SFPUC adopts revised WSIP budget and schedule; Calaveras and Harry Tracy projects drive increases

The San Francisco Public Utilities Commission on July 28 approved a rebaseline of the Water System Improvement Program, adopting a revised program budget of $4.58 billion and a new overall completion date of Dec. 4, 2015. Commissioners voted to approve the rebaseline with an amendment directing staff to update system performance analysis, monitor schedule compression and report regularly on cost estimates versus awards and change orders.

Julie Labonte, the WSIP director, told the commission the revision reflects new project scopes, risk mitigation measures and recent low construction bids. Labonte said two projects account for much of the program increase: the Calaveras Dam project and the Harry Tracy long-term improvements, which together represent $285 million of the change. She said the revised program shows a $194 million, or roughly 4.4 percent, increase over the currently approved budget.

Labonte detailed the drivers at Calaveras: naturally occurring asbestos mitigation measures, which she estimated at about $63 million, and fisheries-related work tied to potential steelhead trout in Alameda Creek, which she estimated at $31 million. She said CEQA review and permitting contributed roughly two years of delay and that $12 million of the $31 million fisheries estimate was escalation while $19 million covered environmental-phase cost increases and consultant studies. "We're trying to resolve a lot of these issues as this project moves forward because we know it's controversial," Labonte said.

On the Harry Tracy project, Labonte said discovery of a previously unknown strand of the Sarah Fault near treated-water reservoirs required seismic upgrades, abandonment and reconstruction of reservoirs and retrofits of adjacent pipelines. She said roughly $183 million of the program increase is associated with addressing that seismic risk.

Public commenter Steve Lawrence urged far closer commission oversight and said schedules historically have not been met, warning that some project schedules appeared "dead on arrival." Stakeholder Art Jensen (Bauska) recommended independent performance checks and commended staff for their work.

Commissioner-sponsored amendments adopted as part of the motion require staff to (1) update the system performance analysis to confirm projects still meet adopted WSIP objectives and level-of-service goals; (2) present additional management actions to identify and avoid schedule delays and to address potential compression of construction into the final years of the program; and (3) report regularly on construction cost estimates versus awards and on change orders for each project. The commission also directed staff to conduct an external peer review this fall.

The commission voted to carry the amended resolution. The vote was taken after public comment and several hours of technical discussion; the decision included directing staff to submit notice-of-change reports to the California Joint Legislative Audit Committee, California Department of Public Health and the California Seismic Safety Commission, as required by state law. The commission also approved a package of contract amendments to professional services to support the rebaselined program.