S.F. to Fight Reservoir Rent Hike

Buried deep in President Bush’s 2005 budget is a line item that has thrown this city into a panic. It proposes an increase in the rent San Francisco pays for its Hetch Hetchy reservoir in Yosemite National Park -- from $30,000 a year to $8 million.

The increase would require amendment of the Raker Act of 1913, which allowed the city to build the dam and reservoir. It would mark the first rent hike since the late 1920s and has stirred reactions as fierce as did the flooding of the scenic valley so many decades ago.

Public officials representing this city have vowed to fight the proposal, which comes as San Francisco battles a record deficit likely to exceed $300 million, while those representing Yosemite expressed glee at their prospective good fortune.

Meanwhile, environmentalists battling to restore the Hetch Hetchy Valley to its original splendor by eliminating the O’Shaughnessy Dam applauded the proposed increase as a way to draw attention to their cause.

The proposal, on Page 620 of the budget appendix, surprised even Yosemite National Park Supt. Michael J. Tollefson, who notified the even more startled head of the San Francisco Public Utilities Commission -- which owns and operates the reservoir -- late Monday.

“It really came out of left field,” said the commission’s general manager, Pat Martell, who met recently with park officials to discuss increasing by “a few hundred thousand dollars” the roughly $1.7 million the city pays annually to the park -- in addition to its rent -- for ranger patrols and watershed restoration. “We have not been provided any rationale on an increase of that magnitude.”

It was unclear Wednesday how the Interior Department had arrived at the $8-million figure, but spokesman John Wright said the proposal was one “worthy” way to deal with what would be a particularly tight budget year.

“We’re reallocating funds where we can reallocate,” he said. “We are looking at all options and ways to tighten our budget belt, and the Hetch Hetchy proposal is one of those.”

But as Martell spread word of the proposal, the gloves came off.

Peter Ragone, spokesman for Mayor Gavin Newsom, said the city would do everything it could to make sure the rent increase did not come to pass.

“On top of a $100-million hit from the Schwarzenegger administration, now George Bush wants to drop another $8-million hit on the city. It’s just outrageous,” Ragone said.

Rep. Nancy Pelosi (D-San Francisco), the House Democratic leader, issued a statement Wednesday calling the proposal “totally unacceptable” and “just another example of the Bush administration putting a bigger burden on local governments that are already stretched thin to pay for tax cuts for the rich.”

“We will not allow San Francisco’s hard-working taxpayers to pay for the administration’s failed budget and skyrocketing deficit,” she said.

And U.S. Sen. Dianne Feinstein -- who successfully staved off a similar attempt in the mid-1990s -- said her office was investigating whether other cities or states with reservoirs on federal land were being asked to shoulder comparable burdens.

“My initial response is one of substantial objection,” she said.

But others were delighted at the prospect of the massive boost, which would be channeled directly into the park’s coffers.

“The nice thing about this proposal is that $8 million could be used in Yosemite,” said Rep. George P. Radanovich (R-Mariposa), who applauded the prospect of an end to what he said had been an overly advantageous deal for San Francisco. “We’re always looking for ways to improve the park and pay for those improvements.”

Martell of the San Francisco utilities commission argues that the 360,000 acre-foot reservoir is not fenced, so the public is free to hike and backpack in the area. The benefits of the reservoir extend far beyond San Francisco, she said, adding that more than 2.4 million people in the Bay Area benefit from the Hetch Hetchy system -- two-thirds of them outside the city.

Martell said the increase would hurt ratepayers, who already are expected to see significant increases over the next 13 years to help finance a $3.6-billion reconstruction of the Hetch Hetchy system approved in part by a 2002 bond measure.

But those who have carried on in the spirit of John Muir’s opposition to the dam -- completed in 1923 -- say the proposal will help get their message out.

“San Francisco gets $40 million to $50 million every year from the sale of water and power. It’s a pretty good deal for San Francisco at the expense of the nation,” said Ron Good, executive director of Restore Hetch Hetchy. He said he hoped some of the money from the rent increase would go to create a Hetch Hetchy Valley visitor center and interpretive programs.

Spreck Rosekrans, a policy analyst for the group Environmental Defense, said the organization was analyzing alternatives to the reservoir, including better management of Tuolumne River facilities, development of additional groundwater resources and more local Bay Area storage.

“We believe that other options exist, and it’s time to revisit whether it should be a reservoir or whether it should be a national park,” Rosekrans said. “We think that reminding everybody that they are using a spectacular area of a national park for a reservoir will help open up the debate on whether it’s the right place to store water or whether we should find a different place.”