SFPUC advances two‑year budgets and 10‑year plan with targeted amendments

The San Francisco Public Utilities Commission approved its proposed two‑year operating and capital budgets and the accompanying 10‑year capital and financial plans after adopting a package of targeted amendments.

Commissioners voted to adopt the FY2011–12 operating and capital budget and the FY2012–13 second year framework that together included the recently updated 10‑year capital plan. Assistant General Manager and CFO Tom Reedstrom told the commission the first year of the two‑year budget totals about $818 million and the second year about $861 million; most increases reflect planned debt service for capital projects and modest net changes in benefit projections.

The commission’s action included three substantive amendments made during the meeting. First, the commission agreed to continue consideration of the wastewater capital program—postponing formal adoption until a full review of sizing and rate impacts at the Feb. 22 meeting so commissioners can weigh program scale and rate scenarios. Second, commissioners directed staff to remove the projected revenue bond debt tied to Hetch Hetchy from the financial plan beginning in 2014 so the plan reflects that assumption explicitly and leaves open options for funding. Third, the commission approved reallocating approximately $3 million in unanticipated power enterprise revenue from recent market sales: $1 million each to the GoSolar SF program, energy efficiency and conservation, and the nascent community choice aggregation (CCA) effort.

Commission discussion cited several drivers behind the budget posture: a modest upward revision in pension rates (from a previously assumed 16.5% to an adopted 18.1% of pensionable salary) and lower‑than‑expected health‑benefit cost increases (about 6.6% employer share versus an earlier 10% assumption). Reedstrom said these benefit updates altered projections by roughly $200,000 across the enterprise, small relative to the overall program.

Commissioners also directed staff to return with a refined financial plan showing rate scenarios through the 10‑year horizon so the body can see what levers exist to keep future rate increases in single digits if desired. The commission emphasized that the wastewater capital sizing decision will directly affect rate outcomes and that more detailed program management and independent review will inform any final action.

Next steps: staff will carry the budget package, incorporating the adopted amendments, into the mayor’s office submittal and return with the wastewater‑specific sizing and rate analysis on Feb. 22.