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SFPUC adopts Lennar term sheet with requirement for on‑site solar despite one dissent
Summary
The San Francisco Public Utilities Commission adopted a resolution directing staff to secure on‑site solar for the Lennar/HPS development and to clarify financial figures, after amending the term sheet to ensure the developer’s $2 million contribution can fund on‑site installations; one commissioner voted against the measure citing indemnification and unresolved cost questions.
The San Francisco Public Utilities Commission on Dec. 12 adopted a resolution directing staff to secure on‑site solar installations as part of the Lennar/HPS redevelopment and to incorporate language in the term sheet allowing the developer’s $2 million contribution to be applied toward on‑site systems.
Commissioners debated an amendment to the resolution that would remove an ambiguous “or construct rooftop solar” clause and instead include an explicit mandate that the project will include on‑site solar. The commission then gave the general manager and city attorney authority to clean up final language in the term sheet.
One commissioner said before the vote: "I will vote against this resolution because I believe that the indemnification is an inappropriate action, and I am not yet convinced or understand what the financial impact would be." The chair then called the question and the resolution passed by voice vote with one dissenting vote.
Staff and the deputy city attorney explained the term sheet language under negotiation: Lennar may provide the $2 million contribution to the city to lower the cost of on‑site solar rather than delivering cash directly to the utility, enabling the PUC to structure the financing to reduce up‑front cost and avoid obligating the commission to buy back assets prematurely. Commissioners also agreed to appoint a small team to work with staff to reconcile and publish defensible cost figures before public release.
The resolution directs the general manager to take steps necessary to ensure on‑site solar is constructed within the project and to reflect that requirement in the final term sheet and contract documents. The commission did not remove the developer contribution but clarified the preferred use of that money for on‑site installations.
Next steps include finalizing the term sheet language with legal counsel, documenting the agreed financial assumptions, and returning any necessary contract language to the commission for ratification as required.
