MINUTES REGULAR MEETING Tuesday, October 28, 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: 1:34 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 October 14, 2008, Regular Meeting; passed (3-0 Caen, Crowley and Vietor) unanimously.

4. Public Comments

Mr. Steve Lawrence, retiring member of Citizens Advisory Committee, introduced himself to the new Commissioners and reported that he has been following the Water System Improvement Program (WSIP) since 2002. Mr. Lawrence then asked about two matters identified in URS Reports to staff he had read related to achieving level of service goals and related to the Bay Division Pipeline #4. Mr. Lawrence concluded urging approval of the proposed phased variant WSIP and moving forward quickly to get these critical projects going.

WSIP Director Julie Labonte responded to the Commission that a letter of response to Mr. Lawrence’s specific concerns was being prepared and a copy would be made available to the Commissioners.

5. Communications

There was no discussion of communication received.

6. Other Commission Business

No new business matters were proposed.

7. Report of the General Manager

a) Project Labor Agreement (PLA) Update

General Manager Ed Harrington introduced Labor Relations and Community Programs Director Carol Isen who reported on the Project Labor Agreement (PLA) that was approved in March 2007, a $2.73 billion public infrastructure projects program operating in five Bay Area counties. Ms. Isen called attention to the critical role that these public works projects played in sustaining our economy in these difficult times, noting 10.7 million skilled craft hours would be needed for these projects. Ms. Isen next pointed to the remarkable success achieved in this agreement in creating a productive framework to resolve many difficult and longstanding jurisdictional and work assignment issues that had impacted other large scale construction projects. Ms. Isen additionally noted the landmark nature of the scale of this labor agreement and the breadth of labor organizations involved in the agreement.

Ms. Isen next described the pre-qualification program which would keep the flow of potential bidders on our projects engaged and involved and ready to go to work as the program moved forward. Ms. Isen noted the WSIP Project Labor Agreement’s comprehensive drug use policy. Ms. Isen next pointed to and highlighted the built-in benefits that would result in the ongoing development of a skilled workforce of highly trained and experienced craft professionals throughout the expected life of this program. This local pool of skilled workers could then provide continuing benefits for future projects of this nature, Ms. Isen observed.

In response to a question by President Caen concerning the 10.7 million craft hours involved, Mr. Harrington noted the significance of public works expenditures on this scale in keeping the Bay Area economy going forward. Vice President Crowley commended Ms. Isen and her staff for their skill and diligence in making this landmark labor agreement a success.

b) Energy Conservation & SF “GoSolar” Update

Mr. Harrington introduced Barbara Hale, Assistant General Manager for Power, who presented an update concerning the SFPUC’s ongoing energy conservation efforts with its sister City departments and an overview of the great progress made since the adoption of the “GoSolar” Program last summer. Ms. Hale reported that progress was being made in reducing peak demand and overall energy use, promoting workplace safety and comfort, and meeting the Mayor’s Climate Action Plan goals by City departments.

Ms. Hale reported on the implementation of the Commission’s direction to go forward with simple measures such as incandescent bulb replacement projects and energy audits to identify areas where relatively low cost energy conservation measures could be put into place right away. In addition, Ms. Hale highlighted staff’s successes in encouraging City departments to draft and begin to implement Energy Conservation action plans with goals for energy saving. Ms. Hale next described memorandums of understanding between the SFPUC and sister City departments for ongoing focused efforts to promote energy conservation.

In response to a query by President Caen, Ms. Hale reported that with the Mayor’s effort to raise the profile of this issue, most City departments had been responsive but some still needed to be coaxed onward. Ms. Hale then discussed several of the ongoing projects at the SFPUC Southeast Treatment Plant, for the Port, at the Hall of Justice, relamping the Broadway Tunnel, at police and fire stations, and at the Main Library and individual branch libraries. Ms. Hale then discussed staff’s program of ongoing energy audits and educational efforts to encourage City departments to focus on saving both energy as well as their budgets through identifying and implementing energy conservation measures. Concluding, Ms. Hale commended the valuable contributions made by SFPUC Power Enterprise staffer Gary Oto in moving this program forward. Commissioner Vietor commended staff’s good work and asked if replacement of appliances and insulation were part of the program. Ms. Hale confirmed they were and then further described some City department energy conservation projects.

In the second segment of her report, Ms. Hale outlined the good start that had been made toward the Mayor’s and the Commission’s goals of expanding significantly solar resources in the City. Ms. Hale outlined the commercial and residential programs that were already producing a jump in City solar installations as well as encouraging the development and training of a skilled workforce in solar installation. In response to a question by Commissioner Vietor, Ms. Hale and Mr. Harrington described the numerous community outreach events and focused programs that staff had undertaken since the program was launched last summer. Responding to questions by President Caen and Commissioner Vietor, Ms. Hale then discussed how potential solar installers would access additional program benefits through use of firms linked to the City’s workforce development program to install their solar systems.

8. Bay Area Water Supply & Conservation Agency (BAWSCA’S) General Manager’s Report

(a) BAWSCA Update

BAWSCA Executive Director Art Jensen noted that everyone was preparing for the critically important WSIP Program Environment Impact Report (PEIR) approval meetings on October 30th. Mr. Jensen commented that this meeting was critical to all parties involved and urged that the Commissioners pay particularly close attention to BAWSCA members concerns with provisions related to replenishment of reservoirs during periods of drought. Mr. Jensen suggested that the staff proposal, while well intended, was not well thought out and could unduly lengthen duration of restrictions thereby adding to agencies’ burdens in dry periods.

Public comment: No comments were offered on the BAWSCA Update Report

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.

a) Resolution No. 08-0191:
Accept work performed for 5-Year CIP Program-funded Contract No. WW-424, Phelps Street, Topeka Avenue, and Pomona Street Sewer Replacement, by D’Arcy and Harty Construction, Inc.; approve Modification No. 1 (Final) decreasing the contract by $153,035.98, for a total contract amount of $1,864,191.02, and authorize final payment, in the amount of $218,442.90, to the contractor.

b) Resolution No. 08-0192:
Accept work performed for Wastewater Enterprise, Repair and Replacement (R&R) Program-funded Contract No. WW 451, Valencia Street Sewer Replacement, by Shaw Pipeline, Inc., for a total contract amount of $1,201,833.13, and authorize final payment, in the amount of $176,084.41, to the contractor.

Public Comment: There were no comments.

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

REGULAR BUSINESS

10. Discussion and possible action to approve a resolution urging San Francisco Board of Supervisors to enact two ordinances amending the San Francisco Housing Code and San Francisco Building Code to conserve existing water supplies by reducing the overall demand for water in residential and commercial buildings by requiring the installation of water conservation devices in all residential and commercial buildings. Resolution No. 08-0193

Assistant General Manager for External Affairs Laura Spanjian outlined how staff, following the Commission’s direction adopted during the approval of the Water Rates, had worked diligently to propose critical updates to the City’s outdated 12.a Residential and 13.a Commercial Code section’s water conservation requirements to encourage installation of water saving fixtures and appliances necessary to meet contemporary standards of conservation. Ms. Spanjian described staff’s discussions with concerned stakeholders about when to replace outdated fixtures and appliances when buildings were sold or extensively remodeled. Ms. Spanjian then outlined several of the challenges to finding the most effective point in time to make these needed improvements and described how staff had worked with commercial and residential stakeholders to identify the most effective and least disruptive timing to make them happen.

Commissioner Vietor acknowledged the challenges involved on the residential side with more that 200,000 pre-1995 residential units to be upgraded in the City and noted that taking this action was a critical next step in moving forward aggressively to achieve the SFPUC’s desired conservation goals. Commissioner Vietor observed that should these changes be implemented there would be dramatic benefits.

Public Comment:

Ms. Jennifer Clary, Clean Water Action, noted the SFPUC Citizen’s Advisory Committee’s unanimous resolution of support for this, cited it as setting a good example, and noting she had been pushing for this since 1995.

Mr. Jensen reported that BAWSCA was encouraging their own agencies who had the authority to do so to also implement such changes and commended SFPUC’s staff for their hard work to develop reasonable compromises to move conservation forward.

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

11. Discussion and possible action to authorize the General Manager to execute an agreement (Agreement) by and between the San Francisco Public Utilities Commission (SFPUC) and the North Coast County Water District (NCCWD) for the Construction and Operation of the Pacifica Recycled Water Project (Project). The Project would replace the existing potable water supply provided by the SFPUC and delivered by NCCWD, with recycled water for irrigation use in northern Pacifica. Resolution No. 08-0194

Assistant General Manager for Water Michael Carlin reported this as the beginning of the final stage of this long developing project with construction starting next year. The AGM for Water noted that, in partnership with the City’s Department of Recreation and Park, this project would save 38 million gallons of water annually.

In answer to a question by President Caen, Assistant General Manager for Water Michael Carlin explained that use of the water was to be paid for and described this as part of an expanded agreement with the Department of Recreation and Park to conserve water and reduce their costs. Mr. Carlin observed that it was the end result of a long planned expansion of the SFPUC’s menu of services that now could include recycled water. In response to a question by Commissioner Vietor concerning the change in location, Mr. Carlin described that, as this project had developed, it became clear the old distribution site was not appropriate and the new alternative not only saved money but conferred the advantage of a lesser environmental impact due to tanks and pipes already being in place there.

Public Comment:

Ms Jennifer Clary, Clean Water Action applauded this project and urged a yes vote noting the continued efforts to maximize potential recycled water uses.

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

PROFESSIONAL SERVICE CONTRACTS

Award

12. Discussion and possible action related to approve Amendment No. 3 Water System Improvement Program-funded Agreement No. CS-826, Groundwater Conjunctive Use Project Conceptual Engineering Services, with MWH, Inc., and authorize the General Manager of the San Francisco Public Utilities Commission to execute this amendment for a time extension of (3) months, for a total agreement duration of two (2) years and three (3) months. Resolution No. 08-0195

In answer to a query by President Caen concerning the use of wells in this project, Ms. Labonte reported that studies had demonstrated a need to spread the wells out in order to avoid draw downs and properly meet project goals. Ms. Labonte noted that there would be other well/groundwater projects coming before the Commission as the program went forward.

Public Comment: There was no comment.

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

13. Discussion and possible action to approve Amendment No. 1 to Water Enterprise Water System Improvement Program-funded Agreement No. CS-854, Engineering Services for Sutro Reservoir Seismic Upgrades and Rehabilitation, with URS/SOHA JV to provide additional Engineering Services for geotechnical investigation, and authorize the General Manager of the San Francisco Public Utilities Commission to execute this amendment increasing the agreement by $210,876, for a total agreement amount of $1,810,876, and with no time extension, for a total agreement duration of (3) years, and eleven (11) months.
Resolution No. 08-0196

In response to Commissioners’ questions WSIP Manager Julie Labonte explained that this change resulted in no increase in cost.

Public Comment: There were no comments.

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

CLOSED SESSION

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

There were no comments.

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

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

President Caen recessed the meeting for ten minutes at 2:45 P.M.

The Public Utilities Commission met in Closed Session at 2:55 P.M.

Present: President Caen, Vice President Crowley, Commissioner Vietor, General Manager Ed Harrington, City Attorney Noreen Ambrose, Laura Spanjian, Todd Rydstrom, Michael Carlin, Mike Martin, Don Furman, Joshua Millstein, Kate Stacy, Tim Ramirez, Ellen Levin, Joseph Yew, Bill Laws and 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.

17. Conference with Legal Counsel – Pursuant to California Government Code Section 54956.9 (b) and (c) and San Francisco Administrative Code Section 67.10 (d) (2) (Ambrose)
Anticipated Litigation: As Defendant. (2 cases)

18. Conference with Legal Counsel - Pursuant to California Government Code Section 54956.9(a) and San Francisco Administrative Code Section 67.10(d) (Rothschild)
Resolution No. 08-0197: David Sag/The Hassell Law Group c/o Dawn Hassell; Claim #08-0480309, filed August 1, 2007.

19. Conference with Real Property Negotiator – Pursuant to Sunshine Ordinance Section 67.8 (a)(2), Govt. Code section 54956.8: Property: Sunol Valley Aggregate Quarry (Surface Mining Permit 30), located at 6527 Calaveras Rd., Sunol, California. (Dowd)
APN 96-375-009

Property: 308.5-acre property located in Alameda County, Calif., known as the Sunol Valley Aggregate Quarry. SMP 30.

Parties Negotiating: SFPUC - Dowd 
                           Oliver de Silva, Inc.

Under Negotiation: Price and Terms

Following Closed Session, the Commission reconvened in Open Session at 4:12 P.M.

20. Announcement following Closed Session.

Following Closed Session, President Caen announced the actions taken during Closed Session as: Item 16, and 17, no action; Item 18 settled.

21. Motion regarding whether to disclose the discussions during Closed Session.

Moved by Commissioner Vietor, seconded by Vice President Crowley not to disclose the discussions during Closed Session; passed (3-0 Caen, Crowley, Vietor) unanimously.

There being no further business to discuss, the meeting was adjourned at 4:15 P.M.

Michael Housh
Secretary