Annual Real Estate Report
San Francisco Public Utilities
Commission
August 29, 2023
2 MIS SION
The San Francisco Public Utilities Commission (SFPUC) provid es its customers with high-quality, efficient, and reliable water, power, and sewer services in a manner that is inclusive of environmental and community interest s, and that sustains the resources entrusted in its care. The Real Estate Services Division (RE S) of the SFPUC furthers this mission by carefully issuing and administering rental agreements for the real property over which the SFPUC has jurisdiction (SFPUC Property), increasing rental revenue, and by selling underutilized SFPUC Property.
RES also serves the three SFPUC enterprises by negotiating real property acquisitions and office and industrial leases for SFPUC operations and SFPUC capital projects and by resolving complex title issues. RES negotiates with third parties who desire to acquire property interests from the SFPUC. Finally, RES works with colleagues in other divisions to protect the SFPUC by vetting proposed third- party projects for potential negative impacts on SFPUC Property and infrastructure. To this end, RES leads the In- City Project Review Team in San Francisco and engages in two Project Review Teams outside the City.
RES does not perform facilities management, which the three enterprises handle.
SFPUC RENTAL REVENUES AND PROPERTY TAXES
RES staff spends significant time negotiating new leases , licenses, and memoranda of understanding for the use of SFPUC Property . The SFPUC rental agreement portfolio generates over $14 million annually from over 600 agreements. These transactions are subject to a complex project review process by several SFPUC divisions, the City Attorney’s Office, and regulatory agencies. The real estate agreement s often require Commission and Board of Supervisors’ approval.
The SFPUC earned $1 4,218.619.06 in real estate rental revenue during the fiscal year 2022-2023. Please see the chart attached as Exhibit A for a breakdown of the revenue by enterprise.
The SFPUC paid $2,790,037.24 in property taxes and assessments across the seven counties in which the SFPUC operates . Please see the chart attached as Exhibit B for a breakdown of taxes paid per county.
SFPUC rental agreements required tenants and licensees to reimburse the SFPUC for their pro rata share of property taxes and assessments paid by the SFPUC in proportion to the square footage of the SFPUC parcel s they occupy. The SFPUC recouped 3 $228,992.78 in property taxes and assessment reimbursements from its tenants and licensees in the past fiscal year.
SFPUC RENT AL EXPENDITURES
The SFPUC is both a landlord and a tenant. The SFPUC spends over $5,871,749.93 in annual rent for industrial and office facilities leases. The SFPUC spends over $150,000 in annual license use fees for telecommunications sites and utility crossings and almost $2,300,000 annually to rent space from the Port of San Francisco (Port) under Memoranda of Understanding. Please see the chart attached as Exhibit C for a summary of the SFPUC as tenant rental expenditures during the fiscal year 2022-2023.
The City's post -pandemic hybrid office/remote work model provided an opportunity to accommodate staff formerly working leased premises to return to work at the SFPUC headquarters at 525 Golden Gate Avenue (SFPUC Headquarters) . On August 21, 2023, the SFPU C terminated a month-to-month lease at 544 Golden Gate Avenue in San Francisco, thereby saving the SFPUC $32,816.78 per month in rental expenditures.
In addition, the SFPUC obtained an early termination of an industrial lease at 50 Quint Street on February 28, 2023. The SFPUC leased the premises to provide parking for Sewer System Improvement Program contractors. A later consolidation in Sewer System Improvement Program projects meant that the SFPUC no longer needed to use the leased premises.
The lease term was due to expire on October 31, 2023. To avoid responsibility for the recurring vandalism on the leased premises, the SFPUC paid a fee of $924,384 to the
landlord to terminate the lease as of February 28, 2023. This amount represented the remaining rent for the full term. The SFPUC also paid the landlord $1,034,376 to repair
the vandalism damage.
4 KEY REAL ESTATE INI TIATIVES
SFPUC HEADQUARTERS CAFÉ LEASE
SPRO Café
On April 11, 2023, the SFPUC entered into a lease with SPRO, LLC (SPRO) to operate a new café in the lobby of the SFPUC Headquarters. “SPRO” is industry slang for espresso. The cafe tenant opened in the building in August of 2023 after conducting tenant improvements and is already a welcome lively addition to the building.
Before the SPRO opening, the lobby space remained vacant for approximately three years after the prior café tenant ceased operations in the b uilding due to the pandemic building closure.
The SFPUC issued a Request for Proposals in 2022 for a new café operator to lease the Premises. The SFPUC received seven proposals responding to the Request for Proposals. SPRO earned the highest score.
5 SOUTHEAST COMMUNITY CENTER AT 1550 EVANS AVENUE
Southeast Community Center - Office Space
The Southeast Community Center, located at 1550 Evans Avenue in San Francisco, California opened on October 22, 2022, to replace t he aging Southeast Community Facility. The SFPUC operates the Southeast Community Center under a State Water Resources Control Board order . T he order required the construction and operation of a facility to offset the adverse social and economic impacts of the Southeast Wastewater Treatment Plant on the surrounding neighborhood.
The Southeast Community Center benefits the City and the l ocal Bayview-Hunters Point community by providing reservable event spaces, leased non-profit office space, open space, an on- site café, and a childcare center. Since its opening, the Southeast Community Center has hosted over 842 events and has rec eived over 32,000 visitors contributing to a vibrant hub of activity.
The entire third floor of the Southeast Community Center offers rented office space and meeting rooms to qualified community -based, non- profit entities to provide health, well-being, cultural, educational, and/or financial empowerment services, and
6 programming to the Bayview -Hunters Point community to further the Southeast Community Center ’s Mission. There are three office suites, nine Community Hub workstation desks, and four shared reservabl e meeting rooms. After the SFPUC selected qualified non-profit entities to occupy the third- floor spaces through a Request for Proposals process, RES completed the negotiation of leases and licenses this year for all the office suites and workstations. The leases have five- year terms for the leases and the workstation licenses have 18-month terms.
The following non-profit community service providers rent space on the third floor of the Southeast Community Center:
• 3rd Street Youth Center & Clinic
• Charity Cultural Services Center
• Edgewood Center for Children and Families
• En2Action, Inc.
• Five Keys Schools and Program
• Renaissance Entrepreneurship Center
• The Office of Civic Engagement and Immigrant Affairs, a City department.
In addition, in 2022, the SFPUC leased the ground floor space to Hungry Kitchens, LLC, and the childcare provider, Wu Yee Children’s Services. Wu Yee currently serves approximately 67 children enrolled in the federal Head Start Program.
7 SMALLER REAL ESTATE TRANSACTIONS IN THE PAST YEAR
Unlike in prior years, RES did not have the opportunity to participate this past year in a large SFPUC land sale or the entitlement of a major development project, such as the sale of the 17-acre Balboa Reservoir parcel for housing in 2020. Moreover, the SFPUC did not acquire any land for water quality protection purchases, like the 800- acre Wool Ranch acquisition in 2019. Instead, RES participated in many smaller transactions.
Conceptual Balboa Reservoir Aerial Rendering
8 FIRST AMENDED AND RESTATED LAKE MERCED M OU
Lake Merced
The SFPUC owns Lake Merced and the surrounding watershed land in San Francisco (Lake Merced Tract”). The City acquired the Lake Merced Tract in 1930 as part of the City’s acquisition of the Spring Valley Water Company. Lake Merced is an important natural, recreational, and emergency water resource for the City and the surrounding region.
RES supported the Water Enterprise in a multi -year effort with the San Francisco Recreation and Parks Department (Recreation and Parks Department) to achieve a new agreement confirming the departments’ respective use and responsibilities regarding the portion of the Lake Merced Tract located in San Francisco. This effort culminated on February 14, 2023 in the Commission’s approval via Resolution No. 23- 0043 of the First Amended and Restated Memorandum of Understanding between the parties.
9 CONDITIONAL TRANSFER OF FRANCISCO RESERVOIR
In 2014, the SFPUC entered a Memorandum of Understanding with the Recreation and Parks Department for the conditional transfer of the Francisco Reservoir to the Recreation and Parks Department. The SFPUC tendered possession of the approximately 4.5-acre site to the Recreation and Parks Department on September 30, 2014.
The final transfer of the Francisco Reservoir will occur after the Recreation and Parks Department pays the sum of $9,900,000 in installments plus interest over 12 years to the SFPUC. RES calculates periodic interest and monitors the transfer payments. To date, the Recreation and Parks Department has paid the SFPUC the sum of $7,284,342, representing $6,475,188 in principal and $808,995 in interest.
Here is an image of the beautiful Francisco Park on the former reservoir site:
Francisco Park
SALE OF REAL PROPERTY INTERESTS
FOR STATE HIGHWAY IMPROVEMENTS
The California Department of Transportation (Caltrans) and various counties frequently target SFPUC land for road improvement projects. These entities seek to acquire
10 easements and small areas of SFPUC land to widen bridges and roads and install other road improvements. Sometimes, Caltrans and a county publi c works department will join together to accomplish a road improvement project.
Highway improvement projects generally are complex and time -consuming. They require significant SFPUC staff resources to vet the projects to ensure their compliance with SF PUC policies, and to negotiate purchase and sale agreements and ancillary agreements, such as temporary licenses and cost-sharing agreement for the relocation of SFPUC water transmission pipelines.
One time -intensive RES project is the ongoing Stanislaus C ounty - Caltrans North County Corridor Project – Phase 1 State Route 108 Expressway Project.
This is a high- priority project for Stanislaus County to build a west -east expressway to improve regional circulation. The project seeks to connect State Route 219 near Modesto to State Route 120 near Oakdale. Stanislaus County and Caltrans have completed their environmental review for the project. The proposed expressway alignment crosses SFPUC Property at two locations during two different phases of the project. The current phase (phase 1) will require widening Oakdale Road over SFPUC Property to support an anticipated increase in vehicular traffic.
Stanislaus County sent to the SFPUC an offer to purchase a road easement for the widening of Oakdale Road on the portions of the right of way designated as SFPUC Parcel Numbers 647 and 648.
RES is working on the revocable license and purchase and sale agreement for the road easement with Stanislaus County . This work is occurring while Hetch Hetchy Water and Power continue s to work with the project team to review phase 1 of the project to protect SFPUC infrastructure.
PENDING SALE OF TWO MANZANO WAY LOT S IN SUNNYVALE
After a public noticing process and a public bidding process, the SFPUC’s Commission, through its Resolution No. 20-0030 on February 11, 2020, approved the sale of two vacant residential lots of land (designat ed by SFPUC staff as Parcels No. 1 and 2) in Sunnyvale to Manzano Property, LLC for $1,100,000. The buyer later withdrew from the transaction due to the uncertain economic climate result ing from the COVID -19 pandemic and the shelter-in-place orders.
Sunnyvale subsequently approached the SFPUC about acquiring Parcels No. 1 and 2 for use as a public park. RES staff obtained an updated appraisal for Parcels No. 1 and 11 2 and negotiated a purchase and sale agreement with Sunnyvale. Staff hopes to finalize this purchase and sale transaction in 2024 if Sunnyvale satisfies its obligations under the agreement.
The City, through the SFPUC, sold the third Manzano Way lot to Valley Water in 2022.
PENDING SALE OF PARCEL 9 IN SAN BRUNO
The SFPUC desires to sell one remnant parcel of the former Old Muni Right of Way to San Bruno.
In 1944, t he City acquired the Market Street Railway Company, an old railway line running from San Francisco to Burlingame. Caltrain and BART later acquired most of these railroads right of way parcels through condemnation or purchase to install their surface and subsurface infrastructure.
The City, through the SFPUC , still owns remnant non- contiguous parcels of the former railroad right of way (Old Muni Right of Way) in San Mateo County. The Old Muni Right of Way has long been on the SFPUC’s list of underutilized properties, meaning that the parcels do not have a utility use for the SFPUC. The SFPUC rents the use of the remaining Old Muni Rig ht of Way parcels to various third parties for street improvements, pedestrian pathways, and other uses.
In 1999, the SFPUC issued a Revocable Permit to San Bruno. Under the Permit, San Bruno uses four parcels of the Old Muni Right of Way , including the 50-foor wide Parcel No. 9, to maintain a roadway, landscaping, and underground utility facilities on Huntington Avenue in San Bruno. The SFPUC does not maintain any infrastructure in Parcel No. 9.
Parcel 9
12 Since 2021, San Bruno has sought to construct a two-way bicycle track on Parcel No. 9, among other parcels owned by other parties ( Project). The Project would narrow the existing roadway median and vehicle travel lanes on Huntington Avenue between Forest Avenue and San Bruno Avenue on Parcel No. 9 to accommodate the construction of the bicycle track while also maintaining a pedestrian sidewalk along the northbound direction of the roadway.
In July 2023, the SFPUC received San Bruno’s formal offer to purchase Parcel No. 9 for the appraised fair market $5,000 value. RES anticipates seeking approval from the SFPUC Commission and the San Francisco Board of Supervisor s in the upcoming months.
OTHER ONGOING INITIATIVES WITH PUBLIC AGENCIE S
Many older revocable permits issued by the SFPUC for public agency use of SFPUC Property are outdated . They often do not document all of the current public agency uses on SFPUC Property. In addition, these older permits lack the modern engineering restrictions, environmental protections , and indemnity and insurance requirements found in current SFPUC real estate agreements.
RES works on an ongoing basis to issue modern revocable licenses to replace these outdated agreements. This is a time -consuming process due to other agencies’ desire to maintain the status quo and avoid entering into modern licenses with more restrictive terms. Lengthy negotiations culminated in RES issuing updated agreements last year for the following municipalities’ use of SFPUC Property:
CITY OF LOS ALTOS
The SFPUC finalized a nearly six -year negotiation for a new license with Los Altos in 2023. The long- standing discussions arose from some historic land use issues pertaining to Los Altos’ maintenance obligations and the vegetation removal of over a dozen trees and the local community’s use of an unlicensed portion of SFPUC Property for a pedestrian and bicycle pathway.
The new license requires the removal of the trees and maintenance of the entire portion of the SFPUC Property used by Los Altos constituents. In addition, the license replaced and superseded four licenses dating back to 1961 with a modern form of agreement for the existing uses.
13 CITY OF BURLINGAME
The SFPUC owns the former Muni Right of Way parcels in Burlingame. In 1962, the SFPUC issued a revocable permit to Burlingame to maintain a portion of California Drive, and the installation of public street parking, and landscaping within the SFPUC Property.
In 1990, the SFPUC issued an updated lease to Burlingame for the continued use of the SFPUC Property for street purposes, parking, and landscaping. In 1995, the SFPUC terminated the lease due to an unauthorized sublease by Burlingame. Despite the terminated lease, Burlingame continued to use the SFPUC Property without a lease due to its existence as a roadway. Since then, the SFPUC has conducted many discussions with Burlingame to discuss a potential sale of the SFPUC Property or enter into a new license.
The SFPUC recently authorized a new lice nse to Burlingame to renew its use of a portion of the SFPUC Property for a roadway, parking, and landscaping. Further discussions are required to achieve a new license for the other portions used by Burlingame.
CITY OF MENLO PARK
RES began negotiations with Menlo Park nearly two years ago to review a major street improvement proposal within SFPUC Property commonly referred to as Ivy Drive. The project included the replacement of seven outdated permits issued by the SFPUC between the years 1966 and 1984 for the use of SFPUC Property. In 2023, RES finalized the new license with Menlo Park.
CITY OF SUNNYVALE
RES is currently negotiating with Sunnyvale to replace eight outdated agreements issued by the SFPUC between 1976 and 2004 with two new licenses allowing the use of portions of SFPUC Property for various public uses including a pedestrian trail on SFPUC Property in Sunnyvale. RES has been in a multi -year discussion with Sunnyvale to remove the unpermitted encroachments before the issuance of the new licenses. Sunnyvale has begun the encroachment removal process.
These licenses will also require Sunnyvale to install and maintain six SFPUC signs at various locations of the SFPUC Property to educate users about the Hetch Hetchy Regional Water System and the importance that the pipeline right of way plays in the transmission of water.
CITY OF DALY CITY
14 The SFPUC and Daly City are working together to implement the complex Vista Grande Drainage Basin Improvement Project to divert stormwater from the Vista Grande Watershed to Lake Merced. After an extensive title research project to confirm the property interests of various entities in the project area (the SFPUC, the San Francisco Public Works Department, Caltrans, the federal government, and the Olympic Club), RES is working with Daly City to (i) transfer a small portion of SFPUC Property east of John Muir Drive to Daly City ; (ii) convey easements to Daly City for the installation and operation of new and existing infrastructure; and (iii) assign the SFPUC’s interest in the existing easement for its Vista Grande Tunnel to Daly City.
WASTEWATER EASEMENT RECOVER Y PROJECT
Easement Recovery Project Subdivision Map
The SFPUC’s Wastewater Enterprise operates and maintains its sewer assets within public streets and easements through privately -owned land in San Francisco. The Easement Recovery Project is an organized effort to locate and catalog all of the sewer easements for City -owned sewer infrastructure throughout San Francisco. This project is approximately 90 percent complete.
In 1996, via a Mayoral Directive, the Mayor transferred all sewer -related functions of the Department of Public Works to the SFPUC’S Wastewater Enterprise. Through this transfer, many of the real estate documents for the locations where sewers operate
15 within private property easements were misplaced. This means that in many cases when maintenance is requested or projects affecting sewer infras tructure arise, RES staff must research whether the infrastructure belongs to the Wastewater Enterprise or a private party , whether the SFPUC has any specific maintenance or restoration obligations regarding the sewer infrastructure, and whether the SFPUC has any rights to protect its infrastructure.
A few years ago, RES initiated the Easement Recovery Project to compile and map the thousands of real estate and other records documenting the Wastewater Enterprise’s assets, particularly sewer easements. For the past few years, RES staff has (i) reviewed historical records to confirm the missing sewer easement data; (ii) confirmed the locations of the sewer assets for which no easements exist; and (iii) recovered the easement deeds or governing documents for the locations where Wastewater Enterprise infrastructure operates within private property.
In 2023, RES staff worked with other SFPUC staff to create a new geographic information system (GIS) layer for the Wastewater Enterprise. The GIS layer maps over 2,300 easement locations in the City and provides access to the repository of available records. RES continues to find and add deeds and governing documents to the GIS layer. Once completed, the SFPUC will have a complete set of records for all locations where the Wastewater Enterprise infrastructure crosses under third-party property.
REMAINING UNDERUTILIZED PROPERTY
The SFPUC has the following remaining underutilized parcels: (1) the two Manzano Way lots in Sunnyvale discussed above; (2) the Niles Reservoir and cottage in Fremont; and (3) the remaining Old Muni Right of Way parcels in Burlingame. RES continues its efforts to sell these u nderutilized parcels. The dispositio n of any property serving no present or future utility purpose eliminates operational and maintenance costs as well as unforeseen capital expenditures that arise due to continued ownership.
16 NILES RESERVOIR PROPERTY
Niles Reservoir
The Niles Reservoir property in Fremont consists of two parcels containing a residential structure, a shed, a garage, and utilities as follows:
• T he Niles Reservoir site at 38240 Canyon Heights Drive is a partially -improved approximately 7.45-acre site. The site contains an approximately 60,000 square- foot -inactive concrete reservoir with infrastructure and utility appurtenances; and • T he cottage site at 38234 Canyon Heights Drive is an approximately 21,209- square-foot site improved by a vacant residential structure. The SFPUC refers to both sites together as the “Niles Reservoir.”
In 2016, the SFPUC , through a broker, advertised and issued invitations to bid on the purchase of the Niles Reservoir. In November 2016, RES staff pursued a purchase and sale contract with the highest bidder. Due to an anti -growth movement in Fremont, however, the bidder withdrew from the contract in January 2018, and the two other bidders also declined to pursue a purchase and sale contract. RES staff will resume efforts to sell the Niles Reservoir and the Old Muni Right of Way in a more constant economic climate.
17 RES PARTICIPATION IN SFPUC CAPITAL PROJECTS
RES staff acquires real estate rights for many Capital Improvement Program projects implemented mostly through the SFPUC’s Project Management Bureau. These capital projects are varied and include those under the Water System Improvement Program, the Sewer System Improvement Program, Water and Wastewater Enterprise Renewal and Replacement Programs, and other capital programs requiring right -of-way acquisition work.
RES support includes conducting extensive research and analysis of right -of-way parcel ownership, providing input and feedback during the project planning and design phases, providing maps and drawings, coordinating with property owners and other public agencies and City departments, working with adjacent property owners to remove encroaching structures and vegetation before beginning project work, acquiring land rights from private property owners, negotiating agreements for temporary laydown and construction staging areas on third- party land, and negotiating, drafting, and seeking approval for various agreements.
CURRENT SFPUC CAPITAL PROJECTS
RES actively participates in the development of new capital projects during the alternatives analysis, conceptual engineering, and design phases, identifying potential right-of-way issues and needs, and providing opportunities to design around them at early stages, where possible. RES works closely with the Project Management Bureau to assess alternatives, identify right-of-way issues, and plan acquisition strategies. RES supports the Project Management Bureau in drafting alternative analysis rep orts and scoring and selecting various project alternatives and alignments for further development.
RES also participates in Technical Steering Committee meetings, presenting information to senior staff and fielding questions for the committee’s consideration of the project at certain key milestones to determine whether project development should move forward.
18 MOCCASIN PENSTOCKS REHABILITATION PROJECT
For example, RES worked with the Project Management Bureau to evaluate alternatives for the Moccasin Penstocks Rehabilitation Project. The existing alignment of the SFPUC penstocks1 crosses National Park Service land under the jurisdiction of the Bureau of Land Management, as well as private property. RES perf ormed an extensive analysis of the required authorizations and property rights for each alternative and wrote the relevant sections for the alternative analysis report. RES then assisted the Project Management Bureau in identifying and recruiting panelist s with right -of-way subject matter expertise and led the effort to score each alternative according to its complexity and feasibility . An alignment was selected, and RES will now support the Project Management Bureau in drafting the conceptual engineering report to refine the right -of- way needs and strategies.
After a project is designed and approved, right-of-way acquisition begins. RES performs all work related to acquisition, including obtaining title reports, preparing legal descriptions and plat maps, ordering and obtaining appraisals, drafting purchase agreements and deeds, preparing government code offer packages, meeting with property owners to make offers, negotiating offers, obtaining SFPUC Commission and Board of Supervisors’ approval, and coordinating and closing escrow.
FOLSOM AREA STORMWATER IMPROVEMENTS PROJECT
The SFPUC Folsom Area Stormwater Improvements Project reached the 100% design phase this year. The project relies on the acquisition of subsurface tunnel easements across three privately owned commercial parcels. The easements would also restrict the development of the parcels within a certain area around the proposed tunnel structure. Two of the three parcels contain large buildings with potential plans for future development that could be impacted by the easements.
RES worked with an appraiser and the property owners to assess the current use of the parcels and obtained appraisals for the val ue of the proposed easements. Upon receipt of the appraisal reports, RES drafted and compiled the necessary offer documents for government code offers and met with each property owner individually to present and discuss the offers. RES is currently awaiti ng a response to the offers from the property
1 A penstock is a sluice or gate or intake structure that controls water flow, or an enclosed pipe that delivers water to hydro turbines and sewerage systems. The term is inherited from the earlier technology of mill ponds and watermills.
19 owners and will consider counteroffers and negotiate as necessary to reach a settlement for compensation.
SFPUC USE OF OTHER CITY LAND
Many proposed or active capital projects involve the use of land under the jurisdiction of other City departments. For example, RES negotiated and executed a Memorandum of Understanding with the Recreation and Parks Department for the long- term use of property adjacent to the Westside Pump Station for new underground infrastruct ure installed as part of the Westside Pump Station Reliability Improvement Project.
Working with other City departments can be challenging, as each party needs to protect the operational use of its property. For instance, RES and the SFPUC project team are working with Recreation and Parks Department staff to negotiate a Memorandum of Understanding for the joint use of lands at South Ocean Beach for the Ocean Beach Climate Change Adaptation Project.
This project seeks to mitigate the effects of sea level rise at South Ocean Beach that threatens, both, critical wastewater infrastructure and the southernmost span of the Great Highway, a Recreation and Parks Department asset. The project would construct a protective buried wall parallel to the SFPUC Lake Merced Tunnel and would close the Great Highway south of Sloat Boulevard to vehicular traffic, establishing instead a public park in its footprint.
SFPUC and the Recreation and Parks Department each have jurisdiction over portions of the project area and a Memorandum of Understanding is needed to identify the lands and improvements of each department and how each will operate and maintain their respective improvements within the jurisdiction of the other department. RES seeks to reach an agreement that allows the project to proceed and accommodates the mission of each department.
SFPUC USE OF FEDERAL LAND
Finally, many SFPUC capital projects, including the Ocean Beach Project and the Seacliff 1 Pump Station and Force Main Upgrade Project, involve the use of federal lands under the jurisdiction of the National Park Service, through its Golden Gate National Recreation Area.
RES works with the Park Service to review and provide feedback during design phases and obtains the necessary right -of-way authorizations for project elements within Park Service lands. This year, RES and the Project Management Bureau, in coordination with the SFPUC’s Exter nal Affairs and Park Service staff, worked together to pass federal legislation sponsored by former Speaker Pelosi that will allow the Park Service 20 to grant easements to the SFPUC for proposed Ocean Beach Project improvements on Park Service land. RES is currently working with the Park Service to define the easement areas and draft the necessary agreements for the grant of easements.
The key capital projects in which RES is participating are described in the attached Project Appendix.
HETCH HETCHY WATER AND P OWER PROJECT S
Aerial view of Hetch Hetchy Village
The SFPUC’s Hetch Hetchy Water and Power Division reviews a diverse array of internal (SFPUC) and external (third- party) projects that range from small projects to large-scale and unique projects that require significantly more RES staff time. Hetch Hetchy Water and Power projects often involve additional coordination with multiple government agencies at the federal, state, and/or local level s. When a project proposal involves coordination with additional government agency stakeholders, each government agency may have to conduct its own review of the project , issue its own authorization agreement (e.g., a permit), and/or participate in the real estate
21 negotiations with the SFPUC. Th is additional coordination may add additional time to complete the review and authorization process es. The Hetch Hetchy Water and Power Division and RES , however, continue to coordinate to streamline and improve the Project Review process.
Please see the Project Appendix for a list of current Hetch Hetchy Water and Power projects.
PROTECTION OF SFPUC INFRASTRUCTURE AND LANDS
City staff continues to handle a large influx of proposed development projects impacting SFPUC lands and utilities. RES assists SFPUC colleagues with title research and real estate transactional document review and comment s during the development process.
RES also negotiates easements for SFPUC utilities not located in the public right of way.
IN-CITY PROJECT REVIEW COMMITTEE
RES leads and manages t he In- City Project Review Committee . This committee reviews project proposals initiated by third parties and other City departments that affect SFPUC infrastructure or use SFPUC Property located within the City and County of San Francisco.
The committee also reviews tentative subdivision maps, street and easement vacations, and sidewalk changes when requested by the San Francisco Public Works Bureau of Street-Use and Mapping. The committee meets on a bi -weekly basis to discuss the impact of the projects and their feasibility. RES staff review and comment on all projects and solicits input from other SFPUC enterprises to issue a single consolidated comment letter on behalf of the SFPUC for the proposed work.
In the past year , RES analyzed and commented upon 30 proposed projects at the following locations in San Francisco:
• 11 Frida Kahlo Way
• 30 Van Ness Avenue
• 130 Townsend Street
• 200 Rhode Island Street
• 400 China Basin Street
• 450 Powell Street
• 555 Bryant Street
• 700 Innes Avenue
22 • 755 Ocean Avenue
• 793 South Van Ness Avenue
• 811 Valencia Street
• 1039 Hudson Avenue
• 1550 Evans Avenue (Third-Party Air Quality Monitoring Devices) • 1570-1590 Pacific Avenue
• 1600 Holloway Avenue
• 1701 Jerrold Avenue (Cell Site Modifications)
• 1925 23rd Avenue
• 1990 Newcomb Avenue - Air Quality Monitoring Devices
• Buchanan Street Mall
• Caltrain - Southeast Rail Station Study
• Ellis and Gough Streets - Sidewalk Changes
• George Sterling Park and Lombard Reservoir - Private Excavation Proposal • Hummingbird Farm at the SFPUC Crocker Amazon Tract on Geneva Avenue • India Basin Park Development - Street and Easement Vacation • Parkmerced Phase 1C and 1D Street Vacation
• SFPUC Property at 207 Skyline Boulevard - Pomeroy Center Playground Expansion
• SFPUC Property at 207 Skyline Boulevard - Pomeroy Center A ccessible Parking Improvements
• Islais Creek Port Signage
• 3357 26th Street
• 24th and Tennessee Sidewalk Changes
NEW IN -CITY PROJECT REVIEW COMMITTEE
WORKFLOW AND DATABASE
RES worked with the SFPUC Information Technology Systems Division to develop a new web-based In-City Project Review Committee workflow and database. The In- City Project Review Committee web-based system replaces the former administration of the In-City Project Review Committee project comment system via email by creating a comprehensive online system with the same information accessible to staff in several SFPUC divisions.
23 THIRD- PARTY PROJECTS AND DEVELOPMENT OUTSIDE OF
SAN FRANCISCO
BAY AREA PROJECT REVIEW COMMITTEE
RES collaborates with SFPUC colleagues in several divisions to protect SFPUC assets outside of San Francisco. Through the SFPUC’s formal Project Review process, SFPUC staff reviews proposals for secondary uses of SFPUC Property in Alameda, Santa Clara, and San Mateo Counties. Staff from the Water Enterprise’s Natural Resources Land Management Division, Land Engineering, Water, Supply and Treatment Division, and RES determine whether a proposal is compatible with City and SFPUC-adopted plans and policies.
Consistent with the Land Use Framework approved by the SFPUC’s Commission via Resolution No. 12-0042 on March 13, 2012, the SFPUC may permit a secondary use on a SFPUC right -of-way only if it benefits the SFPUC, is consistent with the SFPUC’s mission and policies, and does not in any way interfere with, endanger, or damage the SFPUC’s current or future operations, security or facilities. No secondary use of SFPUC land is permitted without the SFPUC’s written consent.
As the land adjacent to the SFPUC pipeline right of way in the Bay Area continues to be redeveloped for denser suburban and urban uses, vacant space has grown more limited. Private parties and public agencies increasingly seek to use SFPUC Property for various uses. In particular, private developers and the cities of Santa C lara, Fremont, and Newark have proposed many recent projects on SFPUC lands. 24 The SFPUC authorized Google to perform work within Google’s easement on SFPUC Property in association with Google’s campus development in San Bruno
As an active participant in the Project Review process, RES reviews each application, analyzes any existing land rights in the proposed project area, and determines the appropriate real estate agreement in which to authorize the third- party use (lease, license, easement, or consent letter).
RES analyzed 88 projects in the fiscal year 2022-23. Of those 88 projects, RES reviewed and commented on (i) 16 projects from public agencies; (ii) six projects from private developers related to development projects; (iii) eight communications and utility installation projects; (iv) 40 PG&E projects; (v) six other private-party projects; and (vi) 12 internal SFPUC projects.
Many of these projects resulted in RES issuing a real estate license, consent letter, or other agreement for the use of SFPUC Property. Real property appraisals show that SFPUC Property usually increases in value as a result of these projects. The owners of adjacent redeveloped private p arcels seeking to use SFPUC Property often display significant resistance to RES’s efforts to meet the SFPUC’s obligation to charge fair
25 market value. RES staff often spends significant time negotiating rental rates for new real estate agreements.
INCREASED INTEREST IN THE USE OF SFPUC PROPERTY IN
ASSOCIATION WITH ACCESSORY DWELLING UNITS
The SFPUC receives inquiries for construction access and setback variances in conjunction with Accessory Dwelling Unit proposals on adjacent land.
California Government Code Section 65852.150 declared that allowing Accessory Dwelling Units (ADUs) in zoning areas that allow for single -family and multifamily uses is essential to help address California’s housing needs. The State ADU Law has since been revised to improve its effectiveness in creating more housing units.
Due to the changes in State ADU laws since 2021, the SFPUC has received an influx of requests from adjacent property owners seeking to use SFPUC Property to bypass local setback requirements and to use the SFPUC Property for access to the ADUs.
Additionally, the SFPUC receives proposals to use SFPUC Property for construction vehicle access related to the development of these ADUs.
RES works with colleagues from the Natural Resources and Land Management Division and the City Attorney’s Office to respond to these requests. In the past fiscal year, RES has received inquiries from adjacent private property owners in Redwood City, San Mateo County including, 2110 Hillcrest Road, 711 Esther Lane, and 315 St. Francis as
26 well as 439 Walsh Road in Atherton. RES also supports the Natural Resources and Lands Management Division in responding to environmental impact reports related to ADU development in local municipalities.
PROPOSED LAND USE POLICY UPDATE
The SFPUC Commission approved land use policies such as the Land Use Framework in 2012 and the Real Estate Guidelines in 2015 to manage the Bay Area right of way .
RES will welcome a San F rancisco Fellow in September 2023. RES will partner with the new fellow and colleagues from the Natural Resources and Lands Management Division, the Water Supply and Treatment Land Engineering and Operations Divisions, External Affairs, and the City Attorney’ s Office to refresh the land use policies presenting them to the Executive Team for approval.
While the updated policies will improve management, staff recommend that the SFPUC consider the development of a Right of Way Management Plan to further provide analysis and background on the current standards for best management practices. This effort would likely require the use of SFPUC staff and consultants, an Environmental Impact Report, and community outreach to develop, analyze, and implement the plan.
27 PACIFIC GAS AND ELECTRIC COMPANY (PG&E) PROJECTS
PG&E literature on its current program to remove vegetation according to CPUC and Cal Fire requirements for “Extreme Fire Threat Tier 3”.
As part of its ongoing plan to accommodate new, more stringent safety and performance requirements in the wake of the Northern California wildfires, PG&E continues to request SFPUC approval for a variety of projects. These projects include (i) large-scale vegetation management initiatives related to power transmission and distribution rights; ( ii) gas pipeline inspection, replacement, installation, and retirement projects; and (3) electric transmission and distribution line inspection, pole and tower repair, and replacement, and reconductoring projects.
In the past fiscal year, the SFPUC issued 17 agreements (revocable licenses, work authorization letters, and consent letters), for new and existing PG&E projects. SFPUC and PG&E staff continue to meet regularly to discuss pending and new projects and make process improvements to accommodate PG&E’s critical work. A list of real estate agreements issued to PG&E in the last fiscal year is attached as Exhibit D.
28 OTHER KEY INITIATIVES
BISECTED ENCROACHMENT PERMITS
In certain areas, the SFFPUC right-of-way bisects adjacent parcels . These adjacent parcels would have limited access and utility, and in some cases, the adjacent parcels may be landlocked, without the owners having the right to use SFPUC Property.
SFPUC Right of Way bisecting the backyards of adjacent property owners in Redwood City A SFPUC Encroachment Permit allows an adjacent residential property owner (the permittee) to access and use a portion of the adjoining SFPUC Property as part of the permittee’s yard or driveway.
The SFPUC issues Encroachment Permits to adjacent property owner s for a five-year renewable term. The permittee must pay an annual fee, maintain sufficient insurance to indemnify the City , and maintain the portion of SFPUC Property the permittee is using.
RES currently manages 110 active fee-based Encroachment Permits in Alameda, San Mateo, and Santa Clara Counties.
RES issued five Encroachment Permits in the last fiscal year.
29 NEW ENCROACHMENT PERMIT DATABASE
In the fall of 2022, RES staff identified a need to compile Encroachment Permit agreements and permittee billing, insurance, and other critical information , in one common system accessible to both RES and other SFPUC staff.
RES worked with the SFPUC Information Technology Systems Division to develop a new web-based Encroachment Permit Database. The Encroachment Permit Database replaces the former administration of the Encroachment Permits on separate spreadsheets by creating a comprehensive database with the same inf ormation provided in one common and accessible location.
The Encroachment Permit Database presents the various information in an organized and concise way, while also allowing authorized staff the ability to run a wider variety of reports. The Encroachment Permit Database is in its final test phase and the l ive version should be available for staff use by September 2023.
30 PROJECT APPENDIX
CURRENT WATER SYSTEM IMPROVEMENT PROJECT LIST
Regional Groundwater Storage and Recovery Project, Phase I and Phase II – This ongoing project seeks to continue building groundwater facilities in San Mateo County to fulfill the goal of diversifying the SFPUC’s regional water supply for drought protection. RES is currently:
1. working with San Mateo County to record a Record of Survey that accurately reflects SFPUC Parcel 17;
2. acquiring two aerial electrical easements across private property for PG&E to serve the sampling station on SFPUC Parcel 17;
3. acquiring a proposed access driveway and easement from BART on Mission Road for the SFPUC’s groundwater well station;
4. negotiating with BART, South San Francisco, and a private developer for temporary access rights and permanent access easements for the groundwater well station near Antoinette Lane in South San Francisco;
5. negotiating with Kaiser Hospital to purchase new easements for a utility vault and water, electrical, and communications lines, as well as a temporary construction easement to install them, related to the groundwater well station near Antoinette Lane;
6. appraising and acquiring an aerial easement and two footing easements for a pipeline across San Mateo County Flood Control property;
7. negotiating a license with South San Francisco for a proposed staging area on South San Francisco property near Chestnut Avenue; and
8. exploring locations for the installation of additional groundwater well sites for Phase II of the project.
CURRENT OTHER WATER ENTERPRISE CAPITAL PROJECT LIST • Auxiliary Water Supply System – The Auxiliary Water Supply System is an independent high-pressure, non-potable, water supply system built following the 1906 earthquake and dedicated to fire protection. The Auxiliary Water Supply System mainly serves the northeastern portion of the City. RES continues to support the project team in its efforts to improve the Auxiliary Water Supply System at various locations. Most recently RES assisted the project team in obtaining a second Special Use Permit with the National Park Service for the Auxiliary Water Supply System Pumping Station No. 2 at the Presidio. Currently, RES is assisting with plans to install fireboat manifolds at Fort Mason on land
31 under the jurisdiction of the Golden Gate National Recreation Area and at Piers 20 and 35.5 on land under the jurisdiction of the Port.
• Bay Division Pipeline Nos. 3 and 4 Crossover Project – RES is working with the Veterans’ Administration Hospital in Palo Alto to acquire an access easement for permanent access for the SFPUC Crossover facility that runs through the Veteran’s Administrat ion Hospital campus. In addition, the Veteran’s Administration has required the removal of a communication line installed during the Water System Improvement Project that is no longer needed. RES is coordinating that effort.
• Bay Division Pipeline Nos. 3 and 4 Valve Lots Safe Pipe Entry – RES is working with the project team to develop the Conceptual Engineering Report . Once done and the design is complete, RES will acquire the necessary right -of-way authorizations to construct the project.
• Corrosion Protection Capital Upgrades Phases I, II, and III – RES is working with the SFPUC project team to analyze proposed locations for the installation of cathodic protection improvements on the SFPUC pipeline right of way . RES will acquire utility easements and temporary construction easements, as and where needed, for the improvements and for the installation of electrical supply lines needed to power the improvements. In August 2021, RES acquired a Temporary Construction Easement on Stanford University prop erty for staging related to the location at Quarry Drive and El Camino Real in Santa Clara County.
• Crystal Springs Pipeline No. 2, Reach 5 Relining – RES is working with the project team to reclaim portions of the pipeline right of way for project construction. The Crystal Springs Pipeline No. 2 Reach 5 Project would re-line a
3.84-mile segment of Crystal Springs Pipeline No. 2 . The project would require access pits at multiple locations, as well as construction of new manholes and modification or relocation of pipeline appurtenances. The project is currently in the design phase. The anticipated right-of-way needs include locating temporary space on SFPUC Property or within the public right -of-way for temporary equipment laydown and staging, negotiating memoranda of agreements with impacted municipalities for project implementation, and clearing the right -of-way of significant encroachments along residential stretches of the right -of-way. RES is currently meeting with each property owner impacted by the project construction to present and discuss the project and communicate the SFPUC’s requirement that encroachments be removed by the property owners before August 2024.
32 • Crystal Springs Pipeline No. 2, Reaches 2 and 3 Re- Lining – This project would rehabilitate Reaches 2 and 3 of Crystal Springs Pipeline No. 2 by replacing a portion of the pipeline within a new alignment, and re- lining the rest. The project would require access pits at multiple l ocations, as well as construction of new manholes and modification or relocation of pipeline appurtenances. The project is currently in the design phase. The anticipated right -of-way needs include (i) acquiring easements for the portions of the new pipeline that would cross private property; (ii) locating temporary space on SFPUC Property or within public right - of-way for temporary equipment laydown and staging; and (iii) negotiating memoranda of agreements with impacted municipalities for project implementation.
• Millbrae Yard Lab and Shops Improvements Project – This project would redevelop the Millbrae Yard over multiple phases. RES support for the project to date has included extensive research related to existing historic easements and agreements on the multiple parcels that comprise the Millbrae Yard, assisting with obtaining an accurate ALTA survey for the project site from the City’s Bureau of Streets and Mapping, and coordinating with the existing tenants to perform geotechnical investigations. Antic ipated future RES support will mainly include coordination with the existing tenants and easement holders to implement the project.
• Moccasin Penstocks Rehabilitation Project – This project is in the Conceptual Engineering Phase. RES is working with the pr oject team to assess the right -of- way needs for the project. Anticipated future work includes (i) acquiring special use permits from the Bureau of Land Management for necessary access road improvements; (ii) acquiring a temporary construction easement on private property for access during construction; and (iii) coordinating with Caltrans to define its Highway 49 right -of-way where it crosses SFPUC lands; (iv) and obtaining an encroachment permit from Caltrans to allow for new access to the project area from Highway 49.
• Potable Emergency Firefighting Water System – This proposed system is related to the Auxiliary Water Supply System. The proposed sys tem will serve the west side of the City and will be connected to the drinking water system, using a system of valves that can be closed, when needed, to function at the high pressure required for firefighting. RES will negotiate any necessary agreements with other Cit y departments to install pipelines for the new system through City property (i.e., Stern Grove and Golden Gate Park).
33 • Southern Skyline Boulevard Ridge Trail Extension – This project would construct approximately six miles of multi -purpose trail generally following Skyline Boulevard (State Route 35) from State Route 92 to the southern boundary of the Peninsula Watershed at the Phleger Estate. New improvements would overlap with the State Route 35 right of way at 18 locations. RES support for this project has included a significant amount of historical research, production of right of way maps, and ongoing discussions with Caltrans to facilitate the project team’s efforts to obtain an encroachment permit and freeway maintenance agreement.
The freeway maint enance agreement requires Board of Supervisors’ approval.
RES has supported the SFPUC project manager to draft the necessary staff reports and will help obtain Board approval in October 2023. RES will also work to assume the existing easement across the Skylawn Memorial Park. The easement is currently owned by the Bay Area Ridge Trail Council.
• Town of Sunol Pipeline Replacement Project – This project seeks to replace a portion of the Sunol Pipeline where it crosses Laguna Creek and the Sunol Glen School. RES will negotiate a new easement for the new pipeline alignment and appurtenant facilities on and across the school property, as well as temporary construction easement(s) on the school property.
CURRENT NON- SSIP WASTEWATER ENTERPRISE CAPITAL PROJECT LIST • Ocean Beach Climate Change Adaptation Project – This project focuses on alleviating chronic shoreline erosion at Ocean Beach between Sloat Boulevard and Fort Funston. Project elements include managed retreat, beach nourishment through the placement of sand, construction of a buried wall to protect the Lake Merced Tunnel, beach access and recreation improvements, and permanent closure of the Great Highway Extension. RES support for this project involves working with the National Park Service to obtain easements for the project components on Golden Gate National Recreation Area lands and working with the Recreation and Parks Department to negotiate a Memorandum of Understanding to govern the respective responsibilities and obligations of each department for the various improvements installed on the Recreation and Parks Department lands as part of the project.
• Presidio Trust 50-Year License for SPUC sewer infrastructure within the Presidio - RES is negotiating with the Presidio Trust for a new 50- year replacement license that will allow the SFPUC sewer facilities to continue to operate on Trust property.
34 • Treasure Island Wastewater Treatment Plant – This project will construct the new wastewater treatment plant, wetlands treatment area, and recycled water facilities necessary to support the redevelopment of Treasure Island. The land on which the new facilities will be constructed is under the jurisd iction of the Treasure Island Development Authority, as trustee of the public trust administered by the State Lands Commission.
Because the wastewater treatment plant is not an allowable use of trust lands, TIDA is working with the State Lands Commission to execute a trust exchange agreement that would unencumber the wastewater treatment plant parcel. Once the trust exchange is complete, the Treasure Island Development Authority will:
(i) quitclaim the wastewater treatment plant parcel to the SFPUC, (ii ) convey a 66-year lease for the use of an adjacent parcel for the wetlands treatment area, and (iii) convey an easement for a discharge pipeline to the San Francisco Bay.
RES has been coordinating monthly meetings with the project team, City Attorney’s Office, TIDA, and TIDA counsel to move the real estate items forward.
All real estate items are expected to be approved and completed by October 2023.
CURRENT SSIP PROJECT LIST
• Mariposa Street Dry-Weather Pump Station and Force Main Improvements Project – Under Resolution No. 17 -0253, the General Manager executed a Memorandum of Understanding with the Port to reconstruct the Mariposa Pump Station. At that time, the SFPUC also entered into a su blease with the Port’s tenant, the St. Francis Marine Center, for the use of property adjacent to the pump station. In 2019, the SFPUC negotiated a second Memorandum of Understanding with the Port for the use of a portion of Terry Francois Boulevard for t emporary construction staging. The Mariposa Dry -Weather Pump Station Project was completed in Spring 2023 and is in the close-out phase. • Channel Force Main Intertie Project –This project has begun. The SFPUC will construct an intertie between the Channel Force Main and the Islais Creek Transport/Storage Box, providing a bypass that will allow the Wastewater Enterprise to inspect and rehabilitate approximately 2,500 linear feet of the Channel Force Main. The intertie will be constructed within the public right of way at the intersection of Cesar Chavez and Indiana Streets. It will connect the Channel Force Main to the Islais Creek Transport/Storage Box within the adjacent SFMTA bus yard.
35 RES negotiated an agreement with the SFMTA providing for project construction, temporary laydown, and access to shut -down valves within the bus yard. The project contractor will also require access through an existing access panel within an SFPUC easement on property owned by Caltrain. Caltrain is storing a significant amount of dirt over the SFPUC easement, blocking access. RES is leading the effort to have Caltrain remove the dirt and restore access. • Folsom Area Stormwater Improvement Project – This project proposes to manage stormwater and minimize flooding through the integration of “Green” and “Grey” infrastructure including upsizing and deepening existing sewer structures and constructing new sewer components to improve conveyance and flow distribution. RES is working to obtain permanent tunnel easements across three privately owned commercial parcels. Additionally, RES is negotiating with Caltrans for the use of a Caltrans right-of-way for a launching shaft and staging area. RES will obtain a Caltrans air space lease for the temporary staging area. • Lower Alemany Stormwater Improvement Project – This proposed project is currently in the design phase . The SFPUC proposes to bore a 5,650- foot-long 10-foot-diameter tunnel to alleviate flooding and improve flood resilience in the Lower Alemany Boulevard area. RES has been working with the project team to evaluate the right-of-way needs related to the selected alternative. RES support for the project would include the acquisition of tunnel easements across and below three residential and two commercial par cels. RES would also work to identify and acquire temporary construction easement(s) for laydown and staging.
• Seacliff No. 1 Pump Station and Force Main Upgrade Project – This project would replace the existing Seacliff Pump Station No. 1 in a new locati on. The current location of the pump station is a landlocked SFPUC -owned parcel at China Beach. The topography of the area and the landlocked nature of the SFPUC parcel led to the decision to relocate the pump station within the public right-of-way at the end of Seacliff Avenue. RES support for this project includes coordinating the effort to obtain Special Use Permits from the National Park Service, through Golden Gate National Recreation Area, for the necessary access to decommission the existing pump s tation and for the long- term placement of electrical cabinetry on Golden Gate National Recreation Area property. Additionally, RES is helping to obtain a temporary construction easement on private property, adjacent to an SFPUC easement, to perform the necessary work on the facilities within the easement.
36 • Westside Pump Station Reliability Improvements Project – This project is in construction and will improve and modify the aging mechanical and electrical infrastructure at the SFPUC’s essential primary was tewater pump station servicing the west side of the City. To construct the project, the SFPUC secured a temporary staging area on the adjacent Recreation and Parks Department property leased to the San Francisco Zoological Society. Additionally, RES negotiated and executed a Memorandum of Understanding with the Recreation and Parks Department for certain permanent project components that will encroach onto the Recreation and Parks Department property.
CURRENT POWER ENTERPRISE CAPITAL PROJECT LIST
• Bay Corridor Transmission and Distribution – RES continues to support the SFPUC project team in its efforts to build a proposed electrical distribution system in the southeast portion of San Francisco that will allow the SFPUC to serve customers from its own distribution system.
PUC/Port Northern Waterfront Electrification Project – The SFPUC and Port seek to increase the SFPUC’s capacity to provide power to Port operations. SFPUC and Port staff are working together to identify Port property on which the SFPUC could design and construct electrical infrastructure for the benefit of the Port’s maritime operations.
HETCH HETCHY WATER AND POWER CURRENT PROJECT LIST
• Verizon Cell Site Modifications and Lease Renewals – The SFPUC and Verizon successfully negotiated and executed an 8- year communications site lease for Verizon’s use of the SFPUC’s Moccasin Surge Tank. Verizon continues to work with Hetch Hetchy Water and Power and RES to install or upgrade communications facilities at other locations on SFPUC Property . RES staff and Verizon are currently negotiating a new lease for the Early Intake/Intake Ridge site. In addition, RES will be subleasing space on its towers located on f ederal property at Poopenaut Pass and Burnout Ridge. Verizon anticipates performing the work immediately upon execution of the leases, which will require Commission approval.
• Consent Letters for Irrigation Line Crossings – In San Joaquin and Stanislaus Counties, the SFPUC Right of Way runs through miles of land used primarily for agriculture. The deeds for these parcels often reserve the right to cross SFPUC Property with irrigation lines, for which the SFPUC issues a consent letter . This
37 is one of the more common types of projects reviewed by Hetch Hetchy Water and Power and RES staff.
• Modesto Memorandum of Agreement (MOA) – RES is working with the City of Modesto to draft and execute an MOA that outlines various projects and considerations that benefit the SFPUC and Modesto. The MOA contemplates projects proposed by Modesto on SFPUC Property, including the Claratina Avenue Road Widening project (more information below) across SFPUC Property and a proposed bicycle path extension along SFPUC Property. The SFPUC is working with Modesto to protec t the SFPUC’s access to its infrastructure.
• Claratina Avenue Crossing Road Widening –Modesto has initiated the process of widening Claratina Road, which crosses over SFPUC Property. Modesto is working with Hetch Hetchy Water and Power and RES staff to obtain a license to perform the work and operate and maintain the new road. RES is working with the City Attorney’s Office to draft quitclaim deeds to be executed by three adjacent landowners whose reserved crossover rights will be impacted by the project. Similarly, PG&E will seek a license to relocate two gas transmission lines and appurtenant service lines as a result of this project. • Hetch Hetchy Railroad Underutilized Property/Potential Surplus Property Sale – The SFPUC owns former Hetch Hetchy right -of-way way parcels in Tuolumne County. The City constructed the now -defunct railroad to support the construction of the O’Shaughnessy Dam many years ago. The existing 19 remnant parcel ed parcels of the former Hetch Hetchy Railroad are either landlocked, non-contiguous, and/or Groveland Community Services District subsurface sewer main are located under the parcels. The Groveland Community Services District desires to acquire the parcels from the SFPUC to ensure its use of the sewer main and other utility facilities and to develop a recreational trail on most of the parcels as an alternative to State Route 120. The Groveland Community Services District signed a Letter of Intent to commence negotiations with the SFPUC for the sale of the former railroad parcels , and the State of California Housing and Community Development Department tentatively agreed with the SFPUC analysis that the former railroad parcels may be considered “exempt surplus” land and would not be subj ect to most provisions of the State Surplus Lands Act (HCD will make a formal determination when more transaction details are available).
38 • Stanislaus County (in coordination with Caltrans) North County Corridor (NCC) Project – Phase 1 State Route 108 Expressway Project – Please see the earlier discussion in this report.
• Federal Highway Administration and Tuolumne County Evergreen Road Widening – Hetch Hetchy Water and Power and RES are working with the Federal Highway Administration and Tuolumne County on their project to widen Evergreen Road, a portion of which runs through SFPUC Property . Tuolumne County agreed to the terms of the purchase and sale agreement to purchase a road easement from the SFPUC and paid the General Plan Refer ral fee. RES continues to work with Federal Highway Administration and Tuolumne County to finalize the sale of the easement for Evergreen Road, which needs Commission and Board of Supervisors approval next year. Tuolumne County anticipates breaking ground for the project next year.
• Hetch Hetchy and Upcountry Cottage Leases – RES staff continue to draft new cottage leases for Hetch Hetchy Water and Power and federal agency staff tenants. The SFPUC presently has 43 cottage tenants in Moccasin and in the greater “Upcountry” area of the Tuolumne Watershed. A total of five cottage leases were issued in the past year.
39 EXHIBIT A
REAL ESTATE LEASE AND LICENSE REVENUES FY 2022- 2023
Enterprise Fiscal Year 2022-2023
Wastewater $660,183.90
Hetch Hetchy Water and Power $76,969.77
Water $13,431,455.39
Total $14,218,619.06
EXHIBIT B
SFPUC PROPERTY TAXES AND ASSESSMENT PAYMENTS PAID IN FY 2022- 2023
County Fiscal Year 2022-2023
Alameda $1,054,445.88
San Francisco $41,067.60
San Mateo $787,016.32
Santa Clara 306,198.26
San Joaquin $4,713.16
Stanislaus $17,508.64
Tuolumne $579,087.38
Total $2,790,037.24
40 NEW REAL ESTATE LEASES AND LICENSES ISSUED IN FY 2022- 2023
County Commencement
Date
Licensee Use Use Fee Annual
Rent /
One-
Time
Payment
Santa
Clara
7/1/2022 MCI Metro
Access
Transmission
Services LLC
Fiber Optic Cables $3,993.60 Annual
Alameda 7/1/2022 Richard
Mendoza
Cattle Grazing $13,821.60 Annual
Tuolumne 7/6/2022 Pinnacles
Cellular, Inc.
Wireless Communication Site $8,112.00 Annual
San
Mateo
7/25/2022 PG&E Equipment Staging, Parking, and 6
Bell Hole Drilling
$13,750.00 One-
Time
San
Francisco
8/6/2022 Wu Yee
Children’s
Services
Daycare Facility $1.00 Annual
Santa
Clara
9/1/2022 Deerfield
Patrick Henry
LLC
Parking & Landscape $24,960.00 Annual
Stanislaus 9/8/2022 PG&E Electrical Transmission Line, Parking and Ingress and Egress
$3,744.00 Annual
San
Mateo
10/1/2022 Filoli Center Pump Station and Water Pipeline $2,400.00 Annual San
Francisco
10/1/2022 Office of
Civic
Engagement
& Immigrant
Affairs
Work Stations and Locker Room N/A N/A
Alameda 10/7/2022 BBG KRG,
Inc.
Groundwater Wells $136.00 Annual
Alameda 10/18/2022 SFPP, L.P. Staging and Construction and Maintenance of Ramp
$238.00 One-
Time
Alameda 11/1/2022 Fields
Livestock
Cattle Grazing $52,052.50 Annual
Santa
Clara
12/28/2022 City of Los
Altos
Bicycle Path & Landscaping N/A N/A
Santa
Clara
1/1/2023 Bandwidth
Infrastructure
Group CA
Subsurface Utility Installation,
Conduit
$3,504.00 Annual
41 County Commencement
Date
Licensee Use Use Fee Annual
Rent /
One-
Time
Payment
San
Mateo
1/1/2023 PG&E Parking and Staging, 3 Bell Holes,
and 4 Trenches
$2,400.00 One-
Time
San
Francisco
1/24/2023 Girl Scouts of
Northern
California
Facility, Shelters, and Campfire
Circles
N/A N/A
San
Francisco
1/26/2023 Hungry
Kitchens LLC
Café $700.00 Annual
Alameda 2/1/2023 Bandwidth
IG, LLC
Fiber Optic Conduit $19,200.00 Annual
San
Mateo
3/1/2023 PG&E Parking, Staging, Vegetation
Management and 5 Bell Holes
$2,400.00 One-
Time
San
Francisco
3/9/2023 En2action,
Inc.
Youth Center and Office Workstation $56,496.00 Annual
San
Francisco
3/15/2023 Charity
Cultural
Services
Center
Office Workstation $10,488.00 Annual
San
Mateo
3/15/2023 PG&E Staging Area and Bell Holes $24,000.00 One- Time
San
Francisco
4/1/2023 New Cingular
Wireless
PCS, LLC
Telecommunications Site $91,261.32 Annual
Alameda 4/1/2023 New Cingular
Wireless
PCS, LLC
Telecommunications Site $63,606.24 Annual
San
Francisco
4/12/2023 Five Keys
Schools and
Programs
Office Workstation $5,244.00 Annual
San
Francisco
4/12/2023 Five Keys
School and
Programs
Youth Development Center $53,844.00 Annual
San
Joaquin
4/21/2023 John Roberts
Myers
Cottage Tenant $10,631.28 Annual
San
Francisco
5/15/2023 3rd Street
Youth Center
& Clinic
Youth Development Center $45,648.00 Annual
San
Mateo
5/15/2023 PG&E Staging, Trail Maintenance, and Bell
Holes
$1,200.00 Annual
San
Mateo
6/1/2023 Intermountain
Infrastructure
Group LLC
Fiber Optic Conduit Crossing $10,560.00 One-
Time
San
Francisco
6/22/2023 SPRO LLC Café $36,000.00 Annual
42 County Commencement
Date
Licensee Use Use Fee Annual
Rent /
One-
Time
Payment
Alameda 6/26/2023 State of
California
(Caltrans)
Access and 12 Inch Culvert $6,292.00 Annual
Santa
Clara
6/27/2023 Bandwidth
IG, LLC
Conduit and Fiber Optic $1,920.00 One-
Time
43 ENCROACHMENT PERMITS ISSUED IN FISCAL YEAR 2022 - 2023
County Commencement Date Permittee Annual Use Fee
San Mateo 7/16/2022 Preeti Bali Tikekar and
Sudhanshu Sudhakar
Tikekar
$ 125.00
San Mateo 11/24/2022 Ramsey Nissan and
Yesenia Perez
$ 125.00
San Mateo 12/18/2022 Tianjun Ma and
Regina Wai Sung Tse
$ 125.00
San Mateo 3/10/2023 Heather and
Nikolaus Woloszczuk
$ 125.00
San Mateo 5/17/23 Barry Rafferty and
Meghan O’Reilly-Green
$ 125.00
44 EXHIBIT C
LIST OF CURRENT AGREEMENTS WHERE THE SFPUC PAYS RENT
Landlord Property
Address
Premises
(in square
feet)
Type/Use Start Date End Date Annual Rent
1880 Jerrold Ave LLC 1876 Oakdale
Avenue, San
Francisco
25,937 Staging and
Temporary Storage
of Materials for
Disposal for CDD
10/1/2018 9/30/2026 $189,600.00
2725 Oakdale LLC 2725 Oakdale
Avenue, San
Francisco
46,442 Wastewater
Enterprise
Warehouse and
Parking
6/1/2019 5/31/2028 $932,340.84
Raul and Denise Arriaza;
and Linda and Carl Olson
1325A Evans
Avenue, San
Francisco
3,287 Health and Safety
Division Offices
1/1/2019 12/31/2026 $121,881.96
Executive Park Properties
LLC
150 Executive
Park Blvd., Suite
1300, San
Francisco
4,164 Office for
Contractor's
Assistance Center
2/1/2021 1/31/2025 $149,904.00
544 Golden Gate
Associates LLC
544 Golden Gate
Avenue, San
Francisco
6,888 Office 3/1/2019 After holding
over after
2/28/2023, the
lease was
terminated on
8/21/23.
$393,801.36
Bayview Plaza, LLC 3801 Third Street,
Suite 600, San
Francisco
10,740 Wastewater
Enterprise Offices
7/1/2021 6/30/2024 $412,189.56
City of Hayward - Hayward
Executive Airport
22488 Skywest
Drive (Hayward
Executive
Airport), Hayward
24,974 Ground Lease for
Pump Station
1/1/2005 12/31/2054 $4,008.33
Kristian A. Akseth, Lilly B.
Akseth, and Libkra
Investments
1980 Oakdale
Avenue, San
Francisco
36,400 Warehouse and
Parking
2/1/2017 12/31/2022 $1,024,054.20
45 Landlord Property
Address
Premises
(in square
feet)
Type/Use Start Date End Date Annual Rent
Filoli Center Filoli Center,
near Cañada
Road, Woodside
10,323,720 Watershed
Protection
12/1/1982 11/30/2022, in
month-to-
month
holdover
$1.00
Communication & Control,
Inc. - Livermore Hills
Livermore Hills
near Morgan
Territory Road,
unincorporated
Contra Costa
County
APN#: 006-070-
021
Two (2) 6-
foot dishes
and shelter
space
Communications
Site - Antennas,
Microwave, and/or
Radio
12/1/2022 11/30/2027,
with three (3)
more 5-year
extension
options
$19,458.72
Communication & Control,
Inc. - Mt. Allison
Mt. Allison,
unincorporated
Alameda County
APN#: 096-0090-
005-07
6-foot dish
and shelter
space
Communications
Site - Antennas,
Microwave, and/or
Radio
5/1/2020 4/30/2025,
with two (2)
more 5-year
extension
options
$64,626.48
Vertical Bridge 32322 Corral
Hollow Road,
Tracy
345 Communications
Site - Antennas,
Microwave, and/or
Radio
1/1/2023 1/1/2028, with
four (4), 5-
year
extension
options
$30,000.00
Alameda County Sunol Ridge
37000 Palomares
Road, Sunol
N/A Communications
Site - Antennas,
Microwave, and/or
Radio
11/1/2020 10/31/2025 $41,620.00
Alameda County Crane Ridge
14300 Mines
Road, Livermore
N/A Communications
Site - Antennas,
Microwave, and/or
Radio
11/1/2020 10/31/2025 $31,464.00
American Towers LLC 300 Radio Road
(San Bruno
Mountain), Daly
City
N/A Communications
Site - Antennas,
Microwave, and/or
Radio
8/1/2017 7/31/2024,
with three (3)
more 5-year
extensions
$30,930.60
Joaquin Bear, LLC Cedar Ridge
16601 White
Fang Drive,
Sonora
N/A Communications
Site - Antennas,
Microwave, and/or
Radio
10/1/2020 9/30/2028 $30,959.16
46 Landlord Property
Address
Premises
(in square
feet)
Type/Use Start Date End Date Annual Rent
Crown Castle (formerly
TriStar Investors LLC)
2201 Blue Gum
Avenue, Modesto
N/A Communications
Site - Antennas,
Microwave, and/or
Radio
11/1/2020 10/31/2025,
with three (3)
more 5-year
extension
options
$22,875.60
Port Pier 23 87,363 Shed, Storage, and
Parking for Power
Enterprise
5/1/2020 11/30/2026 $1,890,185.40
Port Roundhouse Two
Building - Seawall
Lot 318
10 Lombard
Street
7,350 Offices for Power
Enterprise
5/1/2020 11/30/2026 $409,608.72
Port Shed at Pier 33
(between Bays
20-26)
3,440 Shed, Trailer
Storage, and
Parking for
Customer Service
Bureau
8/1/2020 7/31/2025 $72,240.00
SFPUC Rental
Agreements:
20 $ 5,871,749.93
47 EXHIBIT D
AGREEMENTS ISSUED TO PG&E FY 2022- 2023
PG&E Project Title Agreement
Date
Agreement Type
PG&E - B-Tag Anchor Replacement near Pulgas Water
Temple
8/3/2022 Consent Letter
PG&E - D-1495A Crystal Springs Station 9/15/2022 Work Authorization Letter
PG&E - Vegetation Management Alameda Watershed -
Pittsburg-Tesla 230kV
9/29/2022 Consent Letter
PG&E - Request for Extension to P4525 (PG&E T-
1564AB) (San Mateo County)
10/21/2022 License Amendment
No. 1
PG&E - Request for Extension to P4526 (San Mateo
County)
10/21/2022 License Amendment
No. 1
PG&E - Ravenswood-Cooley Tower Repairs (Menlo
Park)
10/11/2022 Work Authorization
Letter
PG&E -Vegetation Management Upper/Lower Crystal
Springs and San Andreas Reservoirs
11/4/2022 Consent Letter
PG&E - R-1462 (P4555) (Half Moon Bay) 11/16/2022 License PG&E - Tower Painting Ravenswood (East Palo Alto) 11/22/2022 Work Authorization Letter
PG&E - B-Tags Alameda County 11/30/2022 Consent Letter
PG&E - B-Tags San Mateo County 11/30/2022 Consent Letter PG&E V-925 Ralston Station Valve Replacement - San
Mateo
2/8/2023 Work Authorization
Letter
PG&E L-109 Strength Test T-1574 - San Mateo 2/17/2023 License PG&E VM San Antonio Creek Reservoir 2022 - Alameda 3/13/2023 Consent Letter PG&E T-1574B L-109 Hydrostatic Strength Test - San
Mateo
3/21/2023 License
PG&E SCADA Install Larkspur Millbrae - San Mateo 3/28/2023 Work Authorization Letter
PG&E B-Tag Elec Ala & Pen WS Jan 17-Mar 1, 2023 3/29/2023 Work Authorization Letter and Consent
Letter
PG&E Newark Lawrence Lab 115kV Circuit Removal -
Sunol
4/4/2023 Work Authorization
Letter
PG&E E-Tags Pen-Ala WS March-July 2023 4/18/2023 Work Authorization Letter and Consent
Letter
48 PG&E Project Title Agreement
Date
Agreement Type
PG&E VM Upper Lower Multi-Circuit 12kV CEMA - San
Mateo
5/3/2023 Consent Letter
PG&E D-1423K ID-590G L-132 Repairs Canada Road -
San Mateo
5/4/2023 License
PG&E VM Millbrae 1104 12kV Harry Tracy Water Plant
Routine 2023
5/5/2023 Consent Letter
PG&E E-Tags Batch 4 Alameda and Peninsula
Watersheds
5/18/2023 Work Authorization
Letter and Consent
Letter
PG&E T-1930 L-109 Hydrostatic Test Ralston Station -
San Mateo
5/19/2023 Work Authorization
Letter
PG&E VM Jefferson Hillsdale 60kV Routine - San Mateo 5/24/2023 Consent Letter PG&E Stanislaus-Newark 1&2 115kV Circuit Removal -
Sunol
6/5/2023 Work Authorization
Letter
PG&E I-447C L-109 San Andreas Station Crosstie ILI
Receiver - San Mateo
6/8/2023 Amendment No. 1 to
License
PG&E VM San Carlos 1104 Bay Division Pipeline ROW
- San Mateo
6/9/2023 Consent Letter
PG&E VM San Antonio Reservoir Sunol 12kV 6/12/2023 Consent Letter PG&E E-Tags Batch 6 Alameda and Peninsula
Watersheds
6/23/2023 Work Authorization
Letters (2)
PG&E VM Access Trail Maintenance Jefferson Hillsdale
Tower 004/023 - San Mateo
6/27/2023 Work Authorization
Letter
PG&E Tesla-Newark#2 Transmission Tower Painting -
Sunol
6/30/2023 Amendment No. 1 to
Work Authorization
Letter
PG&E VM Jefferson Martin 230kV NERC 2023 - San
Mateo
7/7/2023 Work Authorization
Letter
PG&E C-1795 Arc Fault Mitigation Calaveras Rd - Sunol 7/19/2023 Work Authorization Letter
PG&E TRP Newark-Livermore 60kV Calaveras Road -
Sunol
7/21/2023 Work Authorization
Letter
PG&E Access Road Maintenance Los Esteros Metcalf -
Sunol
7/31/2023 Work Authorization
Letter
PG&E Pole Replacement Milpitas 1109 35451727 -
Santa Clara
8/18/2023 Consent Letter
PG&E VM Lower/Upper Crystal Springs San Andreas
Reservoirs - San Mateo
8/18/2023 Amendment No. 2 to
Consent Letter