PUC kicks off biennial budget process and flags workforce shortfalls and succession risks

The San Francisco Public Utilities Commission on Tuesday began a months‑long budget process that staff said will include four January workshops, discussion of a biennial operating budget, and a 10‑year capital plan that feeds the city’s broader budget calendar.

Eric Sandler, assistant general manager and CFO, said the PUC is developing a two‑year operating budget and a 10‑year capital and financial forecast that are charter requirements. He said the PUC initiated internal budget work this summer and will present proposals to the commission in January and seek adoption in February before the mayor’s office and Board of Supervisors review.

Sandler and other managers told commissioners they are factoring in external pressures — rising construction costs, potential economic slowdown, and falling water and power sales — and internal constraints including limited contracting and project‑management capacity. Staff highlighted workforce challenges: many long‑tenured employees (hired around the 1970s Clean Water Act era) are nearing retirement, creating a recruitment and succession planning need that outpaces current HR capacity. Options discussed included creating permanent HR positions, using 'ghost' hires to overlap retirements, apprenticeship partnerships with unions, and substituting positions within existing FTE caps.

Commissioners pressed for detail on consequences of delays, the use of contractors versus hiring staff, and apprenticeship program integration. Staff said the budget instructions require efficiency analyses for new resource requests and that temporary project positions may be converted to permanent roles where program permanence is established.