Members of the public who wish to provide remote Public Comment on this item should dial star three on the phone or click raise hand in webex. Please note you will have two minutes. Do we have any remote Public Comments for this item . We have one caller. Thank you, um. Color your time begins now. Can you hear me again . We can hear you, mr. Pill pill . Yes. Great david. Fill pelican. So um, thanks for being the code of conduct packed for a second round today. I think the language is good. I had a couple of suggested. Edits on the paragraph on x party communications. Um i think it might read better if it says it shall be the policy of the refuge rate board for members to not communicate blah, blah, blah so that it its not whats against the policy, but says what the policy is, um, second point there, i would consider expanding that ban on communications to not just be with refuse companies but also with city departments that receive funds through the impound account with regard to use of those impound account funds, only to have a very narrow ah limitation there because it just seems like that might be useful. Um and in the paragraph on ethics rules. The first line. Sorry the second line that the first sentence actual and potential conflicts of interest instead of must say , and shall publicly disclose such matters as required by city law and policy. And those are my three suggested at its rear consideration. But the language here in general is good and my suggestions were merely to buff it up a little bit. Thanks for listening. Thank you, mr pill pelt. Um do we have any additional colors online who would like to give Public Comment on item three. There are no more collars. Um chair chew. This concludes Public Comment on item three. Thank you very much clerk stone for the Public Comment, um, given that we have a discussion or action item on this item, i want to appreciate the public. Uh, commenters recommendation. I think that the policy as its written is appropriate. I do believe that from time to time we may want to seek information from departments in the course of this process just to make sure that we understand pieces, so im not going to suggest that we amend. That, of course, will work closely with j to make sure that that occurs inappropriate manner. So colleagues. Do we have a motion on this item . I would move to approve. Okay theres a motion to move it and i will second it and well do a real call. Okay well do a roll call vote, um, chair chew. Yes. Uh in member core. Ivanova . Yes. Thank you. Thank you. Its been passed. We will move on to item number four, which is a presentation of the refuse Rate Administrators report and recommended rate order. Thank you. Church ooh, four is the presentation of the refuse Rate Administrators report and recommended rate order. This is a discussion item only presenters may begin with their presentation when ready, and i believe well start with opening comments from the deputy comptroller. Good morning chair , chew and member corvin nova, um and also general manager and member um herrera on the line. Its a pleasure to be before you here today. Todd rystrom, deputy comptroller. Ive been working on a number of these items and about 2020 with ecology and the refuse cos im here in San Francisco, and we made a lot of Good Progress and covered a lot of ground that said, i believe theres also a lot of ground yet to cover and so later in the presentation today, youll hear from refuse Rate Administrator allow about planned work that we have scheduled. Um over the coming 12 to 18 months in particular. Um i would also like to say that its been very good to work with ecology, as well as dpw department of environment and also the department of Public Health department of Public Health service of vital function wherein they serve as a sort of a bureau of delinquent revenue, um, for unpaid refuse bills that are Public Health necessity required Service Levels in the city. Um and that makes them the relationship as well, unique as well, because it also helps cut down on, um on bad debt or or uncollected bills. The rate before you here as youve discussed briefly in your first session as well is a two year rate request and the refuse rate administration office. We established it very quickly after voters mandated that it be moved to the Comptrollers Office in june of 2022 fully staffing it by late fall. 2022 and id like to acknowledge in particular jaleo as well as ben becker for their great work and bringing this and ramping ramping up. Ramping up is a lot of detail as the members on this on this body . No and so theres much done and theres much it to do. A couple of areas that shell hear about it towards the end of mr laus presentation, i think will interest the rate board in particular. In addition to that, our offices, finishing also a planned Public Integrity report on the landfill disposal agreement, and so in coming weeks, we plan to issue that as well. And thats of note because the proposal before you for your deliberations includes the assumption of the terms and conditions extended under that landfill disposal agreement. Which leads me to say that there may be opportunities mid cycle or in early 2025 to revisit various provisions as well, um, for the rate order. Requires us to have no less than two years no longer than five years, and so questions like that, including cola, or automatic escalation. Provisions are some of our outstanding questions that wed like to review and consider with City Attorney as well as others as far as whats permissive and whats limited, given the way the property was written. So with that, ill turn it over to, um, um, mr lau and, um look forward to helping with any questions. Morning uh, church, chew, uh, number corbyn nova. General manager herrera and member herrera. J. We refused rates administrator with Comptrollers Office. Can we pull the presentation of. So for this agenda item weve broken out into a few parts, the first part of this presentation as a standing item. Its the refuge Rate Administrators report, which serves as a process update for the board. Quick update the second part of the presentation. Ill lay out our recommended great order. Weve issued proposed rate changes through the prop 2 18 notice. But we have not issued the written rate order yet. So we anticipate that will be ready before the next hearing on june 20 6. However the content in todays presentation will represent essentially the whole of our recommendation for the right order. The board can accept, reject or amend any parts of our recommended recommended rate order. But because of prop 2 18, any changes cannot exceed ecologies proposed rates. If the board is considering any amendments to the reorder, we can present impacts the next rate hearing on june 20 6 for board consideration. Um the way this presentation of structure it all first summarize that high level both colleges proposed in our offices. Recommendations will then move into presentation. Details on the proposed items with right impacts. Ah a pause after our presentation on the impound account detail and allow , uh, department starting with public works than environment than ecology, uh, to make a present or make comment, and afterward college e. We like to invite general manager herrera to comment as well. Uh ill finish the remainder of the proposed items with right impacts and again, well do pause again for the departments for ecology and general manager herrera to opportunity present and then the last portion of presentation proposed items without rate impacts again at the end of this will allow comment for the same groups. So this is a quick summary of the work that weve done since our last meeting. Uh after the, uh our our schedules were issued , and rick ology sent their submission in march. 7th weve been conducting an analysis and building our Public Record, which includes hiring hf and Hr Consulting from the support some of this analyses, particularly the rate comparisons and profit margin comparisons. The bulk of the work, however, is really in the right changed the mission analysis. Um then the Public Record building weve done to public workshops for Commission Hearings to refuse rates, administrator hearings one Board Hearing and then, uh, including this here, including this meeting, there will be an additional 3 to 4 refugees rate Board Hearings for toilet 12 13 opportunities for oral public input. And then we have our interrogatory process where weve been submitting. Formal requests to rick ology and receiving formal responses since march, 7th. Weve had written objections open and we continue to collect those and then propped to 18 notices were sent june 1st tall Residential Ratepayers. Weve been receiving some, uh, some protests since then. Uh in terms of Public Outreach, weve been continuing our public website or email campaigns. Social media, we have the prop 2 18 mailers, Public Records off automation on next request. Weve targeted neighborhood papers as well as outreach to registered neighborhood organizations. Upcoming i think after the release of our rate order, therell be a press release an additional email campaigns. Ah this is just a summary of, uh of written comment or public input to date. Weve had 55 written comments or objections sent Elektronik Lee through our online form. This is related to the prop f common or objection. Um. 45 of them are related Residential Rates one commercial nine related to both all comments, object to any increase in rates are in favor of the refuse Rate Administrators proposal. Just a sampling of some of the comments related to, uh some of the some of the themes that we saw. One is that we call it should not be trusted with increase in repair funds after the corruption scandal, ecology received an 8. 86 Automatic College just mint in january and should not increase rates again. And then there were a few comments in support of our offices proposal. During public hearings and public workshops. Weve had one Public Commenter, mr pill powell. This is just a sample of some of the comments he has made a request for more information on impound account, concerned about nexus and portrait proportionality on use of impound account funds. He said that he would support a proposal that would minimize contamination and maximize diversion and wants to see reasonable fair rates good value to repairs and supports profit. The current profit margin would expect some increase in rates. Uh are proper to 18 protests are the letters are beginning to arrive. I think we have three to date. And the hearing for the proper to 18 protests will take place. Uh, july 20 4. Um as part of our role we need to bring commission. Uh comments from the commissioners from the street and Sanitation Commission as well as the, commissioner environment. Uh so its the first hearing for sanitation streets and Sanitation Commission was mostly around clarifying questions on how rates are set drivers of the tipping fee increase. Um commissioners recommended additional outreach on rate setting process which we did, um, second hearing, um we did a presentation on the impact of the stop they requested comparison with ecologies aesop , structured with other types of Solid Waste Company structures, something that will look into the next rate cycle. Uh and then also since rates are based on projections, ensuring troops with actuals, this is something well be doing as well. The Commission Environment focused on a few areas in the first hearing again, more questions clarifying questions around profit incentive to manage cost how tenants reporting is validated. How they impound count is set and the use of the zero waste and 70 funds how theyre approved, and one commissioner supported changing zero. Waste incentive. Next trick from tonnage 2 recovered. In the second hearing, we focus more on Certain Program enhancements. Uh with the contamination. Hanse mint will go into some detail later in the presentation, but there were concerns and support express for potential Camera Technology. Onboard cameras on the trucks. There is concerned focus concerns focused on privacy, the efficacy of these cameras, lack of tests and potential litigation. Uh with the zero waste incentive account. One commissioner supported incentive as a various forms while expressing skepticism on the efficacy of outreach, another Committee Commission noted the current structure does not correlate with diversion. But in general, there was general support for some kind of incentive structure. Uh, compost contamination. There was general concern for the level of contamination. 24 was found not readily compostable, and then we can clean up they supported current. We can claim does not include recycling or composting bins, and, uh, this group supported, including those bins and reused component for the neighborhood cleanup program. Lastly ill note that they passed a resolution that encourages an adjustment that helps the 2030 0 waste and climate related goals. This included ah testing of truck cameras. Reinstatement analysis of contamination charges, processing of organics testing and evaluation of new technology. Outreach to residents tested evaluating the trash processing, um, establishing zero incentive account with annual recovery targets and then supporting the funding through the impound account of environments. Uh, proposed impound budget. Um the next slide here is a summary of our interrogatory process where we submit a formal request by email to recall aji and receive formal responses. Schedule requests are updates to the schedules that we submitted. We made 17 of those 12 of those responses were completed as of last week. Exhibits weve requested 40 exhibits and have escaped 39 to date and then 100 56 questions, mostly clarifying questions around assumptions in order 45 responses since then. Since last week. And then this is the remaining rate process of todays hearing. Youll be hearing the summary of our proposal. Uh we plan on issuing are written report week of june 18th ahead of the next hearing. June 20 6. Uh um, this will be, uh, the boards official hearing of the refuse Rate Administrators proposal. Um well, also, if the board has any amendments or changes they would make to this proposal that were proposing. Today we can present any of those analyses of any of those adjustments that hearing um. July 15th will be closing the prop effort and objection to allow the, um our office to analyze and organize and present and be able to present the those objections to the board for the july 20 4 hearing where again, we can hear the proposed rate order prop effort and objections and then prop 2 18 protests. July 20 8 is an additional hearing if needed. So this next part of the presentation. Ill introduce our offices, proposal and comparison colleges proposal uh, before i go into this presentation, i do want to reiterate what deputy comptroller reached from had said that, uh, weve, uh, this process uh, his gone really well part in no small part to the responsiveness from the departments environment and public works as well as the ecology. Um, its been a good working relationship. Um i also wanted to draw back on proposition f, which establishes four principles. That service will be Cost Effective rates will be reasonable and fair that the process will be transparent. And that the work of our office will be conducted with high professional ethical standards. I believe that weve adhered to these four principles. Our team has worked hard to make this process transparent to make sure every deliberation that impacts rates is presented in public forum and part of the Public Record. And that all information is publicly available or analyses of costs and have jurisdiction. Comparisons leads us to believe that the rates were proposing are reasonable and fair. And the changes were proposing should only improve service delivery. Given the time constraints for this rate setting process. There are many other areas. We were not able to make recommendations, and weve outlined the analyses to be performed in the next right cycle. Um we and we about mind set of additional reporting requirements we believe will set us up to address some of the issues we plan on tackling over the next couple of years. Uh so this is our high level are rate change proposal . Um uh huh. The i should note that the collections rate is inclusive of the tipping free feet increase its including and so the bottom half of the table shows the tipping fee increase. Um thats internalizing the collections rate and what youre seeing is colleges proposal in the first year right year 2024 is a 3. 9 increase in rates are offices present present, proposing no change. Uh second year, right . Youre 2025, or ecology is proposing additional 2. 17 increase our offices proposing at 3. 92 increase. The accumulative percent change for colleges proposal the 6. 15 our proposal. No change first year, so the community cumulative change would be 3. 92 across both rate years. Um just kind of a quick summary recall a jeez the major drivers of some of the changes they havent contamination enhancement. Where there ah, adding some expenditures to enhance their contamination. Uh mitigation work. Uh included in this, though, is an assumption of additional 5 million revenues through contamination fees. Another major driver was the closure of sustainable crushing site and actually write your 2020