As a long-time observer and participant in San Francisco’s civic and infrastructure matters, I write to address critical issues within the San Francisco Public Utilities Commission (SFPUC). Specifically, I urge your leadership in addressing governance concerns and restoring oversight mechanisms to protect ratepayers and ensure fiscal responsibility.

Immediate Leadership Action
The SFPUC operates under a flawed business model, worsened by the direct appointment of Dennis Herrera as General Manager without a comprehensive search process. This bypass undermines transparency and public trust. I strongly recommend initiating a proper and open search for this critical leadership role, with your active involvement to ensure the best-qualified candidate is selected.

Proposition P and the RBOC
In 2002, Proposition P created the Revenue Bond Oversight Committee (RBOC) to act as an independent watchdog, ensuring the SFPUC adhered to fiscal accountability and Proposition 218 mandates. Unfortunately, the RBOC was quickly co-opted and became dependent on the SFPUC, compromising its oversight role.

As a co-author of Proposition P and a former two-term member of the RBOC, I can attest to this troubling shift. The RBOC was designed to:

Ensure compliance with Proposition 218, which mandates reasonable and allowable utility rates.
Provide oversight of bond issuances after 2002’s Proposition E transferred debt approval from voters to the Board of Supervisors.
This failure of independence has left SFPUC unaccountable and vulnerable to potential legal challenges, particularly under Proposition 218.

Urgent Financial Oversight
Another pressing issue is the 2009 revision of the Master Water Sales Agreement with the Bay Area Water Supply and Conservation Agency (BAWSCA). The shift from the traditional Utility Method to the cash method for calculating debt service raises concerns about compliance with Proposition 218. This method, coupled with bond “churning” practices, creates financial fluctuations that make adherence to Proposition 218’s requirements nearly impossible. The RBOC should have addressed these concerns, but its compromised role has left these issues unexamined.

Call to Action
I urge you to:

Reactivate the search for a qualified SFPUC General Manager.
Restore the independence of the RBOC to its intended role as a watchdog for ratepayers and bondholders.
Address critical updates to the 2009 Master Water Sales Agreement to ensure compliance with Proposition 218.
I am available to discuss these matters further and provide additional insights.