Transcripts For SFGTV PUblic Utilities Commission 42616 2016

SFGTV PUblic Utilities Commission 42616 May 2, 2016

To call the meeting of the Public Utility Commission for San Francisco to order. Mdm. Sec. , can you please call roll. [roll call] the next order of business is the approval of the meeting of march 22, 2016. I move. Seconded. All those in favor say, aye. Opposed, nay. The Meeting Minutes are approved. The next order of business is Public Comment. Members of the public may address the commission on matters that are within the commissions jurisdiction and are not on todays agenda. Camp may 3 is opening on may 29 we urge you to come and rest and have a good time and do not worry about anything. Bring all of your relatives and friends and is just a time to get away. Just do not forget. Camp mather starts on the 29th and and in august and we have a volunteer leader they are so make sure to say hello to them. And it is a time to get away and to rest and relax. Good wishes for the days ahead. We hope that water continues to be there on our agenda and we hope that you are there to help us in all of the directions that we go. Thank you very much, byebye. Thank you very much. Ive always heard that the parks are very good at taking care of kids. Any others . Mr. Dacosta. How are you all. I have not seen you all in a long time. There is a lot happening in the southeast sector there is a new commissioner and whether you like it or not they are a part of what is happening. I would like during the general Public Comment to talk aboutdr. Espinola jackson. Now that she is gone a lot of people call me. Having received hundreds of telephone calls i have no idea what is happening. I am not a telephone operator or secretary or whatever. I choose what i have to do and i focus on that. Right now there is some confusion about 1800 Community Facility Commission Building and what i would suggest is that a onepage fact sheet be put out there on exactly what we want to do with it whatever it is. The community is confused. It has become much more convoluted. I have direct access to the general manager and it is not his fault but it may have something to do with how we communicate and who ever is in charge of that situation in San Francisco, we have a facility that is supposed to serve the community and at that time the leaders were supposed to focus on education. In thhe year of 2016 we may think we could use it for Something Else or for another building or build it somewhere else or whatever but lets run it by the community because what i do not want to happen is some of those that want direct action i do not want direct action to take place. We need to have focus meetings where everyone is more or less on the same page. They may not agree but at least they can be on the same page. The commissioners cannot be doing things through Remote Control okay. [timer dings] i am here before the Public Utilities commission and and i am asking you this and i thank you for your time. Thank you. Any other Public Comment . Currently, this is a tool to define what disadvantaged communities mean. The impact of this tool is extraordinary. Let me emphasize that bright lineis a tool that has effectiveness but its effect on the bay area has not been good. It has transportation disadvantage, low income just by the way of example Alameda County only 32 rank as disadvantage and these are the community of san ratify out and san mateo is 22 and finally San Francisco most significantly48 would rank as disadvantage and only 3 under callan buyers screening. This commission has shown its dedication to it over the years and specifically in this last month recognizing dr. Jacksonwhose belief was that her community needed more and more resources because it was falling behind. The callan byers screening could be better as far back as 2014 under general managers kellys leadership to improve to make sure they a better leadership and to make sure this was analyzed. And finally that the efforts are worth looking at the find out how they could better be included in this pool. Thank you very much. Any other general Public Comment . Seeing none. We will move on to the next item which is communications. Commissioners, any comments or questions . I will turn the gavel over to our pres. Thank you. Welcome. We are on communications and i had a couple of comments. One is with respect to item 5e. First of all, i would appreciate the report from staff and i appreciate the usefulness and the candor that came along with the report. It shows the wisdom of our technology policy. It says we will push the envelope a little bit on Emergent Technology and we will test it on a pilot level before we recommend those to the city before we and barge on the building so im thankful for the technological all policy. The larger question had to do with an audit that the city controller did of the current practices in the city. The audit was quite critical of the citys procurement practices and the changes to those practices within the organizations as well and this is not something that is part of our jurisdictionso we do not have responsibility for it but on the other hand we buy a lot of stuff so we have a lot of interest in it. So the question that i really want to get to is do we as a city by the basic premise of the auditors report do we think that there are efficiencies needed in the procurement prior to and do we think that they are on the right track and if i can have at some point a response to those questions i would appreciate that. That is all my comment. Thank you that was communications. I see we have 2 Public Comment cards. Have we taken those . Okay, great. Thank you. Is there any Public Comment on communications . Hearing none. Next item please. Item 6 is other communication business im sorry, commissioner courtney. I do not believe that we mentioned this i was wondering that are in it mean we have more discussion about that . Yes. Thank you. Commissioner courtney. Thanks to all of your help and participation especially your general manager kelly, the folks out there with the help of the Mayors Office at the Workforce Development had converted a very, very, old, dated storage unit into a community classroomi just want to put it on the commissions radar and make sure that in the the you know the in the future that there arepeople participating in the education and participation components of thisthank you. Thank you so much for your leadership on that work. We really appreciate it. Any other business . Next item please. Item 7 is the report of the general manager. The 1st item is the drought update by stephen ritchie. If i can have the slides please. This is our reservoir storage levels. As you can see the water bank now has 1000 acres her feet of water and our total storage isat a 97 maximum. At this time a year this is usually at a 79 so theyre looking a lot better than they have in the last 4 years. We did on april 1 have a field reportand we covered this area with black balls as you can see here and i to commissioner come up and say when did we do that . And i had this completed by a professor at uc davis. The snowpack is having its particular pack downward this year so the weather is looking good currently. Upcountryof the numbers on the upper right are the ones to focus on here. They are more than the average annually at hetch hetchy the same is true for the bay area here as well for a bay area station. So, again this is a better than average year at the precipitation at the upcountry area and locally. Tuolomne water station if we have currently 800 acrefeet so we are just under completely full so we have a possibility of filling the entire system this year which again is a nice position to finally be in after these years of drought. Conservation people are continuing to observe. We had a hot spell a couple of weeks ago where actually the demand jumped up to 2015 levels and if we saw 2015 levels this year i think particularly eric would be happier because that would enforce something right now so the waters have come back down and people are getting concerned and that is true of some of our customers as well. Lastly, our state water board has adopted regulations in the past and they had a workshop this past wednesday about continuing those. Many water agencies are saying g, we have a lot more water the sheer c should back off some of these regulations. You should back off of those considerations of hat they have had this year. I think that will eliminate them somewhat but not completely eliminate them. Certainly in the drought. They will expect to act on 18 may. We will come back in may with potential modifications to what we are requiring of our customers here but certainly i think we are in the same boat and the matter what we do there will be nothing that we would say stop conserving. That would never be the message. We always have to conserve. We always have to confirm that next year could be a drop your. We will be happy to answer any questions. Commissioners . Thank you for the good news. Are we expecting any drought this year . Weve had 6 consecutive months of being above average except for one we been above average up there. Next order of business is item 7 b, ocean beach update by for the 2nd 3, if we set rates the way we recommended here we would need 330 increases to beat the cost of service by 2021. 3 additional, that was one of the issues that i wanted to bring up and i was hoping that we could come up with a timeline and a process in the guse rates as well. Im not sure how that was arrived at but im sure there could be an issue there and im not sure if we have to have a conversation with this but i would like to find a time to talk about these as we move forward. The 2nd is the question of the reserve policy which i believe is important. You put out a 60 million figures so some thoughts or ideas on how we make it to that as well. The 3rd is the question which i really do not quite understand but is the 1989 resolution on setting the standard rates. It seems as though was a long time ago and i imagine that is due for every visit. And then the 4th is the question of the cost of service and how we can get there. I think all of those are going to have a lot in them and they should be part of the Business Plan if not a separate time that we really put aside to try and analyze that and see how we can get that to a more comfortable level. Was there a thought of increasing it more . The general rates or the guse rates . Yes, of course, always. Given the fact that you look around and you look at all of the construction going on and you think that the city is doing well and unfortunately the city departments and the city was asked to take a budget cut of one and a half percent and it was based on 3 items. One was the mortality rate was higher and the 2nd was losing the lawsuit and although we are showing this timing of asking of this was timing. So, we asked anyway and i think that you know, i think the mayors budgetoffice is more accepting of doing a longterm commitment than during a transition which i think is significant if we can get a commitment and then the next thing is to make sure that they follow the commitment and hopefully we can do that within this present administration. Commissioners, anything else on this item . So, there is no action right now. And, we will be taking action at the next meeting. Yes. And, we also have kevin chong from the rate fairness board to present their perspective o our proposal. Is that right now . Yes. I have a question. What is your timing . I think we have a game plan. It seems like we have some recommendations before is that we can think on on the next month before we vote. I dont think any of these 4 items would prevent us from taking action on this item but i think in the next 2 years we need a game plan to help better understand what we might need to do on those 4 pieces to bridge some of that financial gap as well as visit some of the policies that need to be updated. I think it fits very well under the financial plan. Commissioner, one thing that i think may be helpful is that some of those issues are going to take a wild to work out. I think by our next meeting we are not going to have everybody on board with all of the information we need to have. I would like to have some expression of the resolution of if i would adopt the direct staff and i dont know what the exact language is but we have a ways to figure it out but basically the direct staff can develop that plan in a way that gets us to recovering the cost of service over a reasonable period of time. The way that is written now it is basically saying this is the 1st 2 years and we will deal with the rest as the time goes on. I would like the resolution to say here is the 1st 2 years and we recognize theres more work that needs to be done and we are committed to doing it. And, the goal of the recovery of cost of service being written in their. That would make a lot of sense. Also a timeline that we would hope to accomplish that. We went through that in the slide. Low good afternoon. My name is kevin chang my name is kevin chang i am on the rate fairness board. What you reached in 5 minutes of discussion it took us 5 meetings and we would like to give you the benefit of those discussions. Just as a way of background as cfo sandler mentioned earlier the independent rate study came as a result of a requirement and our role as the rate fairness board came as a result of prob b. The rate fairness board is more art than science and coming to a conclusion as to whether or not these rates are fair. We can have some discussion as to whether these proposed rates are fair as we dive into out different classes are paying different rates. This is a little bit hard to read but here are basic observations as the rate fairness board. 1st just on the study itself the board believes that it has been thoroughly by both the staff consultant analysis and communication have eliminated different ways that customers can pay and how the rate can be set and more communication wi the board and the public. We think the staff has taken great effort to make sure the information is available to the public. As cfo sandler mentioned, the staff recommendation and the consultant recommendations are just book and as how we can bring the entire enterprise into the cost of service. The key difference between the consultants presentation and recommendation of staff is 1st of all it brings our resources of cuts to a 10 year power plan. The recommendations currently would not bring us the cuts that we proposed in the past. The set proposals would not reflect what is recommended by the consultant for best ractices. And also we see these dramatic increases on rates 3, 4, and 5. We saw this kind of chart earlier by cfo sandler on this proposal issue but as far as the residential rates this yellow line represents pg e. Red line represents the cost of service. The green and light blue lines are the consultant proposal and the staff proposal andthe darker blue line is the current rate that the customers are being charged. If you move on to the guse or general fund customers you can see what they are being charge. If you look at the enterprise customers, those customers are being charged above the redline. If we look across all customer classes, i think the most important part is that is deftly well below pg e rates but the question of how we get the blue and green lines in line with the red is a challenge and its a challenge with the rate fairness board as far as giving a fair recommendation and it is a challenge with the commission on how they will adopt appropriate rates. Here are the concerns and issues that the rate fairness board has come up with after 5 sessions of meeting with the consultants and staff. The 1st is that the proposed half cent increase over the next 2 fiscal years is not sustainable. The nonguse will be way above the cost of service and the guse will be well below. And we do not believe this is one of the best practices for conserving. This is not where we will need to be as far as an enterprise of operation and if we dig deeper into the classes some customers we paying way more than they should be paying and others will be paying less. So the half cent increase is just not sustainable. The 2nd is that the the 2nd is that theguse rate customers need time to process this change. If the question is is this fair i think we know what the answer is. But how fast we make this and how deep and how severei think that is what we can say at this point as far as where fairness stands. One thing that we can say for the goosy customers is that we have looked at the water and sewer rates in the past and we have been able to adjust those rate increases since 2001. It is not that they have not went through this process before they have done it and done it successfully. The question is how and where over the next4 years going forward. So we recommend that they remain at the set rates below and we recommend that the consultant and staff come back to the rate fairness board and the commission to set rates for a threeyear and a fiveyear plan with the goal that we revisit the councils recommendations and that we gently increase the guze rates and decrease the nonguse. So thats what were saying right now im more detailed plan and then to call back the board to set these rates and then thats what we would recommend to you for years 3, 4 and 5. The next is that we wanted to touch on the power enterprise rates for the next 2 years as well. Thank you. Can i ask you a question on something that you said and i didnt really see it in your set of recommendations here. And, we did not really talk about it and that is restoring the cuts of the past question. Because, you are primarily focused on the cost of service but in a perfect world, we would go and above and beyond that, right . We would not only go above and beyond the cost of service but we would discuss past cuts and there is some restoration we would have to do in the community. Did you look at that . We did. These were proposed in the general plan. These were staff recommendations that were prepared prior to the rate study. We were assured that these were not fine all of the immediate enterprise andthey would not jeopardize the immediate enterprise and ot only in an ideal road but that these cuts do need to be restored but the question is when and how. I would like to add that as a 5th item if possible and if there is a capital line or some other line and if there is anything that we can plan for to restore the past cuts that may have been significant. I do not know about restoring past cuts because we are not for profit. We actually defer projects so one of the things that we would do is

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