San Francisco Public Utilities Commission Watch

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Focusing on the Big Picture

Happy New Year! For SFPUC (water-sewer-power) it will be achallenging 2019.

Water: A whole lot of water has been taken from our water supply, throwing a monkey wrench into SFPUC’s careful planning. To survive the inevitable dry spells, water from wet years must be stored. Our water system was designed to weather a long dry spell, using what is called a “design drought.” The entire system of facilities was sized accordingly. The process took years.

But the state has implemented its Bay-Delta Plan over the strenuous objections of SFPUC and the irrigation districts that share water rights with SFPUC. SFPUC’s rights are junior, which means that it drinks at the fountain only when the irrigation districts have had their quota. If flow is insufficient in any year, tough luck for SFPUC.

The state has decided that twice as much water must go down-river as before. Fish benefit. SFPUC and the irrigation districts have sued to overturn the state’s decision (and to maintain some negotiating leverage). They say there are other ways to benefit fisheries.

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SFPUC’s rights are junior, which means that it drinks at the fountain only when the irrigation districts have had their quota. If flow is insufficient in any year, tough luck for SFPUC.


SFPUC calculates that during its design drought, rationing of 40% will be required under the state’s plan. Previously, its design drought was based on a maximum of 20% rationing, and suburban customers claimed that was too high. Serious economic harm would result.

SFPUC is searching for replacement water. But in California that is very hard to find, and is expensive. Desalination and “water purification” are likely to be explored. Water purification is making wastewater fit to drink.

Power: With PG&E going bankrupt, SFPUC’s infant public power agency will be challenged in 2019. There is talk of buying up PG&E’s physical assets. CleanPowerSF lacks experience handling those. This Spring, enrollment is to triple; most of the city (including the Westside) will be automatically enrolled.

Additionally, pressure is being applied to build renewable energy generation. Everyone agrees that local, renewable generation of electricity is desirable. But accomplishing this is difficult and expensive. Now, with PG&E’s competition fading from the picture, the heat is on to do what has been put off. Leaders have promised to begin working up a build-out program beginning in July. The Commission is to receive it in January.

Sewer: On the sewer side, the largest project of the $7 billion SSIP (Sewer System Improvement Program) is set to begin this year. Deep foundations for the new digesters will be dug. This will be an early test of whether the mammoth project can be kept on time and budget. The largest project of the earlier water program more than doubled in cost, overrunning by $300 million and years in time. Will that repeat? The digesters job is considerably larger.

What do all these challenges mean for the ratepayer? No one knows, it all depends on how the challenges are met. But the signs are ominous. Will progressive supervisors and advocates berate CleanPowerSF into fast-track building local renewable generation facilities? Will it be able to handle physical power facilities? Will the digesters job overrun? Will replacement water be found? So much converging all in one new year.


South Ocean Beach. While storms and high surf have pounded the beach, no emergency action has been required (at time of writing). No sand was brought in last year, but previous years’ sand has helped. Rock (riprap, revetments) remain to protect the cliffs, although eventually these will be removed. Rain runoff has been controlled. The southbound lane of Great Highway was briefly closed, but roadway has not been permanently lost, nor has wastewater infrastructure been seriously threatened. (A small portion of closed roadway has been undermined.)

SFPUC says it is on track to protect wastewater infrastructure with a 3000 foot buried wall. It is advancing geotechnical (soil, earth) investigation, and hopes to have a conceptual wall design in about six months. A permit is needed by the end of 2021; construction is to begin mid-2022, and should take 28 months. The cliffs will likely be somewhat reshaped. Once wall protection is in, rock can be removed from the beach. Until then, large sandbags will be added if “trigger points” are reach, that is, if the ocean closely threatens damage to wastewater infrastructure.


Fiscal San Francisco. For those who missed it in the mainstream press, San Francisco projects a deficit of $644 million in five years, no recession figured in. In response the mayor directs departments not to add new positions, and to cut budgets two percent. The average annual cost of each employee is $160,700. There are somewhere in the neighborhood of 31,000 employees, costing about $5 billion per year.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2019

Affordable Housing — It's Not that Easy.

Let's do a thought experiment. Imagine the way voters would think, and vote, if housing were allocated as in my youth, decades ago. Imagine that rents rise annually. At what percent? It depends. Recently in SF it has been about 5%. But the more housing added, the lower the rate of rent increases. Less housing added means greater rent increases.

Today housing is allocated largely by luck. Those who have rent controlled homes are in clover. With a big scary "unless…." Those lucky winners of an affordable housing lottery smile. Those with "special characteristics" recognized and accommodated, for example teachers, or elders, may also find luck. Then there are those left to the sharky waters of the Market. Not so lucky. Supply has been constrained, demand is high, prices likewise. These Market tenants often support affordable housing luckies, and live with them, want to or not.

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But every neighborhood wants housing added elsewhere. In order to keep rent increases down, new housing must be allowed somewhere. What to do?”

Politicians thrive in today's housing mish-mash. Developers beg to befriend them. Tenant voters eat up the pol's tough talk; "greedy landlords" make a great target. Affordable housing residents want no boat rocked. Nonprofits too, with their million dollar CEOs, building and managing "affordable housing," are onboard. Bureaucrats who administer all the complication have city jobs. There are Planning Commissioners to appoint...the list goes on. Government grows and thrives.

Now let's get back to imagining what voters would think was housing allocated by a free market. Rents rise every year; this is certain as death and taxes. How much? Again, the more housing added to the housing stock, the less rents rise. Less added, the bigger the rent increases.

Under such a scheme the 70% of voters who rent would want housing added. That would keep their annual rent increases down. But of course the additional housing should not be in their backyard; preserve my neighborhood, and clog not its roads and trains.

But every neighborhood wants housing added elsewhere. In order to keep rent increases down, new housing must be allowed somewhere. What to do?

A balance will be achieved. Politicians may pay off neighborhoods that allow housing to be built. Each Supervisor negotiates for his neighborhood. Somehow a balance gets done. Voters are motivated to enable housing (and to elect a good negotiator as Supervisor).

What about the 30% who own their own homes? Won't they only want no change in their neighborhood? Admittedly, this is so. Also, fewer homes built means theirs goes up in value. This needs to be overcome. Can it be?

Possibly. Today there are restrictive covenants: one lot one home one family. If housing production fails to meet targets, perhaps public policy will set aside these covenants. Restrictive covenants will become unenforceable as against public policy. Not impossible. That prospect just might gain the cooperation of single family owners.

How many new homes are needed? That has been answered in an opinion piece in the Examiner. Patrick Wolff set out what it will take to lower rents to reasonable and customary levels. We need a fifty percent increase of nearly 200,000 units over twenty years. That's 10,000 units a year, double what is recently the target of City Hall.

Isn't 10,000 units per year fantasy? Yes, right now it is, because we have misplaced incentives barring us from getting there. Instead of "compassion" for the poor and displaced, offering a lottery number with the drawing usually coming too late to help, what if we realized that incentivizing for the long term is ultimately more compassionate than continuing down the rocky and worsening road we're on. A mess has been made; we have a system that severely limits the building of housing. We compound our error by demonizing developers and landlords; after all, they supply an essential of life—shelter. Is that so bad? (It's our policies that make developers and landlords act badly; good landlords are punished under the present system.)

We're now well along the road to socialism for housing. We know how that looks: Soviet Russia showed us. Or, when nothing gets built, Cuba (admittedly charming, but run-down, way down). Socialism over-believes in the goodness of humankind. Picture those posters of the new Soviet worker! Mythical. Drab blocks of dreary housing, with who you know or grease to gain preference. The Market method assumes that humans act self-interestedly. No Pollyannas. (Well, maybe one: me. Why else would I engage in this crazy thought experiment?)

What about the poor? How do they jump the shark of today's outrageous rents? Twenty years is too long to wait.

The City made the mess, and the City should remedy it. Today we spend big bucks on all manner of housing subsidies. Perhaps a declining subsidy for needy renters, based on length of residence in SF and income, is just. The subsidy should decline over no more than twenty years, 20/20ths, 19/20ths, 18/20ths…. Feasible? One can only hope.

Continuing down the path we've followed we can expect no better results than what we've seen, and will probably get worse. Shouldn't we think about how to solve the housing crisis? Can't we end the blame game, and aim for what can work?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

June 2018

Politically Correct Sewers & Electricity?

CleanPowerSF Comes Calling.

You may have heard that PG&E is losing business in San Francisco to the SFPUC program CleanPowerSF. Your household will automatically be enrolled in CleanPowerSF unless you opt out. (Westside: probably April 2019.) If enrolled your power is provided by the city (by CleanPowerSF) and transmitted ("distributed") to your home or business by PG&E. About half of your bill payment goes to each, PG&E for transmission, and CleanPowerSF for generation.

CleanPowerSF is very slightly cheaper, and its power is more renewable. After the switch you will still get one bill, from PG&E.

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What is the argument against public power? It weakens PG&E, reducing its customer base and revenues. Why should you care? PG&E is immensely unpopular, especially after the San Bruno explosion and the North Bay fires.”

Most folks don't care who provides their electricity, and they will do nothing and automatically be enrolled. A few (4.2% to date) elect to pay more for their power; it is then "100% renewable, Super-green." The actual electrons consumed by Super-green enrollees are not all renewable; electricity comes from the grid. It's an accounting thing.

Should you opt out of CleanPowerSF? The SFPUC Commission is told that opt-outers are 1) PG&E employees, and 2) those disbelieving in public power.

What is the argument against public power? It weakens PG&E, reducing its customer base and revenues. Why should you care? PG&E is immensely unpopular, especially after the San Bruno explosion and the North Bay fires.

One thing to think about is: What happens after the next major earthquake? City pols use PG&E as a punching bag. Voters eat that up. But after the next major earthquake PG&E will turn the power back on. SF hopes for rapid service. But SF has done much to tempt PG&E to prioritize elsewhere. (Like Puerto Rico?) Fine for city pols to punch the lights out of PG&E, scoring easy political points, but won't we power-consumers be needing PG&E? It still distributes the power.
So, do you wish to jump on the beat-em-up bandwagon? A few will not; far too few to make any difference. Sadly, our best hope probably lies with our loud-mouthed politicians. Hope that PG&E is cowed into providing SF with good service when the inevitable earthquake strikes.


Cost and time span has increased yet again for WSIP (Water System Improvement Program, 2003-ongoing, now $4.8 billion, started at $3.4 billion). The program is now expected to be completed at the end of 2021 for just under $4.8 billion. Ten years ago all was to be done by 2014. The cost of the largest project has more than doubled.

As major public works go, an increase of 40% (albeit with decreases in scope of the work) is not so bad. Compare the new eastern span of the Bay Bridge. If the Sewer System Improvement Program (SSIP) has like cost increases, it would come in costing $9.74 billion. With increases so far, today's cost: $7.3 billion. As the SSIP schedule is more than twenty years, let's hope that time span does not increase as has WSIP's.
SFPUC sells bonds to pay for the great majority of work of the WSIP and SSIP projects. Rates rise to pay off this bond indebtedness. For the next four years rates are rising at 8.45% per year. Four-fifths of the rate rises are due to capital costs, most of which are financed with bond proceeds.

SSIP, Phase One, has again been revised with costs up and 37 projects delayed, 11 advanced. Phase One's cost is just under $3bn. (Phase One is the portion of the SSIP program to be done 2016-2025.)


Outdoor Warning System. On Thursday April 19 the city's Outdoor Warning System sounded a false alarm said to be caused by testing new software. What is a real alarm? How can you tell false from true?

Here's what is on the city website: "Every Tuesday at noon, San Francisco tests the Outdoor Warning System. During the test the siren emits a 15 second alert tone. In an actual emergency, the siren tone will cycle repeatedly for 5 minutes. Should you hear the sirens at any time other than Tuesday at noon, go indoors and immediately tune to a news source such as KCBS 740 AM, or other local media stations."

So while you hear a voice after the Tuesday test, you will not necessarily hear one when a real alarm sounds. An alarm without the cycling of the alarm sound is not real. Alarms may mean earthquake, tsunamis, or terror attack coming.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

May 2018

Is the City's policy of inclusive affordable housing best? San Francisco's ideal is for each new development (10 units or more) to include affordable units. Developers who do not include affordable units in their housing development must pay at a penalty rate into an affordable housing fund, or build even more units offsite.

Is this good policy? Authors of a Reason Foundation study, and American Enterprise Institute authors, say no: it raises the cost of housing, and reduces supply. If true, a key element of SF's housing policy intended to add supply is instead adding to the problem.

Would that civil discussion could be had about how to solve problems, rather than the status quo: reflexive attack and scolding, laced with put-downs and moral superiority.

This author has no opinion on inclusionary affordable housing (aka inclusionary zoning), only that SF should do what works. Are we aimed properly at what works when one side of an argument is reflexively shut down?

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Would that civil discussion could be had about how to solve problems, rather than the status quo: reflexive attack and scolding, laced with put-downs and moral superiority.”

"Confirmation bias" is the phenomenon of crediting the facts that support your position, and overlooking or denying those facts that cast doubt. We all do this to some extent. Social media seems to add steroids. In the Bay Area, with its leftist monoculture, is their any doubt that confirmation bias happens more?

If solving problems is the aim, not just fighting the righteous fight for our "team," we need to open up to and encourage debate. Debate or stagnate.


Sea Level Rise. While rising seas expected over the coming decades will affect the eastside of town much more than the westside, your pocketbook likely will not go unaffected. How will the city pay for the work required?

On the westside, in the next decades wastewater infrastructure at and near the Oceanside Treatment Plant is at risk. The plan is to protect it for a few years with sand and sandbags. Then an underground wall is to be built. This work probably won't cost much more than $100 million. But eventually the Oceanside Treatment Plant may be threatened, and may have to be moved. That would be costly.

Over the next couple of decades the Embarcadero Seawall needs to be repaired or replaced. That will cost $4 billion in today's dollars, supposedly, if, as seems likely, it is raised a few feet.

But big public works projects tend to overrun in cost (and time) often by surprising amounts. Example: the eastern span of the Bay Bridge: less than a billion originally estimated, actual cost six billion plus, so far. Former Mayor Brown has said that the initial estimate for large projects is a "down-payment" no one takes seriously.

Should an earthquake shake the city, then costs will go through the roof.

Perhaps business will pay for much of the eastside work, as it should. But how easy it is to tap homeowners! Two-thirds of voters are envious renters. They feel that lucky homeowners should share part of the gains in home values our city has generated.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

April 2018

Taking a Walk on the Beach

Take a walk with me on South Ocean Beach. This is the more than half mile stretch between the west end of Sloat and Ft. Funston's northern end. We walk during low tide. High tides obliterate the beach. This is where the cliffs erode, where the sea eats away at the land.

Emergencies happen. A part of the parking lot is closed, unsafe. A part of the Great Highway is closed; asphalt fell off the cliff. Walking atop the cliff one sees erosion canyons, broken pipes and fallen drains. Sandbags are to be placed, probably will have been placed by the time you read this.

In past emergencies revetments were created with big rocks. These work: the cliff face remains further oceanside. Where there are no revetments the ocean has taken cliffside, which is pushed inland. In one place there are rounded concrete blocks, almost like cobbles. These pieces of con

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Certain phrases attain a siren-like allure to those of the government world. Affordable housing (not housing); locally sourced. Once a phrase attains a certain lift, it floats, free of gravity, lifting soaring spirits heavenward.”

crete rubble were once part of the roadbed. They slid and fell down; the ocean has long topped them daily, rounding them. Here the cliff-face is not so far inset as where there are none (the road above curves away), but further inset than where there are revetments.

What can we learn? Revetments work, retaining land. Rock rubble also works, some. Allowing the ocean free reign loses the most land. Seas are rising, so far slowly but relentlessly. The face of the cliffs has moved inland by many yards, and surely will move east more.

Notable, too, is just how vulnerable infrastructure is. The cliff-face is close to the Western gates of the Oceanside Sewage Treatment Plant, just a few yards off. The cliff-face is right next to parking lot, and road--the lane reduced Great Highway. Walk along the top of the cliffs and you can't help but be alarmed at how little land remains.

Walk on the beach, and scratch at the dense sand-like material (Colma formation), and you can't help realize how vulnerable this cliff-face is to the elements. No solid rock this.

So what is the City's plan? Not new, this problem. The latest plan is a 2012 master plan that is being implemented. It's mantra: managed retreat.

Certain phrases attain a siren-like allure to those of the government world. Affordable housing (not housing); locally sourced. Once a phrase attains a certain lift, it floats, free of gravity, lifting soaring spirits heavenward.

Managed retreat is to do two contradictory things. One, it removes rock from the beach, returning the beach to nature, supposedly. Two, it builds a new and invisible wall to protect City infrastructure.

How will this new invisible (buried) wall be built? Think of pencils lined up side by side. Now turn them vertical. Those pencils are the three or four foot diameter concrete piles that are to be drilled in a long line, 3000 feet and more, to form a wall. These piles must protect a buried storage pipe (Lake Merced tunnel) fourteen feet in internal diameter, under the western edge of the Great Highway--in places, now abandoned pavement. Just how heavy construction equipment can be moved onto the tiny sliver of land remaining between highway and cliffside you should see and imagine for yourself. I can't fathom it.

Once this invisible wall is installed the rock to the west at the foot of the cliff-face comes off the beach. Is it not certain that the new wall will soon be seen? Without rock protection the ocean will eat greedily, and cliff's edge at high tide will march east.

Per the current plan construction on the new wall starts early in 2022, four years away. As wall is installed, rock is removed. Paying for both we replace one ugly with another.

What sense does this make? Government sense, sung by the siren of a mantra: managed retreat.

PS Why do governments chase mantras such as managed retreat? A term resonates, seems popular, perhaps cutting edge. Using it bestows a cool factor. Experts are engaged; they quickly learn what is wanted. Their study and report is tailored to fit. A mutual reinforcing society arises. Higher public officials are brought in. So long as money can be found, the plan smoothly adheres. Time reinforces; long acceptance brushes off late questions.


Water rate increases are coming. It appears that the rate charged for water will rise by 9% on July 1. On subsequent July 1's, in 2019-22, rates will rise by 8%, 7%, 7% and 6% for a 5-year increase of 43%. These rates cover budgeted costs as proposed. But stay tuned; they could change. About half of water revenues pay bond debt (for improvements made over the past 15 years, WSIP). Employee numbers and cost are to rise slightly. How big is SFPUC today? Annual expenditures average a little over a billion dollars.


Flood prone. SFPUC has produced a draft map of areas of the city, including many on the westside, which would flood in a big storm. It is proposed that these properties inform potential buyers, meet certain plumbing requirements upon sale, and flood-proof when building new. Flooding is an increasing problem; seas will rise, and storms intensify. The city's combined sewer system, sanitary and storm water in one, is troublesome. Property owners should be on the lookout for notice that their property is subject flooding, and may wish to be pro-active.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

March 2018

Wading in Dangerous Water?

It's perhaps hard to be concerned about water supply during the winter rainy season, especially after last year's big water year. Yet concerned we should be. Water supply will take a number of hits. In the long run we need luck, or, better, we need to take action, and the earlier the better.

"We" is SFPUC, our water provider, and provider to our southern and southeastern neighbors. Ensuring adequate water supply is a key SFPUC concern. But we the people and our elected representatives better be watching too. The risks are multiple. A UC climatologist predicts that California will get 10-15% less rain than it is used to. Moreover, climate change will bring high pressure ridges that keep storms to the north and west. We experienced this last December. We'll have more deluge and drought. Warmer conditions mean less snow storage, the best type. No one wants more reservoirs, but do we have a choice?

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A UC climatologist predicts that California will get 10-15% less rain than it is used to. Moreover, climate change will bring high pressure ridges that keep storms to the north and west. ”

Then there is a multiplicity of man-made risks to our water supply. The state will require more water to come down the Tuolumne River so that the Delta gets no more salty, and fish have a better chance of survival. The current state plan would have rationing at a ridiculous 50% during drought, SFPUC says. Imagine that. SFPUC has countered with a less impactful plan. Negotiations proceed.

FERC, a federal regulatory body, must re-license Don Pedro, a major storage facility, creating another risk. Don Pedro holds about a third of the water our system can store. Relicensing is primarily the responsibility of irrigation districts, which own Don Pedro. Fish are again the concern. Water will be released, but also other steps will be taken to improve habitat. Relicensing is to be completed by 2020.

Replacement water for water lost to instream release requirements must be found. An instream release is required to protect natural bounty.

Expectations for supply from groundwater and recycled water have diminished. Lake Merced's requirements are uncertain.

Two provisional customers, San Jose and Santa Clara, are to be accepted or rejected as full customers. SFPUC staff wishes them kept. Cutting them is made tougher because right now, and for the next few years, we have plenty of water, and surprisingly low demand. Short-term we want that business. But long-term? By accepting two more customers we could be wading into deep and dangerous water.

SFPUC has assured its out-of-town wholesale customers that up to 184 mgd (million gallons per day) will be available to them, subject to reduction (up to 20%) during drought. In the future wholesale customers estimates they will take 3% more per year than they do. San Francisco fills its own needs only after delivering to its customers. So not only are our water rights to Tuolumne River water subject to the primary rights of the irrigation districts, the state's requirements, and FERC's, but also San Francisco fills its needs only after out-of-city customers get their growing drink.

We've got supply troubles aplenty: local, state, federal, and even heavenly.

One hundred and five years on, one still reads laments about how San Francisco stole Hetch Hetchy Valley to quench the City's thirst. First of all, two-thirds of the system's water goes to those outside the City. Imagine if, suddenly, the system did not have a dam and reservoir in the Valley. Our water supply troubles would instantly go from daunting to unimaginable. History happened. Right or wrong, let's take it from here. Maybe San Francisco and the Bay Area should be smaller, less populated and possessed of less water. It isn't; it is a great city and area blessed with pure water from a still wonderful national park. It's time to move on. It's time to worry about the future, not the past.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2018

But Who's Counting?

The expected cost of SFPUC's (water-sewer-power) Sewer System Improvement Program (SSIP) has risen to $7.3 billion. Costs are rising because the construction industry is roaring; also projects have been changed, and shuffled. Twice before the program has been changed. The latest revisions include cutting work. More work is done late in the program. (Costs are in 2017 dollars.)

Rising costs puts upward pressure on rates. Rates will be set for two years. The process begins early in 2018, and should be done by May.

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If you are a renter (or pay a collective water and sewer bill), the rate increase takes time to reach into your pocket, but it will. If you pay bills directly, July 1, 2018 is when new rates take effect.”

Upward pressure on rates has built over the past two years as households used less water. Costs are mostly fixed. If less water is used, rates need to be higher. (Suppose revenues needed are 100. If 10 units are used, the rate is 10; if 9 units are used, the rate is about 11.)

Ideally rates rise smoothly, without spikes. The increase in the budget for the SSIP, the too low rates we've enjoyed these past two years, and the roaring construction industry, which affects all city work, will push new rates higher.

An example of how the roaring construction industry affects other work and cost is provided by the water main replacement program. Years ago a goal of 15 miles per year was set. It has not been met. There is so much work going in the city that delays occur, and competition for workers has reduced supply at wages budgeted. The General Manager budgeted $50 million per year; it has not been sufficient. Not only will the cost per mile increase, but having missed past goals, the miles done per year may increase to make up.

Articles in this and other papers about the AWSS system, for fighting fire after an earthquake, have criticized SFPUC for failing to extend the system to all city neighborhoods. Eleven mostly western and southern neighborhoods are left out. Should SFPUC be pressured into remedying this, rates may be put under yet higher pressure.

Look to this space for more on water and sewer rates as the process unfolds in the coming year. If you are a renter (or pay a collective water and sewer bill), the rate increase takes time to reach into your pocket, but it will. If you pay bills directly, July 1, 2018 is when new rates take effect.


Mainstream press announced SFPUC's plan to spend $700 million over the next fifteen years fighting flooding of SF homes and businesses. That's ten percent of what is to be spent upgrading the sewer system. Ten percent for one percent of the area SFPUC serves. Included will be reimbursement for improvements made by homeowners.

Once such reimbursements were illegal "gifts of public funds." Once the public was safeguarded by taxpayer (ratepayer here) lawsuits declaring such expenditures null and void.

Should ratepayers pay to protect properties from flooding? These properties were purchased with the problem. Undoubtedly these properties were discounted accordingly. Should the public also pay when a property becomes worth less due to less available street parking, more traffic, closer homeless encampments, or more noise? Should owners newly near trendy shops and restaurants share their fortune with the city?

Fixing the sewer system once cost $1 billion; now it is supposed to cost $7.3 billion. At ten percent of the total, flooding will still not be fixed; it will be mitigated.

Once SFPUC is in the business of ensuring flood-free property throughout SF, watch the expense rise like...well, flood waters during a super-storm.
The Commission President is appointed as a consumer-ratepayer advocate. This observer has seen little consumer-ratepayer protection. "Affordability" is routinely given lip service, but one wonders.


For those readers with an interest in finance: A new state law took effect, requiring the SFPUC Commission to be given information before authorizing sale of bonds (recently, $400 million, water). The bond funds pay for capital improvements: interest rate: 3.61%, finance charge: nearly $2 million, amount agency receives: $368 million, amount agency pays back: $643 million (round numbers).

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

December 2017

Is "managed retreat" manageable?

The Ocean Beach Master Plan (2012) is being implemented in ways both physical and verbal. South Ocean Beach (south of Sloat to Fort Funston) is eroding. Seas are rising. If left alone, valuable and necessary infrastructure may fall prey to the ocean.

It happens both gradually and suddenly. Gradually in that the ocean's rise is slow but relentless. Suddenly in that in one storm, when conditions are right, the ocean can strike decisively, even after years of slumber.

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Some believe the rock should stay. It is there, it protects. If it is removed, erosion may occur more rapidly than predicted…”


The master plan adopted "managed retreat" as a guiding strategy. The idea is to adapt to nature. That's the "retreat" part. The "managed" part hedges. We will try to protect the essential infrastructure for long enough to get, if not full then close to full, useful life from our investments. Protect the ratepayer, at least some.

Words, weasley words. What to do? In past emergencies, rock has been dumped to protect the cliffs from erosion. The master plan says the rock is to be removed when it can be done safely. Should it be?

Sand is being placed to raise the beach. Sand bags have been and may be placed. Other forms of protection are considered: cobble berm, buried wall, and more.

Some believe the rock should stay. It is there, it protects. If it is removed, erosion may occur more rapidly than predicted, and then the city may be required to spend big to protect or move not only its wastewater storage facility, but also, perhaps its whole sewage treatment plant (the Oceanside Treatment Plant). That could cost billions. And, where would a relocated plant be put?

Environmentalists support managed retreat. But even some of them want the plant's wastewater storage facility moved soon—well before its "expiration date." Is that proper management?

These are some of the tough questions fermenting at City Planning and SFPUC, which owns the treatment plant and related. Finding the right balance between retreat and proper management is key to keeping rates reasonable.


SFPUC (water-power-sewer) employees rule. Yes, there is a Commission to set broad policy. But the Commission only tugs here, shoves a bit there.

Recently staff presented yet another revision to what it plans to do with the "collection system." What is collected is sewage and stormwater. Work on the collection system represents well over one-third of the SSIP, the $7 billion Sewage System Improvement Program now underway.

Revising collection system work is not the first shuffling done. Earlier revision has included postponing work. Staff likes planning. Doing the work perhaps not so much. Putting work off ensures one's job for longer.

Despite shuffling collection system work around, the total predicted cost turned out exactly the same for the first ten years of work.

Before SFPUC began its water system renovation (2003-present), it published a plan, experts studied what was needed, and a blue ribbon panel reviewed what the experts did to ensure that all was necessary and proper. The Commission and Board of Supervisors endorsed the water plan. The plan was presented to voters of each of the eleven districts. Voters okayed the sale of bonds.

A similar review process was not done for the sewer renovation work even though it will cost San Franciscans more than four times as much. Why? Voters exempted SFPUC from having to get voters to approve funding for its projects. Once exempt, SFPUC and its employees can do pretty much as they please.

Before the exemption, the program now called SSIP had a one billion cost. Now it is seven billion. Now work is shuffled around, this increased, that decreased by tens of millions. Is all the work necessary? Maybe, or maybe it suits employees.

More than tax dollars, three-fifths of which are paid by business, it's your money paid in rates for thirty plus years after it is spent. Seven billion dollars, if the budget holds.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

November 2017

Affordable City?

What will the sewage system upgrade really cost?

SFPUC (water-sewer-power agency) is finishing up its $4.8 billion water upgrade (WSIP), original price $3.4 billion, and has launched its even larger program upgrading the city sewer system. The sewer upgrade is called SSIP, Sewer System Improvement Program, $7 billion. Back in 2002 the cost was one billion dollars; with time, work and cost expand. There is $12 billion of need, according to SFPUC.

The SSIP program stretches over more than twenty years. While the price tag is $7 billion, what will it really cost?

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It is not practical to sample all the soil a contractor will encounter doing its work. The consequences of finding say a buried ship, or more normal obstructions, can be much greater in a city. Where there are consequences there are inevitably costs."

No definitive answer is possible. But let's take a look.

Change orders added 25% to WSIP's cost. If the same percentage is added to SSIP, then cost would rise to $8.75 billion.

There is reason to believe that more than 25% may be added.

Differing site conditions accounted for the vast majority of changes to the water system (WSIP) contracts; such changes cost two-and-a-half times what all other WSIP changes cost. A differing site condition is an unknown, usually underground, condition materially changing the work. Obstructions qualify. So may unexpected soil conditions.

WSIP's work was along much of the 167 miles from San Francisco to the Sierras, where most of our water is sourced. Much of the work was new. And much was done in rural places. But SSIP work is in San Francisco. All sorts of man-made things are under the surface of the ground. Even the soil itself is often changed (fill).

It is not practical to sample all the soil a contractor will encounter doing its work. The consequences of finding say a buried ship, or more normal obstructions, can be much greater in a city. Where there are consequences there are inevitably costs.

Differing site conditions may include the object of the work itself. If, when dug up, a sewer pipe is in worse condition than expected, that, too, could entitle a contractor to a change, adding cost to the project.

In July staff presented a requested memo to the SFPUC Commission aimed at reducing the 25% change order swell for SSIP. The memo is mostly justification; that's what bureaucrats do. Well intention though the effort was, reading the memo, there is little reason to expect success.

Perhaps the first really big project, building new digesters for Southeast Plant, will shed further light on how change orders will add to the cost of SSIP. Construction is scheduled for August 2018 through May 2024. Underground work, to dig foundations and drive piles, will be done early.

Let's hope the Transbay Transit Center is not indicative of how costs will run for SSIP projects. The cost there has jumped by about 50% even though the work is not far along. The main reason seems to be that estimates were made before the city became such a magnet for construction. In the wake of hurricane season 2017, construction resources may flow to needy locales, further depleting construction resources and raising bid prices here.

Officials hope to keep household water and sewer cost under 2.5% of median household income. But that ceiling is already looming. With more cost increases, hopes die.


Selling one's property, or remodeling in a major way, is soon likely to become more expensive. SFPUC's Commission is considering steps to address flooding. Some steps apply to all properties, even though only a small fraction of properties are flood risks. One step discussed is requiring the sewer lateral to be inspected upon sale or remodeling. Unasked was, how expensive will that be? (How typical is this? Public servants care not about cost.) Additionally, a backwater valve requirment is to become the subject of firmer enforcement. Both these proposed changes will cost homeowners.

"Collateral damage" might be the term. When government sets out to solve problem #1, it may identify and address problem #2. The cost of #1 may be discussed, but the cost of #2 is simply imposed without discussion.

So it's not just that government grows like topsy (which it has and does). It's also that government keeps nibbling away.

On the other hand, government now gives away money. It plans to give to businesses affected by downtown construction, a precedent that is almost sure to thrive like a garden weed. Once upon a time such give-aways were banned as a "gift of public funds." No longer. Compassion and interest group politics combine to encourage such spending. What pol can say no? Especially when there is no taxpayer and ratepayer organization protesting.


Last month this column mentioned collecting water from fog. Sounds fog-fetched, but recently BBC writes: "In a $1.75m (£1.29m) prize competition, the [Water Abundance Project] is asking teams of engineers from around the world to create "a device that extracts a minimum of 2,000 litres of water per day from the atmosphere using 100% renewable energy, at a cost of no more than two cents per litre." Or as the organisation puts it, "harvesting fresh water from thin air". If the XPrize competitors can come up with such a device, it'll be revealed next August." A U.C. Berkeley engineer is working on a magic elixir he calls metal organic framework. Hey, who knows?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

October 2017

Water Woes: Power Hour

In July the SFPUC Commission was informed that water supplies are insufficient to provide for the city's growth. (SFPUC is the city's water-sewer-power provider.) In a year of plentiful precipitation it may be difficult to credit and give attention to such an announcement. Yet nothing is as certain in California as deluge and drought. As far back as the late 19th Century, one region suffered an eleven-year drought that drained two-thirds of the population, moved or dead. A drenching does not permanent relief make.

In addition to growth, further challenges are likely to contribute to water shortage: Tuolumne River needs (as set by the State), regulatory risk, earthquake, climate change, and longer droughts. Think about it. With the exception of regulatory risk, these are certainties. In essence the SFPUC Commission was told, "water supplies will be insufficient" in the future, unless something is done.

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Considered a key step to achieving a 100% renewable city by 2030 is CleanPowerSF's SuperGreen. Displace PG&E (too slow to convert to renewables) and upgrade to SuperGreen, which is said to supply 100% renewable electricity to your home or business today. Does it really?"

The immediate step is groundwater. By adding that small but significant contribution to supplies, a bad situation is mitigated some.

But groundwater is not enough. It will amount to less than 5% of need. Conservation, too, is essential, but insufficient. With present tricks played, our water system still comes up short. During a future drought, rationing of 50% is feared. Could you get by on half water?

For years we've tried to buy water from the irrigation districts that have first rights to Tuolumne River water, to which we have junior rights. But relations with these "relatives" of ours are historically sour. A deal would make sense, but one has long eluded SFPUC.

Desalination has been "piloted," but seems abandoned for now. Recycling wastewater for potable use has been much discussed in the industry, but disgusts end users. Still, here is an available source of water. Users may have to become accustomed to it. Or perhaps new technology will save the day. San Francisco has fog; who knows what might capture and convert that, sucking water from not-so-thin air. Invention needed.


By 2030 San Francisco aims to be 100% renewable. What this means is unclear. Whatever it may mean, is the goal worthwhile?

The idea is to encourage renewable energy generation. Fine. But the real goal should be reduction of greenhouse gases (GHG) emitted into the atmosphere. While renewable usage may be correlated with reducing GHG emissions, they are not the same thing. As a city we could use more renewables and at the same time emit more GHG. Why not aim for what is important?

The cynical answer is that there is profit in renewables. Also, it is an easier target. Emissions are hard to measure. Reducing GHG emissions can adversely affect economic growth. For politicians, much better to aim at easy, and declare victory, than aim true but fail.

Considered a key step to achieving a 100% renewable city by 2030 is CleanPowerSF's SuperGreen. Displace PG&E (too slow to convert to renewables) and upgrade to SuperGreen, which is said to supply 100% renewable electricity to your home or business today. Does it really?

Well, in a sense yes, in another sense no. The electricity flowing to your home or business is from the grid; it is all pooled together, and the individual electron that reaches your home has no greater chance of coming from a renewable source whether you are SuperGreen or not. But if you are SuperGreen there is an accounting recognition: the sum of all SuperGreen consumption is subtracted from total CleanPowerSF consumption, then the remainder is divided into renewable-nonrenewable. As there is a renewable target, about 40% now, the more SuperGreens there are, the more renewable energy that must be purchased (or generated locally) for the (default) Green category. So, by enrolling in SuperGreen, paying a little more, you encourage the generation of renewable energy. It's not as direct as buying organic veggies, where you consume organic.

CleanPowerSF is enrolling households in its program through 2019 on a rolling basis. Generally, the east side of town is being enrolled first. You can sign your household up early if you wish, and you can enroll as SuperGreen. Go to, Environment, CleanPowerSF, SuperGreen; or call 415-554-0773; have your PG&E account number. Upon receiving notice of your impending enrollment, you can also opt out should you wish for PG&E to continue to supply power to your household.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

September 2017

Digesting the Environmental Impact Report

Environmental review of a project requiring an EIR now takes more than a year to complete and costs tens of thousands of dollars. In the case of one large SFPUC project, the result is a document of more than 1100 pages.

Does anyone read such a tome? Does it serve a purpose other than employing bureaucrats and experts?

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Let's hope that the biosolids digesters, subject of that thousand page tome, do serve adequately for what seems like a surprisingly short planning horizon of twenty years.”

A generation ago major projects could complete environmental review in a month. Surely we value the environment more today, and are more careful. But really?

The large project for which more than a thousand pages was written is for new biosolids digesters. Digesters are tanks that deal with ("digest") sewage solids. Unfortunately, the stomach analogy is a good one: Bugs in these tanks devour the solids, then die. Bug bodies become sewage sludge. Generally, sludge is spread on agricultural land to fertilize. Digesters are at the heart of a sewage treatment plant.

There is no question that new digesters are needed and will be built. The old ones are too old, having lasted for 65 years so far. So the environmental review (EIR) is not for deciding whether to go forward with the project. At best it is for identifying least impactful ways of doing it, and for deciding on mitigations for unavoidable harms.

The new digesters aim to serve City needs through 2045. They will be fully functional, if the schedule holds, by 2025. Twenty years covered. About $1.5 billion cost. Not to mention road closures for years during construction, neighborhood disruption, noise, and other environmental effects during six years of construction.

The new digesters have been years in planning. Staff traveled to Europe to assess the new technology that will be used. Committees reported and recommended. Artists rendered. Siting people relocated shops, and studied the site. (The site is very tight.)

With the new digesters, once they begin operating, good to suffice for twenty years, will planning for the next twenty years begin shortly after operation of these new ones begins?

One wonders, too, whether the new digesters will indeed be adequate until 2045. Recently San Francisco's population and employment has grown faster than predicted. Projections keep getting revised upward.

The owner, SFPUC (water-sewer-power), does have a Commission, which is supposed to oversee and assure adequate planning for the future. Trouble is, the commissioners need not (and in some cases do not) know much about treating sewage. Questions during meetings occasionally evidence embarrassing ignorance. The Commission oversees and guides; but real planning for the future is up to staff and outside experts.

Outside experts do not mind steady work. Planning for a mere twenty years means that another round of planning is just around the corner. How nice.

Some matters seemingly not considered in sizing the new digesters to serve until 2045 include: higher projections for population and jobs (since 2013); whether the sewage load per person may increase; whether more salt water intrusion will affect the process; and whether more street trees (on land not presently residential) may increase sewage load, especially during first storms in Fall. (Sewage load per person might increase as humans grow larger, or if in the future more food waste goes down the garbage disposal.)

Ultimately it is the ratepayer who bears the burden of decision-making and planning for the future. So far rate rises have generally been kept to under ten percent per year. The long-term hope is to keep the cost of water and sewer service to less than 2.5% of median household income. (It is about half that today.)

Big projects generate big costs, and, unfortunately, have the potential for big cost overruns. The largest project in the recent, smaller water improvement program overran by more than 100%; the average overrun was 25%.

Let's hope that the biosolids digesters, subject of that thousand page tome, do serve adequately for what seems like a surprisingly short planning horizon of twenty years.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

July/August 2017

Winning, Losing and Somewhere In Between

Renewable Winner. Mayor Lee has announced that by 2020 San Francisco will obtain 50% of its energy from renewable sources. What does this mean?

First off, the Mayor is talking about electricity. San Francisco uses lots of gasoline, diesel, and natural gas all of which are sometimes considered energy. Not here. Secondly, this feat can be accomplished, it is said, partly because PG&E is raising its renewable percentage in compliance with a state mandate. While the mandate is to have at least one-third renewable by 2020, PG&E and other providers are ahead. The Mayor probably counts on at least 35%.

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Politicians eagerly take credit for what goes right. So far, CleanPowerSF, which the Mayor once opposed, is a winner. PG&E is saddled with expensive legacy power. Renewable power prices have dropped and are still dropping, favoring the new competitor."

Moreover, the Mayor counts on PG&E competitor CleanPowerSF to provide more and more renewable energy. Lately it is cheap. Also, CleanPowerSF is ramping up, and will serve more customers. Full reservoirs mean more hydropower for the next few years. Conveniently, San Francisco went to the Legislature to change the definition of renewable; with the change Hetchy power qualifies.

Politicians eagerly take credit for what goes right. So far, CleanPowerSF, which the Mayor once opposed, is a winner. PG&E is saddled with expensive legacy power. Renewable power prices have dropped and are still dropping, favoring the new competitor.


Affordable Housing. Supervisors and Mayor all favor affordable housing. Preferred flavors differ. More for very low income, or some for middle income? Two bedrooms (accommodating families) or more units? Inclusive, some within each building or development, or just maximize? Income levels set for each neighborhood or for the City as a whole? Preference for "neighborhood residents" in the lottery? teachers, first responders, vets? Maybe artists next?

With all these flavors to battle over, is the question asked: Is affordable housing policy working? Do the policies and programs provide affordable housing adequately? Or is the City failing, rather badly?

If we really wished to supply affordable housing there are simpler ways. Zone sensibly. Impose a (sliding scale) fee on new units renting for more than x, and a fee on units selling for more than y. Let the Market supply housing. The City incentivizes affordable housing, but lets the Market sort out the details.

Trouble is, were the City to incentivize affordable units City pols lose clout. No more special interests (teachers, neighborhood residents, etc.) to cater to; no developers walking the halls with checkbooks dangling. Nonprofits lose their purpose. A crisis solved is a political opportunity lost.

The City would still be involved in ameliorating disruption new development inevitably causes. But by incentivizing the housing the City wants, and leaving details to those who may profit or not, would there not likely be a more rapid response to a building need?


Groundwater. While this wet year is perhaps an unfortunate time to begin adding groundwater to the City's potable water, adding groundwater is the right thing to do. Few will notice. It is safe. While plenty of mountain water is available this year, the Hetch Hetchy supply is likely to be constrained in the future. The State's Bay Delta Plan proposes to require the Tuolumne River, from which our mountain water (now 85%) comes, to flow during Spring at a higher rate than it has been flowing on average. Our water system would lose most. Water authorities are negotiating a more sensible, and less impactful, resolution. Hopefully. Were they to delay including long-planned (and already delayed) groundwater, well, it would hardly improve their negotiating position. When asking the State to be reasonable, it helps to be reasonable as well.

The water supplies of many towns rely totally on groundwater. We are lucky to have mostly mountain water. Our water system is ready and able to include less than 15% groundwater in potable supply. Let it be.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

June 2017

Is Housing the Next Public Utility?

Is there a right to housing? If yes, then there must be a corresponding public duty to provide housing for all. Is this San Francisco’s emerging policy?

Once water was provided by a private corporation. Now providing water and sewer service is done by a public utility, SFPUC. Recently the selling of electricity, in competition with PG&E, has been added.

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While the average cost of water and sewer may not seem alarming, the $7 billion program to upgrade the sewer system has barely begun. At next rate setting, bills are sure to rise to make up for losses during the drought. It’s a public utility; costs must be recovered.”

Here’s what a recent progressive publication wrote on the matter: “What if we said that housing is a right in San Francisco? What if we demanded the public financing of public housing? What if we ran our own ballot initiative to create a fine on vacant buildings and real estate speculation? These are ideas that would garner wide public approval....” - San Francisco Tomorrow

Now, in addition to public housing projects, San Francisco provides limited “affordable housing” to winners of a lottery. To enter, household income must qualify. Some may win a favored place in lottery contests: certain neighborhood residents, for example, perhaps teachers in the future. If Supervisor Katy Tang has her way, soon housing will be provided for the “missing middle.”

Are public officials on the cusp of striving to house all comers? Public expenditure seems to grow and grow. While progressives are today not a majority, should that change, and should a progressive be elected Mayor, SF could declare a right to housing.

Yet while politicians strongly favor affordable housing, and housing for all, getting it actually done is not always a priority. Neighborhoods need to be consulted and the public process satisfied. Conveniently, this allows pols to be advocates while taking developers’ money. Champion a cause, and also attract contributions. What pol wants that gone? But will voters tire of inaction?

Decades ago almost all housing was supplied by private enterprise. Before “greedy” became the adjective that usually precedes “developer,” entrepreneurs specialized in developing property, often run-down, sometimes unoccupied, to meet housing demand. In those by-gone days, it was believed that the market matches supply to demand most efficiently. That belief faded. Today we look to government to provide. Market supply will never meet demand for affordable housing, it is claimed. Only wise government can match affordable housing supply with demand.

Except that so far government provides only a fraction of what is needed. Constantly, there is conflict about just what is needed, e.g. the maximum number of units, sufficient two-bedrooms so that families are accommodated, many smaller buildings or a few large developments? Micro-units? Elderly? Missing middle? Homeless?

There are always insufficient funds, even in good times with ballooning City budgets, to provide all with affordable housing. Too often, as government tries to do more and more, it does less and less well. Will San Francisco end up with tens of thousands of dull “council homes?” Will occupants, lucky lottery winners with qualifying incomes, decline promotions to stay within income limits? Will “neighborhood residents,” code for favored groups, get lottery priority, fomenting resentment? Will those who bring retired parents to town intent on entering and winning the lottery usurp the housing rights of long-time community members? Will the “non-profits” which actually build and manage housing for the City enrich officers of those “non-profits?” Will corruption emerge? What budget limits, if any, are there? Does the City spend whatever it takes to house all pursuant to an idealistic policy declaration such as, “housing is a human right?”

Questions need to be asked and answered before the City proclaims a right to affordable housing. But the day may be coming.

Highlights: SFPUC’s latest financial reports: During the drought, less water has been sold (and sewage processed); SFPUC liabilities have risen nearly ten percent. Despite selling less water, expenses have risen almost 2.4% annually over the past four years. The median water + sewer bill is $91 per month, or $1092 per year. Cost per person comes to little over a dollar a day.

While the average cost of water and sewer may not seem alarming, the $7 billion program to upgrade the sewer system has barely begun. At next rate setting, bills are sure to rise to make up for losses during the drought. It’s a public utility; costs must be recovered.

San Francisco is not alone. Huffington Post writes that nationwide, water bills could reach $170 per month over the next five years, a level considered unaffordable for 41 million Americans.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

March 2017

Water here, water there; water scare

While storms fill reservoirs and residents celebrate the obvious end of drought, ominous forces threaten San Francisco's water supply: The State is demanding more Tuolumne River water for fish and habitat.

If the State's proposed rule goes into effect, the voluntary rationing we've seen during the past few years of drought will need to be supplanted with much worse. Mandatory 50% rationing would be required, according to SFPUC, if demand returns to pre-drought levels. Even if demand were to stay as low as it has been with voluntary rationing, a further 20-30% cut in water usage would be needed. Required cuts would be devastating.

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Eighty-five percent of the water from your tap comes from the Tuolumne River ... If the system's ability to take river water is cut drastically, as has been proposed, San Francisco and its service area are in big trouble.”

SFPUC hopes to settle. Absent settlement, the future adequacy of our water supply is so bleak and dire that all hope seems pinned on settlement. Even with settlement, it will be "painful and costly," officials say.

How does this come about? For many years the San Joaquin River and Delta, and fish and habitat there, have suffered and declined. During very dry periods only very small numbers manage to reproduce. About two-thirds of the river water (the Tuolumne is tributary to the San Joaquin) is diverted for human uses. Federal agencies believe that no more than two-fifths should be diverted for a healthy river. It will take decades to repair the damage. The State has come out with a Bay Delta Plan under which 40% (30-50%) of river flow during February-June would flow unimpeded. In essence, our water system will get much less water than we have been getting.

Eighty-five percent of the water from your tap comes from the Tuolumne River. While there are other sources, local runoff and groundwater as examples, these pale compared to water from the river. If the system's ability to take river water is cut drastically, as has been proposed, San Francisco and its service area are in big trouble.

SF is nearly finished with an historic $4.8 billion upgrade of our water system. A $7 billion upgrading of the sewer system has begun. Rates have been rising rapidly, doubling every few years. Rates are certain to rise steeply for many years more. According to SFPUC, the median household pays about $1100 per year now for water and sewer.

If San Francisco settles with the State, as it hopes to, more storage capacity will be required. Water is stored in reservoirs, and also in underground aquifers. Increasing storage will be expensive. It is neither easy nor cheap to permit and construct new reservoirs. Dams have been verboten for decades, with almost none built. Yet there will be no choice. SF residents already use a remarkably low 41 gallons per person a day. While this number has dropped by 20 gallons over the past dozen or so years, it is just not realistic to expect it to drop much further. Water saving devices have been installed, and drought remedies taken.

San Francisco has junior rights to river water. Unless and until flows exceed a level, the irrigation districts, which own senior rights, get all the water. SF needs to capture and store water when flows are heavy. That has always been so, but with the State's Bay Delta Plan it will be more so. We will somehow need to acquire more storage at whatever it may cost. Also, we will undoubtedly promise to spend very liberally to repair and monitor the riparian system that nourishes the river and threatens fish. There really is no alternative.

All this comes at a difficult time. Global warming is likely to reduce the snowpack. Snowpack has been "storage" for our water system. Snows melt over time and water flows as it is used. Storms of this season had snow levels of 8500 feet, much higher than those of the 20th Century. More storage was probably a good idea even before the Bay Delta Plan threatened. But plans to build more were axed a dozen years ago, and now the water system faces double trouble.

At a Commission meeting in early January, dozens of concerned citizens spoke to the Commission, many favoring the fish and higher river flows. (Environmental groups mobilize the troops, and lobby effectively.)

No one can say how this will resolve, but expect the Bay Delta Plan and its effect on our Hetch Hetchy water system to be quite significant.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2017

This year’s columns in this space have focused on affordability. Water, and sewage, which rides along with water as the charge for it is determined by water use, is not a large household expense. But it is enlarging. Ten percent and more annual increases do that.

Today if you are a 4-person household living in a single-family home using 41 gallons per person a day, the city average (warning: single family households typically use more), you now pay about $1500 per year for water and sewer service. Next July rates go up nearly 12%. While future rates are not set (next: Spring 2018), expect similar increases for the foreseeable future. The seven billion dollar sewer program ensures that. Also, in the near term factors that have kept a lid on rates will likely reverse. Catastrophic events could add even more.

While you probably try to use as little water as possible, avoiding sewer blockage is also important. Many sewer lines were installed when water use was greater. Pipes that would flow at 7 gallons per flush may clog with 1.2 gallons per flush, especially if there is too much paper. Clearing a blockage can double your annual cost for water and sewer service.

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Might it make more sense to build for downtown workers on that church lot, given the short walk from Forest Hill station? Western neighborhoods should help homeless, but services are located elsewhere.”


Sea Level Rise. While rising seas expected over the coming decades will affect the east side of town much more than the west side, your pocketbook likely will not go unaffected. How will the city pay for the work required? On the west side, in the next few years wastewater infrastructure is at risk. The plan is to protect it for a few years with sand, and perhaps sandbags. Then an underground wall is to be built. This probably won’t cost more than $100 million. But eventually the Oceanside Treatment Plant may have to be moved. That would be costly.

Over the next couple of decades the Embarcadero Seawall needs to be repaired. That will cost $4 billion in today’s dollars, supposedly, if as seems likely it is raised a few feet.

But public works projects such as these tend to overrun in cost (and time) often by surprising factors. Example: the eastern span of the Bay Bridge: less than a billion originally estimated, but six billion and counting. Former Mayor Brown has said that the initial estimate is a “down-payment;” no one takes it seriously.

Should an earthquake shake the city, as seems probable, then costs will go through the roof.


It is interesting to watch the debate about developing the church lot on Laguna Honda, near ends of 7th Avenue and Clarendon, for 150 housing units: 30% to homeless, rest to low-income aged. Those high on the hill, away from the proposed development, find the proposal admirable. Those closer to it are often more NIMBY: great idea, but...density, hearings, consequences, not so hasty. Progressive San Franciscans value compassion, but...crime, traffic, buildings that don’t fit in, exceeding zoning height and type. Neighborhood change is resisted. Sure, SF should encourage lower greenhouse emission per person, lower water use, less miles commuted to work, all green goodnesses, but, please, without disrupting my neighborhood and life; we can’t accommodate unlimited population. Might it make more sense to build for downtown workers on that church lot, given the short walk from Forest Hill station? Western neighborhoods should help homeless, but services are located elsewhere. Back and forth we go. Perhaps experiencing the feeling of conflictedness teaches us why such problems are so intractable.


The growth of the financial sector is one of the stories of our time. Three percent of GDP in 1951, finance is now 9%. We are more mortgaged, have more consumer credit and debt, and owe much more getting educated ($1.3 trillion in student loans). We routinely lease or finance autos, furniture, and more. Government borrows for most capital expenditures; it is under-invested to meet retirement and healthcare obligations. Running up this debt has juiced growth; easy credit fuels business and job creation. Yet debt cannot grow endlessly.

Are we at a point where debt and credit growth have stalled? Did the financial freeze of 2008 spook financiers? Has our ageing society cut consumption? Addicted to digital devices, perhaps traditional goods are less compelling? With jobs in tight supply, and transient, lenders become nervous, borrowers grow more careful. Is the run over, or just in a lull?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

December 2016 / January 2017

We Play, You Pay

Once again SFPUC (provider of water, sewer and power) plans to grow. What bureaucracy does not? Once again the customer pays.

Staff has written a WaterMAP, which cleverly stands for Water Management Action Plan. This document recommends to the Commission, which directs policy, that SFPUC expand its water service. At present it serves the cities of San Jose and Santa Clara if supplies are available. These cities have other sources of water, but SFPUC meets a portion of their needs. Now it proposes to promise to do so in perpetuity in amounts up to 9.5 and 5 mgd (million gallons per day), or close to 7% of the volume of water provided to all customers.

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Cost has risen at far above the rate of inflation; the same is expected to continue for decades. During a recent period expenses were rising at about 10% per year. While San Francisco’s good times roll, fine. Trouble is no one foresaw the last two downturns.”

During a recent period expenses were rising at about 10% per year. While San Francisco’s good times roll, fine. Trouble is no one foresaw the last two downturns

Other needs are also to be accommodated. East Palo Alto asks for another 1.5 mgd, although it may buy or trade that assurance from another customer so that there is no net increase, or less than a full increase. Instream flow assurances have already been made, but not supplied; SFPUC has promised water to certain streams for habit and environmental purposes. That’s 3.5 mgd. Also, drought provisions are said to be onerous, given hardened demand. Harder demand occurs when water-reduction measures are implemented; it is no longer possible to forego watering a lawn replaced with cactus.

Where does the water come from? While SFPUC has a number of ideas, none are firm. Nor is the price of the water that will meet the new needs. But sure it is that customers will pay whatever it turns out to cost.

All this hits just as San Francisco’s ability to take Tuolumne River water — 85% — of the water served­ is in doubt. The state wants to address a crisis in the Delta and Bay. Fish are suffering, and the state wants more river water for them. This means less for our water system. The SFPUC General Manager says that if the state’s proposal is adopted and implemented, we lose 160,000 jobs and $40 billion, if the drought of late ‘80s-early’90s repeats. It could “cripple our Bay Area economy.”

One idea for providing more water, long in the works, is desalination. Enviros hate this. A new plant would be built, near water, with all the attendant disruption and permanent effect on the environment. Moreover, salty water is taken in (killing what small creatures?) and then brine emerges at the other end. (Where put? killing what?) Energy is used to pump water through filters, lots of energy. At least desal is fairly cheap. It could yield 9 mgd, a decent amount, but not enough.

Another idea long in the works is transfers. This is buying water, probably from the irrigation districts that have senior rights to Tuolumne water to which we havejunior rights. The problem here is, for years and decades we sue the irrigation districts, and do few deals. Also, when we want water, they do too. They would be affected nearly as much as we will be by the state’s Bay Delta proposal.

Beyond the perennials, desal and transfers, there is “potable reuse.” You really don’t want to know what this means. Who knows what this would cost or yield? (Yield of 5-15 mgd is mentioned; such dreams tend to shrink in time.)

But cost is hardly a focus. SFPUC does good things; cost is a detail. And that is the trouble. Customers are here to pick up the bill for whatever good things are done. The agency and its bureaucracy expand. Cost has risen at far above the rate of inflation; the same is expected to continue for decades. During a recent period expenses were rising at about 10% per year. While San Francisco’s good times roll, fine. Trouble is no one foresaw the last two downturns. Dotcoms were sure to grow at Moore’s Law rates, until in 2000 they didn’t. In 2008 the financial world panicked and froze. How quickly things change! One hard shake by earth or markets and titans of tech are rabble in the rubble. Then where are we?

Costs fearlessly undertaken during good times do not shake out. Indeed, if the shake up is physical they probably increase.

Today bureaucrats map expansion. Tomorrow, good times or bad, ratepayers pay.


What you pay for water over the years, and will pay. Here’s what a “unit” of water (one cubic foot, 748 gallons) cost over the past generation, in 2016 dollars: 1989-90 $1.09, 1999-2000 $1.77, 2009-10 $2.89, and 2016-17 $6.00. During the current rate period (4 years) rates are rising at 10% per year. The rate study for the next set of rises has begun. As revenues have come in short, and wholesale customers prepaid, expect sizable increases. Sewer rates will likely rise faster than water; $7 billion in updating has begun. Some tweaks under consideration: storm water extras, extra charge for stronger or more difficult sewage, and rebates or credits for “sustainable” improvements.


Crystal Springs Reservoir. Most of our Hetchy water system’s storage is in the “high country,” in the Sierras, but some is “local.” The two largest local reservoirs are Calaveras in the Sunol Valley, and Crystal Springs Reservoir south along I-280. It was proposed that land around the Crystal Springs reservoir be opened for hiking and recreation; three Supervisors sponsored a resolution. It was defeated (actually tabled). Whether to promote recreation, or whether to best protect water supply, is a perennial question. (There is and remains limited rec opportunities at Crystal Springs.)

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

November 2016

It's a Bird­ — It's a Plane — It's SFPUC Salaries!

SFPUC employs more than 2500. Median salary is $92,762. Add benefits worth $36,669. And sometimes overtime.

The General Manager makes salary of $326,000, total $420,000. All figures are for 2015/16, and following figures are in thousands, and are examples; not every employee so categorized makes the same. When one figure is given it is total compensation, including salary and benefits; when two figures are given, the first is salary, the second is total compensation with benefits and possibly overtime too. Account clerk 88.9, accountant II 118.9, accountant III 139.3, accountant IV 162.9, administrative analyst 121.2, administrative engineer 198.6, associate engineer 235.9, clerk typist 87, executive secretary 127, communications systems tech 190, construction inspector 100.4 / 204.4, coordinator of citizen involvement 110.9 / 160, engineer 134 / 191.7, engineer 174 / 236, engineer 180 / 266, IT operations support 113.5 / 160, junior engineer 88 / 127.5, manager 216.9 / 296, planner 127.4 / 174.7, project manager 187.5 / 253, public relations officer 95.2 / 137.7, safety officer 136 / 188.6, senior construction inspector 110.7 / 199.2, water service inspector 100.6 / 150.9.

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On a per capita basis, you already owe $5880 for water and sewer stuff, with that to more than double as the SSIP progresses. Thank you for you generous support!”

The take-away is that not only are our bureaucrats quite well fed, but also (last month's column) they are generous with spending your hard-earned dollars in plenty of ways.

Rate revenues must recover costs. That's basic.

Greens believe water is too cheap. Fourteen years ago voters abandoned their right and duty to approve or disapprove SFPUC debt spending. So it's little wonder that in an increasingly wealthy city SFPUC bureaucrats go a little hog wild. Progressives might prefer to oppose high rates—but for their alliance with Greens. In return, Greens, who might promote urban living over suburban, abjure the urban development progressives abhor. The third partner in the alliance, Liberals, are for civil rights and unions; African-Americans receive "community benefits," and they and unions get SFPUC jobs. So while Greens, Libs, and Progressives ally to each obtain from government (SFPUC) what they want, ratepayers get...the bill.

SFPUC has adopted a new debt policy. While in general its finance folk are excellent, hailing from Ed Harrington, this is the fourth revision in six years; policy tends toward more and more discretion. Board of Supervisors need no longer approve issuance of bonds (by two-thirds vote). (Bonds are debt.) The General Manager has discretion to sell bonds without competitive bidding. Need SFPUC own the capital improvements for which it issues debt? It is not apparent. Green bonds are specially enabled for renewables; revenues (rates) must pay them back. Need SFPUC take bids for its debt-financed work? No; a billion dollar project is to be awarded without, to a "construction manager/general contractor."

Debt for the water and sewer systems now exceeds $5 billion. While the big program for water approaches completion, that for the sewer system is in beginning stages: 11% of the $7 billion projected cost has been spent so far. More debt will be sold as the Sewer System Improvement Program (SSIP) progresses. On a per capita basis, you already owe $5880 for water and sewer stuff, with that to more than double as the SSIP progresses. Thank you for you generous support!

Last month's column reviewed extravagances of SFPUC (the city department providing water, sewer, power service). Rates must cover those costs.

Drought: As of September 3 our water system had 380 billion gallons stored. The system uses about 77 billion gallons per year; more than four years' worth are stored.

Streetlights: San Francisco has about 44,000 street lights, and they are changing. LED lights are being installed to use less energy, lower maintenance cost, and provide jobs. Nearly one-thousand have been installed by SFPUC; more are coming. SFPUC owns 57% of the street lights; PG&E owns 43%. In addition, some poles will be licensed — will have extensions — which will provide revenues of a couple of million dollars per year. Generally the process of changing a cobra lightbulb to LED is one that takes under an hour, and disrupts the neighborhood minimally. However, if additional work is indicated, it can take much longer and be more disruptive.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

October 2016

Down the Drain

This column concerns affordability. Water, power and sewer rates have been rising far faster than inflation, and will continue to do so indefinitely. The percentage of the median San Franciscan's income to be consumed paying water and sewer bills is expected to double—from 1.2 to 2.5%. That's the plan; but public works often overrun.

Why are water and sewer costing more and more? There are good reasons, and not so good ones. The systems are old; the public expects more. Not so good reasons, however, call for discussion, following:

SFPUC (water, power and sewer service providers) is exempt from voter approvals. Most major public projects require voters to authorize bond issuance. Renovate City Hall? Voters okayed bond sales. Build a new stadium? Same. Even filling potholes has come to be done with bond money (debt) and needs voter approval. Officials know that voters will approve almost any debt for libraries, parks, and schools; often they spend elsewhere, then ask for bond financing for the gimmees.

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But while officials ask for $300 million here and there in almost every election — for the sewer system, $7 billion — that's 7,000 millions — goes right under the ballot radar.”

But while officials ask for $300 million here and there—in almost every election—for the sewer system, $7 billion—that's 7,000 millions—goes right under the ballot radar.

Not only is this a huge amount of debt incurred, but also by not running it past the voters bad things happen. There is complacency. No need to use annoying competitive bidding to let a billion dollar contract. Use a method that limits competition, competitive procurement. Less likely to get a difficult contractor.

Also, before procurement, let's travel overseas to visit cities with the fancy new system being purchased. It's not only foreign travel. Top administrators also have their own Hetch Hetchy destination. This past spring, top dogs stayed up in the mountains—for less than $60 per night. Not only Commissioners, but also past general managers, Susan Leal and Ed Harrington, and many other top employees enjoyed this perk of SFPUC. Why not? SFPUC is off the voters' radar.

Because it need not obtain voter approval before incurring huge debts, SFPUC has come to fill other City functions as well as those it has had all along. Fire Department financially stressed? Give its auxilliary water system to SFPUC. Street sweeping costing DPW too much? Double SFPUC's payments for that. Need neighborhood street trees, but lack ready funds? SFPUC. Jobs, "community benefits"—SFPUC can and does help. Just add it to the debt and higher rates will pay that off in the future.

Too, a new headquarters building was de rigeur. No ordinary one would do. First SFPUC paid $10 million for a property the City got for free. Then SFPUC gave its headquarters plenty of bling. It has a wind-machine covering one side for making power (it doesn't work), solar panels, waterless toilets and a green machine (stinks), and lots and lots of art. Do visit 525 Golden Gate, see what you think. Although the building is but a few years old, recently structural engineers have been hired; we shall see where that leads.

SFPUC's Mission Statement no longer clearly address affordability. "To provide our customers with high quality, efficient, and reliable water, power, and sewer services in a manner that is inclusive of environmental and community interests and sustains the resources entrusted to our care." Is the word "efficient" to cover affordability?

Concerning the next round of rate setting for water and sewer service, the SFPUC recently received a telling staff memo. In part it states: "multi-year rate increases are anticipated to be necessary to cover the cost of large capital plans and increasing O&M [operation and maintenance] expenses. In the course of the [rate consultant's] Study, Commission input and direction will be sought regarding a range of policy issues, including those related to evolving legal requirements, the lingering impact of the drought on the SFPUC's finances, and changes to industry practice in areas such as affordability, stormwater management, and conservation incentives. This memo outlines the scope of the upcoming study…."

Addressing challenges, the memo continues, "exceptional levels of water conservation, large capital plans, the convergence of water and wastewater management strategies, and the deployment of green infrastructure represent significant adaptive challenges to [SFPUC]." Bet that an "adaptive challenge" comes with a big price tag.

How may you be affected? Rates will rise, of course. But also if you plan to develop property, for example adding a unit to rent, you may be charged more than previously for future expansion of the systems (capacity charge). Upon sale of your property you may be required to inspect your sewer lateral, or begin paying for insurance against failure. Stormwater may be charged separately from sewage. During drought, there may be a surcharge added, so that SFPUC revenues do not decline as severely as they have recently. If you qualify as low income, you may enjoy lower rates and charges. In other words, SFPUC will likely follow the airlines: fees and added charges, balanced by a bit of helping those who struggle—and know how to work the system.

Practical advice to reduce your bill: For those whose water use includes significant water for landscaping, did you know that your sewer bill—which is tied to water consumption—can be reduced? The default is that you are billed 90% of water usage; the volume that goes down the sewer is assumed to be nine gallons out of ten. But, you can have that changed. A home with gardens and out-door plants might win a factor of 75%. Use 4 units of water (about 3000 gallons), and instead of being charged for 3.6 units of sewage you would be charged for 3 units. You will need to fill out a declaration, and be subject to inspection to verify use. You file a "flow factor appeal." Go to, customer service, rates, single family, and find the flow factor appeal link.

Steve Lawrence is a Westside resident. Feedback:

September 2016

Great Sums of Public Money End Up Flushed

Over the next two decades SFPUC expects water and sewer rates to rise 7% per year average, three-and-a-half times inflation. Increase that number if there are overruns on the $7 billion SSIP (sewer program), or "extras," such as better flood protection.

Rates have been rising fast. These past few years you have used less water, which has lowered your bill, but that is temporary. SFPUC's costs are fixed; if it sells less water eventually it must do so at a higher price to recover costs. Reserves, which have been filling in during drought, won't last. The average bill is going from today's $51 to over $200 in twenty years.

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Flooding and inadequate capacity troubles are occasionally ugly and smelly; they will get worse unless remedied. No one opposes the SSIP (Sewer System Improvement Program). The trick is getting it done without many overruns, and fairly—without favoritism, waste, and corruption, and without public employees living far above private San Franciscans.”

Modern civilization rests on a broad foundation, one that can fail in a trice. Without water and sewer life gets ugly fast. San Franciscans know that relying on a private water system (Spring Valley) did not work in 1906. To be prepared, the miracle which we enjoy today, the Hetch Hetchy water system, was created. By drowning a beautiful valley, and using a corner of Yosemite as watershed, San Francisco acquired a system that supplies crystal pure water and generates electricity. Generations have enjoyed the benefits. After spending $4.8 billion to upgrade the system, there is hope that generations to come will, too.

While the sewer system remains to be upgraded, the Sewer System Improvement Program (SSIP) is launched and is underway. It is expected to take more than two decades to complete, for $7 billion. Digesters, the heart of the system, are old and require replacement. Flooding and inadequate capacity troubles are occasionally ugly and smelly; they will get worse unless remedied. No one opposes the SSIP. The trick is getting it done without many overruns, and fairly—without favoritism, waste, and corruption, and without public employees living far above private San Franciscans.

What have we in place to prevent waste, corruption, favoritism and over-spending? Not much. Hopefully our public servants are civic minded and upright; but where there is opportunity.... There is a Commission of five that meets twice monthly. Commissioners have their specialties, e.g., environment, union, etc. There is a Revenue Bond Oversight Committee that meets five times a year; don't count on it. There is a Citizens Advisory Committee which does not look into money matters. The Mayor might intervene if spending becomes too outrageous. Rates rise in the distant future.

Today, the major supplier of engineering services, URS, was in 2014 acquired by prior competitor AECOM, which is now dominant. Construction contracts are now let not by the old competitive bidding system, but by a looser method that considers factors other than price. How easy is it to steer contracts to a favorite when there is no low bidder. As always, change orders aplenty will inevitably be requested and granted; how easy it is to spend ratepayer money doing a "good-guy" a favor with a generous change order. Public contracting is not the essence of efficiency at best; at worst, great sums of public money end up flushed.

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Do you know what June's Prop A does? Nearly 4 of 5 voted YES. All the city names were for it. $350 million in bonds are to be sold. For? Public health and safety. What's that? Do you have adequate assurances that it will be well spent? Were there experts assuring you of the need for the spending? What is planned? Is there a definite list of projects or uses?

Nearly four in five voted YES whether or not any of these questions were answered satisfactorily. Back at the turn of the Millennium when voters were asked for bond authority, there were expert reports, lists of projects, and public meetings to answer questions and explain the use of funds. Today, who needs all that when nearly four of five will vote YES with a dozen colorful mailers with a proud list of known names supporting?

More than three-quarters of Prop A funds are to improve earthquake and fire safety systems at General Hospital, and (all lumped together) renovate and expand the Southeast Health Center and other high-demand neighborhood health clinics. $20 million to homeless shelters. The remainder, $58 million, to build a higher-capacity, more efficient and seismically-safer facility for City-owned ambulances. Hopefully you knew that. Did you also know that a 2008 proposition provided $888 million for "building a new hospital" at SF General? Do you understand why there is—so soon—a need to improve fire safety systems?)

Prop A always is supported by the big names. Prop A always wins, regardless of its merits.

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This year's city budget is $9.6 billion, about $11,300 for each resident. Spending on homelessness rises about 17%. Will that do the trick? At 440 Turk a new office building will rise for the Dept. of Homelessness. After the November election, sales tax in the city will rise half a percent, which is .75 up, partly offset by expiration of a state component, .25 down.

Affordability is not only housing.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

July 2016

Green Head

About five years ago SFPUC (water, sewer, power) opened its splashy new headquarters building, 525 Golden Gate Avenue in the Civic Center. The $200 million edifice came with much-heralded green bling, helping to make the building a prize winner, proudly certified LEED Platinum. How thrilling! How do the green machines perform?

Not so well. Solar panels did okay, but an "inverter" is needed to produce usable electricity. That overheated. Air conditioning had to be installed. The inverter's provider went bankrupt; parts are unavailable.

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In 2002 SFPUC obtained relief from having to get voter approval for going into debt. That enabled expansion of the agency… An expanding agency wanted new digs, and green credentials. Its headquarters is glamorous … It's all part of what you pay for when you pay your water and sewer bill, or your rent.”


Wind turbines on the side of the building make a flashy addition. These did spin, for a year. However, they were "not operated for meters" (sic); this portion of power generation was not installed. Just what this means is uncertain, but one gathers these fancy turbines did not actually generate electricity. It was discovered that engineers cannot safely access the turbines. And, the internal memo setting forth findings concludes that urban wind is just not a viable generation source. All show, no glow.

The Living Machine recycles waste water for use on plants, and for reuse in toilets. It is said to have worked pretty well, and been a leading example of how other buildings can use non-potable water. The Living Machine is said to have offset 2.3 million gallons of potable water. But, fixtures and fittings have corroded throughout the building. Many have been replaced. Also, access to the machine's equipment turned out to be difficult, requiring improvement. And there were problems with odor. An air intake pulled bad odors back into the building, necessitating the raising of piping. Too, redundant pumps were not installed (as is usual practice in wastewater treatment), and when one went out of order the whole show closed. Backup pumps have been purchased and stored.

In 2002 SFPUC obtained relief from having to get voter approval for going into debt. That enabled expansion of the agency, which provides water, wastewater treatment, and power for municipal use, and now for a portion of the city's private uses under the newly launched CleanPowerSF. An expanding agency wanted new digs, and green credentials. Its headquarters is glamorous. When in the Civic Center, visit the cafe, the building's artwork (appointment required for that), and observe the green machines. It's all part of what you pay for when you pay your water and sewer bill, or your rent.

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Drought update. By mid-July our water storage system is likely to top at about 80% full; if weather and snow melt is favorable, perhaps 90%, or more. The system can store 293 billion gallons (not including the water bank at Don Pedro). Recently the system uses about 77 billion gallons per year. (Note: Not all stored water can be drained without serious harm to fish and perhaps facilities. The timing of snow melt can affect how much water is San Francisco's, and how much belongs to irrigation districts. Don Pedro is owned by irrigation districts; SF can bank up to 176 billion gallons there.)

WSIP update. The Water Supply Improvement Program was again revised. SFPUC began in 2003 intending to finish in 2015. The program underwent a major revision in 2005, when it intended to finish up in 2014. Since then the program has undergone a series of revisions, the latest of which has the program finishing about 2020. Cost is up again as well. Cost went from $3.4 billion in 2003 to about $4.8 billion now. Scope of work has both increased and decreased; in terms of the amount of water the system can carry, it has decreased about 15%; environmental work and more has been added to the program.

BAWSCA, the agency that is sort of a union of the water system's wholesale customers, is watching carefully. It plainly does not like the latest revisions, which however are necessary and at this point unavoidable. It seems to distrust SFPUC to act in its best interests. (SFPUC has what amounts to a trust relationship with its wholesale customers.) In particular, BAWSCA fears collapse of the Mountain Tunnel, which would cut them and us in SF off from Hetchy water. BAWSCA insists on an adequate emergency plan for how to act should the vulnerable tunnel go down. Fixing Mountain Tunnel was once in WSIP, but the project was removed in the major 2005 revision.

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Unaffordable housing. Your correspondent has spent inordinate time untying the Gordian Knot of SF unaffordable housing. Finally, light! Eric Fischer has done amazing yeoman's work and statistical analysis, and has made sense of and shed real light on the city's housing situation. What causes high rents? Is it the NIMBYs? Rent control? Red tape? What? Frustratingly, especially after such impressive work, no path forward clearly appears.

Perhaps the path we've been on, hard as it is for me to say this (with my market bias), is the best available. One commentator discussing Fischer suggests that focus on techies (high earners) explains much. He ends up suggesting housing for each "class" (my term, not his): Housing for the poor; housing protection for middle income; housing for techies, i.e., market-rate housing. It's a brave new world.

(Fischer concludes that three factors predict rents in SF, number of housing units, gross salary of workers, and number of jobs. Rents rise at a surprisingly consistent 6.6% per year, considerably higher than overall inflation. Since 1960 rents are four times higher. The trend seems inexorable, and to reduce rents back to one-third of what they were—to mostly return to the good old days—would require what no one wants—fewer jobs, lower pay, or a huge increase in units.)

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

June 2016

Seven Maids with Seven Mops?

The public works program to improve San Francisco’s sewer system has been revised again. The program, which goes by the acronym SSIP, for Sewer System Improvement Program, is a seven billion dollar, thirty year set of projects. Most is to be done within twenty years. During this time an average of about $300 million per year will be spent on sewers; spending in early years should exceed that rate.

Normally voters would need to approve such spending, which is mostly funded with bond indebtedness. But in 2002 voters gave SFPUC, the entity responsible, a blank check. No voter approval is needed. So you may hear little about the SSIP program.

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Digesters reduce the solids. Bugs consume the organic matter. The dead bug bodies emerge as sludge, which can be used as fertilizer.”

Early on, new digesters are to be built. Digesters are the heart of a sewer system; actually, they are more the “stomach” as they digest. Sewage is separated, solids from liquids. Digesters reduce the solids. Bugs consume the organic matter. The dead bug bodies emerge as sludge, which can be used as fertilizer.

The digesters now working were built in the Fifties. The new ones will use a modern process. Dewatered sewage will be heated. This allows the digesters to be smaller and more efficient. Cost of the six new digesters approaches two billion dollars. Construction work begins in three years, and is to be completed by the end of 2025. Then there will be a two year transition from old to new digesters.

Digesters are the largest single expenditure, but not the only one. The main sewage treatment plant (called Southeast) is old and will be upgraded. Also the sewer lines themselves, called the collection system, together with storage, will be improved. Because San Francisco combines stormwater with sewage, the system goes from handling low flows during dry season to dealing with high volumes when storms come. So the system must deal with both stink (odor control) when flows are low, and flooding when flows are high. A few neighborhoods are very aware of these problems. SFPUC will try to remedy: More than $200 million is to be spent on “flood resiliency.” (Planned flood projects, cost in million dollars, year(s): Folsom/17th 255m 2020-4, Wawona 23m 2020, Cayuga 8m 2019, other 8m.)

Every public works program has come to have “goals.” These range from the obvious, meeting state regs and reliably treating sewage, to goals such as creating local jobs. The updated SSIP adds a goal of anticipating rising seas. Although the sea level here in SF has risen remarkably slowly to date, that is expected to change soon. So preparations are being made. Sewers discharge to waters, and sewage flows downhill to elevations at or even below sea level. A rising sea can mean contamination with deadly salt water. By adding this new goal bureaucrats ensure their employment. They will keep busy evaluating the costs and benefits of various project alternatives. On the one hand, seas may rise slowly, so a less costly alternative may be worthwhile; on the other hand, a more costly alternative might better protect from fast rising seas.

Overall, the cost of the SSIP program is up just a bit from the last iteration (2012). But as with all public works, it’s not what the cost is hoped to be, it’s what it actually costs. The water program’s (WSIP) cost rose by about 40%. Perhaps SFPUC has learned from that and can do better. But, working in a densely populated city rather than mostly out in the sticks, perhaps costs will rise more.

In March $621 million of bonds were authorized to be sold to finance near-term SSIP projects.

Congratulations for reading about sewage treatment, hardly the sexiest topic. But it’s important: Without good sewage treatment the flow of modern life goes quickly down the drain.

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Are colleges poisoning politics? For a generation or two college has been a place where tolerance of unwelcome views is in short supply. Micro-aggressions are the latest newsflash. Punishing controversial profs and would-be campus speakers is familiar news. Has college intolerance seeped into Congress, and into our national civic discourse? Write to me.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

May 2016

Drought Recovery and Flood Prevention

Soon the drought is likely to be over for San Francisco. In the course of delivering a report about the drought to the SFPUC Commissioners, the head of the water department characterized the snow pack. While there is still considerable uncertainty about how much water will flow into the SF Hetch Hetchy system, if the “medium” estimate turns out to be right (there are high and low estimates too), about one million acre feet of water will be available. To fill system reservoirs takes about 810,000 acre feet. Chances are, by July 15, reservoirs will be full. This forecast was given in early February; weather may defeat expectations. Note, too, that this is for San Francisco; much of the state is not in our enviable position. The Hetchy watershed is blessedly high in elevation. As of early February our water system had already captured 82,000 acre feet of water, more than captured over the past two years. (SF’s water system delivers about 250,000 acre feet per year to well over 2.5 million customers.)

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Proposed projects will vary in terms of effectiveness and cost; those believed most effective will cost more. Costs are all in the hundreds of millions of dollars.”

Now for the less welcome news: about flooding. San Francisco has a combined sewer system, unique in the West. This means that storm water flows into the same system as does wastewater (sewage). While that can be good – both are treated – it is difficult, too. SF processes 60 million gallons on a typical day. But when it storms SF must process much more. The system max is 550 million gallons, so about ten times what is typical. Yet even that is not enough when it rains hard. Torrential rain may be increasing with climate change. In February 2004 a 100-year storm hit. In December 2014 two 25-year storms hit within a fortnight.

The SFPUC Commission, which sets policy and makes big decisions, is committed to addressing flooding. It will be neither easy nor cheap.

There are three areas particularly vulnerable to flooding, one on the Westside, and another nearby. Wawona and 15th Avenue has flooded badly and remains vulnerable. An area at Cayuga near 280 is not too far from the southern Westside; this place floods during bad storms, such as the recent 25-year storms, and when it does, the effects are quite bad. (Another flood-prone place is Folsom and 17th St.)

Underway for SFPUC is a flood resilience study, due to be completed this Spring. After considering the study, projects to address flooding will become the focus. Proposed projects will vary in terms of effectiveness and cost; those believed most effective will cost more. Costs are all in the hundreds of millions of dollars. (The General Manager even breathed a billion dollars.) For each ten million dollar cost increment, expect your bill to rise by a couple of dollars a month. Fortunately for today’s bill payers, none of the projects will be done before 2019. (Not that remediation has been foregone; $150 million was authorized after 2004, more since. About $23 million has been spent/committed to address flooding at Wawona and 15th. )

Even with the coming expensive flood control projects, flooding will occur. The aim is to have no significant flooding in a 5-year storm, 1.33 inches of rain in three hours. But there are larger storms. Then the aim is to reduce and minimize the damage of flooding. Preventing flooding altogether is too expensive.

For individuals who have experienced flooding at their property and wish to take steps to avoid it, there are grants of up to $30,000 available. See Grant Assistance for Floodwater Management within

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

March 2016

But Can We Afford Success?

Two water years ago the city and its wholesale customers were charged with reducing water consumption to 209 mgd (million gallons per day). The system is designed to deliver 265 mgd. We actually reduced to 203 mgd, about three percent better than target. Last water year we reduced three-and-a-half percent further to 196 mgd. City residential use was at 37 mgd, 44 gallons per person per day.

These are remarkable accomplishments unheralded in fear that drought efforts will slacken off.

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…it is a good bet that ways will be found to transfer some of the coming cost tsunamis to Westside residents, who are reaping higher property values...”

One consequence of customers’ excellent conservation is that revenues have fallen short of expectations. As costs are fixed, the shortfall must be made up. That means that when rates rise they will do so more than expected.

Consequently, at their early January meeting, commissioners heard about “long-term financial sustainability.” Something must be done to bring revenues up. Various ideas were discussed.

One idea is to specially recognize storm water costs. Dealing with storm water is part of what the sewage system (wastewater system) does; stormwater cost is now recovered, undifferentiated, in sewage rates. Storm water costs are about twenty percent of all wastewater cost. But there are differences for different parts of the city. Storm water might well be a greater contributor to cost on the Westside. And that cost may grow. Should the Lake Merced Tunnel need to be moved eastward—it is too close to the raging and rising ocean—this large cost might be designated a storm water matter for which the Westside customers should be responsible. If the Commission separates storm water cost from general wastewater treatment cost, future Westside bills might be going up even faster and higher than they are sure to given the present shortfall of funds.

Not only is there a shortfall of funds today, but also the SSIP program, $6.9 billion, is just getting underway. Debt service cost has risen by multiples over the past few years, and will rise much more. Remember, too, that while $6.9 billion is a big enough number in and of itself, such programs tend suffer cost overruns. The cost of WSIP (the water upgrade) rose by more than one third. Potential for unexpected trouble may be greater when working in a crowded city environment. Should 6.9 billion rise 40%, that becomes $9.66 billion. Over twenty years that is close to half a billion dollars per year. (Most will be financed over 30 years, not paid for currently.)

With all the concern that has been raised about unaffordable housing, and with the burden of new housing falling most heavily on the east side of town, it is a good bet that ways will be found to transfer some of the coming cost tsunamis to Westside residents, who are reaping higher property values and are generally (viewed as) better able to afford higher costs.

Storm water is the first wave of the coming storm. Be prepared.

* * *

Affordable housing. Where are we re the mayor’s quest for affordable housing? The mayor has set a “critical priority” goal of 30,000 housing units by 2020, at least one-third of which are to be “affordable.” Assuming that’s by the end of 2020, proportionally as of last September we’re short by about one-eighth towards reaching the 30k goal; affordable units as a percentage of those built are short by a fifth. The city needs to build faster and more affordable units for the mayor to meet his critical priority.

Maybe one reason the mayor is behind is that of his seven point plan three points do not pertain to building more (affordable) housing. Focus?

The mayor wants more money and more staff. It is government that leads and provides housing; private enterprise is only a necessary evil to tolerate—maybe. That and a cash cow.

San Francisco is suffering symptoms of a surfeit of success. Right now we’re rolling in dough. Yet government wants more. Government has grabbed the role of providing affordable housing. When bust eventually arrives, where will that expansion leave the city?

How does one get affordable housing? Apply, and then be relentless. It’s a new day. No longer do you earn, save, and engage a realtor. Low earnings are good. Luck is too; it’s a lottery system. Pluck is paramount.

First you take a course (see Mayor’s Office of Housing). Then you go to counseling. These first steps are but necessary prerequisites. Determination is next, and lots of applying and follow-through.

The system has been criticized for failing to distribute affordable housing equitably to all groups (disparate impact). Playing the game successfully requires patience and tenacity.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2016

What’s a couple of hundred million bucks?

To you and me it’s a fortune. To the City it’s not worthy of much notice.

The Water System Improvement Program (WSIP) started off in 2003; it was to cost $3.4 billion. The program’s cost gradually escalated; now it is $4.8 billion, up about 40%.

What became the largest project, Calaveras Dam, is the one that has added most to the cost overrun. Back in 2003 a new Calaveras Dam was to cost $150 million, and was to increase water storage capacity. In 2005 the new reservoir was downsized.

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When the city wants something, but lacks ready funds, why not … put it on your bill?”

When bids came in for the new dam, construction was to cost $256 million. As work progressed that cost doubled to probably $540 million. Why?

The technical term for the big bucks changes is differing site conditions. What this means is this. When contractors bid for a project they rely on information given to them by the owner. The owner hires geotechnical engineers to drill test holes to determine what is under the surface. This information is provided both to designers of the dam, and to contractors bidding for the work. The idea is to insure the contractor against surprise. If the actual conditions encountered differ materially (significantly) from those expected per the information the owner provides, then the contractor may be entitled to an increase in contract price. There are limitations. For example, the contractor is supposed to visit the site or work, and is charged with what can be seen and found out.

At the Calaveras Dam site, a slope at what is called the left abutment was designed very steep. Surprisingly steep. On highway projects slopes are rarely steeper than 2:1, which is steeper than you can walk up. But this slope is in an earthquake zone, right near a fault. The rock material is crumbly and loose, no doubt from milleniums of quakes.

The contractor started constructing (shaping) the slope and encountered safety issues. The slope was too steep, and the rock too loose for safe operation of heavy construction equipment. The contractor picks the means of construction.

Was what the contractor encountered a surprise? It seems quite doubtful.

But SFPUC, the owner, quickly agreed that the contractor was entitled to extra compensation for a differing site condition. Then the change order grew and grew. Much more excavation had to be done to achieve a more gradual slope.

When a contractor is paid like this, by “change order,” it is generously compensated. The contractor need not competitively bid the work. Payment is “cost plus.” There is no pressure to work at optimal efficiency. The contractor gets paid more for more work, and workers keep their jobs for longer. A win-win. For contractor and workers. Not so much for the owner, or its payers—you.

In addition, the material excavated at the Calaveras Dam site could be valuable. The contractor may get paid first to remove it from the dam project site, and second, it might sell the removed material. That would make the extra excavation a very good deal indeed.

Why a differing site condition was quickly conceded is a mystery. But it was a very expensive decision that has turned into a couple hundred million bucks.

Yet despite the big cost to the rate payers, no one blinked an eye at the Calaveras change order. The Commission showed no particular interest; nor did the Revenue Bond Oversight Committee, nor the Citizens Advisory Committee. Hey, it’ll just increase future water rates; what, we worry?

Oversight groups are largely emasculated here in SF. Relying as they do on the bureaucracy for so much, waves are not made. In other cities, and perhaps at other times even here, such a large project loss would not go uninvestigated.

* * *

Are your payments for water used wisely? More than eleven million dollars is to be spent for the protection of the San Francisco garter snake and a thistle. Snake and thistle habitat are said to be threatened by “invasive vegetation.” Removal of the invasive vegetation is being done under the “Bioregional Habitat project” of WSIP, a project created under the leadership of General Manager Susan Leal. The project grew from nothing to over $100 million dollars, one more reason the cost of WSIP has increased.

Under Ms. Leal’s leadership, SFPUC eliminated upcountry projects from WSIP. One was fixing the Mountain Tunnel. Now the project to fix that has become much, much bigger. An engineer has just been employed for $21 million just to plan and design the fix; that does not include the construction work. When in 2002 voters authorized money for the fix, about 2.5 million was the expected cost.

Water rates and charges are rarely questioned. When the city wants something, but lacks ready funds, why not see if SFPUC might do it, and put it on your bill? Like a snake in the grass, maybe it will slide by.

* * *

SFPUC’s annual budget is a skitch under a billion bucks. A little over half is for water, $273 million for wastewater, $130 for power (that will increase when CleanPowerSF launches), and $105 for other. It’s a big agency. No voter permission is required to spend, even when debt is incurred.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

December 2015

Sewer Spills and the Sand Solution

San Francisco has a combined sewer system. This means that both home sewage and storm water combine together and need to be treated. In summer months little flows. During winter when it rains, an awful lot flows. Problems flow, too.

To deal with extreme variation in flow, storage containers are employed. Combined wastewater and stormwater fillsthe container. If the container fillscompletely, the top liquids flow off untreated; the bad stuff tends to settle. Such releases of untreated wastewater are spills. Spills are limited in number by regulation.

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In 2009-10 the ocean took part of Great Highway, and it did so very quickly. This winter could be as bad, or worse.”

In the late 1980s and early 1990s, the Oceanside treatment plant was built next to the Zoo to improve treatment and reduce spills of untreated wastewater. Along with the treatment plant, which treats wastewater and discharges it through an outfall into the ocean, a storage facilitywas buried under the Great Highway. This storage facility is called the LMT, Lake Merced Tunnel. It is not really a tunnel, though were you in it, it would feel like one. It is a large diameter concrete pipe.

The pipe is located too close to the ocean. It is vulnerable to rising seas, and to intense storms which can batter the coast. Coastal erosion has become a real problem; as it happens, it is worst just to the west of the LMT.

At present, at the closest, there is 59 feet between the beach and the buried LMT.

To support the LMT and keep it from bursting, experts say that ten feet of soil provicing lateral soil support is required. Otherwise the pipe is liable to burst.

Why would such a pipe burst? After a large storm it is filled with liquid. This is heavy. It places a downward and outward force. Imagine a balloon over-filling with water; it expands, hangs lower, and bursts. Same with the LMT, unless there is resistance (soil) to counteract the liquid’s force.

With 49 feet of excess soil at present, you might imagine all is well. But during the 2009-10 year, reports were that the coast eroded 40 feet; one report claimed seventy feet.

So what if the storage pipe collapses? It would be a very big deal. Not only would the city pollute the ocean and beach with wastewater, but also it would lack storage and spill in each subsequent storm. That would be intolerable to regulators, and to residents. Emergency measures would need to be mobilized, and the cost might run into the tens of millions, maybe more.

A couple of years ago a plan was devised to deal with rising seas at Ocean Beach. Called the Ocean Beach Master Plan, it did address the need to protect the vulnerable LMT from rising seas. Some steps have been taken. But they are baby steps. Sand has been transported to the beach west of the LMT.

But sand is scoured away by a stormy ocean very quickly. The sand placed is fine sand, which goes more easily. Under the influence of high tides and a typical southwest El Nino storm, the ocean can rise up and scour from south to north, pulling beach sand north and west. Once the sand is eroded away, the cliffs may slide and break off, and this erosion leaves less lateral support for the LMT.

In 2009-10 the ocean took part of Great Highway, and it did so very quickly. This winter could be as bad, or worse.

Despite the risk, which seems serious, better protection for the LMT may not come in time.

Plans call for an inverted L shaped hard barrier is to be installed. The idea is to drill piers west of the LMT, and then cover it with a top, or partial top. The piers form a vertical wall; the top is horizontal.

Experts opine that all is well so long as a thirty year storm does not strike. A thirty year storm is one large enough so that it strikes only on average once in every thirty years.

So when is this inverted L protection to be installed? Until recently, eight to fifteen years out was the plan. That was the time-frame coincident with the Ocean Beach Master Plan of 2012. With the prospect of a severe El Nino, plans have assumed more urgency. But there is zero chance for that hard protection to be in place this winter, or next.

While it is always possible that emergency measures (in the past dumping large rocks) can be accomplished in time to save the LMT, is the risk of LMT failure one the city can afford?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

November 2015

Power and Housing

Since 2002, when the electorate relieved SFPUC (water, sewer, power) from the need to obtain voter approval for its bond funds, SFPUC has been expanding. Need money? Most city agencies must ask voters for it; not SFPUC.

While its $4.7 billion water program is unfinished, and SFPUC is just getting under ground on its $6.9 billion sewer program, next year SFPUC will open a retail power sales business. Called CleanPowerSF, it will sell electricity in competition with the much-despised PG&E. Juice flows in the Spring.

Part of this new endeavor is more ambitious than merely poking PG&E in its bread basket. CleanPowerSF plans to build local and regional renewable power- generating facilities.

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Long after the public officials strut and crow, CleanPowerSF will be building away. One hopes the resulting facilities will economically generate electricity. If not, you’ll be reading about another city “boondoggle.”

At first CleanPowerSF will buy much of the power it will sell, including renewable energy, on the open market. The hope is to gradually generate ever more renewable power itself. In this way residents will be put to work. The electrical workers union, which belatedly is on board, looks forward to build-out work.

What is the plan? Competitor PG&E is under much pressure to supply an ever higher percentage of renewable energy. There is demand aplenty. Why hasn’t that demand been sufficient to motivate the building of the renewable generation facilities CleanPowerSF plans? Are the projects CleanPowerSF plans economical? CleanPowerSF must keep its prices comparable to PG&E’s, or its customers will bail.

CleanPowerSF does start with some advantages. The City has already built solar on rooftops of Moscone Convention Center, and other public buildings around town. That power gives CleanPowerSF a head start.

Going forward, CleanPowerSF plans to site renewable generation at properties owned or controlled by SFPUC. Using property for a second purpose, CleanPowerSF may not need to pay full freight. Such projects will probably be built and operated by a contractor pursuant to a Power Purchase Agreement (PPA) under which all power generated will be sold to CleanPowerSF at a given cost for a set number of years.

Consultants have recommended where CleanPowerSF can build renewable generation. Solar, wind and geothermal facilities are likely to be built. Over fifty megawatts of solar is said to be possible, located in Sunol Valley, SFO (parking lot), Hunters Point, at various reservoirs and water storage facilities around town, and at Piers 90-94. Wind generation could provide up to over 300 megawatts, almost all at regional sites, including Walnut Grove, Montezuma Hills, Sunol, Altamont Pass, Tesla and Oceanside water facilities. Small hydro projects, and a geothermal expansion, may also be pursued.

How this ambitious building program plays out is anyone’s guess. CleanPowerSF is looking to invest “profits” from early sales in its build-out program. Also, bonds will be sold to fund the build-out. While no voter approvals are needed to sell bonds, CleanPowerSF must convince creditors that it is a worthwhile credit risk. This is a new venture. Consultants believe SFPUC has the expertise to go into business, but it lacks a track record and is unproven. As an enterprise department, taxpayers are not to pay; revenues generated are to cover costs. (However, six million dollars of City money has been fronted for startup.)

What would build-out of renewable generation facilities cost? That is the big question. Mid-range estimates are that 56 megawatts of solar might be put up for $173 million, a bit over $3 million capital cost per megawatt. For wind, the estimate is $732 million for 328 megawatts, or about $2.25 million per megawatt. Geothermal is penciled in at considerably more. Solar prices have been declining. Wind is drawing more attention because of bird and bat kills; will its cost rise accordingly?

Although no schedule is yet firm, $200 million of bonds might be sold during the first five years, documents show. Build-out should begin in year two, with some rooftop solar in year one as well. The build-out schedule will be dependent on finances, still a big question mark.

Costs can easily multiply. CleanPowerSF will charge the cost of SFPUC employees who work on the matter. It must obtain environmental clearances, or pay a private contractor to do so. It will be using land for two purposes, instead of just the one now involved (say water transmission). It must connect up to the grid, or bring power to the city directly. There are always changes and claims. For the water program, now four-fifths done, these have increased costs more than twenty percent (and not all are solved).

Supervisors keen to take a poke at PG&E are cheering on CleanPowerSF. Even the mayor has come around to supporting what had been viewed as a dubious endeavor, financially dangerous. Long after the public officials strut and crow, CleanPowerSF will be building away. One hopes the resulting facilities will economically generate electricity. If not, you’ll be reading about another city “boondoggle.”

* * *

Returning to the stoop: SF’s affordable housing policy. While there are a wide range of numbers, among the latest is Lee’s 10,000 affordable units by 2020, 2000 per year.

But not counted, nor seemingly considered, are affordable units taken off the market. Some go Ellis Act; some may go because they have been “affordable” for the agreed number of years, usually twenty-five, which are up. Are we not interested in adding units, net? Why not follow the change in the number of affordable units. The population of SF is increasing on the order of 10,000 per year. What percentage of newcomers require affordable units? At 2000 per year, are we getting ahead or further behind?

Better yet, review housing policy. For years city government led the way towards affordable housing. Is it succeeding? If not, perhaps a course change is indicated? How about zoning rationally, and unleashing the private market? Sure, in the short-term the new housing built will be luxury. But in the longer run the full spectrum of demand should be balanced with supply. We have a housing policy that has not worked, is not working, and yet our leaders clamor for more. What’s the definition of insane?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

October 2015

Revenues Down—Rates Up!

On July 1 the rate for water and sewer service rose again at well above the rate of inflation. Get used to that; rates will rise much faster than inflation for the foreseeable future. Yet your bill probably remained about the same. Addressing drought San Franciscans have conserved lots, more than requested.

So much conservation means that revenues are coming in short. The budget report for the fiscal year that ended June 30 came up short over $41 million for water, $16.6 million for sewer, and $17.3 million for power.

Yet for now there are no course changes in the works. Reserves have been tapped, one-time revenues taken (such as sale of surplus property), and officials are hanging on, betting that nothing major rocks the boat. Alternatives on what to do in the longer term are to be presented soon.

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So much conservation means that revenues are coming in short. The budget report for the fiscal year that ended June 30 came up short over $41 million for water, $16.6 million for sewer, and $17.3 million for power”

One matter that could rock the boat in a major way is collapse of the Mountain Tunnel, an essential part of the very linear system conveying our water from the Sierras. A dozen years ago the Mountain Tunnel was to be fixed as part of the Water System Improvement Program (know then as Capital Improvement Program for water). The 2002 explanation reads, “Mountain Tunnel was built in 1920 with an asset life of 60 years. The lower section of the tunnel is lined, and parts of the lining is breaking off. The project will replace or repair the lining....” But ten years ago when the program was revised and renamed the Mountain Tunnel project was eliminated. The program’s cost had escalated. Officials avoided criticism by paring back the work to be done.

Suburban customers of our water system are very concerned about Mountain Tunnel. They know that if it becomes blocked, it could be months before it is operable. While less water is being used by all customers, the water conveyance system from the Sierras cannot be out of service for months. Suburban customers are pressuring San Francisco to reduce the risk.

Hope that you do not see Mountain Tunnel as a headline in the daily papers.

Understand that while your bill is probably not noticeably higher, you are and will definitely be paying more for water and sewage. The revenue shortfall must be made up.

San Francisco continues its march towards competing with PG&E to provide your electricity. Officials claim that all is on track for CleanPowerSF to debut early next year. An Implementation Plan has been approved. Bids for power have been solicited. The City has settled with the electrical workers union; the union now supports the City plan. (The union had objected to the use of RECs (credits) to meet promised renewable energy levels, instead of building renewable generation in the Bay Area, which work the union naturally prefers.)

In implementing CleanPowerSF skies have cleared; at present it seems to be smooth sailing.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

September 2015

Easy Come – And It’s Gone

Water and sewer rates have been rising at multiples of the CPI in recent years. Rates will continue to rise at similar or greater levels for the foreseeable future to pay for the nearly seven billion dollar program to repair the sewer system.

The latest policy development provides more cause for concern.

Competitive bidding is how public works have traditionally been contracted out (let). The public entity (here SFPUC) prepares detailed plans and specifications, and contractors bid. The low bidder wins the work. The public gets work done at lowest cost. It is fair to bidders.

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Now SFPUC wants to jettison competitive bidding in favor or a new method... allows the winner of a contract to be judged not purely on price but 35% on “other factors.” “Quality factors” boil down to how well the bidder will, or promises to, serve the “under-served communities” with social programs.”

As public contracts have become less about physical work and more about social work—local business promotion, and local hiring, for examples—competitive bidding gets harder. Not only must a bidder figure out how to buy the materials required, and do the work, but also the bidder must do so meeting numerous requirements—percentage of disadvantaged subcontractors, local hires, use of local businesses, etc. Bidding is hard: subcontractor bids come in at the very last minute before deadline.

Now SFPUC wants to jettison competitive bidding in favor or a new method. The method, called CMGC (construction manager – general contractor), allows the winner of a contract to be judged not purely on price but 35% on “other factors.” “Quality factors” boil down to how well the bidder will, or promises to, serve the “under-served communities” with social programs.

For the ratepayer, what is key here is that it is no longer a matter of the lowest price. The cost of publicworks will rise.

The SSIP program already has a nominally $6.9 billion price-tag. That is more than $8200 for every resident.

Competitive bidding is hard but fair. Favored contractors still have to bid low or lose the job. But with the proposed CMGC method, favored contractors’ bids will receive favorable subjective scores.

The CMGC method also limits bidders to three who have prequalified. By limiting the pool of bidders the cost of work will rise. Prequalification further increases price by weeding out the new and hungry.

In order to stay in favor, contractors/bidders will mostly do as SFPUC staff suggests, hiring favored local businesses for example. The higher cost will just be added to the project cost; the contractor earns more markup on the higher cost.

Social work requirements can be and have been part of detailed specifications. They need to be written out in advance. Bidders figure out how to meet the requirements. Favoritism by public officials is minimized.

Have we come into so much wealth that SF can afford to pay up for billions of dollars of sewer repair? Do we wish to open the door wider to favoritism?

* * *

Affordable housing—a modest proposal. Take one-tenth of the $1.1 billion, or $2.7 bn, or whatever is to be spent on affordable housing upcoming, and set up a competition between public and private. For private, give a subsidy to owners who build affordable housing. They earn a check from the city each month they lease an affordable apartment. They have to build the unit, lease the unit to someone occupying it full time, and the rent has to be affordable. That’s all. Incentive to build affordable: Guarantee the subsidy, if the above conditions are met, until 2025. Take the present value of that guarantee (assuming criteria always will be met) off from the 10% amount (total: something like $100-200 million), and continue the offer until funds run out. See how well that works. Compare to government/nonprofit, that is today’s method(s) of building affordable housing, which, IMO, has not succeeded impressively yet.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

July/August 2015

Drought 101 for SF

The state may be sucking dry winds, but San Francisco is in a relatively good place in this drought. We have the Hetch Hetchy water system, and we have conserved early on.

Most of the Hetchy watershed is above eight thousand feet in elevation. This means that we have snow pack. Our water officials call the snow pack “pathetic” this year, but there is some. News flashes braying “no snow” are based on watersheds that are lower in elevation than ours. It is expected that the Hetchy reservoir will be close to 100% full on the fourth of July.

San Franciscans have reduced usage to lows that are envied. Residents are using less than forty-five gallons per person per day. And we accomplished this feat last year.

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Consequently, San Franciscans are not being asked to greatly reduce this year. We need to do a little better. Profligate jurisdictions are being asked to reduce thirty-five percent. ”

Consequently, San Franciscans are not being asked to greatly reduce this year. We need to do a little better. Profligate jurisdictions are being asked to reduce thirty-five percent.

How is San Francisco to accomplish this year’s drought goals? Here’s the plan; it could change:

• Retail customers to reduce use by 10% (last year residential use was down about 8%);
• Reduce irrigation use by a higher amount (25%) with excess use charges for non-compliance;
• Potentially suspend flow factor reductions for sewer rates;
• Target a subset of our biggest users for focused water use reduction. This would include universities and other big users, especially where they have not used our conservation services;
• Implement leak identification and repair programs;
• Public outreach campaign by SFPUC targeted to begin around June 1.

San Francisco’s wonderful water system has about three years supply in storage. It is said that the state has a one year supply stored.

While we don’t want to be complacent, as a much longer drought than usual could befall the state, we San Franciscans should celebrate our diligence and our luck in having an amazing water system.


Ten-year Capital Plan

Attempting to look ahead and plan ahead, the City makes a ten-year plan for capital improvements. What’s in the latest plan?

Over the past nine years SF has spent $13 billion on capital work. Over the next ten it plans to spend $32 billion; in addition, $3.6 of need is recognized but deferred. Of the planned spending, 43% is on transportation, 30% is infrastructure (sewer, water, power, etc.), 13% is on economic and neighborhood development, with less than ten percent each for health and human services, safety, and recreation-culture-education-government.

If there are 835,000 San Franciscans, and ignoring population increase, SF plans to spend about $38,000 per resident over the next ten years on capital projects.

One surprise is affordable housing. Once upon a time housing was provided by the private market (oh, say it: developers). Then the City made that more and more difficult. So today only the City can provide (drum roll here) affordable housing. Almost every election voters are asked to vote favoring affordable housing. This upcoming election it’s a $250 million bond on the November ballot. (Might end up higher, if Supes can jack up the dollar amount.) Two point seven billion dollars of public money is planned to be spent on affordable housing in the upcoming twenty years, and $1.2 billion is to be spent funding housing subsidies over thirty years. (Subsidies, by the way, serve a “middle-income” couple earning up to $140,000 a year.) Plans are to rehabilitate housing, and reorganize, shifting ownership to nonprofits.

But when one tries to find out what the Mayor’s Office of Housing plans to do with the next chunk of change, $250 million, well good luck. The Mayor’s Office’s presentation to the city Capital Planning Commission is incomprehensible, and contains errors of simple arithmetic. Such presentations have become SOP with the city. Those subjected to the presentation are not supposed to understand; they are supposed to be (and are) cowed.

Proponents will say that the General Obligation Bond Oversight Committee will ensure proper spending. Don’t believe it. Such committees are filled with sycophants who spin their wheels a few times a year for show. They are there so that you can be falsely assured.

But, hey, affordable housing is needed, right? And greedy developers want to make a profit, god-forbid, plus they have failed to provide much housing—no little thanks to over-regulation and restriction by the city. So let’s see what City Hall can do. Who knows, our $250 million, along with more than ten times more upcoming, might not be frittered away. And if it is, surely our intentions were good. We believe that the City will be able to spend to solve our housing shortage and affordability crisis, don’t we?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

June 2015

Scoring Our Utilities

First, be assured that Governor Brown’s 25% reduction mandate will have little effect on you. San Francisco residents will only be asked to do a little better than they did last year when they conserved 8% and set new lows for residential water use per person. The Water Department has a plan to save what water SF is asked to save by focusing on larger users. Exception: if you have a reduced wastewater factor, you may be in for special attention; water for landscaping should be reduced.

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Without the marketplace to provide correction, scorecards such as that provided by SFPUC are perhaps some assurance that costs do not grow too unreasonable.”

Think about what a utility is. Society enables a monopoly. One business entity, public or private, is tasked with providing a service such as electricity, water, sewage, garbage, or perhaps internet service. In return it fairly divides up its costs among the customers. The utility is allowed a regulated, reasonable profit. If the utility is public there is no profit.

While perhaps the public utility sounds better, public agencies may be less efficient. They make government larger, and tend to “do more,” such as hire teens in summer, provide community benefits, plant greenways, give away toilets, finance solar installations, run Lake Merced, and clean up gun club pollution.

Public or private, the principle is the same: the public grants the utility the right and duty to provide a service (usually an exclusive right), and the utility agrees to control cost, divide it among users fairly, and accept a reasonable profit (if public, none).

When government fines a utility, as PG&E has been fined ($1.6 billion), what is the utility to do with that cost? Eventually it spreads the cost out to its customers.

When CleanPowerSF opens for business, PG&E’s rates will be the benchmark. If PG&E’s rates are higher, so too will be CleanPowerSF’s rates. (CleanPowerSF’s profit will be plowed into renewable generation infrastructure.)

When a utility is fined, it is much like a tax. The cost of that fine will find its way to customers, taxpayers.

Levying huge fines on large corporations is similar. Recently government has written vague regulations, and even incentivized behavior which it later determines is violation. Corporations pay large fines to government, sometimes tens of billions, and pass that cost on to consumers (stand-ins for taxpayers).

Do you imagine that government does not understand how sweet a method of quasi-taxation this is? “Money for nothing and chicks for free” sang Dire Straits. Tax revenue disguised; publicity ops for free.

When a utility is public rather than private, there may be pressure to ensure that the costs it distributes to users are reasonable.

In San Francisco, rates are set by public appointees at a public hearing. For example, rates for electricity to be sold by CleanPowerSF will be set at the SFPUC’s Commission meeting of May 12th; water and sewer rates were set last year, for multiple years. (An example rate for a single family household using “six units” or about 4488 gallons per month (150 gallons per day) is $93.25 per month for both water and sewer.)

At this time of year customers who receive bills get a Scorecard which scores SFPUC. This is to hold the public utility accountable. (San Francisco Public Utilities Commission provides water and sewer service, electricity now to public places, and soon to some private homes and businesses too.)

Overall, the latest Scorecard score for SFPUC is a B; good, but not excellent. For “cost of service:” C+. For average bill, A (because the average bill for a San Francisco household is less than that for an average Californian, shown as $165 per month for water, sewer and electricity, versus $194 for the average Californian). For customer service, B. For preventative maintenance, B-. For environmental stewardship, surprisingly, B-.

Scores are provided by the Controller, based on various metrics adopted by SFPUC. There is much wrapped up in the letter score. For example, cost of watershouldbe cheap. The Raker Act of 1913 gave San Francisco an amazing gift. Still benefiting from sympathy for the awful earthquake of 1906, and fire that burned down the city for lack of water, Congress allowed SF to take water from Yosemite parkland in the high Sierras, from a watershed pure and natural, and protected in perpetuity, at a nominal cost.

Without the marketplace to provide correction, scorecards such as that provided by SFPUC are perhaps some assurance that costs do not grow too unreasonable. The Commission itself is another check. But commissioners are political people appointed politically; naturally they help city officials distribute millions to this and that interest group for numerous good causes. (Years ago they simply turned money over to the General Fund for city Supervisors to spend as they pleased, but citizens rose up and put a stop to that.)

The one big check that SFPUC lacks concerns bond spending. Most city bond spending gets run through voters, who can turn thumbs down. Voters rarely do, especially for schools, libraries or parks, but they can. SFPUC need not run bond spending by voters. That does increase its spending. For example, back in 2002 the plan was to spend $4.4 billion upgrading water and sewer capital assets. Today those upgrades are to cost $11.7 billion. Where there’s an open checkbook....

But, hey, at least the bill payer receives a scorecard.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

May 2015

Limiting Water and Sewer Rising Rates

SFPUC—water, sewer, power—is a sizable public enterprise that spends close to a billion dollars a year. Within the past decade it moved into fancy headquarters with artworks and cool wind-powered machines. It is mostly finished with its $4.8 billion water system improvement program, and has launched its $6.9 billion sewer system improvement program. In 2002 these, then combined, were priced at $4.4 billion.

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For the past eighty years, what with the gift of the Hetch Hetchy watershed after the great earthquake of 1906, San Franciscans have enjoyed a much lower rate cost than that. Alas, all good things end.”

Who minds the very considerable spending of SFPUC (San Francisco Public Utilities Commission)? It’s your money; in rates for water and sewer, you pay for its spending.

Firstly, there is a commission of five mayoral appointees. Each of these must be confirmed by the Board of Supervisors. A decade ago this commission sat twenty times a year, said very little, and voted as staff (through the SFPUC general manager) asked. More recently commissioners have an “office.” One is the environmental commissioner, another is supposed to have experience representing ratepayers, as examples. Today commissioners are more likely to express themselves, and in small ways, guide affairs of the enterprise. As a group the commission represents the ratepayers; one of the enterprise’s goals is affordability.

Secondly, there is RBOC, the Revenue Bond Oversight Committee. As SFPUC is spending by going deeply into debt, the idea is for this group to oversee spending of debt (bond) money to make sure it is not wasted. The group meets about ten times a year for a couple of hours at a time. It has some money to spend, and hires professionals to evaluate the effectiveness of spending.

The largest project of the water system improvements is called Calaveras Dam. About fifteen years ago the 1925 dam was deemed a risk, as it is on an earthquake fault and old. A new, better dam is being built just downstream. The project started out with a supposed cost of $265 million; now its cost is expected to be $718 million, according to a report commissioned by RBOC. On the project there are nearly one hundred change orders, eleven of which are over one million dollars. One is for nearly one hundred million dollars. The delay to the project’s completion: 2554 days, i.e. years. Costs of clearing environmental hurdles and construction management both more than doubled. Of five projects studied, including Calaveras Dam, a RBOC report says, “the results of the [WSIP] change process have been much less than desired. Per the [available data, changes add] 27.4%, which is very high.”

In addition to added cost due to changes, there are “soft costs” over and above the “hard” cost of contracts for work done by contractors. RBOC concluded that WSIP’s soft costs are too high.

These results are concerning. WSIP is about two-thirds the size of the upcoming SSIP. But half of WSIP is paid by suburban water agencies supplied by our Hetchy water system. Moreover, the sewer improvement work (SSIP) is almost entirely to be done here in the city. City work generally generates more changes; there are many underground obstructions and hindrances. The change process, and controlling the cost of changes, will be more important.

Perhaps SFPUC will learn from WSIP. If not, expect your sewer bill, which while separate from your water bill is tied to it, to rise faster. Water use is down. While that sounds like a good thing, and mostly is, delivering less water cuts SFPUC’s costs hardly at all. With our gravity system power is not saved; indeed, less power may be generated. The same cost is divided fewer ways. That means higher rates. A utility must recover its costs.

SFPUC is committed to keeping rates at no more than 2.5% of median income, considered “affordable.” For the past eighty years, what with the gift of the Hetch Hetchy watershed after the great earthquake of 1906, San Franciscans have enjoyed a much lower rate cost than that. Alas, all good things end.

There may be little that ratepayers can do to slow the rapid rise in yet another cost of living in the special city. Voters rejected an initiative to employ a ratepayer advocate. In 2002 voters gave up their right to vote on issuing bonds (incurring debt). Commissioners heed staff, who cater to their needs and whims. RBOC meets for perhaps twenty-five hours a year; it mainly can engage outside professionals. The outside professionals hope to continue to be hired on city matters, and are constrained to temper their critique.

When a city enterprise becomes so big and powerful, spending so much money, it is essentially unstoppable. It does and spends what it wants, with very little constraint.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

March 2015

What’s up with our water, sewer & power people?

SFPUC, SF Public Utilities Commission, with about 2300 city employees

The Water System Improvement Program (WSIP) is now $4.8 billion, up from $3.4 billion a dozen years ago. The program, which by state law was to be completed this year, is projected to be done in 2019. The largest project, Calaveras Dam, building a new dam downstream to hold the reservoir, continues to be challenging, overrunning in time and cost. Projects severed from the program, recycled water and SF groundwater, have yet to break ground, although the latter is to do so shortly.

Between now and August 2018, the rate you pay for water will rise by nearly half (50%) to help pay for WSIP.

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San Franciscan’s residential use is below 45 gallons per day per person; ten years ago it was 61. By early November we had saved all the water officials asked us to save this past year because of drought.”


Water usage is down. The system expected to deliver 265 mgd (million gallons per day) by 2018. This past year it delivered 220 mgd, on a downward trend. San Franciscan’s residential use is below 45 gallons per day per person; ten years ago it was 61. By early November we had saved all the water officials asked us to save this past year because of drought. In 2014 the system’s wholesale customers (taking about two-thirds of system water) revised downward the amount of water they plan to buy going forward.

Re sewers, the Sewer System Improvement Program (SSIP), a $6.9 billion, twenty-year set of projects, is now underway. The largest early project replaces Biosolids digesters at the Southeast Plant at a cost approaching $2 billion. Engineers have been hired, and early planning—figuring out where, what, and how many, and perhaps how deep and high—has mostly been done. Two years of environmental review starts in July. Construction is scheduled for January 2018 to June 2022. (The Southeast plant treats 80% of SF’s sewage; it is one of three treatment plants.)

There are many smaller SSIP projects. Rates are rising modestly now, but will accelerate as SSIP projects really start spending.

Both sewer and water projects are paid for with bonds. Typically bonds are sold shortly before funds are needed. Usually they are paid off over thirty years; the start of pay-off is often delayed by a year or so. Rates rise to pay off the bonds.

Quick overview of finances. Let’s look at the Wastewater (sewer) division for the next ten years. About $5.3 billion will be spent on the SSIP and capital improvement. Approaching $5 billion comes from the sale of bonds (debt), and nearly half a billion comes from ratepayers (the monthly payments you make). $44 million comes from capacity fees; these are fees developers pay to buy into the sewer system, using up some of its capacity. For Water, where the big capital work is mostly done, the amount to be spent is much less, about $1.3 billion, and the portion coming from rates is larger, about $440 million; most of the remainder comes from bonds (debt).

Power. CleanPowerSF is controversial. It would sell “clean” power, competing with PG&E. The challenge has been to sell what reasonably can be called clean power at rates not too much above what PG&E charges for its electricity, which is about one-quarter renewable. “Clean” is a less desirable category than “renewable;” it includes power generated by large hydro, which does not qualify as renewable. As proposed, clean power also includes RECs, renewable energy credits. RECs are controversial because they pay for remote renewable power; but the power the payer gets is not renewable. As power delivered over the grid is fungible anyway, perhaps local or remote does not matter; but many want actual renewably generated power, not payment equivalent to indulgences.

Until recently the Mayor has opposed launching CleanPowerSF despite a Board of Supervisors that strongly supports the program. For the past six months a vacancy on the Commission has gone unfilled as there was little prospect that the Mayor and BOS could agree on an appointee. Recently, in response to a report about the CleanPowerSF program, the Mayor switched from opposed to qualified support, and he appointed a commissioner to the vacant seat: Ike Kwon, general manager of the Academy of Sciences. Now the Mayor and Board likely differ over how quickly CleanPowerSF will be launched, and what assurances will be given first.

The power enterprise of SFPUC has long delivered electricity to MUNI, City Hall, General Hospital, and other public buildings and places. Electricity is cheaply generated downstream from Hetch Hetchy Reservoir (160 miles east in the Sierras). One of the water tunnels needs work likely to cost half a billion dollars, or possibly more. After inspection Mountain Tunnel’s problems should come into sharper focus.

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The Mayor’s annual speech announces his intention to provide rent subsidies in “emergencies,” and eviction defense, to avoid evictions; to help rent controlled tenants buy their buildings; and to sell bonds (go into debt) to fund more affordable housing. Public policy used to abhor letting officials give away public funds. Favoritism and corruption was thought inevitable. Lead not to temptation. New York City enables tenants to buy buildings. (The author knows from personal experience.) Is it not odd that those who for years have benefited from rent control then get to cash in by “selling” their rights? Going into debt to build housing that costs nearly half a million dollars per unit, and becomes ready only after extended gestation, seems inefficient. Future generations are burdened while today’s politicians strut and crow at ground-breakings. More and more, might makes right in the world of civic affairs. Will public policy rise again (from the dead)?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2015

Another Do-Good Debacle

The City Commission responsible for water, sewer and power (SFPUC) has increased rates effective July 1st. Over the next four years combined water and sewer rates will rise 41% for a typical single-family home.

SFPUC also supplies City departments with electricity. Beginning July 1 General Fund departments of the City will pay more. Still, they will pay much less than they would if powered by PG&E. SFPUC's Hetch Hetchy power system subsidizes the General Fund departments by millions of dollars, and has for decades.

General Fund departments (example: Recreation & Park) got the rate increase in order to solve what was called a "fiscal cliff." The budget for Hetch Hetchy Water & Power was out of balance, and earlier was rejected by Commissioners. Like squeezing into tight jeans, postponing and eliminating expenditures, and increasing revenue by hiking the rate charged to General Fund departments, made for a tight fit.

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With creative accounting, for decades Hetchy has paid for itself and given the City's General Fund departments electricity at rates far below market. But all good things come to an end ... Only so long can maintenance and renewal be deferred.”

But as one Commissioner pointed out at the meeting where the revised budget was approved, all the extra revenue from the rate increase would not pay for one program, the funding for which was increased: GoSolar.

GoSolar is a city program designed to encourage solar panel installation. The program has spent about 20 million dollars (24m appropriated; 4m unspent). In recent years it's been downsized, causing loud protests from Greens. This upcoming fiscal year, and next, it has been fully funded with $5 million per year.

Essentially there was a trade-off. The budget of Hetch Hetchy Water & Power was out of balance, and presented a future "fiscal cliff." To solve that the mayor grabbed $19.5 million from CleanPowerSF, while fully funding GoSolar. A tasty bone was tossed.

Unfortunately, the power side's fiscal cliff has not disappeared forever. It has been moved back.

Moreover, Supervisors are still furious at the mayor for killing CleanPowerSF and grabbing its funds. CleanPowerSF was to have launched a retail municipal power enterprise, poking PG&E in the eye, and making available 100% renewable power—at greater cost to retail consumers.

With creative accounting, for decades Hetchy has paid for itself and given the City's General Fund departments electricity at rates far below market. But all good things come to an end. Having opened in the Thirties, the infrastructure is old. Only so long can maintenance and renewal be deferred. This next fiscal year, for the first time, revenue bonds will be sold. Hetchy is going into debt. (The Mountain Tunnel trouble, perhaps half a billion dollars to fix, put a decisive end to sunny finances.)

Is GoSolar worthwhile? Well, Commissioners did vote to fully fund it, but there were questions—mostly unanswered. As one Commissioner pointed out, the program pays non-customers. SFPUC money, which comes from rates, goes out through GoSolar to customers of PG&E. Does that make sense? You pay more so PG&E sells less?

Beyond the theoretical difficulty, what has GoSolar accomplished? It was reported that there are 8.2 megawatts of installed capacity. San Francisco consumes somewhere in the vicinity of 18,000 megawatts hours of electricity per day average. Solar (in-city) provides a small share, about half a percent.

GoSolar generates jobs, jobs for the disadvantaged. Has it? It was reported to the Commission that 21 jobs were created. Twenty million bucks spent, so far, 21 do the math. But, say proponents, that 21 is only workforce development jobs; there are more that should be recognized. Staff was unwilling to estimate how many more. Solar also reduces emission of greenhouse gases.

This year GoSolar is the beneficiary of politics: it's a convenient way to throw Greens a bone, to compensate for the demise of CleanPowerSF.

GoSolar is but one of what has grown to be quite a number of do-good programs SFPUC sponsors. These programs steer money to causes (and special interests) that are not central to delivering water and sewer service, or municipal power.

At a recent Commission meeting the Coalition for San Francisco Neighborhoods (CSFN) objected to such expenditures by SFPUC. These expenditures are rising rapidly. They inflate rates, threaten long-term financial well-being, and are arguably contrary to law: Prop 218, which requires property-related charges to be proportional to the cost of providing the service.

No comment by Commissioners was made when CSFN presented its objections to including unnecessary expenditures in SFPUC finances. Still, finally the matter has been raised. What happens next?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

June 2014

After the Bells and Whistles — the Bill

CleanPowerSF has been resurrected. With pressure coming on many fronts, the General Manager of SFPUC agreed to assign one employee to continue work on dreams that will not die. LAFCO members, progressive members of the Board of Supervisors, and the SFPUC’s Citizens Advisory Committee all are pushing for getting into the business of supplying greener electricity. In San Francisco public power is a holy grail.

The SFPUC employee is to work up an RFP (request for proposals) for a consultant-magician, who is to conjure up what SFPUC employees have been unable to achieve.

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Staff is mostly keen to do what environmentalists wish: greens are not only most vocal, but also what they advocate means work and jobs. The first job of any public servant is job protection. Will the squeaky wheel get the grease?

Selling “100% renewable” energy for about what PG&E power costs is just not possible unless the City pays or takes plenty of risk. It’s long been a pipe dream. The rabbit hole in which the City finds itself got deeper with the Mountain Tunnel troubles that have developed. Mountain Tunnel has added about half a billion dollars to the power budget. That budget was so out of balance that the Commission refused to accept staff’s proposed budget earlier this year. But some Supes are addicted to their pipes. SFPUC employees must be sick and tired of re-working numbers that won’t add up, no matter what new math is used or how the numbers are smoked.

If a consultant is engaged, the firm will be hired to work magic. What can it do? It must come up with something. Razzle-dazzle distracts undecideds, and wins applause from those determined that the program go forward, no matter the cost or risk. Expect razzle-dazzle.

Germany leads the world in renewable energy. Close to one-quarter of its electricity is generated renewably. For an average household the cost for the subsidies is $355 a year. In Germany the risk of power outage is high. To minimize the risk, Germany is burning more unclean brown coal than it has since 1990. Ironically, itsenergiewendehas increased, not decreased, emission of greenhouse gases. One in six of its factories is generating its own electricity to avoid paying the public rate for electricity. And it’s kowtowing to the Kremlin.

Holy grail? Consultant’s magic tricks? Who needs ‘em.

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If words were water no drought would we have. Recently the press has been awash. How will we survive drought? Life as we know it must change! It’s a crescendoing cascade of awfuls.

Gray water is the answer, say greens. Gray water is once-used washing machine water, or sink or shower water, but not toilet or food contaminated. Fifty percent of residential water could be saved, crow the proponents.

Really? Let’s put this in perspective. Four out of every five gallons of water used in California is used by agriculture. Even in densely populated San Francisco, residences use about sixty percent; business, parks, fire department and others use plenty. San Franciscan residents already use less than 50 gallons a day on average. If half of residential water in use could be saved, the savings would not rise to double digits of what California uses. To accomplish the single-digit savings, your home’s plumbing would need to be changed—very substantially changed. What would that cost? You would need to pay constant attention to which way this valve and that are turned. Shall this water drain to the gray cistern? Shall water be pumped in from the gray cistern? Is cleaning or maintenance needed yet?

Imagine, too, the effect on sewers. Today sewage stink is caused by wastewater that fails to move along. As less water is used it will slow further. The city has budgeted $6.9 billion to modernize sewers. More?

In no small measure modern life is longer, healthier, and far more pleasant because of ready access to clean water. Turn back the clock?

Maybe. The only citizen voice heard consistently by the SFPUC Commission, which oversees San Francisco’s water, sewer and power department, is that of a strident environmentalist. (Recently even the Bayview folk have been scarce.) Staff is mostly keen to do what environmentalists wish: greens are not only most vocal, but also what they advocate means work and jobs. The first job of any public servant is job protection. Will the squeaky wheel get the grease?

With no ratepayer advocate appearing before the Commission, will you be required to re-plumb for gray water?

Water and sewer bills are rising. Over the next four years combined water and sewer bills are to rise 38%, or at an annual rate of 8.4%. That’s about three times the expected rate of inflation. Modest use is assumed. If you use more than average, then you buy more at the higher (tier) rate.

Bills are rising to pay for improving the water and sewer systems, but also to pay for ever more bells and whistles, proliferating programs designed to do good or please some constituency.Programs include give-aways to encourage conservation, GoSolar, neighborhood improvements steering stormwater away from sewers, habitat projects, summer hires of poor young adults, and much more. Rates increases do not include your cost to re-plumb, to unclog, or to re-landscape.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

May 2014

The Half-Billion Dollar Hole

Annually, SFPUC, the city department that supplies water, sewer and power service, is required to adopt a ten year financial plan. The idea is to look and plan ahead. It's part of "best practices" governing, and is required by the City Charter.

Most years the updated financial plan is dull. This year, one part of the proposed plan amounts to a "fiscal cliff," in the words of SFPUC staff.

While Water and Sewer are in balance, the Power part is not. Within the last year the cost to fix a portion of the Mountain Tunnel has escalated, digging a half billion dollar hole.

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Expect to read more about raising the price of water. It fits nicely with the predilections of bureaucrats. Recycled water is one great way to raise price while doing little good. Let's hope that San Franciscans, who already use remarkably little, are not stampeded into foolishness which fries their finances.”

The Mountain Tunnel is one of the tunnels that bring water from the Sierras 167 miles to San Francisco. It was dug in 1920. The water that it and other tunnels and lines carry is for municipal purposes (drinking, fire protection, irrigation), and also for generating electrical power—which, since the Thirties, has been used by MUNI, street lights and City buildings. (Within the past decade the water-generated power has been proposed to be sold to households through CleanPowerSF, a new endeavor that has not achieved lift-off, and sits on the launching pad, unready.)

The proposed financial plan for Hetch Hetchy Water & Power was called by one commissioner "a disaster" and "not a plan." Staff said the Mountain Tunnel calls for a "momentous" decision. The Commission did not adopt staff's proposed plan for power, calling it a "projection" instead. The Commission asked to be updated quarterly.

Capital cost that affects both water and power is allocated to both. It's really one system providing water and power, but the bureaucrats find it convenient to divide up costs.

In about 2005 Mountain Tunnel work was excised from the capital program today known as WSIP (Water System Improvement Program). Former General Manager Susan Leal had the Mountain Tunnel work, and much more, removed in order to keep costs down, and to finish the program "early," this year—2014. That plan collapsed. Now the program is to be completed in 2019, four years late rather than one year early. (A smaller Calaveras Dam will be done about ten years later than planned in 2003, and at much greater expense.)

While rates for power are not directly billed to consumers (only to City departments and enterprises which now use the Hetchy power), water and sewer rates that you pay are rising fast. "Monstrous" rises are coming, says one commissioner.

What are the latest rate projections? In ten years the rate for water will double. For sewer service the rate will rise 2.7 times. Water increases first, by 12% this coming July 1, and then by 12% and 10% the next two Julys. Then water's rate of increase drops to 7%. But as it does big increases in the sewer rate kick in, starting with 11%, rising to 12%. These are the latest projections. Let's hope there are no further surprises such as the Mountain Tunnel.

A recent Op-ed in a daily paper argued that water rates are too low. They are rising at three times inflation, at least, have been for a decade, and will continue to. The writer failed to acknowledge that agriculture takes four-fifths of the water used in California. Do we really want to drive that industry from the state, and raise food prices, which would punish the poor? The writer proudly uses a market mechanism to use less water, but then switches to proposing to raise price only for higher tier use. Multi-person households jump to the higher tier quickly; might it be that those living with many to a household tend to be poorer, and tend to be home, not out of town, more of the time?

Expect to read more about raising the price of water. It fits nicely with the predilections of bureaucrats. Recycled water is one great way to raise price while doing little good. Let's hope that San Franciscans, who already use remarkably little, are not stampeded into foolishness which fries their finances.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

March 2014

Water Worries

Ocean Beach is on the edge. Just as San Francisco is notoriously edgy, so is this wild world of water and sand. Removed from city, from people and buildings, from insanity and stress of complicated life. Opening on the vastness of the Pacific, Ocean Beach is wild and free. A place to clear your head, to renew; walk your dog or talk with friends.

Unnoticed by most of us, Ocean Beach is changing. Slowly sea levels are rising. Suddenly, at the time of winter King Tide, especially if a storm strikes then, the ocean can attack beach, sand, cliffs, road and man's "improvements." This last happened in 2009-10. Next? Who knows.

In the past we have responded to the ocean's sudden strike with emergency measures, usually dumping rock. It's ugly and unwanted after the crisis passes.

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"Managed retreat" is the guiding philosophy. The southern section of Great Highway is to be re-routed inland around the Zoo; for a stretch…”

To address the imperative of change in a better way, a master plan was released in early 2012.

Now the master plan is being implemented. SPUR's Ben Grant is the "czar."

Eventually an agreement will be reached whereby the main players agree on roles.

So far the Corps of Engineers has provided sand to the north end of the beach, and some has been moved to where it is needed at the south end.

While the master plan contains much about what should be done at the beach—access, amenities, trail, bikes, plantings and much more—details are being worked out. "Managed retreat" is the guiding philosophy. The southern section of Great Highway is to be re-routed inland around the Zoo; for a stretch, Great Highway will be reduced from four to two lanes.

But unlike the ocean's sudden attacks, man-made changes at Ocean Beach will happen slowly over years. The master plan's horizon is 2050. While key sewage infrastructure will be protected, managed retreat and soft accommodation will mostly rule. Pilot projects will tentatively try out ideas.

There is no place like Ocean Beach for open space, awe (at the mighty Pacific), and for renewing the spirit.

Water Supply

One might imagine that water supply and demand are matters long addressed and known. Rain and snow falls (usually), rivers run, water is captured and stored, people use what they use year in, year out. Population grows some, low-flow fixtures are installed; numbers are adjusted a bit.

Not that easy! No, complications are an important part of bureaucratic work. No one else must understand. Creative ambiguity is baked into every report.

So it is with water supply and demand.

Overall, so far as your interpreter can tell, the numbers look good. Less water is being used--much less than was predicted a decade ago. Even suburbanites to the south and east, who use two-thirds of the Hetchy system's water, are using less.

As for the future, while demand is expected to rise some in the next few years, it is then expected to stay about steady for twenty years.

Over the next five years demand in the suburbs is to rise 16%, while city demand is expected to rise about 8%. Naturally, this assumes regimens of strict conservation.

The city must finish work to which it is committed. Recycled water (very expensive) and other "alternative water sources" need to be developed, or all projections evaporate. Groundwater is to supply "up to four million gallons per day." Up to? (Would you be happy if your salary was "up to $5000" per month?)

Construction of alternative water sources will take the next eight or nine years. Groundwater wells and lines within the city are to be built 2014-17. Two recycled water projects follow: Westside Recycled 2017-19; and Eastside Recycled 2019-22. The cost of these will be interesting to follow; already putting substantial upward pressure on rates, overruns on these projects could add pressure to raise rates. Past estimates have proven too low. A dozen years ago recycled water projects were to supply nearly three times what is now projected, at less cost.

Delays in water projects have hurt. Calaveras Dam has been delayed by ten years so far. Filling a reservoir on the Peninsula is being delayed by a thistle.

A recent meeting of the San Francisco Public Utilities Commission discussed what effect Governor Brown's declaration of drought has on San Francisco. None, was the initial answer, then qualified: Customers who buy water from our system will likely receive less from the State, and will then ask the Hetchy system for more. As wholesale customers have been receiving less than they are entitled to take, it is foreseeable that demand may rise. The discussion did not quantify. The Hetchy system has about a million acre feet stored. This is much more than sufficient to provide for the next year, but not all stored water is immediately available, and it is important that it be replenished as insurance against a long drought. Drought has been declared, a 10% cut-back in water use is requested.

This Spring rates for the next two years will be set. Costs are not decreased by drought. To the extent less water is sold, rates need to be higher. If customers reduce use, more is sold at the lower rate tier. Rates are likely to rise by 12-12-10% beginning July 1 of the next three years.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2014

SSIP and a Share of the Pie

As one who writes about SFPUC—water, sewer and (public) power—I've tried to get my mind around the program called SSIP: Sewer System Improvement Program. This is now a $6.9 billion, twenty-year endeavor. The first ten years is Phase One, during which time about $2.7 billion, 40%, is to be spent.

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But back then SFPUC needed voters to approve bond funded work. Today no voter approval is needed. So no set of projects, with cost and schedule, need be presented today. SFPUC does as it wishes; the sheep are corralled.

It is not easy to understand the SSIP. In all about $10,000 per person is to be spent, $500 per year.

One thing is clear: much has changed in a dozen years. Back then the program to update the water system was being launched. (Now it is more than three-quarters done.) There was a definite set of projects, with a cost and schedule for each.

But back then SFPUC needed voters to approve bond funded work. Today no voter approval is needed. So no set of projects, with cost and schedule, need be presented today. SFPUC does as it wishes; the sheep are corralled.

The goals of the water program were to supply more water, and to keep it flowing after a sizable earthquake. After the program was funded, the goal of supplying more water was abandoned. Instead, demand (water use) is being ratcheted down.

The goals of the sewer program are harder to discern. Despite a budget nearly seven times what it was in 2002, today's goals seem amorphous: renew the city's sewage treatment system, especially on the east side of town. There is no set of projects (they will evolve), no expert's report about what is needed, no blessing by gray hairs confirming that the program is a good one and the right one. All of these were there for the water program. But none of that is needed now that voters are corralled.

Speaking of spending freely without constraint, SFPUC spends rate payer money on Lake Merced. The theory is that the lake is an emergency water source. But if an earthquake and tsunamis occur, the ocean may flood into the lake. Here's an emergency water source that could fail in an earthquake.

Perhaps "emergency water source" is merely a justification of convenience, a way to get the money from rate payers rather than from the city's over-subscribed General Fund. Raising rates is easy.


Looking now at our national economy, until the early 1980s labor and capital divided the "pie," the value created, often called GDP, in the same proportions: about two-thirds to labor, and about one-third to capital. The pie grew, expanding even faster than population, so that standard of living rose.

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While there is no consensus about why, it seems likely that machines are replacing people as workers. Fewer workers are required. Leveraged by better machines—especially computers—workers produce more.

In the early '80s, labor's share of pie began to decline. While the pie continued to enlarge for another generation, labor's per-person take remained about constant; labor's proportionate share declined.

Then in the 2000s expansion of the pie began to slow. After the financial crisis of 2008, expansion of the pie approached stoppage. Now labor's share is closer to three-fifths.

Even worse, the share of labor's bottom 99% has dropped from about 60% to not much over 50%.

This same phenomenon happened all over the world. It is pronounced in Norway and Sweden, countries known for equality.

Why has this happened, and what can be done about it?

While there is no consensus about why, it seems likely that machines are replacing people as workers. Fewer workers are required. Leveraged by better machines—especially computers—workers produce more. Give machines a smart, hard-working few, and enough will be produced.

Where does this leave the former workers?

Demanding a remedy is where. Upon losing their jobs, unemployment, or disability, maybe food stamps, maybe a buy-out, is their lot. Former workers look to government for help.

And government is here to help. Pols who wish to be re-elected spread the wealth.

Pols whine "ain't it awful," and they point accusing fingers at the (greedy) wealthy, banks and Wall Street firms, all while raking in "contributions" from those same wealthy donors, wink, wink. Pols pontificate about the importance of education and training, and make token efforts.

But the harsh truth is education and training, while essential for supplying the ever fewer workers that are required, are not efficiently spent on the surplus masses. It is far more efficient to send bread and circuses. Today, make that take-out and Hollywood.

There are plenty of smart, hard-working young, often from far-away places.

Politicians don't know what to do. They do know that they play a role in keeping the great Machine churning, and that the grit of too much unrest would surely slow it. None of that. Hard enough it is to keep the masses fed and entertained, and themselves in office, while both lambasting the rich, and exacting contributions from them.

When a majority of the populace is no longer engaged in producing the wealth, then what? How does society, so long used to spreading work around, adapt?

This space customarily addresses local issues—diving not into the deep end. San Francisco is lucky to attract young, smart, workers—mostly from elsewhere. From the blossoming of efficient Machines we benefit. No Detroit, no Stockton here. Keep that golden goose happy.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

December 2013


Water supply will be insufficient in the future unless there are additions. Recently SFPUC staff presented the possibility of adding recycled water to the city’s drinking water, directly or indirectly.

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...assurances were given that no more than ten percent of any water served to city customers would be (lower quality) groundwater... Now we’re talking about drinking recycled water.”

How far and fast we have fallen! A decade ago there was a plan to increase the water supply, and assurances were given that no more than ten percent of any water served to city customers would be (lower quality) groundwater. The excellent taste of Hetch Hetchy water (so good it was bottled and sold) would be forever preserved! Later, plans to increase supply were scrapped. Then supply was eroded by commitments to streams and habitat. Assurances that groundwater would make up less than ten percent ceased. Now we’re talking about drinking recycled water. All within ten years.

Has this grand waterfall of expectations reduced cost for the ratepayer? Dream on. The cost is up, and as mentioned last column, the next three rate rises on tap are 12-12-10%. Let’s hope your raises do so well. (SFPUC is in the final third of its water improvement program, which aims to upgrade the system, and keep water flowing after a major earthquake. The $4.6 billion endeavor started eleven years ago and is to finish up in 2018.)

Sewer. A $6.9 billion Sewer System Improvement Program (SSIP) has been launched by the San Francisco Public Utilities Commission (SFPUC, the department of city government responsible for water, sewer and public power). The twenty year program is to renew the city’s sewers and sewage treatment system. So far about $30 million has been spent. During the first ten years, phase one, $2.7 billion is to be spent, on average $270 million each year. The largest single work will be building new digesters for the main sewage treatment plant, the Southeast Plant on Third Street at a cost of about a billion and a half. But “green infrastructure” projects lead off; these are supposed to reduce the volume entering the plant.

As SFPUC needs no authorization from voters to spend whatever it wishes on the SSIP and other programs, projects even include about $15 million for early forecasts of rainfall. NOAA (National Oceanic and Atmospheric Association) is to build special stations funded by your rates.

Power. Electricity (as well as natural gas) is mostly provided by PG&E, though now SFPUC supplies public facilities such as MUNI and City Hall. It has been proposed that SFPUC expand, supplying some private homes and businesses with “100% renewable power,” displacing (the hated) PG&E and establishing a beachhead in the battle (of some progressives) to kick PG&E out of San Francisco.A few years back the war cry and promise was to provide renewable power at or below PG&E’s price, “meet or beat.” A couple of years ago, as the plan matured, “meet or beat” became at a “comparable” price. But that hope, too, slipped away. It became apparent that the city could not supply renewable power as cheaply as PG&E supplies power that is only fractionally renewable. Welcome to reality.

At a meeting in August, only two of the five Commissioners voted to establish a maximum rate at which electricity would be offered to customers of the new power provider the city is establishing, called CleanPowerSF. Three Commissioners declined to set a rate, which means the effort is frozen. Members of the Board of Supervisors, which eleven months earlier had authorized the Commission to set a rate, went ballistic. An aggressive letter demanding answers was sent. In September SFPUC staff logged its responses to the letter.

Usually employees of SFPUC, and its Commission, are all too eager to undertake to better the world in ways presently in fashion. Since 2003 SFPUC has an open checkbook; it alone needs not get permission from voters before spending as it wishes. It increases rates for water and sewer, and potentially for electricity, to pay for whatever it wishes to do. It is almost always fun to spend other people’s money. SFPUC’s commissioners are not even elected by voters. Why not spend, you might ask? Increasingly SFPUC has come to do more in the way of “community benefits,” street beautification, parks and greenways, and has taken responsibility for expenses like the water system for fire protection and Lake Merced. Why use city general funds when SFPUC can raise rates to pay? One can only imagine what would cause commissioners to put the brakes on something the BOS authorized. One can hardly imagine how surprised and shocked the BOS was when its will was thwarted! No small jolt was that one!

The ending of this story has yet to unfold. The Mayor prefers not to embark upon another potentially costly public crusade. The BOS, though, at least some of them, are quite determined.

Tangentially, it is interesting to note that not only has the value of utility companies in Germany halved over the past five years, but also earlier this year the price for traditional power went negative. Negative means a generator was paid to provide power. Why? Too much power for the grid to handle; the grid becomes unstable if overloaded. German utilities must buy renewable power, but utilities also need to maintain traditional sources for when the sun fails to shine and the wind fails to blow. It turns out to be hard to shut off some traditional sources. Thus incentives (pay not to provide). Increasingly one source of reliable power is American coal. To Germany, the world leader in encouraging renewables, we export American carbon so Germany may stabilize its troublesome grid. Where are we headed? It’s enough to spin one’s head.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

November 2013

Water Supply

Hetch Hetchy reservoir (Tuolumne River) supplies nearly seven-eighths of San Francisco's water. It also supplies the Peninsula, and parts of Alameda and Santa Clara counties with most of their water.

When the water system opened back in the early Thirties, the city served water to lands along its then new transmission line. These places were sparsely populated. But since then, they have grown to consume twice as much water as does San Francisco. San Francisco is morally and contractually obligated to keep supplying these areas that have long relied on the water supply. Such are the burdens of being big and powerful. Decades later, still powerful, but less so, obligations still bind.

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recently a grant program was expanded. It encourages developers to save water. A grant might be $500,000, saving 3 million gallons per year. That sounds like a lot of water, but is it? The cost per unit of saved water (a unit is about 748 gallons, 100 cubic feet of water) comes to $125 per unit; that unit could be saved repeatedly for years.”

When enviros demand the draining of Hetch Hetchy reservoir to eventually restore it to parkland, voters of San Francisco would affect more than themselves and their city.

Water supply for the future is short. A presentation given to the San Francisco Public Utilities Commission showed that in twenty years the shortage could be over 26 million gallons a day. That is just over 10% of what is delivered today.

Demand for water is expected to decrease before it increases. This creates an illusion. Plenty of water, right? No.

Because of this odd situation, projects are being postponed. Perhaps that is not what authorities admit, but they are. Calaveras Dam is the largest such project; it was to be done in 2009, now it is 2018. A groundwater storage project has been postponed, and there is even some doubt about whether it will be done. Recycled water has been delayed over and over; the amounts to be delivered have greatly decreased while cost has risen.

In a way, inertia and inaction works: An earthquake can strike at any time. Why build what may be destroyed?

But to increase water supply gets harder as time passes. Ten years ago San Francisco could have easily taken 10% more. Today?

While in the near-term there is sufficient water in normal and wet years, in drought there will be shortages. Once rationing exceeds 10-15%, economic impacts become quite severe.

San Francisco has made commitments for the health of creeks from which it takes water. Minimum flows down the Tuolumne River and through the Delta are also important. San Francisco has an enviable supply. But water is in demand—for human uses, and for fish and the environment.

In upcoming years Yosemite looks likely to receive about the same precipitation that it has over the past eighty years. But that is uncertain. San Francisco's main watershed is high in elevation. Snow levels will rise. That will adversely affect runoff, making water harder to capture when it is needed.

For only so long can State authorities keep demanding both cramming more people into San Francisco, and using less water.

Already customers of San Francisco (those to the south and east receiving Hetchy water) are unhappy: San Francisco is too slow and uncertain. The potential for insurrection cannot be ignored. San Francisco could find itself at the precarious end of a long pipeline, losing jobs, water, and control.

Pressure builds. Over the next two decades the region's population is to grow 22%. In San Francisco the rate is just over half that. Water demand is to rise about 20%, but only 3% in San Francisco. Already we in the City are the lowest users, yet we are expected to reduce use more than others.

Most of SF's reduction in water use per person is to come from conservation. For example, recently a grant program was expanded. It encourages developers to save water. A grant might be $500,000, saving 3 million gallons per year. That sounds like a lot of water, but is it? The cost per unit of saved water (a unit is about 748 gallons, 100 cubic fet of water) comes to $125 per unit; that unit could be saved repeatedly for years. The cost of even expensive recycled water is on the order of $15 per unit; recycled water is multiples more expensive than importing Hetchy water. So, yes, we can save water, but at considerable cost.

Rates charged are rising fast, and will continue to rise. For the upcoming three years, expected increases are 12, 12 and 10%. In the past five years rates have risen about 60%. Decisions today reverberate for years and decades. When your water bill becomes unacceptably high, it will be too late to do much.


While all around the city new development blooms, it is good that some of what we treasure is not replaced, but is updated and preserved. The City needs a balance of both new, and treasured old.

A small example of preserving and renewing is the renovation of the Forest Hills Clubhouse. This architectural gem, pushing its century mark, needed updating, but without ruining its character. The Forest Hills Association hired a master planner, and with careful thought has done a half million dollar renovation. There are new ADA compliant rest rooms, seismic improvement, new roof and furnace, better kitchen facilities and more. From the outside you may notice almost nothing. That's desired. Meetings of community groups, musical performances and more have been held at the Clubhouse. The hope is that for years to come the clubhouse will welcome and delight Westside residents, reprising a day when time itself ran slower and more stately. (381 Magellan Avenue; Plath & Co. contractor.)

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

October 2013

Can our City Spend? Yes We Can!

Municipal spending is up to $7.9 billion this fiscal year, nearly $10,000 per city resident. And City government is adding employees to its already bloated payroll. Yet, pension and healthcare costs remain long-term threats, the 2011 "reform" notwithstanding. What gives?

It seems nearly impossible to adequately address the monster issues of pension and healthcare. City government continues to assume that its pension fund will multiply as bunnies do. Like bunnies, our leaders nibble, and crawl into a dark hole.

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What renewable generation will be erected? Windmills off Ocean Beach? ... No plan has been put forward, other than to hire consultants to conjure up a plan?"

The problem seems to be that the public figure who tackles the elephant in the room gets smushed. If you are a retired city employee, or one soon to retire, or one who hopes one day to retire, or the relative of one, pension and healthcare is the be-all and end-all of your civic concerns. Like rent control for covered renters, no other issue comes close. Quickly you become a fanatic, a one-issue voter, obsessed with the big pocketbook issue. The public official who tries to do the right and rational thing gets creamed. The public official who weaves and dodges, or nibbles, survives. Promoting the general welfare is fine in theory, but if you want to get elected in this town, you deal with real interest groups, not real issues.

Similarly, the elected official who showers benefits on groups A-ZZZ gets votes and supporters. The elected official who withholds spending gets none. Guess who gets elected? Guess which practice prevails?

Today, even the so-called enterprise departments are in on the big spending game. Ten years ago SFPUC (water, power, and sewer) had no community benefits group. Today it certainly does, headed by an assistant general manager who makes nearly 200k. That's just salary. She makes more on the outside. She steers millions of dollars to "under-served" communities. In doing so it is recently said that she steered a no-bid contract to a company in which she was financially interested, receiving annual compensation from it of more than $10,000. That's a no-no.

But it's tough when your job is to give out money to the "under-served" to remember that there are limits. You feel fortified with virtue. Beneficiaries love you. It's so easy when you spend others' money. Ratepayers' money.

With more and more spending by more and more city employees with ever bigger salaries and grandiose titles and perquisites, more wanton waste is bound to surface. Rules are bound to be skirted. Elected officials and their appointees know that goodies are best steered to those who know how to return a favor.

Consider GoSolar. As of early this year, $17.1 million had been bestowed on 2158 applicants through this program, which improves private property with public funds. That amounts to nearly $8000 per applicant. The typical solar installation costs $15-20,000. Recently, with the program cut back due to tighter times, 61 (of 199) applicants got $416,000, $6820 apiece average. Ratepayer money goes to a hungry group of purveyors and installers, creating not only a way to bestow benefits but also an interest group to lobby annually for more solar funding. A bureaucracy oversees it all.

But GoSolar is only a pilot fish. Once finally launched, CleanPowerSF promises a "robust local buildout" of facilities generating renewable electricity, all for 11.5 cents per kilowatt hour. If there is a plan for how to generate electricity cheaply enough to supply it at that rate, it is well concealed.

CleanPowerSF looks like a boondoggle: a well-intentioned, ill thought-out program, costs ballooning. It talks "100% renewable power" but much of the power is not renewable. It uses accounting trickery, so-called RECs, renewable energy credits. It does this to develop bonding capacity, i.e. more City bonds and debt.

CleanPowerSF is claiming to be the sword that slews global warming. Really? Electricity accounts for 24% of San Francisco's greenhouse gas emissions, according to an SFPUC document. CleanPower slews a lesser dragon. How powerful is its swift sword? CleanPowerSF promises to increase generation from renewables. But that promise is already disappointing with its proposed use of RECs (indulgence-like "credits"), and inclusion of big-hydro power (not renewable, and not reliable, varying from year to year). A qualifying "renewable" is biomass, which does not even reduce greenhouse gas emissions, and may increase them. What renewable generation will be erected? Windmills off Ocean Beach? Solar PC has already occupied the prime sites, yet these don't generate electricity for anything close to as low as 11.5 cents per kilowatt hour, the rate proposed to be charged. "Robust local buildout" is the talk; but what is the walk? No plan has been put forward, other than to hire consultants to conjure up a plan. Isn't CleanPowerSF really about elected officials show-casing good intentions? No wonder the SFPUC Commission balks; it's a green pipe dream.

In a free spending city it is good that there may be some sensible limits.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

September 2013

Another Bite of the Ratepayer Apple

Your water and sewer rates fund more than you think. It is the new policy of the SFPUC (water-sewer-municipal power) to include in agreements with consulting engineers a provision where the consultant agrees to spend a sum of money for "community benefits."

For example, at its late May meeting the Commission authorized an $80 million contract to engineer new sewage digesters for one of the City's treatment plants. (That's $80 million for the engineering, not for building the digesters.) As part of the contract, the engineering firm agreed to spend $1 million on "community benefits."

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What are "community benefits"? Money spent to win acquiescence, cooperation, or forbearance. Some might say "tribute."

What are "community benefits"? Money spent to win acquiescence, cooperation, or forbearance. Some might say "tribute." For example, when the Southeast Wastewater Treatment Plant was built, the community was given the Southeast Community Center, which has been maintained and funded by your sewer charges ever since.

It's one thing for SFPUC to spend directly on community benefits. And SFPUC does. It has an assistant general manager in charge of community benefits, and she and those under her do spend. At least one knows what is spent, and what for.

But requiring a consulting engineer to spend invites favoritism and corruption. The engineering firm does not care how its million is spent. All it wants to do is please its client, SFPUC. "Tell me how you would like me to spend and I shall." How easy it is, then, to spend for a friend. It's an off-budget expenditure; were you to research how much is spent by SFPUC on community benefits, that would not be included.

It's also an extra bite of the ratepayer apple.

From the tone of voice and attitude of the SFPUC General Manager it was obvious that he is proud of the new policy—this back-door way to spend more on community benefits. This is today's innovative government.

Similarly, in a meeting in early June, the SFPUC Commission authorized the GM to give money grants to homeowners who might benefit from installing protection against flooding. Other homeowners spent their own money to protect their homes. You might well ask why some homeowners get grants while others make do for themselves. Authorizing the GM to give out $150,000 in grants enables favoritism.

Long gone are the days when courts declared such expenditures "gifts of public funds," a specie of corruption.

All we have today are lame "oversight committees" comprised of political appointees who can be counted on to provide a veneer or appearance of oversight without any real substance. So much money flows that a million dollars here and there is hardly noticed, is often not discussed by the Commission. The matter of the million dollars for community benefits would likely not have been discussed except that a community activist, proving his chops, demanded more money.

The City-

1. spends general funds throughout the city, benefiting a community;

2. SFPUC has an assistant general manager and a team focused on community benefits, spending ratepayer dollars directly on select communities; and now, under a new policy,

3. each SFPUC consultant will spend a portion of its contract monies for community benefits. Strike three: ratepayer is out.

Time was, City government maintained roads, public transit, parks, street lights, water, sewer, justice, and facilitated commerce upon which city life relies.

Then City government expanded. And kept expanding. Now, what doesn't it hope to do?

It hopes to equalize "social benefits" throughout our City, partly through "community benefits."

A recent Policy Analysis Report (to Supervisor Avalos) spells out "the distribution of social benefits." This is foundation for the next phase, which will address how City resources address (you can be sure this means "remedy") the existing distribution of social benefits. Impliedly if not expressly, the City will succeed only if it remedies all disparities and creates equality. An impossible goal; but, impliedly, one worth striving for, according to the policy analysis.

"Social benefits" include income, parks, education, safety (freedom from crime), health and environment.

The policy report confirms what most residents already know: Pacific Heights is rich, the Tenderloin is poorer and less safe, etc.

Is the proper role of the City to try to equalize the distribution of social benefits? Isn't the point of working to contribute to society, and thereby earn social benefits, many of which can be bought with the money earned by working? By redistributing, making equal, does the City not undermine that? While it is in the interests of all to provide a safety net, should equal social benefits for all be the goal?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

July-August 2013

Irritations, Various But Never Sundry

Development Central. To guide downtown development, the Central Corridor Plan has emerged. Downtown is already growing. Construction cranes seem everywhere. Zoning changes are to enable even more. Height limits will be raised, office buildings encouraged, and downtown density allowed to increase. The idea is to promote job growth, and provide more residences near transit. The Central Subway is the centerpiece of the Central Corridor Plan.

By 2040 San Francisco is to increase its housing units by one-quarter, and jobs by one-third. In the past similar goals have not been met. But looking at all the development that is already under way, will it be different this time?

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Four well-connected consulting firms each take home $5 million dollar prizes. Who knew that City watersheds required such extensive “management?” And by not one, but by four consultants. Our two thousand-employee SFPUC, staffed with City hires, apparently does not have the time or expertise.”

Is it all over the hill for those of us living on the Westside? Maybe; now most development is on the east side of town, and downtown. But in-fill housing is occurring all over. To fill all those new jobs more people may come to live in existing housing, too. Traffic will increase. Will re-zoning eventually come to transit hubs around Forest Hill Station and West Portal? Will high rise housing spread down Brotherhood Way, across from where churches are now, or displacing their parking lots?

To address new development on the Westside, GWPNA (Greater West Portal Neighborhood Association) has reconstituted a Planning and Land Use Committee to review and weigh in on new, proposed developments.

As last month’s Observer advised, fatal traffic accidents are already more likely on the Westside than anywhere else in the City. GWPNA has formed a traffic and safety committee which is working toward improvements. Four priority intersections have been picked. All touch or are within one block of West Portal.

Recreation scores! Overcoming intense defense, recreation scored a golden goal at the west end of Golden Gate Park, where the sun is setting on grass gopher fields. It is hard to balance park virtues of open space, tranquility, and nature with the values of recreation. Both should win. Absent a lawsuit and another turn of the wheel of political fortune, recreation has won this contest.

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Water System Improvement Program (WSIP): Costs are up $55 million; the budget has been re-set to $4.64 billion. Completion of the revised program has been delayed until Spring 2019. The big cost bust came from Calaveras Dam, which is spilling over by $200 million. Savings on other projects, and on the amount of financing (the interest payable on bonds), because of today’s extraordinarily low interest rates, helped minimize the cost increase.

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Dig this gig: At a recent meeting of our City Public Utilities Commission $20 million was authorized for “watershed monitoring and management technical services.” Four well-connected consulting firms each take home $5 million dollar prizes. Who knew that City watersheds required such extensive “management?” And by not one, but by four consultants. Our two thousand-employee SFPUC, staffed with City hires, apparently does not have the time or expertise.

While this spending authorization is a drop in the proverbial bucket, it illustrates rampant, out-of-control spending. Rates must rise to pay for all expenditures. But if you’re a City manager, four consultants, lotta lunches, and less work for your “hard-working, dedicated public servants.” “Win-win,” as the bureaucrats love to say.

Work begins this month. While the consulting firms may be large and well-connected, the contracts require “community benefits,” and at least 13% local business participation.

What do such lucky consultants actually do? We little people will never understand. “Specialized hydrological services.” What is hydrology? It is “the science dealing with the waters of the earth, their distribution on the surface and underground, and the cycle involving evaporation, precipitation, flow to the seas, etc.” Forked sticks anyone?

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Bolts from the blue. Now we’ve got two bridges from Treasure Island to the contra costa, both seismically suspect. How long has it taken? Two dozen years. How many billions? $6.4 billion. Original estimate: less than one billion. Thirty-two fasteners have snapped; 2000 more are suspect. Caltrans’ rep? Shaky, at best.

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Building blocks of government dysfunction. Sometimes small examples project large. At a meeting of the Greater West Portal Neighborhood Association, Phil Ting’s representative weighed in on a neighborhood concern: pedestrian safety. Ting is in Sacramento, a member of the Assembly. No doubt he wishes to show what he can do to address this concern. His proposed state law funds speed signs at places where seniors walk, signs to slow traffic. Think about it. Does San Francisco really lack money for signs? Does San Francisco need state regs to tell it where to put signs, how large they should be, what color and shape, or how to determine appropriate speed? Of course not. This proposed law serves the politician; it gives him something about which to crow, proving he is responsive and “cares.” It’s all fine with the bureaucrats: one set, in Sacramento, gets to draw up regulations, and dole out money, after applications are scrutinized, i’s dotted and t’s crossed. Another set of public employees, in San Francisco, gets to hire consultants, massage data, and apply for and secure Sacramento funding. Add another brick to the wall of dysfunction.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

June 2013


Riotous Rates

Rates for water are expected to double by 2021—in eight years. Water rates have been zooming higher at much more than the rate of inflation. Increases pay for the $4.6 billion Water System Improvement Program (WSIP). That program is scheduled to be completed in 2016, but now SFPUC has acknowledged that it will be more than two years late. The budget for the program is busted as well: for now by $17.6 million. But this figure fails to tell the whole story. The entire program contingency fund is used up years before construction ends.

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The budget for the program is busted as well: for now by $17.6 million. But this figure fails to tell the whole story. The entire program contingency fund is used up years before construction ends.”

Why are rates set to increase so? Not only is there the cost of the improvement program, which should make the water system more reliable, but also SFPUC has morphed from a sleepy city department to Big Shot Money Bags. San Francisco Public Utilities Commission (SFPUC) needs no voter authorization to sell bonds (incur debt). Consequently, in challenging times for other city departments, SFPUC can step up. In recent years it has taken over fire protection duties, Lake Merced (from Rec & Park), the irrigation of golf courses, street sweeping costs, GoSolar, and much more. It has built itself a beautiful new office building, paying the city $9.9 million for property for which the city paid $2. It is bestowing “community benefits” throughout poor neighborhoods. Elected officials love spreading the wealth by bestowing community benefits; grateful beneficiaries support the officials. Even way out in Sunol, SFPUC throws parties for folks. At a recent meeting, SFPUC authorized $400,000 for a demonstration garden and outdoor classroom, $900,000 for an “interpretative facility” in Sunol providing information about the Alameda Creek watershed, and $9,500,000 for “energy efficiency” for various other city departments. It’s got plenty of money and clout.

Still wonder why your water rates are going to double again?

Just gettin’ warmed up: The Sewer System Improvement Program (SSIP) is three times as costly to City ratepayers as is the WSIP. The SSIP is just being launched. Employees on one project can move on to the next. Sewer rates are already higher than water rates. You do the math. Or just reach for a drink—and probably not water.

The Revenue Bond Oversight Committee is supposed to oversee SFPUC’s spending of bond monies, insuring that the spending is proper. For the second year in a row, however, the RBOC has failed to issue an annual report about its work on time. So here we have the group that is supposed to insure that spending is copasetic, yet it is unable to follow its own rules and issue a simple annual report. That’s city government is a nutshell. Nut shell indeed.

Batting .333 with SFPUC. The SFPUC offers tours to the public that can be rewarding. But for the writer, over the past year only one in three actually panned out. That one, a tour of the new headquarters building at 525 Golden Gate, was impressive. I also registered for a tour of the Hetch Hetchy water system, one that was to have taken me by van all the way to the source in the Sierras, but then was never contacted. Responding to a Facebook invitation that last minute places were available on a tour of the Oceanside Treatment Plant, the only way to submit one’s application was by mail. The tour was the next day. While one could fill out the application online, there was no way to submit it online. Bureaucratic SNAFU—situation normal, all fouled up.

Pension reef. Will San Francisco’s city employee pension fund hit a reef, and wreck like the Costa Concordia did in Italy, or will it negotiate choppy waters? That’s the big question. At nearly $15 billion in size, and obligations more than a match, it’s no small matter.

The Civil Grand Jury opines that the pension fund, large though it is, is not large enough, embraces policies that threaten disastrous losses, and over-estimates future returns.

What to do? No easy fixes are proposed. The City should pay in over $700 million, about ten percent of the City’s annual budget, over the next few years. No current office holder wants to forgo spreading the wealth today to shore up a pension fund that provides for the future. No friends won by withholding today; spend now, worry tomorrow. We’ve seen where this can lead—Stockton, San Bernardino, Detroit. But we’re different, right? It won’t happen to us, will it? Sail on!

Sail Away. It’s begun to look like our America’s Cup runneth far from over-full. Losses of $20 million dollars are being forecast by our crystal ball gazers. As for the thousands of jobs? Blown away.

What happened? Twelve estimated entrants shrunk to a mere three. Sales taxes and hotel taxes generated may still make the event worthwhile, some city officials say.

So when does it all happen? On the Fourth of July (a Thursday this year) the grand, and long, event kicks off. The challenger, the “Louis Vuitton Cup” winner, is chosen in the last days of August. Then the defense of the Cup races, seventeen competitions, are scheduled for September 7-21.

Fleet Week? It could be canceled this year, a victim of the sequester. If it flies, Angels from October 10, fleet October 12.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

March 2013

Robust Local Buildout

CleanPowerSF, the city’s renewable electric power alternative to PG&E, is expected to launch its first phase late this year. Customers who are invited to join and who do not opt out will pay extra to receive 100% renewably generated electricity. Initially this renewable electricity will be purchased by Shell Energy for CleanPowerSF. (More below on what premium you would pay.)

While initially renewable electric power for CleanPowerSF’s customers will be purchased on the open market, that may not last; a key goal of the program is to replace power generated out-of-town with locally-generated renewable power. Officials promise a “robust local buildout” to achieve this. The goal is to supply all of San Francisco’s needs with locally-generated renewable electric power. Really? All?

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The SFPUC’s own consultant disses the CleanPowerSF phase one program as “not competitive, achieves no jobs, no security; very similar to PG&E proposed ‘Deep Green’ rate…except more expensive.”

Hard though it may be to believe, now before the San Francisco Public Utilities Commission is a plan to spend a billion and a half dollars for green generation facilities.

So what will be built? How does San Francisco generate electricity from renewable sources right here in town? Windmills a-top Twin Peaks? How much local generation is needed?

So far windmills on Twin Peaks are not proposed. San Francisco now has 13 solar arrays and 2 biogas generators. The 13 solar arrays offer a capacity of 7.4 MW. San Francisco needs one hundred times more megawatts, so many more solar arrays would be constructed. Like 600 more. Six-hundred?

If recommendations of SFPUC’s consultant are followed, to eliminate risk for the willing customer, and so that benefits are immediate, CleanPowerSF would finance, install, operate, and maintain renewable generation facilities on private property under “shared savings agreements.” Three thousand jobs are promised. No wonder a billion and a half dollars of debt is forecast. This plan is rife with the possibility for disputes, empowers teams of bureaucrats, and opens another avenue for favoritism and corruption in a city wide open to such evils already.

While the buildout is described as both “robust” and “local,” “local” is broadly construed. Oakville, in the Central Valley, is the proposed site of one large solar facility. The cost is estimated at $210 million. A “regional” wind farm is proposed.

San Francisco has studied generating electricity by tidal power, but found that not feasible.

Wave power has also been studied and is considered feasible. The 2009 report on wave power proposes a 30 megawatt “farm” 7 miles west of the Zoo in 110 feet of water. Gray whales must be accommodated; they migrate, and must not be disturbed. The capital cost is estimated to be $120-140 million; O&M cost is hard to determine from the report, but annually seems somewhere between about 4% and 40%. The report cautions that “there is great uncertainty” concerning cost. Per kilowatt hour the cost is said to be 17-22 cents.

San Francisco uses about 5800 million kilowatt hours of electricity a year. Electricity usage is increasing. With electric vehicles, demand seems likely to grow even faster. Today about 28% of electricity consumption is residential. Very little electricity is generated locally. Despite much crowing about, and spending on, solar arrays, solar supplies just a tiny fraction. While much more solar could be installed, good locations are taken and returns are diminishing. Wave power? Well, maybe, but the cost is very uncertain, and waves, too, would supply only a small fraction of what is consumed. What else is there? Re-opening the Geysers is one possibility, i.e. geothermal.

Another listed generator is “electric, steam and natural gas.” This may also be called “combined heat and power,” which is estimated to cost $191 million capital cost. Renewable? Gas? $60 million is proposed to be spent for natural gas — how is that “renewable?”

What else will be robustly, and locally, built out? Stay tuned; much is undecided.

Is all this just a passing fantasy of city bureaucrats and officials? Is the city serious about providing its own local and “renewable” electricity, or is this bluster of green good intentions? The Board of Supervisors has been intent on creating a CCA (community choice aggregation entity), as Marin has. Bureaucrats have named it CleanPowerSF (note: not using the word “renewable”). Just what it will be, and how expensive and intrusive, remains unknown. All that seems sure is that City government will grow, providing electricity to customers once served by PG&E. A first step to public power and kicking PG&E out of town? Perhaps.

For this year, residential customers in San Francisco may become customers of CleanPowerSF, Phase One. Not all customers will be invited. The Westside is considered less enthusiastic, so homeowners here may not receive invitations. (If you want to join, there will be a way.) For those who do receive invitation notices, unless you opt out, you join. If you join, how much more will you pay for electricity that is said to be 100% generated by renewable sources? That depends on what your monthly bill is. Your overall gas & electric bill will exceed what you would pay to PG&E by some 15% and 27%. Here are examples, which, unfortunately, include an unknown gas component: 288 kilowatt hours (kWh) of electricity for which you would pay in your electric and gas bill $76.76 to PG&E, you will pay $21.21 more if you are enrolled in the CleanPowerSF program. But that electricity usage is less than most household use in a month. If you use 406 kWh and would typically pay PG&E for both electric and gas $127.51, then if enrolled in the city program you will pay $29.86 more; if 606 kWh paying a PG&E bill of $237.29, then you pay $44.56 more for 100% renewable; if 1122 kWh is your use, paying PG&E $542.43, under the CleanPowerSF program you’d pay $82.50 more. As you use more electricity, your “green” premium falls as a percentage of your bill. (It’s a city program; no one claims that it makes sense.)

$19.5 million must be appropriated by the Board of Supervisors to finance the launch of CleanPowerSF. While not yet done, the Board has pushed SFPUC to move this. The program also benefits the poor; this builds in a constituency. It gives $2 million to GoSolar (another constituency). Energy efficiency receives a couple of million.

The SFPUC’s own consultant disses the CleanPowerSF phase one program as “not competitive, achieves no jobs, no security; very similar to PG&E proposed ‘Deep Green’ rate…except more expensive.” The consultant advises, accelerate the robust local buildout, include Hetchy power (which is clean but not renewable) in the mix, and buy RECs, renewable energy credits, which are modern day indul-
gences—I sinned, but paid for good works.

In other words, consultant sez, don’t put your toe in, jump in! What’s a billion-and-a-half in SF? Be roBUST!

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

February 2013

Guns and Hoses.

In September SFPUC sued to evict the Gun Club that has aimed at Lake Merced for nearly eighty years. The Club’s lease dates from 1934. Lead shot and clay pigeons pooped up the Lake, and should be cleaned up. But the Club has not taken responsibility. For many years its month-to-month lease was handled by Rec & Park. Insurance? Maybe.... Assets? Nyet. So after years of kicking the can down the road, legal action was filed. Well, formally. SFPUC quickly settled.

What a mess the settlement is. Incomplete sentences (look who’s saying!), inconsistent intents—it’s a waffle shop.contamination at the Pacific Rod & Gun Club

Perhaps the surest thing, though no certainty, is that the ratepayer will end up paying for most of the cleanup, which today is priced at over $10 million. Big surprise, huh? SFPUC has become the dumping ground for all sorts of financial follies in this city of yucks. Want to bestow “community benefits?” SFPUC. Want to bail out Rec & Park? SFPUC. Whether it’s solar silly or zapping putrescent PG&E, the ready answer is the department that does not need voter authorization to sell its bonds: SFPUC. Hose the ratepayer.

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A new 43-page lease modernizes the lease agreement. In it the City admits that there are no known defaults to date; did the Club default by polluting and failing to remedy that pollution? The Club agrees to indemnify City for the deposit of hazardous materials after the effective date of the new lease. ”

So what does the settlement call for? Surprise (not): the Gun Club stays, for now. But the City may terminate it later; the settlement tries to make doing that simpler. Yet it does so by substituting a 90-day notice period; remember, this was a month-to-month lease. A 1934 indemnity clause is retained so that the City may try to recover insurance money. A new 43-page lease modernizes the lease agreement. In it the City admits that there are no known defaults to date; did the Club default by polluting and failing to remedy that pollution? The Club agrees to indemnify City for the deposit of hazardous materials after the effective date of the new lease. The Club’s buildings are to be inspected, and brought up to Code. The Club is to carry $1 million environmental pollution liability insurance.

How much is rent? Ten thou up front security deposit, then $5000 per month.   

Sand Plan.

Ocean Beach is eroding. The ocean is rising. Already road surface and parking areas have been devoured by the ocean. But what is far more critical is buried: expensive, fairly new, sewage infrastructure that runs under Great Highway. This stores sewage and storm water, so the Oceanside plant is not overwhelmed when rains are heavy. Nothing is visible, but if the ocean erodes enough of the beach key infrastructure will be ruined, and will need to be rebuilt inshore—at much greater inconvenience and expense. Already most of the city’s sewage is treated on the east side of town (at Southeast, in Bayview), and the east side is not going to take more s—-.

What to do? There is an Ocean Beach Master Plan, created by SPUR, which contains some ideas. One is “managed retreat,” popular with Greens, which lets the ocean have its way. The master planners were, however, persuaded to temper the impulse to “let it go” so that the sewage infrastructure is preserved for a reasonable—or less unreasonable—useful life. Planners decided to protect the infrastructure through 2050, forty more years.

Forty years may sound like a lot today. But it means moving soon towards figuring out what to do, and laying the groundwork.

Along comes what may be called the sand plan. In bureaucratese, it is the San Francisco Littoral Cell Coastal Regional Sediment Management Plan. (Are bureaucrats paid by the word?)

The idea is to move sand from the site of surplus to that of deficit. This summer three hundred thousand cubic yards were moved from northern Ocean Beach to southern, where beaches are eroding.

Time will tell whether the sand protects the beach. Trouble is, when a southwesterly storm combines with high tides the new sand may quickly be swept into the ocean. The trucked sand is smaller grained stuff, more easily swept away. After years of quiet the ocean can suddenly turn ravenous. Mounds of fine-grained sand that grace the southern beach for a few years may be gone overnight, in one storm, providing little protection. Then, in emergency mode, the bureaucrats haul in big rocks, which deface the beach.

There are other coastal plans further south along the California coast. Ventura/Santa Barbara have one that recommends an artificial reef. These are said to enhance biodiversity, provide better surfing and recreational opportunities, and form a wider beach opposite the reef. That sounds like something that might protect sewage infrastructure. Yet so far here the idea has not caught on. Re-name it? “Artificial reef” doesn’t cut it? How about “biodiversifying reef?”


The $4.6 billion Water System Improvement Program (WSIP; pronounced “wee-sip”) is two-thirds complete, according to officials. With $2 billion more to spend the program is looking shaky in reaching its goal of “on time, on budget.” Indeed, on time is not going to happen. The largest project, which ten years ago was to be completed by 2009, still has five years to go. Its cost is up, too. Calaveras Dam is proving to be as sinister as its name.

The program’s contingency—the millions set aside to cover change orders—is drained. Four years before construction work wraps up.

Overruns are not unusual in public works construction. When it asks for bids the public entity must describe the underground conditions to be expected so that multiple contractors can bid, ensuring competitive prices. If actual conditions differ from what is described, then the contractor claims for extra compensation for what are called differing site conditions.

At the site of the new Calaveras Dam, a hillside turned out to have undetected ancient landslides. More of the hillside must be excavated. The change order will be for about $133 million.

Two tunneling projects are also encountering troubles, although fortunately the overruns expected will cost much less.

When the Sewer System program (SSIP) begins, differing site conditions may not cause such a huge overrun as Calaveras, but there will likely be more of them. It is hard to know what is underground in a city like San Francisco. Records are kept, but prove unreliable. The sewer work is expected to cost San Franciscans three times as much as the water work is costing. Rates are going up. Overall a typical monthly cost for both sewer and water is expected to ramp up from $76 to $264 in 2032). That is, if costs come in as expected.

The keystone of the water system, Hetch Hetchy Reservoir, has survived a first attack, Prop F. But the promoters will sue, hoping to achieve their aims through the courts, or perhaps through Congress. Should these opponents of Hetch Hetchy succeed, the cost of water will rise much more.

Water and sewer affect everything. Every business uses these services. As a customer, you pay.

Up, up and away! 

The Water Enterprise’s budget will rise nearly twenty percent this next fiscal year if officials get what they want. This space has warned that costs are rising rapidly, as must rates. Next in line: sewer charges; $6.9 billion is to be spent fixing sewers over twenty years, most of it during the next decade. If the work escalates as has the water work, the sewer work will grow to nearly nine billion dollars. But expect it to grow more: much more of the work will be under San Francisco streets, constituents will be noisier, and the water work’s scope of work was reduced considerably, while rising in cost. SFPUC is without a meaningful brake. Since 2002, when voters issued blank checks, other city departments have to get voter approval before undertaking sizable capital work, but not SFPUC. Whee.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

December 2012

Two Steps Back


The Board of Supervisors has advanced public power by endorsing CleanPowerSF. Progressives won, and also added an extra: a “robust” program is to specially accommodate low income and non-English speaking residents. Participating customers will spend an average of about $18 per month extra so that their electricity is claimed to be “100% renewable.” Bureaucrats are to make sure that low income customers feel welcome. This includes outreach in the customer’s preferred language, lower rates (20% off), and a smaller penalty for changing provider. Ice that cake!

How much more renewable energy generation will CleanPowerSF add? The promise is, “For every kilowatt-hour of energy program participants consume, an equivalent amount of renewable energy is produced.” Sure, but would the renewable kilowatt have been generated anyway? Is this a feel-good program for a city that excels in righteousness and superiority? Does renewable generation really rise, and how much—or how little? Is the program really about sticking PG&E in the eye, and laying the groundwork for public power? When will City government refrain from spending and expanding?

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SFPUC adds another $2.2 million project to its Water System Improvement Program with this (non-)explanation: “The costs for those activities were not included in the WSIP budget because it was assumed that they would be covered in the Water Enterprise operating budget …” Why were the activities—monitoring the restoration of vegetation at construction sites—not included in the operating budget? No need to say.”

Affordable housing.

Once private builders provided the City’s housing stock. The market dictated what to build, and competition controlled prices.

Could that work today? Probably not if the City continues with its recent practices and policies.

Housing in small, desirable San Francisco has long been expensive. After moving to the city at age 23, renting and living in communal houses, in 1983 my wife and I bought our first home, a two-bedroom townhouse, for $162,500. In today’s dollars that equates to $375,400. Today that sum would buy little. But the interest rate on our first mortgage was 12.5%. The monthly mortgage payment, $1650, is today’s equivalent of $3815. Today a mortgage of $630,000 for a home costing $700,000 with a ten percent down payment—less than the twenty percent we put down—requires monthly payments of $2829.

When I was a first-time home buyer one was on his own. You engaged a realtor; you applied to a bank for a mortgage loan.

Were I a first timer today, I would start by taking the City’s home buyer education course. Then, the new home buyer applies to the government. Buyer is told how much he or she can afford, and is given an assistance package—help with the down and with closing costs. Government dictates the mortgage loan terms. The actual home may be built with public funds collected from developers to build affordable housing. About half of the housing built here is “affordable,” which means publicly assisted.

Is this public involvement necessary? An improvement?

Or, does government first inflate the cost of housing, then, find housing too expensive, fund “affordable” housing? Government increases cost with red tape and delay, further increases cost by requiring that a portion of units be “affordable,” or, alternatively, the developer pays into an affordable housing fund so that the government can build.

Surely all this increases the power of government. But what does it do for the cost of housing? In the long run is housing more affordable?

San Francisco’s affordable housing efforts have been audited, receiving mixed results. An audit found that affordable housing is not properly marketed, sits empty, and those who cease to qualify often over-stay for long stretches. (No doubt bureaucrats are “too busy.”)

Whenever the government is involved, worry about favoritism and corruption, not to mention waste. Today you get put on a list and have a long wait. Your name may be “lost.” Or, having the right stuff perhaps your name rises on the list.

One purpose of affordable housing is to help the homeless. Another is to keep San Francisco diverse. Perhaps government must be involved in achieving these goals. But must government help the first time home buyer?

If San Francisco is to balance its budget and slow the growth of government spending it needs to do less, and should do what it does more efficiently.

Clear as mud.

SFPUC adds another $2.2 million project to its Water System Improvement Program with this (non-)explanation: “The costs for those activities were not included in the WSIP budget because it was assumed that they would be covered in the Water Enterprise operating budget but due to the immediate need to fund these activities, the WSIP will cover the cost of that work through October 2013.” Why were the activities—monitoring the restoration of vegetation at construction sites—not included in the operating budget? No need to say. This is what passes for City government transparency?

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

November 2012

Keystone FolliesHetch-Hetchy Dam

Nearly one hundred years ago engineers set out to bring water from the far-away Sierras to the newly rebuilt City, which had burned up in the aftermath of the Great Quake. Imagine bringing water from so far away, through many dozens of miles of tunnel and buried pipeline. Then imagine not having to pay for pumping millions of tons of water; gravity would do the work. A dam high in the remote mountains, the keystone of the system, would store sufficient water, and would propel the whole wondrous waterworks.

Now San Franciscans are asked whether to begin the process of removing the keystone.

We San Franciscans are richer than almost all cities of our size or larger, and do we spend! Perhaps our free spending is part of our attraction. Rents are high; there is great demand to live in our fair town.

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Spending three-quarters of a billion on City Hall, or $8850 per resident per year on City government ($7.3 billion for fiscal 2012-13), or for new sports venues, libraries, and parks is one thing. To spend an extra ten billion dollars in an attempt to restore a remote valley that is the keystone of our elegantly-engineered water system, to remove that keystone, would be folly. ”

Spending three-quarters of a billion on City Hall, or $8850 per resident per year on City government ($7.3 billion for fiscal 2012-13), or for new sports venues, libraries, and parks is one thing. To spend an extra ten billion dollars in an attempt to restore a remote valley that is the keystone of our elegantly-engineered water system, to remove that keystone, would be folly.

San Francisco is most of the way through updating our water system. By the time we are through (in 2017), water rates will have tripled. What was inexpensive, as well as extremely pure and fine tasting, will be average priced, and will be supplemented with less pure groundwater. The 1920s era engineering has served marvelously; soon it will meet modern seismic standards.

San Francisco’s Water Enterprise already has over $3.2 billion of debt outstanding. It is about half done with paying for the updating.

The next step—the reverse side of the same coin—is to update San Francisco’s old sewer system. Most water city dwellers use goes down the drain. Stormwater adds in. Updating our water system is costing the City about $2 billion; updating the sewer system will cost ratepayers about $7 billion.

After all this updating, the portion of the average San Franciscan’s income that pays for water and sewer doubles—to about 2.5%. This is at the limit of what is considered affordable. Should we add to that burden by tearing down the system’s keystone?

While some readers, and most San Franciscans, do not pay water and sewer bills directly, make no mistake: everyone pays. Rents eventually reflect the increased cost. Everyday prices that businesses charge must reflect the cost of utilities. Directly or not, no one escapes paying for water and sewer.

Proponents of the Hetchy initiative will claim that it calls only for study. Do not fall for this. The clear purpose and intent is to require the draining of Hetch Hetchy reservoir. This wheeled horse is not empty.

Recycled water will substitute? Come on. The enviros and NIMBYs have already hit the delete key on the City’s first recycled plant. The plant was to be built at the site of a dump at the far southwest end of Golden Gate Park. Seven-eighths of that plant’s recycled water was to go to irrigating the Park. How green good is that? San Francisco has been fooling with recycled water for more than twenty years, yet its purple pipes remain bone dry. Why? Face it: In a city like San Francisco recycled water is uneconomical, insufficient, of undesirable quality, and makes little sense—except as an expensive symbol. NIMBYs abound. At the very most, and at great cost, recycled water might provide one-tenth of the City’s water needs.

Conservation of water is also urged. We San Franciscans do conserve. We use much less than we did at the beginning of this millennium. Our per capita demand for water is lower than anywhere else in this country. Can we lower it further? Probably—a little. Officials have already committed to do that. We cannot grow our population and develop without doing that.

Civilized society requires water. Trees and parks and fine eateries don’t survive when parched.

Nor are we going to magically take the same water just further downstream. Where would it be stored? Low country water would need to be filtered; that would require a huge new investment. Our water system is designed as a gravity system; it relies on Hetch Hetchy.

It would be folly to discard the keystone of the water system on which San Francisco has relied for eighty years, and just updated.

Nor would it be “green.” Building all the needed replacement infrastructure would not only cost a fortune but also would heavily impact the environment. Lost permanently would be the forty percent of electricity generated by all the water released in controlled fashion from behind the dam at Hetch Hetchy. Wind and solar is not suddenly going to replace that. We have been spending to encourage those green sources for years, yet what has been erected supplies nothing near forty percent of the electricity that would be lost. Unlike water usage, demand for electricity continues to grow.

If you think that a City can always somehow survive, look at Detroit. Consider New Orleans. Cities can and do have near death experiences. Enough bad choices made, plus one big event, can decimate an urban area. Cities are vulnerable. Might San Francisco some day suffer a big event?

It’s fine for San Franciscans to be dreamers and innovative. We need that, and our innovative companies are the vanguard of the future. But remember that many fail. The market decides winners and losers. We translate desirable bravado to the public realm at the City’s peril. Water is not where you take big risks.

Keep the keystone.

Steve Lawrence is a Westside resident and SF Public Utility Commission stalwart. Feedback:

October 2012

Rate Rackets.

We San Franciscans reflexively run counter to the “less enlightened” heartland of these wide United States. Elsewhere, in response to the Great Recession, government is petulantly shrinking.

Here government grows. Seven-point-three billion is being spent by San Francisco this fiscal year, up from the previous year’s six-point-seven. Water rates doubled in the past five years. To improve the water system we are spending about two billion dollars of San Francisco money. Plans are to spend seven billion dollars on the sewer system. Sewer rates are poised to rise even more sharply than water rates have.

Seven billion dollars is on the order of $8500 per San Franciscan.

While most of the sewer spending comes during the first decade, spending will span twenty years. Rates are to rise to about three-and-a-half times what they are.

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Plans are to spend seven billion dollars on the sewer system. Sewer rates are poised to rise even more sharply than water rates have. Seven billion dollars is on the order of $8500 per San Franciscan.”

This massive new government program is called the Sewer System Improvement Program, SSIP. (Don’t even think about it; pronouncing “wee-sip” for WSIP, the water system improvement program, was bad enough.)

This summer our SF Public Utilities Commission is “validating” the SSIP program. The program is being proposed by civil servants who are advised by an eminent national consulting firm. The consulting firm has studied existing conditions, and—any surprise here?—has found that improvements are needed. A seven billion dollar program is recommended. The Commissioners could pare that price-tag, or add to it; but they will likely accept it.

Towards the end of the massive program, the average rate paid for sewer and water (the bill for both come together) will double as a percentage of income—average income. (For this calculation, average income is assumed to rise 3% per year for the twenty years. Good luck with that.)

While the SFPUC does at least make a show of considering “affordability,” it does so looking at “the average bill.” Like Diogenes’ honest man, Mr. average Joe Plumber has yet to be found. But certainly he or she is not a family man. Households in San Francisco often contain only one person. Perhaps a two person household, living in a smallish flat, is the SFPUC average. But if you have a family you may be a four person household, or larger. Probably you use more water than the average on which “affordability” is judged. If you do—and four people usually do use more than two—then your bills will not be proportionately higher than “average,” they will be much higher. Why? Because rates are tiered. That means that for the first three units (a quantity of water, about 2244 gallons) per month you pay at a low rate. Further water usage is paid at a high rate. Same with sewage; your bill for sewage is based on the quantity of water that you use. So if you happen to live in a household with more than the average number of people, you pay at a higher average rate for water and sewer service. While Joe Average’s bill may remain affordable, good luck if you are a family or group living in one household.

This is one reason families flee San Francisco. It is not too hard for one or two people to use little water, living in their small flat. They go out to dinner four times a week, keep only a few houseplants, and install only the coolest, greenest washers, dishwashers and toilets, receiving rebates. Or, perhaps they have their laundry done down at the corner. It is much harder to keep a yard and family using very little water. Tiered rates rocket the family’s bill into an unaffordable stratosphere.

In the stagflation of the 1970’s, property tax increases stung. In our era’s Great Recession and hobbled recovery, “taxes” are avoided, but government still finds revenue sources. It doesn’t take a Moonbeam.

Why does SFPUC consider affordability the way it does? SFPUC is firmly under the sway of the environmentalists. Enviros simply hate single family housing. Tier them down.

SFPUC did constitute study groups of ratepayers to better understand (and justify) how the upcoming massive SSIP program would go over with the public. One study group came from Bayview, one Chinese, one Spanish speaking, and yes, one, well, other. You may not be shocked to learn that the level of understanding of participants was found to be: not high. But SFPUC staff was pleased to find that as participants were educated and began to understand more acceptance of the SSIP program increased. In other words, the groups “worked.” (Hurray for us.)

Expect, then, plenty of “outreach,” to sell, ‘er educate, the public about the SSIP.

Should you live in a community affected by the sewer system work, you may receive “community benefits,” too. So important is community relations that there has come to be an assistant General Manager for community benefits at SFPUC.

This summer the SFPUC staff moved into plush new quarters. Their new, green, $200 million building is at 525 Golden Gate Avenue, and is complete with artworks and all manner of impressive innovations. Go tour it. For SFPUC it’s been quite a summer: “validating” and launching a $7 billion public works program, and moving to new offices.

San Franciscans don’t mind picking up the bill, do they?

Feedback: Steve Lawrence

September 2012


No Pinch in the Public Purse

Here in San Francisco we take pride in leading trends. But in over-paying public employees, we are part of a larger picture.

Throughout the country public employees command generous salaries and benefits. The twin towers of the dot com boom and 9/11 kicked the boom off. Back at the beginning of the new millennium, when a share of Yahoo sold for over $300 as analysts eschewed profits and revenues for page views, public office holders waxed generous. Money was pouring into the public fisc. Generous benefits were even easier to bestow than salary increases. Pension funds would earn outstanding returns, it could be assumed. The complacent public was too busy making fortunes—or dreaming of doing so—to question assumptions justifying assumed pension returns.

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We’re exceptional! A magic land where rules are suspended. No harsh arithmetic for us. We define the cutting edge. But we don’t get cut. Do we?”

Then came 9/11. Firemen and “first responders” were heroes. No way would we not take care of heroes.

Next came the great housing boom and bubble. Heard throughout cities were loud lamentations about how public employees—teachers, policemen, firefighters especially—could no longer afford to live in the communities in which they worked. Pressure mounted for even more compensation and benefits.

Times worked to the advantage of public employees. Union reps are rarely shy about using every advantage. On the other side of the “bargaining table” were elected office holders. Rarely do they choose to alienate union reps and members. Endorsement by the firefighters’ union wins campaign workers, contributions and votes.

And so we arrived at a place that is less than “sustainable,” to use a term so favored by public workers.

The Great Recession and housing market’s fizzle makes it harder for public officials to spend other people’s money. Inconveniently, elected officials must worry about bothersome budgets. Deficits persist; one-time accounting tricks are mostly used up. (Sell city hall, lease it back?)

After years of recession, recently the median public employee makes on the order of one-quarter to one-third more than the median private employee. In San Francisco, without considering benefits, $93,229 is the average annual pay for city workers. In the private sector it is said to be $78,228, 84% of the average city worker salary. But salary tells only part of the story. City workers receive much greater benefits, enjoy more job security, tend to work closer to public transit, and receive more liberality at work. Also, the measure of the private median salary is high: eight percent do not have jobs at all, and many who receive no salary are “independent contractors,” scraping by. Were these included in the pool of private employees when median “salary” is measured, you can safely bet that median would sink.

Back in the 20th Century, city workers traded off salary for security, liberality, and benefits. As a city worker you would never
get rich, but you had job security and perhaps a less demanding employer.

Today the public employee can get rich. One police captain earned nearly $539,000 last year. More than one hundred firemen earned over $200,000. There are bound to be many households of public employees here in San Francisco qualifying for Obama’s millionaire’s tax. (Earnings are from city sources, and do not include investment earnings, rents collected, etc.)

Is this fair? Sustainable in our economy? What can be done? Once a year Matier & Ross publicize the outsized salaries. That’s something, if there is shame. Bet that elected officials will be slow to act: not only have they enjoyed—and do still enjoy—the largess, but also they are loath to alienate public union supporters and contributors. Down that road lies grief and regret.

Only when the money and accounting tricks run out will elected officials act. Then, perhaps, “saviors” like Chris Christie may be born. San Francisco seems very far from getting such religion. San Francisco lacks even an organization of taxpayers and ratepayers.

City government spends something more than $8,000 per resident per year. Although most is collected from business, each San Franciscan pays indirectly: when you go out to eat, buy groceries and gas, and pay the PG&E bill. In setting prices you don’t imagine that business fails to pass through taxes paid, as well as water, sewer, and other utility bills, do you?

Not only does San Francisco spend liberally—we all know that—but also it borrows, and over-promises, very liberally. Forbes put SF’s unfunded pension liability at nearly $35,000 per household.

It will be a cold day in Hades before San Francisco politicians embrace austerity and cut the salaries or benefits of public employees. We admire Euro social welfare, but not European austerity. We’re exceptional! A magic land where rules are suspended. No harsh arithmetic for us. We define the cutting edge. But we don’t get cut. Do we?

Steve Lawrence is a longtime utility activist. Feedback:

July-Aug 2012

The Forever Bridge

The Sierra Club opposed the Golden Gate bridge. So did prominent San Franciscans—on esthetic, safety and financial grounds. Even the War Department doubted for a time; would a fallen bridge block entry to the Bay?

Now the elegant bridge is universally admired. What more defines San Francisco? The bridge is one of the best known structures in the world.

Color schemes for the bridge ranged from fog gray to black. One color not proposed was International Orange, now the bridge’s trademark. It came about accidentally. Primer happened to be that color, and it worked. Another color not proposed, and of course not used: gold.

Twice the bridge has been in danger of coming down: once during its construction, and again in the early 1950s. Both times wind, and a harmonic vibration that wind can cause, was the threat.

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Color schemes for the bridge ranged from fog gray to black. One color not proposed was International Orange, now the bridge’s trademark. It came about accidentally. Primer happened to be that color, and it worked. Another color not proposed, and of course not used: gold.”

Yet the bridge has lasted through war, earthquake, terror danger, and even the weight of celebration. It has lasted more than seventy-five years.

The bridge is an assemblage of statistical wonders. Over a million rivets, placed white hot, heated by coal fired forges. Eighty thousand miles of spliced wire formed into strands and compacted into cables capable of supporting 400 million pounds. Two hundred and fifty pairs of vertical steel rope supporting the roadway. Towers rising 746 feet above the water, taller than the Washington Monument. One hundred and thirty thousand cubic yards of concrete poured. A south pier more than a thousand feet offshore, built despite ripping tides of five to seven knots. Anchorages weighing 270 million pounds each. The stats go on and on.

No bridge like the Golden Gate had ever been built. Mathematicians who helped design the bridge did so without the aid of any computer; all calculations were by hand, on paper.

While today we know the bridge as graceful and beautiful, that was not preordained. An early design was called “an upside down rat-trap.”

Forgotten today are the battles of personalities, and financial interests. Ferry companies were obvious losers. Shipping interests feared that larger ships would not clear the bridge. Bankers took big risks, and collected 5.25% interest, too—an amount considered high, and, by some, unwarranted. Challengers sued—and lost.

Should the reader wish to delve into the building of the Golden Gate bridge more deeply, read Golden Gate: the Life and Times of America’s Greatest Bridge, by Kevin Starr.

When asked how long the bridge would last, its promoter, Joseph Strauss, replied, “Forever.” May he be close to right.

Steve Lawrence follows water and sewer issues.

June 2012


Purple Planning is a Curse on the Purse

On April 17 our water sewer and power people, SFPUC, reached out to talk about the latest plan to fill the City’s purple pipes. Purple piping conveys recycled water, which is used mainly for irrigation. But in San Francisco you may be excused if you misspeak and say “for irritation.”

It’s been twenty years since ordinances required developers to install purple piping. Still no recycled water flows through those pipes.

Not that our officials have been idle—there have been many plans. But all have dried up like a shallow pond in the desert sun.

Before the iteration recently introduced, the plan was to produce recycled water in Golden Gate Park. At the far west end, south of the soccer fields, there is a dump. Officials figured they’d improve on that by spending a hundred million and change on a state of the art plant producing high grade recycled water that even our picky Rec & Park Department would accept. But Park neighbors objected. “No Factory in our Park” became the war-cry, although 7/8ths of the irrigation water will be used in the Park.

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Perhaps “boondoggle” is too strong a word here, but when costs rise as they have, and purple piping stays dry for as long as it has and will, what is the better word?”

As officials lately explained, rather than face a certain lawsuit and endless resistance with uncertain outcome, they returned to the drawing board. They found that while space for their proposed purple plant was somewhat lacking at Oceanside Wastewater Treatment facility near the Zoo, it could be found at the Armory next door. They approached the California National Guard about taking a bit of that space, and cobbled together enough in which to stuff the proposed plant to produce recycled water.

What is recycled water, anyway? Briefly, recycled water is what comes out when sewage goes through three processing steps. Sewage is treated to primary level (step one) by simply allowing solids to sink, and lighter stuff (scum) to rise, skimming those off. Under the Clean Water Act of 1972 sewage must be further treated to “secondary” levels, and then the “effluent” is discharged into the Bay and ocean. Alternatively, it can be treated to a tertiary level and become “recycled water,” usable for irrigation. In San Francisco’s case—ever special—the level of treatment will be “advanced tertiary,” which adds a process called “reverse osmosis” (don’t ask), included because there are “sensitive plants” and pools, etc. in Golden Gate Park. Yes, it’s as expensive as it sounds.

So will all of the purple pipe finally be filled? No, actually much will stay as empty as it has been these past twenty years. Goals have been downsized.

Ten years ago the plan for the Westside was to build a plant generating ten million gallons per day (mgd), a whole lot, for the estimated cost of $110 million, or 11 million of capital cost per mgd. Six years ago the plan became to produce 4.4 mgd at a higher capital cost of about $200 million. More recently the plan became to generate 2 mgd—one-fifth of which is surplus capacity—for a capital cost of $156 million. If the surplus goes unused, the capital cost per unit (mgd) will be almost $100 million, about nine times what it was to have been a decade ago. As reconfigured, the new plant will be a two story affair, and will have underground storage. SFPUC believes it can negotiate for the Armory slice.

The outreach meeting was notable for all that is yet unknown. At the new location, will the cost rise? Which streets now need to be torn up for a pipeline to the Park (avoidable under the old plan)? Will operating costs rise? How many permanent employees are required? What is the cost of the “lease” from the Armory? Cost concern seems an orphan—officials just want it done, at any price.

Even before this latest change to plans, recycled water was to cost multiples of what groundwater and Hetchy water costs. Ratepayers will pay dearly to satisfy 2% of the City’s water demand. To date, planning the Westside Recycled Water project has cost about $10 million. That doesn’t include master plans of the 1990s and last decade.

So when will the Westside Recycled Water project be done? One thing that is known is that the schedule slips. The environmental review process re-starts, and is expected to take 2.5 years. Commencement of construction slips about three years, until 2016. While it’s a guess, construction of the Westside Recycled Water plant should finish up in 2019.

Perhaps “boondoggle” is too strong a word here, but when costs rise as they have, and purple piping stays dry for as long as it has and will, what is the better word?

Steve Lawrence follows water and sewer issues.

May 2012

Beach Master

A master plan for Ocean Beach is being prepared. Like the ocean itself, it generally soothes the spirit, yet may hint at wildness and trouble. Three-and-a-half miles of surf, sand, and sometimes, sun is the wild west of our worldly city.

A myriad of public agencies and private groups are interested in Ocean Beach: Rec & Park, the SF Public Utilities Commission, which operates sewer infrastructure, the Zoo, Public Works with the Great Highway, and federal and state agencies from Ft. Funston to Seal Rock. Private groups include surfers, environmentalists, anglers, park protectionists and more. To tame all these, an outsider of sorts, SPUR, came to the rescue to referee and compile The Master Plan. SPUR is San Francisco Planning and Urban Research, a downtown group specializing in long-term planning.

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Will the sewer infrastructure really be protected? A storage tunnel said to be essential to the plant is vulnerable. The plan protects it with a berm of cobble and sand, and then with a hard buried seawall. As the tunnel is quite deep, it is hard to imagine how the buried seawall can be constructed. The cobble and sand berm seems cosmetic, vulnerable to the incredible wash of storm surging ocean water.”

Abundant opportunity for public input was provided. Despite that, there is fair chance that the reader has never before heard of the effort.

Planning is a balancing and juggling act. Twenty-five years ago San Francisco invested heavily in sewer infrastructure out at Ocean Beach. That investment is at risk of destruction by ocean storm waves. Environmentalists demand that threatened bird species be protected, and wish the remainder of the beach to be as natural as possible. Bikers, fishermen, surfers, kids, hang-gliders, residents and many more weighed in with their own interests.

The draft plan that SPUR has published first identifies values to be advanced. They conflict with one another, so the trick is to advance the most, while keeping costs reasonable and everyone happy—or not too unhappy.

The values the plan incorporates include protection of infrastructure, ecology, access, recreation, wildness, and cooperation among agencies and groups—what might be called sharing. Ecology includes protecting bird species that rely on the beach for nesting and reproduction, as well as allowing nature to take its course and thrive despite human presence.

The draft plan brims with bureaucratese, so here is a super-summary:

• South of Sloat Boulevard the Great Highway will close to general traffic. The Great Highway will be re-routed to run just east of the Zoo. Why? The rising ocean threatens; in the winter of 2009-10 it took part of the road. Some day it will take more. The idea here is to bow to the inevitable, while working to create better access and connectivity. The philosophy is called “managed retreat.”

• North of Sloat the Great Highway will be reduced to two lanes. The oceanside space created will be used for amenities, for a promenade for bikers and walkers, and for dunes.

• Sand will continue to be placed, and dunes re-planted with native plantings—no more ice plant. Dunes will be allowed to migrate eastward (inland). Sand ladders for access, bike lanes, and parking, will be provided, and rest rooms.

• In the north, south of Land’s End and the Cliff House, where the parking area is wide, permeable paving and plantings will create a more natural and inviting space, while the ability to host events is maintained. Bikes and pedestrians will get better access.

• The sewer infrastructure, which is mainly just south of the Zoo, is to be protected with cobbles and sand, and a buried seawall. Instead of boulders, which have been dumped when the ocean threatens, as it did two winters ago, softly rounded cobbles would be imported and encapsulated with sand to create gentle dunes as barriers against the ocean’s wrath. Sand would come from the shipping channel courtesy of the Corps of Engineers, hopefully. No one is happy with the dumped boulders and rubble, a blight which would be cleaned up, or at least buried.

The cost of the plan is estimated to be $343 million. The work required will not be done all at once; it will be done over a span of many years.

The plan has good balance. The plan’s weakness? Will the sewer infrastructure really be protected? A storage tunnel said to be essential to the plant is vulnerable. The plan protects it with a berm of cobble and sand, and then with a hard buried seawall. As the tunnel is quite deep, it is hard to imagine how the buried seawall can be constructed. The cobble and sand berm seems cosmetic, vulnerable to the incredible wash of storm surging ocean water. Yet engineers can be imaginative. One hopes that where there’s a will, there’s a way...that is not overly expensive.

Steve Lawrence follows water and sewer issues. Feedback:

April 2012


Dissembling Government and Society

Civil society has come to mimic lawyers. Little lawyers, everywhere a little lawyer. No one more so than bureaucrats and those who work for government.

Nothing is quite as slippery as the English language. Twist it, shape it.

A few years ago I encountered a city attorney who found the word “four” ambiguous. Four could mean five, or even six or seven. A “four” year term of office might expand, if it was convenient.

That city attorney promised me a written explanation of how this feat was achieved. I looked forward to receiving it. Promised was a demonstration of verbal gymnastics beyond what I had imagined possible. But despite many follow-ups, I never did receive that explanation.

City attorneys need not deal with “the little people,” mere members of the public. Promises made are unenforceable, and like bureaucratic expressions generally, slippery.

Most bureaucrats take themselves to be above the law, unaccountable to the little people of the general public.

One minor bureaucratic body is called Ree-bok, the Revenue Bond Oversight Committee (RBOC). It is charged with overseeing the expenditure of billions of dollars of ratepayer money borrowed through the selling of bonds. Although this group is paid for its services, and would seem to have a significant responsibility, and although hardly any members of the public attend to its doings, still it pointedly ignores or actively puts down those few who do try. Even the lowliest bureaucrat wants to feel powerful and superior.

Not only does RBOC diss those members of the public who try to approach, but also it dishonors its own simple bylaws. Bylaws require that each January, RBOC is to elect officers and adopt an annual report. Simple. But this year RBOC may have decided that “the first meeting of the year” could be the first meeting after Chinese New Year. Are words not a wonderful thing to twist and shape?

Imagine: the group on whom ratepayers rely to make sure bond funds are properly spent in accordance with law flips off its own bylaws. That’s accountability, SF style.

Each appointee to a public body such as RBOC takes an oath. Each knows that there are open government laws to encourage public participation in the decision making process of public business. Those taking their oath and accepting a public position should understand that extra listening and patience will be required. Why, then, do almost all “public servants” come to despise, avoid and put down members of the public who come before them?

US society has come to have low regard for rules and law, and ever higher regard for power. Words are ignored or manipulated. Get a lawyer, or be like one. Power up.

So it is with the “highest” of us in SF. Fourteen months ago when our Mayor wished to be appointed interim mayor, he pledged that he would not run for a full term. Mere words! With fingers crossed, and “Run, Ed, Run” encouragement, those words were left behind. The electorate’s verdict? Ratified, decisively. Every child, every citizen, every appointee was instructed in the importance of words.

Words have become plastic and disposable. Even the most clear and definite of them: “four”; clear and simple bylaws; a solemn pledge to the public and fellow public officials.

In governance—and I’ll contend in the wider society, too—we no longer expect words to have much meaning. All is relative.

As government enlarges, words multiply...and mean less and less.

According to the Supreme Court, our society’s highest interpreter of words, the Constitution, properly viewed, has “penumbras.” Penumbras are that faint ring that one sees around a winter moon, a sort of aura. If words are inconveniently absent in the Constitution then interpretation of penumbra makes law. Supreme justices just make it up. Does this differ materially from reading tea leaves?

Led thusly, perhaps it is little wonder that we citizens, bureaucrats emphatically included, have come to disrespect words, devalue honesty, and value only position and power.


March 2012

Growing ExpansivelyHetch-Hetchy Dam

Government expands. Let’s look at our providers of Water, Power and Sewer services, the San Francisco Public Utilities Commission (SFPUC), an “enterprise department” of the City. Its recently published annual report helps tell the tale.

Over the past five years, spending has risen at a pace of about 6.5% per year, nearly 36% in five years, to $695 million. While not growing quite as rapidly as China’s economy, this city agency, about to occupy a spiffy new headquarters building, is growing briskly.

More is coming. Soon SFPUC launches its Sewer System Improvement Program, a $6-8 billion work updating city sewers and plant. In the upcoming fiscal year $236 million is to be spent.

This year SFPUC expects to launch its CleanPowerSF program to partially displace PG&E as provider of electricity. CleanPowerSF will offer “clean” electricity generated solely by renewables or hydropower for a premium of, hopefully, $7-15 per month.

The Sewer System program and CleanPowerSF are just two of many initiatives and programs. GoSolar, building its super-green headquarters building, reclaiming Lake Merced, recycled water, gray water, community benefits, energy efficiency, and many other programs have been fueling growth.

SFPUC employs 2300, not quite one-tenth of the City’s workforce. This figure does not include the many consultants, contractors and others who are not employed as city employees, but are doing the agency’s work.

To illustrate the imperative of growth, let us examine one initiative from this past year: the updated Electricity Resource Plan of 2011.

While one can be cynical about bureaucratic plans, hundreds if not thousands of which cram shelves of our main library’s government information center, and hold down City Hall (in danger of floating skyward on hot air), some plans do lead to action. Surprising action.

The updated Electricity Resource Plan (ERP) sets the mile-high goal of achieving zero greenhouse gas emissions by year 2030. Zero. You can’t say our bureaucrats don’t dare to aim high.

In order to clear the bar, big leaps are required. As PG&E cannot be counted on, bureaucrats and progressives feel it needs to be replaced. The City must “control its own destiny.” To replace PG&E means public power. CleanPowerSF is the first step.

Other actions required to eliminate greenhouse gases by 2030 include building renewable generation facilities such as the solar arrays blanketing Moscone Center, the Sunset Reservoir and many other City facilities. The building of generation facilities, called by progressives “robust local buildout,” does not make much financial sense. The City’s Hetchy system generates electricity cheaply when water stored behind the Hetch Hetchy dam flows west to local use and storage. Surplus electricity is sold to irrigation districts at cost. Instead of using that cheap electricity, the City builds expensive solar here in the City. It replaces cheap clean electricity with expensive renewable power. It’s a plan only a bureaucrat could love.

One reason the bureaucrats do love the scheme is that it helps generate a fund of money they can use. By selling more to the irrigation districts, there is more money for GoSolar and similar subsidy programs controlled by the bureaucracy.

Understand that there are two pockets to the Hetchy water/power system: one holds debt, the other holds funds for bureaucrats to dispense. The system has been divided into two parts, call them East and West. West is deeply in debt; East holds a fund of money. While we are told that GoSolar is paid for entirely out of the proceeds of selling electricity – and the implication is: not out of ratepayer funds – that is an artifice. There is one system that produces two goods, water and electricity. If the proceeds from selling electricity are diverted, as they are, then the “cost” of water is that much greater, and the ratepayer pays that much more for it. There is no free lunch; neither are GoSolar and other subsidies free. The bureaucracy makes subsidies appear free.

Thankfully, over the next four years one long-standing subsidy is to diminish. Now City facilities receive Hetchy electricity at no charge, or for a fraction of what the electricity costs. Hetchy Power (the East part) subsidizes City Hall, General Hospital, MUNI and more. One reason that SFPUC subsidizes energy efficiency is that City facilities lack incentive to reduce power consumption; they do not pay, or pay little. It’s a perfect bureaucratic double play: one subsidy leads to another, and to double jobs and power for bureaucrats.

Is robust expansion of SFPUC best? Its recent annual report is all roses. But there are bugs in those flowers. Revenues have been unexpectedly low. Inevitably this will push utility rates higher. Rates have already risen steeply--for water, doubling over five recent years. On the power side, even with the big water flows of these past few years, the power reserve fund is plummeting to negative territory; this is why the Commission recently decided to modestly reduce subsidies. Utility rates are going to rise, and steeply. The Commission President recently acknowledged that he expects resistance to upcoming rate increases, and possibly political push-back.

The reader must remember that utility rates affect nearly everything. It is not just your (modest) utility bills. From your breakfast coffee to what you pay for a nightcap at the local pub...almost all spending is affected when utility rates rise. Every business pays utility bills.

Should the City spend freely so that SF is “a green leader,” the better to attract young, smart, connected workers that propel high tech business? Or will SF become such a costly place to live and work that competitive edge is lost, along with tax base and diversity?


Who leads SFPUC next? Ed Harrington has announced his intention to retire. Harlan (repaint-the-new SUV) Kelly seems a chum of the Mayor. Despite his unfortunate newspaper debut, Kelly might work out well. The $5000 paint job was probably a cost effective lesson; Kelly is not a slow learner. Further, he is a people person. He would probably leave intact Harrington’s team of financial wizards. And he knows the organization. On its plate are big programs; thorough knowledge counts.


February 2012


Hang Those OrnamentsMoney Christmas Ornament

Ever noticed that the little extra expenses add up? How tempting is the seemingly insignificant little extra. What a pretty ornament!

Not that we don't already have too many.

It's the same or worse at the municipal level. Let's do something nice for those in favor.

Examine almost any agenda for a Commission meeting of the SFPUC and you will find ornaments, large and small. A large ornament can be a whole program, such as the CCA program (community choice aggregation), the holy child of progressive Supes. In October CleanPowerSF (the child's name) advanced. Displacing PG&E, beginning about July, this City program is to sell "100% clean" electric power to a target of 75,000 green San Francisco households. The additional cost will be about $7-15 per month added to the household's electric bill. Public power advocates are tickled pink.

But the majority of ornaments are smaller, are hardly noticeable on our already over-flowing municipal tree.

For example, in October the SFPUC (your water, sewer and public power supplier) agreed to buy "conservation credits." Is this like Al Gore's indulgences? Warm warning Al flew about the globe, using much energy while he railed against greenhouse gases and rallied the greens. To make up for his carbon-spewing ways he purchased carbon credits or offsets (indulgences), which made it all copacetic.

Similarly, SFPUC ornaments its tree by buying credits for "up to" $550,000 from Wildlands Inc. What is Wildlands Inc? Its website says it provides "custom mitigation banking solutions." The website pictures a handsome blue heron. "To restore, enhance, preserve, and perpetuity." How warm and wonderful.

Did SFPUC competitively bid to acquire this custom mitigation banking service? What is the service, exactly? It is hard to know; this ornament was authorized without discussion by the SFPUC Commission. The matter was on the consent calendar, meaning discussion was considered unnecessary.

And so it routinely goes. At the same meeting $100,000 was authorized for a pilot project to enhance water efficiency in community gardens. There we go; we spend $100,000 perhaps to teach gardeners how to water better? Also, an MOU (memorandum of understanding, a bureaucrat's contract) was authorized with the Arts Commission. A small water district just south of the City had its $106,000 contract increased by $209,000 to speed recycled water for Harding Park.

Of course compared to the $300 million operating budget for our municipal Water Enterprise—and to debt spending of that is perhaps double that this fiscal year—these October ornaments are dinky. With all its spending, how tempting it must be to steer a little here, a little there, to worthwhile groups and interests about whom feelings are warm. Cheer, cheer! For bureaucrats it can be Christmas all year! Even better when the spending is debt spending; we all know how using a credit card is so much easier than parting with cash.

Just as your little extras can add up to bloat your budget, so too do the tempting ornaments of public spending boost the rates you pay for water and sewer service. Bills for water and sewer are headed considerably higher. In a dozen years it is expected that the typical bill for sewer service will be about 3.25 times what it is today. Rates for water have doubled over the past five years; and over the next five years your water bill will increase by more than it has these past five.

When does the tree over-laden with ornaments tip over? When does a plucked public arise?

Have a merry holiday season!

Steve Lawrence is a longtime utility activist. Feedback:

December 2011


"Diapers and politicians should be changed often, and for the same reason."

Steve Lawrence

No, "noisy cries" is not the reason – although surely these will be heard. In the one case, loud and guileless; in the other, soft, seductive, sibilant and full of guile.

What politician can resist promising supporters what they want? A public servant who promotes the "general welfare" receives scant thanks, few contributions, and probably not many votes. "Support me and mine" is the overwhelming demand of today's voters. Successful politicians avoid saying no.

How might society encourage politicians to promote sound public policy rather than pay-back politics? In today's world it is hard to imagine.

In times past, perhaps there were larger problems, and less largess to spread, propelling real solutions. In the Great Depression the economy did not just fail to grow; it fell off a cliff. Unemployment reached 25%, and with households having but one breadwinner, unemployment was catastrophic. The safety net was flimsy. Attending to urgent problems was not optional. The size of your slice of the pie was not as important as whether there would there be any pie.

Let's hope we don't return to those days.

We need to stop accepting interest group-oriented, pay-back politics. It is destructive. Oh, it may achieve urgent goals in the short run. But it promotes narrowness, conflict, and a way of thinking inimical to achieving what is needed: government that promotes the general welfare without being overly expensive or overbearing.

Government is essential. Corruption — whether of the illegal variety, or simply favoring supporters — comes with the territory. One baby may soil his diaper more than another, but all need to be changed. So too with politicians and public servants in positions of authority.

Promote those least tempted to wield power to favor friends, or punish enemies. Look for those who seek out ways to promote the general welfare and good public policy. Let it not be about how much I and mine can get from government. Wu wei. Non-interference. It is time for government with a lighter touch.

Rates for sewer and water service. This space writes about the lowly: water and sewer. For the lifetime of the reader, rates have been remarkably low. But that is changing. Water rates have doubled over the past five years, and, well above the rate of inflation, will continue to rise to pay for the $4.6 billion Water System Improvement Program. Sewer rates will rise sharply once the Sewer System Improvement Program gets going. These past few years the program has been delayed, although the interim program has been extended in time and scope, and has more than doubled in cost. On the main sewer program $4.1 billion is to be spent during the upcoming ten years; the total bill for the program is $7-8 billion (nearly $10,000 per San Franciscan).

The SFPUC, the city department providing water and sewer service, has estimated rate increases needed to pay for all the work. In the fifteen years between 2005-6 and 2020-1 the typical bill for both water and sewer will be 4.3 times higher than it was. The typical monthly bill was $45.35, and will rise to $195.84. In terms of "affordability", for a typical household with a 2009 income of $70,644, the cost of water and sewer service was about 1.35% of income; that will rise to over 2.5% in the late 2020s. (Assumes incomes rise at 3% per year.)

All projections are based on assumptions that may prove inaccurate.

Ocean Beach. Two winters ago the beach and cliffs south of the western end of Sloat Blvd, at the Zoo and beyond, were dangerously eroded by ocean waves. Part of the Great Highway had to be closed, and then moved inland, and even more seriously, sewer infrastructure was endangered. Winters will go by without incident, but then, suddenly, tides and storms can combine to change the coastline in a matter of hours.

To address storm erosion among other matters, a master plan is being prepared by SPUR. Whether to try to protect the highway and sewer infrastructure, and how, is a prime question. This past summer the Coastal Commission disapproved of rock that had been dumped as an emergency barrier, and also of a proposed pile wall. Now the idea that seems best is for sand from the shipping channel to be placed on the beach and then made into "vegetated dunes." Hopefully this sand will slow the advance of the occasionally angry ocean, and will save the infrastructure. If, one of these winters, the sewer infrastructure falls to the relentless ocean, ratepayers will have yet another big bill. Let's hope that funding for protection is found, and that effective protection is put in place in time.

Steve Lawrence is a longtime utility activist. Feedback:

November 2011


Bond Funds Forever — for Whatever

Sophisticated voters know that bond funds are not necessarily spent as campaign literature promises. Laguna Honda Hospital is Exhibit A.

Once bureaucrats acquire bond funds, they may change course and spend pretty much as they please. Bond funds become spending money.

Voters are being told that $248 million will be spent paving city streets. Maybe. But it is very possible that a fair portion will be spent building bike lanes, handicap ramps, and mini-parks, or on traffic calming, islands, planting trees, or studying whatever consultants can dream up.

Because of the looseness with which bond funds are spent, lobbying drives bond fund spending. For example, nine years ago voters passed a bond measure funding improvements to the Hetchy water system. The proposal was to make the Hetchy water system seismically sound, drought-resistant, and provide about 20% more water — enough water to serve through 2030.

Since then, the now $4.6 billion program has dropped the goal of providing sufficient water through 2030. Environmentalists objected.

The greens also grabbed lots of the bond money for their preferred purposes. A $12 million program EIR, not a part of the original program, was their opening act. A project was devised to spend $20 million on "watersheds," parts of which are not even upstream from reservoirs. Another project was created to protect "habitat"; weed-like, that habitat project has grown to $89 million. Your water bill is rising much faster than the oceans; some of that rise flows from incessant and successful lobbying.

There is no good way to add up green spending. For example, greens got small dams removed from Alameda Creek. This seemed innocuous. But with dams gone it turned out that certain protected fish might reach further upstream to the site of a major project. Now those fish need to be accommodated by that project. The cost of accommodating the fish is beyond knowing, but is large.

As one who has followed the program, now called Water System Improvement Program, from its inception, I can assure the reader that hundreds of millions of dollars of spending, and delay time, has resulted from green lobbying.

It is a mistake to imagine that groups such as the Chamber of Commerce or SPUR will follow-up to protect the interests of the citizen and ratepayer. Such blue-ribbon groups supported the bond measure, and then dropped the matter, moving right on to the next cause.

It is the rare citizen watchdog that is up to creating a movement and then sticking with it for years.

On the other hand, greens do their lobbying through non-profits. Non-profits hire professional advocates. Careers are dedicated to the cause. Advocates join and dominate citizen advisory committees. They attend and speak up at commission meetings. They get commissioners appointed. Fierce commitment and endless advocacy is effective.

So when you vote for the City to go into debt by funding some public improvement with bonds, remember that the good you hope will be done may be illusory. If special interests can hijack the bond funds, or a portion of them, they will. Certainly they will try. Bureaucrats and politicians will tend to make decisions in favor of those who appear before them, apply pressure, and make themselves heard.

Once bond money is in hand, there is little incentive to spend strictly in accordance with the voters' intent. Besides, politicians and bureaucrats are clever enough not to tie their own hands. Bond measures are chock full of caveats and loopholes, insuring flexibility. Steering millions of dollars of spending is one of the perks of public service.

Approval of voters is not even required for much bond and debt spending. COPs (certificates of participation) are used as one way to spend without voter approval. SFPUC (Water Sewer Power) revenue bonds in any amount may be issued without voter approval.

The sewer system is to get $7-8 billion of work over the next twenty years, an average of over $300 million a year. Documents suggest that in a dozen years time, the typical, average monthly bill for sewer and water will be $241, far above today's. For that you will receive about 15% less water than you use today. Your say in the matter? Flushed away yesterday.

When authorizing bond spending, vote with care.

Steve Lawrence is a longtime utility activist. Feedback:

October 2011


It's Only (Your Ratepayer) Money

To the citizen on a budget, spending in San Francisco's public realm can seem unreal.

Let's examine one recent agenda from the San Francisco Public Utilities Commission, the folks who provide water, sewer service, and, for now, power for MUNI, General Hospital, City Hall, and other public places.

Three lucky engineering firms get contract amendments worth $6,700,000. For what? For "engineering design services." After the amendments, the contracts the three have are worth $45.5 million.

Four less lucky engineering firms get amendments each worth $2.7 million. This is for "continued engineering design and real estate services."

Seven firms get only time, no money. Yet.

Firms providing "ongoing environmental analysis services" ring up $7.8 million in amendments, bringing their contracts to a total of $19.47 million. As a percentage increase, ongoing environmental analysis is where it's at during this recent month.

Then there's "design, engineering and commissioning" services provided by a consultant who will also provide technical expertise on compliance with the Federal Energy Regulatory Commission. This firm is awarded a $6 million contract.

Another engineering firm is awarded another $6 million contract to inspect construction, and provide "program management support and technical services (general and review support)". That sure is specific. Not.

For CCA, community choice aggregation, which is the City's move to push aside PG&E as the main supplier of electricity to the city, two firms get one-year extensions to their contracts. No amount of money is mentioned.

A goodly portion of authority to spend on consultants is found on the "consent calendar," which is used when no opposition or discussion is expected. The General Manager (chief bureaucrat) is often empowered to negotiate consulting contracts and amendments.

Rarely are there more than a couple of questions from commissioners about such spending matters. It is very rare indeed for a vote on spending not to be unanimous. No one asks, "…what are the soft costs for this program as a percentage of the construction costs?" Rare it is for a commissioner to ask what the services are for, or, if a contract is amended, why they were not provided for originally. Often the agenda does not allow the reader to understand what programs or projects are being advanced by a seemingly endless parade of expensive consulting services.

Thus are many millions spent and added to your water and sewer bills. The City projects big population growth, and even bigger job growth in coming years. If that growth does not materialize, water and sewer bills will be split fewer ways.

The average citizen can hardly be expected to read the agenda, study the matters, and be heard at meetings. But lobbyists and special interests are there, you can count on it.

Do organizations such as the Chamber of Commerce or SPUR monitor such spending? No.

There is a committee constituted to oversee bond spending, but it has been completely tamed and neutralized. Recently the Revenue Bond Oversight Committee has spent most of its time hiring its own consultant, picking from an approved list given to it by the City and its bureaucrats. This committee, members of which are paid a small stipend, has had the same Chair almost since its inception. When a citizen offers suggestions about what it might investigate, silence is generally the reply. Ratepayers cannot count on the oversight committee.

Perhaps a focus on mere millions spent on consultants is misplaced. The City sewer system wants $8 billion of spending attention. That's 32 times what is asked this November for fixing City streets.

But you won't be asked to vote on bond spending for the upcoming sewer system work. Nine years ago voters abandoned their prerogative to vote before such spending.

$4.6 billion is being spent on the water system. One-third of that sum has been expended (through June). Recently the program's completion was delayed seven months, and is now expected in July 2016. For the five years until program completion, $50 million per month is projected to be spent.

Spending isn't just a state and federal issue. Recently Uncle Sam upped his debt ceiling by 17%, sufficient for only two years. During President Obama's first term, federal indebtedness is expected to increase by more than 50%, just as the older of the baby boomers arrive at age 65. Cities need not follow the federal example, must they?

It's your ratepayer money being spent. Add it to the tab.

Steve Lawrence is a longtime utility activist.


September 2011


Rising Cost of Utilities

Time for SF Taxpayer & Ratepayer Org?

On July 1 rates charged for water and sewer rose again. For water the rate rose about 13%. Over the past five years the cost of water has doubled. Sewer rates have been rising at an average of 7.5% per year; this year the rate increase is 3.6%.

Rates are sure to rise more. Water Power & Sewer, the new moniker for the city department still officially called San Francisco Public Utilities Commission (SFPUC), has completed a little more than one-third of its big work on the Hetchy water system. The $4.5 billion work program aims to allow the water system to survive a sizable quake, to better withstand drought, and to ease maintenance.

Big work on the sewer system is coming. Some high priority work has been done; much more is planned. An ambitious master plan was adopted last summer. During the next twenty years a very long list of sewer system improvements are to be accomplished. The price tag is $6 billion.

While in these days of debt and deficit we've all grown used to reading about billions (and even trillions, a million millions!), these are fearsome numbers, even for a big-spender like San Francisco. Adding what officials think will be spent on water and sewer system work, $4.5 and 6 billion, and dividing by let's say an expanded City population of 900,000, that is $11,667 per person for water and sewer work.

But that's not all. SFPUC also provides electric power. Today it provides power to City facilities. But SFPUC plans to soon replace PG&E, providing power—greener power, is the lure—to most of the City's homes and businesses. While this is not supposed to cost extra, when does the City undertake a major program at no cost to taxpayer or ratepayer? Good luck with that plan.

Then there are many special programs. Stormwater swales, toilet give-aways, GoSolar subsidies, and many more. Public agencies in San Francisco love to buy your love. There is no shortage of individuals and community groups bellying up to the ever-deeper public trough.

At a recent SFPUC Commission meeting, one of the commissioners brayed that SFPUC had not chosen to implement only the more cost effective water conservation programs, it had done all of them. It made sense to make such a statement: there were no ratepayer advocates present, only environmentalists. Commissioners pander to the extremists who work for nonprofits and attend meetings. The ratepayer? The Invisible Person.

Spending creates opportunities for public employees and politicians. Where to put the new recycled water plant? How about out in Golden Gate Park, which is Recreation & Park land? "Rent" can be paid which transfers ratepayer funds to a General Fund department without raising taxes. Spending at the behest of nonprofits creates a win for a nonprofit's lobbyist. For the public agency, spending on nonprofits and for their causes creates "community benefits" to publicize, and advances a "you scratch my back, I'll scratch yours" truce.

Soon more spending is likely to be needed. Ocean Beach is eroding. (See last month's column.) The treatment plant there, less than twenty years old — new for such a facility — is endangered. Either the beach needs to be seriously armored, or one of these years the ocean will undermine pipes and plant. Then billions will be needed to relocated critical infrastructure.

Today San Franciscans are lucky to have pure water to drink, and a relatively easy place to dispose of treated sewage. Electric power here is expensive, compared to other cities, but we need no air conditioning, so bills are still low. What is worrisome is the trend: Utilities are fast becoming much more expensive.

We've had it good, we still have it pretty good, but will we in a few years? Even if luck holds, and no large earthquake or other disaster strikes?

To begin to control run-away utility costs, might San Francisco benefit from a taxpayer and ratepayer organization?

Steve Lawrence spends his time thinking and writing about San Francisco's problems. Feedback:

July-August 2011

The Breach at Ocean BeachErosion at Ocean Beach

Ocean Beach is one of San Francisco's gems in the rough. What's up out there on the Western front?

All is not quiet. The beach is in retreat. In the past decade the boundary between ocean and beach moved east – quite a lot. While not noticeable to the casual beach walker, south of Sloat Blvd the beach is inland on the order of 235 feet of where it was in 2000. That's a lot of change.

Beach erosion happens suddenly. While the sea rises slowly, suddenly the right, or wrong, conditions combine, and then the ocean can claim chunks in short order. In no time a roadway is vulnerable, as Great Highway became last year; within hours, expensive sewage infrastructure, built to last a hundred years, is in danger of being undermined and destroyed.

It's a truism to say that Nature is dynamic, but in the case of the ocean versus Ocean Beach and its cliffs, it does take on poignant meaning.

What to do, other than watch Nature's awesome power? That is the question SPUR is addressing. (SPUR is San Francisco Planning and Urban Research Association, a non-profit.) SPUR is preparing a "master plan" for the 3.5 mile stretch of Ocean Beach. Perhaps the toughest question is how to deal with erosion and the advancing ocean. Protect the road and sewer infrastructure, or abandon to Nature?

So far we have protected human "improvements." But we do so mostly when danger approaches. Once danger passes, long-term protection measures bog down in controversy. The next crisis arrives, and then we react. Having a thought-through plan would be better.

Numerous agencies are involved at Ocean Beach. Among them, the Army Corps of Engineers, which maintains the Golden Gate's shipping channel, dumps sand in an attempt to replenish, or build up, the eroding beach. Department of Public Works has dumped rock, creating what is called a rock revetment, during winters of emergency. It expects to install a wall of piles in an attempt to save the bluffs. Other agencies protect endangered birds, the coast, and mediate between dog owners and others. Everything done and to be done at Ocean Beach must be done with sensitivity, and usually is preceded by outreach and process, which is time-consuming.

In stormy weather the Great Highway has become lesser. For a time a portion of southbound lanes was closed. Now a section is one lane instead of two, and that lane has been pushed eastward.

Your water rates have doubled over the past five years, and are set to increase another 13% July 1. Sewer rates are higher still. The major work to update the sewer system remains ahead. Planned work does not include relocating infrastructure at Ocean Beach.

Ocean Beach is where the city meets the wild. Surfers, bikers, fishermen, strollers, joggers, hang gliders, bird watchers...all find their way to this place to have fun and renew the spirit. The majesty and power of the great ocean lays, usually quietly, sometimes not, at the edge of our continent. That power is rising, relentlessly rising.


June 2011

Stink about Sewagesewer cover photo

Now that cell phones are everywhere, how easy it is to dial 311 and report that unpleasant odor wafting up from the street sewer.

Apparently increasing reports recently came to the attention of Supes. I’ll defer making a comment about how impossible it seems that that bunch could find objectionable the smell of sewer gas, given their own odoriferous business.

Hauling in a public employee, what the Supes heard was predictably defensive: yes, there were odors emanating from sewers, and more complaints about them, but such is not the fault of city workers. Low-flow toilets, climate change (including a warm, dry period mid-winter), and just more people living and wandering the flatlands of Mission Bay lead to gaseous complaints.

When the use of bleach to deal, disinfect and deodorize, was mentioned, environmentalists rose not only to defend low-flow toilets, but also to excoriate the shameful use of nasty chemicals. No, no, bleach does not flow into the Bay; it is neutralized to produce salts, the sewage folk (SFPUC) then explained.

It turns out that low-flow toilets save 20 million gallons of water. While that sounds like a lot, in fact it is about seven one-hundredths of one percent of the City’s annual water usage. A drop in the bucket. Still, the less liquid flushing sewage along, the smellier.

All of this stink occurs in a context that most citizens will have understandably forgotten. In early 2002 a plan seven years in the making emerged from SFPUC, the City department responsible for dealing with sewage. At that time the plan was to spend a billion bucks to upgrade the City’s sewer system and treatment plants.

Because there was opposition to components of the plan, and because SFPUC was most eager to acquire a larger chunk of money to fix the water system, the sewer plan was excised. SFPUC said it would return in two years, presenting a more agreeable plan.

Two years passed and all that happened was that $150 million of urgent fixes was presented; the remainder was deferred. Now, some nine years later, we still have no solid plan to upgrade the aging sewer system, although there is a draft Sewer System Improvement Plan. The draft plan would cost four billion dollars in 2010 money.

In 2002 there was one Communications employee at SFPUC to deal with the public. Today there are nineteen (down from twenty-two in better times). If you can’t fix a problem, talk about it.

SFPUC expects a firm plan to fix the sewer system to ripen one day. When? There are no firm dates or timelines; public employees operate timelessly.

How will rates be affected? So far SFPUC’s website lacks info, nor does the current draft Sewer System Improvement Program plan get to rates. But perhaps some guidance can be garnered from the water system improvement plan. That plan requires the City to pay about $2 billion, half of what the sewer improvement program is expected to cost. Water rates have doubled in the past five years and will rise at least as much over the next few years. As water rates will have tripled, or more, and as the sewer program will spend double what the water program is spending, might sewer rates rise by six times?

Last month’s column noted that rates for electricity are likely to rise with the coming of your new “green” electricity provider: CleanPowerSF, the City’s poke-in-the-eye, or kick in the butt, of PG&E. If you smell that utility rates are rapidly rising all ‘round in San Francisco, no, your nose is not out of sorts.

Out on City streets, though, if you smell stale odors, please don’t be too fast with that phone finger. You’re in for quite enough of a bill. Hold your nose, prepare to pay more, and pray it’s not too much more.

Steve Lawrence is a longtime ratepayer advocate.

May 2011

Zapping PG&E: Progressives Plant Public Powerplug

"As you sow, so shall you reap." That's the wisdom that San Francisco will test.

Progressives have long sought to plant public power in the abundantly fertilized soil of San Francisco. They are about to get their season. Let's hope the fruit isn't bitter.

An Updated Electricity Resource Plan was adopted last month and passed on to the Board of Supervisors. That plan advances public power, and seriously zaps PG&E.

Under the new plan, full public power is to serve Treasure Island and Hunters Point redevelopment areas. The remainder of the City will be served by CleanPowerSF, a new City-run electric power provider, called a CCA. CCA stands for community choice aggregation, or aggregator. It is a creature of state law arising out of the dark days of the energy crisis. Back then, when PG&E and other public utilities were on the brink, the idea was to empower cities to obtain and provide their own electricity.

Progressives took the CCA law and dyed it green. CleanPowerSF will promise to deliver cleaner, greener power than PG&E does. And, surprisingly, at a "comparable" price.

How will CleanPowerSF, run by City bureaucrats, start up, buy more renewably-generated power than PG&E does, and stay price-competitive? Let us count the ways.

First, startup costs of the CCA will be amortized. The costs are spread over many years, are deferred, so that rates in early years are lower.

Remember that PG&E's rates are the benchmark. When PG&E loses most of its customers in San Francisco, what will happen to its cost per unit of electricity sold? Up they will go; then so too will PG&E's rates. As PG&E's rates rise, "comparable" rates of CleanPowerSF will be able to rise, too. Quite a neat trick by City bureaucrats, that.

Initially, to lower rates, CleanPowerSF will blend in Hetchy power with more expensive renewable power. Hetchy power is generated when our drinking water flows down from Yosemite. Hetchy power is cheap: less than one-third of market rates. While it is not "renewable," it is "clean".

Another trick is that CleanPowerSF will create a special feel-good category of customer. This special customer pays extra to receive supposedly greener electricity. While special customers pay extra, what generates City electricity remains unchanged; grid electricity is generic.

By deferring costs, blending in Hetchy power, and creating a green goddess customer class, along with counting on PG&E's unit costs and rates rising once its customer base shrinks, CleanPowerSF hopes to keep rates "comparable" to PG&E's rates.

Yet another way that the City keeps apparent costs down has long been in place. The Hetchy water system is artificially divided into two "pockets", one for water and the other for electric power generated by that water flowing downhill. The water pocket holds debt—lots and lots of bond indebtedness. The electric power pocket is kept warm with cash. This pocket now funds GoSolar and many other programs that City politicians and bureaucrats love to provide.

The City-run CCA, CleanPowerSF, is to launch this year. Customers will begin seeing notices in their bills from PG&E. State law requires PG&E to cooperate with CleanPowerSF; PG&E tolls its own bell.

The coming CleanPowerSF notices will promise cleaner, greener power at the same initial price as PG&E electric power. While customers will have a chance to opt out, remaining with PG&E, few will. If a customer does nothing, the customer is switched to CleanPowerSF.

At present PG&E provides three-quarters of the electric power used in San Francisco. (Hetchy power for City Hall, MUNI, airport, General Hospital, etc. is 17%; 8% is provided by direct power providers to big users.) Once CleanPowerSF is launched, PG&E's share may drop to single digits.

And that is the idea behind this progressive push to plant public power in San Francisco. For four decades progressives have sought to oust PG&E. Nothing could please progressives more.

The rationale, expounded by the recently Updated Electricity Resource Plan mentioned above, is that only by controlling its own electric power destiny can San Francisco reach its goals. The key goal of the updated plan is to achieve by 2030 zero greenhouse gas emissions from electric power generation. Zero.

While the reader may scoff at such an idealistic and impossible goal, it drives today's action. It is necessary to form the CleanPowerSF CCA, and drive PG&E out of San Francisco, to make best efforts to achieve the zero goal. That is the reasoning of the Updated Electricity Resource Plan.

Cloaked in green, progressives push public power both directly for new developments, and through CleanPowerSF, a brave new company run by public employees that will displace PG&E.

Naturally, under CleanPowerSF there will be all the usual public programs: solar and wind incentives, "community benefits" (for poor communities), energy efficiency programs, low-income lifelines, and so forth. There will be aggressive targets to meet, or try to meet, regarding renewable generation of electricity. To the extent possible the City will generate renewable electricity within San Francisco, which is to become a "Green Test Bed."

Steve Lawrence is a longtime ratepayer advocate. Feedback: Steve Lawrence

April 2011

Recycled Water No Walk in the ParkSite for Recycled water plant

What tops water officials' wish-list? Recycled water does. Since the deep drought of the late 1980s and early 1990s, recycled water is a must-have.

In PC San Francisco, then, one would imagine that recycled water long flowed. Yet all that flows today are words and fury.

The problem is that recycled water must be produced at a physical treatment plant. Self-styled Park advocates are fighting furiously to keep what they call the recycled "factory" out of Golden Gate Park. Meanwhile, octopus-like, the bureaucratic process of "outreach" crawls.

The race to recycled water began twenty long years ago when ordinances were passed requiring that all but small developments prepare to accept recycled water for irrigation, and even for such wishful uses as flushing toilets. Reading those ordinances, one would think that recycled water was either available, or rapidly coming downstream. Ha!

Five years later, in 1996, a "master plan" floated in. In early 2002, a plan to produce 10 million gallons per day (mgd) was adopted. Recycled water was to serve about one-eighth of city water use. The capital cost was high, about $12 per gallon of capacity. For comparison, recent capital cost for other cities is $7 per gallon of capacity.

In 2006 another master plan issued. Under it, 4.5 mgd was to be produced—about half of what had been planned in 2002. Capital cost rose from $12 to about $45 per gallon of capacity. The voters had given their blessing in late 2002; no longer was there any need to keep the price-tag low.

Since 2006 the quantity of recycled water to be produced has steadily declined, and the cost per gallon of capacity has risen. Today the near-term plan is to produce 1.6 mgd, a third of what was to be produced in 2006, and less than one-sixth of the 2002 planned quantity. Capital cost of producing the 1.6 mgd is $95 per gallon of capacity, about eight times what voters were presented in 2002. The quantity to be produced would amount to just over two percent of San Francisco's water use, down from 12%. (Eastside recycled water may one day contribute another nearly 3%, if the dreams of bureaucrats are realized.)

As proposed now, the Westside recycled water facility would be sited in the southwestern corner of Golden Gate Park. Now the space is a dump; many years ago it was home to an old treatment plant. The proposed plant site is in the Park because Rec & Park insists that recycled water be treated to a high level of purity. "Sensitive" plants and lakes require purer water, according to Rec & Park.

Earlier plans called for production of recycled water at the Oceanside Wastewater Treatment Plant near the Zoo. But there is room at Oceanside only for ordinary filtration, officials insist. There is no room for the higher level of treatment, using a process called reverse osmosis, which Rec & Park demands.

About eight-five percent of the recycled water is to be used in the Park. The remainder is to be used to irrigate Lincoln Park, and Presidio Golf Course.

By splitting recycled water's production into two parts done at separate locations, it would be possible to locate treatment outside Golden Gate Park, officials concede. But it would cost more. Not only would two facilities need to be built and operated, but also the recycled water would need to be piped to the Park using a more costly route, through residential neighborhoods.

If recycled water is produced in the Park, there is a tunnel running roughly under the Great Highway that can be used to convey treated wastewater. But per the state Health & Safety Code, the existing tunnel cannot be used to convey already-produced recycled water. So, not only will the split treatment facilities cost more, but also a new pipeline must be built. That would be more costly and would impact residents and traffic in the outer Sunset.

Cost and convenience are lesser considerations for Park advocates who seek to keep the Park free of what they imaginatively style a "factory." Actually, the plant producing recycled water would be low profile. No smokestacks. There would be planted berms on three sides, screening trees in front, and a green living roof. For years the site has been a dump. Rec & Park has no money to develop it.

Any park needs irrigation water. Is it unreasonable that irrigation water be produced economically where it is used?

In San Francisco reason and cost considerations do not necessarily float to the top.

For twenty years our water officials have eagerly planned to produce recycled water. As time has passed, costs have risen—a lot. Volume has declined.

Where shall recycled water be made? In the Park, or in divided facilities elsewhere? We've had words a-plenty; our fair City will proudly produce recycled water some day, won't it?

(Alternative sites considered for the treatment plant to make recycled water include Sunset Circle, Harding Road, and the National Guard Armory, if the state will sell it. Recycled water is now scheduled to begin flowing in late 2015.)

Ed. Note: Steve Lawrence and Joan Girardot are two of the SFPUC's most vociferous longtime critics. When they are in agreement with the agency, SFPUC watchers take notice.

March 2011

Watchdogs, Lapdogs and Rubes

Just because there is an oversight committee does not mean there is effective oversight.

It is said that legislating is like making sausage. What is City governance like? Rube Goldberg comes to mind.

Rube Goldberg was a cartoonist who drew complex machines that performed simple tasks in very convoluted ways.

I follow the SFPUC, the San Francisco Public Utilities Commission, supplying water, sewer service and municipal power. Soon this city department will also supply electric power to homes and businesses, replacing PG&E. The department is one of the better run ones. Well-greased it may be, but the machine is complex and not what you might expect.

A decade ago there were well publicized “issues” with the spending of public bond money. At the Airport and City College, among others, bond funds were diverted and misspent. As a result requests for bond spending were accompanied with “oversight.”

Thus in 2002 when the so-called “rebuild” of the Hetch Hetchy water system was authorized--now a $4.6 billion bond funded program--an oversight committee was created. As public money had been misspent in the past, an oversight group would act as watchdog.

But as with anything in the public realm, the idea is one thing, implementation is quite another. Although SFPUC did not support the ballot measure creating the oversight group, once the measure passed SFPUC was keen to corral and control the group. It helped build the oversight machine. And SFPUC did a fine job of rubing and neutralizing.

Today on the oversight committee are members whose terms have long since expired. Frequently, there have been vacancies, and ghost members, who never attend. According to rules in this town, a vacancy is equal to a No vote for any action the committee would take. So vacancies and ghost members are popular. Committees with missing members have difficulty getting the votes to take action. How convenient for the bureaucracy!

On the other hand, another City rule keeps “members” on committees after they should be gone. Why would that be done? The public employee bureaucracy invests in each committee member. Members are wooed with benefits that the bureaucracy can bestow. In addition, the oversight committee members of whom I write are paid, monthly. Not a great deal, but members receive pay.

Terms are for four years. Now, you might think that “four” is a term capable of no ambiguity; everyone knows what “four” means. You should not be in San Francisco government if you think such a thing. “Four years” means any of a variety of things in San Francisco government, including five, six, or even more.

Now, wait a minute, how in the world can “four” mean “five”, even in San Francisco? “Holdover” is the key. When a member’s four years expires, if no new member is appointed by the responsible appointer (often the mayor or supervisors) then the member whose four years has expired may stay as a “holdover.”

Holdovers are very convenient for the public bureaucrats. Think about it. Holdovers have four full years of training. Naturally bureaucrats will live with the devil they know, and have tamed, rather than with the devil they don’t know. If a holdover begins to act up, quick as a wink his appointer can be awoken, and poof, he’s gone. This makes for very compliant holdover members. How convenient!

But, you may ask, how can a term of four years mean that a member can serve for five or six or more; four is specified; if a term were meant to be “until replaced,” then the ordinance could easily have, and would have, said so, would it not?

Having been an attorney myself, I asked that very question of the City attorney advising the commission about which I write. He promised me an answer, and I reminded him about that for many months. I never got an answer. City attorneys work in and for the public employee bureaucracy; what is best for that bureaucracy finds a way.

The committee about which I write is no major committee. There are hundreds of such committees scattered through San Francisco government. This particular oversight committee had members who were not San Franciscans, had a member who worked for a firm that contracted with SFPUC, benefitting from the millions of dollars going to consulting firms, and, as discussed above, has members whose terms have long expired, one expired in 2007.

In 2011 SFPUC expects to issue more than $1.25 billion in bonds under the committee’s jurisdiction.

Bonds are like charging on your credit card. It’s wonderful to be a big spender today. Tomorrow you pay, with interest. Ratepayers will be paying off bond indebtedness for thirty years.

As GM Ed Harrington said in the Wall Street Journal recently, average water rates will more than triple between 2003, when the water system’s capital program was launched, and 2015, when the work is supposed to be completed. Under the program as it was when it launched, water supply was to be assured through 2030. Under the program today, however, water supply is assured--with warts--through 2018. The program’s cost has risen about a billion dollars so far. It is about one-third completed.

“Oversight” is a fine concept, but making it meaningful is very difficult with a bureaucracy practiced at rubing and undermining oversight committees. SFPUC has $4.6 billion to spend. Who wants a watchdog? Now, a lapdog, that’s different.


February 2011

Pensions Unpayable

Among the many facets of San Francisco government, happily one group is composed entirely of volunteers: the Civil Grand Jury.

This past year the Jury reported on public pension liability. Few listened. That is too bad. With no axe to grind, and no turf to protect, these talented citizens are very likely motivated by nothing other than the desire to protect the citizenry of our fair city.

The Grand Jury’s report is disturbing. They often are. Perhaps this is why the Civil Grand Jury is so often ignored.

The Jury tells it like it is. “The purpose of this report is to alert public officials and citizens that fundamental adjustments must be made to the City’s employee pension program.” In five years pension and health care costs will more than double, the Controller says.

The Jury believes that the financial future of San Francisco is in jeopardy. In the past the City has kept its pension fund fully funded. But City’s actuaries project growing unfunded liability in the future.

The Jury listed more than 900 retirees who receive pensions of more than $100,000. Absent reform, pension costs will soar in just a few years.

Cost sharing mandated by 2002 proposition has not been instituted. The People’s will has been ignored by politicians doing the bidding of the employee unions.

Not only are the overly generous City employee pensions like voracious termites eating the home, but also they affect everyday services. Revenues allocated for pensions and benefits soak up available revenue; policy makers choose to cut employees. Take Rec & Park as an example. “Cut costs” the mayor tells this department that delivers services to children and their parents. Does Rec & Park cut the upper managers? Of course not; it closes all the City’s Clubhouses and lays off the Recreation Directors that run them. Then, recently, it sends three very well spoken representatives to a community meeting about one clubhouse (J.P. Murphy, 9th Avenue) to explain why the best option is to lease out the Clubhouse, which was recently renovated at great cost. Those working with kids are gone; those working with words hang on; in the future, public facilities generate revenue.

Without quite saying so, the Civil Grand Jury says the City has been stupid generous. The City has painted itself into a fiscal corner. It will be messy to get out, but the City must act sooner rather later. In this case the “paint” just keeps getting deeper.

Will the citizenry mobilize? Without plenty of pressure, politicians are unlikely to act. It is like playing with a loaded gun to defy the public employee unions in this town. Public Defender Jeff Adachi tried, and B-B-B bombed. Citizens can heed the Jury’s warning, applying the needed pressure, or the City can “go Vallejo”.

The Jury is out.

December 2010

Water and Sewer Bills Set to Escalate

Nov. 2002 • Proposition A

(from Ballot Handbook)

Controller’s Statement on “A”

City Controller Edward Harrington has issued the following statement on the fiscal impact of Proposition A:

In my opinion, should the proposed bond issue of $1,628,000,000 be authorized and bonds issued at current interest rates, based on a single bond sale and level redemption schedules, the cost would be approximately $85,000,000 annually for thirty (30) years for a total approximate cost including debt service of $2,551,000,000.

This bond amount represents increases ranging between 5% and 12% annually between 2003 and 2015 in water rates for San Francisco consumers, the source of repayment for these bonds.

For the average single family residential service in San Francisco this cost is equivalent to an increase of approximately $26.42 per month above the current rate of $14.43 per month, for a total of $40.85 per month by 2015

(Harrington is currently Executive Director of the SFPUC)

The Supervisors voted as follows:

Yes: Supervisors Ammiano, Daly, Gonzalez, Leno, Maxwell, McGoldrick, Newsom, and Peskin.

No: Supervisors Hall, Sandoval, and Yee.

The rate you pay for water has doubled over the past five years, and will continue to rise. Why is this cost rising at 15% when inflation is much less? What might slow further increases?

Water is billed by the “unit.” A unit is a cubic foot of water, which is about 748 gallons. If you are a typical single family residence you pay $3.09 per unit for your first 75 gallons per day, and your household pays a higher rate if you use more than about 75 gallons per day (averaged over two months). You also pay a fixed monthly charge, and separately, at a higher rate, for sewage. Most water is assumed to end up sewage and you are billed accordingly.

While water use has declined over the past few years, chances are your bill is close to double what it was in 2005. The increase pays for the Water System Improvement Program, which is employing a record number of public employees at the city department responsible for water and wastewater (sewage), SFPUC.

The Water System Improvement Program (WSIP) upgrades the Hetchy water system, which opened in the early 1930s. WSIP aims to make the water system less vulnerable to earthquake and drought, and more maintainable. The program now carries a price tag of over $4.5 billion. The thirteen year program is a bit more than one-quarter accomplished, according to SFPUC, and has a few months over five years to run. Most of the physical work is to be accomplished in the upcoming few years, through 2015. During this time SFPUC is to accomplish about two-thirds of a billion dollars worth of work a year. Even by today’s standards, that is a lot of work; it is far more than SFPUC has ever done before.

So the key to limiting future rate increases to only three or four times the rate of inflation is for SFPUC to bring in the huge amount of construction it is doing within budget. It is a huge challenge. Over one hundred shutdowns must be scheduled and accomplished to allow construction work to be done and to connect up new facilities.

The WSIP program has changed over the years. In 2003, when it began, it cost less: about $3.4 billion. Back then it was to accomplish more. It was to accommodate a growing population, providing more water. A fourth line across the Central Valley was to be built, and the Calaveras Reservoir was to be enlarged to hold more than six times more than it holds.

In 2005 WSIP aims were downsized. Now it aims to accommodate only slightly more water usage. SFPUC has promised to cut water usage in San Francisco and cap demand growth in the suburban areas served with Hetchy water. About two-thirds of the system’s water is wholesaled to suburban customers.

Some of what was cut from WSIP in 2005 will likely be done in the future, driving your water bill up further.

Today’s WSIP is to provide less recycled water, 1.6 mgd (2 possibly) rather than 10 mgd, although at greater cost. WSIP no longer duplicates and replaces some pipelines; instead it repairs portions of lines. Today’s WSIP has added lots of environmental work. A Habitat Reserve project has grown to $54 million, and Watershed Improvement project is expected to cost $20 million. These are over and above the environmental mitigation done by each project.

Recently SFPUC agreed to take less water from local watersheds, giving more to fisheries and waterways. This will cost both in the giving and the replacing.

Large as it is, today’s WSIP, formerly the Capital Improvement Program, is just one program among many being undertaken by a growing SFPUC. The Sewer System Improvement Program is being finalized; the cost has grown from $1 billion in 2003 to probably $5 billion or more today. SFPUC is building a new, very green headquarters building for its employees: cost $190 million. SFPUC will soon sell electricity to households and businesses in San Francisco, competing with PG&E. SFPUC has quite a number of smaller programs, including biodiesel, GoSolar (panels to the people), municipal solar panels throughout the city, Lake Merced (taken over from Parks and Rec), graywater, stormwater, as well as for Treasure Island and Hunters/Candlestick developments. In less than a decade SFPUC’s Communications department has gone from one employee in charge of public outreach to 22.

In 2002 voters essentially gave SFPUC carte blanche to spend on infrastructure. Eight years later the results are that SFPUC has expanded, and with it your bills, too.


November 2010

What does the City Spend?

San Francisco spends about $8200 per resident per year. That is far more than the state spends on your behalf, and nearly what the federal government does.

Total City spending per year is over $6.5 billion. That includes what is spent currently for benefits for retirees, but it does not include all that will need to be spent on those now working who will retire with pensions and life-time medical benefits. Also, the figure does not include schools and teachers.

Half of what San Francisco spends goes to personnel — to the salaries and benefits of public employees and retirees. In San Francisco public employees make more than private employees do. They also receive better benefits, have a more secure job, and, probably, enjoy better working conditions with fewer demands.

During good times public employment expands. Politicians respond to demands of constituents, special interests, and unions of public employees to do and hire more. When the hard times come it is difficult to eliminate public employees; all possible steps are taken to avoid painful layoffs. This means that public employment tends to ratchet upward.

In good times and lean it is tempting to promise future benefits which do not come from current funds. Benefits ratchet up. For example, city retirees receive life-time medical benefits. How many private employers offer that?

Politicians shy from stopping the rise in public employment and its cost. It can be political suicide to defy unions of public employees, which control so much money and so many campaigners. It would be risky to defy special interests who demand more services, especially during good times, when most voters turn their attention to making their own hay while the sun shines.

How might the ratcheting up of city employment and spending be controlled? Perhaps the City Charter should limit public employment to some number per resident. Now there is on the order of one public employee for every twenty-eight residents, far more than in most cities across the nation. Perhaps this ratio should increase to no more than one City employee for each 35 residents. Compensation, too, might be limited to a percentage (perhaps 110%) of what is earned by the median private employee in the City. That way those working for the public would not be far richer than those who support them. But at present there is no movement in the direction of such a Charter amendment.

Apart from paying salaries to City workers and benefits to retirees, how does the City spend its annual budget? Professional and contract services account for more than one-third of what does not go to present and retired City employees, so the City also spends large on independent contractors. Aid and grants consume about 9.4% of what the City spends; the City pays outsiders to do good works. Debt service consumes almost 10% of spending, and this percentage will rise.

Where does the City get its funds? Property taxes provide one-fifth. Charges for services bring in one-third. One dollar in six is from the State or Feds. Payroll taxes, business taxes and fees, hotel room tax, and quite a number and variety of other sources bring in smaller sums of the more than six billion dollars needed to feed the hungry beast that is City government.

Does the City spend too much? This fiscal year’s deficit is $483 million; next year’s is projected to be $712 million. MUNI routinely collects about two dollars per five that it spends, yet no one proposes to increase the fare to five bucks. It is expensive to run a special City.

One City expense that is running wild is pension costs. Recently the Civil Grand Jury, which is a group of volunteer citizens, reported on how the City’s pension expense is unsustainable. “The purpose of this report is to alert public officials and citizens that fundamental adjustments must be made to the City’s employee pension program.” In five years pension and health care costs will more than double, the Controller says. The Civil Grand Jury believes that the financial future of San Francisco is in jeopardy. Will citizens act in time?


October 2010

Water Bills and WSIP

On July 1 the rate charged for water rose about 15%. Rates have doubled over the past five years.

There are two rates, called tiers. For the first six “units” of water (about 4488 gallons) used in each two month billing period, the homeowner pays $3.09 per unit. For more than 4488 gallons the homeowner pays $4.12 per unit. So on average the first 75 gallons a day are charged at a lower rate. It does not matter if a household is one person or a family of ten. Each customer (meter) also pays a flat charge, usually $12.40 for two months.

Renters and some condo owners share a water meter. Then rent or homeowner association fees pay for water. Different rates apply: $3.28 per unit for lower tier, and $4.37 for higher tier usage. Rent or monthly dues will tend to go up, as water must be paid for.

Wastewater rates are higher than those for water. The charge for wastewater (sewage) depends on your water usage. It is assumed that most of what you use in water goes down the drain and into the sewer system.

Why are water rates going up faster than inflation? Because of “WSIP”, the Water System Improvement Program, a 13-year program upgrading the water system and making it more reliable and less vulnerable to earthquake and drought, says San Francisco Public Utility Commission (SFPUC).

WSIP’s cost is now expected to be more than $4.5 billion. In its eighth year, the program is just over a quarter completed, reports SFPUC. In the upcoming five years, the balance of the program, about $3 billion dollars worth, is to be accomplished. But to date no WSIP schedule has held.

The program was launched in 2003 with a $3.4 billion price tag. More than seven years later, there remains about the same amount yet to be spent on improvements.

At the outset of the WSIP work, water rates were expected to triple. Now it is uncertain where they will end up.

In 2002 wastewater (sewer) work was removed from the capital program now known as WSIP. At that time that sewer work was priced at one billion dollars. While the sewer improvement program is still being finalized, the price has risen to about five billion dollars for the Sewer System Improvement Program.

More than half of WSIP’s work is encompassed in five giant projects. There are over eighty projects in all. Of the five giant projects, one is now in construction; one is awarded and construction work should begin soon; three have yet to go out for bids. Three of these five giant projects are to be completed in 2015, the program’s final year. Further delays to these giant projects may push the program past its deadline, and could further increase the program’s cost.

The real deadline is in the hands of God. No one knows when the next big earthquake will strike, nor on which fault. If WSIP work is completed, our water system should stand a good chance of surviving.

Steve Lawrence is a PUC citizen activist.

The next regular Meeting of the San Francisco Public Utilities Commission is scheduled for Tuesday, September 14, 2010, in Room 400, City Hall beginning at 1:30 P.M. For information, contact the Commission Secretary at 554-3165.

The next meeting of the SFPUC Citizens’ Advisory Committee, will take place on Tuesday, September 28, 2010 at 5:30 p.m. at 1155 Market St., 4th Floor Conference Room.

Minutes and other information are available:

Sept. 2010

What’s Happening with Community Choice Aggregation?

City government is getting into the business of providing electric power to San Francisco households and businesses. Under a law passed shortly after the energy crisis, cities may organize a company to compete with PG&E. Although the energy crisis waned, Greens joined long-time public power advocates, like the Bay Guardian and other “progressives” to push “power to the people!” Greens hope that community choice aggregation will bring greener power.

The vehicle for selling competing, greener power is called Community Choice Aggregation, or CCA. San Francisco is organizing its CCA, called CleanPowerSF. Once organized, CleanPowerSF will notify all households that receive a bill for electricity that they are joining the CCA, unless the household opts out. For three years the city CCA will sell power for the same price as PG&E sells it. The CCA power will come over the same grid, PG&E’s grid, as it does today. It just is to be “greener” power.

How much greener? Not too much. PG&E’s power is currently about 15% from renewable sources like wind mills. The CCA’s power will start off at 24% from renewable sources. In the second year that will rise to 25%, and in the third year to 26%. By the tenth year it is supposed to rise to 51%.

However, all details are in doubt. The City, on behalf of the CCA it will organize, negotiated these details with PowerChoice LLC, a private company that was to have acted as the CCA’s agent. Recently, however, negotiations with PowerChoice have terminated. A new request for proposals will go out in July, it is hoped. Meanwhile, doubt is cast on all the details of what was to have happened had the PowerChoice deal not fallen apart.

How was the City CCA to sell electric power as cheaply as PG&E for the first three years? It was to have gone into debt. The City CCA would borrow up to $400 million, which will be paid off between years 4 and 15.

If a household were to fail to opt out at the outset, could it do so later? Yes, but it must give six months notice, and it will cost. How much it would cost would be decided by rate-making authorities.

Would the City CCA really provide 51% renewable power in ten years? That was the target. Until recently the target had been by 2017. The percentage would include not only clean power provided, but also power conserved.

Why is the term “clean power” used, rather than “renewable power?” Renewable has a defined meaning; it excludes electricity generated by “big hydro”, as from the Hetch Hetchy dam and system. “Clean” is a term that might include power from big dams.

As part of the CCA program the City will acquire new power generation facilities. For example, it will demand that developers build wind mills or place solar panels and dedicate them to the City so that the City CCA owns generation facilities. While at first green power will be purchased on the open market, as time passes more and more is to be generated by city-owned facilities. Other generation being explored includes ocean and small hydro. Efficiency programs that reduce demand for electricity are also being aggressively pursued. Reducing power usage will count towards meeting renewable or clean targets.

To purchase green power the City CCA will engage a private agent or broker to buy power, and to service accounts.

Failed Prop 16, on the ballot in early June, might have made it more difficult for the City to organize its CCA. Had the proposition passed, cities were not to spend money organizing a CCA unless two-thirds of voters authorized it.

Recent review of the calendar of the General Manager of the SFPUC, the City department doing CCA, reveals that he is spending perhaps one-quarter to one-third of his time on the matter. With a $4.6 billion Water Improvement Program, a perhaps $4 billion wastewater program, and a new headquarters building also on the table, one might question the wisdom of expanding into public power just now.

Steve Lawrence is a PUC citizen activist.

July 2010

Community Choice Aggregation (CCAs)

pro & con graphic

Coming To A Socket Near You

Is Dirty Energy Good Enough For You?

Did you know that the electricity that PG&E is delivering to residents and businesses in San Francisco is only 15% renewable and won’t meet the state’s 2010 goals for clean, renewable energy? Let me reiterate that point. It’s 2010 and the energy to power our homes and businesses is only 15% renewable.

CleanPowerSF is a simple solution to our dirty energy problem. CleanPowerSF’s goals are to deliver San Franciscans cleaner, more renewable energy that meets our state’s requirements. The program will rely on more renewable resources like solar and wind energy and aims to be 51% renewable by 2017.

Today, most energy customers must get their energy from PG&E; there is no choice in the matter. PG&E generates your electricity from nuclear, coal, natural gas, hydroelectric and other energy sources. PG&E then transmits and distributes this energy directly to San Francisco homes and businesses.

CleanPowerSF will change only the “generation” part of this equation by providing customers with energy from resources like solar and wind energy. And that’s it. PG&E will continue to transmit and distribute electricity directly to residences and businesses and provide billing services. If you have an electrical outage, customers will still call PG&E and they will still be responsible. The only difference will be the type of energy you are receiving; it’s going to be much cleaner.

With CleanPowerSF, energy customers finally get a choice. Instead of one energy supplier, residents and businesses will have a choice between two energy supplies and mixtures

“Participation in CleanPowerSF is also easy and completely voluntary. Do nothing and you will receive cleaner energy; it’s that simple. Energy customers who wish to remain with PG&E’s energy supply may opt-out of CleanPowerSF at any time. At the beginning of the program, CleanPowerSF will send out a total of four opt-out notices both before energy service begins and after the energy changeover.”

(CleanPowerSF’s clean energy or PG&E’s energy). Ultimately, the choice is yours; consumers benefit by finally having a real and meaningful choice in their electric energy supply. CleanPowerSF will put you in the driver’s seat of your energy needs. We hope you will consider choosing the energy provider that offers the most stable rates and the cleanest, most renewable energy.

Participation in CleanPowerSF is also easy and completely voluntary. Do nothing and you will receive cleaner energy; it’s that simple. Energy customers who wish to remain with PG&E’s energy supply may opt-out of CleanPowerSF at any time. At the beginning of the program, CleanPowerSF will send out a total of four opt-out notices both before energy service begins and after the energy changeover.

Contrary to claims by opponents, CleanPowerSF will not cost the City taxpayers anything. CleanPowerSF will be funded entirely by participating ratepayers. In fact, with more renewable energy pouring into San Francisco’s electrical grid, energy prices will be much more stable over the long-term and less subject to the wild price fluctuations of fossil-fuel energy sources. CleanPowerSF’s goal is to have rates that are competitive with PG&E, while significantly increasing the amount of green energy supplied to the San Francisco electrical grid.

Right now, the California Public Utilities Commission (CPUC) has certified the CleanPowerSF implementation plan. The SFPUC will also shortly sign a service agreement with PG&E in order to facilitate smooth program operations. Finally, once the SFPUC completes a draft contract with the energy service provider (the entity that provides the City with the cleaner energy) the SFPUC will present it for full public consideration by your elected officials. As is the City’s standard practice, your elected officials will seek the advice of both the City’s Budget Analyst’s Office and City Controller. The Board of Supervisors, the Rate Fairness Board, the SFPUC Commission and the Local Agency Formation Commission (LAFCo) have held numerous hearings on the program already and will also hold public hearings on the contract. Once the legislative approval and transparent public review process concludes, shortly thereafter the City will begin finalizing the contract.

When CleanPowerSF begins serving energy customers, San Franciscans will see no change when they flip on a light switch or plug in their appliances. PG&E will continue to own and operate the electrical grid in the city and provide billing services for customers. However, CleanPowerSF will provide consumers with two things that PG&E currently lacks —long-term rate stability and a cleaner energy portfolio. CleanPowerSF is the best opportunity for our City to reduce greenhouse gas emissions and make San Francisco a greener, cleaner place to live and work.

Michael Campbell is the CleanPowerSF Director

June 2010



Is CleanPowerSF For You?

From the San Francisco Public Utilities Commission homeowners have received a mailer promoting CleanPowerSF: “I Choose Clean Energy.” The mailer promises that if the homeowner does nothing then he or she will receive energy that is “much cleaner than the energy currently provided by PG&E.”

Sound too good to be true? What is really going on here?

CleanPowerSF is San Francisco’s knife to stick into the back of PG&E. Elements within the City despise PG&E. Those who have ever read the Bay Guardian have probably seen it rant against PG&E and for public power. Also, “progressive” Supervisors love to hate PG&E.

In 2002, in the aftermath of the energy crisis, a state law passed allowing local agencies to form entities competing with the current electric lutilities such as PG&E. The price of electricity had spiked after companies like Enron had gamed the deregulation system of the mid-Nineties. California found power scarce, and prices multiplied. PG&E went into bankruptcy. To legislators it looked like backup was needed. The 2002 law resulted.

Then the crisis abated.

Still, among those who despise PG&E and had long called for “public power” the 2002 enabling law was tempting. It allows “community choice aggregators” to organize, and to sell electric power in competition with the utility that had long had a monopoly (for good reasons widely accepted across the country). As environmentalists advocated for more renewable power generation, two forces combined: environmentalists and those who want public power. The result in SF is CleanPowerSF. Marin, too, has moved to create a competing public provider of electric power.

“San Francisco is scampering to beat the deadline by organizing and registering its competing company before June 8. The San Francisco Public Utilities Commission, the city department providing water, sewer, and power for public places, is carrying the ball.”

As San Francisco and Marin marshaled forces and support, PG&E decided to fight back to protect its turf–with Prop 16 on the June 8 ballot. Faced with the Prop 16 threat, which would require a two-thirds vote to spend public funds to create a competing public power provider, San Francisco is scampering to beat the deadline by organizing and registering its competing company before June 8. The San Francisco Public Utilities Commission, the city department providing water, sewer, and power for public places, is carrying the ball.

Lately the Commission authorized its general manager to enter into a contract necessary accomplish a competing electric power provider by June 8. Usually the Commission accepts contracts – with all terms and conditions written. But, given the urgency it was willing to perhaps play fast and loose with the law, and certainly with custom.

You the customer must act to reject CleanPowerSF, or otherwise you will be deemed to have accepted it as your new provider of electricity. If this strikes you as cheeky, well, you are beginning to get an education about how theses lefties work. The notice to you announcing your “choice” of CleanPowerSF as service provider unless you reject it has not gone out yet; that comes in the future. The recent mailer is just “outreach”. (Of course sent at ratepayer expense.)

You the consumer of electric power might ask a few questions (but don’t hold your breath awaiting answers).

Question one: will CleanPowerSF cost me more? Ah, that is one matter that is touched on only very lightly in the “outreach” mailer. “Your rates will be comparable,” the mailer says. What is “comparable”? The dictionary defines it as “worthy of comparison.” Is ten percent higher than PG&E rates worthy of comparison? Twenty percent? Fifty percent? No one knows.

Question two: much cleaner? CleanPowerSF promises to deliver electricity “that is much cleaner than the energy currently provided by PG&E.” Really? Does it have any track record? (No.) Does it have contracts with significant providers of solar power? (None known or mentioned.) With wind power providers? (Same.) With “other” renewable sources? (None mentioned; and what would they be?)

Question three: reliability. CleanPowerSF promises that “It’s Reliable;” there will be no difference in reliability. Really? Suppose you provide a service to a set of customers and they banded together to dump on you and deprive you of business; would your service continue to be as reliable? If so, you must be a saint.

When something looks too good to be true.... The City is spending public funds to stick a knife into PG&E. This will gratify PG&E haters. Greens will take some pleasure: Because of competition, PG&E will be less likely to meet renewable mandates, and then greens will then be able to beat up PG&E. Feels good. Meanwhile, the City will pay to organize a competing electricity provider, will send “outreach” and employ bureaucracy, and will engage in political theater. Well, what else is new?

Steve Lawrence is a PUC citizen activist.

June 2010

Will the City Have Enough Water?steve lawrence photo

During an El Nino winter it is perhaps an odd time to ask whether San Francisco will have enough water in the future. Yet the question needs to be asked.

During the past eighteen months developments, when considered together, suggest that serious water shortages may occur.

In Fall 2008 the technical-sounding Phased WSIP Variant was adopted by the City. This limits the City's Hetchy water system to selling no more than 265 million gallons of water per day on an average annual basis. As this is about the quantity of water our the water system now sells, the limitation essentially says that we will not permit demand for surface (river) water to grow. Instead, the City has agreed to develop recycled and groundwater sources, and to conserve more aggressively than it has in the past.

Then last Spring the City made a new agreement with its suburban water customers. While the City owns the Hetchy water system, long ago it agreed to serve customers upstream and along, or near to, its water lines. Indeed, these suburban customers take more than two-thirds of the system's water. This past Spring the City assured these customers that they could take about 190 million gallons per day (mgd) of the 265 mgd the water system is limited to selling. The balance remaining to be sold to users in the City is about 75 mgd.

Demand for water in the City exceeds 75 mgd. Also, the City is growing. Candlestick Point - Hunters Point is to develop 10,500 units of housing; Treasure Island is about to build thousands of units; Park Merced is upsizing by 5700 units; and very possibly the Octavia corridor will add thousands of housing units as well. These are only the large developments; there are many smaller ones. Population in the City is growing and growth is expected to accelerate. This means more people to serve, and more property to protect after an earthquake.

While demand for water has been declining in the City, due to more efficient appliances and a felt need to use water wisely, the declines are considered unlikely to continue. San Francisco's population is aging as well as growing.

To bridge the gap between expected demand and available water supply, the City is developing groundwater and recycled water sources. Recycled water will be used for irrigating, for example in Golden Gate Park where groundwater is now used. That will free up groundwater, which will then supplement the drinking water we get from the Hetchy system.

But there are questions about groundwater. At a meeting held Wednesday January 20, questions about the quality of groundwater, and about whether the City could develop it quickly enough and in sufficient quantities arose. Officials did not say, as they had in the past, that groundwater would be blended so that it makes up only a small percentage of the drinking water of those served by Sunset Reservoir. Also, officials asserted broadly that groundwater was safe, that it would not be blended for health—but would only be blended for taste. Despite these assertions, some fear that groundwater contains troublesome concentrations of manganese, or of pharmaceuticals for which there are not yet state and federal requirements. Questions also arose about whether the groundwater aquifer (underground reservoir) would recharge sufficiently so that in the long wells will not run dry.

Should groundwater not pan out as hoped, questions remain about whether and how the City can make do with 75 mgd of water. Already San Franciscans use less water per person than anywhere else in the country.

So as the El Nino rain falls, let us hope it lasts. Lastly, let us hope that the City has sufficient water not only for ordinary times, but also for a disaster. After all, it was only after the big 1906 quake that it came to be recognized that the City needed to develop a larger, more reliable water supply.

Steve Lawrence is a Westside resident and is a stalwart defender of the public purse at SF Public Utility Commission meetings. Feedback:

February 2010