Nikolai J. Sklaroff
Capital Finance Director
September 10, 2024
Interim Financing Program Expansion
Purpose
• Approve the expansion of the Wastewater, Water, and
Power Enterprise Interim Funding Programs (“Programs”)
from $750 million, $500 million, and $250 million to not- to-exceed aggregate principal amounts of $1.25 billion, $750 million, and $450 million, respectively; and
authorize the General Manager or designee to prepare
and introduce an ordinance with the terms described here for adoption by the Board of Supervisors and approval by the Mayor.
• No change is proposed to the debt authorization already authorized by the Board of Supervisors and Commission
2 Agenda
• Fiscal Year 2024-25 Capital Financing Plan
• Current Interim Funding Programs
• Interim Funding Program Expansion Sizing
• Recommended Commission Action
• Interim Funding Program Expansion Process
3 Capital Financing Plan
(Fiscal Year 2024-25)
4 Commission Action Estimated
Transaction Size
($ Million)
Commission
Action
Closing
1. Water, Wastewater and Power -
Authorize expansion of interim funding
program and approve bank credit
facilities agreements
$250 - Water Q1 FY24-25 Q2 FY24-25
$500 – Wastewater Q1 FY24-25 Q2 FY24-25
$200 - Power Q1 FY24-25 Q2 FY24-25
2. Water - Authorize Revenue Bonds to
refinance outstanding commercial paper,
deposit funds into project fund accounts
and allow new project encumbrance.
Up to $762 Q2 FY24-25 Q3 FY24-25
3. Wastewater – Approve second loan
under the WIFIA Programmatic Master
Agreement
$145 Q2 FY24-25 Q3 FY24-25
4. Water - Approve renewal or replacement
of bank credit facilities for interim funding
programs
Up to $100 Q4 FY24-25 Q4 FY24-25
5. Water – Authorize Clean Water State
Revolving Fund (SRF) execution of Loan
Agreement
TBD TBD TBD
5. Debt Policy Update - Adopt an update
to the Debt Management Policy and
Procedures -- Q4 FY24-25 --
5 Interim Funding Program
• The Commission and BOS authorized a two-year Fiscal Year 2024-25 and Fiscal Year 2025-26 budget with total of $3 billion placed on Controller’s Appropriation Reserve.
• No construction contracts can be let until budget authority is released by the Controller and the Controller will not authorize such releases unless the source of full funding of the project is demonstrated. • The interim funding program provides a low-cost tool for doing that without issuing bonds prematurely.
• The interim funding program allows the SFPUC to pay capital costs ahead of issuing bonds, reducing interest costs and comply with tax exempt bond rules efficiently.
6 Interim Funding Programs
• Increase flexibility by allowing the ability to release appropriation from the Controller against the interim funding programs to incur actual expenditures
• Increase flexibility to the timing of future bond issuances and reduce interest costs by providing additional credit facilities to interim fund capital projects as needed
Meet Interim Appropriation Release Needs
• Approximately 4% all-in Commercial Paper borrowing rate in today's market (interest rate (coupon), credit facility fees, dealer fees) • As the Federal Reserve begins to lower rates, the rates on commercial paper should decline
• Credit agreements such as revolvers provide direct bank loans at a predetermined spread to a benchmark index (ex. SOFR or SIFMA) Provides low-cost interim funding of Capital Programs
7 Wastewater
Interim Funding Program
$750 million authorized
• Five series ($675 million) for Commercial Paper (CP); one series ($75 million) for Revolving Credit Line:
Series
Amount
($millions) Credit Facility Bank Facility Type
Exp. Date
A-1 150 Sumitomo Mitsui Bank Letter of Credit 3/2/29
A-2 150 Bank of America Letter of Credit 4/24/26
A-4 150 TD Bank, N.A. Liquidity Facility 7/3/28
A-6 125 Bank of America Liquidity Facility 8/2/27
A-7 100 Sumitomo Mitsui Bank Letter of Credit 5/31/27
R-1 75 US Bank Revolving Credit
Agreement
7/16/27
8 Water
Interim Funding Program
$500 million authorized
• Three series ($400 million) for Commercial Paper (CP); one series ($100 million) for Revolving Credit Line:
Series
Amount
($millions) Credit Facility Bank Facility Type
Exp. Date
A-1 100 Sumitomo Mitsui Bank Letter of Credit 5/16/25
A-2 200 Sumitomo Mitsui Bank Letter of Credit 6/14/27
A-3 100 Barclay’s Bank Letter of Credit 7/15/27
R-1 100 US Bank Revolving Credit
Agreement
7/16/27
9 Power
Interim Funding Program
$250 million authorized
• Two series ($250 million) for Commercial Paper (CP):
Series
Amount
($millions) Credit Facility Bank Facility Type
Exp. Date
A-1 125 Bank of America Letter of Credit 3/6/26
A-2 125 Bank of America Letter of Credit 3/6/26
Interim Financing Program
Expansion
10 $0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$-
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Commercial Paper Program Expansion History and 10-Year Financial Plan Bond Issuance (in Millions)
Water Water Expansion (2009) Wastewater
Wastewater Expansion 1 (2012) Wastewater Expansion 2 (2014) Wastewater Expansion 3 (2017) Power Power Expansion (2019) 10-Yr Financial Plan Bond Issuance 10-Year CIP
Wastewater
Power
Water
Annual Bond Issuance
(Calendar Year)
11 *This chart represents only bonds issued. In addition, there are various other financing tools the SFPUC utilizes including loans and credit facilities that we obtain and maintain. $0
$500
$1,000
$1,500
$2,000
$2,500
2001 2002 2003 2006 2009 2010 2011 2012 2013 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 $ millions
SFPUC Annual Issuance
Water (Green) Water (Non-Green) Wastewater (Green) Wastewater (Non-Green) Power (Green) Power (Non-Green) • The $1.142 billion of 2024 ABCD Wastewater Bonds represent the SFPUC’s largest bond issuance to date.
• Aggregate bond issuances in 2023 were the largest year of bond issuances.
Analysis of Interim Financing
12 Enterprise CIP 2-Year
Average
(2024-2029)
CIP 2-Year Max
(2024-2029)
Current Program Proposed Interim
Funding Program
Proposed
Amendment
Water $776.3 million $907.6 million $500 million $750 million $250 million Wastewater 1,313.6 million 1,665.0 million 750 million 1,250 million 500 million Power 426.1 million 512.2 million 250 million 450 million 200 million 500
776.3 750
1313.6
250
426.1
250
500
200
$-
$200
$400
$600
$800
$1,000
$1,200
$1,400
Water Water CIP 2-Year
Average
Wastewater Wastewater CIP 2-
Year Average
Power Power CIP 2-Year
Average
Current Program Size vs CIP 2-Year Average (2024-2029)
(In millions)
Proposed Amendment
Recommended
Commission Action
13 Request to adopt resolution authorizing an
increase/expansion of the Commission’s current short-
term interim funding programs and authorizes the
General Manager or designee to prepare and introduce an ordinance with the terms described here for adoption by the Board of Supervisors and approval by the Mayor:
• $1.250 billion for the Wastewater Enterprise Interim
Funding Program (increase of $500 million)
• $750 million for the Water Enterprise Interim Funding Program (increase of $250 million)
• $450 million for the Power Enterprise Interim Funding Program (increase of $200 million)
Interim Funding Program
Expansion Process
14 Commission
approves
resolution to
prepare
Ordinance
Board of
Supervisors
approves
Ordinance
and Mayor
Signs
Ordinance
SFPUC
conducts
competitive
solicitation(s)
for additional
credit
facilities
Commission
approves
each new
credit facility
per BOS
Authorization
15 Questions
AGENDA ITEM
Public Utilities Commission
City and County of San Francisco
DEPARTMENT Financial Services AGENDA NO. 8
MEETING DATE September 10, 2024
Calendar: Regular Calendar
Project Manager: Nikolai J. Sklaroff
Approve Expansion of the Wastewater, Water, and Power Enterprise Interim Funding and Commercial Paper Programs and Advancement to the Board of Supervisors Summary of
Proposed
Commission Action
Approve the expansion of the Wastewater, Water, and Power Enterprise Interim Funding Programs from $750 million, $500 million, and $250 million, to not-to-exceed aggregate pr incipal amounts of $1.25 billion, $750 million, and $450 million, respectively; and authorize the General Manager, or the General Manager’s designee, to prepare and introduce an ordinance with the terms described here for adop tion by the Board of Supervisors and approval by the Mayor.
Background The purpose of this action is to increase the authority of the San Francisco Public Utilities Commission (SFPUC) to provide cost-effective interim funding for the Wastewater, Water, and P ower Enterprises’ capital projects pursuant to each enterprise’s respective 10-year capital improvement plans.
Expansion of the Programs requires a pproval from the Board. San Francisco Administrative Code Section 43.5, Ar ticle V (Ordinance No. 203-98 and adopted by the Board on June 8, 1998, as amended by Ordinance No. 270- 06, adopted by the Board on October 24, 2006), established a procedure for the Commission to issue short-term i ndebtedness, including the issuance of commercial paper in anticipation of the issuance of revenue bonds. The total authorized principal that may be outstanding at any one time has changed as follows:
Agenda Title: Authorize the Expansion of the Wastewater, Water, and Power Enterprise Interim Funding Programs Commission Meeting Date: September 10, 2024
Fiscal Year 2007 2012 2015 2017
2025
(Proposed)
Wastewater $150m $300m $500m $750m $1.25b
Ordinance/Resolution 266-06 91-12 378-14 193-17 Proposed BOS Approval Oct-06 May-12 Sep-14 May-17 Nov-24
Fiscal Year 2003 2009
2025
(Proposed)
Water $250m $500m $750m
Ordinance/Resolution 300-03 311-08 Proposed
BOS Approval May-03 Dec-08 Nov-24
Fiscal Year 2016 2019
2025
(Proposed)
Power* $90m $250m $450m
Ordinance 427-15 2-19 Proposed
BOS Approval Nov-15 Jan-19 Nov-24
x The Power Enterprise commercial paper Program is authorized under Sections 9.107(6) and 9.107(8) in addition to Chapter 43, Article V of the Charter as of November 2018.
Reason for Expansion of the Programs: In February 2024, the Commission adopted the 10-Year Capital Plans for each of the Wastewater Enterprise, Water Enterprise, and Hetch Hetchy Water and Power Enterprise, for FY 2024-25 through 2033-34. These 10- Year Capital Plans reflect an overall 34.4% increase in size from the previously approved plans, growing from $8.8 billion to $11.8 billion in aggregate. The projected revenue bond issuance needed to fund the plans has also grown commensurately.
The proposed expanded Programs for each enterprise are intended to meet the interim expenditures and appropriation releases needed over the future two-year budget periods of the capital plans. Issued commercial paper or other interim funding sour ces will be retired by l ong-term revenue bonds or future state and/or federal loans, if available. When long-term financing is secured, interim funding program capacity is released to be used again to provide funding for project appropriati ons in subsequent two-year budget periods.
Increases to the Programs will provide additional flexibility and allow the SFPUC to release approximately two years of appropriations against the Programs, such that the SFPUC could incur actual expenditures before issuing revenue bonds or borrowing additi onal state or federal loans. Simply securing the letters of credit or other facilities authorized under the expansions will provide the basis for the Controller’s release of project funds. This process is much more expe dient and cost-effective than issuing bonds in anticipation of future spending.
As contract payments are due, the SFPUC has and will issue commercial Agenda Title: Authorize the Expansion of the Wastewater, Water, and Power Enterprise Interim Funding Programs Commission Meeting Date: September 10, 2024
paper or make draws under a borrowi ng vehicle under the applicable short- term interim funding Progr am to pay those contr act payment costs on a programmatic basis. In today’s market, the SFPUC’s commercial paper borrowing results in (in aggregate, across all enterprises) an approximately 4% all-in borrowing rate. This provides low-cost, interim short-term funding for capital project expenditures, in all cases in advance of the issuance of long-term revenue bonds. As the Federa l Reserve begins to lower rates, potentially as soon as September 2024, the rates on commercial paper should also decline. The credit markets provide lower interest rates for a commercial paper program that has credit or liquidity support through one or more letters of credit or liquidity facilities, and that also has qualified dealers to issue and remarket the commercial paper to investors. Other short-term funding products, such as revolving lines of credit, can also provide low-cost interim funding for projects.
The new proposed Programs sizes align to the average projected, consecutive two-year budget periods in the resp ective five-year capital plans. These amounts are used as proxies for antic ipated appropriation releases and encumbrances. These years encompass the largest anticipated expenditures of each of the capital plans.
Debt Funded Capital Improvement Plan Appropriation (in $ 000s):
FY
Water CIP Water 2-
yr CIP
WW CIP WW 2-yr
CIP
Power
CIP
Power 2-
yr CIP
2024 305,138 890,195 100,398
2025 435,622 740,759 774,782 1,664,978 182,773 283,171
2026 444,134 879,756 683,538 1,458,320 227,010 409,784
2027 463,465 907,599 806,528 1,490,066 243,820 470,831
2028 338,515 801,980 447,426 1,253,954 268,348 512,168
2029 213,137 551,652 253,145 700,571 186,106 454,454
2-yr Avg: 776,349 1,313,578 426,081
Current Program 500,000 750,000 250,000
Proposed
Amendment 250,000 500,000 200,000
Proposed Interim
Funding Program 750,000 1,250,000 450,000
The Programs will complement future revenue bond issuances in the 10-year financial plans, and will provide flexibility with respect to the timing of those issuances. With the expansi ons, the SFPUC may obtain additional credit facilities to support capital project s on an interim basis. After capital spending tapers in the later years of the capital plans, excess credit facilities may be allowed to expire or terminate.
Expanded facilities are not expected to be used entirely or immediately upon the Board’s adoption of an ordinance with the terms described here. Credit facility procurement and entry into project contracts will both be strategically timed. This work will be coordinated with the renewal of existing facilities and structured to achieve optimal pricing of SFPUC credit Agenda Title: Authorize the Expansion of the Wastewater, Water, and Power Enterprise Interim Funding Programs Commission Meeting Date: September 10, 2024
facilities. As is standard practice for the SFPUC, the SFPUC plans to seek proposals for credit facilities through a competitive solicitation process from a pre-qualified pool of bank credit f acility providers. The Commission will be asked to approve any new credit facility agreements to be created under this expansion.
The increase in the size of interim fi nancing does not change the amount of debt authorized to be undertaken by the SFPUC, but merely expands the interim financing tool.
Environmental
Review:
This action does not constitute a “project” under the California Environmental Quality Act Guidelines section 15378(b)(4) because approval of the expansion of the Programs and authorization of an ordinance for advancement to the Board would cons titute the creation of a government funding mechanism, which does not i nvolve any commitment to a specific project that may result in a potentially significant physical change in the environment.
PUBLIC UTILITIES COMMISSION
City and County of San Francisco
RESOLUTION NO.:
WHEREAS, On November 5, 2002, the voters of the City and County of San Francisco (the “City”) approved Proposition E (“Proposition E”), which among other things, authorized the San Francisco Public Utilities Commission (the “Commission”) to issue indebtedness, including revenue bonds, notes, commercial pa per or other forms of indebtedness, when authorized by ordinance approved by a two-thirds vote of the Boar d of Supervisors of the City (the “Board”), for the purpose of (i) reconstructing, replaci ng, expanding, repairing or improving wastewater facilities under the jurisdiction of the Commission (the “Wastewater Enterprise”), and (ii) reconstructing, replacing, expa nding, repairing or improving wa ter facilities or clean water facilities or combinations of water and clean wate r facilities under the jurisdiction of the Commission (the “Water Enterprise”); and
WHEREAS, On June 5, 2018, the voters of the City approved Proposition A (“Proposition A”), which among other things, amended Section 8B.124 of the Charter of the City and County of San Francisco (the “Charter”) to authorize the Commission to issue indebtedness, including revenue bonds, notes, commercial paper or other fo rms of indebtedness, when authorized by ordinance approved by a two-th irds vote of the Board, for the purpose of reconstructing, replacing, e xpanding, repairing or improvi ng power facilities under the jurisdiction of the Commission (the “Power Enterpri se”), or for any other lawful purpose of the power facilities of the City in furtherance of the purposes specified in Charter Section 8B.124, provided that the Commission is prohibited from fina ncing the construction of power plants that generate electricity using fossil fuels or nuclear energy under Proposition A; and
WHEREAS, Pursuant to Section 43.5 of the San Francisco Administrative Code (“Article V”), enacted by Ordinance No. 203-98 adopted by the Board on June 8, 1998, and signed by the Mayor of the City on June 19, 1998, as amende d by Ordinance No. 270-06, adopted on October 24, 2006 by the Board and signed by the Mayor on October 31, 2006 (the “Procedural Ordinance”), the Board established a procedure pursuant to which the Commission may issue short-term indebtedness (including the issuance of commercial paper and other forms of short- term indebtedness) in anticipation of the issuance of its revenue bonds; and
WHEREAS, Under Section 8B.124 of the Charter, the Board’s authority to authorize an issuance of debt under Proposition A or Proposition E, as applicable, is subject to the provision of certain certifications of an independent engineer retained by the Commission and certain certifications by the San Francisco Planning Depa rtment, which certifications shall make the findings and determinations set forth in Charter Section 8B.124 (the “Proposition A Certificates” or “Proposition E Certificates” (as applicable)); and
WHEREAS, As it relates to the Wastewater Enterprise: (i) the Commission has previously authorized pursuant to Reso lution No. 06-0164, approved by the Commission on September 26, 2006, and the Board has previously approved pursuant to Ordinance No. 266-06, adopted by the Board on October 24, 2006, and signed by the Mayor on October 31, 2006, the establishment of a commercial paper program/interim funding program (the “Wastewater Interim Funding Program”) for the Wastewater Enterprise and the issuance of up to $150 million, at that time, in aggregate principal amount of Wastewate r Enterprise commercial paper notes and/or bank notes outstanding at any one time; (ii) the Commission has previously authorized pursuant
to Resolution No. 11-0197, approved by the Commission on December 13, 2011, and the Board has approved pursuant to Ordinance No. 91- 12, adopted by the Board on May 8, 2012, and signed by the Mayor on May 14, 2012, an ordinance to authorize, an increase in the Wastewater Interim Funding Program to an aggregate principal amount not to exceed $300 million, at that time, of commercial paper notes and/or bank notes outstanding at any one time from an aggregate principal amount of not to exceed $150 million of commercial paper notes and/or bank notes outstanding at any one time; (iii) the Commission has previously authorized pursuant to Resolution No. 14-0139, approved by the Co mmission on August 26, 2014, and the Board has approved pursuant to Resolution No. 378-14, ad opted by the Board on September 30, 2014, and signed by the Mayor on October 9, 2014, a resolution to authorize, an increase in the Wastewater Interim Funding Program to an aggregate principal amount not to exceed $500 million, at that time, of commercial paper notes and/or bank notes outstanding at any one time from an aggregate principal amount of not to exceed $300 million of commercial paper notes and/or bank notes outstanding at any one time; and (iv) the Commission has previously authorized pursuant to Resolution No. 17-0086, approved by the Co mmission on April 25, 2017, and the Board has approved pursuant to Resolution No. 193-17, adopted by the Board on May 23, 2017, and signed by the Mayor on May 26, 2017, an increase in the Wastewater Interim Funding Program to an aggregate principal amount not to exceed $750 million from $500 million aggregate principal amount of short-term indebtedness (including, but not limited to, co mmercial paper notes and/or bank notes), outstanding at any one time; and
WHEREAS, Pursuant to (i) Ordinance No. 128-21, adopted by the Board on July 27, 2021 and signed by the Mayor on August 4, 20 21, (ii) Ordinance No. 110-22, adopted by the Board on June 14, 2022 and signed by the Mayor on June 24, 2022, (iii) Or dinance No. 181-23, adopted by the Board on July 25, 2023 and signed by the Mayor on July 28, 2023, and (iv) Ordinance No. 125-24, adopted by the Board on June 11, 2024 and signed by the Mayor on June 21, 2024, the Board has authorized the issuance from time to time of up to $4,030,588,703 of Wastewater Enterprise revenue bonds and other forms of indebtedness of the Commission under Proposition E, and in the anticipation of the issu ance of such indebtedness, has authorized the issuance of short-term indebtedness of the Commission; and
WHEREAS, The Commission has determined that it is necessary and desirable to make certain additional improvements to the facilities of the Wastewater Enterprise and has further determined to finance such additional impro vements through the issuance of Wastewater Enterprise revenue bonds and other forms of inde btedness, and in anticipation of issuance of such Wastewater Enterprise revenue bonds an d other forms of indebtedness, through the expansion of the Wastewater Interim Funding Program, the Commis sion now desires to increase the aggregate principal amount of short-term in debtedness authorized to be outstanding at any one time under the Wastewater Interim Funding Program by $500 million, increasing authorization to $1.250 billion from $750 million of ag gregate principal amount of short-term indebtedness outstanding at any one-time (including, but not limite d to, commercial paper notes, revolving notes, bank notes, revolving lines of credit, any fixed and/or vari able rate short-term borrowing facility/program and/or any other short-term borrowing vehicle which furthers the purpose and intent of the Wastewater Interim Funding Program), contingent upon the preparation and introduction of an ordinanc e for approval by the Board and acceptance by the Mayor (referred to herein, and describing all Enterprises, as the “Proposed Ordinance”); and
WHEREAS, As it relates to the Water Enterprise: (i) the Commission has previously authorized pursuant to Resolution No. 03-0048, approved by the Commission on Mach 25, 2003, and the Board has previously approved pursuant to Ordinance No. 300-03, adopted by the Board on May 6, 2003, and signed by the Mayor on Ma y 16, 2003, the establishment of a commercial paper program/interim funding pr ogram (the “Water Interim Funding Program”) for the Water
Enterprise and the issuance of up to $250 million, at that time, in aggregate principal amount of Water Enterprise commercial paper notes and/or bank notes outstanding at any one time; and (ii) the Commission has previously authorized pursu ant to Resolution No. 08-0202, approved by the Commission on October 30, 2008, and the Board has previously approved pursuant to Ordinance No. 311-08, adopted by the Board on December 16, 2008 and signed by the Mayor on December 19, 2008, an increase in the Water Interim Funding Program from an aggregate principal amount of $250 million to an aggregate principal amount of $500 million outstanding at any one time; and
WHEREAS, Pursuant to (i) Ordinance No. 174-20 adopted by the Board on September 29, 2020 and signed by the Mayor on October 1, 2020, (ii) Ordinance No. 112-22, adopted by the Board on June 14, 2022 and signed by the Mayor on June 24, 2022, (iii) Or dinance No. 180-23, adopted by the Board on July 25, 2023 and signed by the Mayor on July 28, 2023, and (iv) Ordinance No. 131-24 adopted by the Board on J une 18, 2024 and signed by the Mayor on June 27, 2024, the Board has authorized the issuance from time to time of up to $1,887,552,493 of water revenue bonds and other forms of indebt edness of the Commission under Proposition E, and in the anticipation of the issuance of such indebtedness, has authorized the issuance of short- term indebtedness of the Commission; and
WHEREAS, The Commission has determined that it is necessary and desirable to make certain additional improvement to the facilities of the Water Enterprise and has further determined to finance such a dditional improvements through the issuance of Water Enterprise revenue bonds and other forms of indebtedness, a nd in anticipation of issuance of such Water Enterprise revenue bonds and othe r forms of indebtedness, through the expansion of the Water Interim Funding Program, the Commission now de sires to increase the aggregate principal amount of short-term indebtedness authorized to be outstanding at any one time under the Water Interim Funding Program by $250 million, increasing authorization to $750 million from $500 million of aggregate principal amount of short- term indebtedness outst anding at any one-time (including, but not limited to, commercial pape r notes, revolving notes, bank notes, revolving lines of credit, any fixed and/or variable rate short-term borrowing facility/program and/or any other short-term borrowing vehicl e which furthers the purpose and intent of the Water Interim Funding Program), contingent upon approval of the Proposed Ordinance; and
WHEREAS, As it relates to the Power Enterprise: (i) the Commission has previously authorized pursuant to Resolution No. 15- 0183, approved by the Commission on September 8, 2015, and the Board has previously approved pursuant to Resolution No. 427-15, adopted by the Board on November 17, 2015, and signed by the Mayor on November 25, 2015, the establishment of a commercial paper progra m/interim funding program (the “Power Interim Funding Program”) for the Power Enterprise and th e issuance of up to $90 million, at that time, in aggregate principal amount of Power Enterp rise commercial paper not es outstanding at any one time; and (ii) the Commission has previously authorized pursuant to Resolution No. 18- 0188, approved by the Commission on November 13, 2018, and the Board has previously approved pursuant to Ordinance No. 2-19, adopted by the Board on January 15, 2019, and signed by the Mayor on January 18, 2019, an increase in the Power Interim Funding Program from an aggregate principal amount of $90 million to an aggregate principal amount of $250 million of commercial paper notes outstanding at any one time; and
WHEREAS, Pursuant to (i) Ordinance N o. 142-18 adopted by the Board on June 12, 2018 and signed by the Mayor on June 20, 2018, (ii) Ordinance No. 152-19 adopted by the Board on June 25, 2019 and signed by the Mayor on June 28, 2019, (iii) Ordinance No. 127-21 adopted by the Board on July 27, 2021 and signed by the Mayor on August 4, 2021, (iv) Ordinance No. 109-22 adopted by the Board on J une 14, 2022 and signed by the Mayor on June
24, 2022, (v) Ordinance No. 182-23 adopted by th e Board on July 25, 2023 and signed by the Mayor on July 28, 2023, and (vi) Ordinance N o. 126-24 adopted by the Board on June 11, 2024 and signed by the Mayor on June 21, 2024, the Boar d has authorized the issuance from time to time of up to $836,960,525 of Power Enterprise re venue bonds and other forms of indebtedness of the Commission under Proposition A and Sections 9.107(6) and 9.107(8) of the Charter, and in the anticipation of the issuance of such indebtedness, has authorized the issuance of short-term indebtedness of the Commission; and
WHEREAS, The Commission has determined that it is necessary and desirable to make certain additional improvement to the facilities of the Power Enterprise and has further determined to finance such a dditional improvements through the issuance of Power Enterprise revenue bonds and other forms of indebtedness, and in anticipation of issuance of such Power Enterprise revenue bonds and othe r forms of indebtedness, thr ough the expansion of the Power Interim Funding Program, the Commission now de sires to increase the aggregate principal amount of short-term indebtedness authorized to be outstanding at any one time under the Power Interim Funding Program by $200 million, increasing authorization to $450 million from $250 million of aggregate principal amount of short- term indebtedness outst anding at any one-time (including, but not limited to, commercial pape r notes, revolving notes, bank notes, revolving lines of credit, any fixed and/or variable rate short-term borrowing facility/program and/or any other short-term borrowing vehicle which accomplishes the purpose and intent of the Water Interim Funding Program), contingent upon approval of the Proposed Ordinance; and
WHEREAS, The Proposition A Certificates and the Proposition E Certificates (as applicable), meeting the Proposition A require ments and the Propositi on E requirements (as applicable) are, or will be, on f ile with the Clerk of the Board in accordance with Proposition A and Proposition E, in accordance with Section 8B.124 of the Charter; and
WHEREAS, This action does not constitute a “project” under the California Environmental Quality Act Guidelines section 15378(b)(4) because approval of the expansion of the Wastewater, Water, and Power Enterprise Interim Funding Programs and authorization of the Proposed Ordinance would constitute the creati on of a government funding mechanism, which does not involve any commitment to a specific project that may result in a potentially significant physical change in the environment; now, therefore, be it
RESOLVED by the Public Utilities Commission of the City and County of San Francisco, as follows:
Section 1. Proposed Ordinance. The SFPUC Ge neral Manager or the General Manager’s designee, is instructed to prepare and introduce an ordinance consistent with the terms stated in this Resolution and describing the expansions of the Wastewater Interim Funding Program, Water Interim Funding Program and Power Interim Funding Program, for adoption by the Board and approval by the Mayor, subject to filing with the Clerk of the Board the necessary Proposition E Certificates and Proposition A Certificates (as applicable).
Section 2. Expansion of Wastewater Inte rim Funding Program. The Commission hereby approves the expansion of the Wastewater In terim Funding Program and a $500 million increase in the aggregate principal amount of short-term indebtedness authorized to be outstanding at any one time under the Wastewater In terim Funding Program, increasing authorization to $1.250 billion from $750 million of aggregate principal amount of short-term indebtedness outstanding at any one-time. The General Ma nager or their designee is authorized to issue up to $1.250 billion in aggregate principal amount of short- term indebtedness (inc luding, but not limited to, commercial paper notes, revolving not es, bank notes, revolving lines of credit, any fixed and/or
variable rate short-term borrowing facility/program and/or any other short-term borrowing vehicle which accomplishes the purpose and intent of the Wastewater Interim Funding Program) outstanding at any one-time in accordance with the terms hereof.
Section 3. Expansion of Water Inter im Funding Program. The Commission hereby approves the expansion of the Water Interim Funding Program and a $250 million increase in the aggregate principal amount of s hort-term indebtedness authorized to be outstanding at any one time under the Water Interim Funding Program, increasing authorization to $750 million from $500 million of aggregate principal amount of shor t-term indebtedness ou tstanding at any one- time. The General Manager or th eir designee is authorized to issue up to $750 million in aggregate principal amount of short-term indebtedness (including, but not limited to, commercial paper notes, revolving notes, bank not es, revolving lines of credit, an y fixed and/or variable rate short-term borrowing facility/program and/or any other short-term borrowing vehicle which accomplishes the purpose and intent of the Water Interim Funding Program) outstanding at any one-time in accordance with the terms hereof.
Section 4. Expansion of Power Interim Funding Program. The Commission hereby approves the expansion of the Power Interim Funding Program and a $200 million increase in the aggregate principal amount of short-term in debtedness authorized to be outstanding at any one time under the Power Interim Funding Prog ram, increasing authorization to $450 million from $250 million of aggregate principal amount of short-term indebtedness outstanding at any one-time. The General Manager or their designee is authorized to issue up to $450 million aggregate principal amount of short-term indebtedness (including, but not limited to, commercial paper notes, revolving notes, bank not es, revolving lines of credit, an y fixed and/or variable rate short-term borrowing facility/program and/or any other short-term borrowing vehicle which accomplishes the purpose and intent of the Powe r Interim Funding Program) outstanding at any one-time in accordance with the terms hereof.
Section 5. Limitations. This Resolution shall be ineffective unless and until a Proposed Ordinance is adopted by the Board and approved by the Mayor.
Section 6. Ratification. All ac tions heretofore taken by th e officials, employees and agents of the Commission with respect to the expansions of the Wastewater Interim Funding Program, Water Interim Funding Program and Power Interim Funding Program are hereby approved, confirmed and ratified.
Section 7. Effective Date. This resolution shall take effect from and after its adoption.
I hereby certify that the fore going resolution was adopted by th e Public Utilities Commission at its meeting on September 10, 2024.
Director of Commission Affairs
San Francisco Public Utilities Commission