§ 16.103.



Receipts from each utility operated by the Public Utilities Commission shall be paid into the City and County treasury and maintained in a separate fund for each such utility. Appropriations from such funds shall be made for the following purposes for each such utility in the order named:

1. For the payment of operating expenses, pension charges and proportionate payments to such compensation and other insurance and accident reserve funds as the Commission may establish or the Board of Supervisors may require;

2. For repairs and maintenance;

3. For reconstruction and replacements as hereinafter described;

4. For the payment of interest and sinking funds on the bonds issued by the Public Utilities Commission pursuant to this charter;

5. For extensions and improvements; and

6. For a surplus fund.

For any utility with outstanding bonds for which the indenture requires different payment priorities, the bond priorities will control over the priorities set forth in this section.


For the purpose of providing funds for reconstruction and replacements due to physical and functional depreciation of each of the utilities under the jurisdiction of the Commission, the Commission must create and maintain a reconstruction and replacement fund for each such utility, sufficient for the purposes mentioned in this section, and in accordance with an established practice for utilities of similar character, which shall be the basis for the amount necessary to be appropriated annually to provide for said reconstruction and replacements.


If, at the end of any fiscal year, the Controller certifies that excess surplus funds of a utility exist, from hydropower assets or water or clean water assets in excess of 25 percent of the total expenditures of such utility in the previous fiscal year for costs of operation, repair, maintenance and debt service coverage and required debt service reserves, the Public Utilities Commission may transfer that surplus revenue, in whole or in part, to any other utility system under the Commission’s jurisdiction on the operative date of this section.


Any surplus revenue which the Public Utilities Commission unanimously finds is not required for utility purposes pursuant to sections (a) and (b) of this section may be transferred to the General Fund by the Public Utilities Commission with the concurrence of three-fourths of the Board of Supervisors upon making all of the following findings of fact and judgment:


That a surplus exists or is projected to exist after meeting the requirements of this section;


That there is no unfunded operating or capital program or required reserve that by its lack of funding could jeopardize bond ratings, health, safety, water supply or power production;


That there is no reasonably foreseeable operating contingency that cannot be funded without General Fund subsidy; and


That such a transfer of funds in all other respects reflects prudent utility practice.

The Commission shall make such findings having received reports and an affirmative recommendation from the General Manager and a public hearing, which shall have received no less than 30 days of public notice.


The provisions of subsection (c) above shall not be applied in a manner that would be inconsistent with the provisions of any outstanding or future indentures, resolutions, contracts or other agreements of the City and County relating to bonded indebtedness issued in connection with the utility, or with any applicable state or federal laws.


(Amended November 2002)


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