Community groups, supervisor’s office urge 50% affordable housing at Balboa Reservoir; PUC says land-value constraints limit direct mandates

Public advocates and the office of Supervisor David Campos’ ally told the San Francisco Public Utilities Commission that Balboa Reservoir — a 17.7‑acre publicly owned site — must be structured to maximize affordable housing.

Beth Rubinstein, legislative aide to Supervisor Avalos, said the reservoir is the city’s largest publicly available development parcel and urged the Commission to support the Citizens Advisory Committee’s (CAC) resolution asking the PUC to push for a minimum of 50 percent affordable housing and to consider transfers structured to favor affordability. “As public land, the Balboa Reservoir project should maximize affordable housing, particularly for our lowest income residents,” Rubinstein said.

Multiple community groups and speakers including Charlie Shamas and representatives from housing advocacy organizations urged the Commission to adopt the CAC recommendation and criticized the mayor’s Office of Economic and Workforce Development (OEWD) for favoring market‑rate outcomes. Speakers said community input has not meaningfully altered project parameters and called for the PUC to use its authority to preserve public benefit.

PUC staff and counsel described the Commission’s limits. Deputy General Manager Michael McCarlin told commissioners the agency’s role is to preserve property value for ratepayers: the PUC will present the land’s residual value alongside proposed development scenarios when a surplus declaration is considered. “We’re trying to protect our property, our investment in the property and looking at the rate of return,” McCarlin said, noting development percentages and configurations have not been finalized.

City Attorney’s Office counsel Noreen Ambrose advised the Commission that the mayor’s office and the RFP process will set the development parameters and that the PUC’s formal decision will come later in the surplus and entitlement timeline. Ambrose offered confidential legal advice on the PUC’s charter responsibilities and the limits of imposing sale restrictions from the PUC dais.

Commissioners said they want to support maximizing affordable housing but asked for legal guidance to avoid actions that could violate fiduciary duties to ratepayers. Commissioner Courtney asked the city attorney’s office to provide draft guidance that would identify legal “land mines” and enable the PUC to adopt policy positions without exposing the utility to liability.

The discussion culminated in a pledge by staff to follow the public process: the RFP and developer-selection process will present the parameters for affordable housing and the PUC will have opportunities to weigh in at the surplus‑declaration and environmental review stages. Commissioners signaled they want to remain engaged and requested a future update from OEWD and staff on timing and possible PUC roles.

What’s next: staff will provide legal guidance and an update on the scheduling and RFP timeline; the PUC will see a surplus declaration and associated materials before any land transfer proceeds.