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HomeMy WebLinkAbout2009-05-11 City Council Agenda Packet 1 05/11/09 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Agenda posted according to PAMC Section 2.04.070. A binder containing supporting materials is available in the Council Chambers on the Friday preceding the meeting. Special Meeting May 11, 2009 5:30 P.M. ROLL CALL COUNCIL CONFERENCE ROOM STUDY SESSION 1. Joint meeting with Congresswoman Anna Eshoo Concerning Federal and Local Issues ATTACHMENT 6:30 PM or as soon as possible thereafter 2. Joint Study Session with Utilities Advisory Commission Regarding Smart Grid ATTACHMENT 7:30 PM or as soon as possible thereafter COUNCIL CHAMBERS SPECIAL ORDERS OF THE DAY 3. Appointment of Candidates for the Public Art Commission for One Unexpired Term Ending April 30, 2011 and Three, Three-Year Terms Ending April 30, 2012 2 05/11/09 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. ATTACHMENT 4. Appointment of Candidates for the Library Advisory Commission for Two Unexpired Terms, One Ending January 31, 2010 and One Ending January 31, 2011 ATTCHMENT CITY MANAGER COMMENTS ORAL COMMUNICATIONS Members of the public may speak to any item not on the agenda; three minutes per speaker. Council reserves the right to limit the duration or Oral Communications period to 30 minutes. APPROVAL OF MINUTES April 13, 2009 CONSENT CALENDAR Items will be voted on in one motion unless removed from the calendar by two Council Members. 5. Approval of Amendment No. Two to Agreement With the Housing Trust of Santa Clara County to Provide a Contribution in the Amount of $100,000 from the Residential Housing Fund for Fiscal Year 2008-09 and to Allow for Expenditure of City Contributed Funds for Qualifying Loans and/or Grant for Housing in Palo Alto through FY 2013/14 CMR 216:09 and ATTACHMENTS 6. 2nd reading for Ordinance - Amending Section 18.18.070(e) (Floor Area Bonuses) of Title 18 (Zoning) of the Palo Alto Municipal Code Regarding Protective Covenant in Favor of City (1st reading April 6, 2009 - Passed 9-0) 7. 2nd reading for Ordinance Repealing Chapter 5.30 (“Chlorofluorocarbon – Processed Food Packaging”) and Adding a New Chapter 5.30 (“Expanded Polystyrene and Non- Recyclable Food Service Containers”) to Title 5 (“Health and Sanitation”) of the Palo Alto Municipal Code 3 05/11/09 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. (1st Reading April 27, 2009 – Passed 8-0 Yeh Absent) MEMO & ATTACHMENT 8. Approval of Amendment No. 2 to Contract C05110846 with Maze & Associates to Provide a Contingency of $42,605 for a Total Contract Amount Not to Exceed $866,142 ATTACHMENT AGENDA CHANGES, ADDITIONS, AND DELETIONS HEARINGS REQUIRED BY LAW: Applications and/or appellants may have up to ten minutes at the outset of the public discussion to make their remarks and put up to three minutes for concluding remarks after other members of the public have spoken. OTHER AGENDA ITEMS: Public comments or testimony on agenda items other than Oral Communications shall be limited to a maximum of three minutes per speaker. UNFINISHED BUSINESS 9. Public Hearing: Adoption of an Ordinance Amending Chapter 5.24 of the City of Palo Alto Municipal Code (Requirements to Divert Construction and Demolition Waste from Landfill) to Increase Diversion Rate and Expand Applicability to Projects in Excess of $25,000; Environmental Assessment: Categorically Exempt Pursuant to Section 15308 of the CEQA Guidelines (Item Continued from April 27, 2009) CMR 212:09 and ATTACHMENTS REPORTS OF COMMITTEES AND COMMISSIONS 10. Policy and Services Committee Recommendation to Approve Proposed Procedure for Appointment of Santa Clara Valley Transportation Authority (VTA) Board Members from the Six North County Cities CMR 238:09 and ATTACHMENTS 4 05/11/09 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. COUNCIL MATTERS 11. Adoption of a Resolution Opposing the State Department of Finance’s Proposal to “Borrow” Local Government Property Taxes to Reduce the State’s Budget Deficit for FY2010 CMR 243:09 and ATTACHMENTS COUNCIL COMMENTS, ANNOUNCEMENTS, AND REPORTS FROM CONFERENCES Members of the public may not speak to the item(s). ADJOURNMENT Persons with disabilities who require auxiliary aids or services in using City facilities, services, or programs or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact 650-329-2550 (Voice) 24 hours in advance. City of Palo Alto Memorandum TO: HONORABLE CITY COUNCIL DATE: MAY 11,2009 SUBJECT: Potential Topics of Discussion For Joint Counell Meeting With Anna Eshoo Below are the potential topics of discussion generated for a joint study session with Congresswomen Anna Eshoo and the City Council at 5:30 p.m. on May 11,2009. The Council can raise other topics for Congresswomen Anna Eshoo at the meeting. Environmental and Transportation • Recognition of Congresswoman Eshoo's: o Green Office in Palo Alto o Support for Alternative Transportation Measures •. Safe, Accountable, Flexible, Efficient Transportation Equity Act o Charleston Corridor Safety Improvement Project o Highway 101 Pedestrian and Bicycle Overcrossingl Undercrossing Project • Status of Cap and Trade Legislation Federal Appropriation Projects • Palo Alto Art Center • Clara Drive Storm Drain • San Francisquito Creek • Palo Alto Recycled Water Distribution Project American Recovery and Reinvestment Act • Update on U.S. Department of Commerce's Broadband Technology Opportunities Program • Review of City projects High Speed Rail • Status of Federal funding • Discussion of community outreach Other Topics of Interest to City Council Recreation upervisor on Assignment in City Manager's Office City of Palo Alto Memorandum TO: HONORABLE CITY COUNCIL 2 FROM: CITY MANAGER DEPARTMENT: UTILITIES DATE: MAY 11,2009 SUBJECT: Potential Topics of Discussion for the Joint Study Session with Utilities Advisory Commission Regarding Smart Grid Below are the potential topics of discussion for the joint study session with the Utilities Advisory Commission at 6:30 P.M. on May 11,2009: 1) Elements of Smart Grid presented by Electric Power Research Institute 2) Palo Alto's Approach to Smart Grid . ONG HONORABLE CITY COUNCIL City of Pa 10 Alto C!ty_QfPmQi~JJQ Office of the City Clerk May 11, 2009 SUBJECT: Appointments for the Public Art Commission for one unexpired term ending April 30, 2011 and three, three-year Terms Ending April 30, 2012 Dear Council Members: On Monday, May 11, 2009 the City Council should vote to appoint one unexpired term ending April 30, 2011 and three, three-year terms ending April 30, 2012 for the Public Art Commission. The Candidates are as follows: Terry Acebo-Davis Dean BUl1derson Nancy Coleman Kenneth Huo Christina Pahl Einar Sunde Voting will be by paper ballot. Five votes are required to be appointed. The top three candidates that receive at least five votes will be appointed to the full 3 year terms. The fourth candidate with at least five votes will be appointed to the unexpired term. cc: Linda Craighead, Staff Liaison Respectfully submitted, ~=~~ Deputy City Clerk p.o. Box 10250 Palo Alto, CA 94303 650.329.2571 650.328.3631 fax HONORABLE CITY COUNCIL City of Palo Alto CjtyQfJ~ill:Q .. t\ltQ Office of the City Clerk May 11, 2009 SUBJECT: Appointments for the Library Advisory Commission· for Two Unexpired Terms, One Ending January 31, 2010 and One Ending January 31, 2011 Dear Council Members: On Monday, May 11, 2009 the City Council should vote to appoint two unexpired terms, one ending January 31, 2010 and one ending January 31, 2011 to the Library Advisory Commission. The Candidates are as follows: Marc Marchiel Sara Hart Kristine Mietzner Voting will be by paper ballot. Five votes are required to be appointed. The first candidate to receive at least five votes will be appointed to the term ending on January 31, 2011. The second candidate to receive at least five votes will be appointed to the term ending on January 31, 2010. cc: Diane Jennings, Staff Liaison Respectfully submitted, .~~ o Jojola Gonsalves Deputy City Clerk P.O. Box 10250 Palo Alto, CA 94303 650.329.2571 650.328.3631 fax TO: HONORABLE CITY COlTNCIL CITY MANAGER DATE: MAY 11,2009 REPORT TYPE: CONSENT ITEM DEP ARTMENT: PLANNING AND COMMUNITY ENVIRONMENT CMR: 216:09 SUBJECT: Approval of Amendment No. Two to Agreement with the Housing Trust of Santa Clara County to Provide a Contribution in the Amount of $100,000 from the Residential Housing Fund for Fiscal Year 2008- 09 and to Allow for Expenditure of City Contributed Funds for Qualifying Loans and/or Grant for Housing in Palo Alto through FY 2013/14 RECOMMENDATION Staff recommends that Council: 1. Approve Amendment No. Two to Agreement with the Housing Trust of Santa Clara County to Provide a Contribution in the Amount of $1 00,000 from the Residential Housing Fund for Fiscal Year 2008-09 and to Allow for Expenditure of City Contributed Funds for Qualifying Loans and/or grant for Housing in Palo Alto through FY 2013/14; and 2. Authorize the City Manager to execute the Amendment No. Two with the Housing Trust of Santa Clara County. BACKGROUND In 2000, the Housing Trust of Santa Clara County (HTSCC) was created to provide additional financial resources to address the County's affordable housing deficit. The Housing Trust's initial funding endowment of $20 million was met in two years and included contributions from public jurisdictions in the County, major employers and private foundations. On October 23, 2000, the City Council approved a contribution of $500,000 from the City's Residential Housing Fund, with the provision that the City's fund be used exclusively for qualifying affordable housing projects located within the City of Palo Alto. On May 7, 2001, the City entered into an agreement with HTSCC for the $500,000 contribution. On July 12,2004, the City amended the agreement with HTSCC to an additional $100,000 donation from the City for FY04/05 and an CMR: 216:09 lof3 additional $50,000 for FY 05/06. On June 9, 2008, the City Council adopted the budget for FY08/09 which includes an allocation of $1 00,000 from the Residential Housing Fund for a City contribution to HTSCC. DISCUSSION The City's participation in the Housing Trust has increased the available housing funding for Palo Alto projects. Since the execution of the Agreement with the City, the HTSCC has loaned approximately $1.589 million for three Palo Alto projects: $400,000 for the Oak Court Apartments (53 units), leveraging $20.1 million; and $650,000 for the Opportunity Center (89 units), leveraging $20.7 million, and $539,000 for Fabian Way Senior Housing (56 units), leveraging $22 million. The City's adopted FY08/09 budget includes an allocation of $1 00,000 from the Residential Fund to the HTSCC. Since the City has already entered into an agreement with the HTSCC and the terms for the use of the funds are unchanged, the existing Agreement needs only to be amended to reflect the additional contribution. RESOURCE IMPACT The contribution of $100,000 will reduce the Residential Housing Fund to approximately $527,000 from its available unrestricted current balance of approximately $627,000. POLICY IMPLICATIONS The recommendation furthers Comprehensive Plan policies that support addressing housing needs on a regional basis and working with outside agencies and other jurisdictions to develop and implement housing programs. ENVIRONMENTAL REVIEW This action is not considered a project subject to the California Environmental Quality Act since it would not cause a physical change in the environment. PREPARED BY: Senior Planner DEPARTMENT HEAD REVIEW: ~ ~ ClTRTIS WILLIAMS Interim Director Planning and Community Environment CITY MANAGER APPROVAL: CMR: 216:09 20f3 ATTACHMENTS Attachment A: Attachment B: Amendment No. Two to the Agreement between the City of Palo Alto and Housing Trust of Santa Clara County, Inc. Agreement between the City of Palo Alto and Housing Trust of Santa Clara County, Inc. COURTESY COPIES Housing Trust of Santa Clara County CMR: 216:09 30f3 ATTACHMENT A AMEfSJDMENT NO. TWO TO THE AGREEMENT NO Cl136231 BETWEEN THE CITY OF PALO ALTO AND HOUSING TRUST OF SANTA CLARA COUNTY, INC., a California Nonprofit Corporation This Amendment No. Two ("Amendment") to the Agreement No. Cl136232 ("Agreement") is entered into by and between the CITY OF PALO ALTO ("CITY"), and HOUSING TRUST OF SANTA CLARA COUNTY, INC., a California Nonprofi t Corporation, ("HTSCC") . RECITALS: WHEREAS, on May 7, 2001, between the parties regarding $500,000 to the Housing Trust County; and Agreement was entered into City's initial contribution of Fund Endowment of Santa WHEREAS, on July 12, 2004, the Agreement was amended to reflect an increase in amount of the Ci ty of Palo Al to 's contribution HTSCC by an additional $100,000 to be expended fiscal year 2004-05 and an additional $50,000 to be expended in fiscal year 2005-06; and WHEREAS, on April 16, 2007, time extension allowing for the contribution of $50,000 made in fiscal year 2009-10; and the Ci ty Counci I approved a expenditure of the City's fiscal year 2005-06 through WHEREAS, pursuant to the prOV1Slons of Section 12 of Article III of the of the City Palo Alto, the Council on June 9, 2008 did adopt a budget for Fiscal Year 2008/09; and WHEREAS, the City Council allocated $100,000 in Residential Housing Fund for Ci ty of Palo Al to's contribution to HTSCC for fiscal year 2008-09; and WHEREAS, expendi ture of 2008-09 through 090414 syn 0120343 the parties wish to the City's contribution scal year 2013-14. 1 extend the time for $100,000 made for in NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the parties agree: SECTION 1. Section 2 of the Agreement, entitled "Deposit of City's Residential Housing In-Lieu Funds into Endowment Fund" is hereby amended to read as follows: IICity agrees to depos the sum of $500,000 into the Endowment Fund within 30 days after the mutual execution and delivery of this Agreement. City agrees to deposit an additional sum of $100,000 within thirty (30) days after mutual execution of this Amendment No. One to the Agreement and, subject to appropriation by the City Council, and to deposit the sum of $50,000 by no later than thirty (30) days of the beginning of fiscal year 2005 06. The parties agree that the sum of $100,000 deposited within thirty (30) days after execution of Amendment No. One to Agreement shall be expended in fiscal year 2004 05 and the $50,000 to be deposited within thirty (30) days of the beginning of fiscal year 2005-06 shall be expended through fiscal year 2009-10, and the 00,000 to be deposited wi thirty (30) days of beginning of fiscal year 2008 09 shall be expended through fiscal year 2013-14 according to paragraph 3.2.2 of the Agreement. " SECTION 2. Except as herein modified, all other provisions of Agreement, including any exhibits and subsequent amendments thereto, shall remain in full force and effect. II II II II II II II 2 090414 syn 0120343 IN WITNESS WHEREOF: authorized representatives first above written. the parties executed this have by their duly Amendment on the date APPROVED AS TO FORM: Assistant City Attorney APPROVED: Director of Administrative Services Interim Director of Planning and Community Environment Insurance 090414 syn 0120343 3 CITY OF PALO ALTO Assistant City Manager HOUSING TRUST OF SANTA CLARA COUNTY, INC., a California Nonprofit Corporation By: Name: Title: By: Name: Title: Taxpayer Identi cation No. 77-0545135 (Compliance with Corp_ Code & 313 is required if the entity on whose behalf this contract is signed is a corporation. In the alternative, a certified corporate, resolution attesting to the signatory authority of the individual signing in their respective capacities is acceptable.) AGREEMENT BETWEEN CITY OF PALO ALTO AND ATIACHMENT B HOUSING TRUST OF SANTA CLARA COUNTY, INC. REGARDING A CONTRIBUTION TO THE SANTA CLARA COUNTY HOUSING TRUST FUND ENDOWMENT THIS AGREEMENT is made and entered into as of ~ 1 ' 2001, by and between THE CITY OF PALO ALTO (City) and HObSING TRUST OF SANTA CLARA COUNTY, INC .(" HTSCC") I a California nonprofit corporation. RECITALS A. The Housing Trust of Santa Clara County, In~. Endowment Fund (" Endowment Fund") I an investment pool fund in which private corporations and public agencies participate, has been created by the HTSCC for the purpose of establishing a revolving loan fund and grant-making program to address the issue of affordable, available housing in Santa Clara County. B. On January 22, 2001 the City Council of the City of Palo Alto adopted Budget Amendment Ordinance No. 4677 . The Budget Amendment Ordinance provides for the transfer of Five Hundred Thousand Dollars ($500,000) in Residential Housing In-Lieu Funds to the Endowment Fund. C. The City'~ Housing Reserve G~idelines require that the funds be used to provide assistance in expanding, preserving, or improving the supply of low and moderate housing in the City as defined in the City's Comprehensive Plan. D. The City desires to increase, improve, or preserve affordable housing for persons and families of low and moderate income in the City of Palo Alto, by participating in the Endowment Fund as specified in this Agreement. E. The purpose of this Agreement is to set forth the mutual agreement of the Ci ty and the HTSCC regarding the use of the Ci ty' s Residential Housing In-Lieu Funds through the 1 010427 syn 0090828 Endowment Fund. In view of the above, the parties agree as follows: SECTION 1. AUTHORITY AND STATUS OF HTSCC HTSCC . represents and warrants that the informat·ion contained in this Agreement is true and accurate to the best of its knowledge, and that it is a duly organized, validly existing nonprofit corporation in good .standing under the laws of its place of incorporation; that its signatory to this Agreement is authorized by resolution, bylaws, or constitution of the nonprofi t corpora tion, currently, in .. full force and effect ,to execute this Agreement on HTSCC's behalf. SECTION 2. DEPOSIT OF CITY'S RESIDENTIAL HOUSING IN-LIEU FUNDS INTO ENDOWMENT FUND City agrees to deposit the sum of $500, 000 into the Endowment Fund within 30 days after the mutual execution and delivery of this Agreement. SECTION 3. USE OF CITY'S RESIDENTIAL· HOUSING IN- LIEU FUNDS 3.1 HTSCC agrees that no fees will be charged to City's Residential Housing In-Lieu Mitigation Funds on depos in the Endowment Fund for administrative or overhead costs, including but not limited to fundraising expenses. The sole administrative expenses which may be charged to City's Residential Housing In-Lieu Funds on deposit in the Endowment Fund shall be as set forth in Section 6. 3.2 The Community Foundation Silicon Valley shall serve as the Endowment Fund's fiscal agent, and the City's funds shall be paid directty to· them. All disbursements of the City's Residential Housing In-Lieu Funds from the Endowment Fund shall be in the form of loans secured by a deed of trust recorded against the property. The HTSCC shall consult, in advance, with the City Manager of Palo Alto, prior to making any loans. The initial disbursement of the funds shall be used only for one or more projects that meet all of the following criteria: 3.2.1 The project must provide rental housing or housing for the homeless. A project to provide home ownership assistance is not eligible. 2 010427 syn 0090828 3.2 .2 The proj ect must increase, improve or preserve affordable housing, or housing for the homeless, in the 'City, of Palo Alto. 3.2.3 Such housing must be affordable to persons and families of low or very low income households as those terms are defined by the Department of Housing and Urban Development as pertains to the San Jose Metropolitan Statistical Area. 3.2.4 The HTSCC shall use the City's Residential Housing In-Lieu Funds to increase, improve or preserve affordable housing for homeless individuals and families and/or affordable rental housing for persons and ,families of low or very low income households, by methods of providing financial assistance that include, but are not limited to, the methods set forth in California Health and Safety Code Section 33334.2 (e), excluding subsections' (4) and (8). 3.2.5 Any new or substantia11y rehabilitated housing that developed, financed or assisted, in'whole or in part, with the City's Residential Housing In Lieu Funds shall remain available at affordable housing costs to persons and families 'of' low or very low income hous~holds, as ihe case may be, for the longest feasible time, but not less than thirty (3D) years for rental units. The HTSCC shall require the recording in the o'ffice of the County Recorder' of covenants or restrictions implementing this Section 3.2.5 for each parcel or unit of property subject to this Section 3.2.5, which covenants or restrictions shall run with the land and shall be enforceable against the original owner and successors in interest, by the City or the HTSCC. 3.2.6 shall be no discrimination against or segregation of any person, or group of persons, on account of race, color, religion, national origin, ancestry, gender, marital status, sexual preference, or handicap status in the sale, lease, sublease, transfer, use, occupancy, tenure or enj oyment of any such proj ect, qr any part thereof, nor shall any recipient of the Ci ty' s Resident 1 Housing In-Lieu Funds, or any person claiming under or through such person, establish or permi t any such practice or practices of discrimination or segregation wi th reference to the se ction, location, number use or occupancy of tenants, lessees, subtenants, sublessees, or vendees of any such project. 3 010427 syn 0090828 3.2.7 Th~ restrictions of thi~ Section 3.2 shall apply to the initial use of the City's Residential In-Lieu CHousing Funds by the HTSCC. 3.2.8 The HTSCC shall refund to the City any portion of the City Residential Housing In-Lieu Funds that have not been disbursed or contractually committed to be disbursed in accordance with this Section 3.2 by the date that is thirty-six . (36) months after the date of this Agreement. If the Ci ty' s Residential Housing In-Lieu Funds are disburs~d or contractually commi tted to be disbursed in accordance wi th this Section 3.2 within such 36-month period, the HTSCC shall have no obligation to repay any portion of the City's Residential 'Housing In-Lieu Funds to the City. 3.3 All disbursements by the HTSCC shall be made after'consultation with the City Manager of Palo Alto and with the advice and suggestion of the HTSCC Board o£ Directors which includes two members of the Santa Clara County Board of Supervisors. The HTSCC shall follow the recommendations regarding disbursements rendered by the Endowment Fund Steering Committee unless to do so would be a violation of law, this Agreement, or the HTSCC's Articles of Incorporation or Bylaws. SECTION 4. INVESTMENT OF THE FUND The HTSCC shall hold, manage, invest and reinvest the Endowment Fund in accordance with the "reasonably prudent person standard. Provided, inyestment 'of the funds contribut~d by the City under this Agreement shall be limited to money-market funds of the type described in Government Code Section 53601(k) (2). SECTION 5. FINANCIAL REPORTS 5.1 The HTSCC shall establish and accordance with complete record Endowment Fund. generally accepted accounting of 1 financial transactions maintain, in principles, a related to the 5.2 The HTSCC shall provide City with quarterly reports which shall set forth in detail all financial transactions' related to the Endowment Fund. The HTSCC shall also provide City with a copy of its audited report, prepared by independent certified public accountants annually. 4 010427 syn 0090828 5.3 The HTSCC shall provide City with a written report on the initial expenditure of the City's Residential' Hou~ing In Lieu Funds, including, at a minimum, for each project assisted with City's Residential Housing In-Lieu Funds, the following information: location and description of the assisted proj ect (s); number of units; rent and income restrictions; and term of restrictions. SECTION' 6. ADMINISTRATIVE FEES The HTSCC may charge 'an annual administrative fee equal to one percent (1%). of the fair' market value of the Endowment Fund against the Endowment Fund. The HTSCC may also charg~ against the Endowment Fund reasonable bank fees. One~Twelfth (1/12) of the annual fees will be ded~cted monthly. The HTSCC shall report the fees charged 'against the .Endowment Fund in its quarterly and annual reports. SECTION 7. NOTICES Any communication or notice which either party is required to send to the other or which either party desires to send to the other, shall be in writing and shall be ·either personally delivered or mailed in the United States mail, postage prepaid, to the respecti~e parties addressed as follows: City: HTSCC: City Manager City ot Palo Alto P.O. Box 10250 Palo Alto, CA 94303 Housing Trust of Santa Clara County, Inc. 111 West St. John.Street, Suite 710 San Jose, CA 95113 Either party may change its address by sending notice of the new address to the other party pursuant to this Section. SECTION 8. COMPLIANCE WITH ALL LAWS The HTSCC shall comply ordinances, codes and regulations local governments. 5 010427 syn 0090828 with all applicable laws, of the federal, state and SECTION 9. MISCELLANEOUS PROVISIONS A. The parties agree that this Agreement shall be governed and construed in accordance with the laws of. the State of California. In the event that suit shall be brought' by either party to, this Agreement, the parties agree that venue shall be exclusively vested in the state courts of th~ County of Santa Clara, or where otherwise appropriate, exclusi vely in the United States District Court; Northern District of California, San Jose, California.' B. ~he headings of the sections and subsections of this Agreement are inserted for convenience only. They do not constitute a part of this agreement and shall not be used in its construction. c. The waiver by any, party to this Agreement of a breach of any provision of this Agreement shall not be deemed ,a continuing waiver or a waiver of any subsequent breach of that or any other provision of this Agreement. D. Any and all ,exhibits, which are referred to in this Agreement, ,are incorporated herein by reference and are deemed a part of this Agreement. This Agreement may only be amended by formal written agreement executed by both parties. E. If a court of competent jurisdiction adjudges any provision of this' Agreement as void or unenforceable, the remaining provisions shall not be affected hereby and shall remain in full force and effect; provided that construction of the agreement without, the invalid or unenforceable provision does not deprive the parties of the benefit of their bargain. III II II II II II 6 010427 syn 0090828 Where this agreement refers to City and no Officer of the 'City is named, ·the City Manager. shall have the authority to act on the City's behalf. Frank nest City Manager Services 010427 syn 0090828 7 HOUSING TRUST OF SANTA CLARA COUNTY, INC. BY:~~ rlS Block Executive Director By: f-, ~ Name: {[. ~tM~ Title: 1'Ufo~Ul~ Taxpayer Identification No. 77-0545135 (Compliance with Corp. Code § 313 is required if the entity on whose behalf this contract is signed is a corporation. In the alternative, a certified corporate resolution attesting to the signatory authority of the individuals signing in their respective capacities is acceptable). CERTIFICATE OF ACKNOWLEDGMENT (Civil Code 1189) STATE OF e,AUfOWl er COUNTY OF ~~ ~ SSe On ~~Y ~ , 2001, before me, the undersigned, a Notary Public in and for said County and State, personally appeared fAtRASJV PIft5R. I3UJU· personally known to me or proved to me on the basis of satisfactory evidence to be· the person ('() whose name (~) is/aXe subscribed to "the wi thin instrument and acknowledged to me that he/~e/th~y executed the same in his/hir/t~ir authorized capacity (i~), and that by his/h«/t~ir signature (~ on the trument the person r{.), or the entity upon "behalf of which the person(¥) acted, executed the instrument. 010427 syn 0090828 WITNESS my hand and official seal . ., lB3! C. LUI L I. 1 7 ,.1ID57 I Si III n n. .c.rror.lIa ~ ---County -_CU.i' .... Jan 16,2004 ~ 8 CALIFORNIA ALL.PURPOSE ACKNOWLEDGMENT . ~ ..... -'0(: ..... ,.. .... .... -.. .-.... '" .....-. 'i) ~' I State of California } _()--'-A-'--._'..rf ____ --"'-'~~"'-'--___ ss. County of ...,:) f'J' 'I\. ~ " " Place Notary Seal Above o personally known to me ~ proved to me on the basis of satisfactory (evidence to be the person~ whosename(~ is/~ subscribed to the Wi~th' 'nstrument and acknowledged to me tha ~/~y executed the same in his/ti r/t~ir authorized capacity(~), and that by his/h~/th~ signature(~ on the instrument the person~, or the entity upon behalf of which the person))(,) acted, executed the instrument. ---------------------OPTIONAL--------------------- Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. ____ ~~~~~~~------____ --____ NumberofPages: __ --~~------ Capacity(ies) Claimed by Signer Signer's Name: eo fiE£;[ ..s!le1?l1t:tJ2 C Individual ~ Corporate Officer --Title(s): 1Jt1;1tSUWP b' Partner -D Limited 0 General o Attorney in Fact o Trustee o Guardian or Conservator o Other: ______ ---'--___________________ _ RIGHT THUMBPRINT OF SIGNER Top of thumb here Signer Is Representing: ______________________________________ '--____ --' , ........ --' -=:::::;. ii.;;iiJ ,=,,_, )1 )J lJ © 1999 Natlonal Notary Association' 9350 De Solo Ave,. P.O, Box 2402' Chatsworth, CA 91313·2402' www,nBtionalnolary.org Prod. No, 5907 Reorder: Call TolI·Free 1·aoo-a71H3827 NOT YET APPROVED 1 090507 syn 6050539 Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Repealing Chapter 5.30 (“Chlorofluorocarbon - Processed Food Packaging”) and Adding a New Chapter 5.30 (“Expanded Polystyrene and Non-Recyclable Food Service Containers”) to Title 5 (“Health and Sanitation”) of the Palo Alto Municipal Code The Council of the City of Palo Alto does ORDAIN as follows: SECTION 1. Findings and purpose. The Council finds and declares as follows: (a) The prevalent use of polystyrene as a food service container product is increasing, largely bolstered by its affordability; however, production costs continue to rise due to increasing crude oil prices. While the California Integrated Waste Management Board (CIWMB) estimates that Californians use 165,000 tons of polystyrene each year for packaging and food service purposes alone, there is currently no economically feasible means of recycling the product in the City of Palo Alto. According to a 2000 CIWMB study only 0.2% of polystyrene food service packaging is recycled statewide. (b) There are two types of polystyrene commonly used as food service containers: oriented polystyrene (clear and rigid) and expanded polystyrene (opaque foam). The Palo Alto community throws away approximately 305 tons of expanded polystyrene containers each year, according to a Palo Alto Waste Composition Study conducted in May 2006. The Palo Alto Recycling Center has never been able to accept expanded polystyrene food service containers, and expanded polystyrene food service containers are not compatible with the new commercial composting service that commences on July 1, 2009. (c) On January 12, 2009, the Palo Alto Recycling Center stopped accepting expanded polystyrene peanuts and expanded polystyrene blocks commonly used for consumer goods packaging. Expanded polystyrene peanuts and expanded polystyrene blocks are considered to be more amenable to recycling than expanded polystyrene food service containers. Ongoing logistical and quality control challenges related to the minimal recycling market for expanded polystyrene make even the recycling program for peanuts and blocks infeasible. All expanded polystyrene materials must now be disposed of in a landfill. (d) Although expanded polystyrene is considered an inexpensive and effective product, it has many drawbacks and hidden costs which are deferred to the public and the environment. Food service polystyrene is a one-time use product that degrades extremely slowly in nature. Expanded polystyrene litter is not easily contained and is NOT YET APPROVED 2 090507 syn 6050539 often conveyed through storm drains to local creeks, the San Francisco Bay and the Pacific Ocean. Polystyrene waste constitutes 15% of the litter collected in storm drains, and is the second most abundant type of marine debris according to a 2004 CIWMB study. (e) Expanded polystyrene foam presents unique management issues because it is lightweight, floats, resists biodegradation, and easily breaks into smaller pieces. These small pieces, similar in size to plankton, are ingested by marine wildlife, leading to reduced appetite and nutrient absorption and possible death by starvation. According to a United Nations Environment Global Program of Action study, at least 162 marine species including most seabirds are reported to have eaten plastics and other litter. (f) On February 11, 2009, the San Francisco Bay Regional Water Quality Control Board listed two Palo Alto creeks, San Francisquito Creek and Matadero Creek, as having water quality that is impaired by trash, as defined by the Clean Water Act. The staff report recommending that the creeks be listed identifies expanded polystyrene as being one of the types of trash responsible for the impairment. (g) Both of the major chemicals used to produce expanded polystyrene, Benzene (a known human carcinogen) and Styrene (a possible carcinogen and neurotoxin), are suspected by the EPA and FDA to leach from polystyrene food containers, posing a threat to the environment and human health. (h) The City of Palo Alto desires to protect the natural environment, the health of its citizens, and the economy. This includes exercising environmental stewardship by reducing the amount of expanded polystyrene and non-recyclable plastic released into the City’s ecosystem and beyond. (i) Non-recyclable materials pose a challenge to any environmentally and fiscally responsible solid waste management program. Regulation of food packaging is necessary to encourage a recyclable waste stream and to reduce the disposal of solid waste and the economic and environmental costs of waste management. (j) It is the intent of the Council to reduce the negative impacts of expanded polystyrene food service containers and encourage the use of recyclable alternatives through the implementation of this Ordinance. SECTION 2. Chapter 5.30 (Chlorofluorocarbon – Processed Food Packaging) of the Palo Alto Municipal Code is hereby repealed in its entirety and a new Chapter 5.30 is added to read as follows: // // // NOT YET APPROVED 3 090507 syn 6050539 Chapter 5.30 EXPANDED POLYSTYRENE AND NON-RECYCLABLE FOOD SERVICE CONTAINERS Sections: 5.30.010 Definitions 5.30.020 Prohibitions on the Use of Expanded Polystyrene and Non-Recyclable Plastic 5.30.030 Exemptions 5.30.040 Operative Dates 5.30.050 Severability 5.30.060 Penalties 5.30.070 Construction and Preemption 5.30.010 Definitions. (a) “City facilities” refers to any building, structure or vehicle owned or operated by the City of Palo Alto, its agents, departments and franchises. (b) “Disposable food service container” means single-use disposable product used by food vendors for serving or transporting prepared and ready-to-consume food or beverages. This includes but is not limited to plates, cups, bowls, lids, trays and hinged or lidded containers. This does not include single-use disposable straws, utensils, or hot cup lids. (c) “Expanded Polystyrene” means a thermoplastic petrochemical material utilizing the styrene monomer, marked with recycling symbol #6, processed by any number of techniques including, but not limited to, fusion of polymer spheres (expandable bead polystyrene), injection molding, form molding, and extrusion-blow molding (extruded foam polystyrene), sometimes incorrectly called Styrofoam®, a Dow Chemical Company trademarked form of polystyrene foam insulation. In food service, expanded polystyrene is generally used to make cups, bowls, plates, and trays. (d) “Food vendor” means any establishment, located or providing food within the City of Palo Alto, which provides prepared and ready-to-consume food or beverages, for public consumption including but not limited to any store, supermarket, delicatessen, restaurant, retail food vendor, sales outlet, shop, cafeteria, catering truck or vehicle, sidewalk or other outdoor vendor, or caterer. (e) “Non-Recyclable Plastic” means all plastics that do not meet the definition of “Recyclable Plastic”. NOT YET APPROVED 4 090507 syn 6050539 (f) “Prepared food” means any food or beverage prepared for consumption using any cooking, packaging, or food preparation technique, including but not limited to cooking, chopping, slicing, mixing, freezing, squeezing, or brewing, and which requires no further preparation to be consumed. Prepared food includes uncooked fruits or vegetables and any “take-out” food, or food consumed off the food vendor’s premises. Prepared food does not include any uncooked meat, fish, poultry, or eggs. (g) “Recyclable Plastic” means all plastics that can be recycled, salvaged, composted, processed, or marketed by any means other than land-filling or burning, whether as fuel or otherwise, so that they are returned to use by society. Recyclable plastics include any plastic which can be feasibly recycled by the City’s municipal recycling program and presently is limited to those plastics with the following recycling symbols: #1 - polyethylene terephthalate (PET or PETE), #2 - high density polyethylene (HDPE), #3 - polyvinyl chloride (PVC), #4 - low density polyethylene (LDPE), #5 - polypropylene (PP), #6 – polystyrene, except for the expanded version of polystyrene, and #7 - other plastics, including compostable plastics such as polylactic acid (PLA) For purposes of this Chapter, Recyclable Plastic does not include expanded polystyrene labeled with recycling symbol #6. 5.30.020 Prohibition on the Use of Polystyrene and Non-Recyclable Plastic. (a) Except as provided by section 5.30.030 food vendors are prohibited from providing prepared food in disposable food service containers made from expanded polystyrene or non-recyclable plastic. (b) Except as provided by section 5.30.030 all City facilities, City managed concessions, City sponsored events, and City permitted events are prohibited from using disposable food service containers made from expanded polystyrene or non- recyclable plastic. (c) Nothing in this Ordinance shall be interpreted to restrict the use of any form of fiber or paper disposable food service container, or the use of any form of biodegradable or compostable plastic food service container that meets the definition of Recyclable Plastic, in Section 5.30.010(g). 5.30.030 Exemptions (a) Foods prepared or packaged outside the City of Palo Alto are exempt from the provisions of this Chapter. Purveyors of food prepared or packaged outside the City of Palo Alto are encouraged to follow the provisions of this Chapter. (b) Coolers and ice chests that are intended for reuse are exempt from the provisions of this Chapter. (c) The director of Public Works, or his/her designee, may exempt a food vendor from the requirements of this Ordinance for a period of one year, upon showing by the food vendor that the conditions of this Ordinance would cause an undue hardship. An “undue hardship” includes, but is not limited to situations unique to the food vendor NOT YET APPROVED 5 090507 syn 6050539 where there are no reasonable alternatives to expanded polystyrene or non-recyclable plastic disposable food service containers and compliance with this Ordinance would cause significant economic hardship to that food vendor, or cause the food vendor to be deprived of a legally protected right. (d) A food vendor seeking an exemption application shall include all information necessary for the City to make its decision, including but not limited to documentation showing the factual support for the claimed exemption. The Director may require the applicant to provide additional information to permit the Director to determine facts regarding the exemption application. (e) Emergency Supplies and Service Procurement. City facilities, food vendors, City franchises, contractors and vendors doing business with the City shall be exempt from the provisions of this chapter, in a situation deemed by the City Manager to be an emergency for the immediate preservation of the public peace, health or safety. 5.30.040 Operative Dates. All food vendors and City facilities must comply with the requirements of this Ordinance by April 22, 2010. 5.35.050 Severability. If any provision or clause of this chapter is held to be unconstitutional or otherwise invalid by any court of competent jurisdiction, such invalidity shall not affect other provisions of this chapter, and clauses of this chapter are declared to be severable. 5.35.060 Penalties (a) Anyone violating or failing to comply with any of the requirements of this Chapter shall be guilty of an infraction as set forth in Chapter 1.08 of the Palo Alto Municipal Code. (b) Each and every sale or other transfer of disposable food service containers made from expanded polystyrene or non-recyclable plastic shall constitute a separate violation of this Ordinance. (c) The remedies and penalties provided in this Section are cumulative and not exclusive. 5.35.070 Construction and Preemption This Chapter and any of its provisions shall be null and void upon the adoption of any state or federal law or regulation imposing the same, or essentially the same, limits on the use of prohibited products as set forth in this Chapter. This Chapter is intended to be a proper exercise of the City’s police power, to operate only upon its own officers, agents, employees and facilities and other persons acting within its boundaries, and not to regulate inter-city or interstate commerce. It shall be construed in accordance with that intent. Deleted: within one year of Deleted: its effective date Deleted: NOT YET APPROVED 6 090507 syn 6050539 SECTION 3. The City Council finds that the adoption of this Ordinance is subject to environmental review under provisions of the California Environmental Quality Act (CEQA) under Section 15070 of the CEQA Guidelines, (“Decision to Prepare a Negative or Mitigated Negative Declaration”). The Department of Planning and Community Environment prepared an Initial Study for this Ordinance, which confirmed that the Ordinance does not have the potential to result in a significant impact on the environment. Consequently, a Negative Declaration was prepared, made available for public review beginning August 29, 2008 through September 17, 2008 and is hereby adopted. SECTION 4. This ordinance shall be effective on the thirty-first day after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ____________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ____________________________ ____________________________ Deputy City Attorney City Manager ____________________________ Director of Public Works ____________________________ Director of Administrative Services TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DATE: May 11,2009 REPORT TYPE: . PUBLIC HEARING DEPARTMENT: PLANNING AND COMMUNITY ENVIRONMENT CMR: 212:09 SUBJECT: Adoption of Ordinance Amending Chapter 5.24 (Requirements to Divert Construction and Demolition Waste from Landfill) of Title 5 (Health and Sanitation) of the Palo Alto Municipal Code to Increase Diversion Requirements. EXECUTIVE SUMMARY This item was postponed from the April 27, 2009 Council meeting, due to a lack of time. The amendments would (a) require that all C&D debris be diverted to an approved reuse, recovery or similar facility, (b) maintain the minimum current recovery rate requirement at approved facilities of 90% for inert debris, (c) increase the rate for all other C&D materials from 50% to 75%, and (d) increase the number of covered projects by changing from a $75,000 threshold to a $25,000 threshold valuation. All amendments to the ordinance will go into effect 30 days following the second reading of the ordinance except the requirenlents for new projects covered between $25,000 and $75,000 valuation. For these projects the requirements will be enforced beginning January 1, 2010; and until that time will be voluntary. The attached redlined ordinance includes a section (5.24.120 Operative Date) which defers compliance for these minor projects, and an additional purpose statement (Section 1 (d)) which emphasizes salvage. Staff will return with recommended changes to the administrative penalty schedule for noncompliance with this ordinance. The amendments would also increase consistency with current City, regional, state and national policies, language, and programs. Council received the fourth annual C&D Debris Diversion Program informational report on April 2i\ and it is also included as an attachment. RECOMMENDATIONS Staff recommends that Council approve the amendments to the Construction and Demolition Debris Diversion Ordinance comprising Chapter 5.24 of the Municipal Code (Attachment A). BACKGROUND Construction and Demolition (C&D) debris is waste material that is produced during construction, renovation, or demolition of structures. Components of C&D debris typically include concrete, asphalt, wood, metals, gypsum wallboard, roofing material, glass, carpet, bricks, land clearing debris (e.g. trees, stumps and vegetation.), rocks and dirt. Cardboard and plastics (e.g. shrink-wrap) are also generated at construction sites as a result of packaging from products utilized in the final stages of construction. On May 17, 2004, the City Council approved a Construction and Demolition (C&D) Debris Reuse and Recycling Ordinance to require that a minimum of 90 percent of inert solids (e.g. concrete, asphalt, and rock) and a minimum 50 percent of remaining debris generated from C&D projects be diverted from CMR: 212:09 Page 10f5 landfill disposal through reuse and/or recycling. The original ordinance outlines the environmental and health benefits of diverting C&D waste from the landfill. Covered projects were defined as those needing . a demolition permit and having a project valuation of $75,000 or more. The driving forces behind the ordinance were the California Integrated Waste Management Act of 1989, and Senate Bi111374 (2002), which requires annual reporting to the state on progress made in the diversion of C&D waste materials, including information on programs and ordinances implemented and quantitative data, where available. The City is required to meet the State's 50 percent diversion requirement, or may be subject to a fine of up to $10,000 per day. The program was also enacted as a key component of implenlenting the City's Zero Waste Plan. Since the May 17, 2004 ordinance was approved, the following has occurred; • A dedicated staff position was created to fUll, implement, and enforce the C&D program requirements, with a fee structure ($225 per project) designed to recover about 75% to 80% of program costs. • The program has completed four successful years of program implementation, resulting in the diversion of over 100,000 tons of debris from the landfill. • The number of Bay Area C&D debris reuse and recycling facilities has increased. • The building design and construction community has successfully adjusted to diverting waste from landfill disposal. • The City Council has deemed environmental protection as one of its top three priorities for each of the , last two years. • The City'S Climate Protection Plan (CPP), adopted by the City Council on December 3, 2007, identifies Zero Waste as an inlportant approach to reducing greenhouse gas emissions generated in the Palo Alto community. The CPP specifically calls for a City diversion rate of73% by 2011, increased salvage for reuse of materials, and an increase in projects covered under the C&D ordinance. • On March 1, 2009 the Palo Alto Landfill discontinued accepting commercially generated waste, including C&D debris. This restriction presented an opportunity to redirect this landfilled debris by increasing salvage for reuse and recycling requirements for smaller projects. DISCUSSION The proposed ordinance amendments were driven by the following goals to increase effectiveness of the C&D program: • Increase the C&D Debris Diversion requirements • Increase the number of covered projects • Improve compliance • Relate penalties to amounts to be diverted to encourage compliance • ClarifY definitions and general language for consistency with State and National regulations and programs Increase the Construction and Demolition Debris Diversion Requirements As stated above, the current C&D debris diversion requirements include (a) salvage for reuse, (b) the recycling of 90 percent of inert solids (i.e. concrete, asphalt, and rock) and (c) recycling a minimum 50 percent of the remaining debris generated from covered projects. To minimally comply, 50 percent of a covered project's debris may be sent to the landfill, and the remaining 50 percent may be salvaged for· reuse or recycling at an approved facility. The proposed amendments to the ordinance would continue to require that all covered projects salvage debris for reuse, but in addition they would need to send 100 percent of the debris (increased from 50 percent) to an approved reuse and/or recycling facility. CMR: 212:09 Page 2 of5 Commensurate with this proposed anlendment, the requirements for qualifying as an approved facility would also be increased. If a facility accepts inert solids (e.g. concrete, asphalt), the overall minimum recovery rate for that facility must still be 90 percent in order to be approved. For facilities accepting all other non-hazardous C&D debris, the minimum facility recovery rate for approval would be increased from 50 percent to 75 percent. A facility would also have to maintain its licenses to operate, implement a hazardous waste inspection program, and update the City on any diversion rate changes, among other requirements to be approved for purposes of the City's program. Staff currently maintains a list of approved facilities, and new facilities may be approved that meet the requirements of the ordinance. In addition, to ease the burden of maintaining this list and to avoid redundancies, staff also proposes to include facilities approved by the State, and other local counties and cities found to be equivalent in spirit and stringency to those of the City's Ordinance requirements. Increase the Number of Covered Projects (Decrease the Threshold Valuation) All projects with a valuation greater than $75,000 requiring demolition permits are considered covered proj ects under the current C&D debris ordinance. The proposed amendments would expand the scope of covered projects to include any project requiring a permit for new construction as well as any projects with a valuation greater than $25,000 and requiring a building permit. Based on building permit statistics from the 2008 calendar year, lowering the threshold of covered projects to $25,000 from $75,000 would have captured an additional 292 projects over and above the 531 projects that were covered by the existing ordinance between November 2007 and November 2008. Assuming similar building trends continue, decreasing the threshold to $25,000 could increase the number of covered projects by almost 55 percent. Projects in the $25,000 -$75,000 range include, as examples, residential bathroom and/or kitchen remodels, large roof replacements, additions on existing structures, new garages, and small commercial remodels. Staff is concerned, however, that the C&D review should not become a burden in time delay or cost for these small projects, and has discussed implementing three program components to minimize these impacts: 1. Minor building permits issued "over the counter" would not be delayed as long as the C&D paperwork (regarding estimated waste and signed acknowledgements) is complete. 2. The $225 C&D fee would be reduced to a nominal $75 for all permits with valuations of $25,000 to $75,000. (Note: if there is no demolition or debris involved, the C&D requirement and fee would not apply). 3. The implementation and compliance with C&D requirements for these smaller projects would be considered voluntary through December 31, 2009, and would then become fully effective (as well as the fee) on January 1,2010. This will also provide additional time for outreach to architects, contractors, and homeowners. Improve Compliance The amendments require that covered projects divert 100 percent of the C&D debris to an approved facility or utilize other acceptable methods to salvage for reuse. In order to become and to stay approved, a facility must maintain diversion rates that meet city standards. Therefore, the burden on the applicant to monitor and calculate diversion rates is reduced. The amendments require that all receipts or weight tags used to show compliance with the C&D program be originals, or have the address or permit number printed directly on them by the approved facility. This CMR: 212:09 Page 3 of5 requirement ensures that contractors will not submit the same receipts multiple times for different projects. Differentiate Penalties by Offense Currently, covered projects that do not comply with the ordinance are subject to a $1,000 fine as outlined in the Administrative Penalties Schedule. While a $1,000 fine provides incentive for smaller projects to comply, for larger projects, it is relatively inexpensive to avoid compliance. The ordinance amendments include an innovative way to differentiate penalties by size of offense, a method used by a number of other cities. The proposal would fine a covered project by the number of tons an applicant fails to divert, rather than a flat penalty of $1,000. Staff will recommend a $50 per ton, minimum $1,000 penalty when amendments to the administrative penalty schedule are proposed in June. The number of non-complaint appli~ants each year varies. A rough estimation is that about 5%-10% of applicants, most of which are single fanlily home owners do not comply currently. There are some other cities where a fine is not used as a penalty, and a deposit is made up front, which is not returned if the project is non-compliant. Due to the impact on applicants, and based on the administrative costs of running a deposit program, this approach was not recommended in 2004 and is not recommended in the proposed amendments. Clarify Definitions and General Language for Consistency with State and National Regulations and Programs The ordinance amendments include added and revised language and definitions that are consistent with regional, state and national terms and programs. For example, the term "Debris Management Plan" was replaced with "Waste Management Plan (WMP)", the term more commonly referred to for estimating construction debris ( or waste) and laying out a salvage for reuse and recycling plan. RESOURCE IMPACTS Additional staff time will be required to review, monitor and approve the 250 to 300 additional applications (approximately 50 percent increase) for minor projects subject to the ordinance, and to maintain and monitor the approved facility list. With approximately 250 to 300 additional applications, however, revenues could increase by approximately $15,000 to 20,000 per year, given the proposed $75 fee for covered "minor" projects under the ordinance ($7,500 in FY 09-10 due to deferred implementation). Staff notes that the current funding and revenues for this program are associated with the City's Refuse Fund, rather than the General Fund. Staff believes that, due to the state of the economy and City finances, the increased work load could be covered by current staff administering the C&D Debris Diversion program; however, long-term, an additional 1.0 FTE, bringing the total to 2.0 FTE, will most likely be needed to effectively run the C&D (1.0 FTE) and Green Building (1.0 FTE) programs. In the interim, one Planner position in the Current Planning section would be dedicated at least half-time to implementing the Green Building ordinance, outreach, and monitoring efforts. The increase in revenues collected should nearly result in full cost recovery for the C&D Debris Diversion program. Any incremental staff cost for C&D implementation would continue to be provided from the Refuse Fund. POLICY IMPLICATIONS These recommendations are consistent with the following existing City policies. CMR: 212:09 Page 4 of5 Zero Waste On November 15, 2004, the Palo Alto City Council directed City staff to prepare a Zero Waste Plan for the Palo Alto community. The goal of Zero Waste is to reduce the amount of waste going to landfills by 90% or more. The Zero Waste Plan is an integral component of the City's Climate Protection Plan, adopted by Council in December, 2007. Green Building Ordinance The Green Building Ordinance, adopted by the City Council in May 2008 rewards, requires, and encourages minimum levels of C&D debris diversion along with many additional measures that improve the natural environment and human health. Climate Protection Plan The Climate Protection Plan, adopted by the City Council in Decerrlber 2007, specifically calls out amending the current C&D debris diversion ordinance to increase salvage for reuse and requires at least 75 percent of C&D debris to be diverted from the landfill as a goal toward becoming a Zero Waste Community. Comprehensive Plan Comprehensive Plan Policy Goals N-7, N-43, N-35, N-36 address reducing the volume of solid waste, as well as increasing reuse and recycling. Sustainability Policy The City of Palo Alto Sustainability Plan, adopted in support of the citywide Sustainability Policy, identified Solid Waste as one often key categories of sustainability focus. ENVIRONMENTAL REVIEW The proposed amendment is categorically exempt from review under the California Environmental Quality Act (CEQA). ATTACHMENTS A. Ordinance Amending Chapter 5.24 (Requirements to Divert Construction and Demolition Waste from Landfill) of Title 5 (Health and Sanitation) of the Palo Alto Municipal Code B. April 27, 2009 informational report regarding C&D debris diversion program PREPARED BY: DEPARTMENT HEAD: CITY MANAGER APPROVAL: CMR: 212:09 ~O~tH ~N· Associate Planner CURTIS WILLIAMS Interim Director of Planning and Community Environment Page 5 of5 TO: City of Palo Alto City Manager's Report HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: PLANNING AND COMMUNITY ENVIRONMENT DATE: MAY 11,2009 CMR: 238:09 REPORT TYPE: REPORT OF COMMITTEES AND COMMISSIONS SUBJECT: Policy and Services Committee Recommendation to Approve Proposed Procedure for Appointment of Santa Clara Valley Transportation Authority (VTA) Board Members from the Six North County Cities EXECUTIVE SUMMARY The VTA Board of Directors is composed of 12 members from five city groupings. Group 2, including six north county cities (Palo Alto Mountain View, Sunnyvale, Santa Clara, Los Altos and Los Altos Hills), has 3 seats on the VTA Board. For the past ten years, the North County Group Board appointments have been rotated among the six cities. The VT A Board has directed that each grouping may reevaluate how the groups select appointees to the Board. The North County Cities representatives (all VTA Policy Advisory Committee members and elected Council Members from their respective cities), have proposed procedures for the North County cities to nominate and elect qualified nominees to two year terms using rank-choice voting, with a weighting formula based on the population of the voting member's city. The Policy and Services Committee reviewed the policy, made modifications, and recommends Council approval of the policy as modified. Sunnyvale, Los Altos, and Mountain View have endorsed the proposal. Los Altos Hills endorsed the selection process, but did not endorse a weighted balloting, preferring a "one city, one vote" protocoL The City of Santa Clara has not yet taken action on the matter. RECOMMENDATION The Policy and Services Committee· recommends that the City Council approve the proposed procedures for appointment of Santa Clara Valley Transportation Authority Board Members from the Six North County cities as outlined in Attachment A with the following additional four points: 1. Clarification that the representative bring forward to the full Board all of the concerns from the entire North County. 2. The North County grouping must meet a minimum of four times per year. 3. The elected representative shall make diligent efforts to attend the North County grouping meetings. 4. The policy regarding procedures for appointment of Board Members should be reviewed every two years. CMR:238:09 Page 1 of3 10 COMMITTEE REVIEW AND RECOMMENDATIONS On March 16, 2009, the Policy and Services Committee considered the proposal put forward by the current VTA Policy Advisory Committee members from the North County cities group (Mountain View, Palo Alto, Los Altos, Los Altos Hills, Sunnyvale, and Santa Clara) for the selection procedure to appoint VTA Board members from the North County group. The current procedure of appointing board members from the North County on a rotational basis will end this year. The new procedure, based on the VT A Governance Committee proposal, calls for the North County cities to elect three qualified nominees and one alternate to two year terms using rank-choice voting, with a weighting formula based on the population of the voting member's city. The Committee discussed the deficiencies in the existing appointment procedures for Board members, the role of the Policy Advisory Committee and benefits of the new voting procedures for North County cities. The Committee also discussed the need for a periodic re-evaluation of the new appointment procedures to ensure that the city would get fair representation on the Board. Council Member Kishimoto proposed four amendments to the policy: (1) to clarify that the role of the North County representative is to bring all of the concerns of the North County to the VTA Board, (2) the North County group must meet a minimum of four times per year, (3) the North County representatives should attend the North County group meetings, and (4) the proposed policy should be reviewed every two years. The Committee voted (3 to 1, Barton voting no) to recommend the procedure recommended by the North County cities group representatives as amended as described in Attachment A of the staff report with Committee modifications as stated above. . RESOURCE IMPACT There are no resource impacts associated with this matter. POLICY IMPLICATIONS The City's role and interest in VTA Board structure and governance issues is consistent with Comprehensive Plan Policy T-49: "Lead and participate in initiatives to manage regional traffic." ENVIRONMENT AD REVIEW This is not a project under the California Environmental Quality Act. PREPARED BY: DEPARTMENT HEAD: CMR:238:09 G~KE~~------- Transportation Manager CURTIS WILLIAMS Interim Director of Planning and Community Environment Page 2 of3 CITY MANAGER APPROVAL: ATTACHMENTS JAMES KEENE City Manager A. Proposed Procedure for Appointment ofVTA Board Members from the Six North County Cities B. Staff report CMR 177:09 C. Minutes for March 16, 2009 Policy and Services Committee CMR:238:09 Page 3 of3 \ ATTACHMENT A Proposed Procedure for Appointment ofVTA Board Members from the Six "North County" Cities (City Group 2) Election Time Frame: In December of every odd year, the Policy Advisory Committee (PAC) members who represent the cities of Los Altos, Los Altos Hills, Mountain View, Palo Alto, Santa Clara, and SUllllyvale shall convene to hold an election to appoint three members and one alternate to the VTA Board, who will start serving a two-year term starting January 1 st of the following year. Should the PAC position for any of these cities be vacant at the time of the election, that city council may appoint a councilmember to participate in the election. Should the PAC member for any city be unavailable at the time of the election, but the PAC Alternate be available, the Alternate may vote on behalf of his or her city. Nomination Process: The six city representatives shall choose a presiding officer for the election at least a month in advance. The presiding officer will prepare ballots for the election, and either supervise the vote count or conduct it personally. Each city whose council includes at least one qualified nominee may nominate one of its qualified council members for the VTA Board. Such a city has the option of declining to nominate any of its councilmembers. A city with no qualified councilmembers may not make a nomination. Qualification of Nominees: The nominee from each city must be an incumbent city councilmember whose term limit, if any, extends at least to the end of the two~year VT A Board term under consideration. In order to satisfy the enabling legislation's requirement that tithe appointing powers shall appoint individuals who have expertise, experience, or knowledge relative to transportation issues,tl each nominee must meet at least one of the following criteria: • At least one year's service on the Transit District Board (the VTA Board or the County Board of Supervisors prior to 1994). • At least one year's service on a policy advisory committee that reports directly to the Transit District Board (the Policy Advisory Committee, the Citizens' Advisory Committee, or the former County Transportation Commission). • Any other transportation policy credential that has been approved in advance by the majority of the other Group 2 cities as meeting the intent of the experience requirement. A maximum of one nominee per city shall be allowed. Only one councilmember from any given city may serve on the VTA Board at any time. A VTA Board member may not serve simultaneously on the PAC in any capacity, but an Alternate member may simultaneously serve on the PAC. Quorum: Representatives from at least four of the North County cities must be present in order for the election to proceed. Presentations: All nominees will be given equal opportunities to present arguments for their election during the meeting,and before the election is held. The length of tinle per candidate shall be at the discretion of the presiding officer, with a minimum of two minutes. 1 Election Process: Election to the Board shall be accomplished by ranked-choice voting, using written ballots that display all nominee names, the city represented by the voting member, and that member's selections in order of preference. Each voter present shall vote by ranking his or her top three choices in order. A voting member must fill out all three choices in ord~r for the ballot to be counted. A ballot that does not include three choices ranked in order will be returned to the member for an opportunity to be filled out correctly. Tabulating Ballots: The ballots will be counted using the following rank/weighting formula: . Each first-choice candidate will be awarded three points multiplied by the population of the voting member's city in thousands (rounded to the nearest thousand). Each second-choice candidate will be awarded two points multiplied by population, and each third-choice candidate will be awarded a number of points equal to the city population in thousands. . The three candidates with the largest number of points shall be appointed to the Director positions, and the fourth-place candidate shall be appointed as the Alternate. Vacancies: Should one of the three Directors resign from the Board or cease to be a city councilmember, that seat shall be declared vacant. The vacancy will be filled immediately and automatically by the Alternate. The newly-open Alternate position shall be filled by a vote of the PAC members from the six cities using the ranked-choice voting procedure described above. Nominees for that position must meet the qualifications described above and may not come from the same city as any incumbent Director. Amendments: This document may be amended by a resolution approved by all six cities in the Group. A meeting of the North County Board and PAC members shall be convened after this procedure has been in place for ten years in order to evaluate the fairness of the selection process and the quality of the Board members chosen. 2 ATTACHMENT B City of Palo Alto City Manager's Report TO: HONORABLE CITY COUNCIL ATTN: POLICY AND SERVICES COMMITTEE FROM: CITY MANAGER DATE: MARCH 16,2009 DEPARTMENT: PLANNING AND COMMUNITY ENVIRONMENT ClVIR: 177: 09 SUBJECT: Recommendation on Proposed Procedure for Appointment of Santa Clara Valley Transportation Authority Board Members from the Six "North County Cities RECOMMENDATION Staff recommends that the Policy and Services Committee review the attached proposal and forward a recommendation or modification to the City Council regarding the proposed selection procedure for North County Cities Board Members on the Santa Clara Valley Transportation Authority (VTA) Board of Directors. BACKGROUND In 2007, the VT A contracted with the Hay Group to conduct a financial and organizational assessment ofVTA operations to strengthen the Board's effectiveness, governance, and financial management. The Hay Group report identified Board turnover and the length of Board Member tenns in office as a critical challenge to effective governance. " In particular, the report identified high Board turnover among the small city groups. Last summer, the VTA Board discussed a proposal from the Governance Committee for changing the structure and representation for the small city groupings. The proposed changes in governance included: expanding the small city groupings from 3 to 4 groups, based on geographic proximity and popUlation; dropping the practice of rotating seats within each grouping; encouraging the reappointment of Board members to a term totaling 4 years instead of 2 years; and developing a process of selecting VT A Directors with the required experience and qualifications. " The change in the number and geographical composition of the cities groups was not approved by the Board of Directors last summer, so the small city groupings remain unchanged. However, the VTA Board, as well as the Board's Policy Advisory Committee, concluded that the current system of rotating Board seats among the cities in each grouping is not effective. Each city grouping is required to select a new structure for selecting Board Members from the city grouping for the 2010 Board of Directors that will be seated in January 2010. CMR:177:09 Page 10f3 DISCUSSION The North County Cities group is comprised of the six cities of Palo Alto, Mountain View, Los Altos, Los Altos Hills, Santa Clara, and Sunnyvale. The group has 3 seats on the VTA Board of Directors, which are rotated using population as a factor for the frequency each city holds a seat. Currently, Council Member Kishimoto holds a seat on the Board for Palo Alto. The North County Cities Group discussed the proposed selection process (Attachment A) for North County Cities Board members at the January 29th monthly meeting. The members present from Mountain View; Palo Alto, Sunnyvale, Los Altos and Santa Clara voted unanimously to endorse the proposed selection procedures and to refer this matter to their respective City Councils for review and approval. If all of the North County cities adopt this new procedure, it would be im:elemented for the VTA Board membership for 2010. .- In brief, the proposal calls for the Policy Advisory Committee members from the six cities to elect three qualified nominees and one alternate to serve on the VTA Board from among qualified nominees from the North County cities. The City Councils from each city would nominate a Councilmember who has expertise, experience or knowledge related to transportation issues. This experience could be as a VTA Board or VTA advisory committee member or other pertinent transportation policy background. The Policy Advisory Committee vote will use a rank and weighting methodology tied to the population of voting members cities. The elected Board members would serve two-year terms. RESOURCE IMPACT There are no resource impacts associated with this matter. POLICY IMPLICATIONS The City's role and interest in VTA Board structure and governance issues is consistent with Comprehensive Plan Policy T -49: "Lead and participate in initiatives to manage regional traffic." ENVIRONMENTAL REVIEW This is not a project under the California Environmental Quality Act. ATTACHMENTS A. Proposed Procedure for Appointment ofVTA Board Members from the Six North County Cities B. Transmittal Email from Christopher Moylan .pREP ARED BY: Transportation Manager CMR:177:09 Page 2 of3 DEPARTMENT HEAD: ___ ~~Mi"'-'J.dk\~---,\1J--""~,---=-,,,' -==-.:.....c~, ___ _ CURTIS WILLIAMS Interim Director of Planning and Community Environment CITY MANAGER APPROV AL:_-1:~::::::'-'::::=-=====::::::=--~ _____ _ CMR:177:09 KELLY MORARIU Deputy City Manager .. Page 3 of3 ATTACHMENT A Proposed Procedure for Appointment of VTA Board lYlembers from the Six "North County" Cities (City Group 2) Election Time Frame: In December of every odd year, the Policy Advisory Committee (PAC) members who represent the 'cities of Los Altos, Los Altos Hills, Mountain View, Palo Alto, Santa Clara, and Sunnyvale shan convene to hold an election to appoint three members and one alternate to the VTA Board, who will start serving a two-year tenn starting January 1 st of the following year. Should the PAC position for any of these cities be vacarit at the time of the election, that city council may appoint a councilmember to participate in the election. Should the PAC member for any city be unavailable at the time of the election, but the PAC Alternate be available, the Alternate may vote on behalf of his city. Nomination Process: The six city representatives shall choose a presiding 'officer for the eledion at least a month in advance. The presiding officer will prepare ballots for the election, and either supervise the vote count or conduct it personally. Each city whose council includes at least one qualified nominee may nominate one of its qualified councilmembers for the VTA Board. Such a city has the option of declining to nominate any of its councilmembers. A city. with no qualified councilmembers may not make a nomination. Qualification of Nominees: The nominee from each city must be an incumbent city councilmember whose term limit, if any, extends at least to the end of the. two-year VTA Board term under consideration. In order to satisfy the enabling legislation's requirement that "the appointing powers shall appoint individuals who have expertise, experience, or knowledge relative to transportation issues," each nominee must meet at least one of the following criteria: • At least one year's service on the Transit District Board (the VTA Board or the County Board of Supervisors prior to 1994). • At least one year's service on a policy advisory committee that reports directly to the Transit District Board (the Policy Advisory Committee, the Citizens' Advisory Committee, or the former County Transportation Commission). • Any other transportation policy credential that has been approved in advance by the maj ority of the other G.roup 2 cities as meeting the intent of the experience requirement. A maximum of one nominee per city shall be allowed. Only one councilmember from any given city may serve on the VTA Board at any time. A VTA Board member may not serve simultaneously on theP AC in any capacity, but an Alternate member may simultaneously serve on the PAC. . Quorum: Representatives from at least four of the North County cities must be present in order for the election to proceed. 1 Presentations: All nominees will be given equal opportunities to present arguments for their election during the meeting, and before the election is held. The length of time per candidate shall be at the discretion of the presiding officer, with a minimum of two minutes. Elec1ion Process: Election to the Board shall be accomplished by ranked-choice voting, using written ballots that display all nominee naInes, the city represented by the voting member, and that member's selections in order of preference. Each voter present shall vote by ranking his or her top three choices in order. A voting member must fill out all three choices in order for the ballot to be counted. A ballot that does not include three choices ranked in order will be returned to the member for an opportunity to be filled out correctly. Tabulating Ballots: The ballots will be counted using the following rank/weighting fonnula: Each first-choice candidate will be awarded three points multiplied by the population of the voting member'S city in in thousands (rounded to the nearest thousand). Each second-choice candidate will be awarded two points mUltiplied by population, and each third-choice candidate will be awarded a number of points equal to the city population in thousands. The three candidates with the largest number of points shall be appointed to the Director positions, and the fourth-place candidate shall be appointed as the Alternate. Vacancies: Should one of the three Directors resign from the Board or cease to be a city councilrnember, that seat shall be declared vacant. The vacancy will be filled immediately and automatically by the Alternate. The neWly-open Alternate position shall be filled by a vote of the PAC members from the six cities using the ranked-choice voting procedure described above. Nominees for that position must meet the qualifications described above and may not come from the same city as any incumbent Director. Amendments: This document may be amended by a resolution approved by all six cities in the Group .. A meeting of the North County Board and PAC members shall be convened after this procedure has been in place for ten years in order to evaluate the fairness of the selection process and the quality of the Board members chosen. 2 ATTACHMENT B Likens, Gayle From: Sent: To: Subject: Emslie, Steve Friday, March 06, 2009 10:49 AM Likens, Gayle FW: Choosing our next VTA Board members Attachments: Draft North Cities Selection Process,doc; ATT1347404,htm Gayle, Page 1 Here is the draft VTA governance structure changes. We will need a very brief cover CMR for the packet next week as this is going to Policy and Services 3/16. Steve From: Yoriko Kishfmoto [mailto:ykishimoto@earthlink.netJ Sent: Friday, March 06, 2009 10:43 AM To: Emslie, Steve Subject: Fwd: Choosing our next VfA Board members Steve --here it is. Begin forwarded message: From: "Christopher R. Moylan" <cimoylan@comcast.net> Date: February 1, 2009 11 :56:04 PM PST ------------ To: <david,casas@alumni.pepperdine.edu>, <megan.satterlee@ci.los-altos,ca.us>, <becker lou@yahoo,com>. <jeanmordo@yahoo.com>, <breeoe@bkp.com>, <margaret.abekoga@mouotaioview gov>, <Ia,macias@mountainview gov>, <pdrekmeier@earthlink.net>, <yoriko. kishimoto@cityofpaloalto.org>, <Patrick. Burt@cityofpaloalto.org>. < Sid, Espinosa@cilyofpaloallo.org>. <IllilYoraodcouncil@ci.santa-clara.ca.us>. "Mayor Spitaleri" <counciltonyspitaleri@yahoo,com>, "'David Whittum'" <Yillittum@ieee.org> Subject: Choosing our next Vf'A Board members Dear colleagues, As you know, our six cities have been grouped together as a region for the purpose of representation on the Valley Transportation Authority Board of Directors. For the first ten years of the VT A's existence, the three Directors and one Alternate from our city grouping were determined by a rotation system that ends this year. It has been concluded by both the Policy Advisory Committee (PAC) and the VTA Board that the rotation system should not be reinitiated. Accordingly, our cities must choose their representatives by another method, A Governance Committee consisting of two Board members and four advisory committee members worked for several months in 2008 to come up with improved ,representation that might alleviate some of the governance problems identified by the 2004 county Grand Jury, the Hay Group consultants, and last year's state audit. The PAC agreed with the Grand Jury that the best solution would be a directly-elected Board, analogous to the Water District Board or the County Board of Supervisors, which would require changes to the enabling state legislation. The VT A Board has taken no position on the issue, and no stakeholder group has yet formed to work with our delegation in Sacramento to carry out that legislation change. The Governance Committee developed another alternative that would apply only to the five Directors appointed by the 14 cities other than San Jose, and this proposal was endorsed by the PAC as well. The Board has taken no position on this one either. This proposal would require approval by the majority of the cities in the county. representing a majority of the population (i.e. San Jose would have to vote for it). Page 2 of2 On Friday, January 29, the North County Cities present at our monthly meeting decided unanimously to follow the Governance Committee's recommended process within our own city grouping (i.e. for our three seats alone). Having served on the Governance Committee, I was asked to adapt the Committee's recommendation to the needs of our city grouping, and to send a draft document to interested councilmembers in all six cities. That document is attached. It is our hope that each city will endorse this plan so that we can carry it out by the end of the year, when we must choose our next set of Directors to represent us. Please discuss this plan with your council, if you have not already done so, and send me a letter from your mayor agreeing to the process on behalf of your city. If yourcity would like to request changes to the document, please let me know (any changes would have to go back to the other cities for approval). I shaH be happy to provide background or clarification on any portion of the draft If you would like me to send you a copy of the Governance Committee report, which goes into the background of the issue, "II be happy to do so on request. Please respond to me at my city email address below. . Sincerely, Chris Christopher R. Moylan Vice Mayor, City of Sunnyvale 456 West Olive Avenue Sunnyvale, CA 94088-3707 cmoylan@ci.sunnyvale.ca.us « » ATTACHMENT C POLICY AND SERVICES COlVIlVIITTEE Special Meeting Monday, March 16, 2009 The Policy & Services Committee of the City of Palo Alto met on this date in the Council Conference Room at 6:01 p.m. Present: Barton, Espinosa, Kishimoto, Schmid Absent: 1. Oral Communications Sanford Forte spoke regarding Council's enforcement for rules of decorum; City employees should not be attacked during public meetings, he urged the Committee to enforce the policy. Ronna DeVinchenzi, 2600 EI Camino Real #100, spoke regarding the rules of decorum. 2. Recommendation on Proposed Procedure for Appointment of Santa Clara Valley Transportation Authority Board Members from the Six North County Cities. Transportation Manager, Gayle Likens stated the Santa Clara Valley Transportation Authority (VTA) had been revisiting the structure of the Board of Directors in an effort to enhance membership. She noted the VTA had given Cities the ability to choose how they elected their Board Members. Council Member Kishimoto stated she had been involved with the VTA for eight years and was grateful to have a city with a full time transportation representative. She noted a disadvantage to the Board of Directors was the two-year term limit for each Board Member, remarking the expertise was at a constant shift. She stated the North County representation was made up of six cities, each year a delegate and an alternate from the grouping was selected to represent the entire North County for two years. She POLICY AND SERVICES COlVIMITTEE suggested entering new language into the procedures; clarifying the representative bring forward to the full Board of Directors the concerns for the entire Northern County grouping, the North County grouping meet a minimum of four times per year, the elected representative shall make diligent efforts to attend the North County grouping meetings, and the procedures be reviewed biannually. Council Member Barton stated the matter appeared to need simplifying. He stated there were six Cities in the North County grouping; the Group needed to selectively elect their representatives. He asked why a City without qualifications to be on the Board could not elect a member from another City to represent them as part of the North County group. Council Member Kishimoto stated each year a Policy Advisory Commissioner (PAC) was elected from each City to represent their City in the North County meeting. Chair Espinosa clarified there were two entities in play which created a more complex situation. The VTA had the Policy Advisory Committee which served as a training ground to serve as Board Members. He stated the Cities were grouped into regions due to specific issues or concerns for those areas. He noted the groupings needed' to meet regularly regarding their specific concerns then bring those concerns to the PAC for further discussion and clarification prior to Board involvement . . Council Member Schmid stated his concern was for Palo Alto not being properly recognized on the Board. He stated if the voting was weighted by population with Palo Alto being one of the smaller Cities, their ability to take a Board seat was less frequent. Council Member Espinosa stated that concern had been shared th'roughout other groupings and had been acknowledged by the Board which was why the current policy was being reviewed. Council Member Kishimoto provided clarification for her suggestion of implementing the review process every two to four years to verify each City was being treated fairly. POLICY AND SERVICES COy!lYlITTEE Council Member Schmid stated since the Board rotation was every two years that would be too short of a term for a review period. He suggested four years. Council Member Kishimoto altered her language to read "review the policy every two years for the first six years then extend the review process to every four years." Council Member Barton asked whether Los Altos Hills had VTA service outside of Arastradero and Foothill Expressway. Council Member Kishimoto stated the VTA serviced more than buses and trains, the services of VTA covered roads and bike lanes. Chair Espinosa stated there was a desire from the North County to have major governance structural changes that would benefit everyone involved with VTA. Council Member Kishimoto stated Measure B in 1993 created the Advisory Board made up of sixteen advisory members with five directly elected members with City and County representation. Council Member Barton stated he believed the five County Supervisors were directly elected to serve on the Board of Directors until 1997. Council Member Kishimoto stated she did not believe they were elected to serve on the VTA Board of Directors. Chair Espinosa stated the current role of Supervisor was under discussion within the policy. Council Member Barton asked why each City did not receive a vote. Council Member Kishimoto stated that had been suggested. She noted that each City served a seat on the PAC which gave them a voice. She stated each City's vote was proportionate to their population. POLICY AND SERVICES COlVIlVIITTEE Council Member Schmid asked whether the PAC's role was to give advice to the North County Board representative regarding the vote. Chair Espinosa stated the PAC consisted of representatives from each City that recommended policy changes to the full VTA Board. Council Member Schmid asked whether the PAC mandated the way the Board voted or just made recommendations to them. Council Member Kishimoto stated the PAC recommended but did not mandate the vote. MOTION: Council Member Kishimoto moved, seconded by Chair Espinosa to approve Staff recommendation to forward a recommendation to the City Council on the proposed selection procedure for North County Cities Board Members on the Santa Clara Valley Transportation Authority (VTA) Board of Directors, and to add the following four points: 1) Clarify the representative bring forward to the full Board all of the concerns from the entire North County 2) The North County grouping must meet a minimum of four times per year 3) The elected representative shall make diligent efforts to attend the North County grouping meetings 4) The policy should be reviewed every two years. Council Member Kishimoto stated her goal was to have all Cities and representatives involved work together for a common goal. Chair Espinosa stated at present there was not a strong enoug h support for anyone change proposed for Board adoption. Council Member Barton asked how the approach Palo Alto was currently taking compared to the possible approach being taken by other entities. Chair Espinosa stated there was a great fluctuation with the County groups. Some areas meet more frequently where others meet POLICY AND SERVICES COMlVIITTEE rarely, he stated it was dependent on the needs of that particular group. Council Member Kishimoto asked whether language could be entered into the policy determining after a predetermined amount of time, if Palo Alto was not getting proper representation on the Board, the policy would revert back to its original state. City Attorney Gary Baum stated the agreement which was being discussed was between six cities, once the agreement had been solidified it would need to be approved by the remaining five cities. Council Member Kishimoto stated she would alter her Motion to read after four years there would be a review of the policy, after . eight years the Council must take affirmative action on the approach or the policy reverted back to its original status. Chair Espinosa clarified Item No. 4 of the Motion was being set-up as a trial and would revert back to the original status of Board Member selection unless Council adopted the process. He asked what the timeframe was for Council to adopt the trial. Council Member Kishimoto stated the trial period would last eight years with a check-in at four years. Chair Espinosa stated eight years seemed a long time for a trial basiS. Council Member Barton asked whether the intent was for any City Council to amend the policy either at the check-in or after the eight years. He stated it read as though if any city felt they were not being fairly represented by the group they could review after four years and again if not satisfied by the representation could revert back to the original status. Council Member Kishimoto stated it was not obvious what the voting rules were which was her intent for the policy change. Chair Espinosa stated as seconder, he did not support the language change. He suggested it go as a separate vote. POLICY AND SERVICES COMMITTEE AMENDMENT: Council Member Kishimoto moved, seconded by XXX that item 4 of the Motion read after four years there would be a review of the policy, after eight years the Council must take affirmative action on the approach or the policy reverted back to its original status on selection of Board Members. AMENDMENT FAILED DUE TO LACK OF SECOND. MOTION PASSED: 3-1, Barton no TO: HONORABLE CITY COUNCIL FROM: CITY MANAGER DEPARTMENT: CITY MANAGER'S OFFICE DATE: MAY 11,2009 CMR: 243:09 SUBJECT: Adoption of a Resolution Opposing the State Department of Finance's Proposal to "Borrow" Local Government Property Taxes to Reduce the State's Budget Deficit for FY2010 RECOMMENDATION Staff recommends that the Council adopt the attached resolution (Attachment A to be distributed Monday, May 11) opposing the State Department of Finance proposal to "borrow" 8% of local government property tax revenues in FY2009 to reduce the State's budget deficit for FY20IO. DISCUSSION On May 5, 2009, the State Department of Finance issued a proposal (Attachment B) to the Governor that the State suspend Proposition IA (passed in 2004) and borrow 8% of local governments' property tax revenues and the triple flip sales tax allocation. These revenues can be borrowed by the state and repaid within three budget years with interest. The amount that can be borrowed is determined by the amount of property taxes received by cities, counties, and special districts in the preceding year. Borrowing from local government in FY2010 would provide approximately $2 billion of local revenues to the State. This one-time solution to the State's ongoing structural budget issues puts the burden on local governments and citizens who will have to address this revenue shortfall in addition to the local financial challenges already being faced. Cities throughout the State have already enacted painful cuts to balance their own budgets-including layoffs, furloughs, reduction of services, and project and maintenance delays. Palo Alto faces a budget deficit of $8 million in FY2009 and a deficit of $10 million in FY201O. A loss of additional property tax revenue could mean even deeper cuts in services to our local residents. The DOF proposal is fiscally irresponsible. Financing the State budget deficit with borrowing from local governments will only deepen the State's structural deficit. The State is obligated to repay the property taxes with interest within three years. However, borrowing does nothing to CMR: 243:09 Page 1 of3 address the structural budget issues currently facing the State. The State must figure out a method for balancing the budget using its own resources. City staff have been coordinating with the League of California Cities on a resolution opposing this proposal. Staff will provide this resolution and any additional information to the Council on Monday. It is important to note that the proposal has not been endorsed by the Governor at this point. Any resolution of the Council would make it known that the City opposes this proposal and encourages the Governor to reject it. Additionally, staff will work with the League of California Cities on other advocacy measures related to this issue and will keep the Council apprised of upcoming actions. RESOURCE IMPACT The adoption of this resolution by the Council does not have a resource impact. However, the proposal put forth by the State Department of Finance to "borrow" 8% of local government property tax revenues could have a significant impact on the City of Palo Alto. The proposal would take 8% of property VLF and the triple flip sales tax. According to the 2010 budgeted revenues, the impact on the City of Palo Alto is: Property Tax (includes VLF) Triple Flip (114 of sales tax) Total = $2.00 million $0.43 million $2.43 million Given that the City is already facing a budget deficit of $8 million in FY2009, this proposal would have a dramatic impact on Palo Alto services. It would force the Council and staff to reevaluate proposed cuts for FY2010 and determine which additional cuts to public safety and community services would need to be made. This could force the City to actually implement the worst case scenario Tier 2 cuts as identified in the City Manager's April 27 and May 5 budget presentations and identify additional reductions if the Council does not agree with the "bridge" recommendation. This could result in additional proposed reductions, such as: • Contracting out park and golf maintenance efforts • Eliminating the City's Police traffic team • Ending City shuttle service • Elimination of the Police School Resource Officer program • Eliminating the tree trimming contract • Eliminate Office of Emergency Services (OES) • Reduce Crime Analysis program • Reduce Community Policing/Outreach program ----------------------------------------------CMR: 243:09 Page 2 of3 The City Manager is already proposing to reduce City staffing by 20.5 positions for FY2010. These additional reductions could result in elimination of another 21 positions and employee layoffs. If the City's revenue outlook worsens, staff may need to identify even further reductions to programs and staffing above and beyond those outlined. The proposal by the State Department of Finance could have devastating impacts on the City when we are already challenged by the current economic climate. POLICY IMPLICATIONS This action is consistent with the Council's priority of Economic Health and the Council legislative guideline to protect local revenue sources. ENVIRONMENTAL REVIEW This report is not a project requiring review under the California Environmental Quality Act (CEQA). ATTACHMENTS Attachment A: Resolution of the Council of the City of Palo Alto Opposing the State Department of Finance's Proposal to "Borrow" Local Government Property Taxes to Reduce the State's Budget Deficit for FY2010 (to be distributed on Monday, May 11). Attachment B: State Department of Finance proposal outline PREPARED BY: CITY MANAGER APPROVAL: CMR: 243:09 IL KELL Y MORARIU Assistant to the City Manager Page 3 of3 Attachment B May 5, 2009 FOR IMMEDIATE RELEASE 1400 K Street, Suite 400. Sacramento, California 95814 Phone: (916) 658-8200 Fax: (916) 658-8240 www.cacities.org Contact: Eva Spiegel, (916) 658-8228 Cell, (530) 400-9068 Californians' Safety Threatened by Proposal to Borrow Local Property Taxes Sacramento, CA -Today the Department of Finance informed local officials they have prepared a May Budget Revision option for the Governor to consider that borrows 8 percent of local governments' property tax revenues, estimated at just over $2 billion, to help close the state's budget deficit. The proposal will threaten the safety of every Californian. The League will strongly oppose any proposal that puts the funding of state government ahead of the public safety of city residents. "This proposal is irresponsible and would have disastrous and long-lasting impacts. Cities are already redUCing services due to the recession and can't afford to cut public safety and other essential services to bail the state out," said League President and Rolling Hills Estates Mayor Judy Mitchell. Chris McKenzie, League Executive Director, added: "For most cities police and fire protection make up 60 -80% of their budgets." Californians know how important it is to maintain public safety. According to a Field Poll released April 30, seventy-four percent oppose cuts to law enforcement and police. DOF's proposal Significantly increases the likelihood cities will have to cut the very public safety services the voters want protected. The League called on the Governor to reject the DOF proposal. McKenzie said: 'The Governor has said repeatedly that borrowing local property taxes and Prop. 42 transportation funds is irresponsible. It only deepens the state's structural deficit and creates an obligation to repay. In the meantime, local services will be cut severely and citizens' safety will be put at risk. This is precisely the type of budgeting that California needs to avoid. The state needs to balance its budget within its own resources." The League of California Cities is prepared to fight vigorously to protect city services to the millions of Californians who live in cities. Established in 1898, the League of California Cities is a nonprofit statewide association that advocates for cities with the state and federal governments and provides education and training services to elected and appointed city officials. ### 2nnQ·10 Workload Budget Reductions Governor's Budget Program Description 2009-10 May Revision Option (Dollars in Thousands) Local Government Financing Title: Borrowing from Local Government GF 1 FF Other Total ! ! Reductions ! , ~ ; l 1 ~.~'_"~m,_,~·w·~._,~,,~·_·_··'·~·_····~·_·_·H' _ $2,006,000 $2,00 '~'''''_'''''''~''_'ft,,,,, PY Reduction _ '_'H'_"~'~'~'H'~"_'~'~'~"~'_'~'_"_' ._H' .. ' ...... ''''' .. ~. The cDnstitutiDn allDws that up to. 8% Df local gDvernments' prDperty tax revenues can be bDrrDwed by the state and repaid within three budget years with interest. The amDunt that can be borrowed is determined by the amDunt Df property taxes received by cities,.cDunties, and special districts in the preceding year. BDrrowing from IDcal gDvernment in the 2009-10 fiscal year wDuld prDvide $2.006 billiDn in sDlutiDns. Program Reduction An DptiDn to. address the pDtential budget shDrtfall wDuld be to. bDrrow property tax revenues (PropDsitiDn 1A, 2004) from IDcal gDvernments. LDcal gDvernments cDuld bDrrow against the state's constitutiDnal DbligatiDn to. repay, thereby mitigating the impact Df this reductiDn. HDwever, in the current eCDnDmic landscape, IDcal gDvernments are nDt easily finding available ShDrt term financing and could face difficulties bDrrowing these funds from the market. If they bDrrow, IDcal gDvernment will incur substantial bDrrowing CDStS. If IDcal gDvernments are unable to. bDrrow Dr can bDrrow insufficient amDunts, IDcal gDvernment may have to' make reductiDns to' IDcally funded services. Property tax revenues are used by IDcal gDvernments fDr a variety Df services including pDlice and fire, waste cDllectiDn, road maintenance, libraries and Dther services. Reduction Impacts Specific impacts Df this reductiDn will vary by IDcal jurisdictiDn and will in part depend Dn the ability Df IDcal gDvernment to. Dbtain bDrrowing frDm the market. This reductiDn cDuld result in cuts to. IDcaily funded services such as pDlice and fire, waste cDllectiDn, road maintenance, libraries and Dther services. 1 2009-10 May Revision Option (Dollars in Thousands) Based on a survey of the top 15 California cities in terms of property tax revenue collection estimates (based on 2006-07 collections), if adopted, this option could result in reductions to their budgets, as follows: Los Angeles San Francisco San Diego San Jose Sacramento Long Beach Oakland Fresno Newport Beach Pleasanton Bakersfield Riverside Fremont Berkeley Huntington Beach $67,712,897 $61 ,833,541 $20,054,088 $12,810,380 $7,425,680 $6,604,224 $6,363,535 $4,607,868 $4,475,138 $3,202,884 $3,071,241 $3,051,165 $3,025,522 $2,951,759 $2,886,124 Reductions, if not replaced by local borrowing, would come on top of reductions most cities and counties are considering or already budgeting to address shortfalls in local sales and property tax revenues. Finance is estimating property taxes to decline by an average of 4 percent in 2009-10 after growing only about 2 percent 2008-09 and sales taxes are declining by about15 percent from 2007-08. Increases in layoffs of police, fire, public health, recreation and other tax supported workers are likely. Due to federal and state laws, counties may have limited ability to reduce costs in some programs where financial responsibility is shared, but they can make some employee compensation reductions and implement other savings. Special districts and cities often have other fees that could be raised to backfill reductions and maintain services. However, basic public protection can generally not be fee supported. Districts that are only property tax supported would face up to 8 percent budget reductions. Timing of Implementation The reduction could be legally effective on July 1, 2009, if enacted as an urgency statute. The statute would provide for the timing and mechanism of payment to the state. Locals receive property tax in December and April or shortly thereafter. Taking funds from them before that could cause a local cash crunch and some may simply not pay timely. Statutory and/or Regulatory Change The Constitution requires the Governor to issue a proclamation of a severe state fiscal hardship and passage of a separate two-thirds vote bill. The bill should specify how interest will be paid since there is no provision in current law for this and the Constitution requires there be payment of interest provided by law. It is likely locals will ask that their full cost of borrowing be covered by state interest payments. 2