Public Utilities Commission Response
Mr. Harvey Rose
Board of Supervisors Budget Analyst Office
1390 Market Street, Suite 1025
San Francisco, CA 94102
Dear Mr. Rose,
This is the San Francisco Public Utilities Commission's (SFPUC) response to your management audit of the Water Enterprise concluded in March 2005. My staff and I have reviewed the Budget Analyst's recommendations. We have summarized our responses and have provided more specific responses on the pages that follow.
As you know, I have recently reorganized the department along our three enterprises, and new management teams continue to refine our work in Water, Wastewater and Power. I appreciate your assistance as we move forward in strengthening the organization.
Thank you for your analysis and recommendations. I expect that this and the three additional reports will provide useful guidance to the SFPUC.
Sincerely,
Susan Leal
General Manager
1. Suburban Wholesale Water Rates, Long Range Financial Planning, and Revenue Funded Repair and Replacement Projects
Recommendations
The Public Utilities Commission General Manager should:
1.1. Implement the State Department of Finance audit recommendation to provide the Public Utilities Commission and the Board of Supervisors detailed capital repair and replacement program information.
SFPUC response: Agree.
1.2. Provide a report to the Board of Supervisors during the FY 2005-2006 budget review regarding:
(a) The status of all Water Enterprise repair and replacement projects, and the Infrastructure Division's management support of the capital repair and replacement program.
(b) The implementation of the asset management program.
SFPUC response: Agree.
1.3 Develop a formal plan for the ongoing exchange of information between the Infrastructure Division's program management team and the Financial Services Section staff, including regular reporting to the General Manager and the Public Utilities Commission, to ensure that the Commissioners, the General Manager, and senior management staff have adequate information on future revenues and expenditures for Water Enterprise Fund programs.
SFPUC response: Agree.
The Public Utilities Commission should:
1.4 Negotiate with the suburban customers, represented by the Bay Area Water Supply and Conservation Agency, to renegotiate the Settlement Agreement and Master Water Sales Contract at an earlier date to revise the terms of capital cost recovery
SFPUC response: We agree that re-negotiating the capital costs recovery portion of the contract could provide more stable rate adjustment.
2. Calculation of the Suburban Wholesale Water Rates
SFPUC Overall Comments: We disagree strongly with the Budget Analyst's implication that we are inappropriately commingling capital expenses and operating expenses. Though the agency has chosen to expense a number of capital projects, this in no way implies that these are operating expenses. We also disagree that the accounting system is inadequate and does not record appropriate information for capitalization. In addition, we disagree with the claim that the agency is at fault for delays in the suburban compliance audit; it is the auditor who has delayed this process.
Utilities are by nature asset-intensive industries, and the SFPUC's span of asset-related activities is broad. These activities range from asset operations, preventative maintenance, repair, major maintenance, replacement and reconstruction, as well as capital additions and extensions. The distinction between some of these activities is not always clear-cut.
Recommendations
The Public Utilities Commission General Manager should:
2.1 Revise the accounting structure and its use to capture at a summary level critical data and information necessary for the computation of the suburban wholesale water rates.
SFPUC response: While we agree that capturing critical data is important, we do not agree that this is an accounting structure issue.
2.2 In coordination with the Bay Area Water Supply and Conservation Agency, determine alternative measures to comply with the 2004 settlement agreement requirement to obtain technical recommendations from an independent source on the suburban wholesale water rate calculation.
SFPUC response: We understand that the role of compliance auditor is in conflict with the settlement agreement provision.
2.3 Provide quarterly written status reports to the Bay Area Water Supply and Conservation Agency on the three remaining process improvement areas: the Enterprise Asset Management System, technical improvements as recommended by an independent source, and bid specifications.
SFPUC response: We are working to strengthen our current asset management program into a more comprehensive system that will address these issues.
2.4 Work with the Controller's Office to engage an alternative independent auditor for the audit of the balancing account and the suburban revenue requirement calculation.
SFPUC response: Agree.
2.5 Work with the independent auditor to comply with the independent audit timelines set forth in the Settlement Agreement and Master Water Sales Contract and transmit completed audits in a timely manner to the Bay Area Water Supply and Conservation Agency.
SFPUC response: While we agree with the recommendation to transmit completed audits promptly to the Bay Area Water Supply and Conservation Agency, we disagree with the cost analysis that this process improvement will be cost-neutral. We think that it will require increased staffing, training and system development, as well as some professional services work.
3. Coordinating and Timing the Financing of the Water System Capital Improvement Program
SFPUC Overall Comments: While we agree that we need to coordinate capital planning, budgeting and financing better, and are working to do so, we are focused primarily on capital planning because that effort will determine so much of our budgeting and financing processes.
Recommendations
The Public Utilities Commission General Manager should:
3.1 Develop a formal coordinating team within the Public Utilities Commission, in which the Infrastructure Division and the Financial Services Section coordinate capital program and financial planning for the Water System Capital Improvement Program, including:
(a) Regular and frequent disclosure of information from the Infrastructure Division on the planning and timing of construction of the Water System Capital Improvement Program projects, and
(b) Regular reports to the General Manager on the status of Water System Capital Improvement Program projects, current revenue requirement forecasts, estimated suburban and wholesale water rate increases to meet these requirements, and debt financing plans.
SFPUC response: We are working to improve our coordination and planning.
3.2 Report monthly to the Public Utilities Commission and quarterly to the Board of Supervisors on the status of the Water System Capital Improvement Program, the plan to finance the capital projects, and the current long range financial projections, including:
(a) The summary of the Infrastructure Division and Financial Services Section's coordination of planning and implementing construction projects and the timing of debt issuance, and
(b) The impact of Water System Capital Improvement Program project planning and implementation on projected revenues and the Public Utilities Commissions financial targets.
SFPUC response: We agree that regular reports would be valuable, but monthly and quarterly reports will not be helpful due to the pace of construction projects. We will report semi-annually, with possible consideration of quarterly reports as well.
4. Undercharging for Components of Water and Sewer Service
Recommendations
The Public Utilities Commission should:
4.1 Terminate the Water Conservation Affidavit program in FY 2006-2007.
SFPUC response: Agree.
4.2 Direct the Director of Financial Services to present a financial analysis on the costs and benefits of implementing water conservation rates in FY 2006-2007.
SFPUC response: Agree.
4.3 Direct the Customer Services Water Conservation Unit to develop and present to the Public Utilities Commission and the Board of Supervisors a water conservation program for City General Fund departments that includes budgetary incentives, such as a water charge for consumption over a baseline amount.
SFPUC response: Agree.
4.4 Adopt a resolution, (a) establishing baseline water use for the neighborhood and homeowners' associations, based on drought-tolerant plantings, and (b) setting up special assessment districts for neighborhood and homeowners' associations to charge for water use that exceeds baseline use.
SFPUC response: Agree.
The Assistant General Manager, Water, should:
4.5 Develop and present to the Public Utilities Commission, as part of the annual budget review, a cost analysis of the meter replacement program, including:
(a) the number of meters replaced during the fiscal year,
(b) the cost of replacing meters and the number of meters to be replaced in the coming fiscal year,
(c) the projected number of meters that will be replaced over the ten-year period, and
(d) the projected cost of replacing meters over the ten-year period compared to the expected impact on meter reading accuracy and revenues.
SFPUC response: Agree.
The Assistant General Manager, Clean Water, should:
4.6 Direct the Manager of Wastewater Collection System Bureau to review the flow factor assignment of all commercial and industrial accounts that have not been reviewed for four years or more prior to September 30, 2005, and provide a report on the flow factor review and assignment to the Assistant General Manager, Clean Water.
SFPUC response: While we agree that most of these accounts have not been re-inspected in the last four years, we do not necessarily agree with the $70,000 estimated loss. The report noted that the Bureau of Environmental Regulation and Management appropriately assigns and documents reduced flow factors. Accounts that have not been recently re-inspected will all be re-inspected and adjusted if appropriate.
The Customer Services Manager should:
4.7 Resume a schedule for review of all residential accounts at least every four years that have been assigned a flow factor less than 70 percent.
SFPUC response: Agree.
4.8 Enforce the division's policy to review all accounts with a reduced flow factor within a four year cycle.
SFPUC response: Agree.
4.9 Establish more rigorous policies for reducing residential flow factors, including requiring:
(a) documentation on the presence of low flush toilets and number of occupants, and
(b) requiring supervisor review for all accounts in which the flow factor calculations vary by more than 10 percentage points between the calculation of wet and dry months' water consumption and maximum irrigation potential.
SFPUC response: Agree, we already require supervisor review for all accounts in which the flow factor calculation results in a 50% or less flow factor.
5. Accounting for the Costs of Water Quality Bureau Laboratory Services.
Recommendations
The Public Utilities Commission General Manager should:
5.1 Assign Financial Services Section staff to work with the Water Quality Bureau Laboratories managers to develop a system of allocating laboratory costs and establishing a price list.
SFPUC response: Agree but it will only be a price list for a specific list of analyses. The list of constituents will be developed by the Water Quality Bureau Manager and will include at a minimum those constituents being requested by external customers. The list of constituents will be submitted for approval to the Assistant General, Water. The proposed cost-based fees will not cover field surveys, report production and operational support.
5.2 Direct the Water Quality Bureau Manager to establish cost-based fees for internal and external clients.
SFPUC response: Agree, but with the scope as outlined above.
5.3 Report to the Public Utilities Commission and the Board of Supervisors on the cost allocation system, including a proposed price list for internal and external clients, prior to September 30, 2005.
SFPUC response: Agree, but with the scope as outlined in response to 5.1.
The Water Quality Bureau Manager should:
5.4 Expand the client services job description to include (a) project management to develop and maintain the laboratory cost allocation and pricing program and (b) gatekeeper functions for internal and external clients to ensure that the appropriate level of laboratory services are provided to achieve clients' analytical goals.
SFPUC response: Agree; already done.
6. The Laboratories' Management Structure
SFPUC Overall Comments: We are in the process of reorganizing, and the Assistant General Managers for Water and Wastewater are reviewing best options for allocation of resources within the new enterprise structures. Any move now would be premature without our having more solid cost and staffing analyses.
Recommendations
The Public Utilities Commission General Manager should:
6.1 Transfer executive management responsibility for the Southeast and Oceanside Water Pollution Control Plant Laboratories to the new Assistant General Manager, Clean Water position.
SFPUC response: Disagree. Until we complete an analysis of laboratory functions, services and associated cost recovery, we do not see the advantages of laboratory separation. Current utility practice when an agency provides both water and wastewater services is to have a single laboratory (i.e. East Bay MUD).
6.2 Eliminate the 1.00 FTE Classification 5133 Program Manager II, Director of Laboratories, position.
SFPUC response: Disagree.
6.3 Transfer 2.00 FTE administrative support positions from the Water Quality Bureau to the Southeast and Oceanside Water Pollution Control Plant Laboratories.
SFPUC response: Disagree.
6.4 Direct the Water Quality Bureau Manager and the new Assistant General Manager, Clean Water to develop contracts or work orders between their laboratories to ensure the continued rationalization of technical and support services and prompt service reprioritization in emergencies.
SFPUC response: Disagree.
6.5 Resolve in FY 2004-2005 whether or not there is sufficient business justification to continue operating a laboratory at Treasure Island.
SFPUC response: Agree.
7. Managing Regulatory Compliance
Recommendations
The Public Utilities Commission General Manager should:
7.1 Direct the Assistant General Manager, Clean Water and the Assistant General Manager, Water and Power to provide quarterly reports to the General Manager and annual reports to the Public Utilities Commission and the Board of Supervisors, which include:
(a) Overall compliance with clean water and drinking water regulations, delineating only areas of noncompliance.
(b) Potential regulatory risks and how such risks are addressed.
(c) Planning for future regulatory requirements and participating in the Federal and State rule making processes.
SFPUC response: Agree, this is underway.
7.2 Consolidate regulatory compliance and planning functions within the Clean Water Enterprise and the Water Enterprise, under their respective Assistant General Managers' directions, including:
(a) The Planning Bureau's clean water regulatory planning and management position should be transferred to the Clean Water Enterprise, as recommended in the Phase I management audit report.
(b) The Bureau of Environmental Regulation and Management clean water regulatory positions should be transferred to the Clean Water Enterprise, as recommended in the Phase I management audit report.
(c) The Bureau of Environmental Regulation and Management drinking water positions should be transferred to the Water Enterprise, as recommended in Section 9 of this report.
SFPUC response: Agree, this is underway. The wastewater regulatory planning and management position has been transferred to the Wastewater Enterprise.
7.3 Direct the Assistant General Manager, Clean Water and the Assistant General Manager, Power and Water to address the current and evolving Federal and State regulatory requirements in their business plans to ensure that current regulatory requirements are met and that future regulatory requirements can be met with existing or planned resources.
SFPUC response: Agree.
7.4 Include regulatory planning in the strategic planning process, to ensure that the Public Utilities Commission is participating in Federal and State rule-making processes and planning for the changing regulatory environment.
SFPUC response: Agree.
7.5 Direct the Assistant General Manager, Clean Water, and the Assistant General Manager, Water and Power, to provide status reports on the coordination of regulatory planning and capital project design and management as part of the Water System and Clean Water Capital Improvement Programs' monthly updates.
SFPUC response: Agree, we already do this to a great extent.
8. The Public Utilities Commission's Risks for Managing Treasure Island Utilities
SFPUC Overall Comments: We do not agree with the Budget Analyst's assertion that our planning process was insufficient. We understand our financial risks thoroughly, and we have made assessments. The Utility Vulnerability and Risk Assessment report (RMC, March 2004) proposed that "TIDA provide the SFPUC with outside funding separate from rate income to cover capital improvement projects and preventive maintenance costs that cannot be covered by revenue until the new systems are built."
As the Budget Analyst notes, the Public Utilities Commission faces significant future risks-financial, regulatory and operational-if we assume responsibility for the decrepit infrastructure at Treasure Island. The services we currently provide are not compensated, and we welcome the opportunity to develop a realistic plan for the future in conjunction with the Mayor's Office and the Board of Supervisors that will include a cost plan and funding sources.
Recommendations
The Mayor's Budget Office should:
8.1. Include funds in the Mayor's Recommended FY 2005-2006 Treasure Island Development Authority budget to pay utility costs, including a schedule to pay the past due balance.
SFPUC response: Agree.
The Board of Supervisors should:
8.2. Request the Public Utilities Commission, through the General Manager, to present a report concurrently with the Mayor's Office presentation of the proposed Treasure Island and Yerba Buena Island development agreement term sheet, expected in the summer of 2005, on the Public Utilities Commission's assessment of the financial, regulatory, design and operating risks to the Public Utilities Commission and how these risks will be addressed in the development agreement.
SFPUC response: Agree.
8.3. Request a joint financial analysis from the Treasure Island Development Authority and the Public Utilities Commission, through the General Manager, in December, 2006, evaluating how the proposed development of the Treasure Island and Yerba Buena Island utilities system will best meet the financial interests of the City and the City's utility ratepayers.
SFPUC response: Agree.
The Public Utilities Commission should:
8.4. Direct the General Manager to present a report to the Public Utilities Commission prior to December 31, 2005, which includes:
(c) an annual cost plan for operating and maintaining the Treasure Island and Yerba Buena Island utilities during the interim period after the U.S. Navy conveys Treasure Island and Yerba Buena Island to the City and prior to construction of the backbone of a new utilities system; and
(d) proposed alternative funding sources to pay for anticipated capital repair costs to the existing utilities of an estimated $5.7 million, including approximately $2.8 million for high priority capital repairs and $2.9 million for preventive maintenance for a four-year period (equal to $720,000 per year).
SFPUC response: Agree.
8.5. Direct the General Manager to negotiate and enter into a Memorandum of Understanding between the Public Utilities Commission and the Treasure Island Development Authority for the operation of the Treasure Island and Yerba Buena Island utilities if the Public Utilities Commission operates the utilities during the interim period.
SFPUC response: Agree.
9. Streamline the Former Bureau of Environmental Regulation and Management Functions
SFPUC Overall Comments: In our recent reorganization, the Bureau of Environmental Regulation and Management, minus the Health and Safety program, was moved under the Assistant General Manager, Wastewater. The AGM plans to combine the Sewer Operations with the BERM staff under the BERM manager. The new combined Collection System organization, which reports directly to the AGM, is substantially larger than the previous BERM Organization. Health and Safety was moved to Human Resource Services. Given this new structure, we do not agree that position reductions are warranted.
Recommendations
The Public Utilities Commission General Manager should:
9.1 Transfer management responsibility for the 3.00 FTE Classification 5620 Regulatory Specialist positions in the Environmental Compliance Program to water and clean water system operations according to assessed need.
SFPUC response: Agree.
9.2 Eliminate the 1.00 FTE Classification 5174 Administrative Engineer position.
SFPUC response: Disagree.
9.3 Eliminate the 1.00 FTE Classification 5138 Program Manager I, Environmental Compliance Program, position.
SFPUC response: Disagree.
9.4 Eliminate a 1.00 FTE Classification 1446 Secretary II position.
SFPUC response: Disagree.
10. Establish an Assistant General Manager, Water and Power Position
Recommendations
The Public Utilities Commission General Manager should:
10.1 Convert the Classification 5166 Assistant General Manager, Operations position into a Classification 5166 Assistant General Manager, Water and Power position.
SFPUC response: Disagree.
10.2 Not upgrade the existing Classification 0941 Manager VI, Director of Power Policy position to any higher classification.
SFPUC response: Disagree.
10.3 Reinstate the reporting line between the Director of Power Policy and the Assistant General Manager, External Relations.
SFPUC response: Disagree.
10.4 Reconsider the need for a separate Assistant General Manager, Retail Power position if the Department becomes a community choice aggregator.
SFPUC response: Disagree.
11. Land Management
Recommendations
The Public Utilities Commission should:
11.1 Adopt a formal policy regarding the identification and sale of surplus property including criteria for when properties may be declared surplus and the conditions, if any, under which the Public Utilities Commission would maintain ownership of property that is not required for the utility.
SFPUC response: Agree.
The Public Utilities Commission General Manager should:
11.2 Establish a formal framework for coordinating the Public Utilities Commission's land use and real property management policies and protocols, including directing the Assistant General Managers for External Affairs, Water, and Infrastructure to jointly coordinate real property and land planning and management, including:
(a) Writing joint protocols for establishing management oversight of:
(i) real property and land inventories,
(ii) surplus property identification,
(iii) property sales and acquisition procedures,
(iv) new lease and permit agreements, and
(v) encroachment identification, management, and removal;
(b) Developing written procedures outlining the decision-making process for the sale of Public Utilities Commission property, which are based on the utilities' land use needs, and are included in the formal property and land use management protocols;
(c) Providing comprehensive written land and property management protocols, including incorporating existing policies and procedures into a single document, to the General Manager prior to July 1, 2005; and
(d) Providing quarterly joint reports to the General Manager on property and land management.
SFPUC response: Agree.
11.3 Formally present Public Utilities Commission real properties and land which are surplus to the water, power, and clean water utilities' requirements, including:
(a) Directing the Assistant General Managers for External Affairs, Water, and Infrastructure to assess the 25 properties, which have been identified by the Real Estate Services Bureau as surplus to the utilities' needs and have not been previously declared surplus by the Public Utilities Commission, to determine which properties should be presented as surplus properties to the Public Utilities Commission; and
(b) Directing the Financial Services Section and the Real Estate Services Bureau to evaluate the potential revenue from the sale of the properties, allocation of such revenues to the Water System Capital Improvement Program projects, impact on the debt financing of such projects, and the impact on future water rate increases.
SFPUC response: Agree.
11.4 Direct the Real Estate Services Bureau to develop and maintain a comprehensive property inventory of the Public Utilities Commission's property holdings, which incorporates the Real Estate Services Bureau database and the Water and Supply and Treatment Division's Geographic Information System information.
SFPUC response: Agree.
11.5 Report to the Board of Supervisors on the existing and projected costs to the City to abate water system rights-of-way management within the next six months.
SFPUC response: Agree.
11.6 Include a status report on the rights-of-way management plan in the Water System Capital Improvement Plan monthly status report.
SFPUC response: Agree.
12. Real Estate Services
Recommendations
The Public Utilities Commission should:
12.1 Delete the final sentence from Section 4.020 of the Commercial Land Management Operating Manual, deleting the provision authorizing the General Manager to implement leases and permits, except for specific leases and permits authorized under Section 4.020, at her discretion without Public Utilities Commission approval.
SFPUC response: Agree.
12.2 Consider adopting a policy that defines the criteria that the Real Estate Services Bureau Director uses when determining if it is appropriate to put a property out to bid.
SFPUC response: Agree.
12.3 Consider adopting a policy that updates and clearly defines the criteria for issuing a permit or entering into a lease agreement for the use of Public Utilities Commission property.
SFPUC response: Agree.
12.4 Consider adopting a policy, requiring Public Utilities Commission approval for all adjustments or other actions that are outside the terms of the existing lease or permit agreement.
SFPUC response: Agree.
The Public Utilities Commission and the Recreation and Parks Commission, in conjunction with the City Attorney's Office should:
12.5 Develop a Memorandum of Understanding for the Lake Merced tract which includes a joint protocol for management oversight and maintenance of the Lake Merced tract.
SFPUC response: Agree.
The General Manager of the Public Utilities Commission should:
12.6 Direct the Real Estate Services Bureau Director to document the analysis of whether there is more than one potential user and present this analysis to the Public Utilities Commission at the time the Public Utilities Commission considers approval of lease agreements.
SFPUC response: Agree.
12.7 Direct the Finance Services Section to work jointly with the Water Supply and Treatment Division to develop a system to track time and material costs to specific tenants.
SFPUC response: Agree.
12.8 Direct the Real Estate Services Bureau, in coordination with the City Attorney's Office, to determine the extent and source of the contamination at 3911 Quint Street, and recover the costs attributable to All Auto Dismantler.
SFPUC response: Agree.
12.9 Direct Real Estate Services Bureau to review all agreements entered into prior to 1999 to evaluate whether the insurance requirements, environmental protection language, and use restrictions included in these contracts are adequate.
SFPUC response: Agree.
The Assistant General Manager, External Affairs, should:
12.10 Ensure that the Public Utilities Commission approves all lease agreements for real property that is surplus or may be declared surplus prior to the Real Estate Services Bureau entering into a lease agreement.
SFPUC response: Agree.
12.11 Direct the Real Estate Services Bureau Director to:
(a) adjust rents and conduct appraisals in accordance with lease agreements,
(b) charge tenants for taxes and assessments uniformly, and
(c) provide monthly reports to the Assistant General Manager, External Affairs, on the status of all leases.
SFPUC response: Agree.
The Real Estate Services Bureau Director should:
12.12 Develop procedures to routinely update the inventory of property for lease.
SFPUC response: Agree.
12.13 Document the Real Estate Services Bureau's marketing and leasing activities for properties available for lease, including providing a monthly report to the General Manager on the Real Estate Services Bureau's marketing and leasing activities.
SFPUC response: Agree.
12.14 Maintain documentation in the lease and permit files on the Real Estate Services Bureau's analysis regarding the number of potential users for specific properties for permits and leases not requiring Public Utilities Commission approval.
SFPUC response: Agree.
12.15 Direct staff to maintain file records of all inquiries regarding properties currently under lease, so that prior to renewing a lease, bids could be solicited from all interested parties.
SFPUC response: Agree.
12.16 In conjunction with the City Attorney's Office, draft a policy to be adopted by the Public Utilities Commission that updates and clearly defines the conditions under which permits and leases should be issued.
SFPUC response: Agree.
12.17 Collect property clean up and other cost information from the Water Supply and Treatment Division, compile the actual costs to monitor and maintain leased property compared to rent revenue, and present this report annually to the General Manager.
SFPUC response: Agree.
12.18 In conjunction with the City Attorney, identify existing leases and permits that do not contain the Public Utilities Commission's insurance, environmental protection, and use restriction provisions, and develop procedures to include the these provisions in these agreements at the earliest opportunity.
SFPUC response: Agree.
12.19 Terminate the lease agreement with All Auto Dismantlers, and evaluate this property to determine if the property is surplus to the clean water utility's requirements.
SFPUC response: Agree.
12.20 Include provisions requiring reimbursement of taxes on the original Mission Valley Quarry Company lease into any new lease agreements with the company.
SFPUC response: Agree.
12.21 Adjust rents, conduct appraisals, and collect taxes in accordance with lease agreements.
SFPUC response: Agree.
12.22 Continue converting permits to leases, when appropriate, and applying the policy defining the conditions under which a permits and leases should be issued for use of Public Utilities Commission property, should the Commission adopt one, as recommended above.
SFPUC response: Agree.
12.23 Review Real Estate Services policies and procedures for inspecting properties and documenting inspections, including reviewing all leases and permits to identify those that are the highest priority for inspection, based on property use, location, or other considerations, and coordinate inspections with the Water Supply and Treatment Division staff who patrol rights-of-ways and maintain watershed property.
SFPUC response: Agree.
12.24 Review the inspection process and revise the inspection documentation form to address specific issues, including if the tenant is following use restrictions, and potential environmental degradation.
SFPUC response: Agree.
13. Water Enterprise Planning and Reporting Deficiencies
Recommendations
The Public Utilities Commission General Manager should:
13.1 Complete a Water Enterprise business plan in FY 2005-2006.
SFPUC response: Agree that a strategic business plan should be developed for the entire water enterprise. This will be initiated upon completion of our staff reorganization.
13.2 Develop an ongoing Water Enterprise business planning process to ensure that the Water Enterprise business plan is regularly updated from FY 2006-2007 onwards.
SFPUC response: Agree. This will be done as part of the Strategic Business Plan development process.
13.3 Direct the new Assistant General Manager, Water and Power (as recommended in Section 10) to review all existing Water Enterprise plans to ensure that there are adequate performance measures and reporting mechanisms to allow the Public Utilities Commission to know that approved management actions have been achieved. The reports to the Public Utilities Commission should include information on when implementation of recommendations or success in meeting recommended performance measures cannot be met because of funding limitations so that the Public Utilities Commission has the option to modify the affected recommendations or performance measures, or fully fund them.
SFPUC response: Agree. This will be done as part of the Strategic Business Plan development process.
13.4 Report to the Public Utilities Commission during FY 2005-2006 on the status of all management actions in all existing Water Enterprise plans.
SFPUC response: This is currently ongoing.
14. Programmatic Environmental Impact Report
Recommendations
The Public Utilities Commission General Manager should:
14.1 Ensure that the planning processes for all future capital improvement programs undertaken by the Public Utilities Commission explicitly include consideration of the need for a programmatic environmental impact report from the outset.
SFPUC response: Agree
14.2 Direct the managers responsible for the Clean Water Master Plan to make a presentation to the Public Utilities Commission on how the Clean Water Master Planning process will determine whether or not a programmatic environmental impact report is necessary.
SFPUC response: Agree.
14.3 Request the Director of the City Planning Department, or representative(s), to participate in the above presentation to the Public Utilities Commission.
SFPUC response: Agree.
14.4 Finalize a memorandum of understanding with the City Planning Department on the operating procedures to be used between the Public Utilities Commission and the Major Environmental Analysis Division.
SFPUC response: We will consider this recommendation.
14.5 Determine, in conjunction with the Director of the City Planning Department, the specific performance measures for a weekly reporting framework for all Major Environmental Analysis Division positions funded by the Public Utilities Commission.
SFPUC response: We will consider this recommendation.
The Board of Supervisors should:
14.6 Request the Planning Commission to direct the City Planning Department's Director to submit a proposal for the Planning Commission's consideration about how the City Planning Department could adopt a more proactive role at the outset of major capital improvement programs to ensure that due consideration is given to the need for a programmatic environmental impact report.
SFPUC response: Agree.
14.7 Request the Planning Commission to report back to the Board of Supervisors on its decisions with regard to the City Planning Department's role at the outset of major capital improvement programs to ensure that due consideration is given to the need for a programmatic environmental impact report.
SFPUC response: Agree.
15. The Need for a Departmental Strategic Plan
Recommendations
The Public Utilities Commission General Manager should:
15.1 Expand the Department's current sustainability plan project to develop an interim Public Utilities Commission strategic plan no later than FY 2006-2007 and a final strategic plan no later than FY 2007-2008 using input from both internal and external stakeholders and maintaining a focus on environmental, organizational, economic, and infrastructure sustainability.
SFPUC response: Agree.
15.2 Regularly update the Public Utilities Commission strategic plan so that it remains a "living document."
SFPUC response: Agree.
15.3 Ensure that the departmental strategic plan is supported by a comprehensive policy, planning, and reporting system.
SFPUC response: Agree.