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HomeMy WebLinkAbout2020-08-17 City Council Agenda Packet City Council 1 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. Monday, August 17, 2020 Special Meeting 5:00 PM ****BY VIRTUAL TELECONFERENCE ONLY*** https://zoom.us/join Meeting ID: 362 027 238 Phone:1(669)900-6833 Pursuant to the provisions of California Governor’s Executive Order N-29-20, issued on March 17, 2020, to prevent the spread of Covid-19, this meeting will be held by virtual teleconference only, with no physical location. The meeting will be broadcast on Cable TV Channel 26, live on YouTube at https://www.youtube.com/c/cityofpaloalto, and Midpen Media Center at https://midpenmedia.org. Members of the public who wish to participate by computer or phone can find the instructions at the end of this agenda. To ensure participation in a particular item, we suggest calling in or connecting online 15 minutes before the item you wish to speak on. TIME ESTIMATES Time estimates are provided as part of the Council's effort to manage its time at Council meetings. Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Council reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting or to adapt to the participation of the public. HEARINGS REQUIRED BY LAW Applicants and/or appellants may have up to ten minutes at the outset of the public discussion to make their remarks and up to three minutes for concluding remarks after other members of the public have spoken. Call to Order Closed Session 5:00-7:00 PM Public Comments: Members of the public may speak to the Closed Session item(s); three minutes per speaker. A. PUBLIC EMPLOYEE APPOINTMENT Title: City Auditor Authority: Government Code Section 54957 (b) Agenda Changes, Additions and Deletions Oral Communications 7:00-7:30 PM Members of the public may speak to any item NOT on the agenda. Council reserves the right to limit the duration of Oral Communications period to 30 minutes. REVISED 2 August 17, 2020 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. Minutes Approval 7:30-7:35 PM 1.Approval of Action Minutes for the August 03, 2020 City Council Meeting Consent Calendar 7:35-7:40 PM Items will be voted on in one motion unless removed from the calendar by three Council Members. 2.Adoption of a Resolution Amending Utility Rate Schedule E-15 (Electric Service Connection Charges), and Utilities Rules and Regulations 2, 15, 20, 27 and 29 City Manager Comments 7:40-7:50 PM Action Items Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. 7:50-9:00 PM 2A. PUBLIC HEARING / QUASI-JUDICIAL. 2353 Webster Street [18PLN00339]: Appeal of Director’s Approval of an Individual Review Application to Demolish an Existing One-story 1,593 Square Foot (SF) Home and Construct a Two-story Home (Approximately 2,935 SF) With a Basement and an Attached Garage. Zoning District: Single-family Residential (R-1) (Continued From August 10, 2020) 9:00-10:00 PM 3.Staff and Utilities Advisory Commission Recommend the City Council Adopt a Resolution Amending the City's Electric Supply Portfolio Carbon Neutral Plan and Electric Utility Reserves Management Practices 4.PUBLIC HEARING/LEGISLATIVE: Adoption of Several Ordinances Regarding Accessory Dwelling Units and Junior Accessory Dwelling Units Amending Palo Alto Municipal Code Titles 16 (Building) and 18 (Zoning). Amendments Include Repealing Section 18.42.040 (Accessory and Junior Accessory Dwelling Units); Adding a new Chapter 18.09 (Accessory Dwelling Units and Junior Accessory Dwelling Units); Updating Chapters 18.04 (Definitions); 16.58 (Development Impact Fees); 16.04 (California Building Code); 16.06 (California Residential Code); and 16.14 (California Green Building Standards Code). Environmental Assessment: Exempt From Review Under the California Environmental Quality Act (CEQA) Pursuant to Q&A MEMO Presentation Public Comment Public Comment 3 August 17, 2020 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. Public Resources Code Section 21080.17 and CEQA Guidelines Sections 15061(b)(3), 15282(h), 15301, 15302 and 15305(THIS ITEM HAS BEEN CONTINUED TO SEPTEMBER 14, 2020) Council Member Questions, Comments and Announcements Members of the public may not speak to the item(s) Adjournment AMERICANS WITH DISABILITY ACT (ADA) 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. 4 August 17, 2020 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. Additional Information Informational Report City of Palo Alto Investment Activity Report for the Fourth Quarter, Fiscal Year 2020 ADU Quarterly Report (Quarter 1 and Quarter 2) Standing Committee Meetings Finance Committee Meeting Cancellation August 18, 2020 Sp. City/School Liaison Meeting August 20, 2020 Schedule of Meetings Schedule of Meetings Tentative Agenda Tentative Agenda Public Letters to Council Set 1 5 August 17, 2020 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. Public Comment Instructions Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone. 1. Written public comments may be submitted by email to city.council@cityofpaloalto.org. 2. Spoken public comments using a computer will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom-based meeting. Please read the following instructions carefully. A. You may download the Zoom client or connect to the meeting in- browser. If using your browser, make sure you are using a current, up-to-date browser: Chrome 30+, Firefox 27+, Microsoft Edge 12+, Safari 7+. Certain functionality may be disabled in older browsers including Internet Explorer. B. You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak. C. When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak. D. When called, please limit your remarks to the time limit allotted. E. A timer will be shown on the computer to help keep track of your comments. 3. Spoken public comments using a smart phone will be accepted through the teleconference meeting. To address the Council, download the Zoom application onto your phone from the Apple App Store or Google Play Store and enter the Meeting ID below. Please follow the instructions B-E above. 4. Spoken public comments using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted. https://zoom.us/join Meeting ID: 362 027 238 Phone:1(669)900-6833 CITY OF PALO ALTO OFFICE OF THE CITY CLERK August 17, 2020 The Honorable City Council Attention: Finance Committee Palo Alto, California Approval of Action Minutes for the August 03, 2020 City Council Meeting Staff is requesting Council review and approve the attached Action Minutes. ATTACHMENTS: • Attachment A: 08-03-20 DRAFT Action Minutes (PDF) Department Head: Beth Minor, City Clerk Page 2 CITY OF PALO ALTO CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 5 Special Meeting August 3, 2020 The City Council of the City of Palo Alto met on this date in Virtual Teleconference at 5:01 P.M. Participating Remotely: Cormack, DuBois, Filseth, Fine, Kniss, Kou, Tanaka Absent: Closed Session 1. CONFERENCE WITH CITY ATTORNEY- EXISTING LITIGATION Santa Clara County Superior Court, Case No. 16CV300760 (One Case, as Defendant) –Miriam Green v. City of Palo Alto Authority: Government Code Section 54956.9(d)(1). MOTION: Mayor Fine moved, seconded by Council Member Cormack to go into Closed Session. MOTION PASSED: 7-0 Council went into Closed Session at 5:04 P.M. Council returned from Closed Session at 5:36 P.M. Mayor Fine announced no reportable action. Study Session 2. City Council Discussion of Procedures for Virtual Council Meetings. NO ACTION TAKEN Minutes Approval 3. Approval of Action Minutes for the May 26, June 15, 16, 17, 22 and 23, 2020 City Council Meetings. MOTION: Council Member Kniss moved, seconded by Mayor Fine to approve the Action Minutes for the May 26, June 15, 16, 17, 22 and 23, 2020 City Council Meetings. DRAFT ACTION MINUTES Page 2 of 5 City Council Meeting Draft Action Minutes: 08/03/2020 MOTION PASSED: 7-0 Consent Calendar MOTION: Council Member Cormack moved, seconded by Mayor Fine, third by Council Member Kou to pull Agenda Item Number 9 to be heard on August 10, 2020 Action Calendar. Council Member Kniss registered a no vote on Agenda Item Number 7. Vice Mayor DuBois registered a no vote on Agenda Item Number 7. Mayor Fine registered a no vote on Agenda Item Number 7. Council Member Kou registered a no vote on Agenda Item Number 8. Council Member Tanaka registered a no vote on Agenda Item Number 8. MOTION: Mayor Fine moved, seconded by Council Member Cormack to approve Agenda Item Numbers 4, 6-8. 4. Approve and Authorize the City Manager or Designee to Execute Contract Number C20176772 With Burns & McDonnell in an Amount Not-to-Exceed $690,000 for the 60kV Breaker Replacement Design/Build Implementation, Capital Improvement Project EL-17002; and Authorization to Negotiate and Execute Related Change Orders in the Amount of $103,500, for a Total Not-to-Exceed Amount of $793,500. 5. Approve and Authorize the City Manager or Designee to Execute the Following Utilities Communication, Graphic Design and Marketing Services Contracts in a Combined Not-to-Exceed Amount of $200,000 Annually and a Combined Not-to-Exceed Amount of $1,000,000 Over a Five-year Term: A) Eric Goldsberry Art Direction, C20176172A; B) Marketing for Change, C20176172B; and C) Underground Advertising, C20176172C; Finding of California Environmental Quality Act (CEQA) Exemption THIS ITEM REMOVED FROM AGENDA. 6. QUASI-JUDICIAL. 3000 Alexis Drive [19PLN-00304]: Approval of the Record of Land Use Action (RLUA) Approving the Proposed Project, and Site and Design Review Application for the Palo Alto Hills Golf and Country Club to Renovate the 18-hole Golf Course. Environmental Assessment: Exempt From CEQA Pursuant to Guidelines Section 15304 (Minor Alterations to Land) Zoning District: OS (Open Space). DRAFT ACTION MINUTES Page 3 of 5 City Council Meeting Draft Action Minutes: 08/03/2020 7. Adoption of Amendments to the City of Palo Alto Tobacco Retailer Permit Ordinance 5502 Entitled, “Ordinance of the Council of the City of Palo Alto (PAMC Chapter 4.64) to Further Restrict Electronic Cigarette Products and Flavored Tobacco Products (FIRST READING: June 16, 2020 PASSED: 4-3 DuBois, Fine, Kniss no).” 8. Ordinance 5503 Entitled, “Ordinance of the Council of the City of Palo Alto to Reduce the Number of Human Relations Commission and Public Art Commission Members From Seven to Five (FIRST READING: June 22, 2020 PASSED: 5-2 Kou, Tanaka no).” 9. Selection of Applicants to Interview for one Position on the Human Relations Commission and two Positions on the Public Art Commission. MOTION FOR AGENDA ITEM NUMBER 4 PASSED: 7-0 MOTION FOR AGENDA ITEM NUMBER 6 PASSED: 7-0 MOTION FOR AGENDA ITEM NUMBER 7 PASSED: 4-3 DuBois, Fine, Kniss no MOTION FOR AGENDA ITEM NUMBER 8 PASSED: 5-2 Kou, Tanaka no Council took a break at 6:59 P.M. and returned at 7:12 P.M. Action Items 10. Discussion of the Parks and Recreation Commission's Pilot Program to Increase Access to Foothills Park for Non-residents and Provide Direction to Staff (Continued From June 23, 2020). Council took a break at 9:09 P.M. and returned at 9:16 P.M. MOTION: Council Member Cormack moved, seconded by Mayor Fine to direct Staff to return with an Ordinance to amend the Municipal Code to allow non- residents to access Foothills Park under a pilot plan and a Resolution to define the pilot plan itself. SUBSTITUTE MOTION: Council Member Kou moved, seconded by Council Member Tanaka to: A. Direct Staff to bring this item to the Council in 2022 for a possible ballot measure; B. Rename Foothills Park to Foothills Nature Preserve; and DRAFT ACTION MINUTES Page 4 of 5 City Council Meeting Draft Action Minutes: 08/03/2020 C. Change the fine from a misdemeanor to an infraction. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Substitute Motion, “move forward with the pilot program for the following year, assess measurable points such as cost, and use that data for a possible ballot measure in 2022” (New Part D) and “ensure the pilot program remains revenue neutral.” (New Part E) INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to change Substitute Motion, Part D to read, “…starting in the Fall of 2020 or Winter of 2021…” SUBSTITUTE MOTION AS AMENDED: Council Member Kou moved, seconded by Council Member Tanaka to: A. Direct Staff to bring this item to the Council in 2022 for a possible ballot measure; B. Rename Foothills Park to Foothills Nature Preserve; C. Change the fine from a misdemeanor to an infraction; D. Move forward with the pilot program starting in the Fall of 2020 or Winter of 2021, assess measurable points such as cost, and use that data for a possible ballot measure in 2022; and E. Ensure the pilot program remains revenue neutral. SUBSTITUTE MOTION AS AMENDED PASSED: 5-2 Cormack, Fine no 11. Update and Discussion on Plan Bay Area 2050 Draft Blueprint and the Regional Housing Needs Allocation Process; and Direction to Staff to Prepare Comment Letters on These Regional Efforts. MOTION: Mayor Fine moved, seconded by Vice Mayor DuBois to: A. Authorize the Mayor to sign a letter reflecting City Council comments on the Plan Bay Area 2050 Draft Blueprint; and B. Schedule a discussion to submit a comment letter to ABAG/MTC’s Housing Methodology Committee reflecting City Council initial comments regarding the Regional Housing Needs Allocation (RHNA) methodology options that are under consideration. MOTION PASSED: 7-0 DRAFT ACTION MINUTES Page 5 of 5 City Council Meeting Draft Action Minutes: 08/03/2020 12. Discussion and Direction Regarding Potential Placement of a CalTrain 1/8-cent Sales Tax Measure on the November 3, 2020 Ballot. MOTION: Council Member Kniss moved, seconded by Mayor Fine to send a letter requesting that the Santa Clara County Board of Supervisors support placing a Caltrain 1/8-cent sales tax measure on the November 2020 ballot, and to support future efforts to work with other jurisdictions on the governance issue. MOTION PASSED: 7-0 Adjournment: The meeting was adjourned at 12:41 A.M. in memory of former Council Member Grant Spaeth and in honor of civil-rights champion and U.S. Representative John Lewis. City of Palo Alto (ID # 11416) City Council Staff Report Report Type: Consent Calendar Meeting Date: 8/17/2020 City of Palo Alto Page 1 Summary Title: Rules and Regulations Changes Title: Adoption of a Resolution Amending Utility Rate Schedule E-15 (Electric Service Connection Charges), and Utilities Rules and Regulations 2, 15, 20, 27 and 29 / Resolution Amending City of Palo Alto Rate Schedule and Utilities Rules and Regulations From: City Manager Lead Department: Utilities Recommended Motion Staff Recommends the City Council Adopt the Resolution Amending Utility Rate Schedule E-15, and Utilities Rules and Regulations 2, 15, 20, 27 and 29. Recommendation Staff recommends that Council adopt the attached Resolution (Attachment A) amending Utility Rate Schedule E-15, and Utilities Rules and Regulations 2, 15, 20, 27 and 29, as linked in Attachment H. Executive Summary In 2019 staff performed a comprehensive review and update of the Utilities Rate Schedules and Rules and Regulations. Council approved Resolutions to amend the Rates in June 2019 (Resolution 9852) and the Rules and Regulations in October 2019 (Resolution 9861). During implementation of the new Rates and Rules and Regulations it was found that some proposed changes were inadvertently left out of the revised documents. Staff recommends adoption of amendments to Utility Rate Schedule E-15, and Utilities Rules and Regulations 2 (Definitions and Abbreviations), 15 (Metering), 20 (Special Electric Utility Regulations), 27 (Generating Facility Interconnections) and 29 (Net Energy Metering Service, Billing and Interconnection) to correct the oversight. Background The 2019 review and update of the Utilities Rate Schedules and Rules and Regulations by Utilities and Legal Staff was a comprehensive review of all the documents. Council approved Resolutions to amend the Rates in June 2019 (Council Report ID 10295) and the Rules and Regulations in October 2019 (Council Report ID 10713). During implementation of the new City of Palo Alto Page 2 Rates and Rules and Regulations staff found that some proposed changes were inadvertently left out of the revised documents. During the review, language within Rate Schedule E-15 recommended to be relocated to the appropriate Rule and Regulation was deleted from the Rate Schedule that was approved in June 2019 but was not replaced within Rules and Regulations 15 and 20 when these were updated and approved in October 2019. In addition, staff found that some definitions and requirements relating to Net Energy Metering (NEM) needed to be updated. The Rules and Regulations addressing NEM included references to Public Utilities Code (PUC) 2827, which pertains specifically to the City’s original NEM program (NEM 1) but not to the City’s NEM Successor (NEM 2) program, and so portions of Rules and Regulations 2, 27 and 29 are amended here to remove those NEM 1 references. The recommended changes in this Resolution include: changing some definitions in Rule and Regulation 2 so the definitions accommodate Palo Alto’s NEM Successor (NEM 2) program; adding the language that was inadvertently left out of Utilities Rules and Regulations 15 and 20 for improved organization of topics and understanding; and removing references to PUC 2827 and its associated requirements where appropriate in Rules and Regulations 27 and 29. City of Palo Alto Page 3 Discussion Utility Rate Schedule E-15 (Electric Service Connection Charges) – Attachment B The current Council approved schedule is up to date and only requires minor edits that were overlooked in the final revision. These edits are necessary for clarity. Utilities Rule and Regulation 2 (Definitions and Abbreviations) – Attachment C The recommended amendments to Rule and Regulation 2 include changes to the definition of Customer-Generator to remove references to Public Utilities Code Section 2827. Specifically, the definition was modified to remove limitations on Generating Facility system size that do not apply under the City’s Net Energy Metering Successor (NEM 2) program. The City’s original Net Energy Metering (NEM 1) program meets the requirements of California’s NEM legislation (SB 656, 1995), which was developed to encourage private investment in renewable energy resources. While NEM legislation served to incentivize investments in renewables, it was not intended to incentivize development of projects that meet more than a customer’s annual electricity needs. Under NEM 2, customers may choose to install Generating Facility systems sized to meet more than their annual electrical needs if, for example, they anticipate an increase in their electrical requirements because of future building or transportation electrification projects. Additional amendments specify that Generating Facilities may be used to store as well as produce energy, thus clarifying that the definition includes energy storage facilities. Utilities Rule and Regulation 15 (Metering) – Attachment D The recommended amendments to Rule and Regulation 15 include the relocation of the language regarding Utilities Automatic Meter Reading equipment in residential, multi-family or commercial/industrial developments and applicable charges to customers. During the last revision, the language was deleted from Rate Schedule E-15 with the intent to move it to the Utilities Rules and Regulations. Making this change now corrects that oversight. Utilities Rule and Regulation 20 (Special Electric Utility Regulations) – Attachment E The recommended amendments to Rule and Regulation 20 include the insertion of language regarding limits for the installation of new utility wood poles and clarification regarding the type of electric service provided in overhead and underground areas. During the last revision, the language was deleted from Rate Schedule E-15 with the intent to move it to the Utilities Rules and Regulations. Making this change now corrects that oversight. Utilities Rule and Regulation 27 (Generating Facility Interconnections) – Attachment F The recommended amendments to Rule and Regulation 27 include removal of language pertaining to interconnection of Generating Facilities that qualify for service under the City’s NEM 1 program. This language is no longer needed since the City reached its NEM 1 Cap and new renewable Generating Facilities are interconnected under NEM 2. Utilities Rule and Regulation 29 (Net Energy Metering Service, Billing and Interconnection) – City of Palo Alto Page 4 Attachment G The recommended amendments to Rule and Regulation 29 include removal of NEM program eligibility requirements that originated from PUC 2827 and pertain specifically to systems installed and interconnected under the City’s NEM 1 program. As mentioned above in the section discussing Rule 2 changes, some system size restrictions that applied under the City’s NEM 1 program do not apply to systems interconnected under NEM 2. Resource Impact Approval of changes to Utility Rate Schedule E-15, and Utilities Rules and Regulations 2, 15, 20, 27 and 29 do not result in any change in net operating revenues or expenses. Policy Implications These recommendations do not represent a change in current City policies. Stakeholder Engagement These recommendations do not impact stakeholder engagement. Environmental Review The approval of the recommended changes does not meet the definition of a “project” under Public Resources Code 21065 or CEQA Guidelines Section 15378(b)(2), thus no CEQA review of this action is required. Attachments: • Attachment A: Resolution • Attachment H: Linked Attachments B thru G Attachment A *Not Yet Adopted* 027060420 Resolution No. _______ Resolution of the Council of the City of Palo Alto Amending Utility Rate Schedule E-15 (Electric Service Connection Charges), and Approving Amendments to Utilities Rule and Regulation 2 (Definitions and Abbreviations), Utilities Rule and Regulation 15 (Metering), Utilities Rule and Regulation 20 (Special Electric Utility Regulations), Utilities Rule and Regulation 27 (Generating Facility Interconnections), Utilities Rule and Regulation 29 (Net Energy Metering Service, Billing and Interconnection) The Council of the City of Palo Alto does hereby RESOLVE as follows: Section 1. Pursuant to section 12.20.010 of the Palo Alto Municipal Code, Schedule E-15 (Electric Service Connection Charges) of the Palo Alto Utilities Rates and Charges is hereby amended to read as attached and incorporated. The foregoing Utility Rate Schedule, as amended, shall become effective August 17, 2020. Section 2. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rule and Regulation 2 (Definitions and Abbreviations) is hereby amended as attached and incorporated. Utility Rule and Regulation 2, as amended, shall become effective August 17, 2020. Section 3. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 15 (Metering) is hereby amended as attached and incorporated. Utility Rule and Regulation 15 as amended, shall become effective August 17, 2020. Section 4. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 20 (Special Electric Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 20, as amended, shall become effective August 17, 2020. Section 5. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 27 (Generating Facility Interconnections) is hereby amended as attached and incorporated. Utility Rule and Regulation 27, as amended, shall become effective August 17, 2020. Section 6. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 29 (Net Energy Metering Service, Billing and Interconnection) is hereby amended as attached and incorporated. Utility Rule and Regulation 29, as amended, shall become effective August 17, 2020. Attachment A *Not Yet Adopted* 027060420 Section 7. Council finds that the adoption of this resolution amending Utility Rules and Regulations does not meet the definition of a “project” under Public Resources Code 21065 or CEQA Guidelines Section 15378(b), thus no CEQA review of this action is required. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: APPROVED: ____________________________ _________________________________ City Clerk Mayor APPROVED AS TO FORM: _________________________________ City Manager ____________________________ Deputy City Attorney _________________________________ Director of Utilities ATTACHMENT H ID# 11416 Adoption of a Resolution Amending Utility Rate Schedule E-15 (Electric Service Connection Charges), and Utilities Rules and Regulations 2, 15, 20, 27 and 29 / Resolution Amending City of Palo Alto Rate Schedule and Utilities Rules and Regulations Attachment B - UTILITY RATE SCHEDULE E-15 - ELECTRIC SERVICE CONNECTION CHARGES Attachment C - RULE AND REGULATION 2 - DEFINITIONS AND ABBREVIATIONS Attachment D - RULE AND REGULATION 15 - METERING Attachment E - RULE AND REGULATION 20 - SPECIAL ELECTRIC UTILITY REGULATIONS Attachment F - RULE AND REGULATION 27 - GENERATING FACILITY INTERCONNECTIONS Attachment G - RULE AND REGULATION 29 - NET ENERGY METERING SERVICE, BILLING AND INTERCONNECTION TO: FROM: DATE: CITY OF PALO ALTO HONORABLE CITY COUNCIL DEAN BATCHELOR, DIRECTOR OF UTILITIES AUGUST 17, 2020 2 SUBJECT: AGENDA ITEM NUMBER 2-Adoption of a Resolution Amending Utility Rate Schedule E-15 (Electric Service Connection Charges), and Utilities Rules and Regulations 2, 15, 20, 27 and 29 / Resolution Amending City of Palo Alto Rate Schedule and Utilities Rules and Regulations The Utilities Staff recognizes the importance of Rates, Rules and Regulation changes. The department has set a biannual review to ensure the completeness of the changes in order to bring forth a finalized annual report to the City Council. Dean Batchelor Director of Utilities Department Monique LeConge Ziesenhenne Assistant City Manager 1 of 1 DocuSign Envelope ID: 9610D65F-9283-4762-91F4-60D602915D91 City of Palo Alto (ID # 11411) City Council Staff Report Report Type: Action Items Meeting Date: 8/10/2020 City of Palo Alto Page 1 Summary Title: 2353 Webster Street: Appeal of Director's Decision on Individual Review Application Title: PUBLIC HEARING / QUASI-JUDICIAL. 2353 Webster Street [18PLN- 00339]: Appeal of Director’s Approval of an Individual Review Application to Demolish an Existing One-story 1,593 sf Home and Construct a Two-story Home (Approx. 2,935 sf) With a Basement and an Attached Garage. Zoning District: Single-family Residential (R-1) From: City Manager Lead Department: Planning and Development Services Recommendation Staff recommends City Council uphold the Planning and Development Services Director’s approval of the Individual Review (IR) application (File No. 18PLN-00339). The project is a new two-story home within the Old Palo Alto neighborhood. Executive Summary This request is an appeal of the Planning and Development Services Director’s (Director) approval of a Single-Family Individual Review (IR) application for a new two-story home. Three Council members voted to remove this item from the Consent Calendar on May 18, 2020 to hold a formal public hearing. Appellants Jack Morton and Mary Ellen White are the owners of 2343 Webster Street, a single- story home abutting the subject property. As required by the Palo Alto Municipal Code, staff mailed all decision and hearing notices regarding the project to the immediate neighbors, including the appellant. The appellant is concerned about the Valley oak tree in the proposed home’s rear yard, and how it will be affected by construction including potential dewatering to construct the basement. City of Palo Alto Page 2 Staff is equally committed to protecting the tree to the highest degree feasible. Tree protection is achievable through the implementation of standard project conditions of approval, adopted City regulations, and project-specific conditions of approval. Background Individual Review applications are reviewed and approved through the Low-Density Residential Review Process set forth in Palo Alto Municipal Code (PAMC) 18.77.075. The first decision is a staff-level, tentative ‘Director’s decision’; this tentative decision is subject to a hearing request process. Any adjacent property owner or occupant may request a Director’s Hearing within 14 days of the tentative decision. If requested, the Director then sets and conducts a noticed public hearing on the project, receives testimony, and makes a decision that becomes final 14 days thereafter. A Director’s Hearing was requested for this project and was held on February 27, 2020, after which the Director reapproved the project with additional tree protection measures. Following this approval, and within the 14-day appeal period, owners or occupants of abutting properties may appeal the decision to Council. Appeals are placed on the Council consent calendar for final action. An appeal was received on March 31, 2020. The project was then placed on the Council’s May 18, 2020 consent agenda. Council removed the item from the consent calendar and which time staff scheduled this August 3, 2020 public hearing. As part of this hearing, the Council shall adopt findings and act on the application. The decision of the Council is final. Further background information is available in the Council staff report from the May 18th Council Meeting, https://bit.ly/2353WebsterCCReport. May 18, 2020 Public Comment Two residents shared public comments during the consent calendar hearing for this project on May 18, 2020: (1) Mr. Keith Bennett provided both written and oral comments. He is concerned the current project Conditions of Approval do not adaquately protect the specimen oak tree with regards to basement construction, particularly dewatering. (2) The appellant Mr. Jack Morton expressed concern that potential damage to the tree would dramatically impact his quality of life. Discussion The project meets all five of the City’s Individual Review (IR) guidelines. The project complies with the Public Works regulations for dewatering. The project also complies with Urban Forestry regulations for protecting the mature Valley Oak tree. Findings for the project’s compliance with IR guidelines are available in the administrative record and were provided as Attachment F in the May 18, 2020 staff report. The findings include analysis provided by the City’s consulting architect, dated October 3, 2019. The document also includes recommended City of Palo Alto Page 3 conditions of approval, which were incorporated as Conditions of Approval #5e and #13a. The project is required to meet all standards for dewatering, in accordance with the Conditions of Approval. Following the Director’s Hearing, the Director added conditions to further clarify how to protect the Valley Oak tree. These conditions are provided as Condition of Approval #1, Special Conditions (Attachment B). In total, the project has met the findings for approval, and the project approval is enhanced with the Director’s special conditions to ensure protection of the Valley Oak tree. Therefore, staff recommends upholding the Director’s decision to approve the project. Overall Tree Health The tree in question is a Valley Oak (Quercus lobata) tree with a mature canopy radius of 38 feet. The project arborist, Davey Resource Group, deems the tree to be in fair condition. The tree is approximately 4.5 feet from the existing house, which is to be demolished. The proposed house will be at least 34-feet, 4-inches away from the base of the trunk. The Tree Protection Zone (TPZ) for this tree is a 60-foot radius measured from the trunk, which amounts to approximately 50% of the buildable area. Excavation for the new home is proposed within the outer portion of the TPZ, 30-40 feet from the trunk and beyond. Proposed demolition and construction would potentially impact 17% of the TPZ. Impacts to more than 25% of the root system may be defined as “removal” of the tree, though each situation has both site and tree specific factors to consider. It is important to note that with the existing house foundation currently sitting within the dripline of the tree, therefore, fewer tree roots are likely to be found in this area. A number of tree protection measures were adopted in the Director’s approval letter following the Director’s Hearing. In particular: • The project shall follow all standard tree protection conditions and Urban Forestry regulations including PAMC 8.10; • Staff will hold a pre-construction meeting to discuss the construction phase conditions with those who will be onsite during construction (Condition #2); • The 14 feet of the existing foundation nearest the tree shall not be removed, to prevent disturbance of any underlying roots; • Demolition of the remaining foundation shall be accomplished by air spade and/or hand tools only, and be performed under the supervision of a Certified Arborist; • Recommendations from the final Arborist Report (submitted at Building Permit application) shall be included as additional conditions of approval; • Tree protection fencing shall be installed prior to demolition, where feasible, and placed City of Palo Alto Page 4 no closer than 40 feet from the trunk of the Valley Oak; • The applicant’s consulting arborist is to make daily visits during demolition to the site and prepare a daily memo attesting to the contractor’s compliance with the arborist’s report and related Urban Forestry conditions of approval (Conditions #27-40); • During demolition and construction, all pervious area within the TPZ shall be covered with 12 inches of woodchips and a layer of plywood, to the satisfaction of the Urban Forester (Conditions #28b and 28c); • The location for the dewatering monitoring well required in Condition #43 shall be determined by the Director of Public Works prior to building permit approval, to ensure the goals of the monitoring well are balanced with the need to protect the Valley Oak. It is important to state that if the applicant were to propose to remove the Valley Oak tree, the application would be processed administratively, by the Urban Forestry Team, in accordance with Municipal Code. PAMC 8.10.050(d)(2) states: Removal is permitted as part of project approval under Chapter 18.76 (Permits and Approvals) of this Code, because retention of the tree would result in reduction of the otherwise-permissible buildable area by more than 25%. In such a case, the approval shall be conditioned upon tree replacement in accordance with the standards in the Tree Technical Manual. The buildable area is defined as the portion of the lot which is not within the required setbacks. Since the TPZ of the Valley Oak is a 60-foot radius, it takes up more than half of the lot, and approximately 50% of the buildable area. To build the house fully outside the TPZ would reduce the building area by more than twenty-five percent. However, the City also has policies to ensure “no net loss of canopy” which would require any such removal to include a combination of replacement trees and potentially in-lieu payment to achieve this goal. Dewatering One of the neighbor’s main concerns is that the dewatering aspect of the project has not been sufficiently analyzed. In a typical IR project, dewatering review is conducted at the time of Building Permit application, not Planning Entitlement. A hydrogeological study is provided as a part of the building permit application materials. This provides detailed information of the expected need for dewatering, including the volume of water potentially to be pumped, and potential impact to surrounding trees and buildings. It is possible the basement project will require no dewatering, but this will not be determined until the applicant provides the full hydrogeological study. Furthermore, staff is confident the existing regulations for dewatering sufficiently protect the oak tree. There are a few ways the basement could be constructed, which have different potential impacts. Regardless of the basement construction method, the current Conditions of Approval already require a certified arborist to supervise all excavation. City of Palo Alto Page 5 • The basement could be shored with secant walls. In this method, I-beams are driven into the ground and concrete is poured to shore and isolate the excavation area. Dewatering is limited to the basement footprint within the secant walls, however construction of the secant walls may unexpectedly cut tree roots. • The basement could be shored with I-beams and wood lagging. I-beams are driven into the ground and wood is installed between the beams every few feet as excavation commences. Because the lagging is not watertight like a secant wall, it is not recommended in high water table areas, as dewatering may extend a few feet beyond the basement footprint. In this method, I-beams may still cut minor tree roots, but less than secant walls. • The basement does not use shoring. The basement is allowed to be excavated using a 1:1 cutback to prevent caving, with vertical excavation allowed for the lowest five feet. No beams are driven, so it is more likely tree roots will be visible during construction and the on-site Arborist can be more aware of any damage to the roots. However, this requires an area approximately five feet wider than the proposed basement footprint to be excavated. The area to be dewatered would be comparable to other methods, because dewatering is only expected to occur within the last few feet of excavation, and not within the cutback. Based on the three options, staff recommends the applicant use I-beam and wood lagging shoring. This method would use fewer drill holes compared to a secant wall, while also limiting excavation outside of the basement footprint. During excavation, there is also the ability to be more conscious of tree roots within the TPZ. As noted below, the City Council may decide to impose this additional condition on the project, if approved. In all cases, the Public Works Department provides strict monitoring requirements for dewatering, per PAMC 16.28.155. These requirements have been significantly strengthened over recent years (2016-2018) in response to residents’ concerns. Open pit dewatering is not allowed, and groundwater pumped is required to be reused for on-site and/or local irrigation to the extent possible. A groundwater monitoring well is required on site, and groundwater level reports are required daily for the first two weeks, and weekly thereafter. All dewatering is limited to a maximum 12-week period within Palo Alto’s dry season, April to October. If the initial daily report results are greater than anticipated, a revised Dewatering Hydrogeological Study is required. Additional requirements for the hydrogeological study, pre-construction analysis, and regulations and monitoring during construction are available in Attachment D. The dewatering requirements are applied to all basement projects in the City, which require dewatering. It is typically not a discretionary process. For example, a new one-story house with basement requires only a building permit, and the proposal to build a basement could not be appealed to Council by neighbors. City of Palo Alto Page 6 Lastly, it is important to consider the particular tree species. A Valley oak is a drought-tolerant tree. Its roots are generally within 4 feet of the surface, significantly higher than the average groundwater depth of 9-12 feet. The tree likely depends on seasonal rain and surface irrigation for water rather than groundwater. Too much water may in fact damage an oak. Therefore, dewatering is unlikely to impact the water sources of the tree. Alternative to Staff Recommendation The Council is to adopt findings and act on the project, per PAMC 18.75.075(g)(2). Alternatives to the staff recommendation include: • Require additional conditions of approval or modifications to the proposed project design or scope; • Deny the project; or • Continue the item to a future hearing. While staff believes there are sufficient tree protection conditions placed on this project to help protect the mature Valley Oak tree, Council may still wish to apply additional conditions, which could include the following: • Additional oversight by City Staff. Additional inspections by the City’s Urban Forestry Team could be required during demolition, excavation, and/or construction. (Please note the applicant’s project Arborist will be highly involved and is currently required to be onsite and provide daily monitoring reports during the demolition phase.) This condition will add further expense to the applicant to recover staff time spent on this additional oversight work. • Require vertical I-beam and wood lagging for shoring. This method of shoring used during basement excavation would be preferred over alternative shoring methods, to limit potential impacts to the tree roots and from dewatering. Policy Implications The Director’s decision to approve the application is consistent with staff’s implementation of the Individual Review Guidelines, the Tree Technical Manual, and the City’s dewatering regulations, and with the policies and intent of the Individual Review Process. This is the third appeal of an Individual Review project since 2015. It is, however, the first appeal during the five-year time period of a home that is not within an Eichler neighborhood. Also, notably absent from the appeal are privacy concerns, which are typically an appeal topic associated with IR applications. City of Palo Alto Page 7 Environmental Review This project is exempt from the provision of the California Environmental Quality Act (CEQA) per Section 15303(a) (New Construction of Small Structures) of the CEQA Guidelines. Attachments: Attachment A: Location Map (PDF) Attachment B: Director's Decision Letter signed March 16, 2020 (PDF) Attachment C: Appeal Letter received March 31, 2020 (PDF) Attachment D: 2020 Regulations for Dewatering during Construction of Below Ground Structures (PDF) Attachment E: September 2019 Arborist Report and Tree Sheets (PDF) Attachment F: Project Plans (DOCX) 50. 0' 00' 50. 0' 112.0' 70.0' 112.0' 11.7' 22.0' 12 0 . 0' 112.0' 20 .0' 14.0' 14 0 . 0' 126.0'124.1' 72. 0' 110.3' 72 .0' 110.3' 72. 0' 110.4' 72.0' 110.4' 72. 0' 110.4' 72.0' 110.4' 72. 0' 50 . 0' 00.0' 50. 0' 100.0' 100.0' 50 . 0' 100.0' 50 .0' 100.0' 50. 0' 100.0' 100.0' 60. 0' 109.9' 60 .0' 109.9' 59. 4' 109.9' 59 .4' 109.9' 59 . 4' 109.9' 4' 109.9' 60. 0' 109.9' 10 5 . 0' 1.5'21.4 ' 42.1' 11 9 . 4' 57.0' 55.0' 12 0 . 0' 55.0' 12 0 . 0' 112.0' 14. 5'14.0' 11 1 . 0' 126.0' 96. 5' 99.4' 109.9' 99 .4' 112.7' 37. 0' 124.1' 72.6' 110.4' 35. 0' 14.1' 108.6' 80 . 8' 112.0' 80.8' 112.0' 80. 8' 112.0' 80 .8' 112.0' 142.0' 50 .0' 142.0'142.0' 50.0' 6.7' 127.1' 76.7' 127.1'6.7' 63. 9' 112.0' 63 .9' 112.0' 70.2' 115.5' 120.0' 112.0' 59.0' 112.0' 59 . 0' 60 .0' 112.0' 50. 50.0' 142.0' 2330 2397 2371 2361 2351 2344 2360 2370 2370A 2334 6 2343 2353 2333 2350 61 5 2360 2323 60 9 2301 2320 2320 A 2290 2342 2333 2323 2300 2309 2352 2345 2361 6 STREET BYR O N STREET O REGO N This map is a product of the City of Palo Alto GIS This document is a graphic representation only of best available sources. Legend Project Site Current Features 0' 47' Attachment A:Location Map2353 Webster Street CITY O F PALO A L TO IN C O R P O R ATE D C ALIFOR N IA P a l o A l t oT h e C i t y o f A P RIL 16 1894 The City of Palo Alto assumes no responsibility for any errors. ©1989 to 2016 City of Palo Alto efoley2, 2020-06-23 16:12:20Attachment A. Location Map (\\cc-maps\Encompass\Admin\Personal\Planning.mdb) March 16, 2020 Yali Zhou 2353 Webster St. Palo Alto, CA 94301 Gordana Pavlović 602 Hawthorne Avenue Palo Alto, CA 94301 Email: design@gordana.net SUBJECT: 2353 Webster Street - Individual Review Application 18PLN-00339 On December 5, 2019, the Director of Planning and Community Environment conditionally approved Single Family Individual Review application 18PLN-00339 for a new two-story residence with a basement at 2353 Webster St. This approval was granted pursuant to the Palo Alto Municipal Code (PAMC) Sections 18.12.110 and 18.77.075. The conditionally approved project plan set received November 20, 2019, meets the Palo Alto Single Family Individual Review Guidelines, and complies with the R-1 zone district regulations and other applicable City regulations for development as conditioned. Prior to the approval becoming effective, a timely request for Director’s Hearing was received and a Director’s Hearing was held on February 27, 2020. On March 16, 2020, the Director of Planning and Community Environment upheld the conditionally approved project. PROJECT DESCRIPTION The proposal is a request by Gordana Pavlović for Single Family Individual Review to allow demolition of an existing single story residence and construction of a new two-story single-family residence with a basement and an attached one-car garage in the R-1 zoning district, as shown on the plans received on November 20, 2019. DIRECTOR’S HEARING The hearing was requested by Jack Morton and Mary Ellen White. Their concerns included the size of the home, protection for the 300-year old Oak tree, and dewatering during basement construction. DECISION AND FINDINGS The Director of Planning and Community Environment finds that the project (as submitted on November 20, 2019 and as conditioned here) is in compliance with both the Municipal Code and the Individual Review Design Guidelines. The Director finds: DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 2  The project has been reviewed and found to be in compliance with the Palo Alto Municipal Code and IR Guidelines 1-5.  This property contains a 300-year-old specimen valley oak that requires specific and carefully prescribed tree protection measures during construction.  Potential impacts of dewatering are sufficiently reduced and monitored through Public Works standard conditions of approval and policies for dewatering. This approval will become effective 14 calendar days from the postmark date of this letter, unless an appeal is filed, as provided by Chapter 18.77.075 of the PAMC. An appeal may be filed by written request with the City Clerk before the date the Director’s decision becomes final. The written request shall be accompanied by a fee, as set forth in the municipal fee schedule. Only an applicant, or the owner or tenant of an adjacent property may appeal. If you need assistance reviewing the plans, you may visit the City’s Development Center at 285 Hamilton Avenue. A copy of this letter shall accompany all future requests for City permits relating to this approval. This approval expires in 24 months from the effective date. Should you have any questions regarding this approval, please feel free to contact Emily Foley, AICP at emily.foley@cityofpaloalto.org. Sincerely, Jonathan Lait, AICP Director of Planning and Development Services Attachment A – Findings for Approval cc: Jack Morton, 2343 Webster St, Palo Alto, CA 94301, jack@mortoncpa.com Mary Ellen 2343 Webster St, Palo Alto, CA 94301, mycek@earthlink.net Sandra Browman, 2397 Webster St, Palo Alto, CA 94301 sandra.browman@yahoo.com Keith Bennett, kbennett@luxsci.net Neighbor notification list DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 3 Attachment A INDIVIDUAL REVIEW CONDITIONS OF APPROVAL 2353 Webster Street 18PLN-00339 March 16, 2020 The approval is subject to compliance with the following conditions. The property owner is solely responsible for the conditions of approval being met. Planning staff recommends the property owner discuss the conditions of approval with the contractor, designer, etc. and contact Planning staff with any questions. PLANNING DIVISION 1. SPECIAL CONDITIONS. Based on the significance of the 300 year old specimen Valley Oak tree (Quercus lobata), the following special conditions apply: a. The 14 feet of the existing foundation nearest the tree shall be abandoned (left in place - remain as existing). b. Demolition of the remaining existing foundation shall use air spade and/or hand tools only and be performed under the supervision of a Certified Arborist. c. The final Arborist Report shall be reviewed and approved by the City’s Urban Forester and printed on the building permit plans; all recommendations from the Arborist Report shall be followed. d. The tree protection fencing shall be installed prior to demolition, where feasible. Following demolition, the remainder of the tree protection fencing shall be installed per approved plans and no closer than 40 feet from the specimen Valley Oak. e. During demolition, the applicant’s consulting arborist shall make daily visits to the site and prepare a daily memo attesting to the contractor’s compliance with the arborists report and related Urban Forestry conditions of approval (Condition Numbers 27-40) f. During demolition and construction, all pervious area within the TPZ shall be covered with 12 inches of woodchips and a layer of plywood, to the satisfaction of Urban Forestry (Condition Numbers 28b and 28c) g. The location for the dewatering monitoring well required in Condition Number 43 shall be determined by the Director of Public Works prior to building permit approval to ensure the goals of the monitoring well are balanced with the need to protect the specimen Valley Oak. 2. PRECONSTRUCTION MEETING. A preconstruction meeting shall occur at the time of building permit issuance. The contractor, homeowner, contracted project arborist, as well as the project planner, urban forester, building official and supervising building inspector shall be present at this meeting to discuss construction-phase conditions of approval, particularly arborist supervision of demolition of the existing structure. DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 4 3. CONFORMANCE WITH PLANS. Construction and development shall conform to the approved plans entitled, “Yali Residence, 2353 Webster Street, Palo Alto, California,” stamped as received by the City on November 20, 2019 on file with the Planning Department, 250 Hamilton Avenue, Palo Alto, California except as modified by these conditions of approval. 4. BUILDING PERMIT. Apply for a building permit and meet any and all conditions of the Planning, Fire, Public Works, and Building Departments. 5. BUILDING PERMIT PLAN SET. A copy of this cover letter and conditions of approval shall be printed on the second page of the plans submitted for building permit. Project plans submitted for Building permits shall incorporate the following changes: a. Gravel is not allowed within the first 10 feet of the property. b. The roof overhang at the front entry counts towards the Lot Coverage. Please show this on the FAR diagram and cover sheet data table. c. The T sheets shall be updated with the arborist report dated September 2019 which was submitted separately from the Plan Set and received November 20, 2019 d. Tree protection fencing shall be shown on Site Plan, matching the Arborist Report e. A row of tall shrubs and/or at least two trees along the left side lot line starting from near the rear corner of the house and extending to the rear lot setback line. The trees and/or tall shrubs should be evergreen and form a relatively continuous screen with plants that can grow to at 20 feet tall under normal conditions. This shall be shown on the Site Plan. f. Provide the correct GB-1 sheet, signed by the applicant or owner 6. PROJECT MODIFICATIONS: All modifications to the approved project shall be submitted for review and approval prior to construction. If during the Building Permit review and construction phase, the project is modified by the applicant, it is the responsibility of the applicant to contact the Planning Division/project planner directly to obtain approval of the project modification. It is the applicant’s responsibility to highlight any proposed changes to the project and to bring it to the project planner’s attention. 7. OBSCURED/TRANSLUCENT GLAZING. All obscure glazing, as shown on the plan set, shall be permanent in nature and shall remain for the life of the structure. Obscure glazing is either decorative glazing that does not allow views through placed into the window frame or acid etched or similar permanent alteration of the glass. Films or like additions to clear glass are not permitted where obscure glazing is shown. Obscure glazing shall not be altered in the future and shall be replaced with like materials if damaged. If operable, these windows shall open towards the public right-of-way. 8. REQUIRED PARKING: All single family homes shall be provided with a minimum of one covered parking space (10 foot by 20 foot interior dimensions) and one uncovered parking space (8.5 feet by 17.5 feet). DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 5 9. UTILITY LOCATIONS: In no case shall utilities be placed in a location that requires equipment and/or bollards to encroach into a required parking space. In no case shall a pipeline be placed within 10 feet of a proposed tree and/or tree designated to remain. 10. NOISE PRODUCING EQUIPMENT: All noise producing equipment shall be located outside of required setbacks, except they may project 6 feet into the required street side setbacks. In accordance with Section 9.10.030, No person shall produce, suffer or allow to be produced by any machine, animal or device, or any combination of same, on residential property, a noise level more than six dB above the local ambient at any point outside of the property plane. 11. DAYLIGHT PLANE: The daylight plane must clear the point where the wall plane intersects the top of the roof material. 12. IMPERVIOUS SURFACE: A minimum of 60 % of the required front yard shall have a permeable surface that permits water absorption directly into the soil (Section 18.12.040 (h)). The building permit plan set shall include a diagram demonstrating compliance. 13. REQUIRED IR LANDSCAPING/TREES. The following landscaping is required to ensure the project’s conformance with the City’s IR Guidelines and therefore must remain for the life of the structure. Required new screening trees and shrubs shall be a minimum size of 24 inch box and measure at least eight (8) feet tall. a. A row of shrubs or a minimum of two large trees as described in Condition #3e. b. Existing oak tree in rear yard 14. PROJECT ARBORIST. The property owner shall hire a certified arborist to ensure the project conforms to all Planning and Urban Forestry conditions related to landscaping/trees. 15. TREE PROTECTION FENCING. Tree protection fencing shall be required for the front street tree and the rear yard oak tree. 16. FENCES. Fences and walls shall comply with the applicable provisions of Chapter 16.24, Fences, of the Palo Alto Municipal Code (PAMC). Heights of all new and existing fencing must be shown on the Building Permit plans. a. Where the existing fence is located off the subject property and/or where the existing fence is failing, a new Code compliant fence shall be constructed. 17. LIGHT WELLS. Railings around light wells shall be screened from street view. Screening may consist of plant material or fencing. DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 6 18. BASEMENT WALLS: Basement retaining walls shall not extend beyond the exterior wall plane of the first floor of the house, excluding lightwells, below grade patios and approved extensions, to the satisfaction of the Director of Planning. 19. BASEMENT CONSTRUCTION WALLS: Any walls, temporary or otherwise, installed to facilitate construction of a basement shall be removed or constructed in such a way as to not significantly restrict the growth of required landscaping, to the satisfaction of the Director of Planning. 20. DECONSTRUCTION SURVEY: A Deconstruction Survey is required for demolition permit applications submitted on or after January 1, 2017. This survey submittal shall include a list of materials that are salvageable from the project as well as the values of such materials. At this time, the City’s only approved vendor for this service is The ReUse People. Contact them to schedule this FREE service by phone (888)588-9490 or e-mail info@thereusepeople.org. More information can be found at www.TheReusePeople.org. If you have further questions, please contact Scott McKay at scott.mckay@cityofpaloalto.org. 21. PLANNING FINAL INSPECTION. A Planning Division Final inspection will be required to determine substantial compliance with the approved plans prior to the scheduling of a Building Division final. Any revisions during the building process must be approved by Planning, including but not limited to; materials, fenestration and hard surface locations. Contact your Project Planner at the number below to schedule this inspection. 22. PERMIT EXPIRATION. The project approval shall be valid for a period of two years from the original date of approval. Application for a one year extension of this entitlement may be made prior to expiration, by emailing the Current Planning Support Staff (Alicia Spotwood - Alicia.Spotwood@CityofPaloAlto.org). If a timely extension is not received, or the project has already received an extension and the applicant still wishes to pursue this project, they must first file for a new Planning application and pay the associated fees. This new application will be reviewed for conformance with the regulations in place at that time. 23. INDEMNITY: To the extent permitted by law, the Applicant shall indemnify and hold harmless the City, its City Council, its officers, employees and agents (the “indemnified parties”) from and against any claim, action, or proceeding brought by a third party against the indemnified parties and the applicant to attack, set aside or void, any permit or approval authorized hereby for the Project, including (without limitation) reimbursing the City for its actual attorneys’ fees and costs incurred in defense of the litigation. The City may, in its sole discretion, elect to defend any such action with attorneys of its own choice. GREEN BUILDING & ENERGY REACH CODE REQUIREMENTS: NOTICE FOR PERMIT APPLICATIONS SUBMITTED ON OR AFTER 1/1/20: Please be advised that the Palo Alto City Council has approved Energy Ordinance 5485 and Green Building Ordinance 5481 for all new permit applications. The Green Building Ordinance has an effective date of January 1st, 2020 and the Energy Reach Code Ordinance has an effective date DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 7 of April 1, 2020. To review the upcoming changes, visit the Development Services webpage .On the left-hand side under “EXPLORE”, hover over “Green Building” and select “Compliance.” You may also email Green Building at GreenBuilding@cityofpaloalto.org for specific questions about your project. 24. GREEN BUILDING CONDITIONS OF APPROVAL a) The project is a new construction residential building of any size** and therefore must meet the California Green Building Code mandatory requirements outlined in Chapter 4, (with local amendments) plus Tier 2 minimum pre-requisites and electives outlined in Appendix A4* (with local amendments). The project must hire a Green Building Special Inspector for a pre-permit third-party design review and a third-party green building inspection process. The project must select a Green Building Special Inspector from the City’s list of approved inspectors. PAMC 16.14.080 (Ord. 5481 § 1, 2019) (1) *Note: Projects subject to Tier 1 or Tier 2 shall not be required to fulfill any requirements outlined in Appendix A4.2 Energy Efficiency. All energy efficiency measures are found in the 2019 California Energy Code and the Palo Alto Energy Reach Code PAMC 16.17 & 16.18 as described in the Energy Reach Code section of this letter. (2) **Accessory Dwelling Unit (Detached) Exception: (a) Free standing detached Accessory Dwelling Units of new construction shall meet the following: (i) California Green Building Standards Code Mandatory plus Tier 2 prerequisite requirements. (ii) No Planning and Design electives. (iii) Two (2) Water Efficiency and Conservation electives. (iv) Two (2) Material Conservation and Resource Efficiency electives. (v) One (1) Environmental Quality elective. b) The project is a residential construction project of any size with a given valuation of $25,000 or more and therefore must meet the enhanced construction waste reduction at Tier 2 (80% construction waste reduction). PAMC 16.14.260 (Ord. 5481 § 1 (part), 2019) c) The project is a new detached single-family, dwelling and therefore shall comply with the following requirements for electric vehicle supply equipment (EVSE): (a) In general. The property owner shall provide Conduit Only, EVSE-Ready Outlet, or EVSE Installed for each residence. The property owner shall provide as minimum a panel capable to accommodate a dedicated branch circuit and service capacity to install at least a 208/240V, 50 amperes grounded AC outlet (Level 2 EVSE). The raceway shall terminate in close proximity to the proposed location of the charging system into a listed cabinet, box, enclosure, or receptacle. The raceway shall be installed so that minimal removal of materials is necessary to complete the final installation. The raceway shall have capacity to accommodate a 100-ampere circuit. (b) Design. The proposed location of a charging station may be internal or external to the dwelling, and shall be in close proximity to an on-site parking space. The DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 8 proposed design must comply with all applicable design guidelines, setbacks and other code requirements. PAMC 16.14.420 (Ord. 5481 §1, 2019) 25. LOCAL ENERGY REACH CODE CONDITIONS OF APPROVAL – Effective 4/1/20 a) The project includes new residential construction of any size and is submitted for building permit on or after April 1, 2020 and therefore triggers the Local Energy Efficiency Reach Code. All new residential construction projects of any size submitted after January 1, 2020 until March 31, 2020 shall comply with statewide mandatory energy standards as outlined in the 2019 California Energy Code, Title 24, Part 6. i) Single-Family Residential Options: (1) New single-family residential construction projects shall be designed to be all-electric. (2) The installation of fireplaces, space-conditioning equipment, water heating system, clothes drying and cooking appliances shall be electric and not fueled by natural gas. (a) An All-Electric Building complies with the performance standard if both the Total Energy Design Rating and the Energy Efficiency Design Rating for the Proposed Building are no greater than the corresponding Energy Design Ratings for the Standard Design Building. (b) The Energy Budget for newly constructed buildings is expressed in terms of the Energy Design Rating, which is based on TDV energy. The Energy Design Rating (EDR) has two components, the Energy Efficiency Design Rating, and the Solar Electric Generation and Demand Flexibility Design Rating. The Solar Electric Generation and Demand Flexibility Design Rating shall be subtracted from the Energy Efficiency Design Rating to determine the Total Energy Design Rating. The Proposed Building shall separately comply with the Energy Efficiency Design Rating and the Total Energy Design Rating. (i) Compliance demonstration requirements for performance standards: Certificate of Compliance. The Certificate of Compliance is prepared and signed by a Certified Energy Analyst and the Total Energy Design Rating of the Proposed Design shall be no greater than the Standard Design Building. (Ord. 5485 §1, 2019) b) Mandatory Photovoltaic (PV) Requirements: i) All new low-rise residential buildings shall have a photovoltaic (PV) system meeting the minimum qualification requirements as specified in Joint Appendix JA11, with annual electrical output equal to or greater than the dwelling’s annual electrical usage. (CEC §150.1, 2019) 26. Additional Green Building and Energy Reach Code information, ordinances and applications can be found at http://www.cityofpaloalto.org/gov/depts/ds/green_building/default.asp. If you have any questions DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 9 regarding Green Building requirements please call the Green Building Consultant at (650) 329-2179 or send an email to GreenBuilding@CityofPaloAlto.org. PUBLIC WORKS URBAN FORESTRY CONDITIONS – Catherine Mondkar catherine.mondkar@cityofpaloalto.org 27. SPECIAL CONDITIONS. The Applicant shall strictly adhere to the recommendations for tree preservation, pneumatic/hand evacuation, and to all tree protection measures as outlined in the 9/22/19 Davey Resources Group arborist report, or as updated thereafter. Additional tree protection protocol shall be followed as specified by Palo Alto Urban Forestry in the following items below. a) The first fourteen feet (14’) of the existing concrete slab closest to tree #5 (72” DBH Valley Oak, Quercus lobata) shall be left in place, abandoned, and therefore shall not demolished. Regarding the remaining portion of the concrete slab to be demolished within the TPZ, the construction procedures as described in Condition 27 below are to be employed for the demolition of the remaining twenty-six feet (26’) of existing concrete slab within the TPZ. 28. SPECIAL TREE PROTECTION MEASURES. The Contractor shall under the supervision of an ISA certified Arborist furnish the following tree protection materials on site prior to commencing demolition of the specified portion of the existing home foundation. a) No heavy equipment or vehicles of any sort are to be used within the tree protection zone (TPZ= DBHx10/12= 60’ TPZ). Hand tools and pneumatic air spades only are to be used within the TPZ for the purpose of demolition. No loading of equipment, materials or objects of any sort may be stored within the TPZ. b) 12” inches of wood chips topped with sheets of plywood shall be furnished within all pervious areas of the tree protection zone within the scope of work prior to beginning demolition. c) As pervious areas within the TPZ are gradually exposed, 12” inches of wood chips topped with sheets of plywood shall be furnished within the remaining areas of the TPZ . d) Only hand and pneumatic excavation are to be used during deconstruction of the existing foundation. e) As demolition progresses and pervious areas are surfaced, any roots exposed to the air for greater than one (1) hour are to be wrapped in burlap to maintain moisture and covered in original soil where possible. f) Following hand and pneumatic demolition of the specified portion on the existing foundation, type I tree protection fencing (as specified on the T-1 sheet) shall be installed to the extent of the TPZ as per plan drawings and maintained for the duration of the project. 29. TREE PROTECTION INSPECTIONS. In addition to standard tree protection fencing inspections, at the time of pneumatic demolition around tree #5, City Staff will perform a tree protection inspection to ensure that hand excavation and tree protection measures are being met as outlined in the above- mentioned conditions of approval. Following demolition of the specified portion of the foundation, another tree protection inspection by City staff will take place to ensure that the required fencing is in place. DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 10 30. ARBORIST CONSTRUCTION SUPERVISION. For the duration of hand demolition within the TPZ, the project Arborist shall make a daily visit on site to ensure that tree protection measures, materials and best practices are being employed by the contractor and on-site foreman overseeing the work. 31. TREE APPRAISAL. Prior to the issuance of a grading or building permit, the applicant shall prepare and secure a tree appraisal for tree #5 (72” DBH Valley Oak, Quercus lobata). The appraisal of the condition and replacement value of tree #5 shall recognize the location of the tree in the proposed development. The appraisal may be part of the Tree Survey Report or listed separately. For the purposes of tree appraisal, the monetary market or replacement value shall be determined using the most recent version of the “Guide for Plant Appraisal”, in conjunction with the Species and Classification Guide for Northern California. The appraisal shall be performed at the applicant’s expense, and the appraiser shall be subject to the Director’s approval. See PAMC 8.10.020(k)(2), 8.10.110 (b)(2), and sections 6.25 and 6.40 of the Palo Alto Tree Technical Manual. 32. TREE APPRAISAL DURATION. The tree appraisal duration period shall be five years from the date of final occupancy. A tree shall be considered dead when the main leader has died back, 25% of the crown is dead or if major trunk or root damage is evident. A new tree or trees of equal or greater appraised value shall be planted in the same area by the property owner. Landscape area and irrigation shall be readapted to provide optimum growing conditions for the replacement tree(s). The replacement tree(s) that are planted shall be subject to a new two-year establishment and monitoring program. The project sponsor shall provide an annual tree evaluation report as originally required. 33. TREE PROTECTION COMPLIANCE. The owner and contractor shall implement all protection and inspection schedule measures, design recommendations and construction scheduling as stated in the TPR & Sheet T-1, and is subject to code compliance action pursuant to PAMC 8.10.080. The required protective fencing shall remain in place until final landscaping and inspection of the project. Project arborist approval must be obtained and documented in the monthly activity report sent to the City. The mandatory Contractor and Arborist Monthly Tree Activity Report shall be sent monthly to the City (pwps@cityofpaloalto.org) beginning with the initial verification approval, using the template in the Tree Technical Manual, Addendum 11. 34. PLAN CHANGES. Revisions and/or changes to plans before or during construction shall be reviewed and responded to by the (a) project site arborist, or (b) landscape architect with written letter of acceptance before submitting the revision to the Building Department for review by Planning, PW or Urban Forestry. 35. TREE DAMAGE. Tree Damage, Injury Mitigation and Inspections apply to Contractor. Reporting, injury mitigation measures and arborist inspection schedule (1-5) apply pursuant to TTM, Section 2.20- 2.30. Contractor shall be responsible for the repair or replacement of any publicly owned or protected trees that are damaged during the course of construction, pursuant to Title 8 of the Palo Alto Municipal Code, and city Tree Technical Manual, Section 2.25. DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 11 36. GENERAL. The following general tree preservation measures apply to all trees to be retained: No storage of material, topsoil, vehicles or equipment shall be permitted within the tree enclosure area. The ground under and around the tree canopy area shall not be altered. Trees to be retained shall be irrigated, aerated and maintained as necessary to ensure survival. 37. BUILDING PERMIT SUBMITTAL- PROJECT ARBORIST CERTIFICATION LETTER. Prior to submittal for staff review, attach a Project Arborist Certification Letter that he/she has; (a) reviewed the entire building permit plan set submittal and, (b) affirm that ongoing Contractor/Project Arborist site monitoring inspections and reporting have been arranged with the contractor or owner (see Sheet T-1) and, (c) understands that design revisions (site or plan changes) within a TPZ will be routed to Project Arborist/Contractor for review prior to approval from City. 38. TREE PROTECTION VERIFICATION. Prior to any site work verification from the contractor that the required protective fencing is in place shall be submitted to the Urban Forestry Section. The fencing shall contain required warning sign and remain in place until final inspection of the project. 39. EXCAVATION RESTRICTIONS APPLY (TTM, Sec. 2.20 C & D). Any approved grading, digging or trenching beneath a tree canopy shall be performed using ‘air-spade’ method as a preference, with manual hand shovel as a backup. For utility trenching, including sewer line, roots exposed with diameter of 1.5 inches and greater shall remain intact and not be damaged. If directional boring method is used to tunnel beneath roots, then Table 2-1, Trenching and Tunneling Distance, shall be printed on the final plans to be implemented by Contractor. 40. PLAN SET REQUIREMENTS. The final Plans submitted for building permit shall include the following information and notes on relevant plan sheets: a) SHEET T-1, BUILDING PERMIT. The building permit plan set will include the City’s full-sized, Sheet T-1 (Tree Protection-it's Part of the Plan!), available on the Development Center website at http://www.cityofpaloalto.org/civicax/filebank/documents/31783. The Applicant shall complete and sign the Tree Disclosure Statement and recognize the Project Arborist Tree Activity Inspection Schedule. Monthly reporting to Urban Forestry/Contractor is mandatory. (Insp. #1: applies to all projects; with tree preservation report: Insp. #1-7 applies) b) The Tree Preservation Report (TPR). All sheets of the Applicant’s TPR approved by the City for full implementation by Contractor, shall be printed on numbered Sheet T-1 (T-2, T-3, etc) and added to the sheet index. c) Plans to show protective tree fencing. The Plan Set (esp. site, demolition, grading & drainage, foundation, irrigation, tree disposition, utility sheets, etc.) must delineate/show the correct configuration of Type I, Type II or Type III fencing around each Regulated Tree, using a bold dashed line enclosing the Tree Protection Zone (Standard Dwg. #605, Sheet T-1; City Tree Technical Manual, Section 6.35-Site Plans); or by using the Project Arborist’s unique diagram for each Tree Protection Zone enclosure. DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 12 PUBLIC WORKS ENGINEERING CONDITIONS – Ajay Kumar ajay.kumar@cityofpaloalto.org The following shall be addressed prior to issuance of a Building Permit, Excavation and Grading Permit, Certificate of Compliance, Street Work Permit and/or Encroachment Permit. 41. DEMOLITION PLAN: Place the following note adjacent to an affected tree on the Site Plan and Demolition Plan: “Excavation activities associated with the proposed scope of work shall occur no closer than 10-feet from the existing street tree, or as approved by the Urban Forestry Division contact 650-496-5953. Any changes shall be approved by the same”. 42. GRADING PERMIT: Separate Excavation and Grading Permit will be required for grading activities on private property that fill, excavate, store or dispose of 100 cubic yards or more based on PAMC Section 16.28.060. Applicant shall prepare and submit an excavation and grading permit to Public Works separately from the building permit set. The permit application and instructions are available at the Development Center and on our website. http://www.cityofpaloalto.org/gov/depts/pwd/forms_and_permits.asp 43. GRADING & DRAINAGE PLAN: The plan set must include a grading & drainage plan prepared by a licensed professional that includes existing and proposed spot elevations, earthwork volumes, finished floor elevations, area drain and bubbler locations, drainage flow arrows to demonstrate proper drainage of the site. Adjacent grades must slope away from the house a minimum of 2% or 5% for 10-feet per 2013 CBC section 1804.3. Downspouts and splashblocks should be shown on this plan, as well as any site drainage features such as swales, area drains, bubblers, etc. Grading that increases drainage onto, or blocks existing drainage from neighboring properties, will not be allowed. Public Works generally does not allow rainwater to be collected and discharged into the street gutter, but encourages the developer to keep rainwater onsite as much as feasible by directing runoff to landscaped and other pervious areas of the site. See the Grading & Drainage Plan Guidelines for New Single Family Residences on the City’s website. http://www.cityofpaloalto.org/civicax/filebank/documents/2717 44. BASEMENT DRAINAGE: Due to high groundwater throughout much of the City and Public Works prohibiting the pumping and discharging of groundwater, perforated pipe drainage systems at the exterior of the basement walls or under the slab are not allowed for this site. A drainage system is, however, required for all exterior basement-level spaces, such as lightwells, patios or stairwells. This system consists of a sump, a sump pump, a backflow preventer, and a closed pipe from the pump to a dissipation device onsite at least 10-feet from the property line and 3-feet from side an rear property lines, such as a bubbler box in a landscaped area, so that water can percolate into the soil and/or sheet flow across the site. Include these dimensions on the plan. The device must not allow stagnant water that could become mosquito habitat. Additionally, the plans must show that exterior basement-level spaces are at least 7-3/4” below any adjacent windowsills or doorsills to minimize the potential for flooding the basement. Public Works recommends a waterproofing consultant be retained to design and inspect the vapor barrier and waterproofing systems for the basement. DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 13 45. BASEMENT SHORING: Shoring Plans prepared by a licensed professional are required for the Basement Excavation and shall be submitted with the Grading and Excavation Permit. Shoring for the basement excavation, including tiebacks, must not extend onto adjacent private property or into the City right-of-way without having first obtained written permission from the private property owners and/or an encroachment permit from Public Works. 46. The site drainage system that collects runoff from downspouts and landscape area shall be a separated from the pump system that discharges runoff from light wells. Plot and clearly label the two separate systems and including the separate outfalls for each system. 47. UTILITIES: Note that all above ground utilities, such as transformer, backflow preventer, gas meters, etc., shall be located within project site but accessible from the street. Any new or relocated utilities will correspond with approved locations from City Utilities Department. 48. GEOTECHNICAL REPORT: Shall clearly identify the highest projected groundwater level to be encountered in the area of the proposed basement in the future will be ______ feet below existing grade. Provide the following note on the Final Grading Plans. “In my professional judgement, the highest projected groundwater level to be encountered in the area of the proposed basement in the future will be ______ feet below existing grade. As a result, the proposed drainage system for the basement retaining wall will not encounter and pump groundwater during the life of this wall.” 49. DEWATERING: Excavation may require dewatering during construction. Public Works only allows groundwater drawdown well dewatering. Open pit groundwater dewatering is not allowed. Dewatering is only allowed from April through October due to inadequate capacity in our storm drain system. The geotechnical report for this site must list the highest anticipated groundwater level. We recommend that a piezometer be installed in the soil boring. The contractor shall determine the depth to groundwater immediately prior to excavation by using a piezometer or by drilling and exploratory hole. Based on the determined groundwater depth and season the contractor may be required to dewater the site or stop all grading and excavation work. In addition Public Works may require that all groundwater be tested for contaminants prior to initial discharge and at intervals during dewatering. If testing is required, the contractor must retain an independent testing firm to test the discharge water for contaminants Public Works specifies and submit the results to Public Works. Public Works reviews and approves dewatering plans as part of a Grading Permit and Dewatering Permit. The applicant can include a dewatering plan in the building permit plan set in order to obtain approval of the plan during the building permit review, but the contractor will still be required to obtain a Grading Permit prior to dewatering. Alternatively, the applicant must include the above dewatering requirements in a note on the site plan. Public Works has dewatering guidelines available at the Development Center and on our website. https://www.cityofpaloalto.org/gov/depts/pwd/forms_and_permits/default.asp DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 14 50. WATER FILLING STATION: applicant shall install a water station for the non-potable reuse of the dewatering water. This water station shall be constructed within private property, next to the right- of-way, (typically, behind the sidewalk). The station shall be accessible 24 hours a day for the filling of water carrying vehicles (i.e. street sweepers, etc.). The water station may also be used for onsite dust control. Before a discharge permit can be issued, the water supply station shall be installed, ready for operational and inspected by Public Works. The groundwater will also need to be tested for contaminants and chemical properties for the non-potable use. The discharge permit cannot be issued until the test results are received. Additional information regarding the station will be made available on the City’s website under Public Works. 51. WORK IN THE RIGHT-OF-WAY: The plans must clearly indicate any work that is proposed in the public right-of-way, such as sidewalk replacement, driveway approach, or utility laterals. The plans must include notes that the work must be done per City standards and that the contractor performing this work must first obtain a Street Work Permit from Public Works at the Development Center. If a new driveway is in a different location than the existing driveway, then the sidewalk associated with the new driveway must be replaced with a thickened (6” thick instead of the standard 4” thick) section. Additionally, curb cuts and driveway approaches for abandoned driveways must be replaced with new curb, gutter and planter strip. 52. Provide the following note on the Site Plan and adjacent to the work within the Public road right- of-way. “Any construction within the city’s public road right-of-way shall have an approved Permit for Construction in the Public Street prior to commencement of this work. THE PERFORMANCE OF THIS WORK IS NOT AUTHORIZED BY THE BUILDING PERMIT ISSUANCE BUT SHOWN ON THE BUILDING PERMIT FOR INFORMATION ONLY.” 53. Provide the following note on the Site Plan and Grading and Drainage Plan: “Contractor shall not stage, store, or stockpile any material or equipment within the public road right-of-way.” Construction phasing shall be coordinate to keep materials and equipment onsite. 54. SIDEWALK, CURB & GUTTER: As part of this project, the applicant shall replace those portions of the existing sidewalks, curbs, gutters or driveway approaches in the public right-of-way along the frontage(s) of the property. Contact Public Works’ inspector at 650-496-6929 to arrange a site visit so that the inspector can discuss the extent of replacement work along the public road. The site plan submitted with the building permit plan set must show the extent of the replacement work. The plan must note that any work in the right-of-way must be done per Public Works’ standards by a licensed contractor who must first obtain a Street Work Permit from Public Works at the Development Center. Provide site direction sheet obtained from PW inspector in plan set. 55. Any existing driveway to be abandoned shall be replaced with standard curb & gutter. This work must be included within a Permit for Construction in the Public Street from the Public Works DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD 2353 Webster Street 18PLN-00339 March 16, 2020 15 Department. A note of this requirement shall be placed on the plans adjacent to the area on the Site Plan. 56. IMPERVIOUS SURFACE AREA: The project will be creating or replacing 500 square feet or more of impervious surface. Accordingly, the applicant shall provide calculations of the existing and proposed impervious surface areas with the building permit application. The Impervious Area Worksheet for Land Developments form and instructions are available at the Development Center or on our website. 57. PUBLIC WORKS STANDARDS CONDITIONS: The City's full-sized "Standard Conditions" sheet must be included in the plan set. Copies are available from Public Works on our website: http://www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=67175.06&BlobID=66261 58. STORM WATER POLLUTION PREVENTION: The City's full-sized "Pollution Prevention - It's Part of the Plan" sheet must be included in the plan set. Copies are available from Public Works on our website http://www.cityofpaloalto.org/civicax/filebank/documents/2732 59. This project triggers the California Regional Water Quality Control Board’s revised provision C.3 for storm water regulations (incorporated into the Palo Alto Municipal Code, Section 16.11) that apply to residential land development projects that create or replace between 2,500 and 10,000 square feet of impervious surface area. The applicant must implement one or more of the following site design measures on the grading and drainage plan:  Direct roof runoff into cisterns or rain barrels for reuse.  Direct roof runoff onto vegetated areas.  Direct runoff from sidewalks, walkways, and/or patios onto vegetated areas.  Direct runoff from driveways and/or uncovered parking lots onto vegetated areas.  Construct sidewalks, walkways, and/or patios with permeable surfaces.  Construct driveways, and/or uncovered parking lots with permeable surfaces 60. Provide the following as a note on the Site Plan: “The contractor may be required to submit a logistics plan to the Public Works Department prior to commencing work that addresses all impacts to the City’s right-of-way, including, but not limited to: pedestrian control, traffic control, truck routes, material deliveries, contractor’s parking, concrete pours, crane lifts, work hours, noise control, dust control, storm water pollution prevention, contractor’s contact, noticing of affected surrounding properties , and schedule of work. The requirement to submit a logistics plan will be dependent on the number of applications Public Works Engineering receives within close proximity to help mitigate and control the impact to the public-right-of-way. If necessary, Public Works may require a Logistics Plan during construction.” End Project Conditions DocuSign Envelope ID: 5F69F71E-F7A2-4BBE-A368-09596D6D50FD UPDATED: February 26, 2020 1 Regulations for Groundwater Dewatering during Construction of Below Ground Structures A How-to Guide to Meeting City of Palo Alto Dewatering Requirements I. BACKGROUND In recent years, concerns that temporary construction-related groundwater dewatering may be wasting water, potentially damaging structures, trees and vegetation, and depleting or altering the flow of groundwater, have arisen. In response, the City of Palo Alto (City) established new requirements in February 2016 designed to minimize and standardize the process of pumping and discharge of groundwater from dewatering of below ground structures (e.g., basement or parking garage) during construction. After the results of new groundwater dewatering regulations from the 2016 and 2017 Construction Seasons, the City Council approved several enhancements to the dewatering policy that were codified in the Palo Alto Municipal Code and went into effect in May 2017, and again in December 2017 (Attachment 1). The 2017 changes included improving Fill Station performance, monitoring actual groundwater elevation changes during assessing impacts on nearby structures, clarifying reporting requirements, and a Hydrogeological Study (Study). This guide provides further explanation regarding the most recent code changes (which became effective on February 21, 2018) and is intended to assist project applicants in meeting code requirements. II. GENERAL GROUNDWATER DEWATERING REQUIREMENTS Note that this document is in reference to temporary groundwater dewatering during construction of below ground structures. This document does not contain information regarding dewatering of existing below ground structures in the City of Palo Alto. Temporary construction-related groundwater dewatering (dewatering) may be conducted using 1) groundwater exclusionary techniques (e.g., secant or cut-off walls), or 2) controlled groundwater pumping, also known as drawdown well dewatering. The City’s Public Works Department (Public Works) does not allow open pit dewatering of groundwater during construction; however, it may be allowed, if water quality limits are met, for removal of rainwater if it has accumulated at the bottom of an excavation site. If rainwater dewatering is required, the project manager/applicant must contact the City’s Watershed Protection Group at (650) 329-2122 before discharging to the City’s storm drain system. Attachment 2 provides applicants a basic flow chart to understand the City’s compliance process regarding the two types of allowed construction dewatering. To assist the City in determining whether dewatering will likely be required in the construction of below ground structures, the project applicant must submit a Geotechnical Report, also known as a soils report, (separate from the Hydrogeological Study described below) prior to the Building Permit application. In addition, if the deepest excavation will be within five feet of the anticipated groundwater level stated in the Geotechnical Report, the contractor must determine the depth to groundwater immediately prior to submittal of the Excavation and Grading Permit. It is recommended that the boring hole for this depth measurement be protected and maintained and used as the monitoring well for the dewatering operations. UPDATED: February 26, 2020 2 As discussed later in this document, all dewatering sites are required to install a monitoring well onsite at the farthest feasible point from the underground structure. Placing this boring correctly and protecting it may avoid future work. If groundwater is found to be within two feet of the deepest excavation, a drawdown well dewatering system or cutoff wall must be installed. Regardless of this testing, if groundwater is actually encountered during construction (and the applicant does not have a dewatering permit), the contractor must immediately stop all work and must meet all of the following requirements prior to resuming work. The City’s dewatering season is April 1 through October 31 due to the capacity of the City's storm drain system. Dewatering to the sanitary sewer system is prohibited, exceptions may be allowed only under special circumstances and with a discharge permit obtained through Public Works’ Watershed Protection Group. During the dewatering season, sites will be allowed to dewater for a 12-week time period, including a two-week start-up period. The two-week start-up period is intended to provide adequate time for the contractor to meet the City’s dewatering requirements as well as City staff to inspect and monitor the dewatering start-up operation. At the end of the two-week start-up period, compliance with all performance standards and water quality standards, the hydrogeological study data, shall be demonstrated in order to continue dewatering. Residential sites are expected to complete dewatering within the allotted time period. Dewatering beyond 12 weeks is allowed only under special circumstances and if approved by the City Engineer. The City will consider allowing groundwater discharges to occur (to the storm drain system) from November 1 to March 31 if the applicant can provide sufficient evidence that the receiving storm drain line and water body has sufficient capacity to accommodate a 10-year, 6-hour storm event in addition to the dewatering discharge (a pipe capacity calculation). Where dewatering is required, applicants shall conduct dewatering in full compliance with the provisions of Chapter 16.28 (Excavation, Grading and Fills) as well as Chapter 9.10 (Noise) of the City’s Municipal Code, the regulations in this guide, and other permit conditions established by City staff. Due to the complexity of dewatering projects, City staff may impose and enforce additional requirements when or after a permit is issued in order to ensure public safety, ensure the condition of its infrastructure, or to protect the water quality of downstream water bodies. During the period of construction and dewatering discharge, project applicants/permittees are expected to promptly implement actions identified and required by City staff, including, but not limited to, notices of non-compliance and directives requiring immediate cessation of discharge. Administrative penalties may be put into effect for sites not in compliance with any of the City requirements, and will accrue if the applicant does not comply as requested by the City. A cessation order may be issued for reasons including, but not limited to: capacity issues in the storm drain or sanitary sewer systems; storm drain or sanitary sewer system failures; excess flow entering the Palo Alto Regional Water Quality Control Plant, including exceptional storm events; emergency or routine maintenance of City infrastructure; protection of the environment, public health, safety and welfare; and failure to follow the terms/conditions/requirements of any permit. UPDATED: February 26, 2020 3 NOTE: All information contained in the dewatering permit application, dewatering permit, supporting documents, and the associated street work permit will be made available to the public upon request. III. GROUNDWATER EXCLUSIONARY TECHNIQUE REQUIREMENTS If the rate of groundwater discharge is greater than thirty gallons per minute for residential sites, groundwater exclusionary techniques cannot be used, and the requirements of Subsections IV (below) shall be followed. When groundwater exclusionary techniques are utilized, applicants must submit to the City a Dewatering Permit – Groundwater Exclusionary Technique packet with a Grading and Excavation Permit application (after Planning entitlement is approved). The Grading and Excavation Permit for a project will not be issued until all required submittals related to dewatering have been submitted, reviewed and approved by Public Works Engineering staff. The (Exclusionary Techniques) Dewatering Packet (Attachment 3) shall include the following: 1) Exclusionary Technique Permit form, 2) Exclusionary Technique plan, and 3) Inspection Checklist. Groundwater exclusionary techniques shall be conducted in compliance with the following: A. The rate of discharge of groundwater shall be limited to thirty gpm or less for residential dewatering projects. B. The Dewatering Plan shall be followed at all times and shall consist of a plan view of the project site and include all required features of the dewatering operation such as but not limited to: metered settling tank and it’s safely accessible location onsite, monitoring well at the farthest feasible onsite point from the excavation, location and size of percolation pits, pump location/s, associated piping, and stabilized construction entrance. C. Groundwater Use Plan shall illustrate how the groundwater will be used to the maximum extent practicable and without discharge to the storm drain system. When feasible, the primary focus of discharge shall be to percolate the discharge onto the construction property, usually into percolation pits. A secondary method of discharge should be to percolate the groundwater onto adjacent neighbor properties upon their permission (this should be handled between the project applicant and the property owners without facilitation or further approval from the City). Finally, the groundwater may be trucked offsite and, in coordination with the City’s Urban Forestry and/or Parks and Recreation staff, distributed throughout the City to locations that can use the water. D. The applicant shall install a groundwater monitoring well at the site. It shall be located at the farthest feasible onsite point from the underground structure. Initial groundwater level results must be included in the dewatering plan (same data point as the one required prior to grading and excavation permit application). E. Project status reporting: During the construction period of the underground structure, the applicant must submit periodic groundwater level reports and have the data available per request. At minimum, monitoring well data shall be collected daily for the first two weeks beginning with the start of the excavation UPDATED: February 26, 2020 4 activity and weekly thereafter. A final report shall be submitted two weeks after pumping of residual water ceases. All status reports should be submitted to Public Works Engineering (PWE) staff at the Development Center, email to the PWE staff person reviewing the project is preferred. Questions should be directed to pwecips@CityofPaloAlto.org. NOTE: Administrative Penalties may be imposed upon failure to follow the required reporting frequency. IV. CONTROLLED GROUNDWATER PUMPING (WITHOUT A SECANT OR CUT-OFF WALL) REQUIREMENTS When controlled groundwater pumping techniques are utilized, applicants must submit to the City a Dewatering Permit – Controlled Groundwater Pumping Packet with the Excavation and Grading Permit and Street Work Permit applications (after Planning entitlement is approved). The Excavation and Grading permit for a project will not be issued until all required submittals have been received, reviewed, and approved by PWE staff. A Dewatering Permit must be obtained before any discharge from the site occurs. Note that for residential projects, the Excavation and Grading Permit is only issued concurrently with the Building Permit. While discharging to the storm drain system, construction work on the underground structure shall be continuous and occur daily (in accordance with approved work hours). The contractor shall make progress towards completion of the underground structure without delay and following the detailed construction schedule provided in the Excavation and Grading Permit and/or the Dewatering Permit packet. In addition to what is required for exclusionary techniques (aside from the cut-off wall itself and the 30 gpm limitation), a Hydrogeological Study and an in-depth Groundwater Use Plan must also be submitted. Refer to the Controlled Groundwater Pumping Dewatering Permit Packet in Attachment 4 for more information. The following provides additional details regarding the City’s controlled groundwater pumping requirements: HYDROGEOLOGICAL STUDY REQUIREMENTS HAVE CHANGED: Public Works will no longer accept the use of “single layer models” to analyze subsurface soil condition of a particular parcel or project site where an underground structure is proposed and where dewatering is required. A “single layer model” is defined as any calculation, computer program or other method, which models the composition and/or properties of subsurface soils as a single, homogeneous layer of material. Site specific tests shall be performed to generate data in order to model the subsurface soil properties and produce a more accurate, site-specific, model. Additional information is detailed below. As with exclusionary techniques, the applicant shall install a groundwater monitoring well on the construction site at the farthest feasible point from the underground structure. Initial groundwater level results must be included in the Hydrogeological Study. During the construction period of the underground structure, the applicant must submit frequent groundwater level reports and have the data available per request. At minimum, monitoring well data shall be conducted daily for the first two weeks of the 12-week period and weekly UPDATED: February 26, 2020 5 thereafter. At the end of the two week start-up period, or thereafter, if drawdown results are greater than anticipated, the applicant shall submit a revised Dewatering Hydrogeological Study and any revised conclusions on impacts of the groundwater drawdown. A. Dewatering Hydrogeological Study - The purpose of this Study is to determine the initial, pre-construction groundwater levels as well as the impacts of groundwater pumping on the site and surrounding area. The Study should include the radius of influence (i.e. extent of cone of depression) from each dewatering well (if more than one is installed on-site) as a function of time, based on local soil and groundwater conditions. The Hydrogeological Study shall demonstrate that the dewatering plan has been designed to the maximum extent practicable to minimize the volume of water pumped during the dewatering operation, the flow rate, and the duration of the pumping. The Study shall be stamped by a California licensed Hydrogeologist or California licensed Geotechnical Engineer and submitted to the City as part of the Dewatering Packet. The Study should also include the following items: i. A minimum of 4 borings or other subsurface tests (Cone Penetrometer Tests, CPTs, are preferred) shall be performed across the project site/excavation area by a California licensed Geotechnical Engineer in order to develop a multilayer model of the subsurface soil conditions and properties. The tests should be performed to a depth of no less than 30 feet below existing grade (for residential projects). The test data shall be used to create a multi-layer model of subsurface conditions; single-layer models which model site conditions as a homogenous layer will not be accepted. 1. The data shall be used to design a dewatering plan based on the subsurface conditions/strata which results in the minimization of pumped water to the maximum extent practicable. 2. Well depth shall be specified based upon the subsurface conditions. 3. The pump depth within the dewatering well shall be specified based on the subsurface conditions and required drawdown. ii. A description and cross section(s) of the cone(s) of depression of any on- site monitoring well(s) as well as any nearby dewatering sites within a 400-foot radius of the property that may interact with or be influenced by the dewatering activity at the site. The location of the monitoring well(s) and nearby sites should also be shown on a map. iii. Anticipated drawdown curve and pumping flow rate. A description and cross section(s) of the cones of depression of the dewatering wells shall be calculated and graphed. The predicted drawdown level (depth to groundwater) at the onsite monitoring well shall be shown as a function of time; accurately graphed cross sections with data points or tabular data format shall be provided. The anticipated pumping flow rate shall be calculated for the dewatering system as well as the total volume due to be pumped for the 12 week dewatering period and daily totals. UPDATED: February 26, 2020 6 1. NOTE: The depth of each dewatering well pump will be verified in the field once installed and prior to any dewatering operations. iv. Using extrapolated data from the drawdown curves, determine the pumping rates needed to achieve the following drawdown performance: Prior to pouring a basement slab, groundwater may be pumped no deeper than three feet below the depth of the slab, measured at the center. After the slab is poured, groundwater may be pumped no deeper than one foot below the center. These values can be extrapolated using the (verified) drawdown curves and the on-site monitoring well data points. B. Groundwater Use Plan (Plan) shall demonstrate how the pumped groundwater will be used to the maximum extent practicable. Two required components of this plan are the 1) groundwater flow meter and sediment settling tank system and 2) the Fill Station. Both components must be inspected and approved by City staff before obtaining a Controlled Groundwater Pumping Dewatering Permit. Inspections and approvals are documented via the Inspection Checklist (Attachment 4), which must be signed by a Public Works Inspector prior to issuing the Grading Permit, Dewatering Permit, Street Work permit, and associated Building Permit; no Dewatering Permit will be issued without a Public Works Inspector–signed Checklist. At a minimum, the Plan should include the items below; however, the applicant should be creative in their plan to use the pumped groundwater and shall adhere to the Plan throughout the dewatering period: i. Groundwater flow meter and sediment settling tank system: 1. Provide an accurate, non-mechanical flow meter with a data logger in good working condition at the inlet of the tank. The flow meter shall be positioned in a location which is safely accessible by City inspectors on a regular basis. Both flow rate and total flow measurements shall be easily readable and set to gallons. Before any water is pumped, the initial flow meter reading shall be checked and verified by the Watershed Protection Inspector (WP Inspector) as part of the initial dewatering Inspection Checklist approval process. The WP Inspector will collect meter readings on a daily basis during the two-week start-up period and weekly thereafter; the contractor is required to also monitor and record the meter readings using the same frequency. a. The area surrounding the tank should be kept clear at all times, with a safe pathway to the meter and tank. b. The edge of the tank should not be at the edge of the excavation area, as it may lead to unsafe conditions. c. The contractor shall contact PW Inspection prior to changing or replacing any meter. d. The point of outlet on the settling tank cannot be at the bottom of the settling tank. e. The settling tank must have a discharge valve which can be locked in a closed position. PW or WP Inspectors will UPDATED: February 26, 2020 7 lock the discharge valve to ensure that the erroneous discharge does not occur and that the City is notified and aware of exactly when discharge begins. Further sections below explain this process in greater detail. 2. Design the tank system so that the storage tank is always at minimum one-half full during the entire dewatering period to facilitate water truck usage. 3. Prior to the start-up period and as part of the Inspection Checklist process, once the tank is at least half-full and before any discharge of groundwater occurs, contact Watershed Protection at (650) 329-2122 for an initial inspection and for water quality testing. For non-(contaminated) plume areas, basic measurements will generally include pH, conductivity and turbidity. 4. After the WP Inspector collects water quality samples and provides a clearance that the sample is within acceptable limits, the contractor will contact the WP Inspector to temporarily unlock the tank discharge valve to allow the tank to be drained to the property while waiting to obtain the Dewatering Permit Packet from Public Works Engineering. Consult the WP Inspector for assistance. Provide a screen or other covering over the tank for mosquito management. City staff may require the use of Bacillus thuringiensis israelensis (Bti), a naturally occurring soil bacterium that effectively kills mosquito larvae, if necessary. ii. A Fill Station shall be constructed to provide the City and nearby residents and business owners the opportunity to use the pumped groundwater and to minimize the amount discharged to the storm drain system. The Fill Station should include two methods for water distribution: a truck-filling outlet for water truck distribution to sites in the City and a fill-up outlet, or hose bibbs, for neighboring properties. Detailed information about the fill station and its components is listed below. When the Fill Station is ready, contact Public Works Engineering Inspection staff (PWE Inspector) at (650) 496-6929 for an inspection of both the Fill Station and settling tank system and contact Building Inspection staff at (650) 444-6173 for an Electrical Safety Check. (Inspectors must check off these items on the Inspection Checklist.) The following is required for the Fill Station: 1. Location and set-up: • Locate the Fill Station outside the site construction fence to allow 24-hour access. The construction site should be locked outside of normal construction hours. • A lock is not required at the Fill Station, but if the applicant deems it necessary, a combination lock should be used with the combination of 2, 4, 6, 8 (or other easily UPDATED: February 26, 2020 8 remembered combination and shared with City Inspectors). • Truck fill outlet: provide a 2.5-inch hydrant fitting hose connection with a 50-foot traffic-rated hose. • Neighboring properties fill outlet: provide at least two 100-foot (minimum) hoses arranged on reels and connected to standard hose bibs. Hose bibs shall produce a minimum of 10gpm at the end of each 100 foot hose simultaneously. The applicant shall allow adjacent properties to use hoses connected to the fill station(s). Hoses shall be placed in a manner that is safe to the public and does not cause damage to neighboring or City property. Hoses shall not cross the street. The City may modify these requirements as circumstances require. • As with the tank system, the fill station shall include accurate and safely accessible, non-mechanical flow meters with data loggers in good working condition at the outlet point of the Fill Station to log water reuse. Both flow rate and total flow measurements shall be easily readable and set to gallons. The initial flow meter reading should be noted before any water is pumped. Flow meter reading shall be checked and verified by the PWE or WP Inspector as part of the initial dewatering approval process, Inspection Checklist. The WP Inspector will collect Fill Station meter readings on a daily basis during the two- week start-up period and weekly thereafter; the contractor is required to also monitor and record the meter readings using the same frequency. • Supply log sheets and a pen for truck drivers to log the truck company, date, and amount of each fill-up. • The temporary power source needed for the Fill Station should be placed inside the construction site (and NOT in the Fill Station), if possible. If needed, a switch with an in- use cover to power on the Fill Station pump may be placed inside the fill station cabinet. An additional switch with an in-use cover for the truck-fill hose pump should be provided. Both switches should be clearly labeled. • Provide easy-to-read signage for the Fill Station (including “Do not Drink”) and directions explaining how to use it. • For the hose bibs, provide signage that reads "No Hoses Crossing Street, Sidewalk, or Private Properties." 2. The applicant must demonstrate maximum 10-minute fill time for a ~2700 gallon water truck as part of the Inspection Checklist signoff. 3. Prior to the commencement of dewatering activities, the applicant shall notify occupants of neighboring properties of the temporary availability of water. Contact Public Works Engineering UPDATED: February 26, 2020 9 staff (650 329-2496, Option 8) for copies of door hangers to be used for notification. Door hangers not collected/received by the residents must be removed after 24 hours. iii. Irrigation of sites: The applicant is responsible for having the pumped groundwater delivered to nearby sites as directed by the City. The applicant shall contract with or otherwise provide water truck service; the water truck operator/company shall contact the City’s Urban Forestry staff should be contacted by the truck service company at (650) 496-5986 to determine the location of sites to be irrigated. During the first six weeks of dewatering activities (not including the two-week start-up period), water should be trucked one full day (8 hours) per week from the project site to the irrigation sites. This shall increase to five days per week (8 hours per day) during the remaining 4 weeks of the dewatering period. iv. On-site Use of Groundwater: Pumped groundwater should be used on the construction site as needed and whenever possible. This includes controlled infiltration, irrigation of existing landscaping, dust suppression and other construction needs. C. A Pre-construction Building Condition Survey and Report of structures located on adjacent parcels prepared by a licensed surveyor and meeting City standards must be submitted, reviewed, and approved prior to obtaining a dewatering permit. The survey must be prepared by a California licensed surveyor whereas the photographic and narrative report may be prepared by the applicant. Both documents shall be submitted at the same time as one report. The applicant is responsible for obtaining permission from neighboring property owners to enter their property to take survey points of the building interior. If permission is not granted, City staff should be notified; however, interior survey points are not required in order to obtain a Dewatering Permit. The survey shall include a photographic and narrative report on the external condition of each structure as well as surveyed and marked elevations of adjacent parcels, with particular attention to the condition of concrete foundations, structural connections, brickwork, plasterwork and other architectural finishes that are susceptible to cracking. The report shall assess the likelihood that the proposed dewatering would cause effects (including but not limited to settlement or movement) on off- site private or public structures or infrastructure, including the right-of-way, easements, and utilities within public utility easements, and the health or viability of vegetation or trees. To the extent that the report concludes that off-site effects are reasonably likely to occur, the applicant shall identify avoidance measures to be implemented that will minimize the type and severity of those effects and shall develop a monitoring plan to assess any actual effects on vegetation, trees, structures and infrastructure. D. A pipe capacity calculation is required. This calculation shall show that the storm drain inlet to which the dewatering water is proposed to be discharged to can accommodate the anticipated dewatering discharge in addition to a 10-year, 6 hour storm event. PW Engineering can assist in providing the appropriate storm UPDATED: February 26, 2020 10 drain staff for assistance. NOTE: If the pipe capacity analysis determines that the storm drain discharge point cannot accommodate the dewatering flow in addition to the 10 year, 6 hour, storm event, a Dewatering permit CANNOT be issued the day-of or after the date which is 12 weeks prior to October 31st. In other words, dewatering cannot begin within 12 weeks of October 31st. E. A detailed construction schedule must be included in the dewatering permit application packet. This schedule shall detail construction phases such as, but not limited to: a. Equipment mobilization b. Shoring installation c. Dewatering plan setup d. Excavation activity e. Dewatering start f. Finished excavation g. Basement construction – base rock, rebar, forms, plumbing, concrete, waterproofing, etc. h. Backfill i. Dewatering end The construction schedule shall list the duration of each step in days/weeks and total the number of weeks between Dewatering start and Dewatering end. F. A Dewatering Regulation Acknowledgement Statement must be signed by the property owner/s and licensed contractor and shall accompany the dewatering application. G. Contractor is required to begin shoring installation and excavation once the Excavation and Grading permit is issued and PRIOR to any dewatering operations. In order to minimize the volume of groundwater discharged to the storm drain and to maximize the 12 week allowable dewatering period, the dewatering system may ONLY be turned on once the excavation has encountered water or reached a depth within 2 feet of where groundwater is located based on the current monitoring well measurement at that time. The contractor is required to contact PW Inspection or WP Inspection prior to dewatering operation startup to unlock the settling tank discharge valve. Once the discharge valve is unlocked, the contractor must IMMEDIATELY obtain the dewatering permit from PW staff at the Development Center. If the dewatering permit is not immediately obtained on the same day the discharge valve is unlocked, PW will revoke the Excavation and Grading permit and daily administrative penalties may apply. H. STARTUP of dewatering operations is limited to Monday through Thursday ONLY. UPDATED: February 26, 2020 11 Dewatering may NOT start Friday through Sunday. I. Upon dewatering shutdown, the settling tank meter shall remain in place until City staff have recorded the final meter reading; PW or WP inspection should be contacted to record the meter reading. J. Verify the anticipated drawdown curve with a pump test performed on monitoring well(s) installed on the project site. Though the City is not currently requiring a particular type of pump test, the type used should be authorized and approved by a California licensed Hydrogeologist or CA licensed Geotechnical Engineer. Using the pump test and any other relevant data, the report shall state the anticipated pumping flow rate as well as the total amount of water due to be pumped for the 12 week dewatering period; daily pumped totals shall also be included. Following the two-week start-up period, the dewatering, pumping rates and maximum amount of water pumped on a daily basis shall be limited to the values calculated in the verification study. F. Project status reporting: During the construction period of the underground structure, the applicant must submit periodic reports and have the data available per request. Report contents and submittal frequency requirements are listed below. All status reports should be submitted via email to the Public Works Engineering staff who has been working on your project and who issued the Excavation and Grading permit. Questions should be directed to pwecips@CityofPaloAlto.org. 1) Monitoring well levels: At minimum, monitoring well data shall be collected daily for the first two weeks (start-up period) of the 12-week period and weekly thereafter. Status reports should be submitted weekly during start-up period and monthly thereafter. A final report shall be submitted two weeks after pumping ceases. 2) Flow meter readings: At minimum, flow meter data shall be collected daily for the first two weeks (start-up period) of the 12-week period and weekly thereafter. Status reports should be submitted weekly during start-up period and monthly thereafter. A final report shall be submitted two weeks after pumping ceases. 3) Survey data (see subsection IV.C. above): Once dewatering commences, survey data should be collected and reported weekly during the two-week start-up period and monthly thereafter. Note that the information will be made available to the public upon request. G. The Contractor and/or Applicant is required to contact PW Inspection to obtain the final meter readings once groundwater discharge has finished and prior to dismantling any dewatering system components. UPDATED: February 26, 2020 12 V. ADDITIONAL REQUIREMENTS FOR TEMPORARY CONSTRUCTION-RELATED GROUNDWATER DEWATERING IN GROUNDWATER (CONTAMINATED) PLUME AREAS Certain areas in the City have contaminated groundwater plumes due to previous land use. To determine if a site is in or nearby one of these areas, refer to the Attachment 5 figure. Dewatering sites in these areas must be carefully managed to ensure pumped groundwater does not enter the City’s storm drain system nor that it is used by members of the public without being treated. Therefore, Fill Stations are not required at these sites. However, the same flow meter/data logger requirements described in Section IV (B.i.) shall still be followed in order to account for the amount of groundwater pumped from the site. Construction of below ground structures in these areas triggers treatment requirements (in addition to sediment settlement) before discharging to the City’s storm drain system in order to protect the water quality of downstream creeks and the SF Bay. Because of site complexities, specific requirements may vary site by site. Therefore, for any site in or within 500 feet of the edge of a plume, contact the City’s Watershed Protection Group at (650) 329-2122 for guidance and requirements on sampling, treatment and disposal of temporary construction-related groundwater. Sampling groundwater for contaminants prior to initial discharge will be required, and potentially at intervals during dewatering. For all required sampling, the contractor must retain an independent testing firm to collect and process samples. Finally, the applicant should contact the Regional Water Quality Control Board (Water Board) to ensure additional state agency requirements are met. Note that compliance with the City does not imply compliance with the Water Board. Corporate Headquarters 1500 North Mantua Street P.O. Box 5193 Kent, OH 4240-5193 330-673-5685 Toll Free 1-800-828-8312 Fax: 330-673-0860 Western Region Office 6005 Capistrano Suite A Atascadero, CA 93422 Direct: 720-667-9236 barry.duncil@davey.com September 22nd, 2019 Gordana Pavlovic Gordana Design Studio, LLC 602 Hawthorne Ave. Palo Alto, CA 94301 650.483.4622 RE: Arborist Report and Tree Protection Plan for Potential Development Impacts at 2353 Webster St. in Palo Alto, California Dear Ms. Pavlovic, Thank you for contracting with Davey Resource Group regarding the above project. In support of your objectives, Davey Resource Group (DRG) is pleased to provide you with the attached report for the planned construction. A DRG International Society of Arboriculture (ISA) Certified Arborist conducted the site inspection of the trees that may be impacted by construction located at the above location in Palo Alto, California on February 3rd, as well as July 31st, 2019. The trees were assessed for location, size, current condition and overall health, as well as identifying critical and structural root zones to assist with tree protection plans. The attached report can be used to make informed decisions about demolition and construction planning, and long-term care of the trees. The survey determined the following: ▪ Twenty-one (21) trees within the potential impacts of the project scope were evaluated. ▪ Fourteen (14) species were identified with the most significant four (4) species listed as: valley oak (Quercus lobata), coast redwood (Sequoia sempervirens), ash (Fraxinus spp.) and southern magnolia (Magnolia grandiflora) ▪ Tree condition ratings ranged from 52% (Fair) to 75% (Good). ▪ It was determined that eighteen (18) trees will require some form of tree protection measures due to proposed site improvements. ▪ Two (2) trees are recommended for removal due to proposed site improvements. ▪ One (1) large valley oak will require extensive monitoring and specific procedures during demolition and construction Please feel free to contact me if you would like more information or have any questions. Sincerely, Emily Spillett Davey Resource Group Certified Arborist #WE-6702A 2353 Webster St., Palo Alto, CA 1 September 2019 ARBORIST REPORT AND TREE PROTECTION PLAN 2353 Webster St. Palo Alto, California August 2019 Revised September 2019 2353 Webster St., Palo Alto, CA 2 September 2019 Arborist Report & Tree Protection Plan for 2353 Webster St. Palo Alto, California Prepared for Gordana Pavlovic Gordana Design Studio, LLC 602 Hawthorne Ave. Palo Alto, CA 94301 August 2019 Revised September 2019 Prepared by Davey Resource Group A Division of The Davey Tree Expert Company 1500 North Mantua Street Kent, OH 44240 Contact: Ruth Williams Western Region Office 6005 Capistrano Suite A Atascadero, CA 93422 Phone: 503.880.3818 E-mail: ruth.williams@davey.com www.daveyresourcegroup.com Notice of Disclaimer Inventory data provided by Davey Resource Group is based on visual recording at the time of inspection. Visual records do not include testing or analysis and do not include aerial or subterranean inspection. Davey Resource Group is not responsible for discovery or identification of hidden or otherwise non-observable risks. Records may not remain accurate after inspection due to variable deterioration of inventoried material and site disturbance. Davey Resource Group provides no warranty with respect to the fitness of the urban forest for any use or purpose whatsoever or for future outcomes of the inventoried trees. 2353 Webster St., Palo Alto, CA 3 September 2019 Table of Contents Summary 4 Introduction 4 Background 4 Assignment 4 Limits of Assignment 5 Purpose and Use of Report 5 Observations 5 Methods 5 Site Observations 5 Tree Observations 5 Analysis and Discussion 5 Conclusion and Recommendations 6 Appendix A – Tree Photograph Summary 8 Appendix B – Tree Inventory and Condition Assessment 11 Appendix C - Tree Protection Plan Drawing 13 2353 Webster St., Palo Alto, CA 4 September 2019 Summary In August 2017, Davey Resource Group (DRG) was contracted by Gordana Pavlovic to explore the possibility of having a new home on the site, address concerns about the impacts the project might have on the trees in proximity and define an area on the lot where the new construction would be possible at 2353 Webster St. in Palo Alto, CA, and what the condition of the trees are in before any design or construction began. In February 2019, DRG was again contracted by Ms. Pavlovic with a revised design as requested by the Planning department, to update the tree assessment and develop a tree protection plan for the existing trees. The revised design shifted the proposed building further away from a large oak to further protect this tree during and after construction. In the meantime, Jason Shirar, Arborist from S.P. McClenahan Co has been retained by Gordana to care and maintain the trees on the property. An International Society of Arboriculture (ISA) Certified Arborist (#WE-9234A) from DRG conducted the evaluation of twenty-one (21) trees that may be impacted by development on February 3rd, 2018. After receiving comments from the City of Palo Alto, DRG sent another arborist to the site to collect additional information about the trees and neighboring trees. The initial assessment did not note a neighboring Deodar Cedar and as there was some concern expressed by comment from a neighbor, on September 22, 2019, the neighboring Deodar Cedar was added to the assessment. The trees were assessed by their location, size, current condition, and overall health. The current site survey was used to plot the critical root zones (CRZ) of the trees to help guide construction options to reduce potential impacts on the trees. Tree condition was primarily fair (6 trees), while fourteen (14) trees were in good condition. It was determined that two (2) of the trees are recommended for removal due to site improvements, and fifteen (15) trees are recommended for varying degrees of tree protection measures as described in this report as well as the Tree Protection Plan. Tree #5 is a large oak that will require monitoring, specific demolition practices, and fencing during and after demolition to best determine the retention potential of this tree. Typical tree protection fence will include Type I and Type II as found in the Palo Alto Tree Technical Manual. Introduction Background Yali Zhou is planning construction at 2353 Webster St. in Palo Alto, CA. In 2017, DRG was contracted to address concerns about the impacts the project might have on the trees in proximity to development and what the condition of the trees are in before any construction began. Gordana Pavlovic requested that DRG provide feedback regarding a proposed residential design at 2353 Webster St., and how that design may be changed or updated to reflect less impact to a large oak specimen. In 2019, Ms. Pavlovic had designed a new building plan in response to DRG’s recommendations to create a larger Tree Protection Zone for the specimen tree. In February 2019, DRG was again contracted to assess the existing trees and provide Tree Protection Plans for the new proposed residence at 2353 Webster. It was requested on behalf of the homeowners that DRG provide an arborist report on the health of the trees, and to identify what tree protection measures may be needed before final plans are submitted to Palo Alto for approval of the new project. Assignment DRG was contracted to conduct a site evaluation of twenty-one (21) existing trees within the limits of the project scope at 2353 Webster St. in Palo Alto, CA and recommend any necessary tree protection measures for the identified trees. The survey included a visual assessment of the trees’ condition, observations of the site conditions and estimating the current critical root zones to assist with upcoming construction planning. 2353 Webster St., Palo Alto, CA 5 September 2019 Limits of Assignment Many factors can limit specific and accurate data when performing evaluations of trees, their conditions, and potential for failure or response to site disturbances. No soil or tissue testing was performed. All observations were made from the ground and no soil excavation to expose roots was performed. The most recent development plans were available to assist in determining potential construction impacts, but these did not include detailed demolition plans. The determinations and recommendations presented here are based on current data and conditions that existed at the time of the evaluation and cannot be a predictor of the ultimate outcome for the evaluated trees in the future. Purpose and Use of Report The purpose of this report is to provide a summary of the evaluations of the trees located at 2353 Webster St., including an assessment of the current condition and health, as well as providing a tree protection plan for all evaluated trees that may be impacted by construction plans. The findings in this report can be used to make informed decisions on design planning and be used to guide long-term care of the trees. This report and detailed tree protection plan can also be submitted to Palo Alto for permitting purposes. Should the development plans be revised, this report and plan must also be revised to remain valid. Observations Methods Only a visual inspection was used to develop the findings, conclusions, and recommendations found in this report. Data collection included measuring the diameter of significant trees at approximately 54 inches above grade (DBH), height estimation, canopy radius estimation, a visual assessment of tree condition, structure, and health, and a photographic record. Numerical values were assigned to grade the attributes of the roots, trunk, branches, and foliage, including structure and health, and to obtain an overall condition rating. No physical inspection of the upper canopy, sounding, root crown excavation, resistance drilling, or other technologies were used in the evaluation of the trees. Site Observations The surveyed site is a residence on a relatively flat location in Palo Alto, CA. Most of the grounds are landscaped. Tree Observations Twenty-one (21) trees were evaluated as part of this report. Four (4) important species were identified: valley oak (Quercus lobata), coast redwood (Sequoia sempervirens), ash (Fraxinus spp.) and southern magnolia (Magnolia grandiflora). Visual assessments determined tree condition ratings ranged from 52-58% (Fair, 6 trees) to 75% (Good, 14 trees). Tree diameters ranged from 8 to 72 inches. Finally, tree heights were estimated to be approximately 14 to 60 feet. Tree photographs are available upon request and a complete Tree Inventory and Condition Assessment can be found in Appendix A. Analysis and Discussion The surveyed trees are of a mixed size (age) class. Seven (7) trees are on the property under construction, while ten (10) trees are on adjacent property and four (4) are street trees. Lower tree condition ratings were based on trunk structure or damage, visible decay, minor dieback, poor structure, or observed stress. Tree #5 is an older tree that be considered mature and is located very close to the existing house. It is likely that many of the tree roots grow along the house and at the base of the of the existing footers, and this should be noted for the demolition phase. 2353 Webster St., Palo Alto, CA 6 September 2019 The diameters of the surveyed trees were used to illustrate the potential critical root zone (CRZ) of each tree. The CRZ is the area of soil around a tree where the minimum amount of roots considered critical to the health of the tree are located. The CRZ was calculated by multiplying the DBH by 0.83 feet (10 inches). For instance, tree #1 has a DBH of 12 inches and a calculated CRZ of 10 feet (12 x 0.83). This distance may extend beyond the tree canopy dripline and is normally considered the tree protection zone (TPZ). Tree protection fencing is normally installed to protect the CRZ, but at a minimum should be installed at the dripline. Like the CRZ, the structural root zone (SRZ) was also calculated using a commonly accepted method established by Dr. Kim Coder in Construction Damage Assessments: Trees and Sites.1 In this method, the root plate size (i.e. pedestal roots, zone of rapid taper area, and roots under compression) and limit of disruption based upon tree DBH is considered as a minimum distance that any disruption should occur during construction. Significant risk of catastrophic tree failure exists if structural roots within this given radius are destroyed or severely damaged. The SRZ is the area minimal or no disturbance should occur without arborist supervision. Both the CRZ and SRZ for the surveyed trees are illustrated in Appendix C. Conclusion and Recommendations Tree #5 will require extensive planning, additional budget and thorough communication with supervising arborist and the contractor. As the structural root zone may be impacted during demolition, it is critical that all demolition techniques minimize impacts in this area. Currently, the CRZ for this tree is estimated at approximately 11,000 square feet. Based on the proposed demolition that will occur, we estimate that 1850 square feet (17% percent) of this CRZ will be removed. Minor impact to the remaining CRZ area is anticipated from proposed demolition, restoration and utility connections. It is recommended that existing structure demolition is completed by hand from within the building footprint. No Equipment outside the footprint and an arborist should approve the equipment inside the footprint. All demolition and restoration work within the CRZs of retained trees shall be completed by hand and under arborist supervision. Existing soil moisture should be mimicked throughout demolition and construction. Subsequent protection measures should be considered through all stages of demolition and construction. This may include: tree growth regulator (tree #5); root protection matting and 4-6” inches of mulch; installing trunk wrap; using hand tools and light machinery when working in the Tree Protection Zone; watering, wetting and covering roots that may be exposed to sunlight and dry conditions; potentially leaving some parts of the foundation and existing footings in place as to minimally disturb existing roots. Additionally, all fill soils around tree #5 shall mimic existing native soils and shall not be over-compacted, as determined by a soil specialist. To facilitate the demolition of the existing building foundation, the tree protection should be temporarily moved to the outside of the demolition area once the Arborist has arrived onsite to document any tree impacts. Root protection matting and mulch may be necessary to minimize soil compaction and impacts to the existing roots within the Tree Protection Zone, as determined by the supervising arborist. When demolition is complete, soil should be immediately backfilled and incorporated with the native soils using pneumatic air tools, and finally the area should be mulched. Then the tree protection fence should be replaced and remain throughout the duration of construction. All work performed in the TPZ of the trees to be retained should be supervised by a Certified Arborist. Temporary root protection is recommended by using a 4-6” layer of mulch. In addition, the proposed electric 1 Dr. Kim D. Coder, University of Georgia July 1996 2353 Webster St., Palo Alto, CA 7 September 2019 utility connection through the TPZ must be excavated by air tools or by hand, or be directional bored, to avoid unnecessary root damage. The utility work will require arborist oversight. Tree protection measures should be in place before any site work occurs, including: ● Installation of 6’ min high tree protection fencing ● Mulching according to the tree protection plans ● Posting signage on the tree protection fencing ● Pre-work meetings and site visits with the design team ● Ensuring that contractor and subcontractors know when arborist supervision is required This helps to ensure that everyone is on-board towards the same goal- retaining and preserving the twenty- one (21) trees while maintaining a safe residential setting. Following construction, the trees should be monitored monthly by a Certified Arborist to ensure the condition and structure of the tree do not decline over time or become hazardous. If a change in state is observed, the Arborist should recommend mitigation measures, which may include, but are not limited to, increased monitoring, pruning, general plant health care, or removal. 2353 Webster St., Palo Alto, CA 8 September 2019 Appendix A – Tree Photograph Summary Additional photos upon request Image 1. Trees #1-3 along Webster St. 2353 Webster St., Palo Alto, CA 9 September 2019 Image 2. Tree #5 behind house 2353 Webster St., Palo Alto, CA 10 September 2019 Image 3. Tree #5 2353 Webster St., Palo Alto, CA 11 September 2019 Image 4. Tree #5 2353 Webster St., Palo Alto, CA 12 September 2019 Appendix B – Tree Inventory and Condition Assessment Attached 2353 Webster St., Palo Alto, CA 13 September 2019 Appendix C - Tree Protection Plan Drawing Attached Wetland 5300 Wellington Branch Drive • Suite 100 Gainesville, Virginia 20155 Phone: 703-679-5600 • Fax: 703-679-5601 www.wetlandstudies.com Studies and Solutions, Inc.R Ci t y o f P a l o A l t o Tr e e P r o t e c t i o n - I t ’ s P a r t o f t h e P l a n ! Ma k e s u r e y o u r c r e w s a n d s u b s d o t h e j o b r i g h t ! T- 2 Sp e c i a l T r e e P r o t e c t i o n I n s t r u c t i o n S h e e t Ci t y o f P a l o A l t o Al l o t h e r t r e e - r e l a t e d r e p o r t s s h a l l b e a d d e d t o t h e s p a c e p r o v i d e d o n t h i s s h e e t ( a d d i n g a s n e e d e d ) In c l u d e t h i s s h e e t ( s ) o n P r o j e c t S h e e t I n d e x o r L e g e n d P a g e . A c o p y o f T - 1 c a n b e d o w n l o a d e d a t w w w . c i t y o f p a l o a l t o . o r g / a r b / f o r m s ZHOU RESIDENCE 2353 WEBSTER ST PALO ALTO, CALIFORNIA WSSI PROJECT # DRGWEST234 T- 2   Wetland 5300 Wellington Branch Drive • Suite 100 Gainesville, Virginia 20155 Phone: 703-679-5600 • Fax: 703-679-5601 www.wetlandstudies.com Studies and Solutions, Inc.R T- 3 Sp e c i a l T r e e P r o t e c t i o n I n s t r u c t i o n S h e e t Ci t y o f P a l o A l t o Al l o t h e r t r e e - r e l a t e d r e p o r t s s h a l l b e a d d e d t o t h e s p a c e p r o v i d e d o n t h i s s h e e t ( a d d i n g a s n e e d e d ) In c l u d e t h i s s h e e t ( s ) o n P r o j e c t S h e e t I n d e x o r L e g e n d P a g e . A c o p y o f T - 1 c a n b e d o w n l o a d e d a t w w w . c i t y o f p a l o a l t o . o r g / a r b / f o r m s ZHOU RESIDENCE 2353 WEBSTER ST PALO ALTO, CALIFORNIA WSSI PROJECT # DRGWEST234 T- 3   Wetland 5300 Wellington Branch Drive • Suite 100 Gainesville, Virginia 20155 Phone: 703-679-5600 • Fax: 703-679-5601 www.wetlandstudies.com Studies and Solutions, Inc.R T- 4 Sp e c i a l T r e e P r o t e c t i o n I n s t r u c t i o n S h e e t Ci t y o f P a l o A l t o Al l o t h e r t r e e - r e l a t e d r e p o r t s s h a l l b e a d d e d t o t h e s p a c e p r o v i d e d o n t h i s s h e e t ( a d d i n g a s n e e d e d ) In c l u d e t h i s s h e e t ( s ) o n P r o j e c t S h e e t I n d e x o r L e g e n d P a g e . A c o p y o f T - 1 c a n b e d o w n l o a d e d a t w w w . c i t y o f p a l o a l t o . o r g / a r b / f o r m s ZHOU RESIDENCE 2353 WEBSTER ST PALO ALTO, CALIFORNIA WSSI PROJECT # DRGWEST234 T- 4   Attachment F Project Plans During Shelter-in-Place, plans are only available online. Directions to review Project plans online: 1. Go to: https://paloalto.buildingeye.com/planning 2. Search for “2353 Webster Street” and open record by clicking on the green dot 3. Review the record details on the left side and open the “more details” option 4. Use the “Records Info” drop down menu and select “Attachments” 5. Open the attachment named “2353 Webster Approved Plans” and dated 12/05/19 to review the tentatively approved plan set. City of Palo Alto (ID # 11469) City Council Staff Report Report Type: Action Items Meeting Date: 8/17/2020 City of Palo Alto Page 1 Council Priority: Climate/Sustainability and Climate Action Plan Summary Title: Carbon Neutral Plan Updates Title: Staff and Utilities Advisory Commission Recommend the City Council Adopt a Resolution Amending the City's Electric Supply Portfolio Carbon Neutral Plan and Electric Utility Reserves Management Practices From: City Manager Lead Department: Utilities Recommendation Staff and the Utilities Advisory Commission (UAC) recommend that the City Council: 1) Adopt a resolution (Attachment A) amending the Carbon Neutral Plan (as shown in Exhibit A to Attachment A) to: a. Modify the definition of carbon neutrality to use an hourly carbon emissions accounting standard; b. Minimize electric supply portfolio costs by authorizing the exchange of bundled RECs from the City’s long-term renewable resources (Bucket 1 RECs) for Renewable Portfolio Standard (RPS) eligible, unbundled RECs (Bucket 3 RECs),1 to the maximum extent possible, while maintaining compliance with the state’s RPS regulations (“REC Exchanges”); c. For calendar years 2020 through 2024, authorize the purchase of RPS-eligible, unbundled RECs (Bucket 3 RECs) as needed to neutralize any residual emissions resulting from the difference between emissions calculated under an annual accounting and hourly accounting methodology; 2) Direct staff to return to Council in 2022 to review the authorization to minimize electric supply portfolio costs via REC Exchanges; 3) Direct staff to return to Council with a review of the Carbon Neutral Plan by the end of 2024 to evaluate the effectiveness of these policy changes and to modify them if necessary (with 1 See Attachment C for a description of different types of RECs. City of Palo Alto Page 2 a particular focus on reviewing the use of Bucket 3 RECs to neutralize any residual emissions resulting from the switch to an hourly emissions accounting methodology); and 4) Create a Cap and Trade Program Reserve in the Electric Fund which will hold revenues from the sale of carbon allowances freely allocated to the electric utility under the State’s Cap and Trade Program. (See Attachment B for background information on the State’s Cap and Trade Program.) Staff and the UAC recommend that the Council provide the following guidance on the use of revenues: Consistent with the City’s Cap and Trade Revenue Use Policy, adopted in January 2015, for Fiscal Years 2021 and 2022, an amount equivalent to at least one-third of the revenues earned from the REC Exchanges would be allocated from the City’s Cap and Trade Reserve to local decarbonization efforts; thereafter the City would prioritize local decarbonization efforts with these funds. This action, which would require only City Manager approval, will have little to no impact on rates due to the amendments to the Carbon Neutral Plan described above (specifically, the REC Exchanges). Executive Summary This report is a follow-up to a series of reports to the UAC covering the topics of carbon emissions accounting and Renewable Portfolio Standard (RPS) procurement strategy (e.g., reports from May 2019, June 2019, August 2019, February 2020, March 2020 and July 2020). The two topics are not only highly complex and esoteric, but also highly interrelated. Further, policy decisions related to these two topics can have potentially significant impacts on supply costs, retail rates, and funding for customer programs. As a result, staff, the UAC, and a number of community members have had extensive discussions about these topics in an attempt to arrive at a policy position that balances the City’s sustainability goals with its desire to lower costs and rates. The attached amendments to the Electric Supply Portfolio Carbon Neutral Plan will: 1. Change the City’s methodology for accounting for the carbon emissions of its electric portfolio from an annual methodology to a more accurate hourly methodology. This will result in a small increase in the cost of the electric portfolio to maintain carbon neutrality under the hourly standard. However, this cost will be minimized in the near term because the amendments also allow the use of Bucket 3 RECs through 2024 for any additional renewable energy purchases needed due to the change in methodology. The policy of using Bucket 3 RECs for this compliance requirement will be revisited prior to 2024, which is the timeline for completing an electric portfolio rebalancing analysis in anticipation of the end of the City’s Western Base Resource contract for Federal hydropower from the Central Valley Project. This topic is summarized in previous UAC reports and Attachment C. City of Palo Alto Page 3 2. Allow for REC Exchanges2 to take advantage of the current significant cost difference between Bucket 1 and Bucket 3 RECs to generate earnings for the City’s electric utility. These REC Exchanges are authorized going forward without a specific end date, but a review of the policy is required prior to 2024. The earnings would be used either to offset electric utility operational costs or they would be reserved for local decarbonization. This topic is the primary focus of this report. During the course of the UAC discussions, the Palo Alto community experienced a truly fundamental shift in everyday life—as well as in the City’s financial outlook—due to the COVID- 19 pandemic. The measures put in place throughout the state to contain the spread of the novel coronavirus have had a profound negative impact on the City’s General Fund; they have also led to a reduction in the electric utility’s total sales, which is projected to cause a multi- million dollar revenue shortfall over the next few years. As a result, at the UAC’s May 2020 discussion of the Utility’s FY 2021 budget, the UAC voted unanimously to pursue maximizing the total volume of exchanges of in-state (Bucket 1) renewables for out-of-state (Bucket 3) renewables. In previous discussions prior to the COVID-19 pandemic Commissioners had expressed an interest in having all of these funds go toward local decarbonization, but given the economic impacts of the pandemic recognized the value of devoting some portion of these earnings to help avoid painful cuts to electric utility programs, positions, and capital investments, minimize retail rate increases. Subsequently, at the July 2020 UAC meeting, the Commission voted unanimously to recommend the proposal presented in the current report, to exchange the City’s Bucket 1 renewable resources for Bucket 3 renewables to the maximum extent permitted under the state’s RPS law, while maintaining carbon neutrality. Staff and the UAC do not recommend establishing a specific sunset date for the authority for these maximized renewable energy exchanges; however, they recommend that staff be directed to return to Council after two years (in 2022) to review the effects of this policy change and consider whether to extend or modify it. In addition, staff and the UAC recommend re- evaluating the effectiveness of the change to the City’s carbon accounting methodology before calendar year 2024—which will be at the time the City considers whether to renew its share of the Western Base Resource hydroelectric project or rebalance its portfolio. If the City enables the REC exchanges described above, it has an opportunity to reduce electric supply costs by over $3 million per year and therefore redirect some additional funding to local carbon reduction activities (like building electrification) without significantly impacting utility rates. This action could be undertaken by action of the City Manager under existing Council authority. At the July 2020 meeting, the UAC expressed a clear preference that the revenue from these REC exchanges be allocated to local carbon reduction efforts; however, in view of the budget impacts of the COVID-19 pandemic, the UAC recommended that for Fiscal Years 2021 and 2022 at least one-third of the revenue from the REC exchanges be devoted to local decarbonization, with the majority of the funding being used to ameliorate the pandemic 2 The exchange of bundled RECs from the City’s in-state, long-term renewable resources (Bucket 1 RECs) for RPS- eligible, unbundled RECs (Bucket 3 RECs), which usually come from out of state sources. City of Palo Alto Page 4 budget impacts on the electric utility, but that local decarbonization be prioritized in future years. Discussion Since the start of the coronavirus pandemic, electricity consumption in Palo Alto has fallen about 10% from baseline levels; given this reduction in retail sales volumes and the desire to help the community by holding rates flat, the utility now faces a multi-million-dollar budget gap. As such, there is broad community interest in three different objectives with respect to the electric utility: (a) closing the utility’s revenue gap, (b) holding retail rates flat, and (c) maintaining the City’s commitment to carbon neutral supply resources. Executing exchanges of the City’s in-state/Bucket 1 renewable energy generation for out-of-state/Bucket 3 renewable generation is one potential way for the City to efficiently satisfy all three objectives simultaneously. The focus of the current report is therefore the potential revenue that can be gained through exchanging the City’s in-state renewable resources (“Bucket 1 RECs”) for out-of- state renewables (“Bucket 3 RECs” or “unbundled RECs”) and the impacts that such exchanges would have on the make-up of the City’s electric supply portfolio. Additional background information about the City’s Carbon Neutral Plan, the differences between hourly and annual carbon accounting methodologies, and the qualitative differences between California-based Bucket 1 renewables and out-of-state unbundled RECs (both of which were discussed at length in the March 2020 UAC report and presentation) can be found in Attachment C. REC Exchange Revenue Potential The ability to raise new revenue by exchanging in-state for out-of-state renewable generation is based on the fact that, due to legislative constraints on the ability to use out-of-state renewable generation to comply with the state’s RPS requirements, in-state generation carries a large price premium relative to out-of-state generation. Currently, in-state renewable generation is valued at about $15 per MWh (in addition to the value of the electrical energy itself), while out-of-state renewable generation is valued at only $2.75 per MWh. Estimates of the revenue potential of the proposed REC exchanges is based on these current REC values, the City’s current load projections (which incorporate a reduction associated with the impact of the COVID-19 pandemic), and the City’s current hydroelectric generation projections. Table 1 below summarizes the estimated net revenue potential associated with this REC exchange proposal over the next five fiscal years. Table 1: Summary of REC Exchange Revenue Potential, FY 2021-2025 ($M) FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 Sales of Bucket 1 RECs Exceeding Annual Load $0.56 $0.79 $1.78 $2.48 $2.55 Additional Bucket 1 REC Sales $3.41 $2.49 $1.36 $0.95 $0.59 Bucket 3 REC Purchases Cost ($0.63) ($0.46) ($0.25) ($0.17) ($0.11) Net Revenue Potential $3.34 $2.82 $2.89 $3.25 $3.03 City of Palo Alto Page 5 Note that the figures in the table above assume that the City begins the REC exchanges in September of FY 2021. It is worth noting that the revenue potential estimates are highly sensitive to the generation volumes the City receives from its hydro resources, which of course are highly uncertain. If hydro conditions were above-average for the winter of 2020/2021, the total REC exchange revenue for the next two fiscal years would be expected to increase from $6.2 million to $7.7 million, while in below-average hydro conditions the total revenue would fall to $5.7 million. Impact of REC Exchanges on Electric Supply Portfolio Although exchanging in-state RECs for out-of-state RECs would have no real impact on the City’s total electricity-related carbon emissions (see Attachment C for more discussion on this topic), the downside of this strategy is that it would have a negative impact on the City’s reported portfolio make-up and carbon emissions. As noted earlier, the state’s RPS law gives preferential treatment to in-state renewable resources over out-of-state resources, and the same is true of how such resources are reported to customers on the annual Power Content Label (PCL). As of calendar year 2020, the California Energy Commission’s (CEC’s) PCL regulations require that utilities report their out-of-state (Bucket 3) REC purchases as “unspecified sources of power” rather than under the appropriate renewable energy technology. Furthermore, beginning with the 2020 PCL, utilities will be required to report the annual average greenhouse gas emissions intensity of their electric supply. And again, rather than being treated as carbon-free resources like other forms of renewable energy, Bucket 3 RECs will be treated as having an emissions intensity equivalent to generic market power purchases (428 kilograms (kg) of CO2 per MWh, which is almost 20% greater than the emissions intensity of natural gas generation). As a result, rather than reporting a supply mix that is over 60% renewable and nearly carbon- free on average3, under the maximized REC exchange strategy the City will have to report a portfolio mix that is less than 40% renewable and is responsible for a moderate amount of carbon emissions. Table 2 displays the Power Content Label, RPS level, and emissions intensity for the City’s electric supply portfolio in CY 2021 (the only full calendar year covered by the proposed period of authority for maximizing the REC exchanges). It will no doubt be a communications challenge to explain to customers that the “unspecified sources of power” on their PCL actually represent out-of-state renewable resources, and that while the PCL indicates that their power supply is responsible for about 100 kg of CO2 emissions per MWh (which is still well below the statewide average emissions intensity of 240 kg CO2 per MWh) by the City’s accounting it is actually carbon neutral. Still, staff feels that this challenge is worth it for the sake of the several million dollars of additional revenue that this strategy will bring in, which can be used to defray the economic impacts of COVID-19 and to fund additional local carbon reduction. 3 Although the City’s baseline portfolio mix is entirely comprised of renewables and hydroelectric resources, the CEC’s proposed PCL regulations assign a small emission intensity to all biomass generation such as landfill gas generation, which currently accounts for about 10% of the City’s supply mix. City of Palo Alto Page 6 Table 2: Power Content Label, RPS Level, and Emissions Intensity for the City’s Electric Supply Portfolio in CY 2021 (Baseline and Maximized REC Exchanges) Use of REC Exchange Revenues In the August 2019 UAC presentation on this topic, staff presented a list of potential uses of the revenue from the sale of surplus renewable resources. (As referenced in Table 1 outlines, the net revenue from these sales could be up to $3.06 million per year, on average, over the FY 2021-2025 time period.) That list of potential uses included: •Rate reduction •Decarbonization efforts (e.g., building electrification or electric vehicle charging infrastructure or incentives) •Investments in smart grid infrastructure •A second transmission line connecting the City’s distribution system to the bulk transmission system In discussions with the UAC and the community prior to the pandemic, the focus for the use of this new revenue stream was largely on the first two items: rate reduction and local decarbonization. Since the beginning of the pandemic the focus of these discussions, for the near-term, has been on how to avoid deep cuts to the electric utility budget while avoiding rate increases. Existing Portfolio Maximizing REC Exchanges Eligible Renewables 60% 31% Biomass & Biowaste 12% 7% Geothermal 0% 0% Small hydroelectric 1% 1% Solar 37% 18% Wind 10% 6% Coal 0% 0% Large Hydroelectric 40% 46% Natural Gas 0% 0% Nuclear 0% 0% Other 0% 0% Unspecified Sources of Power 0% 23% RPS Level (% of sales) 62% 36% Emissions Intensity (kg CO2/MWh) 6 102 City of Palo Alto Page 7 Given the current financial environment caused by the pandemic, staff and the UAC recommend that the majority of the proceeds from the recommended REC exchanges over the next two years be devoted to closing the electric utility’s budget gap and avoiding cuts to programs, staffing levels, or capital investments. However, given the City’s ambitious Sustainability Implementation Plan goals related to Energy and Electric Vehicles, staff and the UAC recommend that even in the near-term at least one-third of the REC exchange revenues be devoted to local decarbonization programs. And after the pandemic’s effects pass, staff and the UAC recommend that the revenue from the REC exchanges be reallocated, with an even stronger focus on local carbon reduction efforts. Mechanism for Allocation of Funds to Local Decarbonization Currently the electric utility’s renewable energy purchases are funded from two sources: 1) customer sales revenues, and 2) revenues the electric utility receives as a result of its participation in the State’s Cap and Trade program (see Attachment B for more detail). Table 3 shows the current funding levels from these two sources and how staff and the UAC propose to change funding levels if the REC Exchange proposal is implemented: Table 3: Funding Sources for FY 2021 / FY 2022 Renewable Energy Budget ($M) FY 2021 Budget without REC Exchanges FY 2021 Budget with REC Exchanges FY 2022 Budget without REC Exchanges FY 2022 Budget with REC Exchanges Cap and Trade Revenue $5.3 $4.2 $5.3 $4.4 Customer Sales Revenue $30.7 $28.4 $30.7 $28.8 Total Renewable Energy Budget $36.0 $32.7 $36.0 $33.2 REC Exchange Revenue $3.3 $2.8 Cap and Trade Revenue Reserved for Local Decarbonization (33% of REC Surplus Sales and Exchange earnings) $1.1 $0.9 Savings to Electric Utility $2.2 $1.9 The revenues received from the REC Exchanges would go into the Electric Supply Reserve, reducing operating costs. However, staff recommends allocating a portion of the revenues earned from the City’s participation in the state’s Cap and Trade Program (equal to one-third of the REC Exchange revenue) to local decarbonization activities, because Cap and Trade Program revenues are provided to the electric utility explicitly to support carbon reducing activities like local decarbonization. For ease of accounting and fund tracking, staff recommends the creation of a Cap and Trade Program Reserve in the Electric Fund which will hold revenues from the sale of carbon allowances freely allocated by the California Air Resources Board to the City’s electric City of Palo Alto Page 8 utility. See Attachment D for an updated version of the Electric Utility Reserves Management Practices reflecting the creation of this reserve. The Council’s January 2015 policy on the use of these revenues gives the City Manager authority to allocate these funds among a range of purposes, including local carbon reduction, so no further Council action would be required except to approve specific local decarbonization program budgets through the annual budget process. Ultimately, the ability to make a significant investment in jumpstarting local decarbonization efforts without raising retail rates by one cent—in fact, while actually helping to lower retail rates—seems like a proposal that should win broad support. Policy Alternatives An alternative compromise approach to the use of the sales revenue from the sales and exchanges of the City’s renewable energy supplies would be to allocate a fixed amount toward local decarbonization efforts (e.g., $1 million per year) and the remainder to operational savings and rate reduction. Additional alternatives to this proposal could include allocating more of the revenue from this proposal to rate reduction or allocating more to local carbon reduction. Other alternatives could include establishing an explicit time limit on the authorization for the REC exchanges. Next Steps Immediately upon the approval of the Carbon Neutral Plan amendments, staff will begin to execute transactions to sell the City’s in-state renewable resources and purchase out-of-state renewables. In addition, staff will report on the portfolio’s total emissions under both an hourly and an annual carbon accounting framework in the annual report to the City Council on the City’s Renewable Procurement Plan, Renewable Portfolio Standard Compliance, and Carbon Neutral Electric Supplies (expected in Q4 of 2020). In addition, in the next couple of years staff plans to carry out a broader and longer-term analysis of potential options for rebalancing the City’s electric supply portfolio. This analysis will be presented in the context of deciding whether to renew the City’s Western Base Resource hydro contract after the current one expires at the end of 2024. It will also consider options for utilizing the City’s share of the California-Oregon Transmission Project, after that resource reverts to the City’s control at the end of 2023. Resource Impact Staff estimates that exchanging the City’s in-state renewable resources (“Bucket 1 RECs”) for out-of-state renewables (“Bucket 3 RECs”) will generate an average of approximately $3.1 million in additional revenue per year for the next five fiscal years. In addition, staff estimates that switching to an hourly carbon accounting methodology, using average hourly emissions intensity factors, and using Bucket 3 RECs to neutralize the residual emissions resulting from this change, will result in an increase in supply costs of approximately $140,000 in an average hydrological year. So overall, staff’s and the UAC’s proposal is expected to yield $3.0 million in City of Palo Alto Page 9 new net revenue per year for the next five years on average. (Staff will review and adjust the budget when these additional revenues need to be recognized. Currently these are estimates only and don’t need to be recognized, so a budget adjustment isn’t needed at this time.) Staff and the UAC recommend allocating at least one-third of these earnings toward local decarbonization efforts for the next two years, and the remainder to rate reduction. Beyond the next two years, staff and the UAC recommend allocating the majority of these earnings to local decarbonization efforts. This approach would yield operational savings that could reduce future rate increases by approximately 0.7%, or 0.12 cents/kWh, while also providing substantial funding for local carbon reduction. Policy Implications This report satisfies Initiatives #4 and #5 of the EIRP Work Plan. This report is also in line with the Sustainability and Climate Action Plan goals of continuing to lower the carbon footprint of the community. Stakeholder Engagement The changes proposed in this staff report have been the subject of significant discussion with the UAC and the public over the past year. In addition to several discussions on this topic at the UAC during this period, staff has also met with, and incorporated feedback from, several engaged members of the community. Environmental Review The City Council’s amendment of the City’s Carbon Neutral Plan and Electric Utility Reserves Management Practices does not meet the definition of a project under Public Resources Code 21065 and therefore California Environmental Quality Act (CEQA) review is not required. Attachments: • Attachment A: Resolution Amending Carbon Neutral Plan • Attachment B: Cap and Trade Program Synopsis • Attachment C: Background Information on Carbon Neutral Plan, Carbon Accounting & RECs • Attachment D: Updated Electric Reserve Management Practices Attachment A 1 Resolution No. _____ Resolution of the Council of the City of Palo Alto Amending the Electric Supply Portfolio Carbon Neutral Plan and the Electric Utility Reserves Management Practices R E C I T A L S A.The City of Palo Alto (the “City") provides electricity to residential and commercial customers located within its jurisdictional boundary. B.In an effort to combat climate change, in December 2007 the City adopted the Climate Protection Plan, which set aggressive greenhouse gas (“GHG”) emission reduction goals to be achieved by the year 2020. C.Further to its GHG emissions reduction goals, in November 2016 the City adopted a Sustainability and Climate Action Plan (“S/CAP”), and in December 2017 the City adopted a 2018-2020 Sustainability Implementation Plan (“SIP”). D.In order to achieve these aggressive GHG emissions reduction goals, in March 2013, through Resolution No. 9322, the City adopted a Carbon Neutral Plan for the electric supply portfolio, with a goal of achieving carbon neutrality by 2013. E.In the 2013 Carbon Neutral Plan, the City defined carbon neutrality based on an annual accounting of the City’s load and its carbon neutral electric resources: an electric supply portfolio that “will demonstrate annual net zero greenhouse gas (GHG) emissions, measured at the Citygate, in accordance with The Climate Registry’s Electric Power Sector protocol for GHG emissions measurement and reporting.” At the time this definition of carbon neutrality was adopted, this was the most granular accounting approach feasible (given the lack of hourly grid emissions data) or necessary (given the small amount of solar capacity installed at that point, and the resulting emissions profile of grid electricity). F.Based on this definition of carbon neutrality, the City has achieved its Carbon Neutral Plan objectives each year starting in 2013, primarily through its long-term contracts for in-state hydroelectric and Renewable Portfolio Standard (“RPS”) eligible resources, with some reliance on RPS-eligible unbundled renewable energy certificates (“RECs”) for 2013-2015. G.Due to limitations on the use of unbundled RECs (“Bucket 3 RECs”) for compliance with the state’s RPS mandate (only 10% of a utility’s RPS procurement may consist of Bucket 3 RECs), a significant financial premium currently exists for in-state bundled renewable energy resources (“Bucket 1 RECs”). H.As a result of its pursuit of its Carbon Neutral Plan objectives, the City’s electric supply portfolio currently far exceeds the procurement requirements of the state’s RPS Attachment A 2 mandate, and all of the City’s current RPS resources are classified as Bucket 1 RECs. I.Due to the impacts of the county and state stay-at-home orders put in place since March 2020, in response to the COVID-19 pandemic, the City’s electric utility retail sales volumes (and revenues) have declined approximately 10% from baseline levels, which has put a strain on the City’s electric utility financial reserves. J.Through Resolution 9487, adopted in January 2015, the City established a policy on the use of revenue from the sale of allowances freely allocated to the City’s electric utility under the state’s Cap and Trade Program (“Cap and Trade Revenue Use Policy”). This policy authorizes the City Manager or their designee to use these allowances and allocate the resulting revenue to certain approved types projects or expenditures, in compliance with CARB regulations. K.Consistent with the City’s Cap and Trade Revenue Use Policy, for Fiscal Years 2021 and 2022, an amount equivalent to at least one-third of the revenues earned from the REC Exchanges would be allocated from the City’s Cap and Trade Reserve to local decarbonization efforts; thereafter the City would prioritize local decarbonization efforts with these funds. The Council of the City of Palo Alto does hereby RESOLVE, as follows: SECTION 1. The Council approves the updated Electric Supply Portfolio Carbon Neutral Plan (attached, with changes shown in redline, as Exhibit A), which modifies the definition of carbon neutrality to use an hourly carbon emissions accounting standard; authorizes the exchange of bundled RECs from the City’s long-term renewable resources (Bucket 1 RECs) for RPS-eligible, unbundled RECs (Bucket 3 RECs), to the maximum extent possible, while maintaining compliance with the state’s RPS regulations in order to minimize electric supply portfolio costs (“REC Exchanges”); and authorizes the purchase of RPS-eligible, unbundled RECs (Bucket 3 RECs) as needed to neutralize any residual emissions resulting from the difference between emissions calculated under an annual accounting and hourly accounting methodology for calendar years 2020 through 2024. SECTION 2. The Council approves the creation of a Cap and Trade Program Reserve in the Electric Fund which will hold revenues from the sale of carbon allowances freely allocated to the electric utility under the State’s Cap and Trade Program. SECTION 3. The Council directs staff to return to Council in 2022 to review the authorization to minimize electric supply portfolio costs via REC Exchanges. SECTION 4. The Council directs staff to return to Council by the end of 2024 with a review of the Carbon Neutral Plan to evaluate the effectiveness of these policy changes and to Attachment A 3 modify them if necessary (with a particular focus on reviewing the use of Bucket 3 RECs to neutralize any residual emissions resulting from the switch to an hourly emissions accounting methodology). and SECTION 5. The Council finds that the adoption of this resolution updating the City’s Electric Supply Portfolio Carbon Neutral Plan is not subject to California Environmental Quality Act (CEQA) review because it is an administrative government activity that will not result in any direct or indirect physical change to the environment (CEQA Guidelines section 15378(b)(5)). INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ___________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ___________________________ Assistant City Attorney City Manager ___________________________ Director of Utilities ___________________________ Director of Administrative Services Exhibit to ATTACHMENT A 1 Adopted by City Council on March 4, 2013 Revised by City Council on _______________ City of Palo Alto Utilities Electric Supply Portfolio Carbon Neutral Plan 1.Carbon Neutral Definition A carbon neutral electric supply portfolio will demonstrate annual net zero greenhouse gas (GHG) emissions, measured at the Citygate1, in accordance with The Climate Registry’s Electric Power Sector protocol for GHG emissions measurement and reporting. by applying the average hourly carbon emissions intensity of the electricity on the CAISO grid to the City’s net load for each hour of the year. 2.Carbon Neutral Plan Objective Reduce the City of Palo Alto’s overall community GHG emissions by achieving carbon neutrality for the Electric Supply Portfolio starting in calendar year 2013 within an annual rate impact not to exceed 0.15 cents per kilowatt-hour (₵/kWh) primarily through the: 1) engagement of customers to increase energy efficiency; 2) expansion of long-term renewable resource commitments; 3) promotion of local renewable resources; 4) continued reliance on existing hydroelectric resources; and 5) meeting short-term balancing requirements and/or neutralizing residual carbon through the use of short-term purchases of renewable resources and/or renewable energy certificates (RECs). 3.Resource Strategies a.Energy Efficiency i.Continue to pursue energy efficiency strategies as identified in the Council- approved ten-year Energy Efficiency Plan. b.Long-term Renewable Resources i.Continue to pursue the City’s Renewable Portfolio Standard (RPS) goal to purchase renewable energy to supply at least 3360% of retail sales by 2015 2030 while ensuring that the retail rate impact of these purchases does not exceed 0.5 ₵/kWh. ii.Continue to pursue local renewable resources through the Palo Alto CLEAN and PV Partners programs. iii.Pursue additional RPS-eligible, long-term renewable resources (beyond the RPS goals) to achieve a target of 100% carbon-free resources based on average year hydroelectric generation. 1 Citygate is the location of the City’s main meter where the City interconnects to the Pacific Gas and Electric transmission system. Emissions associated with of the output of the locally sited fossil gas fired combustions units (COBUG), while not measured at Citygate, will be neutralized. Exhibit to ATTACHMENT A 2 c.Short-term Renewable Resources and Renewable Energy Certificates i.Minimize electric supply portfolio costs by exchanging bundled RECs from the City’s long-term renewable resources (Bucket 1 RECs) for RPS-eligible, unbundled RECs (Bucket 3 RECs) to the maximum extent possible while maintaining compliance with the state’s RPS regulations; i.For calendar years 2013 2020 through 20162024, procure additional short-term renewables, if the price is comparable to that of an un-bundled REC; ii.For calendar years 2013 through 2016, procure or RPS-eligible, un-bundled RECs (Bucket 3 RECs) as needed to achieve carbon neutrality based on actual load and resources; iii.Neutralize anthropogenic GHG emissions associated with the City’s purchase of renewable resources with RPS-eligible unbundled-RECs (Bucket 3 RECs), which may or may not be RPS-eligible. d.Banking and Truing Up i.In the event that there are surplus renewables beyond the City’s load in a particular year, bank as many RECs as allowable under the TCR EPS protocol from qualifying renewables from that year to minimize the need for purchasing RECs in subsequent years. ii.Neutralize emissions associated with market purchases resulting from deviations between expected and actual load and renewable and hydroelectric generation resources with unbundled-RECs, which may or may not be RPS-eligible. For calendar years 2020 through 2024, neutralize residual emissions that result from applying an hourly emissions accounting methodology, rather than a net annual generation methodology, with RPS-eligible unbundled-RECs. 4.Hydroelectric Resources a.Continue to preserve and advocate for existing carbon-neutral hydroelectric generation resources that provide approximately 50% of average year resource needs. b.Plan for and acquire carbon neutral resources assuming average hydroelectric conditions going forward. c.Under adverse hydroelectric conditions, procure RPS-eligible unbundled-RECs, which may or may not be RPS-eligible, to achieve carbon neutrality up to the 0.15 ₵/kWh rate impact limit and seek Council direction if carbon neutrality cannot be achieved within the rate impact limit. d.Under favorable hydroelectric conditions, where carbon neutral resources are expected to be surplus to needs, even after allowable banking, then pursue selling short-term renewable energy, or the renewable attributes, associated with one or more carbon- neutral resources in the portfolio. 5.Financial and Rate Payer Impacts a.In addition to the RPS annual rate impact limit of 0.5 ₵/kWh, the cost of achieving carbon neutrality shall not exceed 0.15 ₵/kWh based on an average hydro year. Exhibit to ATTACHMENT A 3 b.Revenues collected from surplus energy sales related to hydroelectric resources under favorable conditions (e.g. wet years), will be maintained within reserves to adjust for the cost of achieving carbon neutrality under adverse hydroelectric years. c.To the extent available and allowable, revenues from the auction of cap-and-trade allowances may be used to fund resources acquired to meet the carbon neutrality goals. 6.Reporting and Communication a.Develop a communication plan for stakeholders to inform them of the City’s efforts towards achieving a carbon neutral electric supply. b.Submit an annual, verified report of the carbon content of the electric supply portfolio to The Climate Registry. c.b. Provide customers a report of the electric supply portfolio’s carbon content to supplement the mandated Power Content Label. d.Inform large commercial and/or corporate customers of the City’s carbon neutral portfolio and its relevance to their individual corporate sustainability goals. e.c. 7.Implementation Plan The tasks that need to be completed in the next two years pending Council approval of the Carbon Neutral Plan in February 2013 are listed in the table below. Item Timeframe 1.Modify electric supply portfolio models and Energy Risk Management Policies, Guidelines and Procedures to account for Carbon Neutral objectives, balancing, banking of renewable attributes, reporting and financial impacts. By April 2013 2.Modify the Long-term Electric Acquisition Plan (LEAP) to include the carbon neutral objective By June 2013 3.Develop communication plan to inform customers and stakeholders of Carbon Neutral Plan and efforts. February to April 2013 4.Based on response to the Fall 2012 request for proposals, seek approval of new renewable power purchase agreements to meet the City’s RPS up to approximately 100% of the long-term resource needs in average hydro years. December 2012 to June 2013 5.Determine resource needs for CY 2013 through CY 2016 and develop plan to acquire short-term renewable resources. By June 2013 6.Determine long-term renewable purchase volumes for beyond CY 2016 and develop plan to acquire long-term renewable resources. By September 2013 7.Procure RECs as needed to neutralize carbon emissions based on actual load and resources for CY 2013. By May 2014 8.Along with annual Power Content Label, produce and report to customers the carbon intensity of the electric supply portfolio. May/June 2014 and annually thereafter 9.Produce and submit Electric Power Sector (EPS) and Local Governments Operation Protocol (LGOP) reports to The Climate July and October 2014 and annually Exhibit to ATTACHMENT A 4 Registry (TCR) for CY 2013. thereafter 10.Get independent verification of TCR reports and submit audited reports to TCR. By December 2014 and annually thereafter 11.Redesign the PaloAltoGreen program according to Council direction. By December 2013 Attachment B California’s Cap-and-Trade Program Synopsis The Global Warming Solutions Act of 2006, also known as Assembly Bill (AB) 32, authorized the California Air Resources Board (CARB) to develop regulations to lower the state’s greenhouse gas (GHG) emissions to 1990 levels by 2020. CARB developed a cap-and-trade program as one of the strategies to achieve the 2020 goal. Under the cap-and-trade program, an overall limit on GHG emissions from capped sectors is established and facilities subject to the cap are able to trade permits (allowances) to emit GHGs. To do this, entities with emissions are required to hold enough allowances (an allowance being equivalent to one metric ton of greenhouse gas, or CO2e) to cover its emitted output in a given year, also called its ‘compliance obligation.’ Entities can purchase allowances at quarterly auctions held by CARB. The auction has a floor (or reserve) price, which started at $10 per allowance in 2012 and has increased every calendar year by 5% plus the rate of inflation as measured by the Consumer Price Index. As of 2020, the Reserve price is at $16.68 per allowance. Over the last three years, auction prices have settled anywhere between the reserve price (as it did in the May 2020 auction) to $1.83 more (in the May 2019 auction). In addition, certain entities and public power agencies, such as Palo Alto, have been distributed free allowances to reduce the rate shock to customers from the purchase of required allowances. The City’s Electric utility was required to participate in the cap-and-trade program starting in 2013 but does not own or operate fossil fuel-based electricity generation covered by the cap-and-trade regulations. Therefore, the Electric utility does not incur a compliance obligation annually, but still receives free allowances. (The utility is, however, indirectly exposed to cap-and-trade allowance costs to the extent that it makes purchases of generic market power. The generators of this power must pay for allowances to generate and these costs are then passed on to the buyers of that output.) The quantity of allowances received is scheduled to decrease over time—Palo Alto’s allowance allocation was 340,533 in 2013 but is expected to decrease to 110,496 by 2030. As the Electric utility has no compliance obligation, it cannot retain any allowances for future use but must instead sell them at auction. The Palo Alto Gas utility, on the other hand, does incur a compliance obligation annually based on the amount of gas imported and utilized within the City. The Gas utility has been required to participate in the cap and trade program since 2015, and while it also receives free allowances every year, the quantity received does not fully cover the utility’s compliance obligation, and also decreases annually (in 2015 it was based on about 94% of 2011 emissions, but is expected to drop to about 51% of 2011 emissions by 2030). A portion of the allowances it receives can be held towards its compliance obligation, but the remainder must be sold at auction. The share that must be sold increases every year—in 2015, 25% was required to be sold, increasing by 5% annually, reaching 100% in 2030. And any allowances required to make up its compliance obligation must be purchased via auction (the electric utility cannot transfer or sell allowances to the gas utility directly). Attachment B Revenues from the auction sale of allowances in each utility must be used exclusively for the benefit of the ratepayers in that utility. The California Code of Regulations (CCR Title 17, sections 95892 and 95893) details how entities must use those funds, but in general, these can be for 1) the support for, construction of, or purchase of eligible renewable generation resources directly to California (this applies to the electric utility only), 2) the funding of certain energy efficiency rebates, retrofits, and fuel switching programs, 3) funding for programs with demonstrated GHG reductions, 4) non-volumetric return to ratepayers, either on or off bill, and 5) certain administrative, outreach and educational costs related to items 1-4 above. The City Council has also adopted a policy on the use of allowance proceeds (Resolution 9487), with expressed preference that revenues be used for programs and projects rather than being returned to ratepayers in the form of a bill rebate. Per the current regulations, the utility must either spend or rebate the funds received in any given year within 10 years (for example, funds received in 2020 must be spent by 2030, etc.). Attachment C Carbon Neutral Plan Background, Hourly vs. Annual Carbon Accounting Methodologies, In- State vs. Out-of-State Renewable Energy Credits Carbon Neutral Plan Background When Council approved the Carbon Neutral Plan in March 2013 (Staff Report 3550, Resolution 9322), it defined carbon neutrality as a portfolio that “will demonstrate annual net zero greenhouse gas (GHG) emissions, measured at the Citygate, in accordance with The Climate Registry’s Electric Power Sector protocol for GHG emissions measurement and reporting.” In effect, this means that if the City’s carbon neutral supplies (in megawatt-hours (MWh)) equal or exceed the City’s total load on an annual basis then the electric supply would be deemed to be carbon neutral. At the time, this accounting methodology was considered to be the most accurate accounting methodology that could be achieved—or needed. This was in part because in 2013 there was very little solar generation connected to the California Independent System Operator (CAISO) grid, and therefore the grid’s average emissions factors did not vary in the extreme manner that they do today—for example, as in the emissions rate chart shown in Figure 1 below, for CAISO emissions on February 12, 2020. But, more practically, CAISO did not begin to publish hourly grid emissions factor data until 2018, and therefore a more granular accounting methodology was not feasible at that time. Figure 1: CAISO Average CO2 Emissions Rates for February 12, 2020 In addition, the 2013 Carbon Neutral Plan (CN Plan) did not contemplate the type of situation the City finds itself in today, where, on an annual basis, it has an ongoing surplus of carbon neutral supplies (under normal hydro conditions) relative to its load. The original CN Plan addressed the City’s strategies for obtaining carbon neutral supplies equal to its annual load (specifically, it authorized the purchase of unbundled RECs on a short-term basis, with an Attachment C ultimate goal of procuring enough long-term renewable supplies to fully satisfy the City’s annual load). Hourly vs. Annual Carbon Accounting At the February 2020 UAC meeting, there was a consensus opinion that hourly accounting should be used by staff for the evaluation of different supply and demand resources. Staff strongly supports this position too, believing that an hourly accounting framework is the right way to think about long-term procurement decisions. (Doing so in a rigorous way will ultimately require the City to assign a monetary value to carbon emissions—but that topic can be addressed at a later date.) Staff thinks that hourly grid carbon emissions rates are important to incorporate into our internal decision-making and reporting in a variety of ways. There is no immediate cost associated with incorporating hourly accounting into internal decision-making; doing so simply prepares the City for when energy markets and regulations ultimately shift to a more granular carbon accounting paradigm. Adopting hourly carbon accounting instead of annual accounting for measuring the carbon content of the City’s electric supply portfolio, on the other hand, is likely to have a modest financial impact.1 The reason for the additional cost associated with this approach is that, in holding the City’s electric supply portfolio up to a stricter carbon accounting standard, this approach is likely to show, in an average year, that the City’s portfolio is responsible for a small amount of “residual” emissions, even though its supplies match its load on an annual basis.2 In order to maintain the carbon neutral status of its electric supply under an hourly accounting framework, the City would have to purchase additional resources in order to neutralize these residual emissions. If the City were to adopt the use of hourly accounting for its portfolio decisions right now, in order to minimize the cost impact associated with adopting an hourly accounting framework, staff recommends authorizing the purchase of out-of-state renewable energy (also called “unbundled, Bucket 3 RECs”) on a short-term basis to neutralize these residual emissions. Based on current market prices for unbundled RECs, staff estimates the cost associated with neutralizing these residual emissions to be $140,000/year. 1 As described in the February 2020 UAC report, the accounting methodology proposed by staff entails an hourly comparison of the City’s supplies and load, with each hourly net load/supply value assigned the average hourly carbon emissions intensity of the CAISO grid to convert it to an hourly emissions total that the City’s electric portfolio is responsible for. These hourly emissions totals (which can be positive or negative, depending on whether or not the City’s load exceeds its carbon neutral supplies for that hour) would then be summed across the hours in a year. 2 These “residual emissions” occur because the City has a heavy concentration of solar resources in its supply portfolio. Thus, the periods when the City has a surplus of resources relative to its load tend to be in periods when the grid is relatively clean overall; conversely, the periods when the City typically has supply deficits relative to its load tend to be at times when the grid is dirtier overall. Based on 2018 grid emissions and generation data for the City’s resources, staff calculated these residual emissions to be approximately 16,000 MT CO2 for the year. Attachment C In-state, Bundled Renewable Energy (Bucket 1 RECs) vs. Out-of-state, Unbundled Renewable Energy (Bucket 3 RECs) The fundamental difference between bundled renewables (or “Bucket 1 RECs”) and unbundled (“Bucket 3”) RECs, as the diagram in Figure 1 illustrates, is that with bundled renewables both the energy and the REC (which represents the environmental value of the energy) are sold together to the same entity. With unbundled RECs, the energy and the REC are sold separately to different entities. Practically speaking though, Bucket 1 RECs are almost always produced by in-state renewable generators, while Bucket 3 RECs are produced by out-of-state renewable generators. Also, because of limitations placed on the use of Bucket 3 RECs for compliance purposes in the state’s RPS legislation, and because of strong demand for Bucket 1 resources as Community Choice Aggregators (CCAs) ramp up their energy purchases, Bucket 1 RECs currently carry a significant price premium relative to Bucket 3 RECs, in spite of the fact that these two resources represent equivalent amounts of renewable energy. Figure 2: Bundled (Bucket 1) vs. Unbundled (Bucket 3) RECs Diagram3 If the community prefers to implement an hourly carbon accounting framework using California- based Bucket 1 renewables in the long-term, staff can optimize the electric portfolio to minimize costs under this policy. However, the City will not have an easily available opportunity to rebalance the electric portfolio until 2024. As a result, implementing hourly accounting using Bucket 1 renewables right now has significant downsides. The principal drawback to this approach is its cost impact. Due to the aforementioned price premium for Bucket 1 RECs right now, staff estimates the cost of neutralizing the residual emissions with Bucket 1 RECs to be about $620,000/year, as shown in Table 1 below, which is $480,000/year greater than the cost of using Bucket 3 RECs for this purpose. In staff’s view, this represents a significant increase in costs (and therefore a significant reduction in funds that could be allocated either to local 3 Source: Pinkel, D., and Weinrub, A., “What the Heck is a REC?” October 2013. http://www.localcleanenergy.org/files/What%20the%20Heck%20is%20a%20REC.pdf Attachment C decarbonization efforts or rate reduction) with little to no additional environmental value to show for it.4 In the short-term, utilizing Bucket 1 renewables to neutralize residual emissions will not result in the construction of any new renewables, just additional expenditures. Use of Bucket 3 RECs in the short-term, however, has a minimal rate impact and enables the City to adopt hourly accounting for its electric portfolio in anticipation of long-term portfolio rebalancing. Table 1: Summary Comparison of Carbon Accounting Methodology Options Option 1: Annual Accounting (Sell All Surplus) Option 2: Hourly Accounting (with Bucket 1 Renewables) Option 3: Hourly Accounting (with Bucket 3 RECs) Surplus Sales Revenue ($M) $ 2.24 $ 2.24 $ 2.24 Residual Emissions Abatement Cost ($M) $ - $ 0.62 $ 0.14 Net Revenue ($M) $ 2.24 $ 1.62 $ 2.10 Rate Impact (%)* -1.5% -1.1% -1.4% RPS Level (%) (Bucket 1 Only) 45% 50% 45% Energy Supply Level (% of Annual Load) 100% 105% 100% (+5% unbundled RECs) PCL Emissions Intensity (lb CO2/MWh) 9.4 10.4 9.4 Hourly Accounting Emissions Intensity (lb CO2/MWh) 42.3 - 42.3 *Notes: “Rate Impact” assumes all net revenue is devoted to rate reduction. Revenue and cost values are annual averages over the 2020-2030 time period. Furthermore, committing to the use of Bucket 1 renewables in the near-term to neutralize the portfolio’s residual emissions under an hourly accounting approach forces the City to incur a relatively large increase in supply costs to address the emissions impact of procurement decisions made long ago—at a time when the varying hourly emissions profiles of different types of resources was not foreseeable. Rather than imposing such a large cost on the City to account for portfolio decisions made years ago, staff recommends taking hourly emissions accounting impacts into account for future portfolio decisions, as well as reconsidering the use 4 For a full discussion of the environmental merit of Bucket 3 RECs relative to Bucket 1 renewables, please see Attachment B of this August 2019 UAC report. In short though, Bucket 3 RECs represent all of the environmental attributes of the underlying generation, including its emissions profile. And within California there is currently an over-supply of renewable energy at many times of the year, while neighboring states retain a significant reliance on coal and natural gas generators; as a result, out-of-state renewable generation can be more valuable environmentally than in-state renewable generation. Attachment C of Bucket 1 renewables for neutralizing the portfolio’s residual emissions the next time the City has an opportunity to significantly rebalance its supply portfolio—which should be around 2024, when the City will make a final decision on whether or not to renew its Western Base Resource hydro contract. By that time, market conditions and regulations related to Bucket 1 and Bucket 3 RECs may have changed, and the price premium of Bucket 1 renewables relative to Bucket 3 RECs may be lower than it is today. In considering the use of Bucket 3 RECs for neutralizing residual emissions, it’s important to note that the original Carbon Neutral Plan established a goal of obtaining Bucket 1 renewable supplies equal to the City’s load on an annual basis, and it allowed for the use of Bucket 3 RECs to address the reduction in carbon neutral generation that occurs in low hydro years. However, the Plan did not contemplate a scenario where the City has an overall surplus of supplies on an on-going basis (or where grid emissions rates vary significantly over the course of the year). Using Bucket 3 RECs for neutralizing residual emissions remains true to that original Carbon Neutral Plan: the City would still have Bucket 1 renewable supplies equal to its load on an annual basis. This approach simply augments the original Plan by addressing what to do with the City’s supplies that exceed its annual load, and how to address the fact that grid emissions now vary dramatically from hour to hour and season to season. APPENDIX A: ELECTRIC UTILITY RESERVES MANAGEMENT PRACTICES The following reserves management practices are used when developing the Electric Utility Financial Plan: Section 1. Definitions a)“Financial Planning Period” – The Financial Planning Period is the range of future fiscal years covered by the Financial Plan. For example, if the Financial Plan delivered in conjunction with the FY 2015 budget includes projections for FY 2015 to FY 2019, FY 2015 to FY 2019 would be the Financial Planning Period. b)“Fund Balance” – As used in these Reserves Management Practices, Fund Balance refers to the Utility’s Unrestricted Net Assets. c)“Net Assets” - The Government Accounting Standards Board defines a Utility’s Net Assets as the difference between its assets and liabilities. d)“Unrestricted Net Assets” - The portion of the Utility’s Net Assets not invested in capital assets (net of related debt) or restricted for debt service or other restricted purposes. Section 2. Supply Fund Reserves The Electric Supply Fund Balance is reserved for the following purposes: a)For existing contracts, as described in Section 4 (Reserve for Commitments) b)For operating budgets reappropriated from previous years, as described in Section 5 (Reserve for Reappropriations) c)For special projects for the benefit of the Electric Utility ratepayers, as described in Section 6 (Electric Special Projects Reserve) d)For year to year balancing of costs associated with the Electric Utility’s hydroelectric resources, as described in Section 7 (Hydroelectric Stabilization Reserve) e)For rate stabilization, as described in Section 1.d) (Rate Stabilization Reserves) f)For operating contingencies, as described in Section 12 (Operations Reserves) g)Any funds not included in the other reserves will be considered Unassigned Reserves and shall be returned to ratepayers or assigned a specific purpose as described in Section 13 (Unassigned Reserves). Section 3. Distribution Fund Reserves The Electric Distribution Fund Balance is reserved for the following purposes: a)For existing contracts, as described in Section 4 (Reserves for Commitments) b)For operating and capital budgets reappropriated from previous years, as described in Section 5 (Reserves for Reappropriations) c)As an offset to underground loan receivables, as described in Section 8 (Underground Loan Reserve) d)To hold Public Benefit Program funds collected but not yet spent, as described in Section 9 (Public Benefits Reserve) e)For cash flow management and contingencies related to the Electric Utility’s Capital Improvement Program (CIP), as described in Section 10 (CIP Reserve) f)For rate stabilization, as described in Section 11.d) (Rate Stabilization Reserves) g)For operating contingencies, as described in Section 12 (Operations Reserves) Attachment D h) Any funds not included in the other reserves will be considered Unassigned Reserves and shall be returned to ratepayers or assigned a specific purpose as described in Section 14 (Unassigned Reserves). Section 4. Reserves for Commitments At the end of each fiscal year the Electric Supply Fund and Electric Distribution Fund Reserves for Commitments will be set to an amount equal to the total remaining spending authority for all contracts in force for the Electric Supply Fund and Electric Distribution Fund, respectively, at that time. Section 5. Reserves for Reappropriations At the end of each fiscal year the Electric Supply Fund and Electric Distribution Fund Reserves for Reappropriations will be set to an amount equal to the amount of all remaining capital and non-capital budgets that will be reappropriated to the following fiscal year for each Fund in accordance with Palo Alto Municipal Code Section 2.28.090. Section 6. Electric Special Projects Reserve The Electric Special Projects Reserve (ESP Reserve) will be managed in accordance with the policies and timelines set forth in Resolution 9206 (Resolution of the Council of the City of Palo Alto Approving Renaming the Calaveras Reserve to the Electric Special Project Reserve and Adoption of Electric Special Project Reserve Guidelines). These policies and timelines are included from Resolution 9206 as amended to refer to the reserves structure set forth in these Reserves Management Practices: a) The purpose of the ESP Reserve is to fund projects that benefit electric ratepayers; b) The ESP Reserve funds must be used for projects of significant impact; c) Projects proposed for funding must demonstrate a need and value to electric ratepayers. The projects must have verifiable value and must not be speculative, or high-risk in nature; d) Projects proposed for funding must be substantial in size, requiring funding of at least $1 million; e) Set a goal to commit funds by the end of FY 2017; f) Any uncommitted funds remaining at the end of FY 2022 will be transferred to the Electric Supply Operations Reserve and the ESP Reserve will be closed; Section 7. Hydroelectric Stabilization Reserve The Hydroelectric Stabilization Reserve is used to manage the supply cost impacts associated with variations in generation from hydroelectric resources. Staff will manage the Hydroelectric Stabilization Reserve as follows: a) Projected Hydro Output: Near the end of each fiscal year, staff will determine the actual and expected hydro output for that fiscal year, compare that to the long-term average annual output level (495,957 MWh as of March 2018), and multiply the difference by the average of the monthly round-the-clock forward market prices for each month of the current fiscal year. b) Changes in Reserves. Staff is authorized to transfer the amount described in Sec. 7(a) from the Operations Reserve to the Hydroelectric Stabilization Reserve for hydro output deviations above long-term average levels, or transfer this amount from the Hydroelectric Stabilization Reserve to the Operations Reserve for hydro output deviations below long-term average levels. c) Implementation of HRA. The level of the Hydroelectric Stabilization Reserve after the transfers described above shall be the basis for staff’s determination, with Council approval, of whether to implement the Hydro Rate Adjuster (Electric Rate E- HRA) for the following fiscal year. d) Reserve Guidelines. Staff will manage the Hydroelectric Stabilization Reserve according to the following guideline levels: Minimum Level $3 million Target Level $19 million Maximum Level $35 million Section 8. Underground Loan Reserve At the end of each fiscal year, the Underground Loan Reserve will be adjusted by the principal payments made against outstanding underground loans. Section 9. Public Benefits Reserve The Public Benefits Reserve will be increased by the amount of unspent Public Benefits Revenues remaining at the end of each fiscal year. Expenditure of these funds requires action by the City Council. Section 10. CIP Reserve The CIP Reserve is used to manage cash flow for capital projects and acts as a reserve for capital contingencies. Staff will manage the CIP Reserve according to the following practices: a) The following guideline levels are set forth for the CIP Reserve. These guideline levels are calculated for each fiscal year of the Financial Planning Period and approved by Council resolution. Minimum Level 20% of the maximum CIP Reserve guideline level Maximum Level Average annual (12 month)1 CIP budget, for 48 months of budgeted CIP expenses2 b) Changes in Reserves: Staff is authorized to transfer funds between the CIP Reserve and the Reserve for Commitments when funds are added to or removed from the Reserve for Commitments as a result of a change in contractual commitments related to CIP projects. Any other additions to or withdrawals from the CIP reserve require Council action. 1 Each month is calculated based upon 1/12 of the annual budget. 2 For example, in the Financial Plan for FY 2021, the 48 month period to use to derive the annual average is FY 2021 through FY 2024. In the FY 2022 Financial Plan, the 48 month period to use to derive the annual average would be FY 2022 through FY 2025 etc. c) Minimum Level: i) If, at the end of any fiscal year, the minimum guideline is not met, staff shall present a plan to the City Council to replenish the reserve. The plan shall be delivered by the end of the following fiscal year, and shall, at a minimum, result in the reserve reaching its minimum level by the end of the next fiscal year. For example, if the CIP Reserve is below its minimum level at the end of FY 2017, staff must present a plan by June 30, 2018 to return the reserve to its minimum level by June 30, 2019. In addition, staff may present, and the Council may adopt, an alternative plan that takes longer than one year to replenish the reserve, or that does so in a shorter period of time. d) Maximum Level: If there are funds in this reserve in excess of the maximum level staff must propose in the next Financial Plan to transfer these funds to another reserve or return them to ratepayers in the funds to ratepayers, or designate a specific use of funds for CIP investments that will be made by the end of the next Financial Planning period. Staff may also seek City Council to approve holding funds in this reserve in excess of the maximum level if they are held for a specific future purpose related to the CIP. Section 11. Rate Stabilization Reserves Funds may be added to the Electric Supply or Distribution Fund’s Rate Stabilization Reserves by action of the City Council and held to manage the trajectory of future year rate increases. Withdrawal of funds from either Rate Stabilization Reserve requires action by the City Council. If there are funds in either Rate Stabilization Reserve at the end of any fiscal year, any subsequent Electric Utility Financial Plan must result in the withdrawal of all funds from this Reserve by the end of the Financial Planning Period. The Council may approve exceptions to this requirement, when proposed by staff to provide greater rate stabilization to customers. Section 12. Operations Reserves The Electric Supply Fund and Electric Distribution Fund Operations Reserves are used to manage normal variations in the costs of providing electric service and as a reserve for contingencies. Any portion of the Electric Utility’s Fund Balance not included in the reserves described elsewhere in these Reserve Management Practices will be included in the appropriate Operations Reserve unless the reserve has reached its maximum level as set forth in Section 12 (e) below. Staff will manage the Operations Reserves according to the following practices: a) The following guideline levels are set forth for the Electric Supply Fund Operations Reserve. These guideline levels are calculated for each fiscal year of the Financial Planning Period based on the levels of Operations and Maintenance (O&M) and commodity expense forecasted for that year in the Financial Plan. Minimum Level 60 days of Supply Fund O&M and commodity expense Target Level 90 days of Supply Fund O&M and commodity expense Maximum Level 120 days of Supply Fund O&M and commodity expense b) The following guideline levels are set forth for the Electric Distribution Fund Operations Reserve. These guideline levels are calculated for each fiscal year of the Financial Planning Period based on the levels of O&M expense forecasted for that year in the Financial Plan. Minimum Level 60 days of Distribution Fund O&M expense Target Level 90 days of Distribution Fund O&M expense Maximum Level 120 days of Distribution Fund O&M expense c) Minimum Level: If, at the end of any fiscal year, the funds remaining in the Supply Fund or Distribution Fund’s Operations Reserve are lower than the minimum level set forth above, staff shall present a plan to the City Council to replenish the reserve. The plan shall be delivered within six months of the end of the fiscal year, and shall, at a minimum, result in the reserve reaching its minimum level by the end of the following fiscal year. For example, if the Operations Reserve is below its minimum level at the end of FY 2014, staff must present a plan by December 31, 2014 to return the reserve to its minimum level by June 30, 2015. In addition, staff may present an alternative plan that takes longer than one year to replenish the reserve. d) Target Level: If, at the end of any fiscal year, either Operations Reserve is higher or lower than the target level, any Financial Plan created for the Electric Utility shall be designed to return both Operations Reserves to their target levels by the end of the forecast period. e) Maximum Level: If, at any time, either Operations Reserve reaches its maximum level, no funds may be added to this Reserve. Any further increase in that fund’s Fund Balance shall be automatically included in the Unassigned Reserve described in Section 13, below. Section 13. Unassigned Reserves If the Operations Reserve in either the Electric Supply Fund or the Electric Distribution Fund reaches its maximum level, any further additions to that fund’s Fund Balance will be held in the Unassigned Reserve. If there are any funds in either Unassigned Reserve at the end of any fiscal year, the next Financial Plan presented to the City Council must include a plan to assign them to a specific purpose or return them to the Electric Utility ratepayers by the end of the first fiscal year of the next Financial Planning Period. For example, if there were funds in the Unassigned Reserves at the end of FY 2016, and the next Financial Planning Period is FY 2017 through FY 2021, the Financial Plan shall include a plan to return or assign the funds in the Unassigned Reserve by the end of FY 2017. Staff may present an alternative plan that retains these funds or returns them over a longer period of time. Section 14. Intra-Utility Transfers between Supply and Distribution Funds Transfers between Electric Distribution Fund Reserves and Electric Supply Fund Reserves are permitted if consistent with the purposes of the two reserves involved in the transfer. Such transfers require action by the City Council. Section 15. Low Carbon Fuel Standard (LCFS) Reserve This reserve tracks revenues earned via the sale of Low Carbon Fuel Credits allocated by the California Air Resources Board to the City, as well as expenses incurred, in accordance with California’s Low Caron Fuel Standard program. At the end of each fiscal year, the LCFS Reserve will be adjusted by the net of revenues and expenses associated with California’s LCFS program. Section 16. Cap and Trade Program Reserve This reserve tracks unspent or unallocated revenues from the sale of carbon allowances freely allocated by the California Air Resources Board to the electric utility, under the State’s Cap and Trade Program. Funds in this Reserve are managed in accordance with the City’s Policy on the Use of Freely Allocated Allowances under the State’s Cap and Trade Program (the Policy), adopted by Council Resolution 9487 in January 2015. City of Palo Alto (ID # 11030) City Council Staff Report Report Type: Informational Report Meeting Date: 8/17/2020 City of Palo Alto Page 1 Summary Title: Investment Activity Report Title: City of Palo Alto Investment Activity Report for the Fourth Quarter, Fiscal Year 2020 From: City Manager Lead Department: Administrative Services Background The City’s investment policy requires that staff report to Council quarterly on the City’s portfolio composition and performance compared to the Council-adopted policy; discuss overall compliance with the City’s Investment Policy; and provide recommendations, if any, for policy changes. In addition, staff provides a detailed list of all securities and report on the City’s ability to meet expenditure requirements over the next six months. This report is to inform Council of the City’s investment portfolio performance as of the fourth quarter ending June 30, 2020, and to disclose staff’s cash flow projections for the next six months. Discussion The City’s investment portfolio is summarized in Graph 1 and detailed in the Investments by Fund Report (Attachment B). The Investments by Fund Report groups the portfolio’s securities by investment type and includes details of the investment issuer, date of maturity, current market value, the book and face (par) value, and the weighted average maturity of each type of investment and of the entire portfolio. City of Palo Alto Page 2 U.S. Treasury 1.9% U.S. Agency 37.2% U.S. Municipal/State 28.8% Negotiable CD 7.1% U.S. Corporate 3.2% Supranational 4.7% Liquid Accts. 17.2% Graph 1: Investments by Type -$554.3M (Par Value) The par value of the City’s portfolio is $554.3 million; in comparison, last quarter it was $544.5 million and last year it was $536.9 million. The $9.8 million portfolio growth since the last quarter and $17.4 million growth since the same quarter of last year is due to timing of cash flows but this year, due to COVID-19 impacts, the story is more complex. Compared to the same quarter of last year, cash receipts are down by $17.6 million or 13.3 percent and cash disbursements are down by $15.1 million or 11.1 percent with the net cash receipt being down by $2.7 million. Contributing factors to the portfolio growth include COP bonds reimbursement of $29.6 million for the construction of the California Avenue Parking garage. Most of these costs occurred in the prior quarters which is partially offset by items like extra payroll costs due to an extra pay period in the fourth quarter. The portfolio consists of $95.4 million in liquid accounts and $458.9 million in various investment types as detailed in the following Table 1. The investment policy requires that at least $50 million be maintained in securities maturing in less than two years. The portfolio includes $126.8 million in investments maturing in less than two years, comprising 22.9 percent of the City’s investment portfolio. In addition, the Investment Policy allows up to 30 percent of the portfolio to be invested in securities with maturities beyond five years; the actual at the end of the second quarter is 26.9 percent of the portfolio. City of Palo Alto Page 3 Table 1: Up to 1 Year 1 to 2 Years 2 to 3 Years 3 to 5 Years Over 5 Years Portfolio Total * % of Portfolio U.S. Treasury -$ 1.5$ 9.0$ -$ -$ 10.5$ 1.9% U.S. Agency Bonds 35.0 23.3 39.2 33.4 75.4 206.3 37.2% U.S. Municipal/ State Bonds 18.0 21.2 14.6 32.6 73.1 159.5 28.9% Negotiable Certificates of Deposits (NCD)6.1 10.9 8.4 13.0 0.7 39.1 7.1% U.S. Corporate Bonds 9.9 0.9 0.6 6.3 - 17.7 3.2% Supranational Organizations Bonds - - 3.0 22.8 - 25.8 4.7% Liquid Accounts (LAIF & Fidelity)95.4 - - - - 95.4 17.2% Grand Total 164.4$ 57.8$ 74.8$ 108.1$ 149.2$ 554.3$ 100% % of Portfolio 29.7%10.4%13.5%19.5%26.9%100.0% * $38.4 million or 6.9 percent are in investments that support Environmental, Social, and Governace (ESG) Activities (aka "Green" and Supranational Bonds) Maturities - Par Value (millions) Investment Type The current market value of the portfolio is 102.7 percent of the book value. The market value of securities fluctuates, depending on how interest rates perform. When interest rates decrease, the market value of the securities in the City’s portfolio will likely increase; likewise, when interest rates increase, the market value of the securities will likely decrease. Understanding and showing market values is not only a reporting requirement, but essential to knowing the principal risks in actively buying and selling securities. It is important to note, however, that the City’s practice is to buy and hold investments until they mature so changes in market price do not affect the City’s investment principal. The market valuation is provided by Union Bank of California, which is the City’s safekeeping agent. The average life to maturity of the investment portfolio is 3.54 years compared to 4.12 years last quarter. Investments Made During the Fourth Quarter During the fourth quarter, $99.1 million of securities with an average yield of 2.0 percent matured. During the same period, per the following Table 2, government securities totaling $41.1 million with an average yield of 1.5 percent were purchased. The expectation is interest rates and the City’s portfolio’s average yield will decline. The City’s short-term money market and pool account increased by $67.8 million compared to the third quarter. Staff continually monitors the City’s short-term cash flow needs and adjusts liquid funds to meet them. City of Palo Alto Page 4 Table 2: Up to 1 Year 1 to 2 Years 2 to 3 Years 3 to 5 Years Over 5 Years Portfolio Total * % of Purchase U.S. Agency Bonds -$ -$ -$ -$ 38.3$ 38.3$ 93.2% U.S. Municipal/ State Bonds 0.6 - - - 1.2 1.8 4.4% Negotiable Certificates of Deposits (NCD)- - - 0.5 0.5 1.0 2.4% Grand Total 0.6$ -$ -$ 0.5$ 40.0$ 41.1$ 100% % of Purchase 1.5%0.0%0.0%1.2%97.4%100.1% Investment Type 2019 Q3 Security Purchases - Par Value (millions) Availability of Funds for the Next Six Months Normally, the flow of revenues from the City’s utility billings and General Fund sources is enough to provide funds for ongoing expenditures in those respective funds. Projections indicate receipts will be $259.5 million and expenditures will be $288.1 million over the next six months, indicating an overall decline in the portfolio of $28.6 million. All of the expected decline is attributable to pre-paying a portion of the Fiscal Year 2021 Public Employers’ Retirement System’s (PERS) employer contribution of $33.5 million, representing the City’s unfunded accrued liability (UAL) lump-sum payment for FY 2021. By prepaying PERS UAL instead of making payments with each payroll period, the City is expected to save $1.2 million in pension expense; however, the savings will be offset by the loss of approximately $0.3 million in interest income in the City’s investment portfolio. This result in net citywide savings of $0.9 million is due to PERS’ expected ability to earn interest earlier and at a higher rate than the City could realize. Without this prepayment, the portfolio’s expected to increase by $4.9 million. As of June 30, 2020, the City had $95.4 million deposited in the Local Agency Investment Fund (LAIF) and a money market account that could be withdrawn daily. In addition, investments totaling $27.9 million will mature between July 1, 2020 and December 31, 2020. Based on the above and staff’s revenue and expenditure forecast for the next six months, staff is confident that the City will have more than enough funds or liquidity to meet expenditure requirements for the next six months. Compliance with City Investment Policy During the fourth quarter, staff complied with all aspects of the investment policy. Attachment C lists the major restrictions in the City’s investment policy compared with the portfolio’s actual performance. Investment Yields Interest income on an accrual basis for the fourth quarter was $2.9 million which is $0.3 million or 9.4 percent lower over the same period last year. As of June 30, 2020, the yield to maturity City of Palo Alto Page 5 of the City’s portfolio was 1.96 percent and last year it was 2.38 percent. In the fourth quarter, LAIF’s average yield was 1.41 percent while the average yield on the two-year and five-year Treasury bonds was approximately 0.19 percent and 0.36 percent, respectively. The declining interest rate is expected to continue the decrease in the portfolio’s yields. Historically, the City’s portfolio yield has outperformed the two-year and five-year Treasury bond rates and did so again starting a year ago; this is an expected occurrence during economic downturns. As the City’s laddered portfolio investments mature in the next year or two, funds are expected to be reinvested, mostly in lower yielding securities compared to the yield on the matured investments. Graph 2 shows the City’s yields and interest earnings for the past 19+ years. 5.79% 4.19%City of Palo Alto 4.41% 2.91% 1.93% 1.96% 2 Yr. Treasury 0.19% 5 Yr. Treasury 0.36% LAIF 1.41% $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 $4.5 $5.0 0% 1% 2% 3% 4% 5% 6% Int. Earnings (Millions)Yields Fiscal Year Quarters Graph 2: Yields and Interest Earnings City’s portfolio duration is 3.54 years. Yield Trends The Federal Open Market Committee (FOMC) did its first emergency and unscheduled federal fund rate cut since 2008, by 0.50 percent (aka 50 basis points), then again two weeks later by 0.75 percent to 0.25 percent in March 2020. Table 3, below, shows this and past such rate cuts. In its June 2020 statement, the FOMC cited that COVID-19 “has induced sharp declines on economic activity and a surge in job losses” and will keep this target range until the economy has weathered the current crisis. In addition to the rate cut, the FOMC is prepared to support City of Palo Alto Page 6 the flow of credit to households and businesses by increasing its holdings in Treasury and federal agency securities. The FOMC expectation is future federal fund rate changes will be dependent on economic data, including global developments and inflation movements. Table 3: Emergency FOMC Rate Cuts (2001-2020) # Date Size of Cut Event 1 Jan. 2001 0.50% Dotcom Bubble 2 Apr. 2001 0.50% Weak Economy 3 Sept. 2001 0.50% 9/11 Terrorist Attack 4 Aug. 2007 0.75% Housing Bubble 5 Jan. 2008 0.50% Stock Market Crash 6 Oct. 2008 0.50% Lehman Collapse 7 Mar. 3, 2020 0.50% Coronavirus Pandemic 8 Mar. 15, 2020 0.75% Coronavirus Pandemic Source: Piper Sandler and Federal Reserve Funds Held by the City or Managed Under Contract Attachment A is a consolidated report of all City investment funds, including those not held directly in the investment portfolio. These include cash in the City’s regular bank account with US Bank and Wells Fargo. A description of the City’s banking relationships can be found in City Council Staff Report ID # 7858. The bond proceeds, reserves, and debt service payments being held by the City’s fiscal agents are subject to the requirements of the underlying debt indenture. The trustees for the bond funds are U.S. Bank and California Asset Management Program (CAMP). Bond funds with U.S. Bank are invested in federal agency and money market mutual funds that consist exclusively of U.S. Treasury securities. Bond funds in CAMP are invested in banker’s acceptance notes, certificates of deposit, commercial paper, federal agency securities, and repurchase agreements. The most recent data on funds held by the fiscal agent is as of June 30, 2020. In January 2017, the City established a Section 115 Irrevocable Trust (Public Agencies Post- Employment Benefits Trust) administered by Public Agency Retirement Services (PARS). This fund is not governed by the City’s Investment Policy; however, it is discussed in this report for administrative ease. It is the City’s intent to prefund pension costs and began to address the Net Pension Liabilities (NPL) as calculated by Governmental Accounting Standards Board Pronouncement No. 68 (GASB 68). The Section 115 Trust offered by PARS has five portfolios from which to choose in making investments of City funds. The City has selected the “Moderately Conservative” portfolio which is the second most conservative. Additional information on this trust can be found in City Council Staff Report ID # 7553. Through June 30, 2020, principal investment contributions of $27.25 million have grown to $28.69 million and the net return for one and three year has been 6.11 percent and 4.74 percent. City of Palo Alto Page 7 Resource Impact This is an information report. Environmental Review This information report is not a project under the California Environmental Quality Act; therefore, an environmental review is not required. Attachments: • Attachment A: Consolidated Report of Cash Management • Attachment B: Investment Portfolio • Attachment C: Investment Policy Compliance Book Value Market Value City Investment Portfolio (see Attachment B)561,518,261$ 576,605,447$ Other Funds Held by the City Cash with Wells Fargo Bank 543,550 543,550 (includes general and imprest accounts) Cash with US Bank 3,461,689 3,461,689 (includes general and imprest accounts) Petty/Working Cash 12,478 12,478 Total - Other Funds Held By City 4,017,717 4,017,717 Funds Under Management of Third Party Trustees * Debt Service Proceeds US Bank Trust Services **1995 Utility Revenue BondsDebt Service Fund 5 5 1999 Utility Revenue Bonds Debt Service Fund 2 2 2007 Utility Revenue Bonds Debt Service Fund 15 15 2009 Water Revenue Bonds (Build America Bonds) Debt Service and Reserve Funds 2,598,261 2,598,261 2010 General Obligation (Library) Bond Debt Service and Escrow Funds 2,355,180 2,355,180 2011 Utility Revenue Refunding BondsDebt Service and Reserve Funds 1,461,037 1,461,037 2012 University Ave. Parking Refunding BondsReserve and Escrow Funds 1,785,985 1,785,985 2013 General Obligation (Library) BondEscrow Funds 3,061,560 3,061,560 2018 Capital Improvement (Golf Course & 2002B COP Refinance) (Taxable- Green Bond) Certificates of Participation Debt Service and Cost of Issuance Funds 17,994 17,994 2019 California Avenue Parking Garage Certificates of Participation (Tax-Exempt and Taxable Bonds) Construction and Cost of Issuance Funds 13,012,650 13,012,650 California Asset Management Program (CAMP) *** 2012 University Ave. Parking Refunding BondsReserve Fund 2,701,152 2,701,152 2013 General Obligation (Library) BondReserve Fund 597,817 597,817 Public Agencies Post-Employment Benefits Trust **** Public Agency Retirement Services (PARS) (As of Nov. 2019) 28,693,226 28,693,226 Total Under Trustee Management 56,284,884 56,284,884 GRAND TOTAL 621,820,862$ 636,908,048$ * These funds are subject to the requirements of the underlying debt indenture. ** U.S. Bank investments are in money market mutual funds that exclusively invest in U.S. Treasury securities. *** CAMP investments are in money market mutual fund which invest in bankers acceptance, certificate of deposit, commercial paper, federal agency securities, and repurchase agreements. **** PARS investments are in moderately conservative index plus funds Fourth Quarter, Fiscal Year 2019-20 (Unaudited) Consolidated Report of Cash Management City of Palo Alto Cash and Investments Attachment A City of Palo Alto City of Palo AltoAdministration Svcs. Dept. 250 Hamilton Ave., 4th Floor Palo Alto, CA 94301 (650)329-2362 June 30, 2020 Fund ALL - Portfolio Listings Investments by Fund Par Value Days To Maturity Maturity Date Current RateMarket ValueCUSIPInvestment # Issuer Purchase Date Book Value YTM 360 YTM 365 LAIF & Fidelity Cash Accounts Fidelity Investments158 20,410,874.17SYS158 10.06007/01/2018 20,410,874.17 0.059 0.06020,410,874.17 Local Agency Investment Fund159 74,981,193.68SYS159 11.08007/01/2018 75,542,129.11 1.065 1.08074,981,193.68 Subtotal and Average 95,392,067.85 95,392,067.85 95,953,003.28 0.850 0.862 1 Negotiable Certificates of Deposits Comenity Capital Bank1959 NCD 245,000.0020033AM86 10/30/2023 1,2163.45010/30/2018 270,014.50 3.404 3.451245,000.00 American Federal Bank1476 NCD 245,000.0002600ADE4 09/30/2022 8212.45009/30/2015 257,137.30 2.418 2.451245,000.00 Allegiance Bank - Texas1844 NCD 245,000.0001748DAW6 09/29/2022 8202.05009/29/2017 254,927.40 2.022 2.051245,000.00 Alpine Bank1525 NCD 245,000.0002082CBG4 08/16/2023 1,1412.40002/16/2016 245,712.95 2.367 2.400245,000.00 American City Bank1692 NCD 245,000.00025140BC7 03/30/2021 2721.45009/30/2016 247,322.60 1.429 1.449245,000.00 American Eagle Bank2124 NCD 249,000.0002554BCN9 05/23/2022 6912.10009/27/2019 257,916.69 1.869 1.895249,939.31 American National Bank1766 NCD 245,000.0002772JAC4 08/04/2021 3992.05004/04/2017 250,047.00 2.023 2.051245,000.00 Aneca Federal Credit Union2298 NCD 249,000.00034577AN6 03/20/2025 1,7231.10003/20/2020 254,575.11 1.085 1.100249,000.00 American State Bank OSCE1805 NCD 245,000.00029733BX9 05/30/2024 1,4292.30005/30/2017 262,637.55 2.270 2.301245,000.00 American Express Centurion Bk1986 NCD 245,000.0002589AA28 12/04/2023 1,2513.55012/04/2018 271,462.45 3.501 3.550245,000.00 Bankers Bank1776 NCD 245,000.0006610RAM1 04/19/2021 2921.90004/19/2017 248,459.40 1.875 1.901245,000.00 Bank of Wisconsin Dells1696 NCD 245,000.00065847DH5 10/12/2021 4681.50010/12/2016 245,962.85 1.480 1.500245,000.00 Texas Exchange Bank2346 NCD 249,000.0088241THJ2 06/13/2025 1,8081.00006/02/2020 249,393.42 0.986 1.000249,000.00 Bank of Deerfield1396 NCD 245,000.00061785CM1 09/30/2020 912.20009/30/2014 246,271.55 2.171 2.201245,000.00 Bank West1472 NCD 245,000.00063615AX6 09/16/2022 8072.25009/16/2015 255,870.65 2.220 2.251245,000.00 Apex Bank1693 NCD 245,000.0003753XAN0 09/30/2022 8211.70009/30/2016 253,013.95 1.676 1.700245,000.00 Century Next Bank2074 NCD 245,000.00156634AY3 08/30/2024 1,5211.70008/30/2019 257,178.95 1.678 1.701245,000.00 BMO Harris Bank1783 NCD 245,000.0005581WNY7 10/28/2022 8492.25004/28/2017 245,387.10 2.220 2.251245,000.00 Beneficial Bank1680 NCD 245,000.0008173QBR6 09/13/2021 4391.50009/12/2016 248,836.70 1.479 1.500245,000.00 BankFirst1767 NCD 245,000.0006644QAA9 04/13/2022 6512.00004/13/2017 252,849.80 1.973 2.001245,000.00 Bofi Federal Bank1382 NCD 100,000.0009710LAE5 08/08/2022 7682.35008/25/2014 100,228.00 2.592 2.62899,471.26 Banco Poplar North America1478 NCD 245,000.0005965GVP8 10/07/2020 982.25010/07/2015 246,433.25 2.219 2.250245,000.00 Balboa Thrift & Loan1984 NCD 245,000.0005765LAW7 11/30/2022 8823.25011/30/2018 262,640.00 3.207 3.252245,000.00 Business Bank1531 NCD 245,000.0012325EHA3 02/10/2021 2241.55002/10/2016 247,126.60 1.530 1.551245,000.00 Citigroup1950 NCD 245,000.0017312QJ67 04/22/2023 1,0253.00004/24/2018 263,536.70245,000.00 Encore Bank2343 NCD 249,000.0029260MBH7 05/21/2027 2,5151.15005/21/2020 255,628.38 1.134 1.150249,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 Attachment B June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 2 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits Commercial Bank - Alma1772 NCD 245,000.00201282HM5 04/21/2022 6592.05004/21/2017 253,163.40 2.023 2.051245,000.00 CBC National Bank1571 NCD 245,000.0012480LDV6 04/15/2021 2881.50004/15/2016 247,655.80 1.479 1.500245,000.00 Coastal Cummunity & Tech Credi2204 NCD 245,000.0019043TAD7 01/17/2023 9301.90001/16/2020 255,101.35 1.907 1.934244,792.30 Celtic Bank2063 NCD 245,000.0015118RRH2 08/30/2024 1,5211.85008/30/2019 258,695.50 1.826 1.852245,000.00 Central State Bank1538 NCD 245,000.0015524EAA2 02/16/2022 5951.70002/16/2016 250,995.15 1.678 1.701245,000.00 Central State Bank IOWA2324 NCD 249,000.0015523RCP9 03/27/2025 1,7301.00003/27/2020 253,384.89 1.189 1.206246,640.91 First Iowa State Bank1840 NCD 245,000.00320636AC7 01/31/2022 5791.90007/31/2017 251,624.80 1.876 1.902245,000.00 Choice Bank - Oshkosh WI1884 NCD 245,000.0017037VBT8 12/29/2022 9112.35012/29/2017 257,683.65 2.317 2.350245,000.00 Citizens Deposit Bank1677 NCD 245,000.0017453FBP6 08/24/2021 4191.40008/24/2016 248,613.75 1.380 1.400245,000.00 Citadel Federal Credit Union2267 NCD 245,000.0017286TAG0 02/27/2025 1,7021.65002/27/2020 256,752.65 1.668 1.691244,543.52 Citizens State Bank1541 NCD 250,000.0017670BAQ1 02/17/2023 9611.75002/19/2016 259,605.00 1.727 1.751250,000.00 Commercial Savings Bank1868 NCD 245,000.00202291AD2 10/18/2022 8392.10010/18/2017 255,427.20 2.071 2.100245,000.00 Enerbank USA2215 NCD 245,000.0029278TMR8 01/29/2025 1,6731.80001/29/2020 258,428.45 1.779 1.803245,000.00 City National Bk of Metropolis1791 NCD 245,000.0017801GBQ1 05/16/2022 6842.00005/15/2017 253,229.55 1.972 2.000245,000.00 Capital One Bank USA NA1457 NCD 245,000.0014042E5M8 08/12/2020 422.30008/12/2015 245,641.90 2.268 2.300245,000.00 Capital One Bank USA NA2089 NCD 245,000.0014042TCP0 09/05/2024 1,5271.90009/05/2019 259,202.65 1.873 1.900245,000.00 Community Bank Pasadena1627 NCD 245,000.00203507BA5 06/15/2021 3491.55006/16/2016 248,385.90 1.529 1.550245,000.00 Commuincity Finl Svcs Bank1530 NCD 245,000.0020364ABA2 02/17/2021 2311.60002/17/2016 247,268.70 1.579 1.601245,000.00 Commerce State Bank1797 NCD 245,000.0020070PJA6 05/23/2022 6912.00005/22/2017 253,310.40 1.972 2.000245,000.00 Community State Bank, IA1471 NCD 245,000.0020404MAN1 09/12/2022 8032.25009/11/2015 255,821.65 2.224 2.255245,000.00 Congressional Bank2251 NCD 245,000.0020726ABK3 02/28/2025 1,7031.75002/28/2020 245,644.35 1.777 1.802244,429.07 Crescent Bank & Trust2296 NCD 248,000.00225645DN7 03/20/2025 1,7231.10003/20/2020 253,552.72 1.085 1.100248,000.00 Dairy State Bank2252 NCD 245,000.00233863AB5 02/28/2025 1,7031.70002/28/2020 245,301.35 1.748 1.773244,200.70 Discover Bank / Delaware1956 NCD 245,000.00254673VJ2 10/24/2023 1,2103.35010/24/2018 269,100.65 3.304 3.350245,000.00 Dollar Bank FSB1756 NCD 245,000.0025665QAV7 03/08/2022 6152.05003/08/2017 252,673.40 2.021 2.050245,000.00 East Boston Savings Bank1463 NCD 245,000.0027113PAL5 08/24/2020 541.90008/24/2015 245,661.50 1.876 1.902245,000.00 Eagle Bank2040 NCD 245,000.0027002YEL6 04/28/2023 1,0312.65004/30/2019 261,177.35 2.615 2.651245,000.00 Ever Bank1454 NCD 245,000.0029976DZK9 07/30/2020 292.00007/30/2015 245,384.65 1.972 2.000245,000.00 Farmer's and Merchants Bank1360 NCD 250,000.00308702BQ1 02/16/2021 2302.20008/15/2014 253,247.50 2.169 2.200250,000.00 FirstBank Puerto Rico1768 NCD 245,000.0033767A2C4 04/07/2022 6452.10004/07/2017 253,214.85 2.072 2.101245,000.00 Poppy Bank2285 NCD 249,000.0073319FAF6 03/18/2025 1,7211.10003/18/2020 254,585.07 1.085 1.100249,000.00 First Federal S&L Bank1626 NCD 245,000.0032018YAW8 06/22/2023 1,0861.80006/22/2016 256,461.10 1.776 1.800245,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 3 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits First Farmers Bank & Trust2076 NCD 245,000.00320165JK0 09/04/2024 1,5261.75009/04/2019 257,678.75 1.727 1.751245,000.00 First Internet Bank1834 NCD 245,000.0032056GCQ1 07/14/2022 7432.05007/14/2017 254,128.70 2.023 2.051245,000.00 First Eagle National Bank1400 NCD 245,000.0032008JAG8 10/15/2021 4712.45010/17/2014 252,991.90 2.416 2.449245,000.00 First Oklahoma Bank1838 NCD 245,000.00335857BF4 07/26/2022 7552.10007/26/2017 245,350.35 2.072 2.101245,000.00 Farmers & Merchant Bank1735 NCD 245,000.0030781TBD9 01/18/2022 5662.05001/18/2017 252,048.65 2.021 2.050245,000.00 First National Bank of America1391 NCD 240,000.0032110YEF8 08/03/2022 7632.35009/09/2014 240,472.80 2.665 2.703238,413.17 FNB Bank Inc.1863 NCD 245,000.00330459CB2 10/13/2023 1,1992.25010/13/2017 260,092.00 2.220 2.251245,000.00 The FNB of Mcgregor1480 NCD 245,000.0032112UBW0 09/30/2021 4562.00010/01/2015 250,583.55 1.972 1.999245,000.00 First Premier Bank1255 NCD 245,000.0033610RNX7 03/08/2021 2502.50003/07/2014 249,025.35 2.465 2.500245,000.00 Franklin Synergy Bank1771 NCD 103,000.0035471TCV2 01/31/2022 5792.00004/04/2017 105,948.89 1.972 1.999103,000.00 Frontier Bank IA2274 NCD 249,000.00359067DE2 03/13/2025 1,7161.70003/13/2020 249,473.10 1.697 1.720248,766.00 Community First Bank1555 NCD 250,000.0020369JAA9 03/17/2022 6241.70003/17/2016 250,187.50 1.677 1.700250,000.00 Farmer's & Merchant's SVG Bank1551 NCD 245,000.00308863AH2 02/26/2021 2401.55002/29/2016 247,984.10 1.528 1.550245,000.00 First Neighbor Bank, NA1469 NCD 245,000.0033581VAF6 09/03/2021 4292.40009/03/2015 251,735.05 2.367 2.400245,000.00 First Savings Bank Northwest2337 NCD 249,000.0032022MBX5 04/15/2025 1,7491.50004/15/2020 249,144.42 1.480 1.500249,000.00 First National Bank of Elkhart1801 NCD 245,000.00321130AB2 05/31/2022 6992.10005/31/2017 245,404.25 2.072 2.101245,000.00 First Northeast Bank1779 NCD 245,000.0033583FAA0 10/19/2022 8402.10004/19/2017 255,414.95 2.072 2.101245,000.00 First State Bank - Dequeen1824 NCD 245,000.00336460CH1 04/29/2022 6672.00006/30/2017 253,045.80 1.973 2.000245,000.00 First Technology Federal Credi1955 NCD 245,000.0033715LCM0 10/17/2023 1,2033.40010/17/2018 269,362.80 3.355 3.401245,000.00 Firstier Bank2061 NCD 245,000.0033766LAJ7 08/23/2024 1,5141.95008/23/2019 259,673.05 1.925 1.952245,000.00 First Kentucky Bank1856 NCD 245,000.0032065TAW1 10/06/2022 8272.10010/06/2017 255,277.75 2.072 2.101245,000.00 First Western Bank & Trust1770 NCD 245,000.0033749VAM0 04/07/2022 6452.00004/07/2017 252,781.20 1.973 2.001245,000.00 GE Capital Bank1262 NCD 245,000.0036157PXV6 03/22/2021 2642.65003/21/2014 249,517.80 2.613 2.650245,000.00 Ally Bank1882 NCD 245,000.0002007GAF0 01/04/2021 1872.25001/04/2018 247,658.25 2.219 2.250245,000.00 Great Plains Bank1865 NCD 245,000.0039115UBB8 07/25/2022 7542.00010/25/2017 253,993.95 1.972 2.000245,000.00 Grant County Bank1864 NCD 175,000.0038762PCB6 10/18/2023 1,2042.20010/18/2017 175,182.00 2.170 2.201175,000.00 Grant County Bank West V.2042 NCD 245,000.00387625AA4 05/08/2024 1,4072.55005/08/2019 264,771.50 2.513 2.548245,000.00 Goldman Sachs Bank USA / NY1951 NCD 245,000.0038148PJ81 05/09/2023 1,0423.15005/09/2018 264,842.55 3.106 3.150245,000.00 Great Southern Bank2250 NCD 245,000.0039120VSS4 08/21/2023 1,1461.70002/21/2020 245,551.25 1.734 1.758244,560.27 Investors Community Bank1765 NCD 245,000.0046147USQ4 09/23/2022 8142.20003/24/2017 255,694.25 2.172 2.202245,000.00 Industrial & Com Bk of China1773 NCD 245,000.0045581EAC5 04/12/2022 6502.15004/12/2017 253,491.70 2.121 2.151245,000.00 Investors Bank1460 NCD 245,000.0046176PEJ0 08/25/2020 552.00008/25/2015 245,837.90 1.972 2.000245,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 4 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits Inst. for Sav in Newburyport1455 NCD 245,000.0045780PAN5 07/30/2021 3942.30007/31/2015 251,078.45 2.269 2.301245,000.00 Iowa Trust & Savings Bank2270 NCD 245,000.00462595BE8 02/28/2025 1,7031.70002/28/2020 245,301.35 1.717 1.741244,543.26 JP Morgan Chase BAnk NA2218 NCD 245,000.0048128LD48 01/31/2030 3,5012.50001/31/2020 248,371.20 2.465 2.500245,000.00 Kansas State Bank Manhattan1798 NCD 245,000.0050116CAX7 05/31/2024 1,4302.50005/31/2017 264,536.30 2.465 2.500245,000.00 Keesler Federal Credit Union2027 NCD 245,000.0049254FAP1 08/30/2021 4253.05002/28/2019 253,224.65 3.008 3.050245,000.00 Knox TVA Empl Credit Union2140 NCD 248,000.00499724AF9 10/31/2023 1,2173.35010/24/2019 272,494.96 2.210 2.241256,758.42 Kern Schools Fed. Credit Unio2160 NCD 250,000.0049228XAG5 12/04/2024 1,6172.10012/04/2019 250,890.00 2.073 2.102250,000.00 Lakeside Bank1686 NCD 245,000.0051210SLR6 09/18/2023 1,1741.80009/16/2016 245,879.55 1.775 1.800245,000.00 Legends Bank1533 NCD 245,000.0052465JGM3 02/11/2022 5901.70002/12/2016 253,614.20 1.678 1.701245,000.00 Live Oak Banking Company1671 NCD 245,000.00538036CH5 08/19/2021 4141.40008/19/2016 248,594.15 1.381 1.400245,000.00 Luana Savings Bank1367 NCD 245,000.00549103QA0 09/07/2021 4332.25009/05/2014 251,061.30 2.219 2.250245,000.00 Bank Leumi USA NY2335 NCD 249,000.00063248KR8 03/31/2023 1,0031.45003/31/2020 256,865.91 1.430 1.449249,000.00 Marathon Savings Bank1818 NCD 245,000.0056585YAA8 06/28/2022 7272.05006/28/2017 253,952.30 2.023 2.051245,000.00 MB Financial Bank NA1730 NCD 245,000.0055266CUF1 01/13/2022 5612.10001/13/2017 252,178.50 2.072 2.101245,000.00 Mercantile Bank of Michigan1793 NCD 245,000.0058740XZF0 05/12/2022 6802.10005/12/2017 253,675.45 2.071 2.100245,000.00 Mechanics Coop Bank1803 NCD 245,000.00583626AC0 05/26/2022 6942.05005/26/2017 253,577.45 2.023 2.051245,000.00 Medallion Bank - Salt Lake2010 NCD 245,000.0058404DDB4 01/03/2024 1,2813.30001/10/2019 269,806.25 3.254 3.299245,000.00 Landmark Community Bank2123 NCD 249,000.0051507LBU7 06/27/2022 7262.35009/27/2019 259,572.54 1.868 1.894251,196.66 Merchants State Bank2059 NCD 245,000.00589227AG2 08/30/2024 1,5211.80008/30/2019 258,176.10 1.775 1.800245,000.00 Merrick Bank1464 NCD 245,000.0059013JHE2 08/20/2020 501.90008/20/2015 245,610.05 1.876 1.902245,000.00 Merchants National Bank OH1534 NCD 245,000.00588806AV1 02/17/2022 5961.80002/17/2016 253,432.90 1.776 1.801245,000.00 Mid-Missouri Bank1806 NCD 245,000.0059541KBL0 06/10/2022 7092.05006/12/2017 253,753.85 2.023 2.051245,000.00 Maine Savings Credit Union2144 NCD 245,000.00560507AN5 11/08/2024 1,5911.90011/08/2019 259,364.35 1.875 1.902245,000.00 Mainstreet Bank2038 NCD 245,000.0056065GAG3 04/26/2024 1,3952.60004/26/2019 265,107.15 2.567 2.602245,000.00 Mountain America FD Credit Uni2202 NCD 249,000.0062384RAC0 11/08/2022 8602.30001/08/2020 260,961.96 1.928 1.955250,965.54 Marlin Business Bank1483 NCD 245,000.0057116AKU1 10/21/2020 1121.75010/21/2015 246,607.20 1.727 1.751245,000.00 Morgan Stanley Bank NA1890 NCD 245,000.0061747MF63 01/11/2023 9242.65001/11/2018 259,670.60 2.613 2.650245,000.00 Morgan Stanley Bank NA1993 NCD 245,000.0061760ASZ3 12/06/2023 1,2533.55012/06/2018 271,499.20 3.501 3.550245,000.00 Municipal Trust and Savings1800 NCD 245,000.00625925AP7 05/02/2024 1,4012.35005/22/2017 262,840.90 2.317 2.349245,000.00 MY Safra Bank FSB1467 NCD 245,000.0055406JAL6 09/03/2020 641.90009/03/2015 245,977.55 1.873 1.900245,000.00 Nebraska State Bank & Trust1466 NCD 245,000.0063969ABL7 08/26/2022 7862.25008/26/2015 258,068.30 2.220 2.251245,000.00 Numerica Credit Union1991 NCD 245,000.0067054NAN3 11/28/2023 1,2453.55011/28/2018 271,313.00 3.503 3.551245,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 5 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits Oostburg State Bank1532 NCD 245,000.00683430BU5 02/09/2021 2231.55002/09/2016 247,942.45 1.530 1.551245,000.00 South Ottumwa Savings Bank1851 NCD 245,000.00839145AA7 09/29/2022 8202.05009/29/2017 254,927.40 2.022 2.051245,000.00 Ottawa Savings Bank1892 NCD 245,000.0068956HAC7 01/19/2023 9322.40001/19/2018 258,234.90 2.368 2.401245,000.00 Pathfinder Bank2260 NCD 245,000.0070320KAE1 03/06/2025 1,7091.80003/06/2020 258,455.40 1.816 1.841244,541.40 Ponce De Leon Federal Bank1795 NCD 245,000.00732333AH2 05/26/2022 6942.10005/26/2017 253,810.20 2.072 2.101245,000.00 Preferred Bank LA California2047 NCD 245,000.00740367HP5 08/16/2024 1,5072.00008/16/2019 260,148.35 1.972 2.000245,000.00 Parkside Financial Bank1833 NCD 245,000.0070147ACE2 03/15/2023 9872.10007/19/2017 256,916.80 2.072 2.101245,000.00 Providence Bank1445 NCD 245,000.00743738BQ8 02/25/2022 6042.10002/26/2015 255,027.85 2.072 2.101245,000.00 Rayond James Bank NA2188 NCD 245,000.0075472RAU5 12/30/2024 1,6431.85012/30/2019 258,977.25 1.824 1.850245,000.00 Reliance Savings Bank1636 NCD 245,000.0075950XAD1 06/22/2021 3561.45006/22/2016 248,452.05 1.430 1.450245,000.00 Sallie Mae Bank2102 NCD 245,000.007954504D4 09/18/2024 1,5401.90009/18/2019 259,241.85 1.873 1.900245,000.00 Stifel Bank & Trust1953 NCD 245,000.0086063QAK1 05/15/2023 1,0482.95005/15/2018 263,497.50 2.911 2.951245,000.00 San Francisco Credit Union2297 NCD 249,000.0079772FAF3 03/27/2025 1,7301.10003/27/2020 254,547.72 1.085 1.100249,000.00 Summit Community Bank1888 NCD 245,000.0086604XMN3 01/26/2022 5742.25001/26/2018 252,915.95 2.220 2.251245,000.00 Somerset Trust Company Bank1616 NCD 245,000.00835104BL3 06/12/2023 1,0761.80006/10/2016 256,377.80 1.776 1.800245,000.00 Bank of New England1704 NCD 245,000.00063847AW7 10/19/2021 4751.50010/19/2016 249,057.20 1.480 1.500245,000.00 Southwest 66 Credit Union Bank2286 NCD 249,000.0084475BAB1 03/24/2025 1,7271.30003/23/2020 251,131.44 1.282 1.300249,000.00 Slovak Savings Bank1872 NCD 245,000.0083158TAA0 10/20/2022 8412.10010/20/2017 255,427.20 2.072 2.101245,000.00 Security Bank1777 NCD 245,000.00814107AQ1 04/19/2022 6572.00004/19/2017 252,918.40 1.973 2.001245,000.00 SunTrust Bank2125 NCD 245,000.0086789VZY6 09/26/2024 1,5482.00009/30/2019 246,082.90 1.974 2.002245,000.00 ST Mary's Credit Union2261 NCD 249,000.0079257QAC0 02/27/2025 1,7021.75002/27/2020 249,644.91 1.777 1.802248,420.09 Southwest Financial Fed. Credi2333 NCD 249,000.0084485EAG2 03/28/2024 1,3661.15003/31/2020 255,713.04 1.134 1.150249,000.00 Third Federal Savings and Loan2157 NCD 245,000.0088413QCK2 11/25/2024 1,6081.95011/25/2019 259,947.45 1.923 1.950245,000.00 Thomasville Natl Bank1266 NCD 245,000.00884693BJ0 04/12/2021 2852.40004/11/2014 249,821.60 2.367 2.400245,000.00 Crossfirst Bank of Leawood1804 NCD 245,000.0022766ABF1 06/09/2023 1,0732.15006/09/2017 258,129.55 2.121 2.151245,000.00 Toyota Financial Savings Bank1740 NCD 245,000.0089235MHU8 02/12/2024 1,3212.65002/10/2017 245,668.85245,000.00 Traverse City State Bank1820 NCD 245,000.00894333FF5 06/28/2022 7272.00006/28/2017 253,741.60 1.972 2.000245,000.00 UBS Bank USA1815 NCD 250,000.0090348JBR0 01/20/2022 5682.25006/15/2017 257,997.50 2.219 2.249250,000.00 United Community Bank GA1749 NCD 245,000.0090984P5A9 03/01/2022 6082.05003/01/2017 252,590.10 2.021 2.050245,000.00 Uinta Bank1639 NCD 245,000.00903572BC8 12/26/2023 1,2731.70006/24/2016 258,323.10 1.676 1.700245,000.00 Unity Bank1529 NCD 245,000.0091330ABF3 02/26/2021 2401.60002/26/2016 248,182.55 1.579 1.601245,000.00 USAlliance Federal Credit Unio2325 NCD 249,000.0090352RAU9 03/31/2025 1,7341.15003/31/2020 255,698.10 1.154 1.170248,763.55 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 6 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits Vystar Credit Union2136 NCD 245,000.0092891CCE0 12/11/2023 1,2583.65010/18/2019 272,386.10 2.170 2.200256,697.74 Washington Federal2049 NCD 245,000.00938828BJ8 08/23/2024 1,5142.05008/23/2019 260,677.55 2.024 2.052245,000.00 Western State Bank2342 NCD 248,000.0095960NKE6 11/13/2025 1,9611.05005/13/2020 252,607.84 1.035 1.050248,000.00 Washington First Bank1745 NCD 245,000.00940727AH3 02/23/2022 6022.05002/23/2017 252,479.85 2.021 2.050245,000.00 Wells Fargo Bank1656 NCD 245,000.009497486H5 06/30/2021 3641.60006/30/2016 248,523.10 1.578 1.600245,000.00 Woodford State Bank1459 NCD 245,000.00979424AA6 07/29/2022 7582.35008/12/2015 257,399.45 2.317 2.349245,000.00 Washington County Bank1842 NCD 245,000.0093754PAN7 05/11/2022 6792.05008/11/2017 253,401.05 2.021 2.050245,000.00 Subtotal and Average 39,197,643.17 39,181,000.00 40,554,995.26 1.981 2.009 929 Corporate Medium Term Bonds Apple, Inc.1543 MTN 700,000.00037833BS8 02/23/2021 2372.25002/23/2016 707,686.00 2.140 2.169700,335.63 Apple, Inc.2082 MTN 550,000.00037833AK6 05/03/2023 1,0362.40008/29/2019 581,388.50 1.726 1.750559,781.56 Apple, Inc.2323 MTN 750,000.00037833AY6 02/09/2022 5882.15003/19/2020 771,652.50 1.583 1.605756,432.37 Alphabet (Google) Inc.1657 MTN 100,000.0002079KAA5 05/19/2021 3223.62507/11/2016 102,882.00 1.271 1.288101,993.87 Alphabet (Google) Inc.1658 MTN 946,000.0038259PAB8 05/19/2021 3223.62507/11/2016 973,263.72 1.271 1.288964,861.98 Alphabet (Google) Inc.1660 MTN 1,500,000.0002079KAA5 05/19/2021 3223.62507/12/2016 1,543,230.00 1.238 1.2551,530,356.53 Alphabet (Google) Inc.1734 MTN 871,000.0002079KAA5 05/19/2021 3223.62501/11/2017 896,102.22 2.012 2.040882,608.70 Alphabet (Google) Inc.1895 MTN 1,000,000.0002079KAA5 05/19/2021 3223.62501/10/2018 1,028,820.00 2.189 2.2191,011,893.02 Alphabet (Google) Inc.1931 MTN 382,000.0002079KAA5 05/19/2021 3223.62502/14/2018 393,009.24 2.377 2.410385,917.21 Johnson & Johnson1624 MTN 1,000,000.00478160BS2 03/01/2021 2431.65006/07/2016 1,008,200.00 1.530 1.5511,000,616.90 Johnson & Johnson1900 MTN 500,000.00478160BS2 03/01/2021 2431.65001/12/2018 504,100.00 2.179 2.210498,205.15 Microsoft Corporation1496 MTN 2,000,000.00594918BG8 11/03/2020 1252.00011/05/2015 2,008,140.00 1.913 1.9402,000,379.98 Microsoft Corporation1515 MTN 900,000.00594918BG8 11/03/2020 1252.00001/07/2016 903,663.00 1.887 1.913900,250.47 Microsoft Corporation1878 MTN 100,000.00594918BW3 02/06/2022 5852.40012/11/2017 103,191.00 2.292 2.324100,114.23 Microsoft Corporation2212 MTN 1,800,000.00594918BX1 02/06/2024 1,3152.87501/22/2020 1,939,014.00 1.727 1.7511,867,172.56 Stanford University2046 MTN 2,000,000.00525555AB4 02/01/2024 1,3106.87505/14/2019 2,397,980.00 2.367 2.4002,301,435.83 Stanford University2182 MTN 1,000,000.00525555AB4 02/01/2024 1,3106.87512/12/2019 1,198,990.00 1.934 1.9601,168,315.11 Subtotal and Average 16,730,671.10 16,099,000.00 17,061,312.18 1.861 1.887 630 Federal Agency Bonds Apple, Inc.2053 MTN 1,500,000.00037833CU2 05/11/2024 1,4102.85008/06/2019 1,615,380.00 1.998 2.0251,543,766.76 Federal Agricultural Mortgage1130 1,500,000.0031315PPX1 07/05/2022 7342.20012/13/2012 1,558,950.00 1.930 1.9571,506,653.88 Federal Agricultural Mortgage1134 750,000.0031315PB32 11/21/2022 8732.00012/19/2012 780,645.00 2.081 2.110748,228.60 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 7 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Agricultural Mortgage1137 1,500,000.0031315PUE7 12/27/2022 9092.18001/04/2013 1,569,630.00 2.165 2.1961,499,464.72 Federal Agricultural Mortgage1139 500,000.0031315PWN5 06/01/2021 3353.84001/04/2013 515,855.00 1.946 1.973507,847.72 Federal Agricultural Mortgage1141 1,500,000.0031315PUE7 12/27/2022 9092.18001/08/2013 1,569,630.00 2.195 2.2251,498,479.62 Federal Agricultural Mortgage1144 1,500,000.0031315PUE7 12/27/2022 9092.18001/23/2013 1,569,630.00 2.111 2.1411,501,301.13 Federal Agricultural Mortgage1147 2,595,000.0031315PUE7 12/27/2022 9092.18001/28/2013 2,715,459.90 2.199 2.2292,592,113.96 Federal Agricultural Mortgage1244 1,500,000.0031315P3G2 09/09/2020 702.80001/15/2014 1,509,345.00 2.635 2.6721,500,329.35 Federal Agricultural Mortgage1257 300,000.0031315PTU3 03/09/2021 2514.16003/06/2014 308,325.00 2.574 2.609302,910.39 Federal Agricultural Mortgage1264 1,500,000.0031315PK40 03/26/2021 2682.50003/26/2014 1,526,040.00 2.495 2.5301,499,692.41 Federal Agricultural Mortgage1279 1,250,000.0031315PPX1 07/05/2022 7342.20004/23/2014 1,299,125.00 2.889 2.9301,233,785.62 Federal Agricultural Mortgage1427 675,000.0031315P2C2 05/05/2021 3082.51001/09/2015 687,696.75 2.110 2.140676,960.94 Federal Agricultural Mortgage1428 404,000.0031315PL23 03/27/2024 1,3653.33001/09/2015 448,565.24 2.540 2.575414,079.18 Federal Agricultural Mortgage1433 1,604,000.0031315PD89 06/12/2023 1,0762.61001/22/2015 1,710,682.04 2.269 2.3011,617,207.89 Federal Agricultural Mortgage1447 1,450,000.0031315PD89 06/12/2023 1,0762.61002/09/2015 1,546,439.50 2.377 2.4101,457,689.69 Federal Agricultural Mortgage1452 1,000,000.003130H0AJ2 03/01/2022 6082.15003/05/2015 1,029,730.00 2.120 2.1501,000,000.00 Federal Agricultural Mortgage1576 1,000,000.0031315PZS1 01/24/2023 9372.13004/06/2016 1,046,550.00 1.839 1.8641,006,349.02 Federal Agricultural Mortgage1580 474,000.0031315PEM7 08/04/2025 1,8604.35004/08/2016 563,936.76 2.296 2.328517,631.09 Federal Agricultural Mortgage1595 1,500,000.0031315P2J7 05/01/2024 1,4003.30004/21/2016 1,667,670.00 2.084 2.1121,562,472.46 Federal Agricultural Mortgage1604 1,500,000.0031315P2J7 05/01/2024 1,4003.30004/26/2016 1,667,670.00 2.159 2.1891,558,247.00 Federal Agricultural Mortgage1617 500,000.0031315PUE7 12/27/2022 9092.18005/26/2016 523,210.00 1.844 1.870503,605.16 Federal Agricultural Mortgage1665 2,000,000.003132X0BH3 07/15/2022 7442.38007/25/2016 2,086,980.00 1.499 1.5202,033,395.29 Federal Agricultural Mortgage1698 1,500,000.003132X0EQ0 01/25/2021 2081.55010/03/2016 1,511,625.00 1.256 1.2741,502,273.31 Federal Agricultural Mortgage1710 1,500,000.0031315PRA9 02/03/2026 2,0434.81010/18/2016 1,844,595.00 2.131 2.1601,700,207.53 Federal Agricultural Mortgage1755 1,000,000.003132X0PX3 02/23/2022 6022.10002/23/2017 1,028,520.00 2.034 2.0631,000,573.91 Federal Agricultural Mortgage1758 1,500,000.003132X0PX3 02/23/2022 6022.10003/02/2017 1,542,780.00 2.085 2.1141,499,652.93 Federal Agricultural Mortgage1769 1,500,000.003132X0RS2 04/06/2022 6442.07504/06/2017 1,544,880.00 2.046 2.0751,500,000.00 Federal Agricultural Mortgage1781 1,000,000.003132X0QG9 02/22/2021 2361.90004/12/2017 1,011,080.00 1.781 1.8051,000,579.33 Federal Agricultural Mortgage1788 1,000,000.003132X0NZ0 01/03/2022 5512.10005/04/2017 1,026,410.00 1.938 1.9651,001,930.41 Federal Agricultural Mortgage1817 1,000,000.0031315PPX1 07/05/2022 7342.20006/14/2017 1,039,300.00 1.908 1.9341,005,057.27 Federal Agricultural Mortgage1830 1,500,000.003132X0UA7 06/29/2022 7281.88006/29/2017 1,548,960.00 1.903 1.9301,498,575.97 Federal Agricultural Mortgage1831 1,000,000.003132X0UA7 06/29/2022 7281.88006/29/2017 1,032,640.00 1.923 1.949998,676.09 Federal Agricultural Mortgage1867 1,000,000.003132X0WL1 08/23/2024 1,5142.25010/06/2017 1,076,510.00 2.332 2.365995,614.95 Federal Agricultural Mortgage1877 1,500,000.003132X0ZZ7 12/12/2022 8942.26012/12/2017 1,571,535.00 2.229 2.2601,500,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 8 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Agricultural Mortgage1889 2,000,000.003132X0D57 01/08/2021 1912.12001/08/2018 2,020,260.00 2.090 2.1202,000,000.00 Federal Agricultural Mortgage1893 1,000,000.003130H0AU7 08/01/2024 1,4922.62501/09/2018 1,090,840.00 2.546 2.5811,001,611.90 Federal Agricultural Mortgage1901 1,500,000.003130H0AU7 08/01/2024 1,4922.62501/11/2018 1,636,260.00 2.623 2.6601,498,036.62 Federal Agricultural Mortgage1912 2,000,000.003132X0G39 01/30/2023 9432.50001/30/2018 2,112,620.00 2.472 2.5071,999,649.04 Federal Agricultural Mortgage1915 1,500,000.003132X0G39 01/30/2023 9432.50001/30/2018 1,584,465.00 2.481 2.5151,499,425.57 Federal Agricultural Mortgage1921 2,000,000.003132X0G39 01/30/2023 9432.50001/31/2018 2,112,620.00 2.556 2.5921,995,567.64 Federal Agricultural Mortgage1924 1,100,000.0031315PZS1 01/24/2023 9372.13002/08/2018 1,151,205.00 2.578 2.6141,087,266.11 Federal Agricultural Mortgage1927 1,000,000.003132X0H79 02/22/2021 2362.35002/22/2018 1,014,050.00 2.327 2.360999,937.97 Federal Agricultural Mortgage1928 1,500,000.003132X0H87 02/22/2023 9662.60002/22/2018 1,590,180.00 2.564 2.6001,500,000.00 Federal Agricultural Mortgage1936 1,500,000.003132X0L33 02/21/2023 9652.77002/23/2018 1,596,795.00 2.732 2.7701,500,000.00 Federal Agricultural Mortgage1999 549,000.0031315P4B2 01/30/2024 1,3083.46012/14/2018 609,686.46 3.018 3.060556,216.54 Federal Agricultural Mortgage2034 1,000,000.0031422BEJ5 04/09/2024 1,3782.35004/09/2019 1,074,520.00 2.365 2.398998,287.41 Federal Agricultural Mortgage2035 678,000.0031315PCY3 11/20/2024 1,6035.25004/08/2019 820,400.34 2.420 2.454755,210.71 Federal Agricultural Mortgage2098 550,000.0031315PEM7 08/04/2025 1,8604.35009/09/2019 654,357.00 1.659 1.683620,807.24 Federal Agricultural Mortgage2174 Call 2,000,000.0031422BQN3 12/10/2029 3,4492.69012/10/2019 2,010,960.00 2.653 2.6902,000,000.00 Federal Agricultural Mortgage2186 Call 1,350,000.0031422BQN3 12/10/2029 3,4492.69012/13/2019 1,357,398.00 2.678 2.7151,347,193.49 Federal Agricultural Mortgage2194 Call 1,450,000.0031422BRN2 12/25/2029 3,4642.82012/30/2019 1,458,888.50 2.781 2.8201,450,000.00 Federal Agricultural Mortgage2209 Call 1,000,000.0031422BSR2 01/15/2030 3,4852.70001/15/2020 1,000,430.00 2.663 2.7001,000,000.00 Federal Agricultural Mortgage2240 Call 1,000,000.0031422BUA6 02/11/2025 1,6861.85002/11/2020 1,001,340.00 1.824 1.8501,000,000.00 Federal Agricultural Mortgage2242 Call 2,000,000.0031422BUC2 02/11/2030 3,5122.45002/11/2020 2,011,640.00 2.416 2.4502,000,000.00 Federal Agricultural Mortgage2301 1,569,000.0031315PB99 11/19/2027 2,6972.85003/11/2020 1,792,660.95 1.050 1.0641,767,044.37 Federal Agricultural Mortgage2304 Call 2,000,000.0031422BWK2 03/18/2030 3,5471.75003/18/2020 2,002,040.00 1.726 1.7502,000,000.00 Federal Agricultural Mortgage2330 Call 2,000,000.0031422BWY2 03/24/2025 1,7271.40003/24/2020 2,003,340.00 1.380 1.4002,000,000.00 Federal Agricultural Mortgage2340 Call 2,000,000.0031422BZS2 05/13/2030 3,6031.50005/13/2020 1,995,760.00 1.479 1.5002,000,000.00 Federal Agricultural Mortgage2366 Call 1,750,000.0031422BF54 06/24/2030 3,6451.40006/24/2020 1,750,175.00 1.380 1.4001,750,000.00 Federal Agricultural Mortgage2367 Call 2,000,000.0031422BF54 06/24/2030 3,6451.40006/24/2020 2,000,200.00 1.380 1.4002,000,000.00 Federal Farm Credit Bank903 1,000,000.0031331JN90 09/29/2020 902.87509/29/2010 1,007,540.00 2.835 2.8751,000,000.00 Federal Farm Credit Bank .1241 500,000.003133ECRH9 06/06/2023 1,0702.45001/09/2014 531,205.00 3.383 3.430487,811.59 Federal Farm Credit Bank .1526 625,000.003133EAA65 07/26/2023 1,1202.12501/27/2016 659,506.25 2.024 2.052626,289.64 Federal Farm Credit Bank .1563 500,000.0031331XSS2 03/14/2022 6215.16003/17/2016 541,975.00 1.876 1.902526,093.14 Federal Farm Credit Bank .1593 250,000.003133EC4L5 11/23/2021 5101.61004/21/2016 254,897.50 1.558 1.580250,099.18 Federal Farm Credit Bank .1596 1,000,000.003133ECPF5 05/13/2022 6811.87504/21/2016 1,030,250.00 1.578 1.6001,004,872.15 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 9 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Farm Credit Bank .1615 1,000,000.003133EC7D0 12/13/2024 1,6262.12505/13/2016 1,074,550.00 1.930 1.9561,006,853.86 Federal Farm Credit Bank .1650 1,500,000.003133EGKM6 07/06/2020 51.00007/06/2016 1,500,360.00 0.986 1.0001,500,000.00 Federal Farm Credit Bank .1659 500,000.0031331XSS2 03/14/2022 6215.16007/08/2016 541,975.00 1.215 1.232532,198.98 Federal Farm Credit Bank .1782 500,000.0031331XHX3 12/21/2021 5385.05004/12/2017 535,620.00 1.884 1.910522,001.90 Federal Farm Credit Bank .1787 900,000.003133EEVD9 03/25/2024 1,3632.30005/04/2017 965,070.00 2.274 2.306899,800.11 Federal Farm Credit Bank .1822 500,000.003133EDWX6 10/07/2024 1,5592.91006/21/2017 552,800.00 2.143 2.172514,462.15 Federal Farm Credit Bank .1843 445,000.003133ED6R8 11/07/2022 8592.93009/14/2017 472,647.85 1.870 1.896455,243.72 Federal Farm Credit Bank .1885 600,000.003133EC2B9 11/09/2021 4961.70012/29/2017 612,198.00 2.161 2.191596,187.28 Federal Farm Credit Bank .1932 1,500,000.003133EJDE6 02/16/2023 9602.57002/16/2018 1,589,220.00 2.605 2.6421,497,360.55 Federal Farm Credit Bank .2004 1,500,000.003133EJ2R9 12/14/2020 1662.75012/20/2018 1,517,400.00 2.663 2.7001,500,325.32 Federal Farm Credit Bank .2016 500,000.003133EEG79 09/07/2023 1,1632.15001/15/2019 528,915.00 2.656 2.693491,911.17 Federal Farm Credit Bank .2017 650,000.003133EC2C7 11/09/2023 1,2262.13001/15/2019 688,980.50 2.662 2.699638,417.17 Federal Farm Credit Bank .2118 Call 1,000,000.003133EKZW9 08/19/2027 2,6052.37009/18/2019 1,001,470.00 2.389 2.422996,622.24 Federal Farm Credit Bank .2226 Call 1,000,000.003133ELJU9 01/27/2026 2,0361.98001/29/2020 1,018,130.00 1.955 1.982999,860.57 Federal Farm Credit Bank .2259 Call 1,350,000.003133EKVQ6 07/19/2024 1,4792.04002/19/2020 1,371,910.50 1.868 1.8941,357,588.48 Federal Farm Credit Bank .2280 Call 1,000,000.003133ELPS7 03/04/2030 3,5332.24003/04/2020 1,005,720.00 2.142 2.1721,005,830.15 Federal Farm Credit Bank .2289 Call 1,500,000.003133ELSD7 03/11/2030 3,5401.85003/11/2020 1,509,990.00 1.824 1.8501,500,000.00 Federal Farm Credit Bank .2292 Call 1,500,000.003133ELSD7 03/11/2030 3,5401.85003/11/2020 1,509,990.00 1.824 1.8501,500,000.00 Federal Farm Credit Bank .2314 1,000,000.003133EAG44 08/03/2026 2,2242.63003/13/2020 1,123,780.00 1.089 1.1041,089,433.60 Federal Farm Credit Bank .2344 Call 1,000,000.003133ELA79 08/26/2027 2,6121.12005/26/2020 1,000,010.00 1.104 1.1201,000,000.00 Federal Farm Credit Bank .2348 Call 1,000,000.003133ELB37 11/27/2028 3,0711.35005/27/2020 1,000,130.00 1.331 1.3501,000,000.00 Federal Farm Credit Bank .2349 Call 1,000,000.003133ELC44 06/01/2029 3,2571.37006/01/2020 1,000,520.00 1.351 1.3701,000,000.00 Federal Farm Credit Bank .2350 Call 1,000,000.003133ELB78 05/28/2030 3,6181.57005/28/2020 1,000,150.00 1.548 1.5701,000,000.00 Federal Farm Credit Bank .2351 Call 1,000,000.003133ELSD7 03/11/2030 3,5401.85005/20/2020 1,006,660.00 1.749 1.7731,006,740.81 Federal Farm Credit Bank .2352 Call 1,500,000.003133ELB78 05/28/2030 3,6181.57005/28/2020 1,500,225.00 1.548 1.5701,500,000.00 Federal Farm Credit Bank .2353 Call 1,250,000.003133ELC44 06/01/2029 3,2571.37006/01/2020 1,250,650.00 1.357 1.3751,249,380.79 Federal Farm Credit Bank .2354 Call 1,500,000.003133ELB78 05/28/2030 3,6181.57006/02/2020 1,500,225.00 1.553 1.5751,499,256.05 Federal Farm Credit Bank .2355 Call 1,500,000.003133ELB78 05/28/2030 3,6181.57006/03/2020 1,500,225.00 1.561 1.5831,498,139.60 Federal Farm Credit Bank .2356 Call 1,500,000.003133ELH49 06/11/2030 3,6321.55006/11/2020 1,500,075.00 1.528 1.5501,500,000.00 Federal Farm Credit Bank .2357 Call 1,000,000.003133ELC69 12/01/2027 2,7091.18006/03/2020 1,000,010.00 1.167 1.183999,752.59 Federal Farm Credit Bank .2359 Call 2,000,000.003133ELYW8 05/11/2029 3,2361.49006/04/2020 2,000,280.00 1.475 1.4951,999,008.39 Federal Farm Credit Bank .2360 Call 1,500,000.003133ELH49 06/11/2030 3,6321.55006/11/2020 1,500,075.00 1.560 1.5821,495,525.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 10 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Farm Credit Bank .2362 Call 1,500,000.003133ELH49 06/11/2030 3,6321.55006/11/2020 1,500,075.00 1.558 1.5801,495,875.54 Federal Farm Credit Bank .2363 Call 1,500,000.003133ELK60 06/17/2030 3,6381.58006/17/2020 1,500,015.00 1.558 1.5801,500,000.00 Federal Farm Credit Bank .2364 Call 2,000,000.003133ELH49 06/11/2030 3,6321.55006/17/2020 2,000,100.00 1.528 1.5492,000,000.00 Federal Home Loan Bank1041 1,500,000.00313378LA7 02/25/2022 6042.33003/20/2012 1,551,165.00 2.298 2.3301,500,000.00 Federal Home Loan Bank1073 2,000,000.00313379EC9 11/18/2020 1402.00005/18/2012 2,013,620.00 1.972 2.0002,000,000.00 Federal Home Loan Bank1156 1,315,000.003133XHRJ3 12/10/2021 5275.00002/25/2013 1,404,840.80 1.825 1.8501,369,864.03 Federal Home Loan Bank1240 1,500,000.00313371U79 12/11/2020 1633.12501/09/2014 1,519,860.00 2.615 2.6511,502,862.28 Federal Home Loan Bank1261 1,500,000.00313382K69 03/12/2021 2541.75003/13/2014 1,515,735.00 2.418 2.4511,493,293.55 Federal Home Loan Bank1267 1,500,000.00313370US5 09/11/2020 722.87504/02/2014 1,507,800.00 2.271 2.3031,501,541.72 Federal Home Loan Bank1270 200,000.00313379EC9 11/18/2020 1402.00004/08/2014 201,362.00 2.263 2.295199,792.66 Federal Home Loan Bank1272 550,000.00313379EC9 11/18/2020 1402.00004/09/2014 553,745.50 2.263 2.295549,429.57 Federal Home Loan Bank1577 1,500,000.003130A7Q73 12/08/2021 5251.53004/08/2016 1,527,525.00 1.450 1.4701,501,230.16 Federal Home Loan Bank1605 1,000,000.00313382K69 03/12/2021 2541.75004/27/2016 1,010,490.00 1.490 1.5111,001,596.10 Federal Home Loan Bank1619 500,000.003133827D9 02/08/2021 2221.75006/02/2016 504,725.00 1.476 1.496500,734.72 Federal Home Loan Bank1620 400,000.003133XDVS7 12/11/2020 1635.25006/02/2016 409,072.00 1.461 1.481406,456.89 Federal Home Loan Bank1649 250,000.003130A0EN6 12/10/2021 5272.87506/28/2016 259,440.00 1.232 1.249255,645.32 Federal Home Loan Bank1699 500,000.003133827E7 02/06/2023 9502.13010/05/2016 524,115.00 1.578 1.600506,517.54 Federal Home Loan Bank1727 1,000,000.003130AABG2 11/29/2021 5161.87512/16/2016 1,024,270.00 2.168 2.198995,676.16 Federal Home Loan Bank1763 1,910,000.003133XHRJ3 12/10/2021 5275.00003/10/2017 2,040,491.20 2.150 2.1801,983,367.05 Federal Home Loan Bank1780 1,000,000.00313378CR0 03/11/2022 6182.25004/12/2017 1,033,060.00 1.903 1.9301,005,141.38 Federal Home Loan Bank1873 Call 1,500,000.003130ACMH4 10/16/2024 1,5682.50010/16/2017 1,508,355.00 2.465 2.5001,500,000.00 Federal Home Loan Bank1886 1,000,000.003130A3VC5 12/08/2023 1,2552.25001/03/2018 1,063,580.00 2.359 2.392995,457.57 Federal Home Loan Bank1896 1,000,000.003130A3DL5 09/08/2023 1,1642.37501/09/2018 1,062,980.00 2.376 2.409998,983.23 Federal Home Loan Bank1903 500,000.003130ADEV0 01/17/2023 9302.38001/18/2018 526,990.00 2.385 2.418499,541.75 Federal Home Loan Bank1996 Call 1,000,000.003130AFG84 11/29/2028 3,0733.87512/06/2018 1,032,980.00 3.823 3.876999,915.73 Federal Home Loan Bank2228 Call 1,500,000.003130AHZ71 02/25/2030 3,5262.37502/25/2020 1,509,480.00 2.353 2.3861,498,552.50 Federal Home Loan Bank2243 Call 1,000,000.003130AHN74 12/17/2029 3,4562.60002/05/2020 1,005,420.00 2.506 2.5401,004,899.96 Federal Home Loan Bank2246 Call 1,000,000.003130AJ3X5 02/11/2025 1,6861.85002/11/2020 1,001,340.00 1.824 1.8501,000,000.00 Federal Home Loan Bank2258 Call 1,500,000.003130AJ6P9 02/21/2025 1,6961.95002/21/2020 1,503,570.00 1.923 1.9501,500,000.00 Federal Home Loan Bank2281 Call 1,500,000.003130AJCB3 09/18/2029 3,3662.00003/18/2020 1,501,395.00 1.972 2.0001,500,000.00 Federal Home Loan Bank2284 Call 1,500,000.003130AJCW7 06/12/2029 3,2681.85003/12/2020 1,500,045.00 1.824 1.8501,500,000.00 Federal Home Loan Bank2290 Call 1,000,000.003130AJCW7 06/12/2029 3,2681.85003/12/2020 1,000,030.00 1.824 1.8501,000,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 11 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Home Loan Bank2305 Call 857,142.863130AJE39 09/17/2026 2,2691.33003/17/2020 857,151.43 1.311 1.330857,142.86 Federal Home Loan Bank2317 Call 1,500,000.003130AJER6 03/26/2030 3,5551.85003/26/2020 1,500,030.00 1.824 1.8501,500,000.00 Federal Home Loan Bank2319 Call 2,000,000.003130AJEZ8 03/25/2030 3,5542.15003/25/2020 2,001,120.00 2.120 2.1502,000,000.00 Federal Home Loan Bank2328 Call 1,500,000.003130AJF95 03/24/2025 1,7271.30003/24/2020 1,500,780.00 1.282 1.3001,500,000.00 Federal Home Loan Bank2347 Call 1,500,000.003130AJMF3 11/28/2028 3,0721.32005/28/2020 1,500,060.00 1.301 1.3201,500,000.00 Federal Home Loan Bank2358 Call 1,000,000.003130AJP78 06/11/2029 3,2671.40006/11/2020 1,000,230.00 1.380 1.4001,000,000.00 Federal Home Loan Bank2361 Call 1,000,000.003130AJP78 06/11/2029 3,2671.40006/11/2020 1,000,230.00 1.427 1.447996,024.69 Federal Home Loan Bank2368 Call 900,000.003130AJR76 06/29/2029 3,2851.25006/29/2020 900,081.00 1.232 1.250900,000.00 Federal Home Loan Bank2369 Call 1,500,000.003130AJRG6 06/24/2030 3,6451.36006/24/2020 1,497,975.00 1.341 1.3601,500,000.00 Federal Home Loan Bank2374 Call 1,500,000.003130AJSM2 12/29/2028 3,1031.25006/29/2020 1,494,870.00 1.232 1.2501,500,000.00 Fed. Home Loan Mortgage Corp.1273 2,000,000.003134G45T1 12/10/2021 5272.00004/10/2014 2,051,100.00 2.564 2.6001,984,399.91 Fed. Home Loan Mortgage Corp.1277 1,000,000.003134G45T1 12/10/2021 5272.00004/22/2014 1,025,550.00 2.643 2.680991,183.80 Fed. Home Loan Mortgage Corp.2241 Call 1,000,000.003134GVAR9 02/14/2025 1,6891.90002/14/2020 1,001,360.00 1.873 1.9001,000,000.00 Fed. Home Loan Mortgage Corp.2245 Call 1,000,000.003134GVAU2 02/12/2024 1,3211.80002/12/2020 1,001,870.00 1.775 1.8001,000,000.00 Fed. Home Loan Mortgage Corp.2247 Call 1,000,000.003134GVAT5 02/12/2025 1,6871.80002/12/2020 1,006,980.00 1.775 1.8001,000,000.00 Fed. Home Loan Mortgage Corp.2254 Call 1,500,000.003134GVBQ0 02/14/2025 1,6891.85002/14/2020 1,501,740.00 1.824 1.8501,500,000.00 Fed. Home Loan Mortgage Corp.2256 Call 1,000,000.003134GVCH9 02/14/2025 1,6891.87502/14/2020 1,001,380.00 1.849 1.8751,000,000.00 Fed. Home Loan Mortgage Corp.2257 Call 1,000,000.003134GVCN6 02/18/2025 1,6931.75002/18/2020 1,001,410.00 1.757 1.781998,610.83 Fed. Home Loan Mortgage Corp.2315 Call 1,000,000.003134GVGY8 03/17/2025 1,7201.15003/17/2020 1,000,050.00 1.134 1.1501,000,000.00 Fed. Home Loan Mortgage Corp.2345 Call 455,000.003134GVUA4 05/18/2028 2,8781.20005/18/2020 452,656.75 1.183 1.200455,000.00 Fed. Home Loan Mortgage Corp.2370 Call 1,500,000.003134GV3B2 06/28/2030 3,6491.40006/30/2020 1,499,670.00 1.380 1.4001,500,000.00 Fed. Home Loan Mortgage Corp.2373 Call 1,500,000.003134GV3U0 06/29/2029 3,2851.25006/29/2020 1,496,415.00 1.232 1.2501,500,000.00 Federal National Mortgage Asso1048 2,000,000.003136G0AW1 10/16/2020 1072.35004/16/2012 2,012,740.00 2.317 2.3502,000,000.00 Federal National Mortgage Asso1066 2,000,000.003136G0FJ5 10/30/2020 1212.00004/30/2012 2,012,100.00 1.972 2.0002,000,000.00 Federal National Mortgage Asso1268 1,500,000.003136FTR43 08/28/2020 582.00004/08/2014 1,504,425.00 2.172 2.2021,499,553.54 Federal National Mortgage Asso1276 1,000,000.003136G0U58 04/30/2021 3031.75004/16/2014 1,012,980.00 2.364 2.397995,079.60 Federal National Mortgage Asso1288 250,000.003136G0M57 04/09/2021 2821.75005/02/2014 252,987.50 2.452 2.486248,700.74 Federal National Mortgage Asso1654 1,000,000.003136G0EG2 04/23/2021 2962.28006/30/2016 1,016,930.00 1.171 1.1871,008,587.80 Federal National Mortgage Asso1715 500,000.0031364CCC0 04/30/2026 2,1297.12511/10/2016 682,410.00 2.367 2.400622,554.57 Federal National Mortgage Asso1883 500,000.003136G05L1 08/26/2022 7862.00012/29/2017 518,650.00 2.238 2.270497,254.00 Federal National Mortgage Asso1894 1,000,000.003135G0T78 10/05/2022 8262.00001/09/2018 1,038,310.00 2.288 2.320993,176.91 Federal National Mortgage Asso1904 1,000,000.003135G0T78 10/05/2022 8262.00001/19/2018 1,038,310.00 2.409 2.443990,585.34 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 12 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal National Mortgage Asso1922 1,000,000.003136G0P62 10/15/2020 1061.50002/05/2018 1,003,860.00 2.268 2.300997,770.33 Federal National Mortgage Asso1926 1,500,000.003135G0T94 01/19/2023 9322.37502/08/2018 1,584,645.00 2.574 2.6101,491,615.25 San Mateo Union High School Dt2153 MUN 1,360,000.00799017WD6 09/01/2028 2,9842.23711/07/2019 1,393,904.80 2.447 2.4801,335,813.08 Tennessee Valley Authority1132 500,000.00880591EL2 02/15/2021 2293.87512/14/2012 511,330.00 1.596 1.618506,550.91 Tennessee Valley Authority1133 1,010,000.00880591EN8 08/15/2022 7751.87512/14/2012 1,040,845.40 1.893 1.9201,009,121.07 Tennessee Valley Authority1145 1,500,000.00880591EL2 02/15/2021 2293.87501/23/2013 1,533,990.00 1.647 1.6691,519,179.32 Tennessee Valley Authority1260 1,160,000.00880591EL2 02/15/2021 2293.87503/12/2014 1,186,285.60 2.427 2.4611,169,328.39 Tennessee Valley Authority1508 1,000,000.00880591CJ9 11/01/2025 1,9496.75011/20/2015 1,321,200.00 2.807 2.8461,180,188.33 Tennessee Valley Authority1519 750,000.00880591ER9 09/15/2024 1,5372.87501/15/2016 827,220.00 2.564 2.600757,711.94 Tennessee Valley Authority1589 775,000.00880591CJ9 11/01/2025 1,9496.75004/18/2016 1,023,930.00 2.337 2.370936,183.38 Tennessee Valley Authority1703 1,490,000.00880591EN8 08/15/2022 7751.87510/07/2016 1,535,504.60 1.538 1.5601,499,477.33 Tennessee Valley Authority1714 1,250,000.00880591CJ9 11/01/2025 1,9496.75011/10/2016 1,651,500.00 2.317 2.3501,513,071.49 Subtotal and Average 210,278,915.19 208,450,142.86 215,468,845.62 1.995 2.022 1,701 Treasury Securities (Notes) U.S. Treasury1761 TB 1,500,000.00912828J43 02/28/2022 6071.75003/09/2017 1,539,090.00 2.071 2.1001,491,753.98 U.S. Treasury1866 TB 1,500,000.00912828L57 09/30/2022 8211.75010/06/2017 1,553,145.00 1.914 1.9411,493,887.84 U.S. Treasury1898 TB 1,500,000.00912828P38 01/31/2023 9441.75001/11/2018 1,560,645.00 2.308 2.3401,478,537.55 U.S. Treasury1905 TB 1,500,000.00912828N30 12/31/2022 9132.12501/22/2018 1,573,065.00 2.387 2.4201,489,621.05 U.S. Treasury1923 TB 1,500,000.00912828P38 01/31/2023 9441.75002/05/2018 1,560,645.00 2.560 2.5961,469,416.42 U.S. Treasury1925 TB 1,000,000.00912828P38 01/31/2023 9441.75002/08/2018 1,040,430.00 2.487 2.521981,359.67 U.S. Treasury1929 TB 1,000,000.00912828P79 02/28/2023 9721.50002/09/2018 1,035,230.00 2.534 2.570973,447.28 U.S. Treasury1934 TB 1,000,000.00912828P79 02/28/2023 9721.50002/15/2018 1,035,230.00 2.601 2.638971,806.71 Subtotal and Average 10,349,830.50 10,500,000.00 10,897,480.00 2.330 2.363 878 Municipal Bonds Acalanes Union High School Dis1494 MUN 1,000,000.00004284B38 08/01/2021 3962.38110/30/2015 1,013,310.00 2.120 2.1501,002,338.87 Acalanes Union High School Dis2334 MUN 485,000.00004284ZY4 08/01/2022 7612.90003/25/2020 502,338.75 1.677 1.700496,824.02 County of Alameda2173 MUN 290,000.00010878AS5 08/01/2026 2,2224.00012/05/2019 335,109.50 2.139 2.168319,926.04 Alameda County Joint Pws Auth.2005 MUN 505,000.00010831DS1 06/01/2025 1,7963.36512/24/2018 545,894.90 3.175 3.220508,221.25 Antelope Valley Community Coll1790 MUN 220,000.0003667PFL1 08/01/2022 7612.60805/09/2017 227,469.00 2.266 2.298221,321.23 Antelope Valley Community Coll2069 MUN 500,000.0003667PFN7 08/01/2024 1,4923.02608/16/2019 540,070.00 1.876 1.902521,790.59 State of Arkansas1913 MUN 320,000.00041042ZW5 06/01/2022 7002.87501/26/2018 332,131.20 2.486 2.520322,048.04 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 13 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds Burlingame School District1548 MUN 730,000.00121457EQ4 08/01/2025 1,8576.23802/24/2016 814,395.30 3.557 3.606812,154.84 Cabrillo Community College Dis2119 MUN 2,000,000.00127109QD1 08/01/2027 2,5872.38510/08/2019 2,076,260.00 2.342 2.3752,000,000.00 Carlsbad Unified School Dist .1547 MUN 300,000.00142665DH8 08/01/2021 3964.58402/24/2016 310,476.00 2.130 2.159307,402.11 Carlsbad Unified School Dist .1556 MUN 1,250,000.00142665DH8 08/01/2021 3964.58403/04/2016 1,293,650.00 2.138 2.1681,280,697.01 Carlsbad Unified School Dist .1753 MUN 350,000.00142665DH8 08/01/2021 3964.58402/17/2017 362,222.00 2.317 2.350358,009.14 Carlsbad Unified School Dist .1857 MUN 305,000.00142665DJ4 08/01/2026 2,2225.23409/27/2017 366,454.45 2.850 2.890343,126.02 Cerritos Community College Dis1523 MUN 500,000.00156792GV9 08/01/2021 3962.78101/27/2016 511,575.00 2.012 2.040503,777.14 Cerritos Community College Dis1876 MUN 55,000.00156792GW7 08/01/2022 7612.97111/30/2017 57,428.25 2.416 2.45055,560.22 Contra Costa Community College2103 MUN 400,000.00212204JJ1 08/01/2028 2,9532.21309/12/2019 415,716.00 2.071 2.100403,311.16 Contra Costa Community College2120 MUN 990,000.00212204JK8 08/01/2029 3,3182.26309/20/2019 1,026,392.40 2.505 2.539968,101.96 Contra Costa Community College2244 MUN 1,500,000.00212204JK8 08/01/2029 3,3182.26302/07/2020 1,555,140.00 2.100 2.1301,516,321.27 Contra Costa Community College2291 MUN 320,000.00212204JF9 08/01/2025 1,8571.91803/09/2020 326,092.80 1.128 1.143332,179.39 State of Delaware1952 MUN 1,500,000.002463807H6 07/01/2022 7303.50005/03/2018 1,576,890.00 2.927 2.9671,514,895.06 Federal Home Loan Bank2312 Call 742,574.263130AJEQ8 03/30/2027 2,4631.50003/30/2020 742,589.11 1.479 1.500742,574.26 Fremon Union High School Distr1646 MUN 525,000.00357172VA0 02/01/2026 2,0416.08006/28/2016 635,544.00 2.994 3.035602,928.97 Fullerton School District1916 MUN 995,000.00359819DN6 08/01/2026 2,2223.16002/14/2018 1,079,266.55 3.028 3.070999,755.72 Fullerton School District1917 MUN 750,000.00359819DM8 08/01/2025 1,8573.04002/14/2018 801,847.50 2.959 3.000751,348.49 Fullerton School District2085 MUN 365,000.00359819DN6 08/01/2026 2,2223.16008/29/2019 395,911.85 1.913 1.940390,231.49 State of Georgia1613 MUN 500,000.00373384RU2 10/01/2022 8223.57005/17/2016 528,600.00 1.878 1.904517,612.38 State of Georgia1645 MUN 365,000.00373384W69 02/01/2023 9453.25006/27/2016 385,699.15 1.898 1.925376,677.71 State of Georgia1666 MUN 1,825,000.003733844V5 02/01/2025 1,6762.37507/29/2016 1,933,916.00 1.972 1.9991,853,706.20 State of Georgia1691 MUN 385,000.00373384RU2 10/01/2022 8223.57009/26/2016 407,022.00 1.630 1.653400,771.11 State of Georgia1775 MUN 250,000.00373384RX6 10/01/2025 1,9184.00004/10/2017 288,070.00 2.739 2.777264,213.72 State of Georgia1919 MUN 1,095,000.00373384RY4 10/01/2026 2,2834.31001/26/2018 1,311,284.40 2.979 3.0201,172,141.56 State of Georgia1945 MUN 200,000.00373384RY4 10/01/2026 2,2834.31003/19/2018 239,504.00 3.204 3.248211,485.29 State of Georgia1962 MUN 390,000.00373384SP2 10/01/2023 1,1873.74010/25/2018 424,203.00 3.093 3.136397,037.19 State of Georgia1967 MUN 350,000.00373385BU6 02/01/2027 2,4062.72010/31/2018 377,765.50 3.412 3.460335,267.30 State of Georgia1980 MUN 1,200,000.00373384PB6 11/01/2027 2,6795.01411/30/2018 1,532,856.00 3.649 3.7001,297,693.98 State of Georgia2086 MUN 1,500,000.00373384RV0 10/01/2023 1,1873.72008/29/2019 1,630,605.00 1.749 1.7741,591,100.24 State of Georgia2229 MUN 425,000.00373384RY4 10/01/2026 2,2834.31001/31/2020 508,946.00 1.837 1.863485,846.40 State of Georgia2332 MUN 1,000,000.00373384RW8 10/01/2024 1,5533.82003/23/2020 1,117,160.00 1.889 1.9151,077,142.67 City of Glendora2109 MUN 1,345,000.00378612AL9 06/01/2028 2,8922.26509/16/2019 1,394,912.95 2.318 2.3501,336,832.18 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 14 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds City of Glendora2137 MUN 400,000.00378612AL9 06/01/2028 2,8922.26510/02/2019 414,844.00 2.194 2.225401,140.37 State of Hawaii1685 MUN 1,045,000.00419792DA1 10/01/2026 2,2833.15010/19/2016 1,131,881.30 2.431 2.4651,084,430.37 State of Hawaii1852 MUN 225,000.00419791YP7 02/01/2022 5804.80009/21/2017 238,189.50 2.071 2.100234,143.33 State of Hawaii1944 MUN 1,000,000.00419792NH5 10/01/2022 8221.92103/20/2018 1,019,300.00 2.584 2.620985,255.12 State of Hawaii1946 MUN 355,000.00419791YP7 02/01/2022 5804.80003/21/2018 375,810.10 2.761 2.800365,580.43 State of Hawaii1947 MUN 1,500,000.00419792NH5 10/01/2022 8221.92103/29/2018 1,528,950.00 2.663 2.7001,475,392.88 State of Hawaii1961 MUN 250,000.00419791YS1 02/01/2025 1,6765.23010/25/2018 293,337.50 3.363 3.410268,622.84 State of Hawaii1981 MUN 500,000.00419791YV4 02/01/2028 2,7715.48011/30/2018 632,735.00 3.687 3.739555,427.02 State of Hawaii1995 MUN 800,000.00419791YT9 02/01/2026 2,0415.33012/06/2018 965,048.00 3.304 3.350878,033.27 State of Hawaii2019 MUN 750,000.00419792NH5 10/01/2022 8221.92101/17/2019 764,475.00 2.613 2.650738,346.38 State of Hawaii2331 MUN 1,000,000.00419792YK6 01/01/2021 1843.25003/23/2020 1,010,920.00 1.327 1.3461,009,413.80 City of Los Angeles1748 MUN 1,000,000.00544351KS7 09/01/2023 1,1572.64002/14/2017 1,063,980.00 2.784 2.8231,000,860.92 City of Los Angeles1879 MUN 1,090,000.00544351KR9 09/01/2022 7922.44012/11/2017 1,136,226.90 2.355 2.3881,091,145.27 City of Los Angeles1969 MUN 295,000.00544351NP0 09/01/2026 2,2533.30011/02/2018 333,615.50 3.530 3.579290,583.66 City of Los Angeles2008 MUN 1,000,000.00544351MS5 09/01/2026 2,2533.50001/07/2019 1,142,790.00 3.077 3.1191,020,676.47 City of Los Angeles2200 MUN 840,000.00544351NQ8 09/01/2027 2,6183.40001/06/2020 958,683.60 2.360 2.393895,064.97 City of Los Angeles2213 MUN 985,000.00544351LQ0 09/01/2029 3,3493.05001/22/2020 1,087,922.65 2.413 2.4461,033,273.54 City of Los Angeles2283 MUN 1,000,000.00544351KV0 09/01/2026 2,2533.15003/05/2020 1,121,990.00 1.519 1.5411,094,074.40 Los Angeles Dept. of WTR & PWR1949 MUN 1,500,000.00544495VX9 07/01/2027 2,5565.51603/29/2018 1,900,875.00 3.254 3.3001,699,028.57 Los Angeles Dept. of WTR & PWR1965 MUN 425,000.00544495VX9 07/01/2027 2,5565.51610/29/2018 538,581.25 3.600 3.650472,200.16 Los Angeles Dept. of WTR & PWR1975 MUN 300,000.00544525NW4 07/01/2022 7305.18111/07/2018 324,900.00 3.166 3.210311,067.95 State of Massachusetts2227 MUN 250,000.0057582PUT5 05/01/2029 3,2264.91001/30/2020 313,107.50 2.331 2.363300,246.58 State of Maryland1689 MUN 485,000.005741925C0 03/01/2022 6084.30009/16/2016 511,835.05 1.534 1.555506,234.85 State of Maryland1762 MUN 1,000,000.00574193NC8 03/15/2022 6222.25003/22/2017 1,017,970.00 2.219 2.2501,000,000.00 State of Maryland1941 MUN 1,500,000.00574193PU6 03/15/2021 2572.48003/21/2018 1,514,820.00 2.406 2.4401,500,404.41 State of Maryland1943 MUN 1,280,000.005741925D8 03/01/2023 9734.40003/20/2018 1,394,470.40 2.633 2.6701,334,961.37 State of Maryland1958 MUN 1,690,000.005741926L9 08/01/2024 1,4924.20010/19/2018 1,885,144.30 3.413 3.4611,735,823.39 State of Maryland2184 MUN 500,000.005741926N5 08/01/2025 1,8574.35012/16/2019 569,005.00 2.089 2.118553,182.96 State of Maryland - Dept/Trans2134 MUN 1,000,000.00574204WH2 06/15/2023 1,0794.45010/15/2019 1,084,940.00 1.893 1.9201,071,852.24 State of Michigan2002 MUN 825,000.005946108C4 05/15/2026 2,1443.85012/21/2018 873,716.25 3.452 3.500839,802.17 Menlo Park City School Dist.2104 MUN 1,000,000.00586840ND8 07/01/2027 2,5562.21410/08/2019 1,052,630.00 2.183 2.2141,000,000.00 Mtn. View-Whisman School Dist.1348 MUN 500,000.0062451FFK1 08/01/2021 3962.97307/24/2014 512,665.00 2.893 2.933501,091.14 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 15 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds Marin Community College Dist.1858 MUN 500,000.0056781RGU5 08/01/2027 2,5873.27209/28/2017 568,715.00 2.791 2.830513,570.49 Marin Community College Dist.1973 MUN 120,000.0056781RGT8 08/01/2026 2,2223.17211/05/2018 134,445.60 3.452 3.500117,914.39 Marin Community College Dist.2084 MUN 250,000.0056781RJL2 08/01/2027 2,5873.33008/29/2019 285,337.50 1.874 1.900273,403.31 Marin Community College Dist.2287 MUN 310,000.0056781RJJ7 08/01/2025 1,8575.00003/06/2020 371,662.10 1.193 1.210367,640.01 Mt. San Antonio Community Coll1489 MUN 1,335,000.00623040GX4 08/01/2023 1,1264.10310/26/2015 1,471,797.45 2.490 2.5251,393,632.48 Mt. San Antonio Community Coll2208 MUN 230,000.00623040KQ4 08/01/2029 3,3182.56902/04/2020 249,336.10 2.533 2.569230,000.00 State of Mississippi1968 MUN 1,500,000.00605581LM7 11/01/2026 2,3143.75111/07/2018 1,720,215.00 3.377 3.4241,526,881.63 State of Mississippi1972 MUN 500,000.00605581LM7 11/01/2026 2,3143.75111/07/2018 573,405.00 3.401 3.449508,266.39 State of Mississippi2087 MUN 750,000.00605581HL4 12/01/2024 1,6142.98708/30/2019 804,570.00 1.745 1.770788,322.70 State of Mississippi2090 MUN 500,000.00605581HL4 12/01/2024 1,6142.98709/04/2019 536,380.00 1.783 1.807524,730.52 State of Mississippi2096 MUN 150,000.006055805W5 11/01/2025 1,9494.68109/09/2019 175,018.50 1.888 1.914170,840.94 State of Mississippi2189 MUN 250,000.006055805V7 11/01/2024 1,5844.51112/19/2019 283,120.00 2.079 2.108274,613.18 State of Mississippi2329 MUN 1,000,000.00605581LJ4 11/01/2023 1,2183.40803/20/2020 1,074,530.00 1.626 1.6491,056,621.79 City of Napa Solid Waste2055 MUN 595,000.00630337AL7 08/01/2024 1,4922.20008/08/2019 611,279.20 1.968 1.996599,692.77 State of New Hampshire1948 MUN 1,500,000.00644682M37 06/01/2021 3353.50003/22/2018 1,533,270.00 2.544 2.5801,512,054.05 New York St Envrnmntl Facs1942 MUN 1,000,000.0064985HWN3 07/15/2020 141.43103/15/2018 1,000,240.00 2.377 2.410999,631.67 New York St Envrnmntl Facs2007 MUN 450,000.0064985HWS2 07/15/2024 1,4752.12001/04/2019 465,295.50 2.860 2.900436,986.30 New York State Urban Dev Corp.2097 MUN 700,000.006500357D4 03/15/2026 2,0833.07009/09/2019 758,317.00 2.071 2.100736,024.67 New York State Envrnmntl Corp1933 MUN 2,000,000.0064986DEE1 06/15/2022 7142.43802/15/2018 2,051,400.00 2.624 2.6611,991,780.65 New York State Envrnmntl Corp2022 MUN 1,000,000.00649791CN8 03/01/2023 9734.69001/22/2019 1,080,530.00 2.752 2.7911,047,513.18 New York State Envrnmntl Corp2024 MUN 1,000,000.00649791CN8 03/01/2023 9734.69002/08/2019 1,080,530.00 2.751 2.7901,047,573.48 New York State Envrnmntl Corp2146 MUN 1,500,000.00649791PQ7 02/15/2025 1,6902.12010/31/2019 1,567,995.00 2.063 2.0911,501,926.05 New York State Envrnmntl Corp2224 MUN 580,000.00649791PS3 02/15/2027 2,4202.36001/30/2020 619,034.00 1.933 1.960594,279.92 City of Oakland2293 MUN 1,500,000.00672240WY0 01/15/2030 3,4852.11003/09/2020 1,516,545.00 1.436 1.4561,586,750.63 City of Oakland2307 MUN 1,500,000.00672240WY0 01/15/2030 3,4852.11003/13/2020 1,516,545.00 1.638 1.6611,559,028.54 City of Oakland2313 MUN 1,080,000.00672240WY0 01/15/2030 3,4852.11003/16/2020 1,091,912.40 2.247 2.2791,064,374.96 City of Oakland2316 MUN 1,500,000.00672240WX2 01/15/2029 3,1202.07003/16/2020 1,524,045.00 2.151 2.1811,486,945.89 Ohlone Community College Distr2165 MUN 600,000.00677765GY9 08/01/2027 2,5872.23711/22/2019 631,716.00 2.271 2.303597,425.14 Ohlone Community College Distr2175 MUN 280,000.00677765GY9 08/01/2027 2,5872.23712/06/2019 294,800.80 2.327 2.360277,776.36 Ohlone Community College Distr2179 MUN 970,000.00677765HA0 08/01/2029 3,3182.33712/11/2019 1,014,959.50 2.382 2.415963,875.58 Ohlone Community College Distr2341 MUN 1,185,000.00677765GZ6 08/01/2028 2,9532.28705/08/2020 1,244,569.95 1.849 1.8751,221,368.86 State of Ohio1550 MUN 1,500,000.00677522HZ0 05/01/2021 3041.57003/09/2016 1,514,040.00 1.548 1.5691,500,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 16 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds State of Ohio1688 MUN 800,000.00677522JB1 05/01/2023 1,0342.11009/13/2016 833,744.00 1.764 1.788806,834.17 State of Ohio1742 MUN 2,000,000.00677522JB1 05/01/2023 1,0342.11001/31/2017 2,084,360.00 2.485 2.5201,978,611.73 State of Ohio1832 MUN 900,000.006775207G7 04/01/2024 1,3704.97106/30/2017 996,075.00 2.416 2.450977,957.92 State of Ohio1881 MUN 200,000.00677521GP5 11/01/2020 1233.62512/21/2017 202,170.00 2.179 2.210200,908.74 State of Ohio2308 MUN 500,000.00677521CT1 09/01/2026 2,2535.26203/13/2020 612,400.00 1.710 1.734602,455.67 Orchard School District1910 MUN 200,000.00685585FD8 08/01/2027 2,5873.12501/25/2018 212,522.00 3.208 3.253198,485.77 State of Oregon1682 MUN 570,000.0068609BGH4 05/01/2022 6692.50008/29/2016 591,044.40 1.528 1.550579,465.80 State of Oregon1974 MUN 500,000.0068607LXQ5 06/01/2027 2,5265.89211/06/2018 625,055.00 3.516 3.565558,859.14 State of Oregon2003 MUN 300,000.0068608USE7 08/01/2025 1,8572.87712/21/2018 316,224.00 3.156 3.200295,587.24 State of Oregon2015 MUN 445,000.0068607LXQ5 06/01/2027 2,5265.89201/16/2019 556,298.95 3.537 3.587505,793.91 State of Oregon2223 MUN 570,000.0068609TDT2 05/01/2024 1,4003.22701/30/2020 623,597.10 1.641 1.664602,820.38 State of Oregon2230 MUN 495,000.0068607LXQ5 06/01/2027 2,5265.89201/31/2020 618,804.45 2.583 2.619596,311.87 State of Oregon2266 MUN 1,000,000.0068607LXQ5 06/01/2027 2,5265.89202/24/2020 1,250,110.00 2.482 2.5171,212,054.38 State of Oregon2310 MUN 350,000.0068609BXT9 05/01/2027 2,4953.08003/13/2020 396,322.50 1.302 1.320390,011.95 City of Pacifica2138 MUN 1,015,000.0069511AAS3 06/01/2025 1,7962.56310/23/2019 1,041,481.35 2.469 2.5031,017,715.30 City of Pacifica2139 MUN 580,000.0069511AAT1 06/01/2026 2,1612.66310/23/2019 598,368.60 2.611 2.647580,467.56 Pasadena CA Public Finance Aut1985 MUN 665,000.00702274CP4 12/01/2023 1,2483.43812/06/2018 705,332.25 3.205 3.250668,909.76 Palo Alto Unified School Dist.1192 MUN 2,000,000.00697379UE3 08/01/2021 3962.44105/10/2013 2,032,900.00 2.031 2.0602,007,552.38 Palo Alto Unified School Dist.1193 MUN 1,800,000.00697379UE3 08/01/2021 3962.44105/13/2013 1,829,610.00 2.031 2.0601,806,796.92 Palo Alto Unified School Dist.1195 MUN 1,990,000.00697379UE3 08/01/2021 3962.44105/15/2013 2,022,735.50 2.051 2.0801,997,115.13 Palo Alto Unified School Dist.1437 MUN 200,000.00697379UE3 08/01/2021 3962.44101/27/2015 203,290.00 2.041 2.070200,748.05 Palo Alto Unified School Dist.1610 MUN 1,000,000.00697379UE3 08/01/2021 3962.44105/12/2016 1,016,450.00 1.528 1.5501,009,234.22 Palo Alto Unified School Dist.1684 MUN 600,000.00697379UD5 08/01/2020 312.29109/02/2016 600,666.00 1.290 1.308600,477.53 Palo Alto Unified School Dist.1880 MUN 1,025,000.00697379UD5 08/01/2020 312.29112/20/2017 1,026,137.75 1.923 1.9501,025,282.01 State of Rhode Island2192 MUN 260,000.0076222RYN6 01/15/2025 1,6592.00012/20/2019 267,592.00 2.231 2.262259,494.85 State of Rhode Island2219 MUN 1,500,000.0076222RXB3 04/01/2028 2,8313.25001/27/2020 1,676,190.00 2.077 2.1061,621,484.41 State of Rhode Island2239 MUN 550,000.0076222RXB3 04/01/2028 2,8313.25002/06/2020 614,603.00 1.990 2.018598,168.14 Redwood City School District2130 MUN 1,000,000.00757889EH9 08/01/2027 2,5872.28410/16/2019 1,054,630.00 2.252 2.2841,000,000.00 Redwood City School District2253 MUN 1,095,000.00757889EG1 08/01/2026 2,2222.15902/13/2020 1,145,326.20 1.727 1.7511,120,577.14 San Bernardino Cmty College Di2166 MUN 1,500,000.00796720NC0 08/01/2028 2,9532.59012/12/2019 1,616,775.00 2.554 2.5901,500,000.00 County of Santa Clara1897 MUN 1,340,000.00801546PH9 08/01/2023 1,1262.50001/11/2018 1,393,238.20 2.436 2.4701,341,145.30 County of Santa Clara1899 MUN 1,460,000.00801546PJ5 08/01/2024 1,4922.68001/12/2018 1,542,446.20 2.643 2.6801,460,000.00 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 17 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds Santa Clara Vly Transportation1964 MUN 1,400,000.0080168NEL9 04/01/2021 2744.64910/29/2018 1,438,738.00 3.008 3.0501,416,056.33 Santa Clara Valley Water Dist.2181 MUN 1,555,000.0080168ACV7 06/01/2028 2,8922.43412/12/2019 1,629,686.65 2.416 2.4501,553,212.18 Santa Cruz County Capital Fin.1906 MUN 465,000.0080181PCT2 06/01/2024 1,4312.50001/25/2018 481,939.95 2.968 3.010456,596.44 Santa Cruz County Capital Fin.1907 MUN 465,000.0080181PCU9 06/01/2025 1,7962.75001/25/2018 487,413.00 3.008 3.050458,887.78 Santa Cruz County Capital Fin.1908 MUN 470,000.0080181PCV7 06/01/2026 2,1613.00001/25/2018 503,393.50 3.107 3.150466,346.62 Santa Cruz County Capital Fin.1909 MUN 280,000.0080181PCW5 06/01/2027 2,5263.00001/25/2018 301,114.80 3.205 3.250275,847.04 Sequoia Union High School Dist2320 MUN 400,000.00817409N35 07/01/2025 1,8261.73503/18/2020 414,500.00 1.381 1.400406,431.95 City & County of San Francisco1441 MUN 360,000.00797646NL6 06/15/2022 7144.95002/09/2015 385,081.20 2.416 2.450376,013.84 City & County of San Francisco1509 MUN 1,000,000.00797646NC6 06/15/2025 1,8105.45011/27/2015 1,198,640.00 3.067 3.1101,099,650.77 City & County of San Francisco1711 MUN 2,105,000.00797646T48 06/15/2025 1,8102.29011/01/2016 2,189,473.65 2.219 2.2492,108,750.48 City & County of San Francisco1712 MUN 245,000.00797646T55 06/15/2026 2,1752.39011/01/2016 256,688.95 2.376 2.410244,737.66 City & County of San Francisco1839 MUN 230,000.00797646T48 06/15/2025 1,8102.29007/14/2017 239,229.90 2.682 2.720225,614.71 City & County of San Francisco2014 MUN 1,420,000.00797646ND4 06/15/2026 2,1755.60001/16/2019 1,756,284.40 3.304 3.3501,587,212.56 City & County of San Francisco2148 MUN 1,120,000.007976466C5 06/15/2029 3,2712.10010/31/2019 1,169,683.20 2.337 2.3691,095,889.25 San Francisco Cmnty Facs Dist1937 MUN 680,000.0079772EBC2 09/01/2027 2,6183.25003/02/2018 735,705.60 3.451 3.499669,739.25 San Francisco Cmnty Facs Dist2132 MUN 350,000.0079772ECL1 09/01/2029 3,3493.64810/11/2019 390,439.00 2.398 2.431384,483.21 San Francisco Cmnty Facs Dist2309 MUN 130,000.0079772ECJ6 09/01/2027 2,6183.46803/13/2020 142,530.70 1.577 1.599146,339.56 SF Bay Area Rapid Transit Dist1938 MUN 2,100,000.00797669XU7 07/01/2021 3652.38703/07/2018 2,133,453.00 2.494 2.5282,097,154.08 SF Bay Area Rapid Transit Dist1939 MUN 1,500,000.00797669XU7 07/01/2021 3652.38703/07/2018 1,523,895.00 2.497 2.5311,497,922.03 SF Bay Area Rapid Transit Dist2018 MUN 875,000.00797669XU7 07/01/2021 3652.38701/17/2019 888,938.75 2.544 2.579873,371.04 SF Bay Area Rapid Transit Dist2029 MUN 200,000.00797669XW3 07/01/2023 1,0952.62102/25/2019 209,550.00 2.672 2.710199,496.55 San Jose Evergreen Cmnty Colll1966 MUN 315,000.00798189PK6 09/01/2027 2,6183.72810/29/2018 362,861.10 3.676 3.727315,000.00 San Jose Evergreen Cmnty Colll2105 MUN 500,000.00798189QA7 08/01/2028 2,9532.35010/01/2019 541,720.00 2.317 2.350500,000.00 San Jose Evergreen Cmnty Colll2339 MUN 575,000.00798189PS9 08/01/2020 311.81404/01/2020 575,603.75 1.676 1.700575,051.75 San Jose Unified School Dist.1435 MUN 580,000.00798186C83 08/01/2023 1,1262.50001/29/2015 598,942.80 2.663 2.700576,823.05 Santa Monica Cmnty College Dis2025 MUN 215,000.00802385QW7 08/01/2022 7612.90802/19/2019 223,668.80 2.714 2.752215,668.63 Santa Monica Cmnty College Dis2091 MUN 315,000.00802385RC0 08/01/2028 2,9533.47209/05/2019 356,958.00 1.972 2.000349,172.80 San Mateo Union High School Dt1518 MUN 180,000.00799017KV9 09/01/2021 4272.72001/19/2016 183,099.60 2.046 2.075181,271.59 San Mateo Union High School Dt1902 MUN 1,000,000.00799017UW6 09/01/2025 1,8882.69901/16/2018 1,048,930.00 2.786 2.825994,165.90 San Mateo Union High School Dt1940 MUN 1,000,000.00799017UW6 09/01/2025 1,8882.69903/09/2018 1,048,930.00 2.959 3.000986,153.64 San Mateo Union High School Dt2178 MUN 1,565,000.00799017VM7 09/01/2028 2,9842.54212/11/2019 1,638,742.80 2.311 2.3431,587,756.40 Solano Cnty Community Clg Dist2176 MUN 1,150,000.0083412PFQ0 08/01/2028 2,9532.71712/09/2019 1,231,592.50 2.462 2.4961,168,313.27 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 18 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds South Pasadena Unified School1914 MUN 180,000.00839278JM1 08/01/2027 2,5873.00002/15/2018 194,439.60 3.057 3.100178,899.89 South Pasadena Unified School2161 MUN 370,000.00839278KC1 08/01/2029 3,3185.00012/12/2019 462,033.80 2.598 2.634439,810.78 South Pasadena Unified School2162 MUN 250,000.00839278KB3 08/01/2028 2,9535.00012/12/2019 307,992.50 2.549 2.584293,500.24 South Pasadena Unified School2163 MUN 145,000.00839278KA5 08/01/2027 2,5875.00012/12/2019 175,944.45 2.500 2.534167,892.49 South Pasadena Unified School2164 MUN 390,000.00839278JZ2 08/01/2026 2,2225.00012/12/2019 464,330.10 2.378 2.411446,437.10 San Rafael City High Sch Distr2150 MUN 1,755,000.00799289MR1 08/01/2024 1,4921.96511/13/2019 1,798,699.50 1.938 1.9651,755,000.00 Sunnyvale Elementary Sch Distr2100 MUN 135,000.00867578UT1 09/01/2028 2,9842.19009/19/2019 138,713.85 2.157 2.187135,000.00 Sunnyvale Elementary Sch Distr2101 MUN 135,000.00867578US3 09/01/2027 2,6182.09009/19/2019 138,481.65 2.061 2.090135,000.00 State of Tennessee1673 MUN 1,000,000.00880541XY8 08/01/2026 2,2222.11608/25/2016 1,060,900.00 1.923 1.9501,009,131.12 State of Tennessee1674 MUN 1,650,000.00880541XX0 08/01/2025 1,8572.06608/25/2016 1,737,153.00 1.893 1.9201,661,193.22 State of Tennessee1676 MUN 700,000.00880541XX0 08/01/2025 1,8572.06608/25/2016 736,974.00 1.893 1.920704,748.64 State of Tennessee2001 MUN 205,000.00880541QU4 08/01/2024 1,4923.72812/20/2018 226,299.50 2.860 2.900211,349.08 State of Texas1482 MUN 920,000.00882723PP8 10/01/2021 4572.58910/14/2015 940,930.00 1.864 1.890927,566.54 State of Texas1621 MUN 500,000.00882723A41 10/01/2020 921.77706/07/2016 501,030.00 1.450 1.470500,370.08 State of Texas1708 MUN 110,000.00882722VJ7 04/01/2022 6393.67310/19/2016 115,784.90 1.825 1.850113,323.01 State of Texas1855 MUN 250,000.00882723EN5 08/01/2025 1,8573.83209/22/2017 263,282.50 2.747 2.785261,862.01 State of Texas2013 MUN 1,000,000.00882722VH1 04/01/2021 2743.52301/11/2019 1,021,580.00 3.503 3.5521,005,356.12 State of Texas2195 MUN 1,500,000.008827237P8 10/01/2025 1,9183.05112/23/2019 1,671,315.00 1.975 2.0031,577,519.10 State of Texas2225 MUN 940,000.008827237T0 10/01/2029 3,3793.52101/30/2020 1,078,377.40 2.191 2.2211,041,162.74 State of Texas2255 MUN 1,265,000.008827237T0 10/01/2029 3,3793.52102/14/2020 1,451,220.65 2.192 2.2221,401,081.45 State of Texas2311 MUN 250,000.008827237N3 10/01/2024 1,5532.89903/16/2020 273,232.50 1.231 1.248266,998.44 University of California2077 MUN 1,500,000.0091412GQG3 05/15/2025 1,7793.05008/26/2019 1,647,345.00 1.930 1.9571,575,147.70 University of California2095 MUN 1,000,000.0091412GQG3 05/15/2025 1,7793.05009/09/2019 1,098,230.00 1.797 1.8211,056,580.65 State of Utah1622 MUN 750,000.00917542QT2 07/01/2020 03.28906/07/2016 750,000.00 1.430 1.450750,000.00 State of Utah1731 MUN 770,000.00917542QR6 07/01/2024 1,4614.55401/04/2017 818,148.10 2.904 2.944814,183.44 State of Utah1990 MUN 1,000,000.00917542QU9 07/01/2021 3653.36911/29/2018 1,023,340.00 2.959 3.0001,003,515.02 State of Utah2306 MUN 1,500,000.00917542QV7 07/01/2025 1,8263.53903/13/2020 1,606,005.00 1.948 1.9751,610,787.74 State of Washington1672 MUN 250,000.0093974DHW1 08/01/2022 7612.74008/08/2016 260,112.50 1.504 1.524256,027.20 State of Washington1721 MUN 515,000.0093974CPH7 08/01/2022 7614.63612/05/2016 555,612.90 2.465 2.500536,241.85 State of Washington1778 MUN 1,500,000.0093974CPG9 08/01/2021 3964.58604/12/2017 1,562,340.00 2.081 2.1101,538,257.26 State of Washington1802 MUN 485,000.0093974CRC6 08/01/2024 1,4924.66905/23/2017 555,426.85 2.416 2.450525,057.98 State of Washington2196 MUN 500,000.0093974CRC6 08/01/2024 1,4924.66912/24/2019 572,605.00 1.978 2.005551,689.53 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 June 30, 2020 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 19 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds State of Wisconsin2000 MUN 500,000.0097705LA49 05/01/2022 6693.80012/19/2018 510,570.00 3.076 3.119505,870.30 Subtotal and Average 163,678,198.03 158,927,574.26 170,318,012.26 2.369 2.402 1,682 Supranationals (World Bank) Bonds Inter-American Dev. Bank1978 IADB 1,500,000.004581X0CZ9 09/14/2022 8051.75011/09/2018 1,548,585.00 3.106 3.1501,456,741.71 Intl Bk Recon & Development1976 IBRD 1,500,000.00459056LD7 01/19/2023 9327.62511/08/2018 1,777,680.00 3.111 3.1551,658,905.84 Intl Bk Recon & Development1982 IBRD 1,000,000.00459058GL1 09/27/2023 1,1833.00011/27/2018 1,086,650.00 3.018 3.060998,189.30 Intl Bk Recon & Development2028 IBRD 1,500,000.0045905U2D5 02/15/2024 1,3242.50002/28/2019 1,517,715.00 2.990 3.0311,500,000.00 Intl Bk Recon & Development2106 IFC 1,500,000.0045950VNF9 09/20/2024 1,5421.70009/20/2019 1,521,840.00 1.676 1.7001,500,000.00 Intl Bk Recon & Development2111 IBRD 1,500,000.00459058HG1 09/23/2024 1,5452.20009/23/2019 1,505,265.00 2.169 2.2001,500,000.00 Intl Bk Recon & Development2116 IBRD 1,500,000.00459058HG1 09/23/2024 1,5452.20009/23/2019 1,505,265.00 2.169 2.2001,500,000.00 Intl Bk Recon & Development2154 IBRD 1,500,000.00459058HP1 11/13/2024 1,5962.05011/13/2019 1,507,500.00 2.021 2.0501,500,000.00 Intl Bk Recon & Development2156 IBRD 1,500,000.00459058HQ9 11/18/2024 1,6012.16011/18/2019 1,508,430.00 2.130 2.1601,500,000.00 Intl Bk Recon & Development2159 IBRD 1,500,000.00459058HQ9 11/18/2024 1,6012.16011/18/2019 1,508,430.00 2.130 2.1601,500,000.00 Intl Bk Recon & Development2168 IBRD 1,000,000.00459058HG1 09/23/2024 1,5452.20011/26/2019 1,003,510.00 2.118 2.1481,002,050.36 Intl Bk Recon & Development2185 IBRD 1,500,000.00459058HG1 09/23/2024 1,5452.20012/16/2019 1,505,265.00 2.136 2.1661,501,994.47 Intl Bk Recon & Development2199 IBRD 1,500,000.00459058HG1 09/23/2024 1,5452.20012/27/2019 1,505,265.00 2.147 2.1771,501,338.22 Intl Bk Recon & Development2336 IBRD 1,000,000.0045905U5S9 12/12/2024 1,6252.00003/25/2020 1,006,540.00 1.839 1.8641,005,715.32 International Finance Corp.1988 IFC 1,500,000.0045950VMW3 12/15/2023 1,2623.00012/06/2018 1,516,710.00 3.328 3.3741,500,000.00 International Finance Corp.2012 IFC 2,000,000.0045950VMY9 01/15/2024 1,2932.50001/23/2019 2,020,960.00 3.103 3.1472,000,000.00 International Finance Corp.2023 IFC 1,500,000.0045950VNC6 02/15/2024 1,3242.62502/15/2019 1,519,305.00 3.054 3.0971,500,000.00 International Finance Corp.2217 IFC 1,266,000.0045950VNR3 01/15/2025 1,6591.62501/27/2020 1,286,838.36 2.186 2.2161,266,000.00 Subtotal and Average 25,890,935.22 25,766,000.00 26,351,753.36 2.495 2.529 1,406 Total Investments and Average 561,518,261.06 554,315,784.97 576,605,401.96 1.934 1.960 1,292 Portfolio CPA AP Run Date: 07/13/2020 - 02:56 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 1 General Investment Guidelines: a) The max. stated final maturity of individual securities in the portfolio should be 10 years.Full Compliance b) A max. of 30 percent of the par value of the portfolio shall be invested in securities with maturities beyond 5 years.26.9% c) The City shall maintain a minimum of one month's cash needs in short term investments.Full Compliance d) At least $50 million shall be maintained in securities maturing in less than 2 years. Plus two managed pool accounts which provide instant liquidity: - Local Agency Investment Fund (LAIF) - maximum investment limit i $65 million $75 million - Fidelity Investments $20.4 million e) Should market value of the portfolio fall below 95 percent of the book value, report this fact within a reasonable time to the City Council and evaluate if there are risk of holding securities to maturity.102.69% d) Commitments to purchase securities newly introduced on the market shall be made no more than three (3) working days before pricing.Full Compliance f) Whenever possible, the City will obtain three or more quotations on the purchase or sale of comparable securities (excludes new issues, LAIF, City of Palo Alto bonds, money market accounts, and mutual funds).Full Compliance 2 U.S. Government Securities:Full Compliance a) There is no limit on purchase of these securities. b) Securities will not exceed 10 years maturity. 3 U.S. Government Agency Securities:Full Compliance a) There is no limit on purchase of these securities except for: Callable and Multi-step-up securities provided that: - The potential call dates are known at the time of purchase; - the interest rates at which they "step-up" are known at the time of purchase; and - the entire face value of the security is redeemed at the call date. - No more than 25 percent of the par value of portfolio.15.17% b) Securities will not exceed 10 years maturity. 4 California State, California Local Government Agencies, and other United States State Bonds:Full Compliancea)Having at time of investment a minimum Double A (AA/Aa2) rating as provided by a nationally recognized rating service (e.g., Moody’s, Fitch, and/or Standard and Poor’s). b)May not exceed 30 percent of the par value of the portfolio.28.78% 5 Certificates of Deposit (CD):Full Compliance a) May not exceed 20 percent of the par value of the portfolio;None Held b) No more than 10 percent of the par value of the portfolio in collateralized CDs in any institution. c) Purchase collateralized deposits only from federally insured large banks that are rated by a nationally recognized rating agency (e.g. Moody's, Fitch, and/or Standard & Poor's). d) For non-rated banks, deposit should be limited to amounts federally insured (FDIC) e) Rollovers are not permitted without specific instruction from authorized City staff. 6 Banker's Acceptance Notes (BA):Full Compliance a) No more than 30 percent of the par value of the portfolio.None Held b) Not to exceed 180 days maturity. c) No more than $5 million with any one institution. Attachment C Investment Policy Compliance As of June 30, 2020 Investment Policy Requirements Compliance Check / Actual $126.8 million 1.89% Attachment C Investment Policy Compliance As of June 30, 2020 Investment Policy Requirements Compliance Check / Actual 7 Commercial Paper:Full Compliance a) No more than 15 percent of the par value of the portfolio.None Held b) Having highest letter or numerical rating from a nationally recognized rating service. c) Not to exceed 270 days maturity. d) No more than $3 million or 10 percent of the outstanding commercial paper of any one institution, whichever is lesser. 8 Short-Term Repurchase Agreement (REPO):Full Compliance a) Not to exceed 1 year.None Held b) Market value of securities that underlay a repurchase agreement shall be valued at 102 percent or greater of the funds borrowed against those securities. 9 Money Market Deposit Accounts Full Compliance a) Liquid bank accounts which seek to maintain a net asset value of $1.00. 10 Mutual Funds:Full Compliance a) No more than 20 percent of the par value of the portfolio.None Held b) No more than 10 percent of the par value with any one institution. 11 Negotiable Certificates of Deposit (NCD):Full Compliance a) No more than 20 percent of the par value of the portfolio.7.07% b) No more than $5 million in any one institution.Federally Insured 12 Medium-Term Corporate Notes:Full Compliance a) No more than 10 percent of the par value of the portfolio.3.18% b) Not to exceed 5 years maturity. c) Securities eligible for investment shall have a minimum rating of AA or Aa2 from a nationally recognized rating service. d) No more than $5 million of the par value may be invested in securities of any single issuer, other than the U.S. Government, its agencies and instrumentality. e) If securities owned by the City are downgraded by either rating agencies to a level below AA it shall be the City's policy to review the credit situation and make a determination as to whether to sell or retain such securities. 13 Supranational Organizations Securities:Full Compliance a) Securities will not exceed 5 years maturity 4.65% b) No more than 20 percent of the par value of the portfolio. c) No more than 10 percent in any one institution. d) Securities eligible for investment shall have a minimum rating of AA or Aa2 from a nationally recognized rating service. 14 Prohibited Investments: a) Reverse Repurchase Agreements b) Derivatives as defined in Appendix B of the Investment Policy 15 All securities shall be delivered to the City's safekeeping custodian, and held in the name of the City, with the exception of : - Certificates of Deposit, Mutual Funds, and Local Agency Investment Fund (LAIF) Full Compliance None Held Full Compliance City of Palo Alto (ID # 11464) City Council Staff Report Report Type: Informational Report Meeting Date: 8/17/2020 City of Palo Alto Page 1 Summary Title: ADU Quarterly Report (Quarter 1 and Quarter 2) Title: ADU Quarterly Report (Quarter 1 and Quarter 2) From: City Manager Lead Department: Planning and Development Services Recommendation This is an informational report and no action is requested. Executive Summary The Accessory Dwelling Unit (ADU) Quarterly Report keeps track of the ADU permit applications received, approved and finalized yearly by the City, as well as the details of quarterly applications received. Since 2015, the City has issued a total of 135 permits; 45% of these permits were issued during 2019. During each of the first and second quarters of 2020 Palo Alto received a total of 32 ADU building permit applications, 16 per each quarter. The details of the applications are provided in Attachment A of the staff report. Background In June 2017, the City Council amended the Zoning Code (Title 18) to update ADU regulations to comply with State requirements. Council then directed staff to provide quarterly reports on the number of permits filed for the construction of ADUs. The City Council received the last development report for the fourth quarter 2019 on May 18, 2020 (Report ID # 10999). In mid-January 2020, Council adopted an Interim Urgency Ordinance to update the City’s ADU regulations to comply with new State requirements in effect as of January 1, 2020. The Interim Ordinance is in effect through January 2021 and implemented minimal required changes to the Palo Alto Municipal Code (PAMC) for compliance, pending preparation of a more comprehensive ordinance update. Staff prepared a new ADU ordinance, which the Planning and Transportation Commission reviewed on May 27, 2020 and recommended for adoption by the City Council. City of Palo Alto Page 2 Discussion This report tracks the ADU permit applications filed with the City and the status as to permit issuance and completion of construction to final inspection since 2015. The following table (Table 1) is a “snapshot” of the increase in ADU permit applications before and after the adoption of new regulations. City of Palo Alto Page 3 Table 1: Summary of ADU Permits from 2015-2020 Category 2015 2016 2017 2018 2019 2020 New ADU Applications Filed1 10 9 28 55 75 32 Permits: Ready to Issue (City Approved)2 8 5 12 39 62 8 Permits: Issued (Permit Obtained)3 8 5 12 35 62 13 Permits: Final Inspection Approved4 3 4 9 12 33 23 Permits Expired 1 1 Detached ADUs (Submitted)5 20 35 52 23 Detached ADUs (Issued)5 8 24 41 9 Attached ADUs (Submitted)6 8 20 23 9 Attached ADUs (Issued)6 4 11 21 4 Junior ADUs (Submitted)7 1 1 1 Junior ADUs (Issued)7 1 1 0 Average Application Processing Time (Days Including Weekends)8 127 214 118 183 135 92 Average Construction Time (Days Including Weekends)9 578 751 330 287 173 439 Total City Impact Fees Collected for New ADUs10 $451,514 $402,012 $198,962 $7,511 Source: City of Palo Alto Accela Data January 2015 through June 2020 Notes: 1. Any ADU/JADU Application SUBMITTED for the year 2. Any ADU/JADU application Permit 'READY TO Issue 'includes application permits processed by the City and waiting to be picked up by applicants for the year (regardless of the year when it was submitted). 3. Any ADU/JADU Permit ISSUED for the year (regardless of when it was submitted) 4. Any ADU/JADU Permit receiving a Final Inspection (Ready to Occupy) for the year, regardless of when the application was submitted. Years 2015-2017 data point not available. City of Palo Alto Page 4 5. Any Detached ADU Permit Application submitted for the year/Any Detached ADU Permit Issued for the year, regardless of when the application was submitted. Years 2015-2016 data point not available. 6. Any Attached ADU Permit Application submitted for the year/Any Attached ADU Permit Issued for the year, regardless of when the application was submitted. Years 2015-2016 data point not available. 7. Any JADU Permit Application submitted for the year/Any JADU Permit Issued for the year, regardless of when the application was submitted. Years 2015-2016 data point not available. 8. Average number of days from permit application submittal to when permit is approved and ready to issue. This average includes weekends and days application is pending due to applicant preparation of resubmittal or additional information from applicant. 9. Average number of days from permit issued to final inspection completed. This average includes weekends and days staff is waiting for applicant to schedule the next required inspection. 10.Total Impact Fees collected for new ADU/JADU’s. Years 2015-2016 data point not available. Data from Table 1 shows that 13 ADU/JADU permits were issued in the first two quarters of 2020. In the first two quarters of 2020, the City received a total of 32 ADU building permit applications. Twenty-eight (28) of these ADU applications were for properties within the R-1 single family zone district, while two applications were for properties within the RE zone, and two in the R-2 zones. About 65 percent of the applications filed were for properties in South Palo Alto, South of Page Mill Road/Oregon Expressway. Seventeen (17) ADU applications were for construction of new units, while the remaining 15 applications were for conversions of existing spaces, namely detached garages. The majority of the ADU applications filed were for one- bedroom units. The unit sizes ranged from 208 to 900 square feet, with an average unit size of 450 square feet. ADU applications represent just over 24 percent of the City’s market rate Regional Housing Need Allocation (RHNA) for the current RHNA Cycle. Next Steps On August 17, 2020, Council will also review the updated ordinance with streamlined and simplified ADU/JADU regulations, complying with California’s laws (ID # 11118). The updated ordinance would amend the following PAMC provisions: • Title 18, Chapter 18.04, addressing the applicable definitions, and adopting a new Chapter 18.09 to contain updated zoning regulations for ADUs and JADUs; • Title 16 (Building): Sections 16.58.030 (Exemptions) of Chapter 16.58 (Development Impact Fees), 16.04.300 of Chapter 16.04 (California Building Code), 16.06.240 of Chapter 16.06 (California Residential Code, and 16.14.080 of Chapter 16.14 (California Green Building Standards Code). City of Palo Alto Page 5 Following Council’s adoption of the updated Ordinance, staff anticipates the number of building permits issued for ADUs and JADUs may increase. Resource Impact None. Timeline This is a quarterly report published by the Planning and Development Services Department. Stakeholder Engagement This is a quarterly Informational Report for the City Council and does not require any stakeholder engagements. Environmental Review Construction of ADUs does not require any environmental review. Attachments: Attachment A: List of ADU Permit Applications, Quarter 1 & 2, 2020 Attached Detached Attached Detached Garage Other Accessory Structure/ Space 1 ADU North Palo Alto R-2 01/22/2020 Permit Issued Yes x x 1 370 2 ADU North Palo Alto R-1 02/06/2020 In Plan Check No x x 1 330 3 ADU North Palo Alto R-1 02/06/2020 In Plan Check No x x 1 429 4 ADU North Palo Alto R-1 02/11/2020 In Plan Check No x x 2 647 5 ADU South Palo Alto RE 02/11/2020 Permit Issued Yes x 1 600 6 ADU South Palo Alto R-1 (8000) 02/13/2020 In Plan Check No x x 1 527 7 ADU South Palo Alto R-1 02/13/2020 In Plan Check No x 1 561 8 JADU South Palo Alto R-1 (8000)(S) 02/18/2020 Incomplete x x 0 0 9 ADU South Palo Alto R-1 02/20/2020 In Plan Check No x 2 900 10 ADU South Palo Alto R-1 (7000)(S) 02/26/2020 In Plan Check No x x 0 263 11 ADU North Palo Alto R-1 03/05/2020 In Plan Check No x x 1 350 12 ADU South Palo Alto R-1 03/09/2020 In Plan Check No x x 1 438 13 ADU North Palo Alto R-1 03/10/2020 In Plan Check No x x 1 441 14 ADU South Palo Alto R-1 03/10/2020 In Plan Check No x 1 208 15 ADU South Palo Alto R-1 (S) 03/10/2020 In Plan Check No x 2 748 16 ADU North Palo Alto R-1 03/31/2020 In Plan Check No x 2 799 17 ADU South Palo Alto R-1 (7000)(S) 04/09/2020 In Plan Check No x 1 357 18 ADU South Palo Alto R-1 04/13/2020 In Plan Check No x 1 412 19 ADU South Palo Alto R-1 04/15/2020 In Plan Check No x 2 799 20 ADU South Palo Alto RE 04/16/2020 In Plan Check No x 0 494 21 ADU South Palo Alto R-1 04/29/2020 In Plan Check No x 1 312 Project Location Quarter 2, 2020 Zoning Date Filed Application Status Building Permit Issued Building Permits Applied in 2020 (Q1 & Q2) New Construction Conversion Type of Conversion ADU Size (SQFT) # of Bedrooms DWELLING TYPE Number of Applications Quarter 1, 2020 Page 1 of 2 Attached Detached Attached Detached Garage Other Accessory Structure/ Space Project Location Zoning Date Filed Application Status Building Permit Issued New Construction Conversion Type of Conversion ADU Size (SQFT) # of Bedrooms DWELLING TYPE Number of Applications 22 ADU South Palo Alto R-1 (S) 05/01/2020 In Plan Check No x x 1 405 23 ADU South Palo Alto R-1 05/20/2020 In Plan Check No x 0 625 24 ADU North Palo Alto R-1 05/27/2020 In Plan Check No x 0 521 25 ADU South Palo Alto R-1 06/01/2020 In Plan Check No x 0 327 26 ADU North Palo Alto R-1 06/03/2020 In Plan Check No x x 2 396 27 ADU South Palo Alto R-1 06/04/2020 In Plan Check No x 1 600 28 ADU South Palo Alto R1 06/05/2020 Submitted No x 0 0 29 ADU North Palo Alto R-2 06/17/2020 In Plan Check No x 0 0 30 ADU South Palo Alto R-1 06/24/2020 In Plan Check No x x 0 431 31 ADU North Palo Alto R-1 06/30/2020 Submitted No x x 0 416 32 ADU South Palo Alto R-1 06/30/2020 Submitted No x 0 800 Source: City of Palo Alto Accela Data January 1, 2020 to June 30, 2020. 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