 34.

2,000,000 hours total 1.5 were puc projects and while the city averaged 33 local 33% local participation across all those projects the puc averaged 41% on our projects and out of 49% local apprentices citywide the puc averaged 60%. so the agency really continues to lead the way in that regard and i think what we're seeing too is the same holds true with respect to local business enterprise the fact that you're working with wendy in the in the in the h.r. team to also create opportunities for our permanent positions at the agency is even more special and thoughtful. >> i just am really excited to hear all this and see all the great progress. the only thing i would maybe ask is as the age as a commissions ratepayer advocate just want to say something i've said before which is i feel that this success in investing our resources the puc fun fact

the puc is the largest investor in the city build program over at the office of economic and workforce development apart from all the other great programs that you help administer, i think these are ratepayer advocacy tools i think these are things to point back when we talk about rates. these are ways to talk about additive benefits of entrusting your rates and your services with us because we're creating these opportunities that have positive impact for the rate payers and particularly business owners who are looking for opportunities with us. the only question i have is just if if any of us should hear from folks looking for work or local business enterprises looking to contract out with the agency or looking to participate in our different programs that we have to support. how how are those services marketed that we could point to either job seekers or local contractors? >> where would they point them to for these opportunities? sure that's an excellent question. >> thank you for asking that question.

so there's a couple of different resources that we have like printed or online always though for small businesses and i'll be is there's the contract marketing division obviously it's the agency that runs that program and i would always encourage people to do that. we also have the contractors assistance center right which is expressly called out in our presentation and i would encourage people to go down and meet with the staff there for small business for offsite ,for workers generally we refer folks to the city build one stops as a way of finding and sort of clearing them into and making sure that they get like their sort of assessed for the resources that they need and then potentially either submitted to like city build to be a pre apprentice or an entry into the unions and i can if if you allow me i will follow up with like the printed material we have that have those phone numbers and websites and i'll share that for the whole commission. so if you get questions you have those resources. great, thanks. thank you commissioners

and thank you to all staff. this is really important work and it's not easy work all the time either. should we take public comment on these topics? >> remote callers please raise your hand if you wish to provide comment on item five a are there any members of the public present who wish to comment on this item? >> seeing none. moderator are there any callers who have their hand raised? >> millionaire there are no callers who wish to be recognized. thank you. >> thank you general manager. item five b is fiscal year 2024 2025 second quarter budget status report and adjoining will be presenting. >> all right and if you could bring this slides up. good afternoon commissioners. it's good to see you again. we met two weeks ago. this is i'm now into my second month here at the sfa so i am taking over the quarterly

budget status reports and so this is looking back at q2. this is based on actuals from december. so these numbers will continue to shift throughout the year. >> all right. so there's going to be a lot of ups and downs and numbers in these slides ahead. the main takeaway here is that despite these ups and downs they largely balance out. >> we are on track and importantly we're continuing to meet our financial targets i should say our financial policy targets so so first what's happening in the water division overall on the revenue side, this represents an improvement from q1 but we are still seeing that retail volumes are down compared to budget and that is the primary cause of the revenue shortfall here. >> this is offset on the usage side by lower non personnel and debt service costs and based on the dry ish january we had some of that sales volume retail sales may

improve in the next month. one other note i'll make is that the water enterprise is running over budget specifically in the overtime line and that requires board of supervisors approval to overspend and over time we have a way to address that by moving other funds around. but we may be back to you in the next month or so to talk about that. moving on to wastewater, it's similar picture to water overall revenues are down compared to budget just due to lower volumes. some certain stormwater only parcels are still not collecting because they have no service agreements yet and this is offset by a handful of things including lower labor and debt service costs. moving on to power the revenues here are lower than they were in q1 and that's also because of lower volumes in retail sales. this is offset by some higher wholesale sales. >> and then on the users side you'll see some very large

savings and that's both because of lower power purchase costs also from higher generation and a few other changes in the budget. and then finally on clean power as jeff retail sales here are also lower than budget and that's largely because of the rates were set lower than budget and also there has been lower demand like we're seeing in some of the other enterprises. this is offset by slightly higher wholesale sales revenues and then savings from power purchase costs and then this is just a snapshot of our key financial policy targets and so we are meeting all those targets which just means that overall we're in good financial health despite some of the ups and downs you see. and with that i can answer any questions. thank you commissioner our say just want to say thank you to ed durning for the report i had

one quick question was out of curiosity with respect to the clean power srf general reserve plan to go ahead and spent what what then happens to that $40.5 million general reserve that we plan to go unspent? i believe that will just then carry over to the next year to save as a reserve. is that right, laura it just full stop savings account essentially we planned so we budgeted that as a deposit into our fund balance so it will go unspent and just deposit into our fund balance at year end and that as part of our long term plan to meet reserve policy targets in claim paris for fund balance laura bush deputy cfo thank you. thank you commissioner leave aroney thank you. budgets are budgets we all try to start off and try to make them all match and make it

work. >> do you see any trends coming on and going forward with lower retail sales and the lower energy that or wastewater that we see here? is that something that you might or do we think that's going to be corrected quarter two, 3 or 4? >> sure. so compared to budget there are a few assumptions that are made in budget planning. one is sales volume based on population growth and so our assumptions in the past few years and going forward is pretty conservative assumption in terms of population growth and the number of people buying our water and then it's just usage based on a bunch of different factors including the weather which is very hard to predict. we have a very smart financial planning team that does their best but that's going to vary to budget throughout the year. >> we can probably give you a more sophisticated answer than

that but that's what i've seen so far. >> thank you. that sophisticated answer would not be needed. >> thank you. thank you. i had a question about the water over time i. i assume that's because we are we're still quite short staffed in the water enterprise among other enterprises. >> is that correct? i think a number of different things. one, yes, some staffing challenges although i understand that water has been doing better on hiring than they have in years past so maybe less short staffed than they have been and then it's you know, work and maintenance and what happens in weather events sometimes also i'm learning what happens in dry when there's periods of dry weather they get out and they do more maintenance upcountry because they have the ability to. so it's a number of different factors in addition to staffing

. i see maybe mr. richie has something to yeah, he can probably add a lot more detail and clarity that steve ritchie assistant general manager for water one particular aspect this year is that we have a roughly 100 day shutdown of the hatch system so we are running excuse me we're running our water plant in the bay area here the two filtration plants to make up for the supply so they're running 24 seven all that time and so we're building up a lot of overtime as a result of that particular operational aspect. >> so it's kind of a one time event because of that. >> yeah, that's that's one particular thing we're still looking into other possibilities but we know for sure that we're spending a lot of money on overtime right there. >> yeah. okay. thank you so much. >> should we take public comment remote callers please

raise your hand if you wish to provide comment on item five b are there any members of the public present who wish to comment on this item? >> seeing none. moderator are there any college who have their hand raised? >> so then there are there are no callers with their hands raised. >> thank you. thank you. >> general manager the next item item five c is an introduction to capital finance in bonds presented by nicholai sklaroff good. good afternoon commissioners nicholas sklaroff capital finance director one of the more awesome powers you have as a commission is your ability to enter into bonds both to create

equity and to manage the impact of our capital costs on our rate payers. thank you. go to our slides please. over the coming weeks we have two transactions that we'll be bringing to you at your march 11th meeting. we'll be bringing a refinance hansing for our water enterprise and at your april 9th meeting we'll be bringing another transaction which will include new money and some more refinancing and we recognize that for several of you this will be your first time as commissioners approving bond transactions. and so today we want to provide you with a brief overview of bonds. now when the state's commission of that helps to educate issuers provides education on the fundamentals of bonds, they do it over three days. so i can't possibly give you everything you need to know in

ten minutes here but i do want to provide you with an overview . we have some resources in our deck. i particularly highlight the on the last page the california debt and investment advisory commission provides valuable tools for commissioners and elected officials to provide you with some of the tools that you need for understanding bonds and your obligations. but if i can turn to the next page please will discuss how our bonds are authorized. thank you. >> we'll discuss. >> there we go. how our bonds are authorized, our debt program and then how we go about issuing bonds. so let me begin with talking

about our debt program overall i think sometimes as we think about bonds we associate them with credit cards and i'd like to suggest that's not the correct frame for you. >> our bonds are an important tool that this commission uses both to create equity as well as to manage the impact on our rate payers first in terms of equity, the facilities that steve robinson and the infrastructure team are building today will be used by businesses by residents for the next 20, 30, 40 years. by using bonds we allow those users some of which haven't moved to the city yet haven't even been formed yet as businesses over time will all have an opportunity to contribute to paying for those facilities. that's how we create

intergenerational equity. we also use our bonds to manage the impact of these costs. some of our facilities are billion dollar projects and we wouldn't want to have rate payers today bear those full costs. even more importantly the tools that we use to borrow include advantaged financing. you as commissioners have the opportunity to approve tax exempt bonds, tax exempt bonds are bonds where the investors typically don't have to pay federal income tax on those and as a result they accept the lower interest costs for that debt. so you get a much lower cost than for example, corporate borrowers. we also take advantage of low interest loans from the federal government including the with

your loans that you've approved in the past and also our state revolving fund loans. so we are able to borrow at much lower costs. >> the third piece the second piece of this is that we are repaying over time most of our debt is repaid over 35 years an important concept in our world and for our capital finance team and the financial partners we work with is the time value of money. a dollar today is worth much more than a dollar tomorrow because of inflation and certainly much more than a dollar in 30 years. that is why we pay interest is because we're paying back over time with dollars that have less purchasing power in an era where recently inflation has been seven 5% you can understand that are interest

costs of 3 to 5% are actually quite low. finally an important concept is that by borrowing today we're able to allow steven and the infrastructure team to go ahead and build those projects and not wait for costs to go up especially here in the bay area where construction costs are going up more than 9% a year. so again our borrowing while we we know we've had lots of phone calls and speakers talking about our debt, it is a very important tool that you have for managing our rates. our debt authority is provided by the board of supervisors. it really comes from proposition a and c that provide us with the opportunity

to issue debt without voter approval based on first having that authorization from the board of supervisors as you saw at your last meeting on february 11th as part of the budget process we saw a increase in the authorization for the water enterprise for example. we have to provide certain certificates as part of that a an engineering certificate, a financial certificate and an environmental certificate. but that's the basis for our authorization and then we come back to you as a commission each time we do want to borrow. >> it's an important distinction between the way we manage our debt program here at the s.f. p c and perhaps what you may have witnessed from other bodies where typically a project may be approved and finance at the same time by the time we are approving bonds

you've you've been spending those funds based on your budget approvals and we're trying to issue our debt as late as possible to again mitigate the the need for interest costs. so that all comes from that comprehensive planning process that you heard about at your last meeting and and that's how we plan our debt. so today we have about $11 billion of debt outstanding as you can see on this chart, our debt is particularly concentrated with our water enterprise where we just completed the with the program . our wastewater enterprise is catching up quickly with sister and we have a smaller amount of debt outstanding for our power enterprise. this chart provides you with

the details of the different types of debt that we use. this one also includes the undrawn capacity we have from certain loans so we haven't yet drawn upon. so we have about $10 billion of debt that will be issuing over the next ten years. >> again, the debt the debt that will be coming to you with first will be for the water enterprise. it will be a refinancing which is not part of this new debt that is shown in this graph and then the new debt will be coming to you in in april. one of the things that we will be presenting to each time we come to you with a debt transaction are our bond ratings under our city charter the sfp c has an obligation to set rate payer rates sufficiently high to maintain

high ratings by maintaining high ratings we are able to borrow at low costs and so each time we do borrow we we go to the rating agencies. in fact our general manager or our cfo, our atms have all just completed presentations to both moody's investors service and s&p global ratings as part of the transaction that we will be presenting to you on march 11th that that will be an important step for us to as a p c enjoys high ratings today but we there are pressures out there as you know, the city has recently lost its triple-a ratings and had downgrades. we are seeing concern about the

water sector generally but we we have just completed very good presentations and will be coming back to you with that. >> the last thing i want to leave you with is that one of the most important documents that we'll be bringing to you is the official statement. there'll be a number of documents but the official statement will be the offering document that we present to investors. this will summarize the transaction will provide a lot of information about the sfp c and you as commissioners will have an obligation to ensure that staff and and you are comfortable that it doesn't contain material misstatements or material omissions. and so again this is intended to be a brief introduction. again ten minutes is very very short for an introduction and to such a complex topic we

will provide you more specific information about the bonds on march 11th. but with that i'm happy to answer any questions you have as you think about this topic. thank you so much. it's a it's a really important component of all that we do here and how we approach rates and keeping costs down. >> and i also really appreciate how much i've learned in the last two years of being on the commission with the matters that have come before us in the education that you and your team have provided and this is another very helpful piece of that. so thank you commissioners questions, comments. >> commissioner levy aroney thank you very much very in the ten minutes very enlightening. >> going forward, you know bonds eventually have to be paid and you know usually early

as you mentioned it's a lot is based on our future projections of businesses residents moving in are you confident thus far with the predict with the predictions that we're making going forward with those, you know, businesses moving into san francisco or residents and yes, for sure. i think one of the things that i would hope gives you comfort as a commissioner is that these bond transactions are the outcome of an intensive planning process. the ten year financial plan that you proved at your last meeting lays the the map forward for how we would repay debt and not only that but how we would maintain debt service coverage. in other words, we don't simply set our rates in order to meet

debt service but we maintain coverage of that debt service for the investors that coverage is then able to be used for for projects after that debt service is paid. >> thank you commissioners any other questions now i'll take public comment please. >> remote callers please raise your hand if you wish to provide comment on item five see are there any members of the public present who wish to comment on this item? seeing none. moderator are there any callers who have their hand raised this linear? >> there are no callers with their hands, right? thank you. >> thank you commissioner ah say that you want to make a comment or ask a question. >> i just wanted to before we close the general managers report if we're on five c or d

just wanted to find a way to make one more observation maybe a historical footnote just just for folks since i think we're still in the realm of five a, b, c, d we should probably call item five d the report on recent san francisco public utilities commission's activities events and announcements. >> yeah. okay. thank you, madam president. nothing really to report other than you may have seen recently in the news that a great community member and former puc commissioner ethics crowley passed away. he was a labor leader, a great community member and a commissioner both here i think he was at the port and certainly the civil service commission and he was his funeral was last week and his wife nancy works for us. she was press secretary here at

the puc and a wonderful woman and wonderful family and a wonderful man and he was taken much too soon. so i just like to point that out and hopefully we can adjourn today's meeting and in his honor i'd be pleased to do that. he was an amazing public servant commissioner r c yeah i just i just wanted to add one kind of if i can another kind of book an item around the general managers report and because in the beginning we were talking about the the webb's program and the impacts on communities of our work around local and hyper local hiring and contracting and we we wouldn't have these laws 15 years after they went into effect if we hadn't got the legal green of green light to to pursue at that time which was low was a first in the nation strategy to have

mandatory local hiring after years of constitution hall challenges and different approaches that that were ultimately unsuccessful but we we as a city and county got a green light to pursue a first in the nation policy to have these kind of outcomes 15 years later simply because our city attorney at that time said yes, let's do this and authorize the city to pursue that strategy and the city attorney at that time was none other than are current as a general manager he was pretty good. >> he was really good. so general manager dennis herrera, thank you for giving us that green light when you were a city attorney all those years ago. >> thank you. my pleasure. and city attorney's office as president stacey knows did stellar legal work with a lot of incredibly talented people. so you know, i was just one of a bunch who do great work and they continue to do great work. >> thank you. thanks. thank you both. >> call the next item please.

item six bay area water supply and conservation agency report . >> good afternoon president stacey and commissioners. i wanted to use my time today to compliment your staff. >> last thursday we held the annual wholesale customer meeting at the middlebury campus for the regional water system. we had about 30 representatives from both agencies there and while this is a required meeting under the water supply agreement i thought it was an excellent example of transparent, easy collaboration and good customer service for the wholesale customers who as you know provide about two thirds of the water revenues 12 of the species staff members spoke about their areas of expertise including general manager herrera. thank you her manager, her many other many others on the staff were available before and after the meeting to answer individual questions of the wholesale agencies.

i wanted to bring two topics to your attention because i think they were important and discussed at the meeting. the first was at our agency's request your staff spoke about the opportunities to work together on emergency preparedness and disaster planning, especially in light of the recent wildfires fire tragedies in southern california. i'm really excited about this reinvigorating this program. it's been going on for many years but after the pandemic it kind of went a little bit more virtual and we're hoping to get back to in-person exercises with the with the agencies and with sipc. second, in one of your representatives addressing the current cfp, the staff presented on a significant project and that's the moccasin pen stocks. commissioners may be aware of the planning for this project. they may have recently seen them commissioner say it's a critical project both for the water customer regional water

customers as well as for power production and it's part of the ten year cfp but i know we heard at the meeting that it's likely to be more expensive. it's likely to take longer to plan and decide what to do there. so i look forward to continuing our dialog on this project as it develops more certainty of design, timing and cost. once again thanks again to the staff for making that a great presentation last thursday and i appreciate the thoroughness of all the who were involved. and that ends my remarks. happy to take any questions. >> thank you and thank you so much for your work at buska and the continuing collaboration. could i ask a question about that meeting? was it just an informational meeting with all of your sort of component agencies and q&a with a staff? >> is that do i understand? yes. this part is part of the water supply agreement. there's an annual meeting so all agencies were invited.

i don't want to speak for you but we had i think representative from every agency there so all of the departments that are relevant to the agency spoke i think we all agree that the most exciting part is when nancy gets gets up and says what the rates are going to be for next year. so but we're obviously concerned with a lot of other a lot of other interesting things that are going on both in capital and finance and emergency preparedness etc. . >> yes, it's an annual meeting that happens in february of each year and as tom says, we tell them what the rates are going to be but we go through a variety of subject matter to our meeting. i present as well as all of our representative departments and we talk about you know what might be going on in washington legislatively, operationally and everybody presents it. thank you missioners any comments or questions should we

take public comment? >> thank you michael. please raise your hand if you wish to provide comment on item 66 are there any members of the public present who wish to comment on this item? seeing none. moderator are there any callers who have their hand raised? >> ms.. lynn neary there are no callers with their hands raised. thank you. item seven consent calendar item seven b award contract number ww-727 will not be considered as part of the consent calendar today. >> okay. thank you. so on consent calendar item seven a and seven see commissioners do you have any comments or questions? >> okay. could we have public comment on the consent calendar place?

>> callers please raise your hand if you wish to provide comment on item seven the consent calendar. are there any members of the public present who wish to comment on this item? seeing none. >> moderator are there any calls to have their hand raised ? >> listener there are no callers with the answer. it's thank you. okay. thank you. could i have a motion in the second to approve the consent calendar just seven a and seven c motion to approve seven a and seven c second. >> thank you, stacy. a vice president r c high commissioner jammed r i commissioner level roni i. >> the item passes item eight the regular calendar approve the form of a revolving credit agreement with wells fargo bank national association in the total principal amount of 200 million and the related fee agreement.

>> good afternoon again commissioners nicholai sklaroff capital finance director if i could have the slides please. commissioner, as you'll recall at your last meeting we brought to you three credit facilities. these were credit facilities that backed our commercial paper program. this agenda item is for two more facilities one for water, one for power. these are slightly different facilities. these won't be for letters of credit tobacco, commercial paper. instead these will be for our revolving credit agreements where we could draw against these facilities. again, our interim funding program allows us to manage our debt programs so that we are only borrowing when we absolutely need to. we use our interim funding program to obtain controllers releases very efficiently and then to borrow

incrementally. this item is for a single credit agreement that includes two separate facilities one for the water enterprise, one for the power enterprise each for $100 million. there is no cross default. they are entirely separate obligations. just as a reminder for the water enterprise last meeting you approved the $100 million sumitomo renewal and the new agreement with pnc bank. we have $100 million of authorization and this will now use that remaining authorization for the water enterprise. this is all part of the expansion of our interim funding program that the board of supervisors and the mayor approved effective christmas day for the power enterprise.

same situation. you approved a facility last month our sumitomo bank that was a new facility and we will add another new facility using the remaining $100 million of authorization. this is the result of a solicitation conducted by our municipal advisors vincent mccauley of baxter mccarley is here with us today to answer any questions we have any. but again, we use the city's credit facility pool that is currently managed by the airport and rfp from there. this facility will as i mentioned, not be based on commercial paper but instead is based on its own rate established under the agreement based on an index call. so for many of you have probably heard of the libor index, the london interbank

offering rate that was eliminated so far is the replacement index that is used. the rates on these facilities is should we ever use them would be based on this index. it's important to bear in mind that as we've explained before, we obtain an advantage by simply having these facilities simply entering into the agreement gives us the capacity to release those those amounts that are on controllers reserves very efficiently without having to issue bonds and incur interest costs. these are three year agreements. wells fargo bank has high short term ratings. we can borrow on both a tax exempt and taxable basis under these facilities.

under sb 450 we're required to provide a good faith estimate. our municipal advisors at baxter mccarley have provided that estimate. this is that estimate. if we were to have borrowed on on the day this was submitted the rate would be 4.69%. currently our commercial paper rate as much more efficient. so we would use that if we were actually borrowing today. again, simply having this not only diversifies the tools at our disposal but also provides us with capacity for those controller releases. these facilities as with the facilities at your last meeting can be extended up to nine years. we typically don't do that. we typically go out and see what pricing is available in the marketplace but we have

that flexibility. should market conditions warrant that again? we would ask for your approval for this $200 million credit agreement includes two $100 million facilities one for each enterprise. and with that i'm happy to answer any questions. thank you. commissioner lavrov, any questions? >> comments. >> so i understand these are revolvers so only needed went to paid in in a not necessarily emergency situation but to draw down on and and use for our project that we need to fund before we do this ever get turned these revolvers do they if drawn down do they get paid back within a short period of time or do we then take them out with either a bond or different type of paper? >> yes.

so for all of our interim facilities to the extent that we borrow against them, whether it's the revolver or whether it's issuing commercial paper, we would accumulate those short term obligations and then take those out with a bond transaction given the cost differential between commercial paper and revolvers in the current marketplace. oh, we would this would not be our first choice to use this facility but we have that flexibility cause rates are constantly moving and these are particularly valuable should anything ever happen in the commercial paper market that causes us not to have access to that market. >> and then this would be part of our when you look at our bonds, do you anticipate these being drawn down and used and then that's hence why we

have the bond save facilities and going forward is it looking to take these out? i mean so there is contemplation of these whether that be the commercial paper or the revolver to be used. >> so i would put it in three buckets. first simply having the facility allows us to demonstrate to the comptroller's office that we have the resource against which to release the comptroller reserves. secondly, to the extent that we incur capital expenditures we borrow only what we need either from commercial paper or less frequently from from revolvers. and then once we've accumulated those short term borrowings we take it out with a bond and that allows us to defer entering into bonds and incurring those long term interest costs.

>> thank you very much. thank you. >> thank you. let's take public comment. remote callers please raise your hand if you wish to provide comment on item number eight. are there any members of the public present who wish to comment on this item? >> seeing none. moderator are there any callers with their hand raised? ms. linear there are no callers with the answer. >> thank you. okay. commissioners, could i have a motion and a second on item eight? >> i move that we approve item eight. seconded. president stacey i. vice president rc high commissioner jammed our high commissioner level running high. >> the item passes. item nine approve the expansion of the california water service bear gulch district service area and approve the fourth amendment to the individual water sales contract between the city and county of san francisco and cal water.

good afternoon president stacie commissioners. i am allison customer. i'm the baskin wholesale customer liaison for the water enterprise with the sabc. >> the item before you is approval of an expansion of the service area for california water service company cal water. and approval of the fourth amendment to their individual water sales contract under the water supply agreement and the individual water sales contract . we have a service area map that is attached to the contract and this action updates that map for the one item which is a san mateo county park flood park. they did a renovation upgrade that required water service from cal water on the opposing side of the park from their original menlo park water service. >> there's no adjustment to the menlo park individual water sales contract because the original contract service area map is appropriate and needs no change, said this is the one item change and i'm happy to

answer any questions related to this. thank you. commissioners comments or questions? could i just make sure i understand sfp is limited by this map but boundaries can change within the map which is what's happening here and which we've also approved. a couple of other map adjustments for cal water in the last couple of years as well. >> correct. so this service area map basically attaches to the individual contracts so we know where cal water is authorized to provide the purchased water from the san francisco system under the contract without the need to have prior written written consent from the sfp u c to serve anywhere outside that area and typically it requires an action before the commission to amend the map for a permanent change to that and that is that is those prior actions were similarly a

transfer with redwood city for seven customers was the first amendment capturing their acquisition of skyline county water agency or water district which occurred actually in 2009 but had not been fixed in the service area map and a couple of other actions which were small mutual water companies they acquired because those individual systems were not able to maintain their water quality and adequately serve their customers. so that was skyland and kings mountain mutual water company. thank you. yeah. >> should we take public comment? remote callers please raise your hand if you wish to provide comment on item nine. are there any members of the public present who wish to comment on this item? >> seeing none. moderator are there any callers who have their hand raised? >> the sooner there are no callers with their hands raised. >> thank you. commissioners, could i have a

motion in a second on item nine? >> i move that we approve. move item nine. my second. thank you. president stacy i. vice president r.c. high commissioner jammed our high commissioner level moroney i. >> the item passes. thank you. next item ten approve amendments number one to contract numbers pro .02 31a through d. specialized and technical as needed services with stantec jhc joint venture pro .0231. a mmd jv pro .02 31ba aecom w r e g pro dot 0231. c and lee incorporated pro .02 >> 31d. good afternoon again commissioners steve ritchie assistant general manager for water. we're looking for approval on amending the four contracts for

specialized and technical as needed services that are needed to support our work and all of the capital improvement project. capital improvement capital improvement projects up and the hetch hetchy area which includes technical studies of different kinds and support services there as well as how we fit these into our asset management system and environmental and regulatory requirements such as all of the work and work requirements that we need to comply with going forward. we actually have been expanding this is a higher rate frankly due to the increased rate of capital improvements up in headsets. this is actually a very nice period of time up there where a lot of projects are happening at once through the commissioners and of course saw the mountain tunnel project and the moccasin generator projects. but there are also major

projects going on throughout the san joaquin pipeline area and some other areas. so it's a very active time up in hejazi and these are necessary resources to help support those projects. i'll be happy to answer any questions and i'm also joined here by cheryl sperry from hetch hetchy in case you had any further questions that i'm unable to answer. >> thank you commissioners comments or questions commissioner say yes. >> thanks presentation. thanks jim richie the thing i wanted to say was thank you to to cheryl and the team for showing us the facility is there at moccasin. i think later on i'll be able to speak to some of what i learned on that trip when we when we talk about some of the later items. but just i think what for you just to kind of hear the feedback just the expertise of

of you obviously with all that you do but your team up there really helping all of us who had the chance to go visit mountain tunnel and moccasin facilities last week really helped us to put into context all the not just important work but the thorough and comprehensive and very, very high quality effective work but also complicated work. so i think it really helped put in perspective just the importance of us receiving the information and being able to defer to all that work that's happening. and so lucas is here as well and just everything that's happening up there really was important important opportunity. i know present stacy's had the chance to to do so as well but just grateful to you and your team for all the information that was shared with us and i'll be in support of the item for sure that it was a pleasure and there's nothing like seeing it in the flesh to actually really get a good idea of what's happening.

>> yeah well learn learn a lot of the history too from from allison castleman and katie miller was with us of course jim robinson it was just completely important educational experience for me personally and i and i know from my colleagues who went up last week too so thanks. >> okay. thank you. it is impressive and complicated work to be sure up there and the tour only teaches us just how big some of these projects are. i do i get concerned when i see big increases and this is a 70% increase for both of these contracts and while i recognize that these projects are very complicated and large, i wonder was there something unexpected that you needed from this joint venture to result in in such a high percentage increase in the contracts? >> yeah, there's there's actually four separate contracts so i would not say

there was any particular thing that popped up all of the projects as we're all well aware have things pop up but in addition i think the the routine aspect to these is that we have to fit all these new assets into our asset management system and that is a complicated process of making sure they're properly fitted in there along with our work and work regulatory requirements. so these are you know this is like i said this is a little unusual in that we're indeed in this increase sooner than we expected. normally we would have been, you know, just now starting you know, on a new contract. but you know, we've got these available now and the work is there to do it right now say okay, thank you take public comment. >> remote callers please raise your hand if you wish to comment on item ten.

>> are there any members of the public present who wish to comment on this item seeing then moderator are there any college with their hand raised ? listen there there are no callers with their hands raised. >> thank you. thank you commissioners. could i have a motion in a second on item ten motion to approve item ten second. >> thank you president stacy i vice president r c i commissioners yamaha i commissioner lebron i the item passes thank you item 11 adopt the refined mitigation monitoring and reporting program pursuant to the california environmental quality act and award contract number 1-2909 so no valley water treatment plant short term improvements to western water constructors incorporated. >> good afternoon president stacy and commissioners felicia

reinhart, project manager for the snow valley water treatment plant short term improvement improvements project the item before use request to adopt a refined mitigation monitoring and reporting program pursuant to the california environmental quality act and award the 2909 contract to the lowest responsible bidder western water constructors the snow valley water treatment plant is in alameda county which receives water from the san antonio and calaveras reservoirs and plays a key role in providing clean safe drinking water to sfp c's regional water system. >> i'm going to take a moment to provide some history on projects at the plant. >> in 2013 during the water system improvement program the snow valley water treatment plant was upgraded to increase its capacity and added treated water reservoir storage tank following with the osage nation project was initiated in response to taste and odor issues and is currently under construction with completion expected in 2029.

additionally the short term and long term improvement projects were launched to address deficiencies in parts of the plant that were not covered by previous projects. focusing on repairing and replacing aging portions of the plant to enhance reliability. these two projects follow a phased approach with the short term improvements project which is presented today addressing the most urgent needs first. the main objective of this project the short term improvements project is to repair and replace several treatment systems at the treatment plant. a key aspect of the work includes rehabilitating certain original elements of the plant which date back to the 1960s and 70s. >> specifically the project will focus on repairing the deteriorating concrete at the sedimentation basins replacing critical equipment that has reached the end of its useful life such as sludge removal systems and pumps and addressing leaking valves to improve both efficiency and a reliable fee.

additionally, a utility water pump station will be installed to support the new ozone ation treatment process facility. >> the contract bid documents were advertised on october 31st, 2024 and include requirements for the social impact partnership program. five bids were publicly opened on january 16th and after factoring the compensable delay and social impact partnership discounts western water constructors was ranked as the lowest bidder. the engineer's estimate was 47.4 million and the low bid was 44.9 million. this is within what was expected for a contract of the size and amount of interest received based on the bid evaluation staff recommends accepting the low bid from western water constructors and awarding this contract. in addition to awarding this contract you are adopting the refined mitigation monitoring and reporting program that will

be implemented for this project as part of the environmental review in july 2023 the planning department issued an addendum and a refined mitigation monitoring and reporting program to this and all valley water treatment plant. environmental impact report which analyzed the scope of this project the ozone ation project and a future polymer feed project. subsequently the planning department issued a minor project modification for the utility water pump station scope which is also included in this project. thank you for your time. >> i'm happy to answer any questions you may have. >> thank you for the presentation and the sort of bigger analysis of everything that's been going on in and around the senate the snow valley water treatment plan it was a question that came up for me when i was looking at the agenda. i try and remember all the pieces. we've had a number of items come before us recently but your summary was very helpful. thank you.

commissioners, any comments or questions? no. take public comment. remote callers. >> sorry commissioner lebron last not knowing. >> not knowing the project you know totally and visualizing it is is when the contractors the five contractors bid on it was it pretty much the work that needed to be done was all unlike say the the mountain tunnel where a lot of things are buried and you couldn't see things and aging systems and all that. >> was this pretty much straightforward where they could see the what needed to be done and where i'm going with this is obviously i get so nervous about cost overruns and change orders and everything with this one fit more into a pretty standard visual contract that they are

not saying well you know come back in a month or two months and say oh we missed this or not missed it but we didn't realize this behind the scenes right? >> yeah. most of the work on this scope of this contract is you can see it in the field. so there's no there's not very much underground work so we don't anticipate many unforeseen conditions. it's also straightforward being repair and rehabilitation and type project replacing existing equipment that is there. >> great. >> thank you very much. thank you. now we'll take public comment. >> remote callers please raise your hand if you wish to provide comment on item 11 and are there any members of the public present who wish to comment on this item? seeing none. moderator are there any calls to have their hand raised? >> this one there there are no callers with their hands ringing. >> thank you. thank you. commissioners, could i have a motion in the second on item 11 motion to approve seconded.

>> thank you, president stacy i. vice president r.c.. commissioner gender high commissioner level roni i the item passes. item 12 approve an increase of 365 calendar days to the duration contingency for contract number 2845. cathartic protection for transmission pipelines at various locations. phase two with zero technologies corporation. >> good afternoon commissioners. my name is teresa keel, project manager for the sfp. you see i'm here to request your approval to increase 365 calendar days to the duration contingency. this is for contract wd2 an 845 cathartic protection for transmission pipelines at various locations phase two project with zero four revised

duration limit of up to 1168 calendar days with no change to contract amount. the increase is to provide additional time to complete remaining contract work due to any delays in providing utility power service. i'm happy to answer any questions. thank you commissioners. any questions or comments? now let's take public comment. >> remote callers please raise your hand if you wish to provide comment on item 12 are there any members of the public present who wish to comment on this item? seeing none. moderator are there any callers who have their hand raised this linear? >> there are no callers with their hands raised. >> thank you commissioners. could we have a motion in the second on item 12 motion to approve item 12 second thank you president stacy i rise

president r c i. commissioner jammed our high commissioner level ronnie high the item passes item 13 approve an increase of $2 million to the cost contingency and an increase of 350 calendar days to the duration contingency for contract number ww723r channel force main enter tie with anvil builders incorporate it. >> good afternoon commissioners president stacy my name is carmen luke and i'm the project manager for this contract. i'm here to present this agenda item to increase the construction costs and duration contingency for this contract. number seven wwe is 723. our channel force main entity is located on cesar chavez. between indiana and pennsylvania street this project is constructing an underground pipeline connection and control valves between two existing sewer facilities the channel force main and the is this creek transfer storage box i c t. we're asking for a commission to approve an increase of $2 million to the cost contingency and increase of 350 calendar days to the duration

contingency to this contract for revise the contract limit of $19,375,899 and a total contract duration of 1131 consecutive calendar days which is approximately three years and one month for the time extension the contract issued notice of. put too late admit dry weather period of 2023 due to various insurance documents delays which left only one dry weather season available in 2024 for the dry weather restricted work hence an additional dry weather season in 2025 this year is needed to complete the remaining work in this year in addition. >> unforeseen conditions were encountered during construction which contributed to the additional de-watering needs. there are unknowns during time of bid which includes the contractors dewatering system and the rates and allowable rates are dependent on the groundwater discharge permits which is obtained during construction. because of these two allowances for de-watering was under estimated on the contract

and the additional cost contingency increase is needed to support the ongoing two water activity activities for the scope of work and to continue to remove groundwater for the duration extension. hence. thank you for your time and happy to answer any questions. >> thank you commissioners any questions or comments? commissioner leave aroney just just one question. i'm sorry i'm not familiar with deep water in the concept of what that really is. >> okay. the process of de-watering is to remove groundwater from the construction site using pumps and other methods. its purpose is mostly to prevent instability and to ensure a safe working environment when we are excavating deep down underground. i also had a question about the dewatering what was unforeseen about it? was it because it was a very wet year or was it a higher water table in the area than anticipated or maybe both?

>> so the unknowns. includes utilities because before we can confirm the shoring design system they need to confirm the location of the utilities and once they are able to confirm that the design the contractor designs assuring a system which works in parallel with the dewatering system and determines what's the actual dewatering needs it. so once the contractors are on board they're able to confirm that and come up with a design or de-watering system which is not anticipated at the time of bid. i see. so it was really influenced by the location of the utilities on site, correct? okay. thank you. >> public comment remote colleagues please raise your hand if you wish to provide comment on item 13. are there any members of the public present who wish to comment on this item? seeing none. moderator are there any callers who have their hand raised this one there are no callers with the hands raised. >> thank you. thank you, commissioners.

>> could i have a motion and a second on item 13 please? >> i move that we approve item 13 second. thank you president stacy i. vice president r c i commissioner gender high commissioner leave aroney i the item passes item 14 approve amendments number one to agreement numbers pro .0275. >> a through c. hedgi capital improvement projects as needed construction management and staff augmentation services with accom and effective management services l l c joint venture pro .02 75aa villa and associates consulting engineers inc pro .02 75b. and techy c m partners joint venture 0.0 275c to provide as needed construction management services to augment city construction management staff as necessary may have the sites please. >> good afternoon commissioners

jim herrera lucas hoffman i'm the regional construction manager for the capital improvement project. i'm here today to seek approval of amendment one for professional services contract pro 275. hedgi capital improvements project as unit construction management and staff augment augmentation services. i just real quickly the slide shows the basic general territory of the hetchy capital improvement project. this includes the hatch hatch such a regional water system that ranges all the way to the far east that hatch hatch reservoir and u 70 national park all the way to the far west to the tracy area. it's approximately a hundred miles. linear miles of distance that we cover from in this the central hub for the regional system. it's an approximately 1.5 hour in either direction to reach the outer regions of the system that includes dams, tunnels, burn stocks, hydroelectric generators, high voltage transmission lines, large diameter pipelines and other critical water and electrical facilities.

>> just quick background on pro the pro 275 contract originally awarded in september 2023 by the commission pro 275 is made up of three individual contracts each with the original not to exceed amount of $4 million and a contract duration of five years. chapter six of the administrative code allows for the sub pc to have a sole discretion to increase the not to exceed agreement amounts by a maximum of 150% of the original not to exceed amount the services covered under the housing and construction management contracts include construction and operation change management construction inspection as well as safety inspection project and document controls testing start up commissioning services, environmental compliance monitoring supplier quality surveillance and especially laboratory testing as well. >> currently the statutory capital improvement project is thriving. we currently have out of the

ten active projects that we have nine of those are covered are utilized to 75 to provide the construction managed services to oversee the project completion process. 75 is not only use for active constructions but it's also used for pre-construction activities for future projects as well as close out activities for completed completed projects beyond substantial and final completion. the slide also shows a list of the nine projects that are currently active and it kind of gives you representation of the type of projects but also the locations within the systems of a couple of more slides that have some photos that show you some of these. so the official requests of amendment number one for projects in five is to increase each of the three pro to 75 contracts by $2 million for a not to exceed amount of $6 million per contract with no change to the contract duration in order to continue providing c m services on the outstanding basis for hhc ip projects are

the reasoning for the contract modifications is that one because of the increase active construction projects requiring significant c m workforce beyond the available city c m staff compared to a few years ago we've more than doubled the active projects and so like i said we are thriving significantly and highly technical construction activities taking place during the hetch hetchy regional water system outages that occurs from december to march. these outages require construction work to operate typically on a six day workweek and up to 12 hours work shifts thus requiring a significant amount of personal overtime and to maintain required project oversight. additionally, because of the technicality of some of these projects we need additional c m staff to serve as technical advisors and or construction specters during the projects to support the main project c and staff. an example of this would be a

hydroelectric generator technical advisor electrical protection and controls engineer and underwater diving oversight inspector also existing task orders for individual c m staff augmentations need to be increased so that there is enough budget to extend their services through the end of the contracts and also some of the construction projects have up to four active individual work locations thus requiring additional staff to be present at each construction location for quality assurance but also for security as well as a security oversight. this is true for the san joaquin pipeline project that spans more than 40 miles and has the locations are well with over ten miles apart from each other. >> just real quick, just some pictures everyone knows pictures. this is of db 121 or 2 marks and partition or a real rehabilitation so we have our rewinding the existing generators are moxon they are well beyond their service life too and this is some examples

are some photos showing the far left or far far right photo shows the actual rotor being lifted in a place that's about 128 tons being lifted there. big big mass of metal and copper. you got the shaft you can see in the in the middle photo there with one of the bearings that helps keep this shaft aligned and the photo on the left is the actual rotor and the standard there with the top off so you can see it fully there and walk so another project all the way up to apache reservoir, o'shaughnessy dam. it kind of gives you an idea of another kind of hard difficult logistical working location is a 1011 o'shaughnessy dam and streamflow release for replacement. the photo on the left shows kind of it's a one way road and you can see the crane there adjacent to a cliff next to the river. there's a little building there that basically provides very little access to what that building is sitting over a diversion tunnel with a shaft about 100ft deep we've gone

through and you can see in the photo on the right all the blue piping we installed four new valves there. the replaced some existing valves that were over 100 years old and dilapidated and literally had holes in them . and so you could see the fault in the mill is there. we're actually dropping one of the valves in there to where the logistical item of this is. the crane would lift it outside, put on a cart, you push the cart inside the building. he then drop a crane the crane hook through the sealer, the hole in the ceiling, pick it up, move the cart out, drop it down and then there's even the gas ukraine down below to help move that around so very technical then another project gbx 135 o'shaughnessy dam new bulkhead system this was a progressive design build to install or to design and fabricate new bulkheads that would provide single point isolation on the dam so that we can actually in the future go in and replace all the old aging valves that are 100 years old as well. so this involved diving and a

lot of test things. you can see the bars there on the water body as well. very important project for the future. and then another one just on the san joaquin pipeline hh1 thousand nine this is the touch test the search tower. this is at the far end of the the region before it gets turned over and goes in the coast range tunnel we provided are currently active right now building a search tower that is going into that will be there to protect the san joaquin pipelines in case of a surge event and so it involved that photo on the left is a 12 foot diameter t that you can see about compared to the size that an excavator and the people walking around it and then a new six inch pipeline that went up to the tower you can kind of see in the right hand phone of the existing tower that it's more for the coast range tunnel. this one like i said is for the actual pipelines that protect it and that photo on the bottom kind of shows the general there were partly fitting up the tower for last week but we're doing a little bit more work

and then it will be completed by next week so at this time and take any questions that you may have. thank you and thank you for the photos. it's great to also have human beings in the photos so that you can see the vast scale of the work that's going on it it really being out there really brings that home but photos it it it's amazing the scale of some of these projects and as you mentioned the sort of technical expertise and work that's required for them. i also just wanted to appreciate your staff report. you were very thorough in explaining why we needed the increase and you provided a lot of detail. that's always the question i have when we have an increase like what caused the need for the increase in your staff report was very clear about that as was your report today. so thank you commissioner leave aroney thank you very much for your report and it was very clear so i appreciate that.

so technically just doing a simple math what we're doing 2 million per per so it's $6 million about yeah and then i missed the duration it's not changing but when it when do you think the end of it will be duration i believe was supposed to be in 2028 and we will likely max out on the budget before we get to that five years. okay. >> thank you commissioner ah say thanks presidency. >> thanks lucas for the presentation and for the time you spent with with me and all of us set up at the mountain tunnel and at marcus in last week i, i wanted to just say that it really helped me too because i know that we have like president stacey we we're always keeping an eye on on budget and costs and and for all of us and particularly as a rate peer advocate with an eye toward rates but what i experienced in learning from

you and from paco and emily on our tour and the time we spent with steve, katie, alice and everyone up there at that time was just there's so much expertise and so much cognitive sense of what we're thinking about here at the commission that's transmitted from the system that is really responsive to such complicated work that's up there, such changing dynamics whether it's everything from weathered unforeseen geological circumstances or anything at all. and so it gave me a whole lot of confidence in our staff and our team and our partners and the contractors up there that when we get a request and say this is something we need i feel really good that it is something you need and it's something for us to offer our support and to help provide those resources to you to get the job done. >> so thanks. >> thank you. thank you commissioners public

comment remote callers please raise your hand if you wish to provide comment on item 14. are there any members of the public present who wish to comment on this item? seeing none. moderator are there any callers who have their hand raised this one there there are no callers with their answering. >> thank you. thank you commissioners. could i have a motion in a second on item 14 please? >> i move that we approve the second. thank you president stacy i am vice president rc high commissioner jantar high commissioner lover hi the item passes. >> thank you. item 15 communications. >> i'm sorry. go ahead. commissioners, do you have any comments or questions on any of the communications? no thank you.

item 16 items initiated by commissioners. >> commissioners any items to initiate? >> commissioner gender thank you president stacy. i had a request. general manager herrero wanted to request a briefing for the commission on the san francisco climate action plan. i know it's being updated this year so a briefing and a public hearing on how the agency's goals align with the climate action plan. the bay area air district has passed zero nox rules that phase out appliances, gas appliances. how that kind of fits into the affordable housing strategy for the power enterprise and clean power reserve. so i'm interested in having that conversation and it would be great if that can be calendared for. >> we will we will get that scheduled. >> thank you. thank you. really important issues. >> commissioner rc thanks president stacy my item is to share our well i had the chance

to kind of report out on on the tour and seen the spend a lot of time in the in the mountain tunnel itself and in the area where the the new valves were created. i know you all did that that that tourism well 16 flights into the earth. and so just again appreciate everything that was learned on that on that visit and you all taken the time two days last week to take three different commissioners up there. but i also the week prior i visited citizens advisory committee of the public utilities commission and spent probably about an hour in conversation with the hard working citizen advisor members of that body. a lot of the conversation was spent on the one item i kind of wanted to report out and which was around treasure island

and power outages that have been experience here at treasure island. we did spend a lot of time as well talking about water policy as it relates to all me river and the salmon population and kind of different approaches around habitat restoration and i think there was obviously to be quite honest questions or opposed to me that i deferred until getting some some more understanding of the issue but related to kind of the ongoing conversations around design drought methodology and our the the amount of water that we do draw as i kind of as i said there and said when we talked about this at the commission, my thought is that anson moran kind of was very clear in terms of there's no limit to how conservative we can and must be when we're thinking about our prep preparedness for droughts we can never run out of water period. and then the other side is the notion of take no more than we

need and where we land in between those two considerations and is kind of what i said you know in the right spot with respect to obviously the fact that we can never run out of water impact on salmon, impact on the environment, all these other components but when it came to treasure island, what i learned in kind of preparing for the meeting and spending time with the commissioners including at least one commissioner who lives on treasure island is that we don't own the treasure island electrical grid. we contract with the treasure island development authority but we do have a contract to to maintain to provide and propose upgrades to address kind of the long term planning for the island as kind of driven by the owner which is treasure island development authority and the work they plan out there long term to create as many as i want to say homes for 20,000 new residents over the years to come. but there's definitely there was a resolution passed that the citizens advisory committee

a year ago questions were posed to me that i quite simply could not answer but did commit to seeking to try to work with the our our hardworking team to to understand and to answer for the citizen advisory committee. i appreciate that our team was immediately responsive to my questions and desire to learn more and also desire to provide information in in in the form of responses to what's what has come from the citizens advisory committee. i know we've we've tried to provide information. i think what folks would appreciate would be kind of one the fact is that they've had five power outages already at that treasure island. it was four when i was there but i checked and there was another one since i was there in that time. so it at five power outages at treasure island for this year that puts them on pace for 30 at the end of the year that

would be a record four for power outages at treasure island last year was 23 so i did commit to trying to understand again with the acknowledgment that we don't own the asset we are a partner but what are our ideas that we can proffer to treasure island development authority who it appears to me does have resources to make some investments or short term and certainly for long term solutions i would like to under items initiated by commissioners i would like to initiate that conversation again with expressing both the limitations in terms of what we can do not owning the grid and also expressing appreciation all the work that our team has done over the years and then even in the week that i brought this to our team's attention, the appreciation for the dialog i've gotten i committed to the cac that until such time as we do have a written response back to the resolution i'm going to go to the cac every month and just share what i know as a member of this commission as as the ratepayer advocate and hope so that can help us kind of move the conversation in terms

of again short term solutions that we can offer up to those who have the ability to green light our team to do something about it as the non-owner but partner with the island and certainly to help understand what are the long term ideas here at the island. >> i just i feel like we don't want to be here at the end of the year and if we do see a record number of power outages at treasure island, i think we'll all be well served by what i'm trying to initiate today which is kind of how we can kind of get ahead of that for the residents of treasure island and the city. >> thanks. thank you, commissioners. madam secretary, i think we should take public comment on these items. >> remote callers please raise your hand if you wish to provide comment on this item. are there any members of the public present who wish to comment? seeing none. moderator this one there there

are no callers with their heads raised. thank you. thank you. could you please read the next item? >> item 18 motion to on whether to assert the attorney client privilege regarding the matters listed below city and county of san francisco versus pacific gas and electric company motion to assert their attorney client privilege regarding the matters just discussed or just brought up seconded and i think we should take public comment on the whether to go into closed session and on the item i'm sorry did we do that already? >> okay. >> thank you. okay. we have a motion and second commissioners president stacy i am vice president r c i commissioner exam da high commissioner level ernie all right the item passes.

>> thank you ,we're ready and we are back in open session. and i would like to announce that the commission took an action action to recommend that the board approve the settlement referenced in item number 18. and now commissioners, we need to consider whether we should disclose our attorney client discussions during the closed session. >> i move that we do not disclose second thank you. >> president stacy i. vice president r.c. i. commissioner jammed our high commissioner level roni i. the item passes.

>> thank you. and now i'd like to adjourn the meeting. in honor of effects crowley and i know commissioner leave roni you wanted to make some remarks about that adjournment. >> i just like to make the motion to close meeting today and honoring a memory of francis xavier crowley all known in the city by x crowley former s f p u c and dedicated son of san francisco promoting san francisco through all his dealings with labor, with all the commissions that he sat on and served on and he always did so so selflessly and in the best interest of his fellow residents and businesses of san francisco. >> thank you. we are so adjourned in honor of access effects. >> crowley thanks

- >> we are doing is filipino and mexican cuzeen. the main component the

filipino style meat originated. we grew up on that. the most popular items are burritos. we have really something for everybody. we have a salad, we have tacos, we are natcho s and-trying to create something quick and casual, something you can get anything any time. for me i love food and didn't want to be a chef. i was in the business side of it and bring something special to san francisco so why i reached out to my business partner gil and he wanted to partner for food and we share a passion for food that comes from our parents cht it was a honor for us to be able to do this for ourselves and also for our parents and you know, our families. for us to have a business as

thriving here in san francisco, such a honor and makes me feel proud of myself and of my city as well. just to be able to add to this city that is so special. we are just a speck of the specialness, but you know, to have any part that is just a honor. >> i am supervisor melgar. i am the supervisor for district 7. [music] i am a immigrant to san francisco. my family came when i was 12 from el salvador during the civil war. this place gave us security, safety and an opportunity to thrive, so i love the city deeply, and as a mother of three

kids who have grown up as city kids, i'm grateful for everything the city has to offer for people like me and families. i have been politically involved my whole life, either in government or a non profit worker and i care about the community. i care about people around me, and i want to make sure that as the world changes around us, other people have the opportunity that my family did. >> we are back in san francisco post pandemic. so important to be out supporting our businesses, supporting our neighbors. >> i'm the first woman to represent the district, believe it or not. i'm the first latina elected to the board of supervisors without an appointment first ever, so i do think that (indiscernible) i want immigrants to be represented, women, moms, people that have different experiences because that brings richment to our decision making and i think it makes for

betting decisions so that inspired me to run. district 7 is one of the most diverse districts in san francisco both in economics and ethnicity. it spans north from golden gate park. it includes all the institutions in the park, the wheel. the music concourse, mew seem to the south to the daly city boarder and west to the organization. includes the zoo (indiscernible) all those fun things and to 280 oen the east. includes city college, san francisco state. i had ucsf parnassus so very large geographically. it is mostly single family homes, so it is the place where for generations family (indiscernible)

nice parks, lake merced, mount davidson. >> this is like a village within the city, so we are very close nit community. we tend to band together and try to support one another and it is a friendly place and families and people to have a cup of coffee and check out the park. >> ocean avenue, which is the southern end of our district is vibrant commercial corridor that mostly cater tuesday the local neighborhoods and the students. as you go further west you have the mall which has some of the best pan asian food offerings in the city. if you haven't been there, it is really fun. as you go up a little bit further, there is west portal avenue, which is a very old school commercial district where you can still find antique shops and cobbler shops and as well as like more modern restaurants. it is definitely hopping and full of families on any weekday.

>> i'm matt roger, the coowner or (indiscernible) >> carl, other coowner in west portal. >> we are a neighborhood hardware store. been a community institution since it was founded in 1936. we had a little bit of everything. (indiscernible) to gardening or gift buying. >> my entire experience in san francisco is this community. it is a very small town feel for a big city. the community is caring and connected. >> what makes me excited doing business in district 7 is i know it sell well. i grew up here. i knew a lot of customers, parents of friends. it is very comfortable place and feels like home. >> if you go up north, you have the innerpz sunset commercial corridor which has a

awesome farmers market on weekdays and plethora of restaurants. there is everything you need. >> friendly and safe and (indiscernible) i love they bring their kids with them. they teach them how to use their money, and it is something you dont see in too many markets in other communities. i love to see the kids come and talking to you. it is something different then i see from (indiscernible) >> the ev access to transit in inner sunset and ability to do a lot of shopping on foot, and now the improved biking with jfk closed to cars, because we have a 4 and a half year old who rides her bike. we now have a safe place to go and ride bike jz don't have to to worry about traffic. >> graffiti continues to be one of these things that during the pandemic just got out

of control everywhere in the city and i do think that it is hampering our recovery of commercial corridors, so some of the volunteers on west portal avenue, some of the merchants got together with interns at our office to do some hands on abatement and we have been doing it regularly. we are doing it once a week and we have a wonderful neighbor, carrie organizing and storing the paint and supplies in her office on west portal, but this needs more then just a volunteer efforts. >> i'm grateful for the collaboration. we passed legislation at the board and put $4 million in the budget over the next 24 months to help the department of public works hire laborers and labor apprentices to abate the graffiti on private property on commercial corridors. i think that for a couple

years this recovery strategy so we can get back up as normal after this awful pandemic. participatory budgeting is a pot of money that is available every year for district 7 neighbors to propose projects that improve the neighborhood and the district. anyone, any organization in the district can propose a project and then it's a vote. it is popular vote. we have 14 projects just approved and they span from you know, a vegetable garden at aptos middle school to pedestrian safety projects on (indiscernible) it runs the gamut, but it is wonderful because it allows people to be engaged in a real way, and then to see the outcome of their energy and work, because the things get improved in front of

them. >> i like it is really close to the parecollect parks and bunch of businesses as well as a calm feel. it is a very peaceful feel even though it is close to a lot of things. (indiscernible) also not boring. there is stuff to do too. >> so, there is lots to see and experience in district 7. [music]