HomeMy WebLinkAbout2019-09-16 City Council Agenda Packet
City Council
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Monday, September 16, 2019
Special Meeting
Council Chambers
5:00 PM
Council Member Tanaka will be Participating From Percolata, 6F,
Maple Plaza Nanhai Road Nanshan, Shenzhen, China 518052
Agenda posted according to PAMC Section 2.04.070. Supporting materials are available in
the Council Chambers on the Thursday 11 days preceding the meeting.
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discussion of the item. You are not required to give your name on the speaker card in order to speak to the Council, but it is very helpful. Public comment may be addressed to the full City Council via email at
City.Council@cityofpaloalto.org.
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in order to best manage the time at a meeting or to adapt to the participation of the public. To ensure
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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
Study Session 5:00-6:00 PM
1. Study Session With the City's Federal Lobbyist Related to Federal
Legislation
Closed Session 6:00-6:30 PM
2. CONFERENCE WITH CITY ATTORNEY-EXISTING LITIGATION
Santa Clara County Superior Court Case No. 18CV328469
(One Case, as Defendant)–Jay Greer v. City of Palo Alto
Authority: Government Code Section 54956.9(d)(1)
2 September 16, 2019
MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA
PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE.
DURING NORMAL BUSINESS HOURS.
Agenda Changes, Additions and Deletions
City Manager Comments 6:30-6:40 PM
Oral Communications 6:40-6:55 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.
Consent Calendar 6:55-7:00 PM
Items will be voted on in one motion unless removed from the calendar by three Council Members.
3.Approval of Contract Number C20174826 With Monterey Mechanical
Co. in an Amount Not-to-Exceed $450,000 to Provide On-call
Emergency and Critical Construction Services at the Regional Water
Quality Control Plant, Wastewater Treatment Fund Capital
Improvement Program Project WQ-19002
4.Approval of a Funding Agreement With the Santa Clara Valley
Transportation Authority (VTA) for 2016 Measure B Local Streets and
Roads Program Funding
5.Approval of Contract Number S19175846 With WRA, Inc. in an Amount
Not-to-Exceed $93,237 to Conduct a Matadero Creek Study for the
North Ventura Coordinated Area Plan (NVCAP)
6.Vote to Endorse the Slate of Candidates for the Peninsula Division’s
Executive Committee for 2018-19 and Direct the City Clerk to Forward
to Seth Miller, the Regional Public Affairs Manager for the Peninsula
Division, League of California Cities the Completed Ballot for the City
of Palo Alto
Action Items
Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials,
Unfinished Business and Council Matters.
7:00-8:00 PM
7.Staff and Utilities Advisory Commission Recommends That the City
Council Adopt a Resolution Amending Rule and Regulation 20 to Allow
Neighborhood Self-funding of Certain Subsurface Equipment
8:00-9:15 PM
8.Evaluation and Discussion of Potential Revenue Generating Ballot
Measures and Confirmation of Finance Committee Recommended
Parameters for Tax Structure and Further Analysis; and Approval of a
Budget Amendment in the General Fund
9:15-10:15 PM
9.Caltrain Business Plan - Direction to Staff Regarding Comments on the
Draft Long Range Service Vision
Q&A
Q&A
Q&A
MEMO
3 September 16, 2019
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.
10:15-10:30 PM
10.Designation of Voting Delegate and Alternate for the League of
California Cities Annual 2019 Conference, to be Held October 16-18,
2019 in Long Beach, CA
State/Federal Legislation Update/Action
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.
MEMO
4 September 16, 2019
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
Council/Standing Committee Meetings
Finance Committee Meeting Cancelled September 17, 2019 Sp. City
Council Meeting Closed Session CANCELLED September 17, 2019
Sp. City School Committee Meeting Cancelled September 19, 2019
Schedule of Meetings
Schedule of Meetings
Tentative Agenda
Tentative Agenda
Informational Report
Proclamation Establishing September 13-22, 2019 as Welcome Week in Palo
Alto
Public Letters to Council
Set 1
City of Palo Alto (ID # 10526)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 9/16/2019
City of Palo Alto Page 1
Summary Title: Contract Approval for On-Call Emergency and Critical
Construction Services
Title: Approval of Contract Number C20174826 With Monterey Mechanical
Co. in an Amount Not-to-Exceed $450,000 to Provide On-call Emergency and
Critical Construction Services at the Regional Water Quality Control Plant -
Wastewater Treatment Fund Capital Improvement Program Project WQ-
19002
From: City Manager
Lead Department: Public Works
Recommendation
Staff recommends that Council approve and authorize the City Manager or his designee to
execute Contract No. C20174826 with Monterey Mechanical Co. (Attachment A) in an amount
not to exceed $450,000 to provide on-call emergency and critical construction services at the
Regional Water Quality Control Plant over a three-year term.
Background
The Regional Water Quality Control Plant (Plant) treats an average of 19 million gallons of
wastewater each day. At times, on-call urgent and emergency construction services are
necessary for maintaining the operation of the Plant. The Plant operates continuously to
provide wastewater treatment, recycled water delivery, and related services to protect public
health and safety.
Discussion
Staff recommends that Council approve the proposed contract with Monterey Mechanical Co.
to provide emergency and critical construction services at the Plant on an on-call basis under a
new three-year contract. These services are above and beyond the capacities of City staff. Work
under the contract would be initiated through the issuance of task orders as required. In
previous on-call emergency construction service contracts, repairs have included (a) numerous
pipe and structural wall leak repairs and replacements; (b) installation and removal of inflatable
blow-up plugs by specialty underwater commercial divers to allow for unit process isolation; (c)
repair of unsafe work conditions; (d) replacement of a damaged sewage sludge conveyor plastic
City of Palo Alto Page 2
liner; (e) replacement of damaged power distribution equipment; (f) repair of a damaged
secondary clarifier mechanism; and (g) repair of damaged isolation stop logs.
On April 17, 2019, the City advertised a notice inviting formal bids for the On-Call Emergency
and Critical Construction Services project. The bidding period was 21 days. On May 7, 2019, one
bid was received from one qualified contractor.
City of Palo Alto Page 3
Summary of Bid Process
Bid Name/Number On-Call Emergency and Critical Construction
Services (IFB-174826)
Proposed Length of Project 3-years after Contract Execution
Number of Bid Packages downloaded by
Contractors 4
Number of Bid Packages downloaded by
Builder’s Exchanges 10
Total Days to Respond to Bid 21
Pre-Bid Meeting Yes
Number of Company Attendees at Pre-Bid
Meeting 3
Number of Bids Received: 1
Bid Price Range $450,000
The original bid submitted by Monterey was reviewed and the hourly rates listed on the bid
form were deemed reasonable. Therefore, the bid was accepted and Monterey was declared
the lowest responsible bidder. Staff confirmed with the Contractor's State License Board the
contractor has an active license on file. Staff also checked references supplied by the contractor
for previous work performed, including projects at the plant and elsewhere in the City, and
found no complaints.
Timeline
Work under the contract will be performed through the issuance of task or work orders which
will specify the timeline for completion of each task. The contract term is three years and the
contract will expire by approximately March 1, 2023.
Resource Impact
Funding for this contract is included in the Fiscal Year 2020 Wastewater Treatment Fund Capital
Improvement Program Project Plant Repair, Retrofit, and Equipment Replacement (WQ-19002).
Policy Implications
This recommendation does not represent any change to existing City policies.
Environmental Review
The recommended action is exempt from review under the California Environmental Quality
Act pursuant to CEQA Guidelines Section 15301 (b), which includes maintenance of publicly-
owned wastewater facilities involving no or negligible expansion.
Attachments:
Attach A - Contract C20174826 Monterey Mech
1 Rev. March 17, 2017
CONSTRUCTION CONTRACT
CONSTRUCTION CONTRACT
Contract No. C20174826
City of Palo Alto
On-Call Emergency & Critical Construction Services Project
2 Rev. March 17, 2017
CONSTRUCTION CONTRACT
CONSTRUCTION CONTRACT
TABLE OF CONTENTS
SECTION 1 INCORPORATION OF RECITALS AND DEFINITIONS…………………………………….…………..6
1.1 Recitals…………………………………………………………………………………………………………………….6
1.2 Definitions……………………………………………………………………………………………………………….6
SECTION 2 THE PROJECT………………………………………………………………………………………………………...6
SECTION 3 THE CONTRACT DOCUMENTS………………………………………………………………………………..7
3.1 List of Documents…………………………………………………………………………………………….........7
3.2 Order of Precedence……………………………………………………………………………………………......7
SECTION 4 CONTRACTOR’S DUTY…………………………………………………………………………………………..8
4.1 Contractor's Duties…………………………………………………………………………………………………..8
4.2 On-Call Provision ……………………………………………………………………………………………………..8
SECTION 5 PROJECT TEAM……………………………………………………………………………………………………..8
5.1 Contractor's Co-operation………………………………………………………………………………………..8
SECTION 6 TIME OF COMPLETION…………………………………………………………………………………….......8
6.1 Time Is of Essence…………………………………………………………………………………………………….8
6.2 Commencement of Work…………………………………………………………………………………………8
6.3 Contract Time…………………………………………………………………………………………………………..8
6.4 Liquidated Damages…………………………………………………………………………………………………8
6.4.1 Other Remedies……………………………………………………………………………………………………..9
6.5 Adjustments to Contract Time………………………………………………………………………………….9
SECTION 7 COMPENSATION TO CONTRACTOR……………………………………………………………………….9
7.1 Contract Sum……………………………………………………………………………………………………………9
7.2 Full Compensation……………………………………………………………………………………………………9
SECTION 8 STANDARD OF CARE……………………………………………………………………………………………10
8.1 Standard of Care…………………………………………………………………………………..……………..…10
SECTION 9 INDEMNIFICATION…………………………………………………………………………………………..…10
9.1 Hold Harmless……………………………………………………………………………………………………….10
9.2 Survival…………………………………………………………………………………………………………………10
SECTION 10 NON-DISCRIMINATION……..………………………………………………………………………………10
10.1 Municipal Code Requirement…………….………………………………..……………………………….10
3 Rev. March 17, 2017
CONSTRUCTION CONTRACT
SECTION 11 INSURANCE AND BONDS.…………………………………………………………………………………11
11.1 Evidence of Coverage…………………………………………………………………………………………..10
SECTION 12 PROHIBITION AGAINST TRANSFERS…………………………………………………………….…11
12.1 Assignment………………………………………………………………………………………………………….11
12.2 Assignment by Law.………………………………………………………………………………………………11
SECTION 13 NOTICES …………………………………………………………………………………………………………….11
13.1 Method of Notice …………………………………………………………………………………………………11
13.2 Notice Recipents ………………………………………………………………………………………………….11
13.3 Change of Address……………………………………………………………………………………………….12
SECTION 14 DEFAULT…………………………………………………………………………………………………………...12
14.1 Notice of Default………………………………………………………………………………………………….12
14.2 Opportunity to Cure Default…………………………………………………………………………………12
SECTION 15 CITY'S RIGHTS AND REMEDIES…………………………………………………………………………..13
15.1 Remedies Upon Default……………………………………………………………………………………….13
15.1.1 Delete Certain Services…………………………………………………………………………………….13
15.1.2 Perform and Withhold……………………………………………………………………………………..13
15.1.3 Suspend The Construction Contract…………………………………………………………………13
15.1.4 Terminate the Construction Contract for Default………………………………………………13
15.1.5 Invoke the Performance Bond………………………………………………………………………….13
15.1.6 Additional Provisions……………………………………………………………………………………….13
15.2 Delays by Sureties……………………………………………………………………………………………….13
15.3 Damages to City…………………………………………………………………………………………………..14
15.3.1 For Contractor's Default…………………………………………………………………………………..14
15.3.2 Compensation for Losses…………………………………………………………………………………14
15.4 Suspension by City……………………………………………………………………………………………….14
15.4.1 Suspension for Convenience……………………………………………………………………………..14
15.4.2 Suspension for Cause………………………………………………………………………………………..14
15.5 Termination Without Cause…………………………………………………………………………………15
15.5.1 Compensation………………………………………………………………………………………………….15
15.5.2 Subcontractors………………………………………………………………………………………………..15
15.6 Contractor’s Duties Upon Termination………………………………………………………………...15
SECTION 16 CONTRACTOR'S RIGHTS AND REMEDIES……………………………………………………………16
4 Rev. March 17, 2017
CONSTRUCTION CONTRACT
16.1 Contractor’s Remedies……………………………………..………………………………..………………….16
16.1.1 For Work Stoppage……………………………………………………………………………………………16
16.1.2 For City's Non-Payment…………………………………………………………………………………….16
16.2 Damages to Contractor………………………………………………………………………………………..16
SECTION 17 ACCOUNTING RECORDS………………………………………………………………………………….…16
17.1 Financial Management and City Access………………………………………………………………..16
17.2 Compliance with City Requests…………………………………………………………………………….17
SECTION 18 INDEPENDENT PARTIES……………………………………………………………………………………..17
18.1 Status of Parties……………………………………………………………………………………………………17
SECTION 19 NUISANCE……………………………………………………………………………………………………….…17
19.1 Nuisance Prohibited……………………………………………………………………………………………..17
SECTION 20 PERMITS AND LICENSES…………………………………………………………………………………….17
20.1 Payment of Fees…………………………………………………………………………………………………..17
SECTION 21 WAIVER…………………………………………………………………………………………………………….17
21.1 Waiver………………………………………………………………………………………………………………….17
SECTION 22 GOVERNING LAW AND VENUE; COMPLIANCE WITH LAWS……………………………….18
22.1 Governing Law…………………………………………………………………………………………………….18
22.2 Compliance with Laws…………………………………………………………………………………………18
22.2.1 Palo Alto Minimum Wage Ordinance…………….………………………………………………….18
SECTION 23 COMPLETE AGREEMENT……………………………………………………………………………………18
23.1 Integration………………………………………………………………………………………………………….18
SECTION 24 SURVIVAL OF CONTRACT…………………………………………………………………………………..18
24.1 Survival of Provisions……………………………………………………………………………………………18
SECTION 25 PREVAILING WAGES………………………………………………………………………………………….18
SECTION 26 NON-APPROPRIATION……………………………………………………………………………………….19
26.1 Appropriation………………………………………………………………………………………………………19
SECTION 27 AUTHORITY……………………………………………………………………………………………………….19
27.1 Representation of Parties…………………………………………………………………………………….19
SECTION 28 COUNTERPARTS………………………………………………………………………………………………..19
28.1 Multiple Counterparts………………………………………………………………………………………….19
SECTION 29 SEVERABILITY……………………………………………………………………………………………………19
29.1 Severability………………………………………………………………………………………………………….19
5 Rev. March 17, 2017
CONSTRUCTION CONTRACT
SECTION 30 STATUTORY AND REGULATORY REFERENCES …………………………………………………..19
30.1 Amendments of Laws…………………………………………………………………………………………..19
SECTION 31 WORKERS’ COMPENSATION CERTIFICATION………………………………………………….….19
31.1 Workers Compensation…………………………………………………………………………………….19
SECTION 32 DIR REGISTRATION AND OTHER SB 854 REQUIREMENTS………………………………..…20
32.1 General Notice to Contractor…………………………………………………………………………….20
32.2 Labor Code section 1771.1(a)…………………………………………………………………………….20
32.3 DIR Registration Required…………………………………………………………………………………20
32.4 Posting of Job Site Notices…………………………………………………………………………………20
32.5 Payroll Records…………………………………………………………………………………………………20
6 Rev. March 17, 2017
CONSTRUCTION CONTRACT
CONSTRUCTION CONTRACT
THIS CONSTRUCTION CONTRACT entered into on September 16, 2019 (“Execution Date”) by and between
the CITY OF PALO ALTO, a California chartered municipal corporation ("City"), and MONTEREY MECHANICAL
CO. ("Contractor"), is made with reference to the following:
R E C I T A L S:
A. City is a municipal corporation duly organized and validly existing under the laws of the State of
California with the power to carry on its business as it is now being conducted under the statutes of the
State of California and the Charter of City.
B. Contractor is a Corporation duly organized and in good standing in the State of California,
Contractor’s License Number 388361 and Department of Industrial Relations Registration Number
1000001627. Contractor represents that it is duly licensed by the State of California and has the
background, knowledge, experience and expertise to perform the obligations set forth in this Construction
Contract.
C. On April 17, 2019, City issued an Invitation for Bids (IFB) to contractors for the On-Call Emergency
And Critical Construction Services for the provision of construction services on an on-call emergency basis
(“Project”). In response to the IFB, Contractor submitted a Bid.
D. City and Contractor desire to enter into this Construction Contract for the Project, and other
services as identified in the Contract Documents for the Project upon the following terms and conditions.
NOW THEREFORE, in consideration of the mutual promises and undertakings hereinafter set forth
and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, it is mutually agreed by and between the undersigned parties as follows:
SECTION 1 INCORPORATION OF RECITALS AND DEFINITIONS.
1.1 Recitals.
All of the recitals are incorporated herein by reference.
1.2 Definitions.
Capitalized terms shall have the meanings set forth in this Construction Contract and/or in the General
Conditions. If there is a conflict between the definitions in this Construction Contract and in the General
Conditions, the definitions in this Construction Contract shall prevail.
SECTION 2 THE PROJECT.
The Project is the On-Call Emergency And Critical Construction Services, for the Regional Water Quality
Control Plant (RWQCP) located at 2501 Embarcadero Way, Palo Alto, CA. ("Project"). The Project calls for the
Contractor to respond to the City’s request for emergency construction services, as needed from time to
time, at the City’s RWQCP over a three-year period of time (the Work).
7 Rev. March 17, 2017
CONSTRUCTION CONTRACT
SECTION 3 THE CONTRACT DOCUMENTS.
3.1 List of Documents.
The Contract Documents (sometimes collectively referred to as “Agreement” or “Bid Documents”) consist of
the following documents which are on file with the Purchasing Division and are hereby incorporated by
reference.
1) Change Orders
2) Field Orders
3) Contract
4) Task Orders
5) Bidding Addenda
6) Special Provisions
7) General Conditions
7) Project Plans and Drawings
8) Technical Specifications
9) Instructions to Bidders
10) Invitation for Bids
11) Contractor's Bid/Non-Collusion Declaration
12) Reports listed in the Contract Documents
13) Public Works Department’s Standard Drawings and Specifications (most current version at
time of Bid)
14) Utilities Department’s Water, Gas, Wastewater, Electric Utilities Standards (most current
version at time of Bid)
15) City of Palo Alto Traffic Control Requirements
16) City of Palo Alto Truck Route Map and Regulations
17) Notice Inviting Pre-Qualification Statements, Pre-Qualification Statement, and Pre-
Qualification Checklist (if applicable)
18) Performance and Payment Bonds
3.2 Order of Precedence.
For the purposes of construing, interpreting and resolving inconsistencies between and among the
provisions of this Contract, the Contract Documents shall have the order of precedence as set forth in the
preceding section. If a claimed inconsistency cannot be resolved through the order of precedence, the City
8 Rev. March 17, 2017
CONSTRUCTION CONTRACT
shall have the sole power to decide which document or provision shall govern as may be in the best interests
of the City.
SECTION 4 CONTRACTOR’S DUTY.
4.1 Contractor’s Duties
Contractor agrees to perform all of the Work required for the Project, as specified in the Contract
Documents, all of which are fully incorporated herein. Contractor shall provide, furnish, and supply all things
necessary and incidental for the timely performance and completion of the Work, including, but not limited
to, provision of all necessary labor, materials, equipment, transportation, and utilities, unless otherwise
specified in the Contract Documents. Contractor also agrees to use its best efforts to complete the Work in
a professional and expeditious manner and to meet or exceed the performance standards required by the
Contract Documents.
4.2 ON- CALL PROVISION
Services performed under the Contract will be performed over a three-year period, on an on-call basis, as
requested by the City from time to time, as needed, with a Task Order assigned and approved by the City’s
Project Manager. Each Task Order shall be in substantially the same form as Exhibit A-1. Each Task Order
shall designate a City Project Manager and shall contain a specific scope of work, a specific schedule of
performance, and a specific compensation amount (“the Task Order Compensation Amount”). The overall
total price of all Task Orders issued under this Agreement shall not exceed the overall amount of
Compensation set forth in Section 7 of this Agreement. CONTRACTOR shall only be compensated for work
performed under an authorized Task Order and the City may elect, but is not required, to authorize work up
to the maximum compensation amounts set forth in Section 7.
SECTION 5 PROJECT TEAM.
5.1 Contractor’s Co-operation.
In addition to Contractor, City has retained, or may retain, consultants and contractors to provide
professional and technical consultation for the design and construction of the Project. The Contract requires
that Contractor operate efficiently, effectively and cooperatively with City as well as all other members of
the Project Team and other contractors retained by City to construct other portions of the Project.
SECTION 6 TIME OF COMPLETION.
6.1 Time Is of Essence.
Time is of the essence with respect to all time limits set forth in the Contract Documents.
6.2 Commencement of Work.
Contractor shall commence the Work on the date specified in City’s Notice to Proceed for each on-call
construction project by Task Order.
6.3 Contract Term and Contract Time.
The overall Contract period is three years. Work hereunder shall begin on the date specified on the City’s
Notice to Proceed, and the specific work authorized by each Task Order shall be completed no later than
9 Rev. March 17, 2017
CONSTRUCTION CONTRACT
the time/schedule requirements specified therein, and in conformance with Section 2.4 “Delivery of
Services”, of the Project Technical Specifications.
6.4 Liquidated Damages.
Pursuant to Government Code Section 53069.85, if Contractor fails to achieve Substantial Completion of
any Specific Work authorized by a Task Order within the authorized Task Order Schedule of Performance
time, including any approved extensions thereto, City may assess liquidated damages on a daily basis for
each day of Unexcused Delay in achieving Substantial Completion, based on the amount of One Thousand
dollars ($1,000) per day, or as otherwise specified in the Special Provisions. Liquidated damages may also
be separately assessed for failure to meet milestones specified elsewhere in the Contract Documents,
regardless of impact on the time for achieving Substantial Completion. The assessment of liquidated
damages is not a penalty but considered to be a reasonable estimate of the amount of damages City will
suffer by delay in completion of the Task Order Work. The City is entitled to setoff the amount of
liquidated damages assessed against any payments otherwise due to Contractor, including, but not limited
to, setoff against release of retention. If the total amount of liquidated damages assessed exceeds the
amount of unreleased retention, City is entitled to recover the balance from Contractor or its sureties.
Occupancy or use of the Project in whole or in part prior to Substantial Completion, shall not operate as a
waiver of City’s right to assess liquidated damages.
6.4.1 Other Remedies. City is entitled to any and all available legal and equitable remedies City may
have where City’s Losses are caused by any reason other than Contractor’s failure to achieve Substantial
Completion of the entire Work within the Contract Time.
6.5 Adjustments to Contract Time.
The Contract Time may only be adjusted for time extensions approved by City and memorialized in a
Change Order approved in accordance with the requirements of the Contract Documents.
SECTION 7 COMPENSATION TO CONTRACTOR.
7.1 Maximum Compensation and Contract Sum.
Contractor shall be compensated for satisfactory completion of the Work in compliance with the Contract
Documents the Contract Sum not to exceed Four Hundred Fifty Thousand Dollars ($450,000) for the
Contract term.
Contractor will be compensated for satisfactory completion of the Work in each Task Order
for the Contract Sum specified in the Task Order.
7.2 Full Compensation.
The Task Order Compensation amount, as approved for each Task Order shall be full compensation to
Contractor for all Work provided by Contractor and, except as otherwise expressly permitted by the terms
of the Contract Documents, shall cover all Losses arising out of the nature of the Work or from the acts of
the elements or any unforeseen difficulties or obstructions which may arise or be encountered in
performance of the Work until its Acceptance by City, all risks connected with the Work, and any and all
expenses incurred due to suspension or discontinuance of the Work, except as expressly provided herein.
The Task Order Compensation amount may only be adjusted for Change Orders approved in accordance with
the requirements of the Contract Documents.
10 Rev. March 17, 2017
CONSTRUCTION CONTRACT
SECTION 8 STANDARD OF CARE.
8.1 Standard of Care.
Contractor agrees that the Work shall be performed by qualified, experienced and well-supervised
personnel. All services performed in connection with this Construction Contract shall be performed in a
manner consistent with the standard of care under California law applicable to those who specialize in
providing such services for projects of the type, scope and complexity of the Project.
SECTION 9 INDEMNIFICATION.
9.1 Hold Harmless.
To the fullest extent allowed by law, Contractor will defend, indemnify, and hold harmless City, its City
Council, boards and commissions, officers, agents, employees, representatives and volunteers (hereinafter
individually referred to as an “Indemnitee” and collectively referred to as "Indemnitees"), through legal
counsel acceptable to City, from and against any and liability, loss, damage, claims, expenses (including,
without limitation, attorney fees, expert witness fees, paralegal fees, and fees and costs of litigation or
arbitration) (collectively, “Liability”) of every nature arising out of or in connection with the acts or omissions
of Contractor, its employees, Subcontractors, representatives, or agents, in performing the Work or its
failure to comply with any of its obligations under the Contract, except such Liability caused by the active
negligence, sole negligence, or willful misconduct of an Indemnitee. Contractor shall pay City for any costs
City incurs to enforce this provision. Except as provided in Section 9.2 below, nothing in the Contract
Documents shall be construed to give rise to any implied right of indemnity in favor of Contractor against
City or any other Indemnitee.
Pursuant to Public Contract Code Section 9201, City shall timely notify Contractor upon receipt of
any third-party claim relating to the Contract.
9.2 Survival.
The provisions of Section 9 shall survive the termination of this Construction Contract.
SECTION 10 NON-DISCRIMINATION.
10.1 Municipal Code Requirement.
As set forth in Palo Alto Municipal Code section 2.30.510, Contractor certifies that in the performance of this
Agreement, it shall not discriminate in the employment of any person because of the race, skin color, gender,
age, religion, disability, national origin, ancestry, sexual orientation, housing status, marital status, familial
status, weight or height of such person. Contractor acknowledges that it has read and understands the
provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements
and the penalties for violation thereof, and will comply with all requirements of Section 2.30.510 pertaining
to nondiscrimination in employment.
11 Rev. March 17, 2017
CONSTRUCTION CONTRACT
SECTION 11 INSURANCE AND BONDS.
11.1 Evidence of coverage.
Within ten (10) business days following issuance of the Notice of Award, Contractor shall provide City with
evidence that it has obtained insurance and shall submit Performance and Payment Bonds satisfying all
requirements in Article 11 of the General Conditions.
SECTION 12 PROHIBITION AGAINST TRANSFERS.
12.1 Assignment.
City is entering into this Construction Contract in reliance upon the stated experience and qualifications of
the Contractor and its Subcontractors set forth in Contractor’s Bid. Accordingly, Contractor shall not assign,
hypothecate or transfer this Construction Contract or any interest therein directly or indirectly, by operation
of law or otherwise without the prior written consent of City. Any assignment, hypothecation or transfer
without said consent shall be null and void, and shall be deemed a substantial breach of contract and grounds
for default in addition to any other legal or equitable remedy available to the City.
12.2 Assignment by Law.
The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of
Contractor or of any general partner or joint venturer or syndicate member of Contractor, if the Contractor
is a partnership or joint venture or syndicate or co-tenancy shall result in changing the control of Contractor,
shall be construed as an assignment of this Construction Contract. Control means more than fifty percent
(50%) of the voting power of the corporation or other entity.
SECTION 13 NOTICES.
13.1 Method of Notice.
All notices, demands, requests or approvals to be given under this Construction Contract shall be given in
writing and shall be deemed served on the earlier of the following:
(i) On the date delivered if delivered personally;
(ii) On the third business day after the deposit thereof in the United States mail, postage prepaid, and
addressed as hereinafter provided;
(iii) On the date sent if sent by facsimile transmission;
(iv) On the date sent if delivered by electronic mail; or
(v) On the date it is accepted or rejected if sent by certified mail.
13.2 Notice to Recipients.
All notices, demands or requests (including, without limitation, Change Order Requests and Claims) from
Contractor to City shall include the Project name and the number of this Construction Contract and shall be
addressed to City at:
To City: City of Palo Alto
City Clerk
250 Hamilton Avenue
P.O. Box 10250
Palo Alto, CA 94303
12 Rev. March 17, 2017
CONSTRUCTION CONTRACT
Copy to: City of Palo Alto
Regional Water Quality Control Plant
2501 Embarcadero Way
Palo Alto, CA 94303
Attn: Tom Kapushinski
AND
[Include Construction Manager, If Applicable.]
City of Palo Alto
Utilities Engineering
250 Hamilton Avenue
Palo Alto, CA 94301
Attn:
In addition, copies of all Claims by Contractor under this Construction Contract shall be provided to the
following:
Palo Alto City Attorney’s Office
250 Hamilton Avenue
P.O. Box 10250
Palo Alto, California 94303
All Claims shall be sent by registered mail or certified mail with return receipt requested.
All notices, demands, requests or approvals from City to Contractor shall be addressed to:
MONTEREY MECHANICAL
ATTN: JAMES TROUP
8275 SAN LEANDRO STREET
OAKLAND, CA 94621
13.3 Change of Address.
In advance of any change of address, Contractor shall notify City of the change of address in writing. Each
party may, by written notice only, add, delete or replace any individuals to whom and addresses to which
notice shall be provided.
SECTION 14 DEFAULT.
14.1 Notice of Default.
In the event that City determines, in its sole discretion, that Contractor has failed or refused to perform any
of the obligations set forth in the Contract Documents, or is in breach of any provision of the Contract
Documents, City may give written notice of default to Contractor in the manner specified for the giving of
notices in the Construction Contract, with a copy to Contractor’s performance bond surety.
14.2 Opportunity to Cure Default.
13 Rev. March 17, 2017
CONSTRUCTION CONTRACT
Except for emergencies, Contractor shall cure any default in performance of its obligations under the
Contract Documents within two (2) Days (or such shorter time as City may reasonably require) after receipt
of written notice. However, if the breach cannot be reasonably cured within such time, Contractor will
commence to cure the breach within two (2) Days (or such shorter time as City may reasonably require) and
will diligently and continuously prosecute such cure to completion within a reasonable time, which shall in
no event be later than ten (10) Days after receipt of such written notice.
SECTION 15 CITY'S RIGHTS AND REMEDIES.
15.1 Remedies Upon Default.
If Contractor fails to cure any default of this Construction Contract within the time period set forth above in
Section 14, then City may pursue any remedies available under law or equity, including, without limitation,
the following:
15.1.1 Delete Certain Services. City may, without terminating the Construction Contract, delete
certain portions of the Work, reserving to itself all rights to Losses related thereto.
15.1.2 Perform and Withhold. City may, without terminating the Construction Contract, engage
others to perform the Work or portion of the Work that has not been adequately performed by
Contractor and withhold the cost thereof to City from future payments to Contractor, reserving to
itself all rights to Losses related thereto.
15.1.3 Suspend The Construction Contract. City may, without terminating the Construction
Contract and reserving to itself all rights to Losses related thereto, suspend all or any portion of this
Construction Contract for as long a period of time as City determines, in its sole discretion,
appropriate, in which event City shall have no obligation to adjust the Contract Sum or Contract
Time, and shall have no liability to Contractor for damages if City directs Contractor to resume Work.
15.1.4 Terminate the Construction Contract for Default. City shall have the right to terminate
this Construction Contract, in whole or in part, upon the failure of Contractor to promptly cure any
default as required by Section 14. City’s election to terminate the Construction Contract for default
shall be communicated by giving Contractor a written notice of termination in the manner specified
for the giving of notices in the Construction Contract. Any notice of termination given to Contractor
by City shall be effective immediately, unless otherwise provided therein.
15.1.5 Invoke the Performance Bond. City may, with or without terminating the Construction
Contract and reserving to itself all rights to Losses related thereto, exercise its rights under the
Performance Bond.
15.1.6 Additional Provisions. All of City’s rights and remedies under this Construction Contract
are cumulative, and shall be in addition to those rights and remedies available in law or in equity.
Designation in the Contract Documents of certain breaches as material shall not waive the City’s
authority to designate other breaches as material nor limit City’s right to terminate the Construction
Contract, or prevent the City from terminating the Agreement for breaches that are not material.
City’s determination of whether there has been noncompliance with the Construction Contract so
as to warrant exercise by City of its rights and remedies for default under the Construction Contract,
shall be binding on all parties. No termination or action taken by City after such termination shall
prejudice any other rights or remedies of City provided by law or equity or by the Contract
Documents upon such termination; and City may proceed against Contractor to recover all
liquidated damages and Losses suffered by City.
15.2 Delays by Sureties.
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CONSTRUCTION CONTRACT
Time being of the essence in the performance of the Work, if Contractor’s surety fails to arrange for
completion of the Work in accordance with the Performance Bond, within seven (7) calendar days from the
date of the notice of termination, Contractor’s surety shall be deemed to have waived its right to complete
the Work under the Contract, and City may immediately make arrangements for the completion of the Work
through use of its own forces, by hiring a replacement contractor, or by any other means that City determines
advisable under the circumstances. Contractor and its surety shall be jointly and severally liable for any
additional cost incurred by City to complete the Work following termination. In addition, City shall have the
right to use any materials, supplies, and equipment belonging to Contractor and located at the Worksite for
the purposes of completing the remaining Work.
15.3 Damages to City.
15.3.1 For Contractor's Default. City will be entitled to recovery of all Losses under law or equity
in the event of Contractor’s default under the Contract Documents.
15.3.2 Compensation for Losses. In the event that City's Losses arise from Contractor’s default
under the Contract Documents, City shall be entitled to deduct the cost of such Losses from monies
otherwise payable to Contractor. If the Losses incurred by City exceed the amount payable,
Contractor shall be liable to City for the difference and shall promptly remit same to City.
15.4 Suspension by City
15.4.1 Suspension for Convenience. City may, at any time and from time to time, without cause,
order Contractor, in writing, to suspend, delay, or interrupt the Work in whole or in part for such
period of time, up to an aggregate of fifty percent (50%) of the Contract Time. The order shall be
specifically identified as a Suspension Order by City. Upon receipt of a Suspension Order, Contractor
shall, at City’s expense, comply with the order and take all reasonable steps to minimize costs
allocable to the Work covered by the Suspension Order. During the Suspension or extension of the
Suspension, if any, City shall either cancel the Suspension Order or, by Change Order, delete the
Work covered by the Suspension Order. If a Suspension Order is canceled or expires, Contractor
shall resume and continue with the Work. A Change Order will be issued to cover any adjustments
of the Contract Sum or the Contract Time necessarily caused by such suspension. A Suspension
Order shall not be the exclusive method for City to stop the Work.
15.4.2 Suspension for Cause. In addition to all other remedies available to City, if Contractor fails
to perform or correct work in accordance with the Contract Documents, City may immediately order
the Work, or any portion thereof, suspended until the cause for the suspension has been eliminated
to City’s satisfaction. Contractor shall not be entitled to an increase in Contract Time or Contract
Price for a suspension occasioned by Contractor’s failure to comply with the Contract Documents.
City’s right to suspend the Work shall not give rise to a duty to suspend the Work, and City’s failure
to suspend the Work shall not constitute a defense to Contractor’s failure to comply with the
requirements of the Contract Documents.
15 Rev. March 17, 2017
CONSTRUCTION CONTRACT
15.5 Termination Without Cause.
City may, at its sole discretion and without cause, terminate this Construction Contract in part or in whole
upon written notice to Contractor. Upon receipt of such notice, Contractor shall, at City’s expense, comply
with the notice and take all reasonable steps to minimize costs to close out and demobilize. The
compensation allowed under this Paragraph 15.5 shall be the Contractor’s sole and exclusive compensation
for such termination and Contractor waives any claim for other compensation or Losses, including, but not
limited to, loss of anticipated profits, loss of revenue, lost opportunity, or other consequential, direct,
indirect or incidental damages of any kind resulting from termination without cause. Termination pursuant
to this provision does not relieve Contractor or its sureties from any of their obligations for Losses arising
from or related to the Work performed by Contractor.
15.5.1 Compensation. Following such termination and within forty-five (45) Days after receipt of
a billing from Contractor seeking payment of sums authorized by this Paragraph 15.5.1, City shall
pay the following to Contractor as Contractor’s sole compensation for performance of the Work :
.1 For Work Performed. The amount of the Contract Sum allocable to the portion of the
Work properly performed by Contractor as of the date of termination, less sums previously paid to
Contractor.
.2 For Close-out Costs. Reasonable costs of Contractor and its Subcontractors:
(i) Demobilizing and
(ii) Administering the close-out of its participation in the Project (including, without
limitation, all billing and accounting functions, not including attorney or expert fees) for a
period of no longer than thirty (30) Days after receipt of the notice of termination.
.3 For Fabricated Items. Previously unpaid cost of any items delivered to the Project Site
which were fabricated for subsequent incorporation in the Work.
.4 Profit Allowance. An allowance for profit calculated as four percent (4%) of the sum of
the above items, provided Contractor can prove a likelihood that it would have made a profit if the
Construction Contract had not been terminated.
15.5.2 Subcontractors. Contractor shall include provisions in all of its subcontracts, purchase
orders and other contracts permitting termination for convenience by Contractor on terms that are
consistent with this Construction Contract and that afford no greater rights of recovery against
Contractor than are afforded to Contractor against City under this Section.
15.6 Contractor’s Duties Upon Termination.
Upon receipt of a notice of termination for default or for convenience, Contractor shall, unless the notice
directs otherwise, do the following:
(i) Immediately discontinue the Work to the extent specified in the notice;
(ii) Place no further orders or subcontracts for materials, equipment, services or facilities,
except as may be necessary for completion of such portion of the Work that is not
discontinued;
(iii) Provide to City a description in writing, no later than fifteen (15) days after receipt of the
notice of termination, of all subcontracts, purchase orders and contracts that are
outstanding, including, without limitation, the terms of the original price, any changes,
payments, balance owing, the status of the portion of the Work covered and a copy of the
subcontract, purchase order or contract and any written changes, amendments or
modifications thereto, together with such other information as City may determine
necessary in order to decide whether to accept assignment of or request Contractor to
terminate the subcontract, purchase order or contract;
16 Rev. March 17, 2017
CONSTRUCTION CONTRACT
(iv) Promptly assign to City those subcontracts, purchase orders or contracts, or portions
thereof, that City elects to accept by assignment and cancel, on the most favorable terms
reasonably possible, all subcontracts, purchase orders or contracts, or portions thereof,
that City does not elect to accept by assignment; and
(v) Thereafter do only such Work as may be necessary to preserve and protect Work already
in progress and to protect materials, plants, and equipment on the Project Site or in transit
thereto.
Upon termination, whether for cause or for convenience, the provisions of the Contract Documents
remain in effect as to any Claim, indemnity obligation, warranties, guarantees, submittals of as-built
drawings, instructions, or manuals, or other such rights and obligations arising prior to the
termination date.
SECTION 16 CONTRACTOR'S RIGHTS AND REMEDIES.
16.1 Contractor’s Remedies.
Contractor may terminate this Construction Contract only upon the occurrence of one of the following:
16.1.1 For Work Stoppage. The Work is stopped for sixty (60) consecutive Days, through no act
or fault of Contractor, any Subcontractor, or any employee or agent of Contractor or any
Subcontractor, due to issuance of an order of a court or other public authority other than City having
jurisdiction or due to an act of government, such as a declaration of a national emergency making
material unavailable. This provision shall not apply to any work stoppage resulting from the City’s
issuance of a suspension notice issued either for cause or for convenience.
16.1.2 For City's Non-Payment. If City does not make pay Contractor undisputed sums within
ninety (90) Days after receipt of notice from Contractor, Contractor may terminate the Construction
Contract (30) days following a second notice to City of Contractor’s intention to terminate the
Construction Contract.
16.2 Damages to Contractor.
In the event of termination for cause by Contractor, City shall pay Contractor the sums provided for in
Paragraph 15.5.1 above. Contractor agrees to accept such sums as its sole and exclusive compensation
and agrees to waive any claim for other compensation or Losses, including, but not limited to, loss of
anticipated profits, loss of revenue, lost opportunity, or other consequential, direct, indirect and incidental
damages, of any kind.
SECTION 17 ACCOUNTING RECORDS.
17.1 Financial Management and City Access.
Contractor shall keep full and detailed accounts and exercise such controls as may be necessary for proper
financial management under this Construction Contract in accordance with generally accepted accounting
principles and practices. City and City's accountants during normal business hours, may inspect, audit and
copy Contractor's records, books, estimates, take-offs, cost reports, ledgers, schedules, correspondence,
instructions, drawings, receipts, subcontracts, purchase orders, vouchers, memoranda and other data
relating to this Project. Contractor shall retain these documents for a period of three (3) years after the later
of (i) Final Payment or (ii) final resolution of all Contract Disputes and other disputes, or (iii) for such longer
period as may be required by law.
17 Rev. March 17, 2017
CONSTRUCTION CONTRACT
17.2 Compliance with City Requests.
Contractor's compliance with any request by City pursuant to this Section 17 shall be a condition precedent
to filing or maintenance of any legal action or proceeding by Contractor against City and to Contractor's right
to receive further payments under the Contract Documents. City many enforce Contractor’s obligation to
provide access to City of its business and other records referred to in Section 17.1 for inspection or copying
by issuance of a writ or a provisional or permanent mandatory injunction by a court of competent
jurisdiction based on affidavits submitted to such court, without the necessity of oral testimony.
SECTION 18 INDEPENDENT PARTIES.
18.1 Status of parties.
Each party is acting in its independent capacity and not as agents, employees, partners, or joint ventures’ of
the other party. City, its officers or employees shall have no control over the conduct of Contractor or its
respective agents, employees, subconsultants, or subcontractors, except as herein set forth.
SECTION 19 NUISANCE.
19.1 Nuisance Prohibited.
Contractor shall not maintain, commit, nor permit the maintenance or commission of any nuisance in
connection in the performance of services under this Construction Contract.
SECTION 20 PERMITS AND LICENSES.
20.1 Payment of Fees.
Except as otherwise provided in the Special Provisions and Technical Specifications, The Contractor shall
provide, procure and pay for all licenses, permits, and fees, required by the City or other government
jurisdictions or agencies necessary to carry out and complete the Work. Payment of all costs and expenses
for such licenses, permits, and fees shall be included in one or more Bid items. No other compensation shall
be paid to the Contractor for these items or for delays caused by non-City inspectors or conditions set forth
in the licenses or permits issued by other agencies.
SECTION 21 WAIVER.
21.1 Waiver.
A waiver by either party of any breach of any term, covenant, or condition contained herein shall not be
deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition
contained herein, whether of the same or a different character.
18 Rev. March 17, 2017
CONSTRUCTION CONTRACT
SECTION 22 GOVERNING LAW AND VENUE; COMPLIANCE WITH LAWS.
22.1 Governing Law.
This Construction Contract shall be construed in accordance with and governed by the laws of the State of
California, and venue shall be in a court of competent jurisdiction in the County of Santa Clara, and no other
place.
22.2 Compliance with Laws.
Contractor shall comply with all applicable federal and California laws and city laws, including, without
limitation, ordinances and resolutions, in the performance of work under this Construction Contract.
22.2.1 Palo Alto Minimum Wage Ordinance. Contractor shall comply with all requirements of
the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from
time to time. In particular, for any employee otherwise entitled to the State minimum wage, who
performs at least two (2) hours of work in a calendar week within the geographic boundaries of the
City, Contractor shall pay such employees no less than the minimum wage set forth in Palo Alto
Municipal Code section 4.62.030 for each hour worked within the geographic boundaries of the City
of Palo Alto. In addition, Contractor shall post notices regarding the Palo Alto Minimum Wage
Ordinance in accordance with Palo Alto Municipal Code section 4.62.060.
SECTION 23 COMPLETE AGREEMENT.
23.1 Integration.
This Agreement represents the entire and integrated agreement between the parties and supersedes all
prior negotiations, representations, and contracts, either written or oral. This Agreement may be amended
only by a written instrument, which is signed by the parties.
SECTION 24 SURVIVAL OF CONTRACT.
24.1 Survival of Provisions.
The provisions of the Construction Contract which by their nature survive termination of the Construction
Contract or Final Completion, including, without limitation, all warranties, indemnities, payment obligations,
and City’s right to audit Contractor’s books and records, shall remain in full force and effect after Final
Completion or any termination of the Construction Contract.
SECTION 25 PREVAILING WAGES.
This Project is not subject to prevailing wages. Contractor is not required to pay prevailing wages in the
performance and implementation of the Project in accordance with SB 7, if the public works contract does
not include a project of $25,000 or less, when the project is for construction work, or the contract does not
include a project of $15,000 or less, when the project is for alteration, demolition, repair, or maintenance
(collectively, ‘improvement’) work.
Or
Contractor is required to pay general prevailing wages as defined in Subchapter 3, Title 8 of the California
Code of Regulations and Section 16000 et seq. and Section 1773.1 of the California Labor Code. Pursuant to
the provisions of Section 1773 of the Labor Code of the State of California, the City Council has obtained the
general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality
19 Rev. March 17, 2017
CONSTRUCTION CONTRACT
for each craft, classification, or type of worker needed to execute the contract for this Project from the
Director of the Department of Industrial Relations (“DIR”). Copies of these rates may be obtained at the
Purchasing Division’s office of the City of Palo Alto. Contractor shall provide a copy of prevailing wage rates
to any staff or subcontractor hired, and shall pay the adopted prevailing wage rates as a
minimum. Contractor shall comply with the provisions of all sections, including, but not limited to, Sections
1775, 1776, 1777.5, 1782, 1810, and 1813, of the Labor Code pertaining to prevailing wages.
SECTION 26 NON-APPROPRIATION.
26.1 Appropriations.
This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto
Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the
event that the City does not appropriate funds for the following fiscal year for this event, or (b) at any time
within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for
this Construction Contract are no longer available. This section shall take precedence in the event of a
conflict with any other covenant, term, condition, or provision of this Agreement.
SECTION 27 AUTHORITY.
27.1 Representation of Parties.
The individuals executing this Agreement represent and warrant that they have the legal capacity and
authority to do so on behalf of their respective legal entities.
SECTION 28 COUNTERPARTS
28.1 Multiple Counterparts.
This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties,
constitute a single binding agreement.
SECTION 29 SEVERABILITY.
29.1 Severability.
In case a provision of this Construction Contract is held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not be affected.
SECTION 30 STATUTORY AND REGULATORY REFERENCES.
30.1 Amendments to Laws.
With respect to any amendments to any statutes or regulations referenced in these Contract Documents,
the reference is deemed to be the version in effect on the date that the Contract was awarded by City,
unless otherwise required by law.
SECTION 31 WORKERS’ COMPENSATION CERTIFICATION.
31.1 Workers Compensation.
Pursuant to Labor Code Section 1861, by signing this Contract, Contractor certifies as follows:
20 Rev. March 17, 2017
CONSTRUCTION CONTRACT
“I am aware of the provisions of Section 3700 of the Labor Code which require every employer to be
insured against liability for workers’ compensation or to undertake self-insurance in accordance with the
provisions of that code, and I will comply with such provisions before commencing the performance of the
Work on this Contract.”
SECTION 32 DIR REGISTRATION AND OTHER SB 854 REQUIREMENTS.
32.1 General Notice to Contractor.
City requires Contractor and its listed subcontractors to comply with the requirements of SB 854.
32.2 Labor Code section 1771.1(a)
City provides notice to Contractor of the requirements of California Labor Code section 1771.1(a), which
reads:
“A contractor or subcontractor shall not be qualified to bid on, be listed in a bid proposal, subject to the
requirements of Section 4104 of the Public Contract Code, or engage in the performance of any contract for
public work, as defined in this chapter, unless currently registered and qualified to perform public work
pursuant to Section 1725.5. It is not a violation of this section for an unregistered contractor to submit a bid
that is authorized by Section 7029.1 of the Business and Professions Code or Section 10164 or 20103.5 of
the Public Contract Code, provided the contactor is registered to perform public work pursuant to Section
1725.5 at the time the contract is awarded.”
32.3 DIR Registration Required.
City will not accept a bid proposal from or enter into this Construction Contract with Contractor without
proof that Contractor and its listed subcontractors are registered with the California Department of Industrial
Relations (“DIR”) to perform public work, subject to limited exceptions.
32.4 Posting of Job Site Notices.
City gives notice to Contractor and its listed subcontractors that Contractor is required to post all job site
notices prescribed by law or regulation and Contractor is subject to SB 854-compliance monitoring and
enforcement by DIR.
32.5 Payroll Records.
City requires Contractor and its listed subcontractors to comply with the requirements of Labor Code section
1776, including:
(i) Keep accurate payroll records, showing the name, address, social security
number, work classification, straight time and overtime hours worked each day
and week, and the actual per diem wages paid to each journeyman, apprentice,
worker, or other employee employed by, respectively, Contractor and its listed
subcontractors, in connection with the Project.
(ii) The payroll records shall be verified as true and correct and shall be certified
and made available for inspection at all reasonable hours at the principal office
of Contractor and its listed subcontractors, respectively.
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CONSTRUCTION CONTRACT
(iii) At the request of City, acting by its project manager, Contractor and its listed
subcontractors shall make the certified payroll records available for inspection
or furnished upon request to the project manager within ten (10) days of receipt
of City’s request.
City requests Contractor and its listed subcontractors to submit the certified
payroll records to the project manager at the end of each week during the
Project.
(iv) If the certified payroll records are not produced to the project manager within
the 10-day period, then Contractor and its listed subcontractors shall be subject
to a penalty of one hundred dollars ($100.00) per calendar day, or portion
thereof, for each worker, and City shall withhold the sum total of penalties from
the progress payment(s) then due and payable to Contractor. This provision
supplements the provisions of Section 15 hereof.
(v) Inform the project manager of the location of contractor’s and its listed
subcontractors’ payroll records (street address, city and county) at the
commencement of the Project, and also provide notice to the project manager
within five (5) business days of any change of location of those payroll records.
IN WITNESS WHEREOF, the parties have caused this Construction Contract to be executed the
date and year first above written.
CITY OF PALO ALTO
____________________________
City Manager or Designee
APPROVED AS TO FORM:
____________________________
City Attorney or designee
APPROVED:
____________________________
Public Works Director or Designee
MONTEREY MECHANICAL
Officer 1
By:___________________________
Name:________________________
Title:__________________________
Date: _________________________
Officer 2
By:____________________________
Name:_________________________
Title:___________________________
Date:____________________________
EXHIBIT “A-1” CONSTRUCTION SERVICES TASK ORDER
Contractor hereby agrees to perform the work detailed below in accordance with all the terms and conditions of the Agreement referenced in Item 1A below. All exhibits referenced in Item 8 are incorporated into the Agreement by this reference. The Contractor shall furnish the necessary facilities, professional, technical and supporting personnel required by this Task Order as described below.
CONTRACT NO. ISSUE DATE Purchase Requisition No. 1A. MASTER AGREEMENT NUMBER
1B. TASK ORDER NO. 2. CONTRACTOR
3. PERIOD OF PERFORMANCE: START: COMPLETION: 4 TOTAL TASK ORDER PRICE: $__________________ BALANCEREMAINING IN MASTER AGREEMENT $__________________________________ 5. BUDGET CODE: _______________
COST CENTER_________________ COST ELEMENT______________ WBS/CIP___PHASE___ 6. CITYPROJECTMANAGER’SNAME/DEPARTMENT_____________________________________ 7. DESCRIPTION OF SCOPE OF SERVICES MUST INCLUDE:
WORK TO BE PERFORMED
SCHEDULE OF WORK
BASIS FOR PAYMENT & FEE SCHEDULE
DELIVERABLES
REIMBURSABLES (with “not to exceed” cost) 8. ATTACHMENTS: A: Scope of Services B: __________________________________ --------------------------------------------------------------------------------------------------------------------------------- I hereby authorize the performance of I hereby acknowledge receipt and acceptance the work described above in this Task Order. of this Task Order and warrant that I have authority to sign on behalf of Contractor. APPROVED: APPROVED: CITY OF PALO ALTO COMPANY NAME: ______________________
BY:__________________________________ BY:____________________________________ Name ________________________________ Name __________________________________
Title_________________________________ Title___________________________________ Date _________________________________ Date ___________________________________
City of Palo Alto (ID # 10588)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 9/16/2019
City of Palo Alto Page 1
Summary Title: 2016 Measure B Local Streets and Roads Funding Agreement
Title: Approval of a Funding Agreement With the Santa Clara Valley
Transportation Authority (VTA) for 2016 Measure B Local Streets and Roads
Program Funding
From: City Manager
Lead Department: Transportation
Recommendation
Staff recommends that Council approve and authorize the City Manager to execute a
Funding Agreement with the Santa Clara Valley Transportation Authority for the 2016
Measure B Local Streets and Roads (LSR) Program.
Background
On November 8, 2016, Santa Clara County voters passed 2016 Measure B (“Measure
B”), a 30-year, half-cent sales tax measure funding transportation projects in the
following nine program areas: Local Streets and Roads, BART Phase II, Bicycle and
Pedestrian, Caltrain Grade Separation, Caltrain Corridor Capacity Improvements,
Highway Interchanges, County Expressways, State Route 85 Corridor, and Transit
Operations. Collection of the tax revenue began on April 1, 2017. A lawsuit challenging
the validity of Measure B was filed in 2017 and was resolved at the end of 2018.
Completion of the legal process allows the half-cent sales tax measure to be
implemented. The attached funding agreement with VTA (Attachment A) is the first of
several required for the City to obtain Measure B funds.
It is important to note that each program area of Measure B is very different, and the
funding allocation requirements vary by program.
Discussion
At their October 2017 meeting, the Santa Clara Valley Transportation Authority (VTA)
Board of Directors adopted guidelines intended to direct the implementation for each
Measure B program category. The program category guidelines for Local Streets and
Roads (LSR) can be found in Attachment B. As stated in the guidelines, all Santa
Clara County member agencies are required to demonstrate that funds are used to
City of Palo Alto Page 2
enhance and not replace their current investments for road system maintenance and
repair. The program also requires the member agencies to apply Complete Streets best
practices in order to improve bicycle and pedestrian elements of the street system.
Funds may be used for planning, maintenance, reconstruction, minor enhancements,
and preservation of multimodal roadway infrastructure.
If a member agency has a Pavement Condition Index (PCI) score of 70 or higher, it
may use LSR funds for congestion relief projects. As the Palo Alto street network PCI is
85 as of December 2018, Measure B funds can be used for a variety of congestion relief
projects and programs, such as planning for railroad grade separation, intersection
improvements, traffic signal system upgrades, transit improvements, bicycle facility
projects, bikeshare projects, and shuttle capital and operations. Initially, the City
expects to use these funds for the Connecting Palo Alto grade separation planning
process. It is important to note that this LSR funding is separate funding from the
Measure B Caltrain Grade Separation funding which is intended to provide funding to do
the grade separations. That Measure B program is a total of $700 Million to be split
between the Cities of Palo Alto, Mountain View, and Sunnyvale according to an
allocation plan that is currently being developed by VTA.
The LSR Program funding varies by agency depending on population in what is known
as a “return to source” fund. For the City of Palo Alto, the annual LSR distribution is
$1,273,986 for each of the first two full fiscal years, FY18 and FY19. For FY20 and
FY21, Palo Alto will be allotted $1,277,615.49 for each year. The program also includes
a one-time advancement equivalent to each agency’s sales tax revenue collection
between April 2017 and June 2017; for the City of Palo Alto, this one-time advance
payment is $303,672. Except for the one-time advance payment, all funding through
the LSR program is paid in the form of reimbursements for eligible projects. Approval
and execution of the funding agreement with VTA is required for the City to access any
of the LSR funds.
Timeline
The half-cent sales tax for transportation will be collected until March 31, 2047, when
Measure B expires. The City of Palo Alto can request reimbursement of funds for eligible
LSR projects until the funds allocated to the City have been fully expended.
Resource Impact
Upon execution of the funding agreement, the City will receive a one-time advance of
$303,672 for April 1, 2017 through June 30, 2017 and will accrue formulaic funds
through March 31, 2047 that will be available on a reimbursement basis. The annual
amount is determined by a formula based on the population of the jurisdiction and the
amount of sales tax received. It is anticipated that the City will continue to receive
approximately $1.2 million per year similar to FY20 and FY21, but specific allocations for
further years are unknown at this time.
City of Palo Alto Page 3
In FY20 the Adopted Capital Budget includes funding of $1.0 million for Rail Grade
Separation (PL-17001) and $400,000 for Traffic Signal and Intelligent Transportation
System Upgrades (PL-05030). Staff will monitor reimbursement levels of this program
and bring forward any necessary budget adjustments for City Council approval as part
of future budget cycles.
Policy Implications
Participation in the Measure B funding agreement is supported by the following
Comprehensive Plan policies and programs.
Policy T-1.25: Pursue transportation funding opportunities for ongoing transportation
improvements that will help mitigate the impacts of future development and protect
residents’ quality of life. When other sources are unavailable, continue to fund
improvements, operations and maintenance through the general fund.
Policy T-1.26: Collaborate with adjacent communities to ensure that Palo Alto and its
immediate neighbors receive their fair share of regional transportation funds,
proportional to the need and demand for transportation improvements within these
communities to address region-wide transportation issues.
Program T1.26.1: In collaboration with regional agencies and neighboring jurisdictions,
identify and pursue funding for rail corridor improvements and grade separation.
Policy T-3.15 Pursue grade separation of rail crossings along the rail corridor as a City
priority.
Program T3.15.1 Undertake studies and outreach necessary to advance grade
separation of Caltrain to become a “shovel ready” project and strongly advocate for
adequate State, regional and federal funding for design and construction of railroad
grade separations.
Environmental Review
Approval and execution of the funding agreement are actions that do not meet the
definition of a project for the purposes of CEQA, under Public Resources Code Section
21065 and CEQA Guidelines Section 15378(b)(5), because they are administrative
governmental activities which will not cause a direct or indirect physical change in the
environment. Each project funded via Measure B LSR funds will undergo environmental
review.
Attachments:
• Attachment A 2016MB_LSR_MasterAgmt_FINALDRAFT_020819
• Attachment B LSR Program guidelines VTA
Rev 02/2019 Page 1 of 9
FUNDING AGREEMENT
BETWEEN
THE CITY OF PALO ALTO
AND
THE SANTA CLARA VALLEY TRANSPORTATION AUTHORITY
FOR
2016 MEASURE B LOCAL STREETS AND ROADS PROGRAM
THIS AGREEMENT (“Agreement”) is between the CITY OF PALO ALTO, a “Member Agency,” referred to
herein as “RECIPIENT,” and the SANTA CLARA VALLEY TRANSPORTATION AUTHORITY, referred to herein
as “VTA.” Hereinafter, RECIPIENT and VTA may be individually referred to as “Party” or collectively
referred to as “Parties.”
I. RECITALS
1. Whereas, on June 24, 2016, the VTA Board of Directors adopted a resolution to place a ballot measure
before the voters of Santa Clara County in November 2016 to authorize a one-half of one percent
retail transaction and use tax (“2016 MEASURE B”) for 30 years for nine transportation-related
program categories; and
2. Whereas, on November 8, 2016, the voters of Santa Clara County enacted 2016 MEASURE B for 30
years to pay for the nine transportation-related program categories; and
3. Whereas, on October 5, 2017, the VTA Board of Directors established the 2016 Measure B Program
(“PROGRAM”) and adopted the 2016 Measure B Program Category Guidelines; and
4. Whereas, the PROGRAM includes a “Local Streets and Roads” program category consisting of a return-
to-source formula based on city populations and County of Santa Clara’s road and expressway lane
mileage; and
5. Whereas, the duration of 2016 MEASURE B will be 30 years from the initial year of collection,
beginning April 1, 2017, and continuing through March 31, 2047; and
6. Whereas, VTA and RECIPIENT desire to specify herein the terms and conditions under which the Local
Streets and Roads program category (“LS&R CATEGORY”) 2016 MEASURE B revenues will be
administered by VTA as directed by the VTA Board of Directors; and
7. Whereas, VTA has established a manual for purposes of documenting administrative requirements
related to LS&R CATEGORY funds disbursement and expenditure (“VTA LS&R Program Manual”).
NOW, THEREFORE, in consideration of the mutual promises contained in this Agreement, the Parties agree
as follows:
Rev 02/2019 Page 2 of 9
II. AGREEMENT
1. LS&R CATEGORY PROGRAM DEFINITION
The LS&R CATEGORY covers the entirety of public right-of-way and infrastructure, including, but not
limited to, pavement, sidewalk, signals, signage, drainage, and pedestrian and public transit
amenities.
2. TERM OF AGREEMENT
The term of this Agreement will commence on the Effective Date (as defined in the signature block
below) and continue through March 31, 2047, or until LS&R CATEGORY funds allocated to RECIPIENT
have been expended entirely, whichever occurs later.
3. ELIGIBLE USE OF FUNDS
RECIPIENT is permitted to use RECIPIENT’s allocated LS&R CATEGORY funds for any phase (including
but not limited to planning, construction, etc.) and any cost of the maintenance, rehabilitation,
reconstruction, minor improvements of, minor enhancements of, and preservation of multi-modal
roadway infrastructure. This includes implementation of “Complete Streets” elements. See
Attachment A for a definition of Complete Streets.
If RECIPIENT has achieved a jurisdictional average Pavement Condition Index (“PCI”) of 70, RECIPIENT
may use funds for other congestion relief projects as permitted by 2016 MEASURE B.
Only LS&R CATEGORY costs incurred on or after July 1, 2017, will be eligible for reimbursement.
4. DESIGN STANDARDS
RECIPIENT’S project(s) proposed hereunder must incorporate Complete Streets design, including, but
not limited to, best practice design standards and guidelines, such as those published by VTA (e.g.
Bicycle Technical Guidelines, Pedestrian Technical Guidelines, and Community, Design, and
Transportation Manual), Institute of Transportation Engineers (e.g. Designing Walkable Urban
Thoroughfares), American Association of State Highway and Transportation Officials (e.g. Guide for
the Development of Bicycle Facilities), National Association of City Transportation Officials (e.g. Urban
Street Design Guide, Urban Bikeway Design Guide, Transit Street Design Guide), and Caltrans (e.g.
Class IV Bikeway Guidance (Separated Bikeways/Cycle Tracks)).
5. FUNDING ALLOCATIONS
a. RECIPIENT’S funding allocation for each fiscal year, starting July 1, 2017, will be based upon
RECIPIENT’s percentage share of the population or road mileage, as applicable, applied to the
VTA Board of Directors Adopted Biennial Budget for the LS&R CATEGORY.
b. The LS&R CATEGORY annual fund distribution formula is calculated every two fiscal years (in
line with VTA’s budget cycle; a fiscal year begins July 1 and ends June 30) and is based on the
following:
Rev 02/2019 Page 3 of 9
i. First, at the same time that VTA plans and finalizes its budget for the two upcoming
fiscal years, the VTA Board of Directors determines the allocation of 2016 MEASURE B
funds for the two upcoming fiscal years.
ii. Second, the VTA Board of Directors determines the amount of 2016 MEASURE B funds
to be allocated amongst the PROGRAM categories, including the LS&R CATEGORY.
iii. Third, the County of Santa Clara’s percentage share of the total budgeted LS&R
CATEGORY funds (“SC Percentage Share”) is calculated by determining the percentage
of the total road and expressway lane mileage recorded in Santa Clara County,
California that the County of Santa Clara itself is responsible for maintaining (according
to the then most current California Public Road Data report issued by Caltrans).
iv. Fourth, the SC Percentage Share is multiplied by the total budgeted LS&R CATEGORY
funds to determine the dollar amount allocated to County of Santa Clara.
v. Fifth, the budgeted LS&R CATEGORY funds remaining after the allocation of the County
of Santa Clara’s share described above (“Remaining Funds”) are distributed to eligible
cities. Each city’s percentage share of the Remaining Funds (each, a “City Percentage
Share”) is calculated by determining the percentage of the total Santa Clara County,
California population (excluding unincorporated areas) attributed to each city
(according to the then most current California Department of Finance’s annual
population estimates (Report E-1, or any successor report)).
vi. Sixth, each City Percentage Share is multiplied by the Remaining Funds to determine
the dollar amount allocated to each city.
c. RECIPIENT’s allocations are subject to change based on variations in annual population or
road mileage and actual 2016 MEASURE B receipts for prior fiscal years.
d. RECIPIENT will receive a one-time advance equivalent to the RECIPIENT’s percentage
allocation of the LS&R CATEGORY’s percentage share of 2016 MEASURE B revenue collections
made from April 2017 through June 2017, upon (i) execution of this Agreement, (ii)
RECIPIENT’s submittal of an invoice for the one-time advance, and (iii) RECIPIENT’s first
submittal of 1) proposed projects in RECIPIENT’s “Annual Program of Projects”, 2)
maintenance of effort certification (see Section 7.d.), and 3) Complete Streets checklist
provided by VTA. Any interest earned or accrued from the one-time advance by RECIPIENT
must be expended only on eligible costs as set forth above under ELIGIBLE USE OF FUNDS and
DESIGN STANDARDS. RECIPIENT’s Annual Program of Projects must contain, at a minimum,
the following information:
i. Brief description of project/s
ii. Location of project/s
e. After the one-time advance, all remaining and future funds, if any, will be available only on a
reimbursement basis.
Rev 02/2019 Page 4 of 9
f. The one-time advance is in addition to RECIPIENT’s FY18 and FY19 LS&R CATEGORY
allocations.
6. VTA’s OBLIGATIONS
VTA will:
a. Annually update the LS&R CATEGORY formula to reflect the most current populations and
road mileage using the California Department of Finance’s annual population estimates
(Report E-1, or any successor report) and the most current California Public Road Data report
issued by Caltrans. VTA shall use the updated LS&R CATEGORY allocation formula in the
allocations beginning July 1 immediately following each VTA budget cycle.
b. Annually update the LS&R CATEGORY PCI for RECIPIENT based on the Metropolitan
Transportation Commission release of the prior year’s PCI.
c. Annually report to the public the amount of LS&R CATEGORY revenues allocated and
distributed to RECIPIENT.
d. VTA shall remit the amount due to the RECIPIENT within thirty (30) calendar days of receipt
of a complete and proper, fully documented invoice.
7. RECIPIENT’s OBLIGATIONS
RECIPIENT will:
a. Ensure that all 2016 MEASURE B funds are expended on allowable LS&R CATEGORY
expenditures as described above in ELIGIBLE USE OF FUNDS and DESIGN STANDARDS.
b. Annually complete and submit to VTA, by October 1st of each year, RECIPIENT’s Annual
Program of Projects, in which RECIPIENT will set forth proposed projects, and develop all such
projects which are approved as eligible (each a “PROJECT”).
c. Annually submit to VTA, by October 1st of each year, a summary of the prior fiscal year’s
completed PROJECT(S) and current fiscal year’s program of PROJECTS.
d. Annually submit to VTA, by October 1st of each year, a certification (which certification form
will be provided by VTA to RECIPIENT) that RECIPIENT is sustaining a maintenance of effort
(“MOE”), meaning that RECIPIENT will maintain a level of expenditures on LS&R CATEGORY
eligible activities equivalent to RECIPIENT’s expenditures submitted to the California
Transportation Commission per 2017 California Senate Bill 1 (“SB1”) MOE requirements for
the Road Repair and Accountability Act Local Streets and Roads Program. RECIPIENT must
submit to VTA an initial MOE base amount and certification of MOE for FY18 upon the
execution of this Agreement.
Rev 02/2019 Page 5 of 9
e. Comply with the VTA Board of Directors-approved Complete Streets requirements. RECIPIENT
must submit to VTA a Complete Streets Resolution adopted by the RECIPIENT’s governing
body upon the execution of this Agreement.
f. Annually complete and submit to VTA, by October 1st of each year, the VTA Complete Streets
checklist and any accompanying reporting requirements for the LS&R CATEGORY Annual
Program of Projects.
g. Submit to VTA all records including contractors’ invoices, miscellaneous invoices, and force
account charges as substantiation for expenditure of the one-time advance funds (which
funds, including any and all interest earned or accrued therefrom, must be exhausted in their
entirety prior to requesting funds for reimbursement).
h. Submit to VTA all records including contractors’ invoices, miscellaneous invoices, and force account charges as substantiation for invoices submitted to VTA for reimbursement
hereunder.
i. Maintain financial records, books, documents, papers, accounting records, and other
evidence pertaining to costs related to this Agreement for five (5) years from the date on
which the relevant cost(s) was/were incurred. RECIPIENT shall make such records available to
VTA upon written request for review and audit purposes. Financial audits will be performed
at VTA’s discretion.
j. Submit invoices to VTA, no more frequently than monthly, for reimbursement of work
completed on PROJECTS. Invoices must be submitted within one year of the date posted on
the contractor’s invoice submitted as substantiation for RECIPIENT’s invoice, if applicable.
8. GENERAL TERMS AND CONDITIONS
a. Indemnity. Neither VTA nor any officer or employee thereof will be responsible for any
damage or liability arising out of or relating to RECIPIENT’s negligence, recklessness, or willful
misconduct under or in connection with any work, authority, or jurisdiction associated with
this Agreement. RECIPIENT shall fully defend, indemnify, and save harmless VTA from all suits
or actions of every name, kind, and description brought on for or on account of injury (as
defined by California Government Code §810.8) arising out of or relating to RECIPIENT’s
negligence, recklessness, or willful misconduct under or in connection with any work,
authority, or jurisdiction delegated to RECIPIENT under this Agreement. This provision will
survive the termination or expiration of this Agreement.
b. Amendment. No alteration or variation of the terms of this Agreement will be valid unless
made in writing and signed by both of the Parties hereto, and no oral understanding or
agreement not incorporated herein will be binding on any of the Parties hereto.
c. Incorporation of Documents; Entire Agreement.
i. In addition to the terms set forth herein, this Agreement is subject to the
provisions of (i) the 2016 Measure B Program Category Guidelines and (ii) the VTA
Rev 02/2019 Page 6 of 9
LS&R Program Manual, both of which are incorporated herein by this reference.
VTA may, in its sole discretion, make changes to the 2016 Measure B Program
Category Guidelines and/or LS&R Program Manual at any time. If VTA makes such
changes, VTA will make reasonable efforts to provide RECIPIENT with advance
notice of such changes. Copies of the 2016 Measure B Program Category
Guidelines and the VTA LS&R Program Manual are available at the VTA website
(www.vta.org) or upon request to VTA.
ii. This Agreement, along with the 2016 Measure B Program Category Guidelines and
VTA LS&R Program Manual, contains the entire understanding between VTA and
RECIPIENT relating to the subject matter hereof. This Agreement supersedes any
and all other agreements which may have existed between the Parties, whether
oral or written. This Agreement, along with the 2016 Measure B Program Category
Guidelines and VTA LS&R Program Manual, is binding upon each Party, their legal
representatives, and successors for the duration of the Agreement.
d. Notices. Any notice which may be required under this Agreement must be in writing, will be
effective when received, and must be given by personal service or certified mail to the
individuals at the addresses set forth below, or to such other address which may be specified
in writing by the Parties hereto.
VTA:
Marcella Rensi
Deputy Director, Programming and Grants
Santa Clara Valley Transportation Authority
3331 N First Street
San Jose, CA 95134
Email: marcella.rensi@vta.org
RECIPIENT:
[INSERT TITLE]
CITY
Address
City, CA, Zip Code
Email
Written notification to the other Party must be provided, in advance, for changes in the name
or address of the individuals identified above.
The individual identified above for RECIPIENT is RECIPIENT’s LS&R CATEGORY Liaison
(“LIAISON”). The LIAISON shall be (i) the liaison to VTA pertaining to implementation of this
Agreement and (ii) the contact for information about the LS&R CATEGORY and PROJECTS.
e. Representation of Authority. Each Party to this Agreement represents and warrants that
each person whose signature appears hereon has been duly authorized and has the full
authority to execute this Agreement on behalf of the entity that is a party to this Agreement.
Rev 02/2019 Page 7 of 9
f. No Waiver. The failure of either Party to insist upon the strict performance of any of the
terms, covenant and conditions of this Agreement will not be deemed a waiver of any right
or remedy that either Party may have, and will not be deemed a waiver of either Party’s right
to require strict performance of all of the terms, covenants, and conditions hereunder.
g. Dispute Resolution. If a question or allegation arises regarding (i) interpretation of this
Agreement or its performance, or (ii) the alleged failure of a Party to perform, the Party raising
the question or making the allegation shall give written notice thereof to the other Party. The
Parties shall promptly meet in an effort to resolve the issues raised. If the Parties fail to resolve
the issues raised, alternative forms of dispute resolution, including mediation, may be
pursued by mutual agreement. It is the intent of the Parties to the greatest extent possible to
avoid litigation as a method of dispute resolution.
h. Severability. If any of the provisions of this Agreement (or portions or applications thereof)
are held to be unenforceable or invalid by any court of competent jurisdiction, VTA and
RECIPIENT shall negotiate an equitable adjustment in the provisions this Agreement with a
view toward effecting the purpose of this Agreement, and the validity and enforceability of
the remaining provisions or portions or applications thereof will not be affected thereby.
i. Governing Law. The laws of the State of California will govern this Agreement, as well as any
claim that might arise between RECIPIENT and VTA, without regard to conflict of law
provisions.
j. Venue. Any lawsuit or legal action arising from this Agreement must be commenced and
prosecuted in the courts of Santa Clara County, California. RECIPIENT agrees to submit to the
personal jurisdiction of the courts located in Santa Clara County, California for the purpose of
litigating all such claims.
Signatures of parties on following page.
Rev 02/2019 Page 8 of 9
IN WITNESS WHEREOF, VTA and RECIPIENT have executed this Agreement as of the last date set forth
below (“Effective Date”).
Santa Clara Valley City of Palo Alto
Transportation Authority
Nuria I. Fernandez Ed Shikada
General Manager/CEO City Manager
Date Date
Approved as to Form Approved as to Form
Megan Gristch
Staff Attorney II
Sandra Lee
City Attorney
Rev 02/2019 Page 9 of 9
ATTACHMENT A
Definition of Complete Streets
Complete Streets are generally defined as streets:
• That are planned, designed, funded, constructed, operated and maintained for the safe travel of
all users.
• Where designs are context sensitive and incorporate a balanced network approach.
• Which prioritize the safety, comfort, and convenience of pedestrians, bicyclists, transit riders
(including access and operations), as appropriate for the local context, while still providing safe
accommodations for motorists and other roadway users.
• Where capital projects, once completed, should not degrade the safety, comfort, or convenience
of pedestrians, bicyclists, or access to transit, nor should they degrade the travel time of transit
operations (recognizing that there may be situations where one of these modes may need to be
prioritized over another).
• Where designs are developed with input from the community and support future conditions.
This definition was set forth in VTA Board Memo No. 6096, dated May 25, 2017, and presented at the VTA
Board meeting held June 1, 2017 (“Measure B Complete Streets Reporting Requirements”).
Page 1 of 2
Local Streets & Roads Program Guidelines
Definition from Resolution No. 2016.06.17
To be returned to the cities and the County on a formula basis to be used to repair and
maintain the street system. The allocation would be based on the population of the cities and
the County of Santa Clara’s road and expressway lane mileage. Cities and the County will be
required to demonstrate that these funds would be used to enhance and not replace their
current investments for road system maintenance and repair. The program would also require
that cities and the County apply Compete Streets best practices in order to improve bicycle and
pedestrian elements of the street system. If a city or the County has a Pavement Condition
Index score of at least 70, it may use the funds for other congestion relief projects
Total Funding
$1.2 billion in 2017 dollars.
Distribution
Formula‐based distribution to Cities and County (agencies) as contained in 2016
Measure B.
Agencies will be informed of allocation amount for a two‐year period.
VTA anticipates that allocations will be programmed based upon the total allocation for
Local Streets & Roads contained in 2016 Measure B divided by the number of years in
the measure.
Future allocations will vary depending on the amount of sales tax revenue collected.
After a one‐time advance, no sooner than October 1, 2017, funds will be available on a
reimbursement basis.
Implementation
VTA and individual agencies will enter into funding agreements.
Agencies are required to submit an annual program of projects. For agencies with a
Pavement Condition Index (PCI) of 70 or higher, the program of projects may also
include congestion relief projects and programs. For agencies with a PCI of 69 or lower,
the program of projects is limited to projects that repair and maintain the street
system.
VTA will review the program of projects to ensure that all projects are eligible for
funding.
If an agency with a PCI of 70 or higher should have their PCI fall below 70, the agency
must redirect all funding to repair and maintenance of the street system in the
following cycle.
A one‐time advance, no sooner than October 1, 2017, equivalent to the percentage of
the local agency’s allocation of the Local Streets and Roads Program Area’s percentage
share of Program Tax Revenues collections from April 2017 to June 2017 will be
distributed to individual agencies upon:
Page 2 of 2
o Execution of the Master Funding Agreement between VTA and the Agency
o Submittal of annual program of projects
o Maintenance of Effort certification
o Complete Streets Checklist reporting requirements
Remaining funds will be available on a reimbursable basis.
Agencies may submit invoices to VTA on a monthly, quarterly or annual basis. Invoices
must be submitted within one year of the date posted on the contractor’s invoice.
Requirements
Individual agencies must certify and submit on an annual basis, a Maintenance of Effort
report to maintain a level of expenditures on 2016 Measure B Local Streets & Roads
eligible activities equivalent to the average expenditures on roadway and related
maintenance activities from the agency’s general fund during FY10 to FY12. This
certification will be submitted with their Annual Program of Projects.
All projects must comply with VTA’s Complete Streets Reporting Requirements.
All collateral material will be required to display a 2016 Measure B logo.
Agencies will submit project updates to VTA on a regular basis. The information will be
placed on the 2016 Measure B website to keep the public informed on 2016 Measure B
spending.
Agencies may also be requested to present updates to the 2016 Measure B Citizen’s
Oversight Committee.
City of Palo Alto (ID # 10611)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 9/16/2019
City of Palo Alto Page 1
Summary Title: NVCAP: WRA Environmental Contract
Title: Approval of Contract Number S19175846 With WRA, Inc. in an Amount
Not-to-Exceed $93,237 to Conduct a Matadero Creek Study for the North
Ventura Coordinated Area Plan
From: City Manager
Lead Department: Planning and Development
Recommendation:
Staff recommends that Council approve and authorize the City Manager or his designee to
execute the attached Contract S19175846 with WRA, Inc. (Attachment A) in the amount not to
exceed $93,237 to conduct a Matadero Creek Study related to the preparation of the North
Ventura Coordinated Area Plan (NVCAP).
Background:
The City Council initiated the coordinated area plan process on November 6, 2017 for the North
Ventura area. On March 11, 2019, the City Council held a Town Hall meeting at the Ventura
Community Center and received an update on the NVCAP. At that meeting, the Council directed
staff to evaluate and propose policies on various subjects such as inclusionary and workforce
housing; prevention of residential displacement; limiting amount and size of future office
spaces, etc. The Council also expressed interest in exploring design options that integrate
Matadero Creek as an open space feature in the plan and enhance its connection to Boulware
Park. At the August 19, 2019 meeting, the City Council also directed staff to return for approval
of a new contract with Water Resources Associates Environmental Consultants (WRA) to study
design options for Matadero Creek as part of the NVCAP project. The City Council also directed
staff to make amendments to the contract with the City’s prime consultant, Perkins+Will, and
adjustments to the project timeline.
Discussion:
City of Palo Alto Page 2
Following the March 11th Town Hall, staff initiated an informal Request for Proposal process for
proposals that would evaluate options for Matadero Creek, including naturalization and
incorporating in the NVCAP process. Of the two proposals that were received, staff determined
that WRA best met the needs of the project. WRA has diverse experience in a variety of
environmental analysis, including experience both in California and Palo Alto. WRA specifically
has experience in both habitat restoration and monitoring througout California, which is a key
component of Council’s direction. This type of analysis requires specialized expertise in
hydrological processes, engineering and design, as well as an understanding of the regulatory
process involving multiple regional entities, which WRA will be able to provide. WRA has the
breadth to provide the knowledge from the beginning of a project through implementation.
The scope of work in the contract includes (1) site assessment to understand the existing creek
condition, (2) preparation of three conceptual creek improvement scenarios, ranging from
maximum appropriate naturalization of the channel to no interference with the existing
channel, and (3) preparation of hydraulic models to inform the design of the scenarios. The
scope outlines WRA’s responsibility for preparation and participation in meetings required to
complete the project, including coordination with regional agencies, along with all project
management and coordination tasks. WRA is also responsible for preparation of monthly
invoices and coordinate project status and budget. Details of the scope of work is provided in
Exhibit A of Attachment A.
To prepare this analysis, staff requests Council approval for a contract with WRA in the amount
of $93,237, which includes 10% for additional services, should they be needed. The costs in the
attached contract lists the dollar amount by task. Once the contract is authorized by the City
Council, the analysis work is expected to take approximately 12-14 weeks, which will then be
incorporated into the development of design options for the NVCAP project.
WRA is a professional consulting company located in California with approximately 80
professionals, specializing in hydrology, restoration, plant, wildlife, and wetland ecology,
regulatory compliance, mitigation banking, CEQA/NEPA, GIS, and landscape architecture. WRA
has completed more than 3,000 projects for public agencies, non-profit, and private
organizations. WRA has a wide range of project experience throughout California in a variety of
region-specific habitats. The firm has completed award-winning projects recognized by the
American Society of Civil Engineering, Association of Environmental Professionals, California
Water Environment Association, and American Society of Landscape Architects.
Resource Impact:
City of Palo Alto Page 3
The recommendation in this report seeks Council approval for a contract with WRA in the
amount of $93,237 to conduct a feasibility and costing analysis to integrate Matadero Creek
into an open space area within the NVCAP project boundary. Sufficient funding is available in
the department’s Fiscal Year 2020 Adopted Operating budget to cover the cost of this work.
Environmental Review:
The action to approve the contract with WRA is exempt from the California Environmental
Quality Act (CEQA) in accordance with CEQA Guidelines section 15306 (Class 6) which exempts
information collection, research and resource evaluation from environmental review. The
resultant coordinated area plan will include the preparation of environmental analyses
consistent with the requirements of CEQA.
Attachments:
Attachment A: WRA NVCAP Creek Contract (PDF)
Professional Services Rev. April 27, 2018 1
CITY OF PALO ALTO CONTRACT NO. S19175846
AGREEMENT BETWEEN THE CITY OF PALO ALTO AND WRA, INC.
FOR PROFESSIONAL SERVICES
This Agreement is entered into on this 9th day of September, 2019, (“Agreement”)
by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and WRA, INC. a California corporation, located at 2169 E. Francisco Blvd. Ste. G, San Rafael, California, 94901 ("CONSULTANT").
RECITALS
The following recitals are a substantive portion of this Agreement.
A. CITY intends to perform a creek analysis for the North Ventura Coordinated Area Plan
(NVCAP) (“Project”) and desires to engage a consultant to provide services in connection with
the Project (“Services”).
B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the
Services.
C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit “A”, attached to and made a part of this Agreement.
NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree:
AGREEMENT
SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit “A” in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY.
SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution
through June 30, 2021 unless terminated earlier pursuant to Section 19 of this Agreement.
SECTION 3. SCHEDULE OF PERFORMANCE. Time is of the essence in the performance of Services under this Agreement. CONSULTANT shall complete the Services within the term
of this Agreement and in accordance with the schedule set forth in Exhibit “B”, attached to and
made a part of this Agreement. Any Services for which times for performance are not specified in this Agreement shall be commenced and completed by CONSULTANT in a reasonably prompt and timely manner based upon the circumstances and direction communicated to the CONSULTANT. CITY’s agreement to extend the term or the schedule for performance shall
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not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT.
SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, shall not exceed Ninety-three Thousand Two Hundred Thirty-two Dollars and Seventy Cents. ($93,232.70). CONSULTANT agrees to complete all Basic
Services, including reimbursable expenses, within this amount. The applicable rates and
schedule of payment are set out at Exhibit “C-1”, entitled “SCHEDULE OF RATES,” which is attached to and made a part of this Agreement. Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the CITY.
Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C” (“COMPENSATION”). CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of CITY. Additional Services shall mean any work that is determined by CITY to be necessary for the proper
completion of the Project, but which is not included within the Scope of Services described at
Exhibit “A”. SECTION 5. INVOICES. In order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an
identification of personnel who performed the services, hours worked, hourly rates, and
reimbursable expenses), based upon the CONSULTANT’s billing rates (set forth in Exhibit “C-1”). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT’s payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City’s project manager at the address specified in
Section 13 below. The City will generally process and pay invoices within thirty (30) days of
receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be performed by CONSULTANT or under CONSULTANT’s supervision. CONSULTANT
represents that it possesses the professional and technical personnel necessary to perform the
Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally
required to perform the Services.
All of the services to be furnished by CONSULTANT under this Agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or
similar circumstances.
SECTION 7. COMPLIANCE WITH LAWS. CONSULTANT shall keep itself informed of and in compliance with all federal, state and local laws, ordinances, regulations, and orders that may affect in any manner the Project or the performance of the Services or those engaged to
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perform Services under this Agreement. CONSULTANT shall procure all permits and licenses, pay all charges and fees, and give all notices required by law in the performance of the Services.
SECTION 8. ERRORS/OMISSIONS. CONSULTANT is solely responsible for costs, including, but not limited to, increases in the cost of Services, arising from or caused by CONSULTANT’s errors and omissions, including, but not limited to, the costs of corrections such errors and omissions, any change order markup costs, or costs arising from delay caused by
the errors and omissions or unreasonable delay in correcting the errors and omissions.
SECTION 9. COST ESTIMATES. If this Agreement pertains to the design of a public works project, CONSULTANT shall submit estimates of probable construction costs at each phase of design submittal. If the total estimated construction cost at any submittal exceeds ten percent
(10%) of CITY’s stated construction budget, CONSULTANT shall make recommendations to
CITY for aligning the PROJECT design with the budget, incorporate CITY approved recommendations, and revise the design to meet the Project budget, at no additional cost to CITY.
SECTION 10. INDEPENDENT CONTRACTOR. It is understood and agreed that in
performing the Services under this Agreement CONSULTANT, and any person employed by or contracted with CONSULTANT to furnish labor and/or materials under this Agreement, shall act as and be an independent contractor and not an agent or employee of CITY.
SECTION 11. ASSIGNMENT. The parties agree that the expertise and experience of
CONSULTANT are material considerations for this Agreement. CONSULTANT shall not assign or transfer any interest in this Agreement nor the performance of any of CONSULTANT’s obligations hereunder without the prior written consent of the City Manager. Consent to one assignment will not be deemed to be consent to any subsequent assignment. Any
assignment made without the approval of the City Manager will be void.
SECTION 12. SUBCONTRACTING. CONSULTANT shall not subcontract any portion of the work to be performed under this Agreement without the prior written authorization of the City Manager or designee.
CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior
approval of the City Manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign George Salvaggio as the Principal Landscape Architect to have supervisory responsibility for the performance, progress, and execution of the Services and to represent CONSULTANT during
the day-to-day work on the Project. If circumstances cause the substitution of the project
director, project coordinator, or any other key personnel for any reason, the appointment of a substitute project director and the assignment of any key new or replacement personnel will be subject to the prior written approval of the CITY’s project manager. CONSULTANT, at CITY’s request, shall promptly remove personnel who CITY finds do not perform the Services in an
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acceptable manner, are uncooperative, or present a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property.
CITY’s project manager is Elena Lee, Planning & Development Services Department, 250 Hamilton Avenue, Palo Alto, CA 94303, Telephone: (650) 617-3196. The project manager will be CONSULTANT’s point of contact with respect to performance, progress and execution of the Services. CITY may designate an alternate project manager from time to time.
SECTION 14. OWNERSHIP OF MATERIALS. Upon delivery, all work product, including without limitation, all writings, drawings, plans, reports, specifications, calculations, documents, other materials and copyright interests developed under this Agreement shall be and remain the exclusive property of CITY without restriction or limitation upon their use. CONSULTANT
agrees that all copyrights which arise from creation of the work pursuant to this Agreement shall
be vested in CITY, and CONSULTANT waives and relinquishes all claims to copyright or other intellectual property rights in favor of the CITY. Neither CONSULTANT nor its contractors, if any, shall make any of such materials available to any individual or organization without the prior written approval of the City Manager or designee. CONSULTANT makes no
representation of the suitability of the work product for use in or application to circumstances not
contemplated by the scope of work. SECTION 15. AUDITS. CONSULTANT will permit CITY to audit, at any reasonable time during the term of this Agreement and for three (3) years thereafter, CONSULTANT’s records
pertaining to matters covered by this Agreement. CONSULTANT further agrees to maintain and
retain such records for at least three (3) years after the expiration or earlier termination of this Agreement. SECTION 16. INDEMNITY.
16.1. To the fullest extent permitted by law, CONSULTANT shall protect, indemnify, defend and hold harmless CITY, its Council members, officers, employees and agents (each an “Indemnified Party”) from and against any and all demands, claims, or liability of any nature, including death or injury to any person, property damage or any other loss,
including all costs and expenses of whatever nature including attorneys’ fees, experts fees, court
costs and disbursements (“Claims”) that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party.
16.2. Notwithstanding the above, nothing in this Section 16 shall be construed to require CONSULTANT to indemnify an Indemnified Party from Claims arising from the active negligence, sole negligence or willful misconduct of an Indemnified Party.
16.3. The acceptance of CONSULTANT’s services and duties by CITY shall
not operate as a waiver of the right of indemnification. The provisions of this Section 16 shall survive the expiration or early termination of this Agreement. SECTION 17. WAIVERS. The waiver by either party of any breach or violation of any
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covenant, term, condition or provision of this Agreement, or of the provisions of any ordinance or law, will not be deemed to be a waiver of any other term, covenant, condition, provisions,
ordinance or law, or of any subsequent breach or violation of the same or of any other term,
covenant, condition, provision, ordinance or law. SECTION 18. INSURANCE.
18.1. CONSULTANT, at its sole cost and expense, shall obtain and maintain, in
full force and effect during the term of this Agreement, the insurance coverage described in Exhibit "D". CONSULTANT and its contractors, if any, shall obtain a policy endorsement naming CITY as an additional insured under any general liability or automobile policy or policies.
18.2. All insurance coverage required hereunder shall be provided through carriers with AM Best’s Key Rating Guide ratings of A-:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in
full force and effect during the term of this Agreement, identical insurance coverage, naming
CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the
approval of CITY’s Risk Manager and will contain an endorsement stating that the insurance is
primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days’ notice to CONSULTANT, CONSULTANT shall provide the
Purchasing Manager written notice of the cancellation or modification within two (2) business
days of the CONSULTANT’s receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY’s Chief Procurement Officer during the entire term of this Agreement.
18.4. The procuring of such required policy or policies of insurance will not be
construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement,
including such damage, injury, or loss arising after the Agreement is terminated or the term has
expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES.
19.1. The City Manager may suspend the performance of the Services, in whole
or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services.
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19.2. CONSULTANT may terminate this Agreement or suspend its performance of the Services by giving thirty (30) days prior written notice thereof to CITY, but
only in the event of a substantial failure of performance by CITY.
19.3. Upon such suspension or termination, CONSULTANT shall deliver to the City Manager immediately any and all copies of studies, sketches, drawings, computations, and other data, whether or not completed, prepared by CONSULTANT or its contractors, if any, or
given to CONSULTANT or its contractors, if any, in connection with this Agreement. Such
materials will become the property of CITY. 19.4. Upon such suspension or termination by CITY, CONSULTANT will be paid for the Services rendered or materials delivered to CITY in accordance with the scope of
services on or before the effective date (i.e., 10 days after giving notice) of suspension or
termination; provided, however, if this Agreement is suspended or terminated on account of a default by CONSULTANT, CITY will be obligated to compensate CONSULTANT only for that portion of CONSULTANT’s services which are of direct and immediate benefit to CITY as such determination may be made by the City Manager acting in the reasonable exercise of his/her
discretion. The following Sections will survive any expiration or termination of this Agreement:
14, 15, 16, 19.4, 20, and 25. 19.5. No payment, partial payment, acceptance, or partial acceptance by CITY will operate as a waiver on the part of CITY of any of its rights under this Agreement.
SECTION 20. NOTICES. All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows:
To CITY: Office of the City Clerk City of Palo Alto Post Office Box 10250 Palo Alto, CA 94303
With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above
SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which
would conflict in any manner or degree with the performance of the Services.
21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this
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Agreement is an officer or employee of CITY; this provision will be interpreted in accordance with the applicable provisions of the Palo Alto Municipal Code and the Government Code of the
State of California.
21.3. If the Project Manager determines that CONSULTANT is a “Consultant” as that term is defined by the Regulations of the Fair Political Practices Commission, CONSULTANT shall be required and agrees to file the appropriate financial disclosure
documents required by the Palo Alto Municipal Code and the Political Reform Act.
SECTION 22. NONDISCRIMINATION. As set forth in Palo Alto Municipal Code section 2.30.510, CONSULTANT certifies that in the performance of this Agreement, it shall not discriminate in the employment of any person due to that person’s race, skin color, gender,
gender identity, age, religion, disability, national origin, ancestry, sexual orientation, pregnancy,
genetic information or condition, housing status, marital status, familial status, weight or height of such person. CONSULTANT acknowledges that it has read and understands the provisions of Section 2.30.510 of the Palo Alto Municipal Code relating to Nondiscrimination Requirements and the penalties for violation thereof, and agrees to meet all requirements of Section 2.30.510
pertaining to nondiscrimination in employment. SECTION 23. ENVIRONMENTALLY PREFERRED PURCHASING AND ZERO WASTE REQUIREMENTS. CONSULTANT shall comply with the CITY’s Environmentally Preferred Purchasing policies which are available at CITY’s Purchasing Department,
incorporated by reference and may be amended from time to time. CONSULTANT shall
comply with waste reduction, reuse, recycling and disposal requirements of CITY’s Zero Waste Program. Zero Waste best practices include first minimizing and reducing waste; second, reusing waste and third, recycling or composting waste. In particular, CONSULTANT shall comply with the following zero waste requirements:
(a) All printed materials provided by CCONSULTANT to CITY generated from a
personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double-sided and printed on a minimum of 30% or greater post-consumer content paper, unless otherwise approved by CITY’s Project Manager. Any submitted materials printed
by a professional printing company shall be a minimum of 30% or greater post-
consumer material and printed with vegetable based inks. (b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY’s Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and
packaging. A copy of this policy is on file at CITY’s Purchasing Division’s
office. (c) Reusable/returnable pallets shall be taken back by CONSULTANT, at no additional cost to CITY, for reuse or recycling. CONSULTANT shall provide documentation from the facility accepting the pallets to verify that pallets are not
being disposed. SECTION 24. COMPLIANCE WITH PALO ALTO MINIMUM WAGE ORDINANCE. CONSULTANT shall comply with all requirements of the Palo Alto Municipal Code Chapter 4.62 (Citywide Minimum Wage), as it may be amended from time to time. In particular, for any
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employee otherwise entitled to the State minimum wage, who performs at least two (2) hours of work in a calendar week within the geographic boundaries of the City, CONSULTANT shall pay
such employees no less than the minimum wage set forth in Palo Alto Municipal Code section
4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060.
SECTION 25. NON-APPROPRIATION
25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the
following fiscal year, or (b) at any time within a fiscal year in the event that funds are only
appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement.
SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS 26.1 This Project is not subject to prevailing wages. CONSULTANT is not required to pay prevailing wages in the performance and implementation of the Project in
accordance with California Labor Code Section 1782 if the contract is not a public works
contract, if the contract does not include a public works construction project of more than $25,000, or the contract does not include a public works alteration, demolition, repair, or maintenance (collectively, ‘improvement’) project of more than $15,000.
SECTION 27. MISCELLANEOUS PROVISIONS.
27.1. This Agreement will be governed by the laws of the State of California. 27.2. In the event that an action is brought, the parties agree that trial of such
action will be vested exclusively in the state courts of California in the County of Santa Clara,
State of California. 27.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that
action. The prevailing party shall be entitled to recover an amount equal to the fair market value
of legal services provided by attorneys employed by it as well as any attorneys’ fees paid to third parties. 27.4. This document represents the entire and integrated agreement between the
parties and supersedes all prior negotiations, representations, and contracts, either written or oral.
This document may be amended only by a written instrument, which is signed by the parties. 27.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and
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consultants of the parties.
27.6. If a court of competent jurisdiction finds or rules that any provision of this
Agreement or any amendment thereto is void or unenforceable, the unaffected provisions of this Agreement and any amendments thereto will remain in full force and effect. 27.7. All exhibits referred to in this Agreement and any addenda, appendices,
attachments, and schedules to this Agreement which, from time to time, may be referred to in
any duly executed amendment hereto are by such reference incorporated in this Agreement and will be deemed to be a part of this Agreement. 27.8 In the event of a conflict between the terms of this Agreement and the
exhibits hereto or CONSULTANT’s proposal (if any), the Agreement shall control. In the case
of any conflict between the exhibits hereto and CONSULTANT’s proposal, the exhibits shall control. 27.9 If, pursuant to this contract with CONSULTANT, CITY shares with
CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d)
about a California resident (“Personal Information”), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for
direct marketing purposes without City’s express written consent.
27.10 All unchecked boxes do not apply to this Agreement.
27.11 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27.12 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement.
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CONTRACT No. S19174846 SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have by their duly authorized
representatives executed this Agreement on the date first above written.
CITY OF PALO ALTO
Purchasing Manager
APPROVED AS TO FORM:
City Attorney or designee
WRA, INC. Officer 1
By:
Name:
Title:
Officer 2 (Required for Corp. or LLC)
By:
Name:
Title:
Attachments: EXHIBIT “A”: SCOPE OF SERVICES EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION
EXHIBIT “C-1”: SCHEDULE OF RATES
EXHIBIT “D”: INSURANCE REQUIREMENTS
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George Salvaggio
George J. Salvaggio JR.
Justin Semion
Principal
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EXHIBIT “A” SCOPE OF SERVICES
PURPOSE
This Scope of Work describes the tasks to be performed by CONSULTANT for
preparation of conceptual creek improvement designs for Matadero Creek within the North
Ventura Coordinated Area Plan (Plan) boundaries. CONSULTANT will prepare three conceptual improvement designs that range from full naturalization to no impact. The design concepts will consider all constraints and opportunities communicated to CONSULTANT by Perkins + Will, along with the Santa Clara Valley Water District (SCVWD) responses
to questions dated March 27, 2019.
WORK PRODUCTS
• Three (3) Conceptual Creek Improvement Plans
• Budgetary Cost Comparison
SCOPE OF WORK CONSULTANT will perform the services outlined below. Task 1: Site Assessment
CONSULTANT’s design lead will perform a site assessment to gain an understanding of the existing creek condition and gain perspective on the scale of the project. The assessment will include a desktop review of existing aerial photography, historical aerial
photography, soils mapping, vapor intrusion area information, and preliminary Area Plan documentation. CONSULTANT will also conduct one site visit to photograph the existing conditions and take rough measurements of the channel. This task also includes coordination with CITY and Perkins+Will/BKF team to integrate appropriate elements of the Plan into the improvement concepts.
Task 2: Prepare Conceptual Creek Improvement Scenarios
Under this task, CONSULTANT will prepare three conceptual design concepts showing improvement scenarios for the approximately 800 linear feet of Matadero Creek within the Plan area for Perkins + Will to include in the Plan. The concepts will range from maximum appropriate naturalization of the channel to no interference with the existing
channel. Comments from the SCVWD provided in March 2019 will be addressed.
CONSULTANT will review other elements of the plan, including open space, recreation, landscaping, public access and SCVWD maintenance needs, and integrate those elements into the design concept as appropriate. Each concept will include a plan view of the creek in the Plan area, along with a typical section showing the proposed improvements. The graphics will be provided to Perkins + Will in
AutoCAD or Adobe software format for inclusion into Plan documents. CONSULTANT
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will revise the concepts one time under this task based on input from Perkins + Will, SCVWD, CITY, other agencies and information gathered during public meetings. If more
than one round of revisions is required, CONSULTANT may request additional fees.
Task 3: Hydraulic Modeling
CONSULTANT will run a preliminary surface water hydrologic and hydraulic model to
inform the design of the scenarios described above. The models will be preliminary in
nature and will be used to show that each of the proposed designs will not raise the 100-year water surface elevation or result in aggradation, degradation or other instability of the proposed condition. Each of the proposed designs will be represented by a typical cross section, horizontal alignment, and vertical profile. A memo describing the parameters,
methodology, assumptions and limitations of the model will be provided to CITY and
Perkins + Will along with the final design concepts.
Task 4: Meetings
This task covers preparation and participation in meetings required to complete the project. Included are the following meetings. The number of meetings is included in parentheses:
• In-person project kick-off meeting with CITY and Perkins + Will (1)
• Working Group meeting (3)
• Decision maker meeting (1)
• City Council Meetings (2)
• Meeting with SCVWD (1)
• Interagency Review Meeting – Corps, RWQCB, CDFW, NMFS, USFWS (1)
• Meeting with Architectural Board or other agencies (3)
• Video conference coordination meetings with CITY, Perkins + Will or SCVWD (3) All meeting costs related to materials preparation, travel and debriefing are included in the fees for this task.
Task 5: Project Management
CONSULTANT will perform project management and coordination efforts associated with the scope of work outlined herein. Under this task, CONSULTANT will manage the work
described in the scope and coordinate with CITY, project team members, resource agencies and the SCVWD through the completion of the work. CONSULTANT will also prepare and submit monthly invoices and coordinate project status and budget.
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EXHIBIT “B” SCHEDULE OF PERFORMANCE
CONSULTANT shall perform the Services so as to complete each task within the number of days specified below. The time to complete each task may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed.
Task Start Date Duration End Date
Notice to Proceed/Kickoff Meeting 9/10/2019 7 9/17/2019
Desktop Assessment 9/11/2019 9 9/20/2019
Site Assessment 9/23/2019 4 9/27/2019
Meet with SCVWD 9/23/2019 4 9/27/2019
Provide Update for Working Group Meeting #1* 9/17/2019 1 9/18/2019
Draft Concepts 9/27/2019 21 10/18/2019
Hydraulic Modeling 9/27/2019 21 10/18/2019
Concept Submittal 10/18/2019 1 10/19/2019
Concept Review 10/21/2019 11 11/1/2019
Working Group Meeting #2 10/15/2019 1 10/16/2019
Address Comments 11/4/2019 32 12/6/2019
Interagency Review Meeting 11/14/2019 1 11/15/2019
Working Group Meeting/Decision Maker Meeting 12/10/2019 1 12/11/2019
Concept Resubmittal 12/16/2019 4 12/20/2019
Meetings (City Council, Video Conferences) 9/10/2019 101 12/20/2019
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Project Management 9/10/2019 101 12/20/2019
*Meeting dates are subject to adjustment.
Jun
-19
Jul
-19
Aug
-19
Se
p
-19
Oct
-19
Nov-19
…
…
…
Matadero Creek Improvement Concept Preliminary Schedule
Notice to Proceed/Kickoff Meeting
Desktop Assessment
Site Assessment
Meet with SCVWD
Provide Update for Working Group
Draft Concepts
Hydraulic Modeling
Concept Submittal
Concept Review
Working Group Meeting #2
Address Comments
Interagency Review Meeting
Working Group Meeting/Decision
Concept Resubmittal
Meetings (City Council, Video
Project Management
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EXHIBIT “C” COMPENSATION
The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the hourly rate schedule attached as Exhibit “C-1” up to the not-to-exceed budget amount for each task set forth below.
CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. The CITY’s Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for Basic Services, including reimbursable expenses, and the total compensation for Additional Services do not exceed the amounts set forth in Section 4 of this Agreement.
BUDGET SCHEDULE NOT-TO-EXCEED AMOUNT Task 1 $5,900.00 (Site Assessment)
Task 2 $27,798.00 (Prepare Conceptual Creek Improvement Scenarios) Task 3 $12,541.00
(Hydraulic Modeling)
Task 4 $30,166.00 (Meetings)
Task 5 $8,352.00
(Project Management) Sub-total Basic Services $84,757.00
DocuSign Envelope ID: A2FB4B91-686A-46E9-A2BF-FF090BFBFBC1
Professional Services Rev. April 27, 2018 2
Reimbursable Expenses $0.00 Total Basic Services and Reimbursable expenses $84,757.00
Additional Services $ 8,475.70
Maximum Total Compensation $93,232.70
REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing,
insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. Expenses for which CONSULTANT shall be reimbursed are: None. ADDITIONAL SERVICES
CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed written proposal including a description of the scope of services, schedule, level of effort, and CONSULTANT’s proposed maximum compensation, including reimbursable expense, for such services based on the rates set forth in Exhibit “C-1”. The additional services scope, schedule and maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project Manager and CONSULTANT prior to commencement of the services. Payment for
additional services is subject to all requirements and restrictions in this Agreement.
DocuSign Envelope ID: A2FB4B91-686A-46E9-A2BF-FF090BFBFBC1
Project Name:Matadero Creek Improvement Plan
Project Number:29113
Date:4/2/2019
Rate Schedule:Preferred
Personnel Hours by Task*
Task #Task Description
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WRA Cost by Task WRA Direct Expenses Sub-Contractor Total Cost Task Total
1 Desktop assessment/background 1,824$ -$ 1,824$
Site visit 3,890$ 186$ 4,076$
-$ -$ -$ 5,900$
2 Draft concepts 9,706$ -$ 9,706$
comment coordination 2,288$ -$ 2,288$
revise concepts 7,294$ -$ 7,294$
graphics 6,464$ -$ 6,464$
cost estimate 2,046$ -$ 2,046$ 27,798$
3 Hydrology/existing model assessment 1,263$ -$ 1,263$
hydraulic model setup 3,668$ -$ 3,668$
hydraulic model of 4 concepts 7,610$ -$ 7,610$ 12,541$
4 Kickoff meeting (1)1,996$ 45$ 2,041$
Meetings with working group (3)6,943$ 243$ 7,186$
Meeting with decision maker (1)3,060$ 83$ 3,143$
City Council Meetings (2)4,469$ 83$ 4,552$
Meeting with SCVWD (1)1,686$ 83$ 1,769$
Interagency Review Meeting (1)5,264$ 45$ 5,309$
Other Meetings (3)4,350$ 236$ 4,586$
Video conference coordination meetings (3)1,580$ -$ 1,580$
-$ 30,166$
5 Project Management 8,352$ -$ 8,352$
8,352$
TOTAL LABOR HOURS
TOTAL COST $83,753 $1,004 $0 $84,757
200.00$
2
10 10
12,768$ 1,558$
96 9.5
20,832$
51 124
20,111$
91
9,180$ 4,200$
6421
15,104$
2 2
168.00$ 133.00$ 164.00$ 236.00$ 221.00$ 180.00$
4 6 24 26
2 4 18 22
4 8
2 2 4 4
2 4 40
3 3
4 10 6
10 30
4 4 1
4 16 4 8 3
4 8 1 1
6 8 2 6 1
4 32
3.5
12
6
12
6
1
1
2
2
18
8
DocuSign Envelope ID: A2FB4B91-686A-46E9-A2BF-FF090BFBFBC1
Professional Services Rev. April 27, 2018 1
EXHIBIT “D” INSURANCE REQUIREMENTS
CONTRACTORS TO THE CITY OF PALO ALTO (CITY), AT THEIR SOLE EXPENSE, SHALL FOR THE TERM OF THE CONTRACT OBTAIN AND MAINTAIN INSURANCE IN THE AMOUNTS FOR THE COVERAGE SPECIFIED BELOW, AFFORDED BY COMPANIES WITH AM BEST’S KEY RATING OF A-:VII, OR HIGHER, LICENSED OR AUTHORIZED TO TRANSACT INSURANCE BUSINESS IN THE STATE OF CALIFORNIA. AWARD IS CONTINGENT ON COMPLIANCE WITH CITY’S INSURANCE REQUIREMENTS, AS SPECIFIED, BELOW:
REQUIRED TYPE OF COVERAGE REQUIREMENT
MINIMUM LIMITS
EACH
OCCURRENCE AGGREGATE
YES
YES
WORKER’S COMPENSATION EMPLOYER’S LIABILITY STATUTORY STATUTORY
YES
GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL LIABILITY
BODILY INJURY PROPERTY DAMAGE BODILY INJURY & PROPERTY DAMAGE COMBINED.
$1,000,000 $1,000,000 $1,000,000
$1,000,000 $1,000,000 $1,000,000
YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON-OWNED
BODILY INJURY - EACH PERSON - EACH OCCURRENCE PROPERTY DAMAGE BODILY INJURY AND PROPERTY DAMAGE, COMBINED
$1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000
$1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000
YES
PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE
ALL DAMAGES $1,000,000
YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS’ COMPENSATION, EMPLOYER’S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES.
I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR’S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY’S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE AT
THE FOLLOWING URL: https://www.planetbids.com/portal/portal.cfm?CompanyID=25569. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO “ADDITIONAL INSUREDS” A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS.
DocuSign Envelope ID: A2FB4B91-686A-46E9-A2BF-FF090BFBFBC1
Professional Services Rev. April 27, 2018 2
B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY.
C. NOTICE OF CANCELLATION
1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION.
VENDORS ARE REQUIRED TO FILE THEIR EVIDENCE OF INSURANCE AND ANY OTHER RELATED NOTICES WITH THE CITY OF PALO ALTO AT THE FOLLOWING URL:
HTTPS://WWW.PLANETBIDS.COM/PORTAL/PORTAL.CFM?COMPANYID=25569
OR
HTTP://WWW.CITYOFPALOALTO.ORG/GOV/DEPTS/ASD/PLANET_BIDS_HOW_TO.ASP
DocuSign Envelope ID: A2FB4B91-686A-46E9-A2BF-FF090BFBFBC1
CITY OF PALO ALTO OFFICE OF THE CITY CLERK
September 16, 2019
The Honorable City Council
Palo Alto, California
Vote to Endorse the Slate of Candidates for the Peninsula Division’s
Executive Committee for 2018-19 and Direct the City Clerk to Forward
to Seth Miller, the Regional Public Affairs Manager for the Peninsula
Division, League of California Cities the Completed Ballot for the City
of Palo Alto
RECOMMENDATION:
The City Council should formally vote to endorse the slate of candidates for the Peninsula
Division’s Executive Committee for 2019-20 and direct the City Clerk to forward to Seth Miller,
the Regional Public Affairs Manager for the Peninsula Division, League of California Cities the
completed ballot for the City of Palo Alto.
BACKGROUND:
The election for the Executive Committee for the Peninsula Division of the League of California
Cities will be held on Friday, October 18, 2019 at the Division’s annual election luncheon during
the League of California Cities Annual Conference in Long Beach, CA. The Peninsula Division
Nominating Committee’s Division President and City of East Palo Alto Council Member Larry
Moody, and Division Vice President and City of Los Gatos Council Member Marico Sayoc, submit
the following candidates for the Peninsula Division’s Executive Committee for the 2019-20 Ballot.
Each city is entitled to one vote for each office on the ballot and only one person has been
nominated for each position.
President:
Marico Sayoc, Council Member, City of Los Gatos
Vice President:
Shelly Masur, Council Member, Redwood City
Treasurer:
Nancy Smith, Council Member, City of Sunnyvale
Secretary:
Neysa Fligor, Council Member, Town of Los Altos
Board of Director (Two Year Term):
Emily Beach, Council Member, City of Burlingame
Page 2
Board Liaison:
Alicia Aguirre, Council Member, Redwood City
Legislative Action Committee, Santa Clara County:
Charles “Chappie” Jones, Council Member, City of San Jose
Legislative Action Committee, San Mateo County:
Julia Mates, Council Member, City of Belmont
Past President:
Larry Moody, Council Member, City of East Palo Alto
Santa Clara County Representative:
John McKay, Council Member City of Morgan Hill
San Mateo County Representative:
Mark Nogales, Council Member, City of South San Francisco
The ballots will be opened and tabulated at the annual election luncheon. The new officers will
be introduced at that time.
Attached please find the biographies submitted for these candidates.
ATTACHMENTS:
• Attachment A: League of California Cities (PDF)
Department Head: Beth Minor, City Clerk
Page 3
City of Palo Alto (ID # 10230)
City Council Staff Report
Report Type: Action Items Meeting Date: 9/16/2019
City of Palo Alto Page 1
Summary Title: Neighborhood Funding Option to Retain Underground
Electrical Equipment
Title: Staff and Utilities Advisory Commission Recommendation That the City
Council Adopt a Resolution Amending Rule and Regulation 20 to Allow
Neighborhood Self-funding of Certain Subsurface Equipment
From: City Manager
Lead Department: Utilities
Recommended Motion
Staff and the Utilities Advisory Commission (“UAC”) recommend that Council consider the
following motion:
Approve the attached Resolution (Attachment A) amending Utility Rule and Regulation 20 to
allow Neighborhoods to Self-Fund Certain Subsurface Projects.
Executive Summary
City of Palo Alto Utilities (“CPAU”) endeavors to build and maintain a safe, reliable, and cost-
effective electric system that will minimize the risk of injuries and keep electric rates as low as
possible. In service of this goal, Utility Rules and Regulations currently require that
transformers and associated equipment (“equipment”) in underground utility districts be pad-
mounted, even where wires and conduit are undergrounded. While it may sometimes be
technically feasible to install equipment in underground vaults, this sort of fully subsurface
installation is substantially more expensive than a standard pad-mounted installation, and—in
the view of CPAU staff—is likely to be less reliable and more costly to maintain and operate
than a standard installation.
In some of CPAU’s oldest underground utility districts, equipment is fully subsurface and is
installed in decades-old underground vaults. These installations, though typical of the
engineering of their era, are considered by CPAU (and specialist utility engineers) to be non-
standard and operationally less desirable than a pad-mounted installation. A number of these
fully subsurface systems are reaching the end of their useful lives and need to be rebuilt. CPAU
normally replaces installations that have reached the end of their useful life with standard
installations. Such replacement is done by CPAU at its own expense.
City of Palo Alto Page 2
Largely because of objections to the aesthetics of standard pad-mounted equipment, some
property owners in at least one of City’s underground utility districts have requested that the
existing installation be replaced with a new fully underground installation. Such an installation
would have substantially higher installation, operation, and maintenance costs than a standard
installation.
As CPAU’s standard practice is to install pad-mounted equipment, the existing Rules and
Regulations do not provide the residents of an underground utility district with an option to
have obsolete equipment and vaults replaced with a new fully subsurface (and therefore non-
standard) installation. In order to afford residents the opportunity for such a replacement
project without burdening other system ratepayers with the associated added costs, staff has
developed a process that would permit property owners to request a subsurface installation if
they are able to self-fund the added costs. This self-funding option would permit the
installation of fully subsurface replacement equipment only if: (i) CPAU finds that a fully
subsurface installation is feasible, (ii) the underground utility district is currently served with a
fully subsurface installation, (iii) the new fully subsurface installation is requested by owners of
60% of the parcels served in the district, and (iv) the community pays all anticipated
installation, maintenance, and operating costs of the fully subsurface installation that are
greater than the costs of a standard installation.
Under the self-funding option, it would be the responsibility of the proponents of the non-
standard installation to accumulate the funding necessary for the added costs. The City would
not use its governmental authority to compel any property owner to make payment, but would
instead accept a lump sum, up-front payment from proponents. The proponents would
presumably raise the money for this payment from their own funds and by seeking voluntary
contributions from the other property owners who would be served by the installation.
The UAC supported the proposed self-funding option by a four-to-one vote. The dissenting UAC
member opposed creating a mechanism for the installation of this sort of non-standard
installation. There was some interest from the UAC in the creation of a method where property
owners could pay for the installation in installments. Upon further research, staff (for the
reasons discussed later in this report) determined that an installment-payment option would
not be feasible. UAC members also requested a lengthening of the period for requesting a
subsurface installation and the period for collecting the lump sum payment. The attached
resolution incorporates these extended deadlines.
Background
Underground Utility District 15 (“UUD 15”), the area bounded by Arastradero Road, Pomona
Avenue, Glenbrook Drive, and Los Palos Avenue (also known as Green Acres I), was constructed
and completed in 1973. To maintain reliability of the electric system, CPAU needs to replace the
45-year old transformers and cables and bring the system up to current design standards.
City of Palo Alto Page 3
In 1973, UUD 15 was constructed using entirely subsurface equipment in concrete vaults.
CPAU‘s current standard for equipment in underground utility districts is to install pad-mounted
equipment (above ground equipment sitting on a concrete pad) with only the cables installed
below ground. This design aligns with CPAU’s responsibility to build a safe, reliable, and cost-
effective electric system that will minimize the risk of injuries and outages and keep electric
rates as low as possible. The proposed design using pad-mounted equipment met with
opposition from a number of residents in Green Acres I, who expressed concerns over
aesthetics, safety and property values. Staff presented a report at the August 1, 2018 UAC
meeting (report) explaining the safety, reliability and cost justifications for CPAU’s standard for
pad-mounted equipment. At that meeting the UAC also heard comments from Green Acres I
community members. The UAC requested that CPAU staff work with residents on design
alternatives to accommodate aesthetics and safety.
Subsequently, staff presented a design alternative to residents and attempted to answer
residents’ questions. The feedback staff received from community representatives was that any
pad-mount equipment was not an acceptable solution and they wanted to work with CPAU on
a fully undergrounded system. At the December 5, 2018 UAC (report) meeting staff provided
an update and sought the UAC’s opinion on preparation of a Utilities Rule and Regulation
governing community-requested fully undergrounded systems.
At the April 9, 2019 UAC meeting (report) staff proposed amending Rule and Regulation 20 to
allow a community to request underground equipment if the community pays the additional
costs for undergrounding, both the incremental installation costs and ongoing ownership costs.
Staff’s proposal would treat a community request to install the non-standard fully subsurface
replacement installation similar to a special facilities request from a single customer. With
special facilities, CPAU determines if the request is feasible and then proceeds if the customer
funds the incremental cost.
Details of the proposed amendments to Rule and Regulation 20 are given in the above
referenced UAC report. The UAC discussed the proposal, and while generally supporting the
concept that if property owners requested the underground equipment, they should be
responsible for the additional costs, they had concerns about the timelines in staffs proposal. A
couple of Commissioners were also concerned about the proposal to leave the responsibility for
collecting the fees to property owners and thought that the City should play some role in
collecting the cost from each property owner. Excerpted draft minutes from the meeting are
shown in Attachment B.
Discussion
As equipment standards have evolved since the undergrounding of Green Acres I in 1973,
current functional and safety requirements cannot be met by simply reusing existing vaults in
the neighborhood. CPAU’s current construction and safety standards require installing no more
than one piece of equipment in a vault; multiple pieces of equipment in a single vault results in
reduced clearances and increases the chances of disruption of the equipment. As a result, in
City of Palo Alto Page 4
the Green Acres I neighborhood, simply maintaining the existing load-serving capacity would
still require extensive subsurface construction to relocate transformers to separate vaults from
secondary connections, hence the cost component for new vaults.
Green Acres I is not the only primarily residential district that has transformers and other
equipment placed underground in subsurface vaults. The undergrounding program started in
1965 and the first 33 districts were initially undergrounded with equipment placed in
subsurface vaults. Many of those original districts have already been rebuilt with the
placement of equipment brought up to current standards with pad-mounted equipment. Staff
has identified that, in addition to Green Acres I, there are another eight remaining districts that
are primarily residential that would switch from underground to pad-mounted equipment
when due for a system rebuild. If Council approves the proposal, the option would apply to all
nine districts, consisting of about 1,200 properties and 160 transformers. This is compared to
approximately 14,000 residential properties that remain in neighborhoods served by pole
mounted overhead electrical wires.
There are a couple of options to provide for funding of a special project.
One is a Rule and Regulation 20 amendment that would treat a community request to retain
the undergrounded electrical equipment much like a special facilities request from a single
customer. Under this model those requesting the special facilities are responsible for raising the
funds, and CPAU would proceed once the project was funded within a specific time period. This
self-funding option is the one that is recommended by staff and is implemented in the attached
resolution.
Another option, which is not recommended by the UAC or by staff, is to establish a benefit
assessment district. With a benefit assessment district, the City would hire an engineer to
allocate amongst the parcels served by the new installation the extra costs associated with that
installation. Under the state constitution, this allocation would need to be done based on the
“proportional special benefit” of the replacement system to each parcel. The City would then
collect from each parcel (either in installments or as a single payment) that parcel’s share of the
special benefit costs. Any benefit assessment would need to be approved by the affected
property owners in a mail-ballot protest proceeding. Such a proceeding is, in most respects,
essentially a mail ballot election at which property owner get to “vote” on the proposed
assessment. Ballots are weighted in such a proceeding by the amount of the assessment
against a parcel (so a parcel with a $1,000 assessment gets twice as many votes as a parcel with
a $500 assessment). This option is expensive to set up and (because it can impose a payment
obligation on property owners who do not support the assessment and do not believe that
their property benefits from a non-standard installation) may involve more risk of litigation.
Some members of the UAC expressed interest in having an option where payment for a self-
funded special installation might be spread out over time, rather than requiring that
proponents make full payment to CPAU prior to the commencement of work. Such an
City of Palo Alto Page 5
installment option is currently available to property owners in new utility undergrounding
districts to finance their on-parcel service connection work that is needed to connect to a new
(CPAU-funded) underground system.
Staff researched this possibility and determined that it would not be feasible. Under the
proposed self-funded method for a nonstandard installation, the City would take no role in
dividing the lump sum payment amongst the various parcels that would be served by the
installation. Proponents of the non-standard installation would be responsible for choosing
how to raise the funds for that payment. Since those proponents would have no ability to
compel contributions from community members who do not choose to contribute, it is likely
that most (or at least some) contributing community members—in order to make up for non-
contributers-- would need to pay more than their “fair share.” Collecting these voluntarily high
contributions, especially if a property changed hands during the repayment period, would be
difficult, practically and legally.
The existing installment plan for connection conversions is something that is specifically
authorized by state law for collection on the property tax roll with the security of a tax lien.
There is no such authorization for voluntary payments for a non-standard utility installation.
Likewise state law does not provide for collection in this manner for costs that exceed the
actual costs of the on-site work associated with the property on which the work is done.
Staff supports providing a neighborhood-funded option that requires a single lump-sum
payment before work commences. The Resolution in Attachement A takes this approach and is
shown with the extended timelines suggested during the April 9, 2019 UAC meeting.
Proposed Process
The attached resolution would create a new funding process that could be initiated by
property owners property owners in connection with any proposed CPAU project that will
install a standard undergound system to replace an existing fully subsurface system that is at
the end of its life.
Under this process:
1. A proponent of using the neighborhood-funding option for the project would need to
initiate the process within 30 days of CPAU distributing to property owners CPAU’s first
courtesy notice regarding the project. The proponent would initiate the process by
requesting that CPAU prepare a petition form.
2. CPAU would then prepare a petition form that provides a map of the area to be served,
explains the neighborhhood-funding process, the amount of the payment required to
cover the City’s cost of developing a cost-estimate for the proposed subsurface
replacement, as well as any additional infomraiton deemed necessary by the Utilities
Director. Proponents would have 45 days to collect signatures on the petition and
gather funds sufficient to cover the cost of developing the cost-estimate for the
City of Palo Alto Page 6
proposed subsurface replacement.
3. If the proponents return the petition with the signatures of owners of at least 60% of
the affected parcels, and accompany that petition with payment of the costs associated
with preparing a cost-estimate for a fully subsurface installation, CPAU will prepare such
an estimate, unless it determines that a fully subsurface installation is not practicable.
4. If, within 90 days of distributing the estimate, the City is paid the difference in costs
between the planned standard installation and the fully subsurface installation
(including the net present value of the higher continuing ownership costs), then CPAU
will construct the fully subsurface installation.
The ordinance gives the CPAU Director limited discretion to extend these deadlines and also
permits the CPAU director limited discretion to move forward with a standard installation,
rather than allowing the petition and community-funding process, if necessary for operational
reasons.
Resource Impact
The resource impact will depend on the allocation of the incremental installation and
maintenance costs, and the costs of creating a system to administer and allocate the expense of
proceeding with subsurface equipment in Green Acres I and other similarly situated districts.
CPAU has engineering estimates for Green Acres I based on recent quotes for equipment and
labor costs shown in Attachment C. This is not the full project cost as it only compares the
components that would change between the two designs; the replacement of electrical cables
will be a similar scope under both designs. The current FY2020 budget includes $419,609 for
the construction costs of the UUD 15 rebuild. This budget is based on CPAU’s standard design of
installing pad-mounted equipment. If the rebuild places all equipment in underground vaults
the up-front installation (equipment and labor costs) will increase by over $200,000. Ongoing
costs of ownership are estimated to add a further $275,000 over the 30-year expected life of
the equipment. Staff’s proposal is that UUD 15 property owners pre-pay the full $475,000 of
the incremental costs, while CPAU’s ratepayers cover the basic construction costs of around
$420,000; under this proposal there will be no impact to the FY2020 budget.
The proposed Special Facilities Fee shown in Attachment C is an estimate of the cost of
ownership given the additional cost of assets installed and also captures the cost of increased
energy losses attributed to underground equipment. CPAU does not currently record the cost
of maintenance by specific equipment type.
Cost estimates for the remaining eight districts that could potentially request to retain the
subsurface equipment during a rebuild are very preliminary, as detailed engineering design has
yet to be done for all eight. However, taking preliminary design estimate for those districts
currently in the design phase and extrapolating the results, CPAU estimates that the additional
up-front (equipment and labor) costs for subsurface equipment is in the range of $4M. Six of
these projects are in the Electric Utility’s current 5-year CIP and if CPAU’s ratepayers were to
City of Palo Alto Page 7
absorb the additional costs of subsurface equipment that would increase the 5-year CIP budget
for these six projects by 65% or $3.5M from $5.4M.
Policy Implications
A Council decision to adopt a Rule governing community requests for fully undergrounded
systems will require changes to Rule and Regulation 20.
It is worth noting in relation to the City’s Climate Action Plan; in general terms, the
underground district equipment replacement is anticipated to support future electrification of
the homes served within the district(s). As the City Council will be considering Energy Reach
Code actions later this calendar year, this could be a relatively unique amenity for homes
located within districts similarly situated.
Environmental Review
Council’s adoption of a resolution amending Rule and Regulation 20 (Special Electric Utility
Regulations) does not meet the California Environmental Quality Act’s (CEQA) definition of a
project under Public Resources Code Section 21065 and CEQA Guidelines Section 15378(b)(5),
because it is an administrative governmental activity which will not cause a direct or indirect
physical change in the environment, and therefore, no environmental review is required. The
installation of vaults, subsurface equipment and pad-mounted equipment to replace existing
equipment is categorically exempt from CEQA review under Sections 15301 and 15302 of the
CEQA Guidelines (repair, maintenance or minor alteration of existing facilities, and replacement
or reconstruction of existing facilities).
Attachments:
• Attachment A: Resolution Palo Alto Undergrounding Option
• Attachment B: Excerpt UAC draft minutes from 4-9-19
• Attachment C: Engineering Estimates for Green Acres
6055238 1
Resolution No. ________
Resolution of the Council of the City of Palo Alto Amending Utility
Rule and Regulation 20 to Allow Neighborhood Funding of Certain
Subsurface Equipment
R E C I T A L S
A. Since 1965, Sections 12.16.020 and 12.16.040 of the Municipal Code have authorized the
City Council to designate Underground Utility Districts (“UUD”) within the City.
B. The purpose of this designation is to require the replacement of existing poles, overhead
lines and associated overhead structures within each designated UUD.
C. In areas served by underground lines, Utility Rule and Regulation 3 currently requires that,
with few exceptions, all new transformers and other new equipment required to provide electric
service to customers be pad-mounted.
D. Pad-mounted equipment is generally more reliable and substantially less expensive to
install and maintain than subsurface (vault-mounted) equipment.
E. In some early UUD’s, equipment was installed subsurface, rather than pad-mounted. As
these installations reach functional obsolescence, CPAU has been replacing these installations with
pad-mounted equipment at its expense.
F. Before replacing an installation that has reached functional obsolescence, CPAU generally
sends a “courtesy notice” to customers served by the installation.
G. The City Council desires to amend Rule and Regulation 20 to provide a mechanism by
which neighborhoods can fund the replacement of obsolete subsurface equipment with new
subsurface equipment.
H. Pursuant to Section 12.20.010 of the Municipal Code authorizes the City Council, by
resolution, to adopt rules and regulations relating to utility service.
The Council of the City of Palo Alto hereby RESOLVES as follows:
SECTION 1. Utility Rule and Regulation 20 (Special Electric Utility Regulations) is hereby
amended to add Section K thereto, to read as follows:
“K. NEIGHBORHOOD FUNDING OF SUBSURFACE EQUIPMENT
1. REPLACEMENT OF SUBSURFACE EQUIPMENT
a. Notwithstanding the provisions of Rule and Regulation 3(B)(3), in UUD’s in which the existing
equipment required to provide electric service to customers is subsurface, the Utilities Director,
or his/her designee, may, at the end of the service life of such equipment vaults or equipment,
6055238 2
authorize their replacement with new subsurface equipment if the following conditions are
met:
(i) The Utilities Director, or his/her designee, determines that the installation of subsurface
equipment is practicable; and
(ii) Such installation has been requested by property owners in the manner set forth in this
subdivision K; and
(iii) The City receives funding for the subsurface installation as set forth in this subdivision K.
b. For purposes of this subdivision K, “Neighborhood-Funded Subsurface Installation” means all
vaults and equipment the installation of which has been funded pursuant to this subdivision K.
c. CPAU operates its utilities in accordance with Prudent Utility Practice. As is always the case with
CPAU’s Electric Distribution System and any CPAU-operated equipment, CPAU reserves the right
to operate, maintain, rehabilitate, and replace equipment at such time and in such manner as it
determines is necessary or useful for the safe and effective operation of the Electric Distribution
System. Consequently, nothing in this subdivision K should be interpreted to:
(i) Require that CPAU, at the end of the useful life of a Neighborhood-Funded Subsurface
Installation, replace that equipment with a subsurface installation; or
(ii) Prohibit CPAU, subsequent to the installation of a Neighborhood-Funded Subsurface
Installation, from installing pad-mounted equipment in the territory served by that
Neighborhood-Funded Subsurface Installation if the Utilities Director determines that such
installation is necessary or prudent; or
(iii) At any time prohibit CPAU from replacing all or part of a Neighborhood-Funded Subsurface
Installation with pad-mounted equipment if CPAU is required to do so by Law or if the Utilities
Director determines that the continued operation of all or part of the Neighborhood-Funded
Subsurface Installation presents an unacceptable hazard to public safety, employee safety, or
system reliability, or is contrary to Prudent Utility Practice.
2. REQUEST FOR PETITION FORM
a. Upon receiving a timely written request signed by owners of at least five parcels of real
property in an area served by a subsurface installation, CPAU will prepare the petition form
described in subdivision (3)(c) of this subdivision (K).
b. A request will be considered timely only if (i) it is submitted to the Utilities Director, or his/her
designee no later than 30 days following the distribution of the first courtesy notice regarding
the planned replacement of a subsurface installation or (ii) the Utilities Director determines
that the work schedule for such replacement will permit the time necessary for the process
described in subdivisions (3) and (4) of this subdivision (K).
c. Nothing in this subdivision (K) will be interpreted to require the preparation of a petition form
or the provision of time for circulation of a petition if the Utilities Director determines that
either the work schedule for a project or operational requirements will not make it practicable
to allow time for preparation and circulation of the petition and collection of funding by
proponents.
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3. REQUEST FOR SUBSURFACE EQUIPMENT
a. The owners of real property located in a Utility Undergrounding District may request the
replacement of existing vaults and equipment with new subsurface equipment by submitting a
petition to the Utilities Director, or his/her designee.
b. The petition must be signed by the owners of not less than 60% of the parcels in the Utility
Undergrounding District.
c. The petition must be on the form prepared by CPAU pursuant to subdivision (2) of this
subdivision (K). The form must include a map or description of the area to be served by the
Neighborhood-Funded Subsurface Installation; a summary of this procedure for Neighborhood
Funding of Subsurface Equipment; the amount of the payment required to cover the City’s cost
of developing a cost-estimate for the proposed subsurface replacement; as well as any
additional information deemed necessary or useful by the Utilities Director, or his/her
designee.
d. The form must indicate the name and contact information of one property owner who will
serve as proponent for the project and must indicate the date on which the form was issued to
that proponent and the amount of the payment required by subdivision (f) of this subdivision
(3).
e. To be valid, the signed petition must be returned to the Utilities Director, or his/her designee,
no later than 45 days after the form is issued to the proponent.
f. The signed petition must be accompanied by a payment to cover the cost of developing a cost-
estimate for the proposed subsurface replacement, as indicated on the form.
4. FUNDING OF SUBSURFACE EQUIPMENT
a. Upon receipt of a valid petition, the Utilities Director, or his/her designee, will provide the
proponent with either (i) a written estimate of the cost of a subsurface installation (including
the net present value of any unusual continuing ownership costs associated with such
installation) or (ii) a finding that such installation is not practicable. The proponent will also be
provided with an estimate of the cost of a standard installation.
b. The City will proceed with the subsurface installation if and only if within 90 days of the date
upon which the Utilities Director, or his/her designee, provides a written estimate pursuant to
subdivision (a) of this subdivision (4), the City receives payment in full for the estimated cost
difference between the subsurface and the standard installation.
c. It is the responsibility of the proponent to raise the funding required by this Section and the
entire cost must be paid to the City at one time. The City will not collect funds from property
owners or community members nor will it require any person or property owner to pay any
portion of the costs.
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d. The Utilities Director, or his/her designee, may extend the payment deadline set forth in this
subdivision.”
SECTION 2. The Council finds that the adoption of this resolution amending Rule and
Regulation 20 (Special Electric Utility Regulations) does not meet the California Environmental
Quality Act’s (CEQA) definition of a project under Public Resources Code Section 21065 and CEQA
Guidelines Section 15378(b)(5), because it is an administrative governmental activity which will
not cause a direct or indirect physical change in the environment, and therefore, no
environmental review is required. The installation of vaults, subsurface equipment and pad-
mounted equipment to replace existing equipment is categorically exempt from CEQA review
under Sections 15301 and 15302 of the CEQA Guidelines (repair, maintenance or minor alteration
of existing facilities, and replacement or reconstruction of existing facilities).
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
ATTACHMENT B
Utilities Advisory Commission Minutes Approved on: Page 1 of 6
UTILITIES ADVISORY COMMISSION MEETING
EXCERPT MINUTES OF APRIL 9, 2019 SPECIAL MEETING
CALL TO ORDER
Chair Danaher called the meeting of the Utilities Advisory Commission (UAC) to order at 7:00 p.m.
Present: Chair Danaher, Vice Chair Schwartz, Commissioners Forssell, Johnston, and Segal
Absent: Commissioners Ballantine and Trumbull
.
.
NEW BUSINESS
ITEM 1: ACTION: Utilities Advisory Commission Recommendation that the City Council Adopt a Resolution
Amending Utility Rule and Regulation 20 to Allow Neighborhood Funding of Certain Subsurface Equipment.
Michael Maurier clarified that attorney Kent Mitchell is representing 35-40 residents of Green Acres. The
residents appreciate Commissioners' attentiveness and responsiveness to their concerns.
Chair Danaher advised that undergrounding issues deserve careful study and consideration because the
issues will affect all neighborhoods located within underground districts.
Debra Lloyd, Assistant Director of Utilities Engineering, reviewed the history of undergrounding in the
Green Acres neighborhood. Pad-mounted equipment in underground areas is an industry and CPAU
standard. CPAU grants an exception to the standard if a customer pays a special facilities fee and added
construction costs. The exception typically applies to a single customer rather than a community. Staff
proposes amending Rule and Regulation 20 to allow a community to request underground utilities if the
community pays the additional costs for undergrounding. Amendments to Rule and Regulation 20 will
require staff to send a notice to residents or property owners about CPAU's intention to replace equipment.
A request for a petition form, signed by at least five property owners, must be filed with CPAU. CPAU will
prepare a petition form describing the proposed project. Residents will have 45 days following receipt of
the petition form to obtain signatures from at least 60% of property owners and to submit it to CPAU.
Residents must submit with the petition form a payment sufficient to fund CPAU's costs of developing an
engineering estimate for the project. Gregory McKernan, Senior Engineer, added that the typical advance
engineering fee is $5,000. Lloyd continued, stating CPAU will develop the engineering estimate and provide
it to the residents. Residents will have 60 days to pay CPAU the full estimated cost difference between
subsurface and standard installation. In the future, CPAU may have to respond to new safety rules and
regulations promulgated by the State and Federal Government. Future capacity requirements in the
underground districts may change with conversion to all-electric homes, use of electric vehicles, and
general neighborhood load increases.
In response to Chair Danaher's request for recent design changes to mitigate safety issues, Lloyd explained
that each vault will contain only one piece of equipment and the size of the vault is larger. Dean Batchelor,
DRAFT
ATTACHMENT B
Utilities Advisory Commission Minutes Approved on: Page 2 of 6
Utilities General Manager, added that a second vault, which will likely be located in the sidewalk area, will
house secondary equipment.
In reply to Commissioner Johnston's query regarding adding secondary switches to isolate outages
regardless of whether equipment is underground or pad-mounted, Batchelor indicated secondary switches
will be a part of the redesign. The redesign will include predicted increases in load.
In answer to Commissioner Johnston's request for information about the difference in reliability between
underground facilities and pad-mounted, Batchelor reported he could not find any information about the
difference in reliability.
Commissioner Johnston requested the number of districts with fully underground utilities and with pad-
mounted utilities. McKernan believed two districts have been rebuilt such that subsurface equipment was
changed to pad-mounted equipment. Approximately seven districts have fully underground equipment.
In response to Commissioner Segal's query about the differential between underground and pad-mounted
equipment in relation to locating the source of an outage, Batchelor related that including electronics in
equipment will make finding the source of an outage easier. McKernan clarified that access to equipment
determines the difficulty of locating an outage source. Underground vaults are sometimes filled with water
that has to be removed before the equipment can be checked for a fault. Pad-mounted equipment does
not fill with water.
Vice Chair Schwartz remarked that standards have evolved to increase safety. Putting people in small
spaces where they risk electrocution is no longer considered safe. In walking through many neighborhoods
over the weekend, she observed neighborhoods with and without pad-mounted equipment. Pad-mounted
equipment does not detract from the beauty of neighborhoods. In Capitola, the transformer boxes are
painted. If pad-mounted equipment is deemed necessary, perhaps neighborhoods could hold art
competitions and select artwork for the transformer boxes. Some residents do not object to pad-mounted
equipment and, if technically feasible, maybe the equipment could be located on those residents'
properties.
Commissioner Johnston appreciated the desire for fully underground equipment; however, current safety
rules prevent CPAU from undergrounding utilities in the same manner utilized in the past. Fully
underground equipment is a benefit to the specific neighborhood in that all ratepayers do not share in the
benefit. Neighborhoods should pay the additional cost of undergrounding.
Commissioner Forssell commented that CPAU did not grant the Green Acres neighborhood a right to
underground utilities by installing the underground equipment in the 1970s. Equipment has a useful life,
and the useful life of underground equipment in Green Acres has passed. Given that the benefit of
underground equipment accrues to the particular neighborhood, it would be appropriate for the
neighborhood to pay. Mr. Mitchell's letter seems to imply that the entire underground system will be
placed aboveground. Much of the equipment will be underground, but the transformer boxes will be
aboveground.
Commissioner Segal had not heard anything suggesting aboveground equipment does not meet CPAU's
mission to provide safe, reliable, and cost-effective utilities. Belowground equipment may meet the safe
and reliable components of the mission, but it does not meet the cost-effective component. An alternative
design does meet the cost-effective component.
Vice Chair Schwartz felt asking all ratepayers to pay for removal of transformer boxes in a few
neighborhoods is not reasonable. Staff proposes at least 60% of property owners must support the request
ATTACHMENT B
Utilities Advisory Commission Minutes Approved on: Page 3 of 6
to underground. The remaining 40% of property owners may be unfairly burdened with paying their portion
of the cost. She did not wish to create divisiveness among neighbors.
Chair Danaher remarked that only a small portion of Palo Alto's population has access to fully underground
utilities. Imposing the cost of undergrounding on the entire population is unfair. Neighborhoods should
have the choice to pay for undergrounding utilities. If the majority of property owners want to
underground utilities, CPAU should provide ways to spread the cost over time.
Vice Chair Schwartz could not believe an aboveground transformer would result in a loss of property value,
give the high demand for property in Palo Alto.
Commissioner Johnston expressed concern regarding residents receiving a mailed notice of the project. The
ten-day period for five property owners to submit a request for petition form seems short. The petition
form should state the cost of developing an engineering estimate. The 45-day period and requirement for
60% support are fine. The 60-day period for full payment of the cost difference makes the proposal
unworkable. Property owners should be able to pay over time, perhaps with interest. He was unsure
whether property owners who want underground utilities or all property owners should pay the additional
cost. Staff proposes all property owners contribute to the additional cost. Lloyd explained that the
requirements mirror those for special facilities. When overhead facilities are undergrounded, each property
owner pays for a service connection. If undergrounding is determined to provide a general benefit, CPAU
shares the cost of undergrounding overhead wires and installing equipment with Comcast and AT&T. If
undergrounding provides a local benefit, up to 75% of the cost could be allocated to property owners.
Commissioner Segal agreed that the 60-day period is not long enough. In response to her question about
adding the cost to property owners' utility bills, Lloyd advised that would require a different process. To
keep the process simple and to mirror the special facilities process, a collection mechanism other than the
utility bill is needed. Batchelor clarified that the current billing system cannot process special charges. Staff
would have to add a charge for undergrounding to each bill by hand.
Commissioner Segal was struggling with the approach to amending Rule and Regulation 20 being driven by
the limitations of the billing system. The approach should be driven by what makes sense for a district.
Vice Chair Schwartz commented that allowing a neighborhood to determine the details of CPAU projects
sets a bad precedent. In answer to Commissioner Johnston's query of whether Vice Chair Schwartz felt pad-
mounted equipment should be required in all districts, Vice Chair Schwartz believed allowing
neighborhoods to make engineering decisions is problematic. Commissioner Johnston asked if Vice Chair
Schwartz was saying no neighborhood should have an option to underground. Vice Chair Schwartz replied
no. Amending Rule and Regulation 20 is a policy change that could be applied to any project in the City.
Chair Danaher did not believe the amendments to Rule and Regulation 20 have to be applied to other
projects. Whether to apply the policy direction to other projects would be a future decision. Vice Chair
Schwartz stated meeting with residents and discussing residents' preferences is appropriate, and staff
should do that. That is not the same as changing Rule and Regulation 20. Commissioner Johnston noted
Rule and Regulation 20 is specific to replacement of subsurface equipment. Any district in the same
situation as Green Acres I would have the option to pay for underground facilities. Vice Chair Schwartz
reiterated that amending Rule and Regulation 20 would set a bad precedent.
Chair Danaher believed the 10-day period should be at least 30 days. There should be an option for
property owners to host a staff presentation about the project. The main issue is distributing the cost
among property owners. Property owners could contribute based on household square footage or some
property owners could pay more than their share. The default position could be a pro rata distribution of
ATTACHMENT B
Utilities Advisory Commission Minutes Approved on: Page 4 of 6
the cost with an option for property owners to voluntarily pay more than their portion of the cost. Property
owners should be allowed to pay over a five, eight, or ten-year period.
Commissioner Forssell suggested property owners be allowed to determine the distribution of the cost
among property owners. Property owners should be allowed to pay the special facilities fee over time but
the cost of materials and labor upfront. Lloyd advised that a special assessment district may be needed. To
provide property owners with the amount they need to pay would require another process.
Vice Chair Schwartz assumed the new billing system would support on-bill financing.
At Chair Danaher's request for a brief update regarding Computer Information System (CIS)
implementation, Batchelor reported the Information Technology (IT) Department wants to delay the CIS
upgrade by two years because of limitations on resources and the need to determine the desired features
of a CIS. It appears SAP will be upgraded to the most recent version.
In answer to Commissioner Segal's inquiry regarding the Green Acres project being on hold, Batchelor
indicated it is on hold. Special fees are typically used for commercial accounts. CPAU does not have a rule
and regulation that allows it to charge a district for work and provide on-bill financing for the work.
Chair Danaher clarified the recommendation as the City Council permitting neighborhoods to elect to retain
underground transformers provided that the district absorbs the marginal cost. If the Council approves the
recommendation, staff will return with a proposed process for neighborhoods to request retention of
underground transformers.
Commissioner Johnston inquired whether staff prefers to present the Council with a concept that
neighborhoods can elect to retain their facilities completely underground or with a detailed draft
regulation. Batchelor preferred to present the Council with a proposed regulation.
Vice Chair Schwartz interpreted the attorney's letter as indicating Green Acres residents want fully
underground facilities but do not want to pay for them.
[Comments made off camera and off microphone by a member of the public are inaudible.]
Commissioner Johnston stated Vice Chair Schwartz wants to know if the neighborhood's position is CPAU
pays for the project or the neighborhood is not interested. In which case, Commissioners may not have to
agonize about a payment procedure.
Vice Chair Schwartz suggested staff determine alternative placements for pad-mounted devices and ask
property owners around the alternative placements if they are willing to host the devices.
Commissioner Segal noted the Council had not provided an opinion regarding undergrounding. The UAC
should recommend a district pay the differential cost of pad-mounted versus underground equipment. If
the Council approves the recommendation, the UAC can propose a mechanism for payment of the
differential cost.
In reply to Chair Danaher's request for the number of households in the Green Acres district, McKernan
indicated approximately 100 households.
Chair Danaher preferred to allow property owners to pay over time so that the charge would be less of a
burden for residents.
ATTACHMENT B
Utilities Advisory Commission Minutes Approved on: Page 5 of 6
An unidentified member of the public remarked that property owners have no information about the
undergrounding project. Property owners are waiting for an opportunity to review alternative designs.
Chair Danaher suggested staff share alternative designs with residents so that residents can determine who
might agree to bear the cost and whether an upfront payment or payments over time are preferable.
Lloyd reported that she had attempted to find less visible locations for pad-mounted equipment and
presented information to the Green Acres Board. The Green Acres Board was not willing to discuss pad-
mounted equipment, only fully underground equipment. Staff needs to know where equipment can be
located in order to prepare an engineering study. Staff has prepared a design for a subsurface solution.
Commissioner Johnston believed the Council should determine before staff does further work whether
CPAU will pay 100% of costs for fully underground equipment; whether the neighborhood will have an
option to pay the cost of keeping equipment underground; or whether pad-mounted equipment will be
required in all districts.
Batchelor concurred with presenting a concept to the Council and returning to the UAC to develop details
as directed by the Council.
Vice Chair Schwartz believed the Council should decide whether anybody pays for the additional costs.
Commissioner Forssell proposed Commissioners indicate their support for CPAU paying 100% of costs, the
district sharing in the costs, or CPAU requiring pad-mounted equipment in all districts.
Chair Danaher understood a number of Commissioners would support a choice for property owners with
the property owners bearing the additional cost. Vice Chair Schwartz appears to be less inclined to allow a
choice. Vice Chair Schwartz clarified that additional choices are available to property owners, such as
finding eight to ten households who are willing to host pad-mounted equipment.
Commissioner Segal proposed a recommendation that a utility district pay the differential in expense to
maintain transfers underground. Chair Danaher amended the recommendation to a utility district will have
the option by supermajority vote of the residences to maintain transformers underground provided that
the extra cost is borne by the district.
ACTION: Commissioner Segal moved to recommend to City Council that an underground utility district have
the option with a supermajority vote of district customers to pay the differential in expense to maintain
transformers underground. Commissioner Forssell seconded the motion. The motion carried 4-1 with Chair
Danaher and Commissioners Forssell, Johnston, and Segal voting yes, Vice Chair Schwartz voting no, and
Commissioners Ballantine and Trumbull absent.
Chair Danaher requested staff provide residents of Green Acres with the alternative designs for the
undergrounding project.
Mr. Maurier stated the residents' main concern is the lack of information about proposed designs. Without
information, residents cannot make any decisions.
Commissioner Johnston clarified that residents would receive information about the project along with the
notice.
Attachment C
Engineering Estimates for Green Acres I Rebuild
Figure 1: Cost Comparison for Green Acres Neighborhood
The calculation of the proposed Special Facilities Fee component is illustrated in Figure 2
Unit Cost Estimates for Above Vs. Below Ground Equipment and Installation
(A)
Above ground Pad-
mount Equipment
(Transformers &
Loadbreaks)
(B)
Above ground
Pad-mount Loop
Feed
Transformers
(No Loadbreaks)
(C)
Above ground
Pad-mount
Transformer
(D)
Above ground
Pad-mount
Loadbreak
(E)
Below ground
Submersible
Equipment
(Transformers &
Loadbreaks)
(F)
Below
ground
Submersible
Loadbreak
(G)
Below
ground
Submersible
Transformer
Transformer 1,854$ 4,170$ 1,854$ -$ 5,719$ -$ 5,719$
Load Break (Switch)1,277$ -$ -$ 1,277$ 536$ 536$ -$
Misc, Equipment 2,748$ 1,056$ 1,056$ 1,056$ 956$ 956$ 956$
Pads/ Vaults 5,312$ 1,075$ 1,075$ 775$ 12,552$ -$ 12,552$
Sub Total 11,190$ 6,301$ 3,985$ 3,108$ 19,763$ 1,492$ 19,227$
Substructure Instalation 20,861$ 11,909$ 11,909$ 11,909$ 24,632$ -$ 24,632$
Equipment 15,478$ 9,594$ 9,594$ 9,594$ 15,478$ 10,835$ 10,835$
Sub Total 36,339$ 21,503$ 21,503$ 21,503$ 40,110$ 10,835$ 35,466$
15% Incidental $7,129 $ 4,171 $ 3,823 $ 3,692 $ 8,981 $ 1,849 $ 8,204
Total Cost $ 54,658 $ 31,974 $ 29,311 $ 28,302 $ 68,854 $ 14,176 $ 62,898
Cost Differential Between the Two Green Acres Designs
Design Description Material Labor Total Cost
Utility Standard
(Above Ground)
2 transformers with
loadbreaks, 4 loop feed
transformers, 2
transformers only and 3
loadbreaks only
(2xA)+(4xB)+(2xC)+(3xD)
$ 74,608 $ 306,132 $ 380,741
6 transformers with
loadbreaks, 3
loadbreaks only and 2
transformers only
(6xE)+(3xF)+(2xG)
$ 185,740 $ 395,710
Special Facilities Fee*
Cost Differential between Padmount and Submersible Equipment 475,542$
* Special Facilities Fee is the present cost of ownership and energy losses
$274,833
Cost Components
Home-owner
Requested
(Below Ground)
$ 856,282
Utility Standard Pad-Mounted Requested Below-Ground
Material and Labor Unit Costs
Materials
Labor
Attachment C
Engineering Estimates for Green Acres I Rebuild
Figure 2: Proposed Maintenance and Operations Fee Calculation
Description
Materials 111,131$
Labor 89,578$
Other -$
Estimated Job Cost Differential 200,709$
Annual Cost of Ownership Factor 0.067
Annual Cost of Ownership 13,448$
Term 30
Discount Rate 3%
Present Value of Annual Cost of Ownership $263,577
Present Value of Annual Energy Losses 11,255$
SPECIAL FACILITIES FEE (2+3)$274,833
TO:
CITY OF
PALO
ALTO
HONORABLE CITY COUNCIL
7
FROM: DEAN BATCHELOR, DIRECTOR OF UTILITIES
DATE: SEPTEMBER 16, 2019
SUBJECT: AGENDA ITEM NUMBER 7-STAFF AND UTILITIES ADVISORY COMMISSION
RECOMMENDATION THAT THE CITY COUNCIL ADOPT A RESOLUTION AMENDING
RULE AND REGULATION 20 TO ALLOW NEIGHBORHOOD SELF-FUNDING OF
CERTAIN SUBSURFACE EQUIPMENT
1. Utility Underground Districts with Resident Contribution.
Utilify Underground District {UUD) 15 was requested in 1972 by the residents. At the time it
was deemed to fall under the "local benefit" provision of the respected rule and regulation. The
cost split for UUD 15 in the street right-of-way was bore 25% by the residents and 75% by the
utility, of which the 25% contribution amounted to $310.25 per lot. The cost of converting the
private electrical services on the private property portion of UUD 15 was completed by the city
at the additional cost of $300 per lot.
UUD 25 was requested in 1983 by the residents on Orme Street. At the time it was deemed to
fall under the "local benefit" provision of the respected rule and regulation. The cost split for
this UUD 25 in the street right-of-way was bore 25% by residents and 75% by the utility, of
which the 25% contribution amounted to $873 per lot. The cost of converting the private
services on the private property portion of UUD 25 was solely on the residents.
2. Rule and Regulation 17 (Method for Undergrounding)
Under Rule and Regulation 17 there are three different mechanisms for converting overhead
utilities to underground utilities {Undergrounding).
1. Areas of General Public Interest and Benefit
2. In Areas Primarily of Local Public Benefit
3. In Areas of Insufficient Public Benefit to Qualify Under Either
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Areas of General Public Interest and Benefit relates to areas that have a heavy concentration of
overhead and communication facilities, a road or right-of-way that is used extensively by the
public and carries a heavy volume of vehicular traffic, or street or right-of-way near public
recreation areas or areas of scenic interest. When undergrounding using this method, the utility
pays 100% of the cost of undergrounding the overhead equipment as well as receiving a
financial contribution from AT&T to underground its or its leasees equipment. The residents or
businesses are required to complete their own electric service, private property conversion at
their own expense.
Areas Primarily of Local Public Benefit relates to areas that undergrounding is a general public
interest, but primary of local benefit. When undergrounding using this method, the utility pays
50% of the cost of undergrounding its overhead lines with 50% covered by the residents. The
cost of undergrounding the communication lines, AT&T, fiber, etc. and the private services shall
be bore entirely on the residents.
Areas of Insufficient Public Benefit to Qualify Under Either requesting to be undergrounded
would be responsible for 75% of the cost while 25% would be paid by the utility. The cost of
undergrounding the communication lines, AT&T, fiber, etc. and the private services shall be
bore entirely on the residents.
3. Current Cost Breakdown for UUD 15
Total cost for completing a pad mounted design
Total cost for completing a subsurface design
Difference in cost
Special facilities charge for a subsurface design
$380,000
$580,000
$200,000
$275,000
Cost difference between a pad mounted and subsurface design with special facilities $475,000
The special facilities charge is used to amortize the difference in cost. The cost difference has an
annual ownership factor of 6.7%. The present value cost is calculated using a 30-year term with
a rate of 3%. There are also additional energy losses associated with subsurface transformers
that are also calculated into the total cost.
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4. Pad Mounted Equipment Policy
In 1996, staff presented information to the UAC and Council requesting that for safety,
reliability, and cost reasons, pad-mounted equipment should be the standard installation for all
new underground construction. In April 1996, Council approved Resolution 7580 requiring the
above ground location of pad-mounted equipment for new underground electric facilities.
Section B (3) of City of Palo Alto Rule and Regulation 3 (Description of Utility Services) sets forth
the pad-mount standards and requirements, specifically that "All new equipment in
underground areas required to provide electric service to a customer shall be pad-mounted."
The Utilities Director may authorize an exception to this requirement in cases where pad-
mounted equipment is not feasible or practical, and in those situations the customer would
be responsible for additional costs related to sub-surface construction, in the form of a Special
Facilities fee. The justification for pad-mounted equipment presented back in 1996 still applies
today. Pad-mounted equipment is the industry standard for underground construction. Utilities
that installed subsurface equipment in the past are replacing it with pad-mounts when they
can, and new installations are all pad-mounted unless there are extenuating circumstances,
such as when there is no physical space for pad-mount equipment, e.g. the downtown
University and Cal Avenue area that has zero lot line building construction and would require
pad-mounted equipment to be installed in alleys, sidewalks or streets obstructing pedestrians
and vehicles.
Dean Batchelor
Director of
Utilities Department
Ed Shikada
City Manager
3 of3
City of Palo Alto (ID # 10615)
City Council Staff Report
Report Type: Action Items Meeting Date: 9/16/2019
City of Palo Alto Page 1
Summary Title: Evaluation and Discussion of Potential Revenue Generating
Ballot Measures and Budget Amendment
Title: Evaluation and Discussion of Potential Revenue Generating Ballot
Measures
and Confirmation of Finance Committee Recommended Parameters for Tax
Structure and Further Analysis; and Approval of a Budget Amendment in the
General Fund
From: City Manager
Lead Department: Administrative Services
Recommendation
1) The Finance Committee and staff recommend that the City Council review, provide
comments and direct staff to continue work regarding a potential revenue generating ballot
measure with the following parameters:
a. Consider a general business tax measure focused on head count or square footage
as the units of measure;
b. Consider a parcel tax measure focused on square footage as the unit of measure;
c. Potential revenue proceeds allocations to transportation and/or affordable housing
shall be determined at a later date and informed by polling;
d. Continue further refined analysis on potential exemptions and tiered tax rate
structures with the following guidance: maintaining estimated revenue generation
between 1 and 6 percent of General Fund revenues, focus on implications regarding
retail, restaurants, hospitality, and medical industries, and keeping potential tax
structures simple and modern minimizing exemptions;
e. Continue to review any potential ballot measures as either a general tax (with non-
binding advisory language on intended use of funds) or a special tax measure; and
f. Consider a parcel tax or General Obligation (GO) Bond for unfunded infrastructure
projects at a later date; and
g. Discuss next steps including continued stakeholder engagement and potential
polling.
City of Palo Alto Page 2
2) Staff recommends that the City Council amend the Fiscal Year 2020 Budget Appropriation
Ordinance for the General Fund by:
a. Increasing the Administrative Services Department appropriation for contractual
services in the amount of $75,000; and,
b. Decreasing the Budget Stabilization Reserve in the amount of $75,000.
Summary
This report transmits to the full City Council work that began as part of the 2019 Fiscal
Sustainability workplan approved by Council in April 2019 and has been reviewed and discussed
by the Finance Committee beginning in June 2019 regarding potential revenue generating
ballot measure(s). Included in the body of this report is a high-level summary of the work
completed by staff with the Finance Committee to-date. Staff and the Committee are seeking
the full Council’s review and approval of the progress made thus far and confirmation of the
identified next steps and focus of continued staff work on potential revenue generating ballot
measure(s).
As was outlined in the original workplan for this effort, it is staff’s intent that this be an iterative
process providing information at a steady pace and allowing for continued review and refining
of proposals and analysis. As directed by Council, the Finance Committee serves as the working
body to assist in the review of potential revenue generating initiatives and provide
recommendations for consideration and action by the City Council.
Background
The Finance Committee and staff have been working to evaluate potential revenue generating
proposals, in alignment with the 2019 Fiscal Sustainability work plan (City Manager Report
#10267: www.cityofpaloalto.org/civicax/filebank/documents/70506) and secondary workplan
for a potential revenue generating ballot measure (City Manager Report #10261:
www.cityofpaloalto.org/civicax/filebank/documents/70507) that were both approved in April
2019 by Council. Below summarizes the two meetings that have been held with the Finance
Committee:
June 18, 2019 Finance Committee Meeting: Review, Comment, and Accept Preliminary
Revenue Estimates for Consideration of a Ballot Measure
City Manager Report #10392:
www.cityofpaloalto.org/civicax/filebank/documents/72101
Action Minutes:
www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=53170.55&BlobID=73283
Sense Minutes:
www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=53170.55&BlobID=73285
City of Palo Alto Page 3
In the Finance Committee’s first iterative discussion in June, the Committee considered all
potential tax options, which include a parcel tax, issuance of a General Obligation (GO) Bond, a
sales and use tax increase, a transient occupancy tax increase, a documentary transfer tax
increase, a utility users tax increase, and several business tax structures. A detailed description
of the various taxes the City of Palo Alto collects, some general information about the taxes and
the drivers for them, and lastly potential revenue increases that could be seen if the tax rates
were changed, or a new tax was imposed.
At this meeting the Committee aided in narrowing the more refined analysis of staff to three
types of tax measures:
• GO Bond issuance
• Parcel Tax
• Business Tax: Employee Head Count, Square Footage, and Payroll Expense
Though ultimately not included, there was some discussion and desire to potentially continue
to include a Sales Tax measure as well. The Committee agreed to the use of a framework to
help think through potential measures, E.A.S.E.:
EQUITY Who does the tax impact and how is the impact felt across all
residents or businesses in the same industry?
ADMINISTRABILITY How is the tax administered and what would be the cost of
compliance on taxpayers and the City?
STABILITY What are the drivers of the tax revenue and how does the tax type
in question affect the volatility of the revenue over time (including
potential recessionary or modernization scenarios)?
ECONOMIC BENEFITS Is the tax efficient, promotes economic development objectives
and minimize disruption on the taxpayer?
June 18, 2019 Finance Committee Additional Resources:
➢ Video: midpenmedia.org/finance-committee-50-6182019-2/
➢ Presentation:
www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=42443.89&BlobID=72200
August 20, 2019 Finance Committee Meeting: Evaluation and Discussion of Potential Revenue
Generating Ballot Measures
City Manager Report #10455:
www.cityofpaloalto.org/civicax/filebank/documents/73071
Action Minutes:
www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=53148.14&BlobID=73282
City of Palo Alto Page 4
Staff returned to the Finance Committee and provided increasingly detailed and complex
analysis. It focused on the narrowed parameters provided by the Committee and provided
additional context on past election results; legal restrictions and concerns; a high-level,
estimated range of revenue the tax will generate; the City’s and comparable agencies’
employment and industry trends, and other relevant information that may be of value to the
Finance Committee and stakeholders. The E.A.S.E. framework is discussed under each revenue
type so that these principals can be considered as policy decisions are considered during the
process. Detailed analysis is included for the following:
• GO Bond issuance: scenarios ranging from $100 million in debt issuance to $500 million
in debt issuance. A GO Bond would require 2/3 voter approval.
• Parcel Tax: models two potential units of measure, a flat rate or a rate by square
footage. Parcel Taxes typically require 2/3 voter approval.
• Business Tax: models three potential units of measure, employee head count, square
footage, and payroll expense. Staff received assistance from a consultant firm to
complete extensive benchmarking of business taxes in various jurisdictions which is
included in this report. Business Taxes may be a general (majority voter approval) or a
special (2/3 voter approval) measures.
As noted above, the City engaged Matrix Consulting Group (Matrix) to conduct research that
will assist in development of a potential business license tax. The scope of the engagement
included:
• comparative research of selected Bay Area communities to understand each agency’s
business license tax practices regarding the development, implementation, and
administration of each program; and
• performance of data analysis and modeling, based on available data resources, of the
potential revenue range the City may generate if a business license tax measure were to
be approved by the voters.
August 20, 2019 Finance Committee Additional Resources:
➢ Video: www.midpenmedia.org/finance-committee-50-8202019/
➢ Presentation:
www.cityofpaloalto.org/civicax/filebank/blobdload.aspx?t=72721.13&BlobID=73127
Discussion
In the most recent August discussion with the Finance Committee, the Committee heard from
staff, the City’s consultant, and members of the public, and spent hours discussing the more
refined revenue estimates and potential intricacies of tax structures and implications. The
Committee focused on four areas for discussion and further narrowed staff’s future focus as
outlined below.
City of Palo Alto Page 5
A. The type(s) of tax measures that staff should continue to focus on for further analysis and
research.
- Continue to evaluate a general business tax based on either head count or square
footage as the metric as well as a parcel tax based on square footage.
- Specifically, expand benchmarking of other cities to include identification of data sources
used to audit and/or regulate the tax.
B. Evaluation and articulation of the types of tax structure, such as potential exemptions
(beyond those legally required), and flat rate versus tier pricing structures.
- Continue to evaluate both flat and tiered pricing structures.
- Maintain ultimate revenue generation between 1 percent and 6 percent of General Fund
revenues.
- Analysis and costing for exemptions, focusing on those legally required by state/federal
law, as well as exemptions for public utilities, hospitality, retail, restaurants, and small
medical facilities/clinics.
C. Major characteristics of a potential tax, such as a phase-in of a new tax, both
implementation period as well as rate phase-in, or sunset provision ending the tax after a
certain period.
- Continue further analysis evaluating both a general tax (with non-binding advisory
language on intended use of funds) or a special tax measure and the legal parameters of
these.
- If necessary, phase-in a new tax rate looking at impact on average business.
- Keep a focus on a manageable structure, limiting complexities, however, address the
modern economic climate and realities; for example definition of an “employee” under a
headcount-based tax. Provide additional comparable data on definitions such as this.
D. Discuss the potential uses of taxes.
- Provide an itemized list of potential City funding needs (similar to that provided in the
annual Long Range Financial Report) matrix to evaluate uses of taxes versus those whom
the tax would be levied on.
- The highest immediate priorities would be to levy a general business tax or similar for
transportation and/or housing investments.
- At a later date, consider a parcel tax or GO Bond for unfunded infrastructure projects.
While the Committee provided recommendations on the costing for certain limited
exemptions, the Committee deferred full discussion of desired exemptions to allow for review
of potential financial conflicts of interest. That review is ongoing. The discussion of exemptions
by Council at this meeting may be similarly limited or structured to maximize participation by
Councilmembers in light of conflict of interest requirements.
City of Palo Alto Page 6
As of the drafting of this report, the above items are currently being researched and compiled
by staff and Matrix. Staff plans to provide the Finance Committee and Council with this
information in the next phase of the process.
Next steps in this process will be to continue to review and discuss with the Finance Committee,
City Council and stakeholders, narrowing the focus of further staff analysis so that more
complex scenarios can be modeled including adjusting for any potential exemptions in addition
to the legally mandated ones, more analysis on different pricing levels and structures, and
implications on parties and industries that would be assessed an increased or new tax. As the
focus of further staff analysis is narrowed, more discrete analysis and discussion of implications
such as potential areas of tax leakage and impacts on the economic environment and tax
ecosystem will be more viable and informative.
Timeline
As outlined in the original workplan, staff anticipate an iterative process as the Finance
Committee and the Council evaluate potential revenue generating measure. It is expected that
after this meeting, staff will return to the Finance Committee to continue to refine and analyze
potential tax measures. The workplan stipulates polling and stakeholder outreach to be
completed when ready and appropriate. Ultimately, the current workplan outlines a decision by
October/November on the core attributes of what type of measure to pursue including the
major variables for it to be based on.
Resource Impacts
The 2019 Fiscal Sustainability workplan identified this project as one that was not resourced by
either staffing or consultant funding. Staff have been absorbing this work with the assistance of
a consulting firm. As outlined in previous reports, this report recommends increasing
contractual appropriated funds to ensure sufficient budgeted funds for both consultant
assistance completed to date as well additional costs in order to complete this additional
analysis outlined in this report. Current consulting costs are estimated at $50,000 and staff is
working with the consultant to evaluate additional costs in relation to the work outlined above.
Therefore, staff recommends a budget adjust of $75,000.
Minor costs associated with the procurement of data have been incurred and will be absorbed
by the Administrative Services Department. Additional funds beyond those outlined in this
report may be necessary depending on future requests for additional analysis as well as
potentially future polling and/or citizen engagement.
Environmental Review
This report is not a project for the purposes of the California Environmental Quality Act (CEQA).
Environmental review is not required.
.
City of Palo Alto (ID # 10649)
City Council Staff Report
Report Type: Action Items Meeting Date: 9/16/2019
City of Palo Alto Page 1
Council Priority: Grade Separations
Summary Title: Recommendation to Comment on the Caltrain Business Plan
Long Range Service Vision
Title: Caltrain Business Plan - Direction to Staff Regarding Comments on Draft
Long Range Service Vision
From: City Manager
Lead Department: City Manager
Recommendation
Staff recommends Council discussion and direction on submittal of a comment letter in
response to Caltrain’s staff recommendations for the Caltrain Business Plan and its Long
Range Service Vision.
Background
The City Council conducted a study session on the developing Caltrain Business Plan on
May 13, 2019 (Report #10335). Since that time, Caltrain staff has released a Draft
Recommendation for Caltrain’s Long Range Service Vision. The summary report is
attached.
Specific recommendations are provided beginning on page 14 of the report, and
exerpted here:
CALTRAIN’S LONG RANGE SERVICE VISION – DRAFT LANGUAGE
The following is the specific, draft “Service Vision” language that the JPB would be asked to
consider for adoption in October. This language will be reviewed and revised based on input
from the Board and comments received through stakeholder and public outreach.
1) Caltrain’s Long Range Service Vision directs the railroad to plan for a substantially expanded
rail service that will address the local and regional mobility needs of the corridor while
supporting local economic development activities. When fully realized, this service will provide;
A. A mixture of express and local Caltrain services operated in an evenly spaced,
bidirectional pattern
City of Palo Alto Page 2
B. Minimum peak hour frequencies of; • 8 trains per hour per direction on the JPB-
owned corridor between Tamien Station in San Jose and San Francisco, extended to
Salesforce Transit Center at such time as the Downtown Extension is completed • 4
trains per hour per direction between Blossom Hill and Tamien Stations, subject to the
securing of necessary operating rights • 2 trains per hour per direction between and
Gilroy and Blossom Hill Stations, subject to the securing of necessary operating rights
C. Off-peak and weekend frequencies of between 2 and 6 trains per hour per direction
north of Blossom Hill and hourly between Gilroy and Blossom Hill, with future
refinements to be based on realized demand
D. Accommodation of California High Speed Rail trains, in accordance with the terms of
existing and future blended system agreements between the JPB and the California High
Speed Rail Authority
E. Delivery of these services will occur through the incremental development of corridor
projects and infrastructure to be further defined through individual planning process,
feasibility studies and community engagement. At this time, such infrastructure is
conceptually understood to include;
i. Investments in rail systems including a new, high performance signal system
ii. Station modifications including platform lengthening, level boarding, and investments
in station access facilities and amenities to support growing ridership and improve
customer experience
iii. New and modified maintenance and storage facilities in the vicinity of both terminals
as well as the expansion of the electrified Caltrain fleet
iv. A series of short, 4-track stations and overtakes at various points throughout the
corridor
v. Completion of key regional and state partner projects including
1. The Downtown Extension to the Salesforce Transit Center
2. The reconstruction of Diridon Station and surrounding rail infrastructure
3. The reconstruction and electrification of the rail corridor south of Control Point
Lick to the Gilroy Station
4. Additional improvements to allow for the operation of High Speed Rail service
between Gilroy and San Francisco
5. The substantial grade separation of the corridor as well as safety upgrades to
any remaining at-grade crossings, undertaken in a coordinated strategic manner
driven by the desires of individual local jurisdictions as well as legal requirements
associated with any proposed 4-track segments.
2) Caltrain’s Long Range Service Vision further directs the railroad to continue its consideration
of a potential “higher” growth level of service in the context of major regional and state rail
planning. Specifically, the Long Range Service Vision directs the railroad to;
A. Work with regional and state partners to study and evaluate both the feasibility and
desirability of higher levels of service in the context of major regional and state rail
initiatives including planning related to the Dumbarton Rail Corridor, the 2nd Transbay
Crossing, the potential for expanded ACE and Capitol Corridor services, and ongoing
City of Palo Alto Page 3
planning for the California High Speed Rail system.
B. To take certain actions to consider and, where feasible, not preclude such higher
levels of service as they specifically relate to; i. The planning of rail terminals and related
facilities ii. The sale or permanent encumbrance of JPB land iii. The design of grade
separations in areas where 4-track segments may be required iv. The sizing of future
maintenance facilities and storage yards
C. To return to the board with a recommendation regarding any formal expansion of the
Long Range Service Vision at such a time as clear regional and state policy and funding
commitments are in place and the feasibility of such an option on the corridor has been
confirmed
3) Finally, Caltrain’s Long Range Service Vision directs the railroad to periodically reaffirm the
Vision to ensure that it continues to provide relevant and useful guidance to the railroad. Such
reaffirmations should occur;
A. At a regular intervals of no less than 5 years
B. In response to significant changes to JPB or partner projects that materially influence
the substance of the Long Range Service Vision
In addition to the Summary Memo, Caltrain staff has released a presentation and
Organizational Assessment Report. These documents and additional information is
available at https://www.caltrain2040.org/long-range-service-vision/. Caltrain staff has
indicated they plan to present the Long Range Service Vision to the Joint Powers Board
for adoption at its October meeting, potentially on October 3rd.
Discussion
Through discussion at the Caltrain Local Policy Maker Group (LPMG) meetings, it
appears clear that while many communities would like to advance grade separation
projects, primary interests at this time focus on increased frequency and quality of
Caltrain service. This puts Palo Alto in a somewhat unique position of grappling with
the complex and difficult issues associated with grade separations ahead of many
communities along the Caltrain corridor. Caltrain has to date been actively involved
with grade separations in San Mateo County, largely funded through San Mateo County
Measure A. With Santa Clara County Measure B now providing funds for Caltrain grade
separations in Palo Alto, Mountain View, and Sunnyvale, the need and issues associated
with funding and organizational arrangements between Caltrain, VTA, and the cities are
now becoming acute.
In addition, the Service Vision analysis indicates that under either Moderate or High
Growth Scenarios the existing two-track railway must be expanded to four tracks in
northern Santa Clara County. The Moderate Growth Scenario describes the need for a
four track station in either Palo Alto or Mountain View, and the High Growth Scenario
describes the need for four tracks configured as either a four track station or a longer
City of Palo Alto Page 4
passing section in Palo Alto or Mountain View. Very little detail is available on the
physical requirements for four-track segments. Impacts in Palo Alto could therefore be
significant given the constrained right-of-way at the California Avenue Station and Alma
Street, as well as sensitive adjacent residential land uses.
Caltrain staff has indicated that their current position regarding the need to plan for
four tracks on ongoing grade separation planning is that grade separations “should not
preclude” future expansion to four tracks. The specific effect on grade separation plans
in Palo Alto will therefore likely develop over time, as depending on the timing of Palo
Alto’s grade separation decisions coincide with Caltrain’s decisions and next steps on its
service vision, funding strategies, and organizational evolution. There is the potential
that Caltrain may in the future take the position that its interest in a four-track segment
delays, precludes, or increases the cost of grade separations in Palo Alto.
These considerations raise the question of Palo Alto’s position regarding the Caltrain
Long Range Service Vision. Options for the City Council could range among the
following, as examples:
a. that Caltrain’s Long Range Service Vision must recognize that it is dependent on
grade separations acceptable to the affected communities;
b. that Caltrain must commit to addressing grade separations prior to adopting a
Long Range Service Vision; or,
c. that Caltrain must conduct a feasibility study of passing tracks in North Santa
Clara County before adopting a Long Range Service Vision.
As currently drafted, the Caltrain staff recommendation addresses grade separations
under point 1.E.v.5:
E. Delivery of these services will occur through the incremental development of corridor
projects and infrastructure to be further defined through individual planning process,
feasibility studies and community engagement. At this time, such infrastructure is
conceptually understood to include… v. Completion of key regional and state partner
projects including… 5. The substantial grade separation of the corridor as well as safety
upgrades to any remaining at-grade crossings, undertaken in a coordinated strategic
manner driven by the desires of individual local jurisdictions as well as legal
requirements associated with any proposed 4-track segments.
As this language essentially aligns with the second option “a” above, the City Council
may direct staff to communicate Palo Alto’s support for the Long Range Service Vision
as currently drafted. Staff would work with the Mayor and Councilmember Kou, Palo
Alto’s representative on the Caltrain Local Policy Maker Group (LPMG), to communicate
this position.
Alternatively, the City Council may consider advocating that Caltrain make a more direct
City of Palo Alto Page 5
commitment to grade separations as a part of the Long Range Service Vision. The
Caltrain staff recommendation suggests that next steps will be to consider the
organizational changes necessary to advance the Service Vision. In the near term,
these issues will likely be intertwined with decisions to seek voter approval for funding
of Caltrain operations as well as capital needs.
As a specific example of near-term issues, VTA has indicated it will not bond Measure B
funds for grade separations. This leaves cities with the prospect of taking on the
responsibility for bonding hundreds of millions of dollars or delaying project
implementation until tax proceeds accumulate. Council direction for a greater
commitment to grade separations could include Caltrain participation in the financing of
grade separation projects.
Based on the current state of grade separation planning in Palo Alto as well as these
regional issues, staff recommends that the City Council consider a position of general
support for the Caltrain Long Range Service Vision conditional on its commitment to
immediately initiate a feasibility study of four-track segments in North Santa Clara
County and exploration of participation in financing Measure B grade separation
projects.
Timeline, Resource Impact, Policy Implications
Caltrain staff has indicated plans to present the Long Range Service Vision for Caltrain
Board adoption in October. City Council direction on comments would enable Palo
Alto’s interests to be specifically considered during the Board’s deliberations.
Environmental Review
The submittal of comments on the Caltrain Business Plan is not a project as defined by
the California Environmental Quality Act (CEQA).
Attachments:
• Attachment A: Caltrain BP Service Vision Summary Memo
The following memo supplements the PowerPoint presentation provided to the Peninsula Corridor
Joint Powers Board at their August meeting. It provides a high level summary of the service planning
and business case analysis completed as part of the Caltrain Business Plan to date and explains the
importance of choosing a “Long Range Service Vision” at this stage in the planning process.
The memo then describes staff’s draft recommendation for the Long Range Service Vision and
explains why staff has recommended this specific vision relative to other options considered.
Finally, the memo includes a narrative description of the recommended Vision and a draft of the
precise language that the Board would be asked to consider for adoption in October, pending
revisions or changes based on input received from the Board and through outreach planned in
August and September.
The Caltrain Business Plan is an expansive planning process that has been ongoing for more than a
year. A major focus of the plan has been to develop analysis of different long range service options
for Caltrain and to weigh the costs, revenues, benefits and impacts of these options through a
detailed “Business Case” analysis. At this stage of the Business Plan process, Caltrain staff has
developed and evaluated three distinct “growth scenarios” that provide illustrative options for how
the Caltrain Service could grow by 2040. Based on this analysis, staff has now developed a single,
recommended “Long Range Service Vision” for consideration and potential adoption by the Board.
Choosing a “Long Range Service Vision” is an important milestone in the Business Plan process.
Having a clearly articulated goal for the quantity and type of service that the railroad aspires to
provide in the future will provide staff with the critical guidance needed to complete the Business
Plan. Once adopted, the Long Range Service Vision will create a framework that allows staff to
“work backwards” from 2040, developing analysis showing how the Vision can be phased, funded
and implemented over time. This analysis will be conducted in the fall of 2019 with a goal of
completing the Business Plan by early 2020.
A REGIONAL VISION BUILT ON REGIONAL INVESTMENTS
Selection of a Long Range Service Vision will also allow Caltrain staff to engage efficiently and
constructively in the development of other long range plans and projects throughout the region. This
is particularly important since the Caltrain corridor interfaces with many different local, state and
regional transportation systems and investments. While the Long Range Service Vision is
fundamentally focused on Caltrain, the Vision must account for and integrate a vast array of
transportation projects that have been planned by corridor cities and regional and state partner
agencies. Key projects that directly influence Caltrain’s corridor and long range service ambitions
include;
• California’s High Speed Rail System
• The Downtown Extension to the Salesforce Transit Center
• The rebuilding of Diridon Station in San Jose
• Multiple grade separation projects planned and contemplated by corridor cities
The Caltrain Business Plan and Caltrain’s Long Range Vision have been deliberately developed to
integrate and build on all of these projects. One of the goals of the 2040 Vision is to build a “big
tent” that shows how all of the investments currently being planned in the corridor can fit together
as part of a cohesive whole, with expanded Caltrain service further enhancing their value and
importance.
It is important to note at the outset, that these regional and partner projects also drive a significant
portion of the overall investment costs that are considered within the Long Range Service Vision.
Figure 1 shows the total set of capital investments that have been included in the “baseline” growth
scenario, broken down by major source.
Figure 1- Capital Investments Included in the “Baseline” 2040 Growth Scenario
All costs have been adjusted to 2018 dollars
The costs shown in Figure 1 total to $22.1 billion in 2018 dollars and are divided into three
categories;
• Caltrain Work Underway: Including electrification and other major capital projects that are
already in progress
• Investments Planned and Proposed by Caltrain Partners: Including major terminal projects
like the Downtown Extension (DTX) and Diridon Project as well as High Speed Rail
Investments and those grade separations that are already actively being planned by local
jurisdictions. While all of these projects are in active stages of planning, most are
substantially unfunded.
• New Caltrain Investments to Support the Baseline Growth Scenario: This category includes
the essential investments that the Caltrain believes will be needed by 2040 to support the
baseline level of blended service. Examples include additional electrified rolling stock (to
fully electrify the fleet and expand all consists to 8-car trains), level boarding, expanded
storage and maintenance facilities and additional grade crossing improvements. These
projects are not funded.
These costs have been used as the basis, or “baseline,” for looking at the incremental investment
that would then be required to achieve the higher levels of Caltrain service contemplated in the
“moderate” and “high” growth scenarios.
Much of the technical work of the Caltrain Business Plan over the past year has been focused on the
development and refinement of three illustrative “Growth Scenarios,” each representing a different
option for the kind of service that Caltrain could provide in 2040 given different levels of supporting
investment. The three scenarios include a “baseline” level of service (consistent with Caltrain’s prior
long range planning and the regional and partner projects discussed above) and two additional
scenarios that consider what it might look like if Caltrain were to further expand service (the
“moderate” and “high” growth scenarios).
Although illustrative, these growth scenarios where developed at a high level of detail through an
extensive service planning process (diagramed in Figure 2). Details of each of these scenarios are
shown in Figure 3 and can also been reviewed in the accompanying presentation and on the project
website, www.caltrain2040.org.
Figure 2 – Growth Scenario Development Process
Figure 3 – Growth Scenario Detail
The process to develop the different growth scenarios evaluated in the Caltrain Business Plan was
conducted in a highly transparent and collaborative manner. Throughout the development of the
Growth Scenarios, Caltrain staff have met on a monthly basis to share information and discuss
findings with a technical team of partner agency staff (the Project Partner Committee) as well as
with corridor local jurisdiction staff (the City and County Staff Group) and corridor elected officials
(the Local Policy Maker Group). Additionally, the project team has held quarterly stakeholder
meetings with a Stakeholder Advisory Group representing over 90 different organizations and has
held multiple rounds of one on one meetings with every city in the corridor. The team also
developed customized “booklets” for each city, showing the impacts and benefits of different growth
scenarios on their jurisdiction. All told, Caltrain staff have presented Business Plan materials at over
150 stakeholder meetings during the course of the last year.
The detailed illustrative growth scenarios developed through the service planning process were used
to model ridership, specify and estimate the costs of required capital investments, and to model
detailed operating costs. These outputs were then used as the basis for developing a “Business
Case” analysis of each scenario. The Business Case analysis is a structured framework that helps
analyze and weigh the costs and benefits of the different options. The analysis examines five areas,
each of which is presented in detail in the accompanying presentation and is discussed briefly in this
memo.
Figure 4 – Areas of the Business Case Analysis
SERVICE COMPARISION
The service comparison section of the business case looks at the key service, and service-related
qualities of the different scenarios and compares them on a head to head basis. The accompanying
presentation provides a detailed analysis. In general, the quality of service across the options as
measured by various metrics improves as the level of train service and investment increase.
Conversely, however, the increased service included in the “high growth” scenario requires the
construction of extensive 4-track segments in the corridor – complex infrastructure that has the
potential to drive significant community impacts. A detailed service comparison is provided in the
accompanying presentation and a summary table of key metrics is shown in Figure 5.
Figure 5 – Summary of Key Comparative Service Metrics
FINANCIAL ANALYSIS
Detailed capital cost estimates for each scenario, building incrementally off of the “baseline”
investments described previously were developed for the moderate and high growth scenarios.
Figure 6 shows the baseline investment described previously, profiled over time, with the
incremental additional investment required to achieve the “moderate” or “high” growth scenarios
shown as an additional increment.
Figure 6 – Total Capital Investment by Scenario
All costs have been adjusted to 2018 dollars
Figure 7 shows the projected 2040 annual operating and maintenance costs for each of the
scenarios (in 2018 dollars).
Figure 7 – Total Operating Costs by Scenario
Finally, Figure 8 shows the net present value of total operating costs and projected revenues
projected over the 2018-2070 period (the lifecycle timeframe of key investments included in each of
the scenarios) along with the average fare box recovery rate across that same period. Additional
financial analysis and metrics are reported in the accompanying presentation.
Figure 8 – Net Present Value of Total Operating Costs and Revenues by Scenario, 2018-2070
CALTRAIN ECONOMIC ANALYSIS
The Business Plan team also developed a series of analyses examining the economic impact of the
different growth scenarios on Caltrain riders. This analysis considers the various ways that
improved Caltrain service could directly benefit riders, monetizes these benefits and compares them
to costs. This analysis is done on a marginal basis against the baseline scenario meaning that
calculations are based on the incremental costs and benefits of the “moderate” or “high” growth
scenarios relative to the baseline. Costs included in the analysis have also been “allocated” meaning
that the overall costs of shared investments (eg projects that serve multiple purposes or benefit
multiple users beyond just Caltrain) have been proportioned so as to fairly weigh Caltrain “costs”
against Caltrain “benefits.” Calculations are performed for the period between 2040 and 2070, when
each growth scenario is assumed to be fully operational. Figure 9 shows directly calculated benefits
while Figure 10 shows the net present value of monetized benefits weighed against the value of
incremental, allocated costs.
Figure 9 –Estimated Incremental Economic Benefits to Caltrain Users Relative to Baseline, 2040-2070
Figure 10 – Net Present Value and Benefit / Cost Ratio of Caltrain User Benefits
Weighed Against Allocated Costs, 2040-2070
REGIONAL ANALYSIS
The Business Plan team also developed analysis and qualitative discussion of a number of “regional”
benefits that would result based on different levels of investment in the Caltrain system. These
benefits accrue to a general population and not just users of the system. These regional benefits are
described in detail in the accompanying presentation and are summarized in Figure 11 below
Figure 11 – Summary of Regional Benefits
FLEXIBILITY AND UNCERTAINTY
Finally, the Business Plan team considered the degree of flexibility and uncertainty inherent in the
growth scenarios examined. The detailed service plans developed in each scenario are “illustrative,”
not definitive and much work remains both within and beyond the Business Plan process to examine
specific service patterns and service levels at individual stations.
Additionally, all of the 2040 growth scenarios have been developed in a way that includes and
integrates regional projects like High Speed Rail, the Downtown Extension and the rebuilding of
Diridon Station. These projects are in various stages of planning and design but all currently lack
the funding. There is a great deal of potential uncertainty regarding the timeframe in which they will
be delivered and the final form they may ultimately take. Similarly, while larger regional visions for a
greatly expanded, integrated rail network are ongoing there is a tremendous amount of uncertainty
around how and when these concepts may ultimately manifest.
The issues of service flexibility and uncertainty around regional projects are particularly relevant in
the context of understanding where overtake infrastructure may be required. The location and
extent of required overtake infrastructure is highly sensitive to what service is being accommodated.
This especially true in the “High growth” scenario where the large volume of blended train traffic
creates a need for long overtakes used by multiple different operators. The “moderate” growth
scenario has over take infrastructure needs that are more modest and can be planned for more
discretely.
Finally, this section of the presentation also discusses a number a series of initial financial
sensitivity tests to understand how key business metrics associated with the different growth
scenarios may vary in response to changing conditions.
SUMMARY AND BASIS FOR RECCOMENDATION
Caltrain staff has developed a draft recommendation for the Long Range Service Vision. This
recommended Vision is described in detail below, but, as it relates to the options studied, the
recommendation is that Caltrain adopt and pursue a Vision compatible with the “moderate” growth
scenario while also taking a series of steps to plan for and not preclude the potential realization of
the “high growth” scenario.
The extensive analysis conducted during the Business Plan process has shown that there a strong
demand for expanded Caltrain service and the business case analysis conducted as part of the plan
has shown that there is a clear case, based in economic and regional benefits, for pursuing a Vision
that goes beyond the baseline levels of service previously contemplated. While the high growth
option generates the greatest ridership and expanded regional benefits, it also comes at a higher
cost and carries significantly higher levels of uncertainty and potential for community impacts.
Therefore, based on the assembled evidence, staff has developed a recommendation that would
direct Caltrain to pursue a service vision consistent with the “moderate” scenario while retaining the
ability to expand to a level consistent with the “high growth” scenario at such time as demand
warrants or the region has made the policy and funding commitments to pursue a larger, integrated
rail system.
DESCRIBING THE VISION
The Long-Range Service Vision for Caltrain provides a world class service that is tailored to the
future needs of our local communities, the region and the state. It responds to and integrates the
committed and planned investments in the Caltrain corridor to deliver the greatest value to the
public and region, while maintaining the flexibility to respond as local and regional needs develop.
The Key Features of the Service Vision Include:
• Fast and frequent all day (every day) service
• Total peak hour frequencies of 8 Caltrain trains per direction
• Faster, all day baby bullet service with express service every 15 minutes
• Significantly increased off-peak and weekend service levels
• User friendly, show up and go service with easy to understand schedules
• Increased Capacity
• Provides the capacity to triple today’s ridership, serving nearly 180,000 people a day
• Adding more than 5 freeway lanes worth of regional capacity
• Regional Connectivity
• End to end service- connecting Gilroy to downtown San Francisco (all day, both
ways)
• Comprehensive local service providing coverage to every community
• Regular service making transfers and connections easier and more predictable
Major Additional Benefits
The Vision will bring huge benefits beyond direct improvements to service. Once complete, the
Vision will deliver;
• 1.3 million hours of travel time savings for existing and new Caltrain riders every year as
compared to the baseline scenario
• 300 million vehicle miles not traveled every year as compared to the baseline scenario
• $40.8 billion in regional economic output created by ongoing capital and operating
investments
• By 2040 Caltrain service will add between $25 and $37 billion in property value premiums to
residential and office properties within 1 mile of stations. (This analysis is conservative and
excludes San Francisco as well as commercial, non-office properties for which estimates
could not be reliably developed)
• The Vision will result in a reduction of nearly 2 million metric tons of CO2 as well as other air
quality improvements
Ready to Grow with the Region
• The Vision has been designed to integrate and add value to the many local, regional and
state investments that are being planning in the Caltrain corridor. These include projects like
grade separations, major improvements to terminal infrastructure and stations in San
Francisco and San Jose, and the integration of the state’s high speed rail system.
• The vision also anticipates the ongoing role of Caltrain in a regional rail network that in
addition to high speed rail could include a new rail service in the Dumbarton corridor, a
second transbay crossing, service to the Monterey peninsula and ongoing improvements to
service on Capital Corridor and ACE.
• As part of the Business Plan process, staff evaluated how the service and infrastructure
contemplated in the recommended Vision could scale up to an even “higher” level of growth
that would allow for up to 16 trains per hour per direction and even greater regional
integration and further expansion of rail. At this time, there is still a great deal of uncertainty
around the future of regional rail and Caltrain does not feel that we can independently
recommend moving forward with a maximum growth approach given the high costs and
potential for extensive community impacts.
• Instead, we are recommending a “do not preclude” approach that would allow for this future
growth to proceed once key regional decisions and funding commitments are in place. In
practice, this would mean limiting the sale or encumbrance of certain JPB land, accounting
for the possibility of more trains when we do terminal and facility planning, and considering
the potential need for 4 tracks as certain grade separations are designed. At the same time,
Caltrain will actively participate in evolving regional conversations and will help the region
and the state evaluate the feasibility and benefits of an expanded and integrated rail
network. If the region is truly prepared to move forward with a full regional rail expansion
Caltrain will be ready.
Capital Costs
• Achieving the Vision will also be costly- the total range of all projects contemplated to
achieve the Vision from Gilroy to San Jose include up to $25 billion (this includes roughly
$2.5 billion of Caltrain investments already paid for and underway).
o The significant majority of this cost is driven by projects that are being planned by
corridor partners (DTX in San Francisco, grade separations all along the corridor, the
potential cost of the Diridon Station project, and HSR improvements- collectively
account for more than $16 billion of the total).
o The goal of the Vision is to help knit these projects together and to add value to all of
them by providing greatly improved Caltrain service. Direct Caltrain investments
contemplated (beyond the existing projects already underway) total to roughly $6.5
billion)
• New sources of funding will clearly be required to address this level of need- including to
even come close to achieving the baseline. The $22 million a year contributed by member
agencies to the capital budget is not going to be sufficient to do any of this.
Operating Costs
• Projected 2040 operating annual costs for the Vision are $373.1 million a year in current
dollars (compared to about $135 million in 2018). By way of comparison, achieving a
“baseline” level of growth would cost about $265 million a year in 2040
• Financial projections show that the efficiency of the system will remain high- we are
projecting an average farebox recovery ratio of 75% (holding today’s fare levels constant
with inflation). Nonetheless, the need for subsidy will grow as the size of the system
increases. Caltrain may need as much as $90 million a year in operating subsidy (compared
to the roughly $36 million in subsidy it receives today- $30 million of which come from local
member agencies). As the business plan continues we will be exploring ways to further
increase system efficiency and generate additional revenues that would offset the need for
direct subsidy. Nonetheless, new funding is clearly needed.
Incremental Improvements
• The Vision is not one project- it can be implemented incrementally over time with
improvements to service and capacity delivered along the way. During the remainder of the
Business Plan Caltrain will work to identify key incremental steps that can be delivered in the
near- and medium term timeframes.
• We don’t need to wait until 2040- the first major improvement in service is coming soon.
Electrification, in 2022 is the first step and will mark a substantial step forward towards the
realization of this vision with significant service improvements throughout the corridor.
CALTRAIN’S LONG RANGE SERVICE VISION – DRAFT LANGUAGE
The following is the specific, draft “Service Vision” language that the JPB would be asked to consider
for adoption in October. This language will be reviewed and revised based on input from the Board and
comments received through stakeholder and public outreach.
1) Caltrain’s Long Range Service Vision directs the railroad to plan for a substantially expanded
rail service that will address the local and regional mobility needs of the corridor while
supporting local economic development activities. When fully realized, this service will
provide;
A. A mixture of express and local Caltrain services operated in an evenly spaced, bi-
directional pattern
B. Minimum peak hour frequencies of;
• 8 trains per hour per direction on the JPB-owned corridor between Tamien
Station in San Jose and San Francisco, extended to Salesforce Transit Center
at such time as the Downtown Extension is completed
• 4 trains per hour per direction between Blossom Hill and Tamien Stations,
subject to the securing of necessary operating rights
• 2 trains per hour per direction between and Gilroy and Blossom Hill Stations,
subject to the securing of necessary operating rights
C. Off-peak and weekend frequencies of between 2 and 6 trains per hour per direction
north of Blossom Hill and hourly between Gilroy and Blossom Hill, with future
refinements to be based on realized demand
D. Accommodation of California High Speed Rail trains, in accordance with the terms of
existing and future blended system agreements between the JPB and the California
High Speed Rail Authority
E. Delivery of these services will occur through the incremental development of corridor
projects and infrastructure to be further defined through individual planning process,
feasibility studies and community engagement. At this time, such infrastructure is
conceptually understood to include;
i. Investments in rail systems including a new, high performance signal system
ii. Station modifications including platform lengthening, level boarding, and
investments in station access facilities and amenities to support growing
ridership and improve customer experience
iii. New and modified maintenance and storage facilities in the vicinity of both
terminals as well as the expansion of the electrified Caltrain fleet
iv. A series of short, 4-track stations and overtakes at various points throughout
the corridor
v. Completion of key regional and state partner projects including
1. The Downtown Extension to the Salesforce Transit Center
2. The reconstruction of Diridon Station and surrounding rail
infrastructure
3. The reconstruction and electrification of the rail corridor south of
Control Point Lick to the Gilroy Station
4. Additional improvements to allow for the operation of High Speed
Rail service between Gilroy and San Francisco
5. The substantial grade separation of the corridor as well as safety
upgrades to any remaining at-grade crossings, undertaken in a
coordinated strategic manner driven by the desires of individual local
jurisdictions as well as legal requirements associated with any
proposed 4-track segments.
2) Caltrain’s Long Range Service Vision further directs the railroad to continue its consideration
of a potential “higher” growth level of service in the context of major regional and state rail
planning. Specifically, the Long Range Service Vision directs the railroad to;
A. Work with regional and state partners to study and evaluate both the feasibility and
desirability of higher levels of service in the context of major regional and state rail
initiatives including planning related to the Dumbarton Rail Corridor, the 2nd Transbay
Crossing, the potential for expanded ACE and Capitol Corridor services, and ongoing
planning for the California High Speed Rail system.
B. To take certain actions to consider and, where feasible, not preclude such higher
levels of service as they specifically relate to;
i. The planning of rail terminals and related facilities
ii. The sale or permanent encumbrance of JPB land
iii. The design of grade separations in areas where 4-track segments may be
required
iv. The sizing of future maintenance facilities and storage yards
C. To return to the board with a recommendation regarding any formal expansion of the
Long Range Service Vision at such a time as clear regional and state policy and
funding commitments are in place and the feasibility of such an option on the
corridor has been confirmed
3) Finally, Caltrain’s Long Range Service Vision directs the railroad to periodically reaffirm the
Vision to ensure that it continues to provide relevant and useful guidance to the railroad.
Such reaffirmations should occur;
A. At a regular intervals of no less than 5 years
B. In response to significant changes to JPB or partner projects that materially
influence the substance of the Long Range Service Vision
CITY OF PALO ALTO OFFICE OF THE CITY CLERK
September 16, 2019
The Honorable City Council
Palo Alto, California
Designation of Voting Delegate and Alternate for the League of
California Cities Annual 2019 Conference, to be Held October 16-18,
2019 in Long Beach, CA
The City Council should designate Council Member DuBois, Council Member
Kniss, or Council Member Kou as the voting delegate, and the other two as
alternates, for the 2019 League of California Cities Annual Conference.
BACKGROUND:
The League’s 2019 Annual Conference is scheduled for October 16-18, 2019 in
Long Beach, CA. An important part of the Annual Conference is the Annual
Business Meeting scheduled for 12:30 p.m. on Friday, October 18, 2019 at the
Long Beach Convention Center. At this meeting, the League membership
considers and takes action on resolutions that establish League policy. The
resolutions will be agendized for Council consideration prior to the conference.
In order to vote at the Annual Business Meeting, the City Council must delegate
a voting delegate and could appoint up to two alternate voting delegates. At this
time Council Member DuBois, Council Member Kniss, and Council Member Kou
have been registered for the conference.
Attached please find correspondence received from the League of California
Cities.
ATTACHMENTS:
• Attachment A: League of Cities Voting Delegate (PDF)
Department Head: Beth Minor, City Clerk
Page 2
COUNCIL MEETING
September 16, 2019
0Received Before Meeting
CITY OF
PALO
ALTO
TO:
FROM:
DATE:
SUBJECT:
HONORABLE CITY COUNCIL
BETH MINOR, CITY CLERK
SEPTEMBER 16, 2019
AGENDA ITEM NUMBER 10-Designation of Voting Delegate and Alternate for
the League of California Cities Conference, to be held October 16-18, 2019 in
Long Beach, CA.
Council Member DuBois who was scheduled to attend the above conference has advised that
due to a work conflict he will be unable to attend, therefore, his name is withdrawn for
consideration as a voting or alternate delegate. Council Members Liz Kniss and Lydia Kou are
attending and should be considered for delegate designations.
Beth Minor
City Clerk
1 of 1
City of Palo Alto (ID # 10590)
City Council Staff Report
Report Type: Informational Report Meeting Date: 9/16/2019
City of Palo Alto Page 1
Summary Title: Proclamation Establishing September 13-22, 2019 as
Welcome Week in Palo Allto
Title: Proclamation Establishing September 13-22, 2019 as Welcome Week in
Palo Alto
From: City Manager
Lead Department: Community Services
See attached proclamation
Attachments:
Attachment A: Proclamation Establishing September 13-22, 2019 as Welcome Week
Proclamation
Establishing September 12-22, 2019 as Welcome Week
WHEREAS, Palo Alto’s success depends on making sure that all residents feel welcome here. New residents
are a vital part of our community — bringing fresh perspectives and new ideas, starting businesses, and contributing
to the vibrant diversity that we all value; and
WHEREAS, this week, we honor the spirit of unity that is bringing neighbors together across Palo Alto during
Welcome Week, an effort of Welcoming America, a nonprofit, nonpartisan national organization which believes that
all people, including immigrants, are valued contributors who are vital to the success of our communities and shared
future; and
WHEREAS, I invite all residents of Palo Alto to join this movement of communities nationwide by
renewing our commitment to our core American values and by acting in the spirit of welcoming. By working
together, we can achieve greater prosperity and deepen our community as the kind of place where diverse
people from around the world feel valued and welcome; and
WHEREAS, regardless of where we are born or what we look like, we are Palo Altans, united in our
efforts to build a stronger community. By recognizing the contributions that we all make to create a vibrant
culture and a growing economy, we make our community more prosperous and more inclusive to all who call it
home. Let us continue to come together to build a community where every resident can contribute their best;
and
WHEREAS, a local coalition including the Palo Alto Family YMCA, Palo Alto History Museum, Mid-
Peninsula Community Media Center, Palo Alto Art Center, Palo Alto City Library, Avenidas, Palo Alto Adult
School, Palo Alto Human Relations Commission, and interested citizens have planned a variety of events in
celebration of Welcome Week to be found at paloaltowelcomeweek.org; and
NOW, THEREFORE, I, Eric Filseth, the Mayor of the City of Palo Alto, do hereby proclaim September
13-22, 2019, as Welcome Week, and call upon the people of Palo Alto to unite and continue to build a stronger
community together.
Presented: September 16, 2019
______________________________
Eric Filseth
Mayor