Committee Approves Water System Supplement, Library Bond Sale and $75,000 Preservation Release

The Budget & Finance Committee approved several capital and program matters on March 27, forwarding a supplemental appropriation for the Water System Improvement Program, authorizing the sale of library general obligation bonds and releasing reserved funds for a Market/Octavia preservation survey.

Julie Labonte, director of the Water System Improvement Program, told the committee she was seeking a supplemental appropriation totaling about $262 million to fund regional and local projects through calendar year 2008, including funds for delivery work and encumbrance of construction contracts. "Approximately 73% of this appropriation will be allocated to our regional projects, while 21% will be used for local projects," Labonte said. She flagged CEQA-related environmental review delays on a few projects and warned that some large projects could return to the committee later in the year for additional appropriations.

Controller's staff recommended an amendment to reduce the appropriation by $400,000 for commercial paper issuance fee savings; the committee accepted the budget analyst's recommended amendment and forwarded the item. Budget staff and the controller's office also noted that bond financing for the program will necessitate future water rate increases; the controller's report schedules a previously approved 15% rate increase effective 07/01/2008 and additional increases projected in later years.

On a separate item, the committee approved the authorization to sell City and County of San Francisco general obligation bonds (Branch Library Facility Improvement Bond, series 2008A) not to exceed $31,065,000. Anthony Ababond of the office of public finance said the competitive sale is scheduled for April 15 with a closing April 29 and that the bonds would have a 20-year term.

The committee also released $75,000 from the finance and budget reserve to fund Market/Octavia preservation survey work, with the Historic Preservation Fund Committee contributing $50,000. Planning Department staff Elaine Forbes said the work was endorsed by the Landmarks Board and neighborhood groups; Alan Martinez, speaking for the Landmarks Preservation Advisory Board, urged approval and noted some other survey work will be delayed as a result of the funding allocation. The motion to release the funds passed without objection.

What happens next: the controller and PUC will move forward with bond authorizations and the water program will return if CEQA approvals require additional appropriations; the Market/Octavia survey will proceed under the reduced scope and the city will schedule bond sale steps in April.