SFPUC authorizes renewals and new short‑term bank facilities to support capital program

The San Francisco Public Utilities Commission voted unanimously to approve a package of interim funding facilities intended to reduce borrowing costs for capital projects across the PUC’s water, wastewater and power enterprises.

Capital Finance Director Nikolai Sklaroff told the commission the program consists of five facilities: two power facilities (renewals with Bank of America) and three wastewater/water facilities (a mix of renewals and new facilities, including one with Truist Bank). Sklaroff said the facilities support the PUC’s interim funding and commercial paper strategy—allowing the agency to demonstrate funding availability to the city controller and to borrow in smaller increments—reducing short‑term funding costs compared with issuing long‑term bonds.

Sklaroff said facility fees and short‑term interest costs in the current market range roughly from 0.21% (21 basis points) to 0.42%, and he gave an example six‑month commercial paper rate of about 2.72%. He said issuing 30‑year bonds in the present market context could cost roughly 4.25% and that the interim approach can yield substantial savings for ratepayers over time. Commissioners asked about renewals versus new facilities, the program’s total capacity, and bond‑rating effects; Sklaroff said the total program across enterprises is $2,450,000,000 and that $950,000,000 expansion authorized by the Board of Supervisors has been deployed into the facilities portfolio.

The commission approved item 9 (power facilities under the power interim program) and item 10 (three wastewater/water facilities) in separate votes; both passed by unanimous roll call.