three-year schedule of rates for retail water — CleanPowerSF Sfpuc Commission, May 23, 2023

Services of the San Francisco Public Utilities Commission Water & Sewer Rates and Charges Adoption
Fiscal Years Ending 2024, 2025, 2026
San Francisco Public Utilities Commission
Erin Corvinova, Financial Planning Director
May 23, 2023
1 Overview
• Agenda Item 6: Proposal to Adopt Water Rates for FYEs 2024, 2025, 2026
• Agenda Item 7: Proposal to Adopt Sewer Rates for FYEs 2024, 2025, 2026
• Presentations
• Water and Sewer Rates: Erin Corvinova, Financial Planning Director • Rates Education and Outreach: John Coté, Communications Director • Rate Fairness Board: Howard Ash, Rate Fairness Board Chair 2 Agenda
• 2023 Water Wastewater Rate Study
• Water Rates Proposal
• Sewer Rates Proposal
• Rates Education and Outreach
• Rate Fairness Board Companion Presentation
3 Rate Study Background
• San Francisco Charter requires:
• An independent cost of service study for each
utility at least every five years
• Rate Fairness Board review of proposed rates
• CA Proposition 218 sets legal requirements
for:
• Calculation of water and sewer rates based on
proportional allocation of costs to customer
classes
• Noticing customers of rate increases and
providing opportunity for public comment
•
Proposing three years of water and
wastewater rates beginning July 1, 2023
(FYEs 2024, 2025, 2026)
4 Rate Study Process
5 Revenue Requirement Analysis
• Calculate revenue adjustments necessary to meet policy, capital, and operating objectives
Cost of Service Analysis
• Equitably link costs to system functions, develop unit costs, and distribute revenue requirements to customer classes
Rate Design
• Design individual rates and charges to recover costs

Revenue Requirement Analysis
• Incorporates adopted 2-year budget, 10-Year Capital
Improvement Plan, and 10-Year Financial Plan
• Capital costs are 80% of the increase during the three years • Customer bill impacts will vary from these percentages due to cost allocation changes and individual usage patterns
6 Revenue Requirement
Increases
FYE
2024
FYE
2025
FYE
2026
Water 5.0% 5.0% 5.0%
Sewer 9.0% 9.0% 9.0%
Cost of Service Analysis
• Allocates system costs to a customer class based on
proportional use
• Key updates for this study:
• Detailed allocations of operating, revenue-funded capital, and debt service expenses
• Updated water peaking factors for system and customer classes to reflect post-pandemic usage patterns
• “Mass balance” of billed wastewater discharges vs. inflows to the treatment plants, allocating both flow and strength/contaminants to wet vs. dry weather
7 Water Rate Structure: No proposed changes
Fixed Charge
($/Month)
Customer Charge
• Flat per account
Meter Charge
• Increases with larger meter sizes
• Separate rates for Fire Sprinkler
vs. Standard Accounts
Volumetric
Charge ($/CCF)
2 Tiers for Residential
• 4 CCF for Single Family
• 3 CCF per Multi-family Dwelling
Unit
Uniform for Non-
Residential
Water Rates: Key Changes
• Increased Untreated Water rates: resulting
from higher cost allocation to raw water
supply (especially Calaveras Reservoir)
• Slight increase to Single Family cost
allocation: mainly from water peaking
behavior changes
9 Proposed Water Rates: Fixed Charges
10 Standard
Accounts
(by Meter Size)
Current FYE 2024 FYE 2025 FYE 2026
5/8 inch
$15.17 $16.64 $17.48 $18.36
3/4 inch $19.43 $21.13 $22.19 $23.30
1-inch $27.95 $30.11 $31.62 $33.21
1-1/2 inch $49.25 $52.56 $55.19 $57.95
2-inch $74.81 $79.51 $83.49 $87.67
3-inch $142.97 $151.35 $158.92 $166.87
4-inch $219.65 $232.18 $243.79 $255.98
6-inch $432.65 $456.70 $479.54 $503.52
8-inch $688.25 $726.13 $762.44 $800.57
10-inch $1,071.65 $1,130.26 $1,186.78 $1,246.12
12-inch $1,838.45 $1,938.54 $2,035.47 $2,137.25
16-inch $3,201.65 $3,375.47 $3,544.25 $3,721.47
Fire Service
(by Service
Size)
Current FYE
2024
FYE
2025
FYE
2026
1-inch
$9.55 $8.43 $8.86 $9.31
1-1/2 inch $12.45 $8.91 $9.36 $9.83
2-inch $15.93 $9.73 $10.22 $10.74
3-inch $25.21 $12.70 $13.34 $14.01
4-inch $35.65 $17.82 $18.72 $19.66
6-inch $64.56 $36.19 $38.00 $39.90
8-inch $99.45 $67.88 $71.28 $74.85
10-inch $151.65 $115.55 $121.33 $127.40
12-inch $256.05 $181.62 $190.71 $200.25
Proposed Water Rates: Volumetric Charges
11 Volumetric Rate
(per CCF) Current FYE
2024
FYE
2025
FYE
2026
Single-Family Residential
First 4 CCF per Month $9.60 $10.33 $10.85 $11.40
All Additional CCF $10.71 $11.47 $12.05 $12.66
Multiple-Family Residential
First 3 CCF per Dwelling
Unit per Month $9.60 $10.19 $10.70 $11.24
All Additional CCF $10.76 $10.94 $11.49 $12.07
Non-Residential $10.55 $11.12 $11.68 $12.27
Untreated Water Service $0.95 $1.80 $1.89 $1.99
Sewer Rate Structure: Current
Fixed Charge
($/Month)
Customer Charge
• Flat per account
Volumetric Charge
($/CCF)
Residential
• Charge per CCF of wastewater
discharged
Non-Residential
• Charge per CCF of wastewater
discharged
• Strength charges based on flow and
business type
Wastewater flows are estimated using a customer class specific “flow factor” multiplied by the metered water usage.

Sewer Rate Structure: Proposed
Fixed Charge
($/Month)
Customer Charge
• Flat per account
Wastewater
Charge ($/CCF)
Residential
• Charge per CCF of sanitary
sewage discharged
Non-Residential
• Charge per CCF of sanitary
sewage discharged
• Strength charges based on
flow and business type
Stormwater
Charge ($/Month)
Residential
• 3 tiers of flat monthly charges
Non-residential
• Charges per 1,000 sq ft
permeable and impermeable
area
Wastewater flows are estimated using a customer class specific “flow factor” multiplied by the metered water usage.

Sewer Rates: Key Changes
• Bifurcate current sewer rate into 2
components: wastewater charge and
stormwater charge
• Reflects SFPUC’s combined sewer system
• Does not change overall revenue collected
• Enhances rate equity by charging customers for
total flows contributed to the combined sewer
system
• Seven year phase-in to allow customers time to
adapt
14 Stormwater Charge Structure
Standard Charge
• Applicable to non-residential,
mixed use, vacant, and large
residential parcels
• Impermeable areas (roofs,
pavement, driveways) cause more
runoff, pay more
Simplified Residential
Charge
• Applicable to residential properties
with 6 or fewer dwelling units and
parcel area less than < 6,000 sq ft
• Tier based on total Assessor parcel
area
Area FY 2023-24 Rate
Impermeable
Charge
$1.89 / 1,000 sq ft per
month
Permeable
Charge
$0.19 / 1,000 sq ft per
month
Tier Parcel Size
Range (sq ft) FY 2023-24 Rate
1 1 – 1,700 $2.31 / month
2 1,701 – 3,300 $3.60 / month
3 3,301 – 6,000 $5.41 / month
Proposed Sewer Rates
Charge Current FYE 2024 FYE 2025 FYE 2026
Monthly Service Charge $5.21 $4.85 $5.28 $5.76
Wastewater Volumetric Charges
Residential ($/ccf) $15.97 $16.91 $17.80 $18.72
Non-Residential
Flow ($/ccf) $9.46 $9.74 $10.09 $10.43
Chemical Oxygen Demand ($/lb) $0.647 $0.861 $0.925 $0.994 Total Suspended Solids ($/lb) $1.647 $1.681 $1.808 $1.944 Oil & Grease ($/lb) $1.661 $1.053 $1.142 $1.239
Monthly Stormwater Charges
Simplified Residential Charge (based on total Assessor parcel area) Tier 1 (0-1,700 sq ft) $2.31 $5.04 $8.24
Tier 2 (1,701–3,300 sq ft) $3.60 $7.84 $12.82
Tier 3 (3,301–6,000 sq ft) $5.41 $11.79 $19.27
Standard Charge (Non-Residential, Large Residential, Mixed Use) Permeable ($/1,000 sq ft) $0.19 $0.41 $0.67
Impermeable ($/1,000 sq ft) $1.89 $4.11 $6.72
16 Customer Bill Impact: Average Single Family
Residential Customer
Assumes 4.8 CCF of water use per month 17

How do we stack up to our peers?
Each utility's average water usage is pulled from their online resources and published cost of service studies. If usage was provided per person per day, we calculated the average household size for each city using data from the US Census Bureau and an average of 30.5 days in a month.

Peer Agency Bills are estimated using
current effective rates as of March 2023
Communications: Education and Outreach
19 Public Outreach
Engaging, inclusive & multilingual campaign:
• Focus on money-saving options
• 182,000 formal Prop. 218 notices mailed
• Three virtual town hall meetings held
• Direct outreach to community organizations and leaders • Designated webpage with bill
calculator: sfpuc.org/2023Rates
• Email for customer questions: [email protected]
• Bill inserts mailed to customers (4 languages)
• Response to customers who submitted written protest
• Messages on paper bills and MyAccount web portal
• Targeted digital and social media ads (4 languages)

Modern Marketing
21 • Three multilingual eB lasts to 78,000 customers.

Extremely high open rate.
• Rates webpage was in the top five most viewed on
s
fpuc.org. Rates pages have seen more than 8,900
unique users to date.
• Social Media (Facebook/Instagram Ads and Posts):
• Shown to SF residents 5 97,390 times, 112,950 unique
people reached, resulted in 2,248 visits to 2023 rates
webpage
• Display Ads:
• Shown to SF residents 4 88,203 times, 1,449 clicks (click- through rate more than double the average)

Focus on Low-Income, Immigrant,
and BIPOC Communities
22 • Provided human translated materials and webpages
• Targeted ads in Chinese, Spanish, and Filipino media
• Ads in m edia with substantial Black audience or based in Bayview -Hunters Point • KBLX ads to Black community were displayed 471,000 times, which r
esulted in over 2,200 visits to our rates webpage.
• Univision: email blast sent to 84,000 Spanish-speaking SF residents. Display ads
served to more than 142,000 residents.
• Sing Tao: newspaper ad in Chinese reached at least 7,000 daily SF readers.

Rate Fairness Board
23 24
Rate Fairness Board Overview
25 Rate Fairness Board Charter
26 Multiple Rate Objectives
27 Two decades of positive change
SFPUC has moved toward traditional utility service role 28 RFB Views on Staff Proposal
29 RFB Views on Staff Proposal
30 RFB Views on Staff Proposal
31 Final Thoughts
A big Thank you to:
• Staff
• RFB members
• Our consultants:
• Raftelis
• McGovern McDonald Engineers
Questions?
32 Discussion
33 AGENDA ITEM
Public Utilities Commission
City and County of San Francisco

DEPARTMENT Financial Services AGENDA NO. 6
MEETING DATE May 23, 2023

APPROVAL:

COMMISSION
SECRETARY Donna Hood

Public Hearing: Adopt Retail Water Rates for FYE 2024 through FYE 2026 Project Manager: Matthew Freiberg
Summary of
Proposed
Commission
Action:

Public Hearing to consider and a dopt a new three-year schedule of rates for retail water service in San Francisco and suburban areas to be effective with meter readings on or after July 1, 2023. This action constitutes the Approval Action for the Project for the purposes of the California Environmental Quality Act (CEQA) pursuant to San Franci sco Administrative Code section 31.04(h) . The Planning Department has determined that this action is exempt from the CEQA. If the item is approved, the Commission will rely on that determination to make its decision.

Background: Executive Summary

San Francisco Public Utilities Commission (SFPUC) staff developed the proposed water rates in conformance with the requirements of the San Francisco Charter, at section 8B.125, and the California Constitution, at Article XIII- D (Proposition 218).

The rates proposal is the result of a year-long process that involved policy review, economic analysis, and public outreach. This work has been guided by the governance of a project charter and overseen by a project steering committee that included the General Manager, the SFPUC Executive Team and a staff working group from across the organization. As required by the Charter Section 8B.125, the rate proposal was developed with the support of an independent rate consultant that completed a cost-of-service analysis and rate design, consistent with the requirements of Proposition 218. The results of the study were also presented to the Rate Fairness Board. The findings of the study are summarized in the consultant’s report titled the 2023 SFPUC Water and Wastewater Rate Study (2023 Rate Study).

The 2023 Rate Study is comprised of three main components: a revenue requirement analysis, cost of service analysis, and rate design. After completing this rigorous process, and considering the recommendations of the independent rate consultant, SFPUC staff has determined rate increases are necessary to maintain revenue sufficiency and to meet operational goals. Over the next three years, Fiscal Year Ending (FYE) 2024 through FYE 2026, staff proposes to raise rates such that the average single family water bill increases by an average of 6% annually, as referenced in Table 1.

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

Page 2 ends

Table 1. Proposed Average Monthly Single Family Residential Water Bill

Proposed Rates
Average
Percent
Increase
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current
Rates
Effective
July 1, 2023
Effective
July 1, 2024
Effective
July 1, 2025
Water Fixed
Charge $15.17 $16.64 $17.48 $18.36
Water Variable
Charge $46.97 $50.50 $53.04 $55.73
Water Bill $62.14 $67.14 $70.52 $74.09
% Increase 8.0% 5.0% 5.0% 6.0%
Notes: Assumes 5/8” meter size and 4.8 CCF (centum (hundred) cubic feet or 748 gallons) monthly water usage. Bills are calculated excluding any drought surcharge that has been applied to the current variable charge.

Due to changes in cost allocations to customer classes and rate components as part of the cost-of-service analysis and rate design, bill increases will not exactly match the changes in rate revenue requirements in year one of the rate implementation. Bill increases will track with the proposed rate revenue requirements in all other years.

Overview of 2023 Water and Wastewater Rate Study

As required by the San Francisco Charter, the SFPUC retains an independent rate consultant at least every five years to evaluate the cost of service of the retail water and sewer systems and to recommend appropriate rate structures. The rate study is an engineering and financial exercise that explains the basis and rationale for proposed water rates, supported by a cost-of-service analysis, and provides an administrative record to satisfy the legal requirements of California’s Proposition 218 and the Charter.

The previous water and wastewater rate study was completed in 2018 and supported rates for the four-year period beginning FY 2018-19 through FY 2021-22. The proposed rates of the next three years support the ongoing operations and maintenance costs, payments of debt service, and implementation of the SFPUC capital improvement program.

The SFPUC selected the consulting team of McGovern McDonald Engineering and Raftelis Financial Consulting as the independent rate consultant through a competitive Request for Proposals process. Staff and the independent rate consultant have been working on the 2023 SFPUC Water and Wastewater Rate Study since summer 2022. Staff have coordinated internally with the Water Enterprise leadership, Business Services, External Affairs, the General Manager’s Office, and the Rate Fairness Board to receive input and management direction on a wide range of topics, including the impact of the drought and customer water conservation on the SFPUC’s finances, capital financing forecasts, residential tiers, fixed/variable cost recovery, non-residential customer classes, as well as analysis of customer affordability.

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

Page 3 ends

This report presents the outcome of the 2023 Rate Study, highlighting each major task and outcome. This rate study is the basis for proposed water and sewer rate increases resulting in an 8.4% average annual increase, over the next three years, on the single family residential combined monthly bill as noted below in Table 2.

Table 2. Proposed Average Monthly Single Family Residential Combined Bill

Proposed Rates
Average
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current
Rates
Effective
July 1, 2023
Effective
July 1, 2024
Effective
July 1, 2025
Water $62.14 $67.14 $70.52 $74.09
Sewer $74.20 $81.51 $90.01 $99.45
Combined $136.34 $148.64 $160.53 $173.53
% Increase 9.0% 8.0% 8.1% 8.4%
Note: Assumes 5/8” meter size and 4.8 CCF monthly water usage

Retail Water Rate Change Rationale
The Water Enterprise has made significant progress on seismic improvements and upgrades to its water infrastructure through the Water System Improvement Program (WSIP). With the funding provided by rate increases approved in prior years, the SFPUC seismically upgraded reservoirs, replaced pipelines, and added new, modernized facilities. The cost of WSIP investments in the regional system is shared with the SFPUC’s 27 wholesale customers. As of March 2022, approximately 99% of WSIP projects are complete, but additional capital projects are planned. These and other bond-funded capital projects are projected to increase debt service costs 14% over the next three years from $328.4 million in Fiscal Year Ending (FYE) 2023 to $373.7 million in FYE 2026. In addition, gradual increases in operating expenses are also projected to follow long term inflationary growth of 3% annually. Capital costs are significant drivers of rates; approximately 79% of every new dollar generated by the rate increase will cover water capital needs, either the payment of debt service or cash-funding of capital projects.

Historic Water Demand
As can be seen in Figure 1 below, retail water use held relatively constant following the conservation gains from 2014 -2016 drought with very little rebound. Water use has subsided again with the current drought and changes in demand characteristics due to the COVID-19 pandemic, with retail customers reducing their annual water use by 8.0% in 2023, compared to 2020. The revenues that would have been lost due to this level of conservation have been largely offset by drought surcharges that were authorized by the Commission the prior rate approval.

As of March 2023, retail customers have increased water usage by 4.1%, on a 12- month rolling basis, from their low point in 2022, but past experience and uncertainty around future water sales projections require a prudent approach to be taken in forecasting future demand.

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

Page 4 ends

Projected Water Demand

SFPUC projects a slight near term rebound in future water demands as the City recovers from COVID-19. However, over the longer-term, water use is projected to decline for a variety reasons: hardened water conservation customer behavior post- drought; replacement to more efficient water fixtures; better management of leaks; sensitivity to increasing water rates (price elasticity).

The shaded areas on Figure 1 illustrate the uncertainty in projected demand given the multiple unknowns that are being accounted for in projected water demand.

While our financial plan was developed applying usage as shown in the dashed line plot, future water demands could possibly be higher or lower. If demands are higher than projected, SFPUC could implement lower rates than are recommended in this report. However, the financial plan accounts for the chance that water sales continue to decline. Our recommendations will allow the Water Enterprise to continue to meet SFPUC’s financial obligation even with lower than projected water sales.

Figure 1. Historic and Projected Retail Water Sales (MGD (Million Gallons per Day)

Independent Consultant – 2023 SFPUC Water and Wastewater Rate Study

SFPUC staff has worked closely with the independent rate consultant to analyze the current revenues and revenue requirements of the Water Enterprise, conducted a detailed review of the Enterprise’s cost of service, and reviewed the current rate design. The Rate Study’s recommended changes to retail water rates are designed to:

• Provide sufficient revenues for the operations, maintenance, and repair of the enterprise, consistent with industry best practices;
• Provide sufficient revenues to improve or maintain financial condition and bond ratings at or above levels equivalent to highly-rated utilities of each enterprise;

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

Page 5 ends

• Conform to all SFPUC financial policies;
• Meet requirements and covenants under all bond indentures; and • Set rates based on cost of service and in compliance with State law.

The independent consultant has determined that rate increases are necessary to fund the projected operating and capital costs of the Enterprise. Detailed information on the projected revenue requirements, cost of service analysis, and rate design can be found in the 2023 Rate Study report, which is has been provided as an attachment to this report and which is available online at sfwater.org/rates.

Water Enterprise Revenue Requirements

The 2023 Rate Study compared the forecasted revenues of the utility to its forecasted operating and capital needs. Included in this forecast are the Water Enterprise’s Commission approved FYE 2023 and FYE 2024 Budget, 10-Year Capital Plan, and 10-Year Financial Plan. This revenue requirement analysis determines if current rates are adequate to cover the projected annual operating and capital expenditures while meeting the enterprise financial obligations and SFPUC financial policies. This analysis identified that revenues under existing rates would be insufficient to fund the Enterprise’s expected financial obligations.

If rates remained the same, the Enterprise would be unable to generate sufficient revenues to pay all projected costs and to meet debt service coverage and reserve targets. Holding rates at their current level would result in a failure to meet our debt service coverage target by FYE 2026, fund balancing dropping below the 90-day operating reserve by FYE 2027, and fund balancing being completely exhausted by FYE 2028. Based on the 2023 Rate Study analysis, the SFPUC is proposing a three-year adjustment to retail water rates increasing Water Enterprise revenues by 5% in FYE 2024, 5% in FYE 2025, and 5% in FYE 20261.

Cost of Service Analysis

The 2023 Rate Study completely updated the cost-of-service analysis for the Water Enterprise. The cost-of-service analysis serves as a rational basis for distributing the full costs of SFPUC’s services to each customer class in proportion to the demands placed on the system. The analysis includes:
• A more detailed analysis of the allocation of costs to enterprise functions • An update on demand assumptions for each customer class • Detailed breakdown of costs to support cost of service analysis • Revised system peaking assumptions based on recent customer demands • Updated allocation of costs to each customer class

1 Due to changes in cost allocations to customer classes and rate components as part of the cost-of- service analysis and rate design, bill increases will not exactly match the changes in rate revenue requirements in year one of the rate implementation. Bill increases will track with the proposed rate revenue requirements in all other years.

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

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Rate Design

Water rate design analysis determines how the costs are recovered from each customer through specified water rates. The focus of this process is to achieve cost recovery and substantiate that customers are paying their fair and proportionate share of system costs. This is achieved by calculating rates for each customer class based on the respective customer classes system demands and the costs allocated to that class based on the cost-of-service analysis.

Rate Structure
The SFPUC’s water rate structure consists of two components: (1) a monthly service charge based on meter sized (fixed) and (2) a commodity charge which is based on water volumetric charges derived from metered water usage (variable).

1. Fixed monthly service charges for residential and non-residential customers vary by meter size

2. Variable charge for residential customers is comprised of a two-tier, inclining block rate structure, while non-residential customers are charged a uniform commodity rate specific to their customer type

Proposed Rates
The Staff recommendation is to maintain the current water rate structure, but with updated rates that reflect the updated costs of service allocations, as shown in the attached report and resolution.

Affordability

Ratepayer affordability is a policy priority of the Commission and is a part of the Ratepayer Assurance Policy. Staff have performed analyses and developed recommendations for ways to support ratepayers who may be burdened by their utility bills. The SFPUC approved a level of service goal in 2012 to keep the average single family combined bill under 2.5% of the San Francisco median household income.

Using Census data, staff were able to identify and analyze the demographics of customers paying more than 2.5% of the median household income on water bills.

This analysis found that of the approximately 160,000 who directly pay their water bills, approximately 17,000, or 11%, are “cost-burdened” with greater than 2.5% of their household income dedicated to their utility bill. These cost-burdened households are more likely to be families and women-led households, people of color, to be linguistically isolated (having no one over the age of 14 who speaks English well or very well), to be over 65, and/or to live in the southeast part of the city.

This analysis was used to inform changes to the existing Customer Assistance Program (CAP) in April 2023. In addition, staff are currently evaluating new affordability policies that take into consideration the bill impact of low-income customers as well as households earning the median income.

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

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Rate Fairness Board

The proposed retail water rates have been presented to and discussed by the Rate Fairness Board (RFB) at eight public meetings over the past year, and more recently in more than 30 community outreach meetings to neighborhood groups, chambers of commerce, and environmental associations. The RFB’s presentation on the proposed rates is also being presented at this May 23rd Commission meeting.

Public Outreach and Education

The SFPUC Communications Team has been engaged in important communication, outreach, and education on the water and wastewater rates proposal. The Team has reached out to more than 400
organizations to describe SFPUC services, why rate
increases are needed, and what the impact will be on their monthly bill. Between February and May of 2023 we have offered stakeholder briefings to more than 30 organizations; invited more than 400 organizations and their members to attend three virtual town hall meetings; and launched a multi-lingual public marketing campaign that includes ads in four languages to educate the public about the rates proposal, invite them to the town hall meetings, and direct them to extensive information on a dedicated rates web page. We also created a one-stop-shop web page with information about how customers can save on their bill which includes information on discount programs, grants, rebates, and incentives.

In addition, the
team has engaged in multiple forms of communication to reach our ratepayers through the use of bill inserts, emails, physical flyers, social media, and targeted marketing using print, digital, and broadcast outlets. Special attention has been provided to BIPOC communities and people for whom English is a second language. This includes direct emails to 92,000 customers, geo-targeted Google ads, Facebook video ads, and ads with Univision, Sing Tao, and Fil-Am Radio.

Public Notice & Rate Adoption Process

In compliance with the notice requirements of California’s Proposition 218, the SFPUC issued the attached official notices to customers and property owners informing them of the proposed rate changes and their right to submit a written protest against the proposed rates. The notice also informed customers and property owners that if the SFPUC receives written protest from a majority of affected property owners and customers the proposed rate increases will not take effect.

Additionally, the notice informs customers that under California Government Code section 53759, there is a 120-day statute of limitations for challenging any new, increased, or extended fee or charge.

Pursuant to Charter Section 16.112, a Notice of Public Hearing on the establishment of a schedule of rates was published in the official newspaper on April 12, 13, 14, 16, and 19, 2023 and posted on the SFPUC website and at the San Francisco Public Library, for a public hearing on May 23, 2023, with possible Commission action on this date. If approved by the Commission, these rates would take effect July 1, 2023, unless rejected by the Board of Supervisors, as provided in Charter section 8B.125.

Proposal to Adopt Water Rates for FYE 2024 through FYE 2026 Commission Meeting Date: May 23, 2023

Page 8 ends

Environmental
Review:

On May 8, 2023 the San Francisco Planning Department determined the Project to be statutorily exempt from environmental review under the CEQA section 21080(b)(8) and the CEQA Guidelines section 15273 (Rates, Tolls, Fares, and Charges) (Case No. 2023-004066ENV), related to the establishment, modification, structuring, restructuring, or approval of rates, tolls, fares, or other charges. The exemption determination can be found here: https://sfpuc.sharefile.com/d- scf9d27e30321428a947c1215c95166ea

This action constitutes the Approval Action for the Project for the purposes of the CEQA pursuant to San Francisco Administrative Code section 31.04(h).

Results of
Inaction:

A delay or denial in approving this agenda item will result in no water rate changes for retail customers as of July 1, 2023. Delay or denial of the proposed rates will adversely impact the SFPUC’s ability to meet projected revenue requirements for the Water Enterprise. SFPUC will be required to either defer capital projects, which will negatively impact the Enterprise’s ability to continue to provide services to our customers or return to the Commission with an updated rate proposal that will need to be larger to account for the loss of revenue from delaying the implementation of rates.

Recommendation: SFPUC staff recommends that the Commission adopt the attached resolution.

Attachments: 1. Schedule of Retail Water Rates

2. 2023 SFPUC Water and Wastewater Rate Study

3. Prop 218 Notice to Customers

4. Notices of Public Hearing

5. Protest Letters

PUBLIC UTILITIES COMMISSION
City and County of San Francisco

RESOLUTION NO.:

WHEREAS, In accordance with Section 8B.125 of the Charter of the City and County of San Francisco, the San Francisco Public Utilities Commission (SFPUC) retained an independent rate consultant, Mc Govern McDonald Engineering and Raftelis Financial Consulting , that prepared the report titled 2023 SFPUC Water and Wastewater Rate Study (2023 Rate Study) , which has been submitted to the Rate Fairness Board for its review and posted to the sfwater.org website; and

WHEREAS, The General Manager and staff have reviewed the 2023 Rate Study , and have prepared a staff rate proposal, which has been submitted to the Rate Fairness Board for its review and has posted to the sfwater.org website; and

WHEREAS, The Rate Fairness Board reviewed the findings and recommendations of the 2023 Rate Study and staff rate proposal and presented its own report to this Commission on May 23, 2023, finding that water revenues under existing rates will be insufficient to meet revenue requirements of the Water Enterprise; and

WHEREAS, Based on the analysis set forth in the 2023 Rate Study, the SFPUC finds that water revenues under existing rates will be insufficient to meet revenue requirements of the Water Enterprise as projected in the Water Enterprise 10 -Year Financial Plan, and recommend s that rate adjustments are needed resulting in revenue requirement increases of 5% in fiscal year ending 2024, 5% in fiscal year ending 2025, and 5% in fiscal year ending 2026; and

WHEREAS, As required by
California Constitution, at Article XIII -D ( Proposition 218) , SFPUC issued a notice of the proposed rate change to all ratepayers and property owners more than 45 days in advance of the May 23, 2023 public hearing; and

WHEREAS, Pursuant to Charter Section 16.112, a Notice of hearing on the proposal to adopt a new schedule of rates was published in the official new spaper on April 12, 13, 14, 16, and 19, 2023, and posted on the SFPUC website and at the San Francisco Public Library, as required, for a public hearing on May 23, 2023; and

WHEREAS, Pursuant to the published notice of the intention of the SFPUC to adopt a revised Schedule of Retail Water Rates to be charged for retail water service in San Francisco and adjacent areas, a public hearing was held on May 23, 2023, and members of the public were given an opportunity to comment on the revised Schedules of Water Rates; and

WHEREAS, At the May 23, 2023 public hearing, the Commission considered protests against the proposed rates. The SFPUC received written protests against the proposed rates were presented by less than a majority of parcel owners and direct water services customer tenants; and

WHEREAS, This Commission hereby finds that adoption of this resolution will establish rates for the purpose of: m eeting operating expenses, including employee wage rates and fringe benefits; purchasing or leasing supplies, equipment, or materials; meeting financial reserve needs and requirements, obtaining funds for capital projects necessary to maintain service within existing service areas; and obtaining funds necessary to maintain such intra -city transfers as are authorized by the City’s Charter; and

WHEREAS, on May 8, 2023 the San Francisco Planning Department determined the Project to be statutorily exempt from environmental review under the California Environmental Quality Act (CEQA) section 21080(b)(8) and the CEQA Guidelines section 15273 (Rates, Tolls, Fares, and Charges) ( Case No. 2023-004066ENV), related to the establishment, modification, structuring, restructuring, or approval of rates, tolls, fares, or other charges; and

WHEREAS, Under Charter Section 8B.125, the Commission must set rates and charges, subject to rejection by the Board of Supervisors within 30 days of submission; now, therefore , be it

RESOLVED, That this Commission hereby determines, based on the findings of the 2023 Rate Study, that projected revenues under existing retail water rates, together with other revenues of the Water Enterprise, will be insufficient to meet the revenue requirements of the Wa ter Enterprise as projected in the Water Enterprise 10-Year Financial Plan, and that overall increases of water rates by 5% in the fiscal year ending 2024, 5% in the fiscal year ending 2025, and 5% in the fiscal year ending 2026 are therefore warranted; and be it

FURTHER RESOLVED, That the Commission hereby adopts the revised Schedule of Retail Water Rates, attached to this Resolution and incorporated by reference as if set forth here in full, to apply to all retail Customers, as defined in the Schedule, of San Francisco’s Water System, on or after July 1, 2023.

I hereby certify that the foregoing was adopted by the Public Utilities Commission at its meeting of May 23, 2023.

___________________________________
Secretary, Public Utilities Commission

SCHEDULE OF RETAIL WATER RATES
EFFECTIVE JULY 1, 2023
(Adopted May 23, 2023 by Commission Resolution No.: XX-XXXX)

Section 1 – Authority and General Purpose
This Schedule was adopted by the Commission pursuant to Section 8B.125 of the Charter of the City and County of San Francisco for the purpose of establishing an orderly system for the imposition and collection of charges for the operating, maintenance, replacement, debt service and other costs incurred by the San Francisco Water Enterprise in gathering, treating and delivering water for consumptive and other uses in San Francisco and other areas receiving retail service from the Water Enterprise.

Section 2 – Definitions
For the purpose of this Schedule, the following definitions shall apply unless the context specifically dictates otherwise.

“City”
The City and County of San Francisco

“Commission”
The San Francisco Public Utilities Commission

“Customer”
Any person, firm, corporation, partnership, trust, or any other entity including, but not limited to, local, state and federal governments utilizing the services of the City’s utility systems.

“Customer Class”
Customers with the same or similar usage characteristics are grouped into Customer Classes for purposes of cost allocation and rate setting.

“Dwelling Unit”
As defined in San Francisco Planning Code Section 102.7, a room or suite of two or more rooms that is designed for, or is occupied by, one family doing its own cooking therein and having only one kitchen. For the purposes of this resolution, “Dw elling Unit” shall not include a lodging house, rooming house, motel or hotel, as defined in San Francisco Housing Code Section 410, or a live/work unit, as defined in Section 102.13 of the San Francisco Planning Code.

“Equivalent Meter”
A measure of the capacity of a meter expressed as a ratio to the capacity of a 5/8 X 3/4 meter.

“General Manager”
The General Manager of the Public Utilities Commission or his or her designee.

“Operations and Maintenance Costs”
Expenditures used for the storage, treatment, and delivery of Retail and Regional water including, but not limited to, the costs of personnel, materials and supplies, energy and administration.

“Retail Customer”
Retail customers are all individual customers that receive direct water service from SFPUC.

“Residential Customer”
A Residential Customer is the owner or customer of record of any single-family or multiple-family Dwelling Unit.

“Water System”
The City’s water system including all properties (real, personal, and tangible or intangible) owned, operated, maintained by and under the jurisdiction of the Commission used for the gathering, impounding, treatment, transmission and distribution of water, including all future additions, extensions, replacements and improvements to the system.

Section 3 – Customer Classification
a. Class Determination
Upon application for new service, each Customer shall be assigned to a Customer Class based on the City’s evaluation of the Customer’s usage characteristics in accordance with the requirements of this resolution and applicable laws and regulations. Such Customer Class determination shall be based on the Customer’s description of its current operation and use of the water facilities of the City. Such description shall be subject to verification by the City.

b. Change in Classification
Customers requiring or requesting a change in their classification shall do so in writing within 30 days of a change in operations.

Section 4 - Ent
erprise Funds

Pursuant to Article V, Section 5.01 of the Indenture between the San Francisco Public Utilities Commission and U.S. Bank, NA, as trustee, all revenues of the Water Enterprise shall be set aside and deposited into a fund in the City treasury (the Revenue Fund). All amounts paid into the Revenue Fund shall be maintained separate and apart from other City funds. Moneys in the Revenue Fund shall be appropriated and expended in accordance with the Indenture.

Section 5 – Billing Rates for Retail Water
The following Schedules of Retail Water Rates to be paid by all retail customers of the City’s Water System are hereby adopted and imposed.

SCHEDULE W-1A: Single Family Residential Service
Applicable to single-family dwelling units inside and outside of the City and County of San Francisco served through a separate meter or bank of meters:

First: A Monthly Service Charge based on the size of the meter.

Meter
Size
Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current Rates Effective
July 1, 2023
Effective July 1,
2024
Effective July 1,
2025
5/8 in $15.17 $16.64 $17.48 $18.36
3/4 in $19.43 $21.13 $22.19 $23.30
1 in $27.95 $30.11 $31.62 $33.21
1-1/2 in $49.25 $52.56 $55.19 $57.95
2 in $74.81 $79.51 $83.49 $87.67
3 in $142.97 $151.35 $158.92 $166.87
4 in $219.65 $232.18 $243.79 $255.98
6 in $432.65 $456.70 $479.54 $503.52
8 in $688.25 $726.13 $762.44 $800.57
10 in $1,071.65 $1,130.26 $1,186.78 $1,246.12
12 in $1,838.45 $1,938.54 $2,035.47 $2,137.25
16 in $3,201.65 $3,375.47 $3,544.25 $3,721.47

Second: A charge for all water delivered based on monthly meter reading.

Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current Rates Effective
July 1, 2023
Effective July 1,
2024
Effective July
1, 2025
First 4 CCF per month $9.60 $10.33 $10.85 $11.40
All additional CCF $10.71 $11.47 $12.05 $12.66

SCHEDULE W-1B: Multi-Family Residential Service
Applicable to multi-family accounts within and outside of the City and County of San Francisco consisting of two or more dwelling units served through a separate meter or bank of meters:

First: A Monthly Service Charge based on the size of the meter.

Meter
Size
Current Proposed
FYE 2023 FYE 2024 FYE 2023 FYE 2024
Current Rates Effective
July 1, 2023
Effective July 1,
2024
Effective July 1,
2025
5/8 in $15.17 $16.64 $17.48 $18.36
3/4 in $19.43 $21.13 $22.19 $23.30
1 in $27.95 $30.11 $31.62 $33.21
1-1/2 in $49.25 $52.56 $55.19 $57.95
2 in $74.81 $79.51 $83.49 $87.67
3 in $142.97 $151.35 $158.92 $166.87
4 in $219.65 $232.18 $243.79 $255.98
6 in $432.65 $456.70 $479.54 $503.52
8 in $688.25 $726.13 $762.44 $800.57
10 in $1,071.65 $1,130.26 $1,186.78 $1,246.12
12 in $1,838.45 $1,938.54 $2,035.47 $2,137.25
16 in $3,201.65 $3,375.47 $3,544.25 $3,721.47

Second: A charge for all water delivered based on monthly meter reading.

Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current Rates Effective
July 1, 2023
Effective July 1,
2024
Effective July 1,
2025
First 3 CCF per month $9.60 $10.19 $10.70 $11.24
All additional CCF $10.76 $10.94 $11.49 $12.07

SCHEDULE W-1C: Commercial, Industrial, Public, and General Uses

Applicable to commercial, industrial, public buildings, parks, docks & ships, and other general uses within and outside of the City and County of San Francisco, excluding Wholesale customers, served through a separate meter or bank of meters:

For Street Sprinkling and Flushing when quantities are computed from records of tank wagons and billed as one amount: Schedule W-1C (no service charge to apply)

First: A Monthly Service Charge based on the size of the meter.

Second: A charge for all water delivered based on monthly meter reading.

Current Proposed

FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current Rates Effective
July 1, 2023 Effective July 1, 2024 Effective July 1, 2025 For all units of
water $10.55 $11.12 $11.68 $12.27

For Municipal Street Sprinkling and Flushing when quantities are computed from records of tank wagons and billed as one amount: Schedule W-1C (no service charge to apply)

SCHEDULE W-2: Fire Service
Applicable to private fire service within and outside of the City and County of San Francisco installed and maintained according to the rules, regulations and Specifications of the San Francisco Water Enterprise.

First: A Monthly Service Charge based on the size of the service.

Meter
Size
Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current Rates Effective
July 1, 2023
Effective
July 1, 2024
Effective
July 1, 2025
1 in $9.55 $8.43 $8.86 $9.31
1-1/2 in $12.45 $8.91 $9.36 $9.83
2 in $15.93 $9.73 $10.22 $10.74
3 in $25.21 $12.70 $13.34 $14.01
4 in $35.65 $17.82 $18.72 $19.66
6 in $64.65 $36.19 $38.00 $39.90
8 in $99.45 $67.88 $71.28 $74.85
10 in $151.65 $115.55 $121.33 $127.40
12 in $256.05 $181.62 $190.71 $200.25

Second: If water is used for any purpose other than extinguishing accidental fires, the W-1C rates for water delivery shall apply.

SCHEDULE W-4: Docks and Shipping Supply within the City and County of San Francisco.

Applicable to special shipping service, including hose truck and other special services, from open docks through common hydrants where delivery is not through a service and meter for which the customer is responsible:

First: A Docks & Shipping Connection Charge: Schedule W-44

Second: A charge for all water delivered based on monthly meter reading: Schedule W-1C

SCHEDULE W-5: Hydrant Use for Temporary Water Supply

Applicable to temporary metered service connections through fire hydrants within the City and County of San Francisco:

First: A Builders and Contractors Connection Charge: Schedule W-44

Second: A Meter Rental Deposit: Schedule W-44

Third: A Monthly Service Charge based on the size of the meter:

Meter
Size
Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2023
Current Rates Effective
July 1, 2023
Effective
July 1, 2024
Effective
July 1, 2025
5/8 in $15.17 $16.64 $17.48 $18.36
3/4 in $19.43 $21.13 $22.19 $23.30
1 in $27.95 $30.11 $31.62 $33.21
1-1/2 in $49.25 $52.56 $55.19 $57.95
2 in $74.81 $79.51 $83.49 $87.67
3 in $142.97 $151.35 $158.92 $166.87
4 in $219.65 $232.18 $243.79 $255.98
6 in $432.65 $456.70 $479.54 $503.52
8 in $688.25 $726.13 $762.44 $800.57
10 in $1,071.65 $1,130.26 $1,186.78 $1,246.12
12 in $1,838.45 $1,938.54 $2,035.47 $2,137.25
16 in $3,201.65 $3,375.47 $3,544.25 $3,721.47

Fourth: A charge for all water delivered based on monthly meter reading: Schedule W-1C

Fifth: Any customer who fails to report water consumption as required shall be assessed a non- reporting penalty equivalent to the cost of 25 units of water per month at the current W-1C volumetric rate.

SCHEDULE W-24: Untreated Water Service

Applicable inside and outside the City and County of San Francisco for untreated water service when the customer furnishes all facilities necessary to convey the untreated water from the San Francisco Water Enterprise's water supply reservoirs to the customer’s point of use.

First: A Monthly Service Charge based on the size of the meter.

Second: A charge for all water delivered based on monthly meter reading.

Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Current Rates Effective
July 1, 2023
Effective
July 1, 2024
Effective
July 1, 2025
For all units of water $0.95 $1.80 $1.89 $1.99

Section 6 - Drought Surcharge
If the Commission, at a publicly noticed meeting, adopts a resolution declaring a stage of water delivery reduction in accordance with the Retail Water Shortage Allocation Plan (i.e., Stage 1, Stage 2 or Stage 3), the following schedule of drought surcharges shall be applied to retail water rates as of the date of the Commission resolution or any effective date designated by the Commission. For residential customers, the surcharges shall be based on the assumption that the overall demand reduction is split evenly between Tier 1 and Tier 2. Each nonresidential customer shall incur the percent drought surcharge uniformly. The overall required surcharge is based on the final formula: surcharge ($ per ccf) = Water Revenue Shortfall from reduced flow/ Reduced Water Flow.

The drought surcharges shall remain in effect until the Commission, at a publicly noticed meeting, adopts a resolution rescinding the water delivery reduction.

Section 7 – Effective Date
The rates for FYE 20 24 set forth herein shall be effective for water meter readin gs made on or after July 1, 2023 or as soon thereafter as possible. The rates for FYE 2025 shall be effective for water meter readings made on or after July 1, 2024. The rates for FYE 2026 shall be effective for water meter readi ngs made on or after July 1, 2025, and shall remain in effect until repealed, modified or superseded.

Proposed Water and Sewer Rates for Fiscal Years Ending 2024-2026 Every day, the San Francisco Public Utilities Commission (SFPUC) generates clean energy, delivers high-quality water to 2.7 million Bay Area customers, and protects the environment and public health by treating wastewater and stormwater for San Francisco residents and businesses. Our work is almost exclusively funded by the rates that customers pay. Our systems work 24 hours a day, 7 days a week. We are a not-for-profit public utility whose rates reflect the true cost of operating, maintaining, and upgrading our water and sewer systems. To continue delivering the services that San Franciscans depend on, the SFPUC is proposing water and sewer rate increases, effective July 1, 2023.

Your Dollars at Work
Water and sewer systems are critical to public health. The SFPUC is committed to providing customers with safe, reliable, and affordable drinking water and a combined sewer system that reduces flooding and protects the environment from pollution. These systems require ongoing maintenance and upgrades. Many parts of the SFPUC water system are nearly 100 years old, and the oldest parts of the sewer system date back to the Gold Rush. We need to continue to maintain and upgrade aging systems to prevent breaks, meet regulatory requirements, improve seismic safety, and adapt to storms as the climate changes. Your dollars pay for essential services and projects that protect public health.

Our Public Rate Setting Process
The SFPUC is committed to a transparent public rate setting process guided by the principles set forth in our Ratepayer Assurance Policy. As required by the San Francisco Charter, an independent rate consultant has completed a cost-of-service study. The rate study findings provide the basis for our rate proposal, which goes through an extensive public approval process. That process includes the Rate Fairness Board, comprising SFPUC customers and other appointees. The Rate Fairness Board holds public meetings and provides recommendations to ensure affordability, stability, and fairness.

Interested customers and other parties can provide comments on the proposed rates at the Rate Fairness Board and Commission hearings. To learn more about our rates package, rate setting process, and upcoming meetings, visit sfpuc.org/2023Rates .

Proposed Rates Schedule
The SFPUC is proposing to update the sewer rate structure and to update water and sewer rates effective July 1, 2023. The SFPUC’s combined sewer system treats both wastewater and stormwater runoff. The new rate structure would split the sewer portion of bills into two parts: a wastewater component and a stormwater component. This new structure would not change the total amount of revenue collected by the SFPUC, but it would more scientifically and equitably allocate the existing costs of managing wastewater to ratepayers. This new structure would be gradually phased in over seven years.

The proposed new rate schedule represents an average monthly bill increase of $12.69 each year for the average single-family residential household in San Francisco (about 8.3% per year).

The following sections describe these bill components for residential and non-residential customers.

Our website has examples of an average single-family monthly bill, as well as a bill calculator where you can develop personalized bill estimates. Visit sfpuc.org/2023Rates for the bill calculator and other useful information.

Bills contain two core elements: fixed charges that cover shared costs relevant to all customers and volumetric rates based on the amount of water used or wastewater produced.

Monthly Fixed Charges
Service charges are the same every month, regardless of water consumption.

Water service charges vary by meter size. Water service charges recover fixed costs, like customer service and billing, maintenance of water meters, and facilities used to provide water for fire protection that benefits all SFPUC customers.

Sewer service charges are the same for all sewer customers. Sewer service charges recover a portion of fixed costs associated with customer service and billing, which are the same for all SFPUC customers.

Stormwater service charges would be assessed on a three-tiered structure for residential customers, based on the total assessor’s parcel size, with smaller parcels being charged a lower rate that gradually increases for larger parcels. Non-residential, mixed-use, and large residential parcels (over 6,000 square feet or with more than six dwelling units) would be charged based on their total permeable and impermeable surface area. Permeable surfaces, like planters and lawns, can absorb water except in large storms. Impermeable surfaces, like driveways and roofs, direct more water to — and impose more costs on — the sewer system. Stormwater charges recover the cost of stormwater-specific infrastructure and the stormwater portion of the combined system.

Fire sprinkler service charges are for properties with fire sprinklers or standpipes. These charges are calculated to recover costs for customer service, billing, and maintenance specific to private fire meters.

Volumetric Rates: Residential Customers
Residential water rates are billed based on metered water usage and have two tiers. For single-family properties, the first four units of water per month are billed the first-tier rate, and any additional units are billed the second-tier rate. For multi-family residential properties, the first three units of water per dwelling unit per month are billed the first-tier rate, while any additional units of water are billed the second-tier rate. The second tier is a higher unit rate to reflect the additional costs needed to reliably serve high-volume users 24/7.

Residential wastewater rates are billed based on the estimated volume of water that returns to the sewer system. The default volume for single-family residences is 90% of water usage; the default for multi-family residences is 95% of water usage. All discharge units of wastewater are billed at the same rate.

Your Rates Pay For:
• 24/7 Operations
• Routine Maintenance and
Emergency Repairs
• Infrastructure Improvements
• Conveyance and Treatment
• Environmental Monitoring
• Watershed and
Land Management
• Community Programs
For further information, visit sfpuc.org/2023Rates.

Reference your most recent bill to obtain your meter
size and water use (per month).

Volumetric Water Rates (1 unit of water = 1 Ccf = 748 gallons) Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Single-Family Residential - Water per unit
First 4 units per month
(Tier 1) $9.60 $10.33 $10.85 $11.40
All additional units (Tier 2) $10.71 $11.47 $12.05 $12.66 Multi-Family Residential - Water per unit
First 3 units per dwelling
unit per month (Tier 1) $9.60 $10.19 $10.70 $11.24
All additional units (Tier 2) $10.76 $10.94 $11.49 $12.07 Non-Residential - Water per unit
For all units of water $10.55 $11.12 $11.68 $12.27
Untreated Water Service
For all units of water $0.95 $1.80 $1.89 $1.99
Proposed Fire Service Rates (Per Service)
Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Monthly Private Fire Service Charge
1 in. $9.55 $8.43 $8.86 $9.31
1-1/2 in. $12.45 $8.91 $9.36 $9.83
2 in. $15.93 $9.73 $10.22 $10.74
3 in. $25.21 $12.70 $13.34 $14.01
4 in. $35.65 $17.82 $18.72 $19.66
6 in. $64.65 $36.19 $38.00 $39.90
8 in. $99.45 $67.88 $71.28 $74.85
10 in. $151.65 $115.55 $121.33 $127.40
12 in. $256.05 $181.62 $190.71 $200.25
Proposed Water Rates
Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Monthly Service Charge - Water (based on meter size)
5/8 in. $15.17 $16.64 $17.48 $18.36
3/4 in. $19.43 $21.13 $22.19 $23.30
1 in. $27.95 $30.11 $31.62 $33.21
1-1/2 in. $49.25 $52.56 $55.19 $57.95
2 in. $74.81 $79.51 $83.49 $87.67
3 in. $142.97 $151.35 $158.92 $166.87
4 in. $219.65 $232.18 $243.79 $255.98
6 in. $432.65 $456.70 $479.54 $503.52
8 in. $688.25 $726.13 $762.44 $800.57
10 in. $1,071.65 $1,130.26 $1,186.78 $1,246.12
12 in. $1,838.45 $1,938.54 $2,035.47 $2,137.25
16 in. $3,201.65 $3,375.47 $3,544.25 $3,721.47
Proposed Stormwater Runoff Charge Rates
Monthly per
Assessor Parcel
Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Residential (6,000 sq. ft. and under/six dwelling units and under) Tier 1: 0-1,700 sq. ft. N/A $2.31 $5.04 $8.24
Tier 2: 1,701-3,300 sq. ft. N/A $3.60 $7.84 $12.82
Tier 3: 3,301-6,000 sq. ft. N/A $5.41 $11.79 $19.27
Non-Residential (All other customers)
$/1000 sq. ft. Permeable N/A $0.19 $0.41 $0.67
$/1000 sq. ft. Impermeable N/A $1.89 $4.11 $6.72
Proposed Wastewater Rates (1 unit of water = 1 Ccf = 748 gallons) Current Proposed
FYE 2023 FYE 2024 FYE 2025 FYE 2026
Monthly Service
Charge Wastewater $5.21 $4.85 $5.28 $5.76
Residential - Wastewater per unit discharged
For all discharge units $15.97 $16.91 $17.80 $18.72
Non-Residential - Wastewater per unit discharged
Volume per
discharge unit $9.46 $9.74 $10.09 $10.43
Chemical Oxygen
Demand per lb. $0.647 $0.861 $0.925 $0.994
Total Suspended
Solids per lb. $1.647 $1.681 $1.808 $1.944
Oil and Grease per lb. $1.661 $1.053 $1.142 $1.239
Periodically the SFPUC undertakes rate studies to ensure the rates customers are charged reflect the true cost of providing our services. Adjustments are then proposed to ensure all customers are treated fairly, uninterrupted services are provided, strict environmental regulations can be met, and the financial stability of our assets and systems are maintained long-term.

PRESORTED

SECOND-CLASS MAIL
U.S. POSTAGE PAID

SAN FRANCISCO, CA
PERMIT NO. 4
525 Golden Gate Avenue, 12th Floor
San Francisco, CA 94102

NOTICE OF PUBLIC HEARING
And Important Information Regarding Water and Sewer Rates Proposed for Fiscal Years Ending 2024-2026.

You have 120 days to challenge rate changes. Get more info at:
sfpuc.org/2023Rates or (415) 554-3289.

AVISO DE AUDIENCIA PÚBLICA
E información importante sobre las tarifas de agua y alcantarillado propuestas para los años fiscales que terminan 2024-2026. Tiene 120 días para Desafiar los cambios de tarifas.

Obtenga más información en: sfpuc.org/2023Rates o (415) 554-3289.

ABISO NG PAMPUBLIKONG PAGDINIG
At Mahalagang Impormasyon Tungkol sa Mga Rate ng Tubig at Imburnal na Iminungkahing Para sa Mga Taon ng Piskal na Magtatapos sa 2024-2026. Mayroon kang 120 araw upang hamunin ang mga pagbabago sa rate. Kumuha ng higit pang impormasyon sa:
sfpuc.org/2023Rates o (415) 554-3289.
公聽會通知
有關 2024-2026 財政年度新擬議供水和污水處理費的重要信息。您有 120 天的時間來質
疑新收費。如需更多信息，請上網：sfpuc.org/2023Rates 或 (415) 554-3289。 Volumetric Rates: Non-Residential Customers
Non-residential water rates are billed based on metered water usage. There are no tiers for non-residential customers.

Non-residential wastewater rates vary based on the volume of pollutants present in the discharge of various customer types. As a result, the rates shown in the table have four parts: a volumetric charge based on 90% of the customer’s billed water consumption and three strength charges based on the concentration of pollutants in a customer’s wastewater discharge. The concentrations are based on the type of business operated at the service address. Visit our website at sfpuc.org/2023Rates to look up the pounds of pollutants per unit of wastewater for your business type.

Temporary Drought Surcharge
A drought surcharge is a temporary charge that is levied only when the SFPUC Commission puts the SFPUC Water Shortage Contingency Plan into effect, requesting that customers reduce water usage. When implemented, the drought surcharge increases the volumetric water and wastewater rates for all customer types up to the percentages shown in the table on the right. These percentages are calculated to recover costs based on reduced billed volumes.

As an example, if the Commission declares a Stage 1 drought, asking customers to reduce water consumption by 5%, the SFPUC will analyze the forecasted reduced billed volumes and set a water and wastewater drought surcharge of up to 5%. For water, this 5% temporary surcharge would be applied to both tier rates for residential water customers and to the volumetric rate per unit for non-residential customers. For sewer, this surcharge would be applied to the volumetric rate per unit of wastewater discharge for residential and non-residential customers, as well as the rate per pound of pollutants for non- residential customers.

The SFPUC may set the percentage surcharge lower than shown on the table below to ensure that rates do not exceed the costs of providing water and wastewater services to customers.

Ways to Save
The SFPUC offers a variety of rebates, programs,
and incentives to help customers lower their bill.

Learn more at sfpuc.org/2023Rates or call
(415) 551-3000.

Water Shortage
Contingency Plan Stage
Target Water
Usage Reduction
Drought Surcharge on Volumetric
Water & Wastewater Rates
Stages 1 - 35%Up to 5%
Stage 45-18%Up to 18%
Stage 5 - 618-32%Up to 32%
S.F. Public Utilities Commission Meeting
Revised Hearing Date: Tuesday, May 23, 2023 at 1:30 p.m.

San Francisco City Hall, Room 400
1 Dr. Carlton B. Goodlett Place
This is the second notice regarding these proposed water and sewer rates.

The meeting date for the rate hearing has been rescheduled to May 23, 2023, at 1:30 pm. No other changes have been made to the proposed rates.

In accordance with Article XIII D, Section 6, of the California Constitution (also known as Proposition 218), you have the right to submit a written protest against the proposed water and sewer rates. The proposed rate increases will not take effect if the SFPUC receives written protests from a majority of the affected property owners and customers.

Written protests must be mailed to the SFPUC Commission Secretary at the address below or hand delivered to the Commission Secretary at the May 23, 2023 Commission public hearing in order to be counted.

Protests may not be delivered electronically or verbally. Any written protest must: (1) state that the identified property owner or customer is in opposition to the proposed rates increase; (2) provide the location of the identified parcel (by assessor’s parcel number, street address, or customer account); and (3) include the name and signature of the person submitting the protest.

Although oral comments at the public hearing will not qualify as a formal protest unless accompanied by a written protest, the SFPUC welcomes input from the community during the public hearing on the proposed water and sewer rates. Only one protest may be registered per property.

Mail Protests to:

SFPUC Commission Secretary
525 Golden Gate Avenue, 13th Floor
San Francisco, CA 94102
We value your input.

If you have questions or would like more information, please visit sfpuc.org/2023Rates or email [email protected].

Under California Government Code section 53759, there is a 120-day statute of limitations for challenging any new, increased, or extended fee or charge. This statute of limitations applies to the water and sewer service rates and charges proposed in this notice.

It also applies to future changes to water and sewer rates and charges.

Revised Notice of Public Hearing on Proposed Water and Sewer Rates Prsrt Std
U.S. Postage PAID
San Francisco CA
Permit No. 925

NOTICE OF PUBLIC HEARING

TUESDAY, May 23, 2023 - 1:30 P.M.

City Hall, Room 400
1 Dr. Carlton B. Goodlett Place
San Francisco, CA 94102

NOTICE OF PUBLIC HEARING: Tuesday, May 23, 2023 – 1:30 PM City Hall, Room 400, 1 Dr. Carlton B. Goodlett Place, San Francisco, CA 94102, at a Regular Meeting of the San Francisco Public Utilities Commission:

Public Hearing, discussion, and possible action to adopt the proposed water and sewer rates and charges for customers of the San Francisco Public Utilities Commission. The resolutions to be presented at the hearing are (1) Proposal to Adopt Retail Water Rates for FYE 2024 through FYE 2026; and (2) Proposal to Adopt Sewer Rates for FYE 2024 through FYE 2026. If approved, the new rates and charges would take effect July 1, 2023.

Copies of the agenda item and related files will be available 72 hours in advance of the May 23, 2023 meeting on the Commission’s websit e: https://sfpuc.org/about-us/boards- commissions-committees/sfpuc-commission/agendas-minutes-resolutions-log

Posted: April 10, 2023
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/254/238/238 /251 /250/3 /7/253/3 /251/9/238/225/253/254/254/250/239/23 /239 /250 /253/3 /24/239 /12/238/10/239 /250 /251 /238 /236 /9/251 /251/11/239 /236/25 /25/239/8 /11/237/4 /2/253/1 /7 /25/241/10/253 /237 /251/23 /237 /239/25 /10/253 /241/1/240 /239/23 /4/253/254/254/250/239 /239 /250 /253/3/239/23 /4/253/254/254/250/251 /251 /238 /238 /239/25/239/8 /11/237/4 /23 /4/253/254/254/250/239 /239 /250 /253/3 /25/241/7/238/3/240 /241 /239/23 /254/250/3/237 /251 /238 /239/23 /1/238 /239 /253 /252 /237 /251 /250 /253/3/239/23/252 /253/7 /184/26/198/204/202/27 /28/220/28/220 /213/29

CleanPowerSF Sfpuc CommissionMay 23, 2023

CleanPowerSF Sfpuc Commission
May 23, 2023