SFWATER.ORG : Article - 10/14/08 Minutes San Francisco Public Utilities Commission

10/14/08 Minutes San Francisco Public Utilities Commission

Published: 11/05/2008 | Updated: 11/06/2008
Published By: Commission

MINUTES
REGULAR MEETING
Tuesday, October 14, 2008
1:30 P.M.
City Hall, Room 400
1 Dr. Carlton B. Goodlett Place

COMMISSIONERS

The Honorable Ann Moller Caen, President
The Honorable F. X. Crowley
Vice President
The Honorable Francesca Vietor

DEPARTMENTS AND ENTERPRISES
Water Enterprise
Wastewater Enterprise
Power Enterprise
Infrastructure
Business Services
External Affairs

Gavin Newsom
MAYOR

Ed Harrington
GENERAL MANAGER

Michael Housh
SECRETARY

ORDER OF BUSINESS:

1. Call to Order: 1:43 P.M.

2. Roll Call: Present – President Ann Moller Caen, Vice President F.X. Crowley and Commissioner Francesca Vietor

3. Approval of Minutes

Moved by Vice President Crowley, seconded by Commissioner Vietor to adopt the Minutes of the September 23, 2008, Regular Meeting; passed (3-0 Caen, Crowley and Vietor) unanimously.

4. Public Comments

No comment was offered.

5. Communications

There was no discussion of communications received.

6. Commission Business

President Caen asked about use of 2.4 million as the number of water customers served by the SFPUC observing that this figure had remained unchanged since she joined the Commission in the 1990s. General Manager Harrington noted that he used the figure 2.5 million and proposed to determine the current number served and inform the Commissioners.

7. Report of the General Manager

General Manager Ed Harrington announced that Tommy Moala has been selected as the permanent Assistant General Manager of Wastewater. Mr. Moala humbly accepted the Commissioner’s congratulations and thanked them for their expression of confidence.

a) Water System Improvement Program Report (WSIP)

Water System Improvement Program Manager Julie Labonte briefly outlined ongoing WSIP activities beginning by highlighting the upcoming Planning Commission and San Francisco Public Utilities Commission approval of the Program Environmental Impact Report and related Program at hearings on October 30, 2008. Ms. Labonte described in some detail the next steps in the approval of the Program Management Consultant Contract process.

Ms. Labonte then discussed progress on: the New Crystal Springs Bypass Project noting four bids were received for this project; the Baden–San Pedro Valve Lots Improvements; the Tesla Treatment facility; the Harry Tracy Short Term Improvements, and the Lake Merced Pump Design process.

Next turning to regional projects, Ms. Labonte described the current status of the San Joaquin Construction Management Contract and the issuance of an RFP (request for proposals) for the Sunol Regional Construction Management Contracts. Mr. Harrington noted that it was very good news to see so many projects beginning to move forward.

b) Business and Finance Report

Assistant General Manager for Business and Finance Todd Rydstrom presented an overview of a revised format for presentation of financial reports to the Commissioners. See attached: (https://infrastructure.sfwater.org/fds/fds.aspx?lib=SFPUC&doc=353631&ver=1&data=136147935 )

Mr. Rydstrom began with an overview of the Water Department explaining in detail each of the reported figures, actuals as well as budgeted amounts, and then explained what these figures meant for the FY 2008-09 Budget. Mr. Rydstrom stated that the reports showed that the SFPUC, in debt service ratios and available fund balance available, was in good standing. Mr. Rydstrom then discussed the revenues and expenditure of the Water Department.

Turning next to Wastewater, Mr. Rydstrom reported the fiscal impact of lower use and thereby reduced volume charges were covered by planned savings so that at the end of the year income and expenditures were in good standing. In response to a question by Commissioner Vietor concerning the debt service ratio policy, Mr. Rydstrom further explained various ways employed for figuring debt service ratios for the agency. President Caen asked if this was the same for all enterprises? Responding, Mr. Rydstrom discussed the policy decisions underlying the differences.

Next, Mr. Rydstrom discussed the Hetch Hechy report showing a net 3.6% increase over estimates. Responding to a question by President Caen concerning the Treasure Island Authority paying their power bills, Mr. Rydstrom reported current bills were up to date and that discussions were underway to arrange payment of the balances owed. Additionally President Caen asked why the charges for Groveland and Livermore were not budgeted. Mr. Rydstrom noted that he did not have an answer to that but would look into the question and provide the information on each of those items to identify every single source and use.

In response to a query by President Caen regarding Item F, Mr. Rydstrom explained these were related to the Williams Settlement. Mr. Rydstrom noted that the reserve funds available, while respectable, would be tapped to respond to as yet unidentified capital needs. In answer to a question by Commissioner Vietor concerning the lack of a line item showing use of reserve funds, Mr. Rydstrom noted that in this case no reserve funds were needed to meet the expected cost.

In answer to a question by President Caen concerning the variances in Power and Water sales, Mr. Rydstrom reported that everything in Water, Wastewater, and Power ended up roughly where they had been expected although in some cases these fiscal results had been achieved through different revenue and expenditure outcomes than had been expected. In addition, Mr. Rydstrom noted the beneficial uses of the CREBS (Clean Renewal Energy Bonds) financing mechanism, the new biweekly overtime reporting, tighter management of SFPUC telephone use, and gains made through closer watch on power usage by city departments to encourage greater conservation, Mr. Rydstrom next presented an overview of the Water System Improvement Program from the perspective of its budget, and the projected need for new spending authority in the next two budget cycles. Concluding, Mr. Rydstrom outlined tasks involved with the upcoming work of the Business and Finance staff.

Mr. Rydstrom explained he had rounded numbers by column in response to a question by President Caen about the reported numbers. Mr. Rydstrom explained in answer to a question by Commissioner Vietor, that staff would provide details to better highlight differences in use. President Caen applauded this new format, in particular calling attention to the extensive and useful footnotes. Vice President Crowley commended the depth of detail presented and agreed it was very useful.

8. SFPUC Citizen’s Advisory Committee (CAC) Chair’s Report

a) Update report by Citizen’s Advisory Committee Chair Alex Lantsberg.

Mr. Lantsberg presented a brief report due to the limited numbers of CAC meetings that had occurred over the summer. Mr. Lantsberg welcomed Commissioner Vietor lauding her deep experience in issues of great concern to the CAC. In particular, Mr. Lantsberg urged that the Commission go forward in implementing an Environmental Justice Policy as a key element in its future planning.

CONSENT CALENDAR

9. All matters listed hereunder constitute a Consent Calendar, are considered to be routine by the San Francisco Public Utilities Commission, and will be acted upon by a single vote of the Commission. There will be no separate discussion of these items unless a member of the Commission or the public so requests, in which event the matter will be removed from the Consent Calendar and considered as a separate item.

Moved by Vice President Crowley, seconded by Commissioner Vietor, to adopt the following resolution; passed (3-0) unanimously.

a) Resolution No. 08-0180:
Approve the plans and specifications and award Enterprise-funded Contract No. WD-2586R Job Order Contract, General Engineering (A-License), San Francisco/ Peninsula/East Bay to Hetch Hetchy, to the lowest qualified, responsive and responsible bidder, M. Hernandez Construction.

REGULAR BUSINESS

10. Discussion and possible action related to approve Water System Improvement Program (WSIP)-funded Project No. CUW39101, Baden and San Pedro Valve Lots Project; Adopt the Initial Study/Final Mitigated Negative Declaration (IS/FMND), the required California Environmental Quality Act (CEQA) Findings, and the Mitigation Monitoring and Reporting Program (MMRP) for the project; Authorize the General Manager of the San Francisco Public Utilities Commission (SFPUC) to include in the upcoming supplemental appropriation an amount of $25,052,261 to fund the project construction; and Authorize staff to implement the project following final action by the Board of Supervisors, provided that the Commission later awards the construction contract for the project.

Ms. Labonte briefly outlined the importance of this project. President Caen applauded the thoroughness of the Planning Department’s review. Commissioner Vietor called attention to the efforts made to mitigate that were carefully considered.

Moved by Vice President Crowley, seconded by Commissioner Vietor, to adopt the following resolution; passed (3-0) unanimously. Resolution No. 08-0181

CONSTRUCTION CONTRACTS

Award

11. Discussion and possible action related to approve the plans and specifications and award Water Enterprise Water System Improvement Program-funded Contract No. WD-2498, New Crystal Springs Bypass Tunnel in the amount of $55,674,000, to the lowest, qualified, responsible and responsive bidder, Shank/Balfour Beatty, J.V., and adopt Findings pursuant to the California Environmental Quality Act (CEQA).

The WSIP Manager noted that four bids had been received, the winning bid was below projected estimates, and there were no bid protests.

Moved by Commissioner Vietor, seconded by Vice President Crowley, to adopt the following resolution; passed (3-0) unanimously. Resolution No. 08-0182

PROFESSIONAL SERVICE CONTRACTS

Award

12. Discussion and possible action related to approve the selection of MWH; award Agreement No. CS-924, to provide As-Needed Water Quality Services; and authorize the General Manager of the San Francisco Public Utilities Commission to negotiate and execute a professional services agreement with MWH for an amount not to exceed $2,000,000, and with a duration of five (5) years, or, in the event negotiations are not successful or City requirements are not satisfied, to negotiate and execute a professional services agreement with the next highest ranked proposer.

In response to questions by President Caen and Commissioner Vietor, AGM for Water Carlin and AGM for Infrastructure Kelly explained the functioning of the “multiplier.” used in awarding this contract

Moved by Commissioner Vietor, seconded by Vice President Crowley, to adopt the following resolution; passed (3-0) unanimously. Resolution No. 08-0183

13. Discussion and possible actions related to approving the selection of Environmental & Construction Solutions (ECS) and CM Pros; award Water Enterprise Water System Improvement Program-funded Agreement No. CS-939, Program Controls for the Water System Improvement Program, to provide specialized program/project scheduling, Critical Path Method (CPM) scheduling, forecasting, change control, cost control, cost estimating, Primavera-based Program Control system administration and integration for capital improvement projects, and other Program Control related services; and authorize the General Manager of the San Francisco Public Utilities Commission to negotiate and execute professional services agreements with ECS, and CM Pros for an amount not to exceed $9,500,000 each, for a total of $19,000,000 and with a duration of six (6) years, or, in the event negotiations are not successful or City requirements are not satisfied, to negotiate and execute professional services agreements with the next highest ranked proposer.

President Caen announced that voting on a and b would be separate.

Assistant General Manager Harlan Kelly explained why this item was structured to separate approval of not only various types of program controls contract “a” that had no protest and contract “b” that had received a protest.

Mr. Kelly outlined how the panels were structured, how the scoring was done, and how the decisions had been arrived at as outlined in the Requests for Proposals.

Public Comment:

Mr. Ali Altaha commented in response to a question raised by President Caen that there had been problems with this contractor with a contract on the 4th Street Bridge contract. Mr. Altaha then read sections of a June 2007 Report outlining problems with this contractor’s work. He urged that the Commissioners look into this contract dispute before going forward. Additionally, Mr. Altaha suggested that the panel had not fairly adjudged the qualifications of the various firms.

Mr. Kelly and Deputy City Attorney John White both expressed the view that this issue had nothing to do with the matter at hand. Additionally, Mr. Kelly in response to a question by President Caen and Commissioner Vietor, cited eight years of very successful work with this firm in particular with their work as part of the Parson’s contract. In response to a question by Vice President Crowley, Mr. Kelly explained the ratings as they were posted by the panel, noting that the top two contenders were consistent across the board. Mr. Kelly noted that an impartial panel had been chosen and that the panel had made its decision in accordance with the requirements set forth in the requests for proposals. Commissioner Vietor noted that staff had expressed confidence in this firm’s ability. President Caen suggested as this was the case there was no reason not to move this item. Vice President Crowley agreed noting the scoring in this matter was clear.

a) Approve the award, and authorize negotiation and execution of an agreement with Environmental Construction Solutions (ECS).

Moved by Vice President Crowley, seconded by Commissioner Vietor, to adopt the following resolution; passed (3-0) unanimously.

b) Approve the award, and authorize negotiation and execution of an agreement with CM Pros.

Mr. Kelly, Deputy City Attorney John White, and Ms. Contracts Manager Ivy Fine outlined in some detail why each of the points raised in Mr. Altaha in his protest against award of this contract to CM Pros were without merit and recommended that the Commissioners approve the contract. It was reported that the Human Rights Commission had found CM Pros to be fully in compliance. Responding to a question by Commissioner Vietor, Mr. Kelly affirmed that staff was satisfied with its experience working with this firm.

Public Comment:

Mr. Ali Altaha suggested that the staff’s response to him had been deceptive and that the integrity of the program was the principle question here. Mr. Altaha then disagreed with the rebuttal to his protest made in a letter by SFPUC staff as well as challenged the integrity of the process used to award this contract and expressed doubt regarding the qualifications of the awardee as required in the RFP for this contract.

In response, Assistant General Manager for Infrastructure Kelly addressed Mr. Altaha’s contentions and recommended that the panel selection be sustained and the contract be so awarded. Ms. Fine noted that this was a staff augmentation contract with the work being spread out over six years. In addition, Ms. Fine noted that each of the requests for proposals for these contracts were customized to the job to be done so differences in how points were scored would be expected. Mr. Samir Messiah, President of CM Pros, affirmed that his firm had met the requirement that key members of the team were brought to the interview.

President Caen noted that in the end the scores told the story, and therefore, this item should go forward.

Moved by Commissioner Vietor, seconded by Vice President Crowley, to adopt the following resolution; passed (3-0) unanimously. Resolution No. 08-0184

CLOSED SESSION

14. Public comments on matters to be discussed in Closed Session.

There was no Public Comment.

15. Motion on whether to assert the attorney-client privilege regarding the matters listed below as Conference with Legal Counsel.

Moved by Vice President Crowley, seconded by Commissioner Vietor, to assert the attorney-client privilege; passed (3-0) unanimously.

The Commission took a break at 3:10 P.M.

The Commission returned and went into Closed Session at 3:21 P.M.

Present were President Caen, Commissioner Crowley, Commissioner Vietor, General Manager Ed Harrington, City Attorney Noreen Ambrose, and Commission Secretary Michael Housh.

16. Threat to Public Services or Facilities – Pursuant to California Government Code Section 54957 and San Francisco Administrative Code Section 67.10(a) (Ambrose)

Consultation with:
Agency Chief of Security concerning security of SFPUC Water and Power Systems.

No action.

17. Conference with Legal Counsel - Pursuant to California Government Code Section 54956.9(a) and San Francisco Administrative Code Section 67.10(d) (Rothschild)