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2019-10-21 City Council Agenda Packet
City Council 1 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. Monday, October 21, 2019 Special Meeting Council Chambers 5:00 PM 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. PUBLIC COMMENT Members of the public may speak to agendized items; up to three minutes per speaker, to be determined by the presiding officer. If you wish to address the Council on any issue that is on this agenda, please complete a speaker request card located on the table at the entrance to the Council Chambers, and deliver it to the City Clerk prior to 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. TIME ESTIMATES Time estimates are provided as part of the Council's effort to manage its time at Council meetings. Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Council reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting or to adapt to the participation of the public. To ensure participation in a particular item, we suggest arriving at the beginning of the meeting and remaining until the item is called. HEARINGS REQUIRED BY LAW Applicants and/or appellants may have up to ten minutes at the outset of the public discussion to make their remarks and up to three minutes for concluding remarks after other members of the public have spoken. Call to Order Closed Session 5:00-6:00 PM 1.CONFERENCE WITH CITY ATTORNEY Existing Litigation - 1 Matter Authority: Government Code Section 54956.9(d)(1) Eileen Staats v. City of Palo Alto Santa Clara County Superior Court, Case No. 1:15-cv-284956 1A. CONFERENCE WITH CITY ATTORNEY- ANTICIPATED LITIGATION Authority: Government Code Section 54956.9(d)(2) and (e)(1) Multiple Potential Cases, as Defendant – Potential Inclusion of Human Resources and Equal Employment Opportunity Matters in Scope of Police Auditing and Reporting Services Study Session 6:00-7:00 PM 2.Joint Study Session With the Human Relations Commission REVISED 2 October 21, 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 7:00-7:10 PM Oral Communications 7:10-7:25 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. Minutes Approval 7:25-7:30 PM 3.Approval of Action Minutes for the September 23 and October 7, 2019 Council Meetings Consent Calendar 7:30-7:35 PM Items will be voted on in one motion unless removed from the calendar by three Council Members. 4.Approval of Contract Number C20175282 With Anderson Pacific Engineering Construction, Inc., in the Total Amount of $2,029,000 to Construct the Secondary Clarifiers No. 4 and No. 6 Mechanisms Replacement Project at the Regional Water Quality Control Plant - Capital Improvement Program Project (WQ-19002); and Authorization for the City Manager to Negotiate and Execute Change Orders for a Total Not-to-Exceed $202,900 5.Approval of Amendment Number 2 to Contract Number C18171717 With Perkins+Will, Amending the Scope of Services, Extending the Term, and Increasing Maximum Compensation by $368,758 for a Total Not-to-Exceed Amount of $1,137,826; and Approval of a Budget Amendment in the General Fund 6.Approval of Amendment Number 1 to Contract Number C19173514 With SP Plus, to add $150,000 for Expansion of the Valet Parking Program to California Avenue Parking Facilities and a Total Not-to- Exceed Amount of $1,050,000 7.Approval of Fiscal Year 2019 Re-appropriation Requests to be Carried Forward Into Fiscal Year 2020, and Budget Amendments in Various Funds 8.Adoption of a Resolution Approving the Process for Executing Resource Adequacy Capacity Purchases and Sales; Approving Standard Form Resource Adequacy Confirmation Letters; and Delegating Authority to the City Manager to Execute Resource Adequacy Purchases and Sales Under Established Guidelines 9.Adoption of a Resolution Amending Utilities Rules and Regulations 2 (Description and Abbreviations), 3 (Description of Utility Services), 4 Q&A Q&A Q&A 3 October 21, 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. (Application of Service), 7 (Deposits), 8 (Access to Premises), 9 (Disconnection, Termination and Restoration of Service), 13 (Shortage of Supply and Interruption of Service), 15 (Metering), 16 (Line Extension), 18 (Utility Service and Facilities on Customer Premises), 20 (Special Electric Utility Regulations), 21 (Special Water Utility Regulations), 22 (Special Gas Utility Regulations), 23 (Special Wastewater Utility Regulations), 24 (Special Refuse Service Regulations), 25 (Special Storm and Surface Water Drainage Utility Regulations), and 29 (Net Energy Metering Service, Billing and Interconnection) Action Items Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. 7:35-9:00 PM 10.PUBLIC HEARING: Adoption of a Resolution Establishing a new Residential Preferential Parking (RPP) Program in the Old Palo Alto Neighborhood; Approval of Amendments to Contract Number C15156501 With SP Plus for Permit Processing With Increased Compensation of $6,000, and Contract Number C15156763 With Serco, Inc. for Parking Enforcement to add Services for the Old Palo Alto RPP District With Increased Compensation of $35,070.40; and Approval of a Budget Amendment in the Residential Parking Permit Fund State/Federal Legislation Update/Action Council Member Questions, Comments and Announcements Members of the public may not speak to the item(s) CLOSED SESSION 9:00-10:30 PM 11.CAO PUBLIC EMPLOYEE PERFORMANCE EVALUATION Title: City Attorney Authority: Government Code Section 54957 (b) Adjournment AMERICANS WITH DISABILITY ACT (ADA) Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance. 4 October 21, 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 Schedule of Meetings Schedule of Meetings Tentative Agenda Tentative Agenda Informational Report Follow-Up From the September 16, 2019 Study Session With the City's Federal Advocate Public Letters to Council October 14 Set 1 Set 2 October 21 Set 1 City of Palo Alto (ID # 10763) City Council Staff Report Report Type: Study Session Meeting Date: 10/21/2019 City of Palo Alto Page 1 Summary Title: Joint Study Session with the Human Relations Commssion Title: Joint Study Session With the Human Relations Commission From: City Manager Lead Department: Community Services Below are the topics of discussion for the joint study session with the Human Relations Commission. 1) 2018-19 Highlights and Accomplishments a. Human Services Resource Allocation Process (HSRAP) and Community Development Block Grant (CDBG) funding allocations b. Relationships with local nonprofits c. Community Forum & Civic Engagement Events 2) 2019-20 Mayor Focus Areas a. LGBTQ+ Inclusion b. Census 2020 c. Assessing local Human Services Needs d. Youth Vaping e. Homelessness 3) Council Feedback CITY OF PALO ALTO OFFICE OF THE CITY CLERK October 21, 2019 The Honorable City Council Attention: Finance Committee Palo Alto, California Approval of Action Minutes for the September 23 and October 7, 2019 Council Meetings Staff is requesting Council review and approve the attached Action Minutes. ATTACHMENTS: • Attachment A: 09-23-2019 DRAFT Action Minutes (PDF) • Attachment B: 10-07-2019 DRAFT Action Minutes (PDF) Department Head: Beth Minor, City Clerk Page 2 CITY OF PALO ALTO CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 5 Special Meeting September 23, 2019 The City Council of the City of Palo Alto met on this date in the Council Chambers at 5:02 P.M. Present: Cormack, DuBois; Filseth arrived at 5:05 P.M.; Fine arrived at 5:50 P.M.; Kniss, Kou, Tanaka Absent: Closed Session 1. CONFERENCE WITH CITY ATTORNEY-POTENTIAL LITIGATION THIS ITEM HAS BEEN REMOVED. 2. CONFERENCE WITH REAL PROPERTY NEGOTIATORS Authority: Government Code Section 54956.8 Property: Cubberley Conveyance Property and Leased Site, 4000 Middlefield Road, Palo Alto, CA Assessor’s Parcel Nos. 147-08-052 and 053 Agency Negotiators: Ed Shikada, Kristen O’Kane, Molly Stump, Terence Howzell, Kiely Nose, David Ramberg, and Sunny Tong Negotiating Parties: City of Palo Alto and Palo Alto Unified School District (PAUSD). MOTION: Council Member Cormack moved, seconded by Council Member DuBois to go into Closed Session. MOTION PASSED: 5-0 Filseth, Fine absent Council went into Closed Session at 5:03 P.M. Council returned from Closed Session at 6:12 P.M. Mayor Filseth announced no reportable action. Study Session 3. Study Session Regarding Recycled Water Expansion Opportunities and Potential Regional Treated Wastewater Transfer From the Regional Water Quality Control Plant (RWQCP) to Santa Clara Valley Water District. DRAFT ACTION MINUTES Page 2 of 5 City Council Meeting Draft Action Minutes: 09/23/2019 NO ACTION TAKEN. Minutes Approval 4. Approval of Action Minutes for the September 9, 2019 Council Meeting. MOTION: Mayor Filseth moved, seconded by Council Member Cormack to approve the Action Minutes for the September 9, 2019 Council Meeting. MOTION PASSED: 7-0 Consent Calendar Council Member Kniss advised she would not participate in Agenda Item Number 5 as she owns property that falls within the Williamson Act. MOTION: Council Member DuBois moved, seconded by Council Member Cormack to approve Agenda Item Numbers 5-7. 5. Review and Approval of the Annual Williamson Act Contract Renewals Within Palo Alto City Limits; and Find This Action Exempt From Review Under the California Environmental Quality Act (CEQA) Pursuant to Section 15317 (Open Space Contracts or Easements) of the CEQA Guidelines. 6. Approval of Amendment Number 1 to Contract Number C18169608 With Clean Harbors Environmental Services, Inc. to Allow Consumer Price Index Increases to all Rates on an Annual Basis for Household Hazardous Waste Management and Emergency Response Services. 7. Approval of Amendment Number 2 to Contract Number C15152204 With Questica Inc. for the City's Budgeting Software for Five Additional Years in a Not-to-Exceed Amount of $399,556. MOTION PASSED FOR AGENDA ITEM NUMBER 5: 6-0 Kniss not participating MOTION PASSED AGENDA ITEM NUMBERS 6-7: 7-0 Council took a break at 7:55 P.M. and returned at 8:20 P.M. Action Items 7A. Caltrain Business Plan - Direction to Staff Regarding Comments on the Draft Long Range Service Vision (Continued From September 16, 2019). DRAFT ACTION MINUTES Page 3 of 5 City Council Meeting Draft Action Minutes: 09/23/2019 MOTION: Vice Mayor Fine moved, seconded by Council Member Kniss to thank Caltrain for their continued work on their business plan and emphasize that grade separation up and down the corridor are the most critical problem to solve in order for the business plan to proceed. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to change the last word in the Motion from “proceed” to “succeed”. MOTION PASSED: 7-0 8. Colleagues' Memo From Council Members DuBois and Kou Regarding Affordable Housing Plan to Advance Housing Goals That Address Socio- economic Diversity and Affordability. MOTION: Council Member DuBois moved, seconded by Council Member Kou to direct Staff to prioritize exploring elements of the City’s affordable housing activities and accelerate bringing them to Planning and Transportation Commission and Council as each item is ready, including the following priorities contained in the Colleague’s Memo: A. Applying/implementing an inclusionary Below Market Rate (BMR) program for rental units (Palmer Fix) Evaluate and recommend inclusionary percentage in the range of 15-25 percent of the units in rental residential developments with over 5 units (make same as ownership) must be affordable. Consider specifying income level requirements as well (percentage at each income range) Based on state law, affordable rental units would remain affordable for at least 55 years; could come in phases if possible to implement Palmer Fix quickly; B. Increase development impact fees to $64 per square feet for commercial projects; explore leveraging recent nexus studies including Palo Alto’s and Santa Clara County’s study for the Stanford General Use Permit application to contain costs and time for an updated nexus study; C. Clarify/update our Ordinances to ensure that when density bonuses are applied to mixed use projects the bonus is focused on the housing portion to the extent legally permissible. Evaluate and recommend inclusionary percentage in the range of 20-25 percent of density bonus is applied to the project; D. Explore feasibility of in-lieu fees or off-site replacement if existing residential units are removed from the housing stock; DRAFT ACTION MINUTES Page 4 of 5 City Council Meeting Draft Action Minutes: 09/23/2019 E. Explore protections and regulations in low density zoning such as cottage cluster developments and existing duplexes in the R-1, R-2 RMD and commercial districts to preserve “missing middle housing” and preserve transitions between R1 and higher density; and F. Explore citywide protections and regulations to prevent existing housing to be converted to commercial/hotel use. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to amend the Motion Part A to state, “continue prioritizing the City’s work on the Palmer Fix.” INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to amend the Motion Part B to state, “Direct Staff to do a nexus study for commercial projects.” INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to amend the Motion Part C to state, “Direct Staff to transmit to Council an informational report on the state and local density bonus Ordinance.” INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to amend the Motion Part E to state, “Focus on the Housing Work Plan and Comprehensive Plan language related to low density zoning such as cottage cluster developments and existing duplexes in the R-1, R-2 RMD and commercial districts.” MOTION AS AMENDED RESTATED: Council Member DuBois moved, seconded by Council Member Kou to direct Staff to prioritize exploring elements of the City’s affordable housing activities and accelerate bringing them to Planning and Transportation Commission and Council as each item is ready, including the following priorities contained in the Colleague’s Memo: A. Continue prioritizing the City’s work on the Palmer Fix; B. Direct Staff to do a nexus study for commercial projects; C. Direct Staff to transmit to Council an informational report on the state and local density bonus Ordinance; D. Explore feasibility of in-lieu fees or off-site replacement if existing residential units are removed from the housing stock; E. Focus on the Housing Work Plan and Comprehensive Plan language related to low density zoning such as cottage cluster developments and existing duplexes in the R-1, R-2 RMD and commercial districts; and DRAFT ACTION MINUTES Page 5 of 5 City Council Meeting Draft Action Minutes: 09/23/2019 F. Explore citywide protections and regulations to prevent existing housing to be converted to commercial/hotel use. MOTION AS AMENDED PASSED: 7-0 State/Federal Legislation Update/Action None. Adjournment: The meeting was adjourned at 11:00 P.M. CITY OF PALO ALTO CITY COUNCIL DRAFT ACTION MINUTES Page 1 of 5 Special Meeting October 7, 2019 The City Council of the City of Palo Alto met on this date in the Council Chambers at 5:04 P.M. Present: Cormack, DuBois, Filseth, Fine, Kniss, Kou, Tanaka Absent: Study Session 1. Study Session With Stanford Research Park Transportation Management Association (TMA). NO ACTION TAKEN. The City Council took a break at 6:22 P.M. and returned at 6:30 P.M. Agenda Changes, Additions and Deletions Mayor Filseth announced Staff requested Agenda Item Number 11, “Adoption of a Resolution Approving an Updated Standard Form Master Renewable Energy Certificate (REC)…”, be continued to a date uncertain. Minutes Approval 2. Approval of Action Minutes for the September 16, 2019 Council Meeting. MOTION: Mayor Filseth moved, seconded by Vice Mayor Fine to approve the Action Minutes for the September 16, 2019 Council Meeting. MOTION PASSED: 7-0 Consent Calendar Council Member Cormack registered a no vote on Agenda Item Numbers 7 and 17. Council Member Tanaka registered a no vote on Agenda Item Numbers 3, 4, 7, and 14. Council Member Kou registered a no vote on Agenda Item Numbers 7 and 14. DRAFT ACTION MINUTES Page 2 of 5 City Council Meeting Draft Action Minutes: 10/07/2019 MOTION: Mayor Filseth moved, seconded by Council Member Kniss to approve Agenda Item Numbers 3-10, 12-17. 3. Approval of Contract Number C19173550 With Accela, Inc., for Five Additional Years for Annual Software Maintenance and Support Services for Accela Citizen Access and Accela Automation Online Permitting Programs for a Total Not-to-Exceed Amount of $791,344. 4. Approval of Contract Number C14151181 With SAP Public Services, Inc. for Licensing and Support for the Upgrade of the City’s SAP Enterprise Resource Planning (ERP) System for a One-time fee of $227,504 and an Annual Support Fee of $50,051; and Approval of Contract Number C20175911 With Labyrinth Solutions Inc. (LSI), for Upgrade, Migration, Online Hosting and Support Services, and As-needed Technical/Functional Support Services, for the Upgrade of the City’s SAP ERP System in an Amount Not-to-Exceed $2,585,000. 5. Approval of Contract Number C19173686 With Open Cities for Five Years for the Next Generation City Website in the Amount of $267,200. 6. Resolution 9859 Entitled, “Resolution of the Council of the City of Palo Alto Establishing the Southgate Residential Preferential Parking (RPP) Program as a Continuing Program With Modifications, Including Increasing the Number of Employee Parking Permits and Limiting the Number of Daily Parking Permits Available to Employees.” 7. Approval of an Exemption From Competitive Solicitation and Approval of Contract Number C20176858 With Sandis Civil Engineers for a Maximum Not-to-Exceed Amount of $121,000 for Design Services Related to the Churchill Avenue Enhanced Bikeway Project (PL-14000). 8. Approval of the Electric Overhead Construction Services Contract Number C20172366A With Hot Line Construction, Inc. for a Total Not- to-Exceed Amount of $4,500,000 Over Three Years. 9. Approval of a Purchase Order With National Auto Fleet Group in an Amount Not-to-Exceed $576,745 for the Purchase of two 2019 Chevrolet G4500 Type III Ambulances, Utilizing a Cooperative Purchase Agreement, Funded Under Capital Improvement Program Project (VR- 19000). 10. Approval of Amendment Number 1 to Contract Number C15152971 With Contract Sweeping Services, Inc. for Street Sweeping Services, in Order to Extend the Term by six Months (Through April 24, 2020) and Increase DRAFT ACTION MINUTES Page 3 of 5 City Council Meeting Draft Action Minutes: 10/07/2019 the Rate Schedule by the Applicable Consumer Price Index (CPI) During the Additional six Months. 11. Adoption of a Resolution Approving an Updated Standard Form Master Renewable Energy Certificate (REC) Purchase and Sale Agreement, Approving Master REC Agreements With Three Counterparties, and Modifying the Approval Process for Future Individual REC Master Agreements, Thus Amending Section 2 and Recital J of Resolution Number 9652. 12. Approval of a Five-year General Services Agreement With Universal Semiconductor Inc. d/b/a Universal Security Company in the Amount of $472,282 for Security Guard Services at the Municipal Services Center (MSC). 13. Approval of a Purchase Order With National Auto Fleet Group in an Amount Not-to-Exceed $379,429 for the Purchase of a 2020 Peterbilt 337 Cable Puller With Crane, Utilizing a Cooperative Purchase Agreement. 14. Approval of Amendment Number 1 to Contract Number C18168707 With Metropolitan Planning Group to Increase Compensation by $250,000 for a Total Not-to-Exceed Amount of $750,000 for the Existing Three-year Contract Supporting Planning Review; and Finding This Project Exempt From Environmental Review in Accordance With Section 15061 of the California Environmental Quality Act (CEQA) Guidelines. 15. Approval of Contract Number C20176719 With Alex Kushner General Inc. in the Amount of $614,909 for the Animal Shelter Renovation Capital Improvement Program Project (PE-19002). 16. Approval of Amendment Number 1 to Contract Number S18165157 With Smart Energy Systems, LLC., d/b/a SEW for Professional Services for the new Utilities Customer Portal, to add an Additional $215,500 and Extend the Contract Term for two Additional Years, for the Total Not-to- Exceed Amount of $346,123 Over the Five-year Term. 17. Direction to Staff to Negotiate an Agreement With Palo Alto Unified School District to Continue Leasing Cubberley Community Center for an Additional Five Years With Additional Terms as Provided in a Draft Term Sheet Negotiated by the Parties. MOTION PASSED FOR AGENDA ITEM NUMBER 3: 6-1 Tanaka no MOTION PASSED FOR AGENDA ITEM NUMBER 4: 6-1 Tanaka no DRAFT ACTION MINUTES Page 4 of 5 City Council Meeting Draft Action Minutes: 10/07/2019 MOTION PASSED FOR AGENDA ITEM NUMBERS 5-6, 8-10, 12-13, 15- 16: 7-0 MOTION PASSED FOR AGENDA ITEM NUMBER 7: 4-3 Cormack, Kou, Tanaka no MOTION PASSED FOR AGENDA ITEM NUMBER 14: 5-2 Kou, Tanaka no MOTION PASSED FOR AGENDA ITEM NUMBER 17: 6-1 Cormack no Action Items 18. Approval of the 2019 Workplan to Address the Council Priority “Transportation and Traffic.” MOTION: Council Member Cormack moved, seconded by Mayor Filseth to approve the 2019 Workplan to address the Council Priority “Transportation and Traffic.” MOTION PASSED: 6-0 Kniss absent 19. Approval of the Recommended City Positions for the 2019 League of California Cities Resolutions. MOTION: Vice Mayor Fine moved, seconded by Council Member XX to direct the Council appointed voting delegate to abstain on the two resolutions up for consideration at the annual League of California Cities (LOCC) conference to be held in Long Beach, CA from October 16-18, 2019. MOTION FAILED DUE TO THE LACK OF A SECOND MOTION: Mayor Filseth moved, seconded by Council Member Kou to direct the Council appointed voting delegate to support the two resolutions up for consideration at the annual League of California Cities (LOCC) conference to be held in Long Beach, CA from October 16-18, 2019. SUBSTITUTE MOTION: Council Member Cormack moved, seconded by Vice Mayor Fine to direct the Council appointed voting delegate to abstain from Resolution 1 and support Resolution 2 up for consideration at the annual League of California Cities (LOCC) conference to be held in Long Beach, CA from October 16-18, 2019. SUBSTITUTE MOTION PASSED: 6-1 Kou no DRAFT ACTION MINUTES Page 5 of 5 City Council Meeting Draft Action Minutes: 10/07/2019 Closed Session 20. PUBLIC EMPLOYEE PERFORMANCE EVALUATION Title: City Manager Authority: Government Code Section 54957 (b) MOTION: Mayor Filseth moved, seconded by Council Member Kniss to go into Closed Session. MOTION PASSED: 7-0 Council went into Closed Session at 8:29 P.M. Council returned from Closed Session at 10:20 P.M. Mayor Filseth announced no reportable action. Adjournment: The meeting was adjourned at 10:21 P.M. City of Palo Alto (ID # 10597) City Council Staff Report Report Type: Consent Calendar Meeting Date: 10/21/2019 City of Palo Alto Page 1 Summary Title: Award of Contract for Mechanisms Replacement of Secondary Clarifiers No. 4 & 6 at RWQCP Title: Approval of Contract Number C20175282 With Anderson Pacific Engineering Construction, Inc., in the Total Amount of $2,029,000 to Construct the Secondary Clarifiers No. 4 and No. 6 Mechanisms Replacement Project at the Regional Water Quality Control Plant - Capital Improvement Program Project (WQ-19002); and Authorization for the City Manager to Negotiate and Execute Change Orders Not-to-Exceed $202,900 From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council: 1. Approve and authorize the City Manager or his designee to execute the contract with Anderson Pacific Engineering Construction, Inc., (Attachment A) in the amount of $2,029,000 for the Secondary Clarifiers No. 4 and No. 6 Mechanisms Replacement Project, funded in Wastewater Treatment Enterprise Fund Capital Improvement Program, Project WQ-19002, at the Regional Water Quality Control Plant; and 2. Authorize the City Manager or his designee to execute one or more change orders to the contract with Anderson Pacific Engineering Construction, Inc. for related, additional but unforeseen work that may develop during the project, the total value of which may not exceed $202,900. Background The Regional Water Quality Control Plant (Plant) treats an average of 19 million gallons of wastewater each day. Secondary clarifiers are a vital part of the treatment process, removing sludge from wastewater before it is treated further and discharged into the San Francisco Bay. The Plant has six clarifiers, two of which are kept empty in standby mode so that they are readily available during events of unexpected equipment failure, routine equipment downtime for maintenance, or during high flows. City of Palo Alto Page 2 Clarifiers No. 1 through No. 4 were constructed in 1972. Clarifiers No. 5 and No. 6 were added in 1988. The rotating mechanisms of Clarifiers No. 1, No. 2, No. 3 and No. 5 were replaced between 2008 and 2018. The rotating mechanisms of Clarifiers No. 4 and No. 6 are original units and are operating beyond their useful lives. As discussed in the 2012 Long Range Facilities Plan and as observed in the field, the original clarifier mechanisms are showing signs of deterioration including corrosion on structural steel beams and access platforms. The isolation slide gates at the clarifier effluent and bypass channels are corroded and not operable. The coatings on the existing return activated sludge pipes are failing, exposing the cast iron pipes to additional corrosion. The interior walls and effluent troughs of the clarifier tanks have some cracks and exposed rebar that need to be repaired. Replacing the aging clarifier mechanisms and rehabilitating their ancillary systems will improve the reliability of the clarifier units. Discussion The work to be performed under this contract includes installing new rotating mechanisms and ancillary components for Clarifiers No. 4 and No. 6; replacing corroded return activated sludge pipes and slide gates; and repairing spalling concrete and cracks on the tanks’ walls and effluent troughs. Bid Process On July 15, 2019, the City solicited formal bids from qualified contractors for the Clarifiers No. 4 and No. 6 Mechanisms Replacement Project. The bidding period was 23 days. On August 6, 2019, bids were received from two qualified contractors as presented in the bid summary (Attachment B). Summary of Bid Process Bid Name/Number Clarifiers No. 4 & 6 Mechanisms Replacement Project (IFB-175282) Proposed Length of Project 14 months after Notice to Proceed Number of Bid Packages downloaded by Contractors 7 Number of Bid Packages downloaded by Builder’s Exchanges 33 Total Days to Respond to Bid 23 Pre-Bid Meeting Yes Number of Company Attendees at Pre-Bid Meeting 9 Number of Bids Received: 2 Base Bid Price Range $1,997,000 to $2,474,800 Staff has reviewed all bids submitted and recommends the bid of $2,029,000 (including additive alternate and deductive alternate bid items) submitted by Anderson Pacific Engineering Construction, Inc., be accepted and Anderson Pacific Engineering Construction, Inc., be declared City of Palo Alto Page 3 the lowest responsible bidder. The base bid is 19.1% above the engineer's estimate of $1,677,000, which was prepared earlier this year before tariffs on aluminum and steel were enforced. The bid pricing is reflective of the current construction market environment, which is favorable to contractors. A contingency amount of $202,900 (10% of the contract) is requested for related, additional but unforeseen work that may develop during the project. Staff confirmed with the Contractor's State License Board that the contractor has an active license on file. Timeline The work is anticipated to be complete by December 2020. Resource Impact Funding for this contract is included in the Fiscal Year 2020 Wastewater Treatment Enterprise Fund Capital Improvement Program, Plant Repair, Retrofit, and Equipment Replacement Project (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: Attachment A - Contract C20175282 Anderson Pacific Engineering Attachment B - Bid Summary for Clarifiers No.4 & No.6 Mechanisms Replacement Project Invitation for Bid (IFB) Package 1 Rev. March 17, 2017 CONSTRUCTION CONTRACT CONSTRUCTION CONTRACT Contract No. C20175282 City of Palo Alto Clarifiers 4 & 6 Mechanisms Replacement Project Invitation for Bid (IFB) Package 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 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……………………………………………………………………………………………..9 8.1 Standard of Care…………………………………………………………………………………..…………………9 SECTION 9 INDEMNIFICATION…………………………………………………………………………………………..…10 9.1 Hold Harmless……………………………………………………………………………………………………….10 9.2 Survival…………………………………………………………………………………………………………………10 SECTION 10 NON-DISCRIMINATION……..………………………………………………………………………………10 10.1 Municipal Code Requirement…………….………………………………..……………………………….10 SECTION 11 INSURANCE AND BONDS.…………………………………………………………………………………10 Invitation for Bid (IFB) Package 3 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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…………………………………………………………………………………14 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 16.1 Contractor’s Remedies……………………………………..………………………………..………………….16 Invitation for Bid (IFB) Package 4 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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 SECTION 30 STATUTORY AND REGULATORY REFERENCES …………………………………………………..19 Invitation for Bid (IFB) Package 5 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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 Invitation for Bid (IFB) Package 6 Rev. March 17, 2017 CONSTRUCTION CONTRACT CONSTRUCTION CONTRACT THIS CONSTRUCTION CONTRACT entered into on October 21, 2019 (“Execution Date”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("City"), and Anderson Pacific Engineering Construction, Inc ("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 245215 and Department of Industrial Relations Registration Number 1000000061. 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 July 15, 2019, City issued an Invitation for Bids (IFB) to contractors for the Clarifiers No. 4 & 6 Mechanisms Replacement (“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 Clarifiers No. 4 & 6 Mechanisms Replacement Project, located at Regional Water Quality Control Plant, 2501 Embarcadero Way, Palo Alto, CA. 94303 ("Project"). Invitation for Bid (IFB) Package 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) Bidding Addenda 5) Special Provisions 6) 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 shall have the sole power to decide which document or provision shall govern as may be in the best interests of the City. Invitation for Bid (IFB) Package 8 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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. 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. 6.3 Contract Time. Work hereunder shall begin on the date specified on the City’s Notice to Proceed and shall be completed not later than. within 411 calendar days after the Execution Date of the Contract. By executing this Construction Contract, Contractor expressly waives any claim for delayed early completion. 6.4 Liquidated Damages. Pursuant to Government Code Section 53069.85, if Contractor fails to achieve Substantial Completion of the entire Work within 361 calendar days of the Execution Date of the Contract, 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 Five Hundred dollars ($500) 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 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 Invitation for Bid (IFB) Package 9 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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 361 calendar days of the Execution Date of the Contract. 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 Contract Sum. Contractor shall be compensated for satisfactory completion of the Work in compliance with the Contract Documents the Contract Sum of Two Million Twenty-Nine Thousand Dollars ($2,029,000). [This amount includes the Base Bid; Additive Alternates 2, 3 and 4; and Deductive Alternate 1.] 7.2 Full Compensation. The Contract Sum 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 Contract Sum may only be adjusted for Change Orders approved in accordance with the requirements of the Contract Documents. 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. Invitation for Bid (IFB) Package 10 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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. 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. Invitation for Bid (IFB) Package 11 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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 Copy to: City of Palo Alto Public Works Administration 250 Hamilton Avenue Palo Alto, CA 94301 Attn: Siew Ching Chin AND [Include Construction Manager, If Applicable.] Invitation for Bid (IFB) Package 12 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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: Anderson Pacific Engineering Construction, Inc. Attn: Peter Anderson 1390 Norman Avenue Santa Clara, CA 95054 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. 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. Invitation for Bid (IFB) Package 13 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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. 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 Invitation for Bid (IFB) Package 14 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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. 15.5 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. Invitation for Bid (IFB) Package 15 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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; (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. Invitation for Bid (IFB) Package 16 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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. Invitation for Bid (IFB) Package 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. Invitation for Bid (IFB) Package 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 Invitation for Bid (IFB) Package 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: Invitation for Bid (IFB) Package 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. Invitation for Bid (IFB) Package 21 Rev. March 17, 2017 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 ____________________________ Purchasing Manager City Manager or Designee APPROVED AS TO FORM: ____________________________ City Attorney or designee APPROVED: ____________________________ Public Works Director Anderson Pacific Engineering Construction, Inc. Officer 1 By:___________________________ Name:________________________ Title:__________________________ Date: _________________________ Officer 2 By:____________________________ Name:_________________________ Title:___________________________ Date:____________________________ Bid Item Description Engineer's Estimate Anderson Pacific Engineering Construction, Inc. Monterey Mechanical Base Bid Replacement of the rotating mechanisms for Clarifiers No. 4 and No.6; return activated sludge piping; slide gates and ancillary systems. Minor repairs on the clarifier tanks' walls. $1,677,000 $1,997,000 $2,474,800 Additive Alternate Bid Perform non‐destructive testing on the existing mechanism center column's anchor bolts. Replace the anchor bolts as‐ needed and perform necessary modifications to the center column's concrete foundation block. $100,000 $50,000 $230,000 Deductive Alternate Bid Delete the replacement of two existing 20” elbows inside the pipe gallery and associated pipe‐wall penetration work on the wall between Clarifier No.4 and the pipe gallery. ‐$25,000 ‐$18,000 ‐$29,500 $1,752,000 $2,029,000 $2,675,300 Apparent low bidder Highest bidderRemarks: Attachment B City of Palo Alto, Public Works Department ‐ RWQCP CIP WQ‐19002 Facility Equipment Replacement Bid Summary for Clarifiers Nos.4 & 6 Mechanisms Replacement (IFB‐175282) Total Bid: City of Palo Alto (ID # 10599) City Council Staff Report Report Type: Consent Calendar Meeting Date: 10/21/2019 City of Palo Alto Page 1 Summary Title: NVCAP: Perkins+Will Contract Title: Approval of Amendment Number 2 to Contract Number C18171717 With Perkins+Will Amending the Scope of Services, Extending the Term, and Increasing Maximum Compensation by $368,758 for a Total Not-to-Exceed Amount of $1,137,826; and Approval of a Budget Amendment in the General Fund From: City Manager Lead Department: Planning and Development Services Recommendation Staff recommends that Council: 1. Approve and authorize the City Manager or his designee to execute Amendment No. 2 to Contract C18171717 with Perkins + Will (Attachment A), amending the scope of services, increasing maximum compensation in the amount of $368,758 for a total not to exceed amount of $1,137,826, and extending the term one additional year through December 31, 2021; and 2. Amend the Fiscal Year 2020 Adopted Operating Budget to: a. Increase the Planning and Development Services contracts budget by $368,758 b. Decrease the Budget Stabilization Reserve by $368,758 Executive Summary On August 19, 2019, City Council directed staff to return with an amendment to Contract C18171717 with Perkins+Will. The amendment is to increase the scope, budget and timeline for the North Ventura Coordinated Area Plan (NVCAP). The proposed amendment would increase the budget by $368,758, for a total contract amount not to exceed $1,137,826. The amendment would also: • Extend the contract timeframe to December 31, 2021 or an increase of one year • Amplify the analysis to include three project alternatives City of Palo Alto Page 2 • Enable longer Working Group meetings and additional analyses per Council direction Background The City Council initiated the coordinated area plan process on November 6, 2017 for the North Ventura area. On June 25, 2018, City Council authorized the original contract to be executed with Perkins+Will for professional services to develop the NVCAP. The amount of the contract, including all sub-consultants, was set at ‘not to exceed’ $769,068. Funding for this work was provided through a federal grant administered by the California Department of Transportation and supported by matching funds from the Sobrato Organization, the owner of property located within the project area. In August 2018, a contract amendment incorporated minor changes with language clarifying that the City would require the consultant to comply with federal regulations for consulting work. 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. These included: • Inclusionary and workforce housing; • Prevention of residential displacement; • Limiting the amount and size of future office spaces. At that time, the Council also expressed interest in exploring design options integrating Matadero Creek as an open space feature and enhancing its connection to Boulware Park. On August 19, 2019, Council directed staff to return with a contract amendment to expand the project scope, increase the budget, and extend the NVCAP project timeline. The City Council also directed staff to return with a separate consultant contract to study improvements to Matadero Creek. The City Council considered and approved the latter contract with WRA Inc. on September 16, 2019. Discussion On August 19, 2019, the City Council directed staff to return with a contract amendment to accommodate an expanded scope, extended timeline, and increased budget (see August 19th staff report: https://bit.ly/2lEA9SL). The expanded scope includes: • Economic Value of NVCAP • Evaluation of Proposed Policies • Additional Alternative (for a total of three additional analyses, incorporating the creek study and historic study) City of Palo Alto Page 3 • Parking Model Calibration • Increase Working Group meeting from 2 hours to 3 hours per meeting • Additional Decision-Maker Meetings (5 additional meetings) • Expanded CEQA review options to include possible Environmental Impact Report • Financial Analysis • Project Management Extension including Coordination between Consultant and City Staff The original contract timeline was for 18 months and the contract would have expired December 31, 2020. Due to the added scope, the project timeline is proposed to extend to the third quarter of 2021, adding approximately a year to the overall timeline. This extended timeline would accommodate longer Working Group meetings and the additional analysis for both the creek and the historic site at 340 Portage Ave/3201-3225 Ash Street. With the proposed amendment, the contract would expire on December 31, 2021. The budget for the project has increased by $368,758, which will raise the budget for basic services to a not to exceed amount of $1,034,388. An amount of $103,438, or ten percent of the basic services cost, is also included in the budget for additional services, for tasks such as additional public hearings. The total cost of the contract, including additional services if agreed to by the City, would not exceed $1,137,826. The City is funding separately the creek and historic analyses. These funds are also already provided for in the current fiscal year department budget. Resource Impact A $638,000 federal grant provides funding for the majority of this Contract. The Sobrato Organization, the owner of 340 Portage Ave., provided $112,000 (the required 11.47% matching funds) plus $138,000 to pay for the required environmental analysis. The contract staff proposed to amend is a portion of the anticipated project expense. Other expenses such as City staff time are not included in the contract. To pay for the additional scope of services, staff requests a budget amendment of $368,758 from the Budget Stabilization Reserve. Based on estimates through May 2019, the FY 2020 Budget included a contribution to the Budget Stabilization Reserve to ensure it met City Council’s target level of 18.5% of General Fund Expenses. The action recommended in this report will decrease the Budget Stabilization Reserve by $368,758 which is anticipated to bring Budget Stabilization Reserve to approximately $100,000, or 0.005%, below the City Council’s target. However, staff is currently in the process of completing the year-end analysis of FY 2019 through the Comprehensive Annual Financial City of Palo Alto Page 4 Report (CAFR) and it is anticipated that sufficient savings will be identified to ensure that the Budget Stabilization Reserve remains at City Council’s target of 18.5%. As directed by Council on August 19, staff began discussions about voluntary funding contributions with other large landowners within the project boundary. Any funds the City receives from these owners would not convey any entitlement or guarantee future development. These properties represent parcels of land that are more likely to redevelop or can support more development. After discussing this opportunity with property owners, staff will return to the City Council to report on the outcome of the conversations. Environmental Review Approval of the contract amendment with Perkins+Will is exempt from the California Environmental Quality Act (CEQA). CEQA Guidelines section 15306 (Class 6) exempts information collection, research, and resource evaluation from environmental review. The resultant coordinated area plan will include the preparation of an environmental analysis consistent with the requirements of CEQA. Attachments: Attachment A - Perkins + Will Revised Contract (PDF) DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 1 of 30 AMENDMENT NO. 2 TO CONTRACT NO. C18171717 BETWEEN THE CITY OF PALO ALTO AND PERKINS + WILL This Amendment No. 2 ( “Amendment”) to Contract No. C18171717 ( “Contract”) is entered into as of October 7, 2019, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and PERKINS + WILL, a Delaware corporation, located at 2 Bryant Street, Suite 300, San Francisco, CA 94105 (“CONSULTANT”). CITY and CONSULTANT are collectively referred to as “Parties” in this Amendment. R E C I T A L S A. The Contract was entered into between the Parties for the provision of services to facilitate and complete a planning process and prepare a Coordinated Area Plan for the North Ventura area to guide the development of a walkable, mixed-use neighborhood with multifamily housing, commercial services, well-defined connections to transit, bicycle and pedestrian facilities, urban design strategies, and design guidelines to strengthen and support the neighborhood fabric and connections to transit, pedestrian, and bicycle facilities (“Project”). B. Section 27.4 of the Contract authorizes the Parties to modify the Contract by written amendment. C. The Parties now wish to amend the Contract in order to extend the term, amend the scope of services to incorporate additional services, extend the project timeline, and to respond to City Council direction as specified in EXHIBIT “A” attached hereto, and to increase the maximum total compensation by $368,758.00 from $769,068.00 to $1,137,826.00. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree: SECTION 1. Definitions. The following definitions shall apply to this Amendment: a. Contract. The term “Contract” shall mean Contract No. C18171717 between CONSULTANT and CITY, dated June 25th, 2018, as amended by: Amendment No.1, dated December 19th, 2018. b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract. SECTION 2. Section 2. TERM of the Contract is hereby amended to read as follows: DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 2 of 30 “ SECT I O N 2. T ERM . The term of this Agreement shall be from the date of its full execution through December 31, 2021, unless terminated earlier pursuant to Section 19 of this Agreement.” SECTION 3. Section 4. NOT TO EXCEED COMPENSATION of the Contract is hereby amended to read as follows: “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 One Million Thirty-Four Thousand Three Hundred Eighty-Eight Dollars ($1,034,388.00). CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount. In the event Additional Services are authorized, the total compensation for Basic Services, Additional Services and reimbursable expenses shall not exceed One Million One Hundred Thirty- Seven Thousand Eight Hundred Twenty-Six Dollars ($1,137,826.00). 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”. 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 4. The following exhibits to the Contract are hereby amended and replaced in their entirety to read as set forth in the attachment(s) to this Amendment, which are hereby incorporated in full into this Amendment and into the Contract by this reference: a. Exhibit “A” entitled “SCOPE OF SERVICES b. Exhibit “C” entitled “COMPENSATION” SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect. DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 3 of 30 SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference. (SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.) DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 4 of 30 SIGNATURES OF THE PARTIES IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Amendment effective as of the date first above written. CITY OF PALO ALTO PERKINS + WILL City Manager APPROVED AS TO FORM: City Attorney or designee By: Name: Title: Geeti Silwal Principal Attachments: EXHIBIT "A": SCOPE OF SERVICES EXHIBIT "C": COMPENSATION DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 5 of 30 EXHIBIT “A” SCOPE OF SERVICES CONSULTANT shall perform the tasks and services set forth in this Scope of Services. Task 1 Project Initiation and Management Task 1.1 Project Management and Oversight CONSULTANT will provide project management and oversight for all tasks detailed in this scope of services for the duration of the Agreement. CONSULTANT’S project management activities will consist of, but are not limited to: • Refine the work program in consultation with CITY to accomplish the principal activities under this Scope of Services and refine a timeline for completing the work with milestones and deliverables consistent with the schedule in Exhibit B “Schedule of Performance” • Regularly update the work plan and timeline to reflect actual progress • Review the proposed community engagement tools and engagement strategy • Outline project goals and objectives • Identify engagement activities • Identify target demographic and interest groups and identify methods of communication and engagement • Confirm coordination, facilitation and communication responsibilities • Outline schedule, format and resources for all engagement activities • Provide overall management of CONSULTANT team, including sub consultants • Provide oversight of budget, scope, schedule, deliverables and QA/QC • Prepare and submit a monthly invoice by task and percentage of completion that details work performed by the CONSULTANT team and identifies expense charges. Invoiced tasks related to CEQA review shall include a notation on the invoice identifying them as “CEQA review”. • Weekly calls between CONSULTANT project manager and CITY from October 1, 2019 through June 2020. 1.1 Interim work products • Refined work program • Refined project schedule DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 6 of 30 • Monthly invoices • Community engagement strategy Task 1.1 A Style Guide and Project Logo An important first step in creating project materials will include the preparation of an identifiable brand to apply to all print and digital publications in the community engagement effort. This exercise will ensure that all materials adhere to a graphic style that community members can easily associate with the project. CONSULTANT shall create a project logo and style guide, with fonts, color schemes and other design elements. 1.1 Deliverable • Project logo and style guide, with fonts, color schemes and other design elements Task 1.2 Progress Meetings CONSULTANT will facilitate regular progress meetings (these may be conference calls or in- person, depending on agenda items) with City Staff to coordinate and report on contract matters, project progress, upcoming events and deliverables. CONSULTANT and City staff will jointly organize a kickoff meeting at the outset of the Agreement. This kickoff meeting will be for 4 hours and during this meeting the CONSULTANT team will meet with the City’s project manager to establish appropriate project protocols and tour the site prior to immersing itself in the background conditions information. At the kick-off meeting, CONSULTANT shall create consensus around key design and planning principles that set the foundation for the entire project and establish goals and performance targets for the project. CONSULTANT assumes weekly progress phone calls or video conferences between August 2018 and June 2020 while the design alternatives are being developed and through completion of the draft Administrative Plan; these calls are suspended for the summer of 2019 and will resume October 1, 2019. Upon delivery of the draft Administrative Plan to City staff at the end of June 2020, progress meetings/check-in will commence on an as-needed basis to prepare for Working Group/ Decision Maker meetings as defined in Task 2.4 below and Final Plan Adoption. 1.2 Interim work products • Meeting agendas • Meeting action items Task 2 Community Engagement CITY will convene all outreach events, including location, noticing, and publicizing and will prepare notices and staff reports for all public hearings and study sessions. CONSULTANT will be responsible for facilitating the relevant meetings, preparation of outreach/meeting materials, DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 7 of 30 and associated tasks as listed below. Task 2.1 Working Group CONSULTANT will facilitate up to ten Working Group meetings that will be open and noticed to the public. The Working Group is composed of City Council-selected community members including stakeholders, property owners, residents and business representatives. CONSULTANT will plan for one of the Working Group meetings to be combined with City Council Meeting #1 from Task 2.4, as a joint session to select project goals. The Working Group meetings will include goal setting, understanding of background conditions, feedback on proposed alternatives, and participation in evaluation of alternative concept plans. A self-guided walking tour will be developed for the Working Group. The purpose of the site walking tour will be to experience the scale of the Plan Area, provide context and explore physical constraints and opportunities. The Working Group will also serve as a conduit to the wider community and review. The potential topics to be covered at each of these meeting is listed below and referenced in the schedule. Further refinement to the topics for each meeting will be made in consultation with the City during project development. CONSULTANT shall attend a total of up to nine (9) Working Group meetings. Working Group Meeting #5 and beyond shall be 3 hours in length. CONSULTANT shall arrange for necessary subconsultants to attend Working Group meetings. Subconsultant attendance and participation in Working Group meetings is defined in the Schedule of Rates (Exhibit C-1) and elaborated below. Any attendance at Working Group meetings beyond stated meetings will incur additional costs subject to written approval from the CITY. • Working Group #1 – Context setting of the Plan Area • Working Group # 2 – Existing Conditions • Working Group # 3 – Neighborhood Metrics and Precedent Analysis • Working Group # 4 – Joint meeting with City Council on project status • Working Group # 5 – Plan Alternatives Development (ARUP and Strategic Economics subconsultants shall attend and participate) • Working Group # 6 – Reset Meeting (City Staff only, CONSULTANT shall not attend). • Working Group #7 – Report Out on Creek and HRB (City Staff only, CONSULTANT shall not attend). • Working Group #8a – Presentation of three alternatives and analyses - part I (ARUP and Strategic Economics subconsultants shall attend and participate). • Working Group #8b – Presentation of three alternatives and analyses - part II DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 8 of 30 (ARUP and Strategic Economics subconsultants shall attend and participate). • Working Group # 9 – Report on feedback and insights from Community Workshop #2 and progress update (City Staff only, CONSULTANT shall not attend) • Working Group # 10 – EIR Scoping, Plan Wrap Up and Final/Farewell Meeting • Working Group – Additional meeting, subject to CITY approval as an Additional Service (Note: CONSULTANT in consultation with CITY will determine the most appropriate time to conduct this meeting. The billing rates in Exhibit C-1 will apply if CITY authorizes this meeting as an Additional Service to be billed on a time and materials basis.) 2.1 Interim work products • Meeting agendas • Meeting action items Task 2.2 Stakeholder Meetings CONSULTANT will facilitate and solicit feedback from key stakeholder groups at up to fifteen meetings to be arranged by CITY staff. Stakeholders may include, but are not limited to, those from the following sectors or interest groups: • Businesses in the plan area - including Fry’s, auto repair shops, professional offices, tech companies and start-ups • Property owners • Residents from adjacent neighborhoods and resident groups (Ventura Neighborhood Association, PAN) • Representatives from organizations, including Palo Alto Forward, Asian Americans for Community Involvement (AACI), Silicon Valley Climate Action Alliance, Palo Alto Housing (http://pah.community/about- us/misson-history/) and other groups. Advocate groups (e.g., youth, affordable housing, education), such as Palo Alto Housing Corporation (non-profit, manages city’s AH program), Youth Community Service, Community Working Group (https://communityworkinggroup.org/), Rotary/Lions/Kiwanis (https://www.cityofpaloalto.org/partners/service_organizations/default.as p). SV Bicycle Coalition. Working with CITY staff, CONSULTANT will identify 3-5 key questions/clarifications request of the Stakeholder group to inform the development of land use alternatives. These questions will be sent to the stakeholders prior to the meeting for meaningful input during the sessions. Stakeholder meetings, when feasible, shall be grouped to solicit consolidated feedback. Stakeholders meetings outside of this on-site format will be conducted via phone. Each DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 9 of 30 stakeholder meeting shall be for 30 to 40 minutes. 2.2 Interim work products • Meeting agendas including 3-5 Stakeholder questions • Meeting action items Task 2.3.A Community Workshops CONSULTANT will facilitate two community workshops. The first community workshop will be a visioning exercise to discuss potential land use and transportation strategies. The second community workshop will be a presentation for feedback on the three plan alternatives. Task 2.3.B Pop-Up Workshops (support City) CONSULTANT will prepare public outreach materials based on on-going land use alternatives development to solicit broad community involvement. CITY staff will facilitate up to two sets of pop-up workshops or intercept meetings at two to three key locations in and around the planning area. These informal community meetings will be designed to “meet the community where they are” and facilitate discussion centered around the well-attended location and the overall planning area. The following are potential venues, locations or events pop-up workshops could be held: • Caltrain station • California Ave Farmers’ Market - Sundays 9am-1pm • College Terrace Branch Library (standalone display) CONSULTANT team will not attend the Pop-up Workshops. 2.3 Interim work products • Public outreach materials Task 2.4 Decision-Maker Meetings Members of the CONSULTANT team will attend up to five (5) public meetings or study session/hearings with CITY elected officials and/or boards/commissions such as City Council, Architectural Review Board and Planning & Transportation Commission. The agendas and meeting minutes for these sessions will be prepared by CITY Staff. These meetings are anticipated to address the following topics (topics are subject to change, as determined by CITY): • Decision Maker Meeting #1 April 2019 – Report back on existing conditions analysis and summary of Community Visioning Workshop; joint session with Working Group to identify project goals and vision. • Decision Maker Meeting #2 December 2019 – Planning and Transportation Commission (PTC); report back on concept alternatives, Working Group DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 10 of 30 evaluation of alternatives, community workshop insights, and seek guidance on recommended preferred alternative approach; • Decision Maker Meeting #3 – Planning and Transportation Commission – Identification of preferred alternative and/or feedback on the three alternatives if no alternative secures a majority vote. • Decision Maker Meeting # 4 April 2020 – Council to review alternatives and select a preferred plan alternative. • Decision Maker Meeting #5 (TBD) – Seek guidance on Final Coordinated Plan and guidance on Environmental Review/CEQA Clearance. Note: If additional meetings are required, CONSULTANT assumes attendance by at least two CONSULTANT team members, and preparation time on a time and materials basis. One team member may be sufficient; the CONSULTANT shall confer with CITY staff in advance of reducing the number of team members attending meetings. The hourly billing rates in Exhibit C-1 shall apply if additional meetings are required and approved by CITY as Additional Services. Task 2.5 Project Website To augment the community engagement efforts conducted via public meetings, CONSULTANT will prepare digital platforms to provide convenient access to the engagement effort for the community to share their voice and participate in the process. CONSULTANT, through its subconsultant Plan to Place, will host and prepare a wireframe for the project website to foster input from the CONSULTANT’s project team and CITY as the foundation for a tailored project website. The website will have a distinct web address and will be optimized to ensure compatibility across different devices and translatable into different languages. The website will serve as the primary online portal for community engagement and will include: • Important project updates • Upcoming events, including a map and a timeline • Updated summaries of workshop, forums, and other meetings • Opportunities to submit ideas and subscribe to project mailing lists • Access to educational resources and materials, both existing and developed for the purpose of the outreach effort 2.5 Interim work product • Website with regular updates at key intervals Task 2.6 Mailing List In order to ensure interested individuals and parties stay looped into project developments, a mailing list will be maintained by staff, accessible via the project website and sign-up sheets and information cards at public events. E-mail campaigns will be pushed through the mailing list to notify subscribers of upcoming engagement opportunities and events. City staff will manage DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 11 of 30 mailing list and provide the mailing list to CONSULTANT. CONSULTANT shall coordinate with City staff on preparation of distribution of email notifications and other communications. 2.6 Interim work product • Mailing List Task 2.7 Surveys - Mobile and Online CONSULTANT will prepare a digital platform to conduct two (2) community surveys through the project website. CONSULTANT, through its subconsultant Plan to Place, will also work with the CITY to integrate their Communications software as a multi-channel platform to elevate, streamline and track communications efforts. The Communications Cloud also has a metrics/reporting capability to measure results and assess the input received. The Consultant shall use a tailored survey campaign to reach underrepresented members of the community. Consultant shall develop Findings from these surveys and merge the data with information gathered from other survey resources. The Consultant may translate the surveys into languages other than English; translated surveys shall be consistent with those distributed through the website and email to ensure a standardized set of responses. CONSULTANT will provide support to CITY staff to administer surveys through the City’s existing Open City Hall platform or another alternative as identified by the City. 2.7 Interim work product • Preparation of 2 surveys and summary of results Task 3 Background Conditions Task 3.1 Data Collection and Mapping CONSULTANT will prepare geographical information using GIS-based maps for the study area boundary and wider context, including pedestrian walkways, bikeways, transit, vehicular, parking and other transportation networks and features. CONSULTANT will coordinate the mapping areas and provide the final product to CITY in a digital form that allows the layers of information to be easily accessed as needed. A deep understanding and consideration of the complex layers that make up our current and future urban environments is critical to the creation of great and high-performance networks and places. Using an innovative approach to planning and design, the CONSULTANT team will use this information to create a smart 3D model of the site and surrounding context. This model will include site opportunities and constraints, assets and challenges. This 3D model will be critical in the analysis and representation of existing and planned conditions and will be utilized throughout the entire project for concept and alternatives development and visualizations. Using DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 12 of 30 the GIS based map as well as the 3D model, CONSULTANT will develop appropriate 2D and 3D graphic material that illustrates the existing site as well as the future functioning of the site within the physical context of the city as a whole. CONSULTANT, through its transportation subconsultant ARUP, will request and assemble available transportation and parking data from CITY and CITY’s consultants to establish a baseline. CONSULTANT will collect turning movement counts for up to ten intersections in and just outside the project area and selected segment volumes. These intersections will be selected based on VTA TIA requirements and will supplement intersection counts available from the VTA Congestion Management Program (CMP) monitoring system. This will include counts at up to two unsignalized intersections to facilitate signal warrant analysis. CONSULTANT will also collect intersection pedestrian and bicycle counts at all locations. In addition, CONSULTANT will conduct parking inventory and occupancy counts, both on streets and within off-street facilities during peak times. Task 3.2 Policy Context CONSULTANT will review and analyze existing adopted plans and policies as a foundation for developing the Coordinated Area Plan, including but not limited to: • City of Palo Alto Comprehensive Plan, goals, policies and programs • City Council approved draft project goals and objectives • California Avenue Concept Study draft proposals • City of Palo Alto Masterplan for parks, trails, natural open space and recreation • Green stormwater infrastructure plan • Sustainability and climate action plan • Bike and pedestrian transportation plan • Applicable zoning and development standards • Residential off-street parking study Task 3.3 Background Conditions Analysis CONSULTANT will prepare geographical information using GIS-based maps for the Coordinated Area Planning process, including the following layers of information: • Existing land use and development patterns • Development capacity • Market rate and affordable housing • Transit and transportation, including biking and walking DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 13 of 30 • Existing cultural and natural resources • Public open space and community amenities • Infrastructure systems and capacity Task 3.4 Base Maps CONSULTANT will prepare a Base Map for use in the Coordinated Area Plan. CONSULTANT will utilize information from CITY to identify the sewer, storm, water electric, and gas infrastructure within the Coordinated Area Plan on the base map. CONSULTANT’s work on this task is based on the following assumptions: • CITY will provide GIS base with topography and existing property data. • CITY will provide CONSULTANT with record drawings, utility block maps and studies related to the areas infrastructure (water, wastewater, storm water/drainage, electrical, gas, communication, etc.) • CITY will provide CONSULTANT with existing utility capacity analysis reports and studies. 3.4 Interim work product • Base Map Task 3.5 Housing Including Affordable Housing CONSULTANT, through its subconsultant Strategic Economics, will review CITY’s Housing Element and Comprehensive Plan to identify issues and opportunities related to housing and affordable housing. Some of the potential topics to be considered in this task could include the supply of existing market-rate and below-market-rate housing in the Plan Area, the amount of housing capacity based on zoning, estimates of the need for market-rate and affordable housing in Palo Alto based on RHNA and barriers to housing production. 3.5 Interim work product • Memo summarizing issues and opportunities for housing/affordable housing in the Plan Area Task 3.6 Market Snapshot Report CONSULTANT will perform the tasks in this Task 3.6 through its economic analysis subconsultant (currently Strategic Economics). CONSULTANT will analyze and describe current market conditions for residential, R&D/office and commercial retail uses. The analysis will focus on determining the development product types, sales prices, and/or rents that would be achievable in the North Ventura Area. Subtasks will include the following: DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 14 of 30 3.6.1 Residential Market Conditions – CONSULTANT will interview residential developers and brokers, summarize current rents and sales price for higher-density residential products (rental and ownership product types) in the Plan Area and identify market-supportable product types and opportunity sites for housing; and determine the likely sales prices/rents of new housing by type. 3.6.2 R&D/ Office – Based on employment projections, existing market reports, interviews with local brokers and/or developers, and review of office and R&D development trends, CONSULTANT will examine types of R&D and office development likely to be supportable in the Plan Area. 3.6.3 Retail and Restaurants - CONSULTANT will assess the demand for “soft goods” retail stores and restaurants in the Plan Area based on: city sales tax data; data on rent, vacancy, and new construction trends for retail districts in Palo Alto and neighboring cities from brokers and Costar; and interviews with local retail and mixed-use developers. The analysis will provide an understanding of the market opportunities and barriers to retail and mixed-use development in the Plan Area. CONSULTANT shall use the findings of the analysis to develop an understanding of market-driven opportunities and constraints in the area, which will then inform development of the plan alternatives. CONSULTANT shall rely up on the findings of the market snapshot as a key input to the economic feasibility analysis, implementation, and fiscal impact analysis tasks described in Tasks 4 and 5. 3.6 Interim work products • Draft Market Snapshot Memo • Final Market Snapshot Memo Task 3.7 Existing Utilities Analysis CONSULTANT will perform this Task 3.7 through its subconsultant ( currently BKF). CONSULTANT will utilize the existing conditions base map prepared by CONSULTANT to review the utilities infrastructure within the Coordinated Area Plan. CONSULTANT will review the existing utility sizes, condition and identify existing capacity, identifiable capacity deficiencies, identifiable utility system upgrades required, and describe the existing utility infrastructure. CONSULTANT shall provide a narrative of the existing utilities, any identified deficiencies, and any identified opportunities for system upgrades or efficiencies. BKF shall provide recommendations on how to improve utility systems or identify future studies that may be needed to model, analyze, evaluate, and determine impacts to the systems. 3.7 Interim work product • Existing utilities summary memorandum DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 15 of 30 Task 3.8 Transportation and Parking CONSULTANT, through its subconsultant ARUP, will review and summarize relevant transportation plans and policies. This will include documenting planned transportation infrastructure improvements that could affect accessibility to the site. CONSULTANT will utilize available data, traffic counts, and parking counts to characterize existing transportation conditions. Qualitative street characterizations of the project area based on observations will be provided. CONSULTANT will also provide a description of current transportation issues such as deficiencies that impact safety, mobility and access in the project area. CONSULTANT will identify opportunities to improve transportation to and within the site, which could include additional transit service (Caltrain and El Camino Real corridor), safer roads and intersections and non-traditional approaches to improve mobility such as Mobility as a Service. CONSULTANT will prepare a transportation section of the report, which will summarize policy context, existing conditions and identify issues and opportunities. This will point to potential transportation strategies that will be developed in later study phases. 3.8 Interim work product • Transportation and parking summary memorandum Task 3.9 Environmental Assessment As part of the existing conditions analysis related to natural and man-made hazards and hazardous materials (including the regional plume and affected groundwater), CONSULTANT, through its subconsultant DJP&A, will prepare a Screening Level Phase I ESA for the area. Preparation of the Screening Level Phase I ESA includes the following: • Acquiring database reports to help establish the presence and type of contamination incidents reported in the site vicinity. • Reviewing on-line databases (GeoTracker and Envirostor) and available documents for up to ten facilities. Based on these reviews, a figure will be prepared that will present the reported and more significant ground water contamination plumes within the site boundaries. • Reviewing aerial photos to help develop a history of the previous site uses and adjacent area. • Summarizing the anticipated site hydrogeology based on readily available public information. • Completing a brief site visit from public right-of-way to observe existing conditions and note readily observable indications of past or present activities that may have or could cause significant site contamination. DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 16 of 30 3.9 Interim work product • Screening Level Phase I ESA Note: CONSULTANT shall identify on its invoices all work performed under this subtask 3.9 with the notation “CEQA review” (in addition to describing the substantive work performed), so that these work items will be invoiced towards the CEQA funding available for the project. Task 3.10 Opportunities and Constraints CONSULTANT will compile all data from Tasks 3.1 through 3.9 into a consolidated background conditions memo, including a narrative on existing opportunities and constraints. 3.10 Deliverable • Existing conditions memo with opportunities and constraints summary Task 3.11 Creek Analysis CONSULTANT will receive analysis related to Matadero Creek from CITY’s hydrology consultant. CONSULANT will incorporate the analysis of Matadero Creek into the three plan alternatives. Task 3.12 Historic Analysis of 340 Portage CONSULTANT will receive analysis from CITY’s historic preservation consultant regarding the historic nature of 340 Portage Street. CONSULTANT will incorporate and include this analysis in the plan alternatives as necessary and into the final plan as necessary. Task 4 Analysis of Options and Draft Plan Components Task 4.1 Development of Alternatives Based on information gathered during Tasks 2 and 3, CONSULTANT will work closely with CITY staff, stakeholders and the community to develop three land use/urban design alternatives for the study area. CONSULTANT will study test fit alternatives for these selected sites, to understand development yields and market support among other factors. For the purposes of policy discussion, environmental assessment and downtown character, the alternatives will contrast different land use compositions and development densities. Each land use alternative will include a summary of the development potential, including a list of the analysis assumptions made. Draft land use alternatives will include information about: • Land uses and densities • Building massing and heights • Street network and connectivity • Public open space and community amenities • Opportunities for multi-modal improvements and accessibility DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 17 of 30 • Parking supply and demand CONSULTANT shall utilize two- and three-dimensional massing graphic outputs from the 3D model and precedent images to communicate the characteristics of the alternatives in an easy-to- understand format. 4.1 Deliverable • Three (3) draft land use/urban design alternatives with development summary table Task 4.2 Comparison of Alternatives CONSULTANT will compare the alternatives to each other with respect to the goals and framework established during Tasks 2 and 3 to help illustrate the differences between the alternative proposals. The comparison will include the relative merits of the development alternatives for additional housing opportunities, including the supply of affordable housing and an analysis of potential sources for additional employment opportunities and the workforce characteristics required for such employment. Other aspects to be compared will include density and land use, distribution and amount of open space, impacts on traffic/parking and vehicle trip generation, where there are differences between the two approaches. CONSULTANT, through its subconsultant ARUP, will advise on three proposed street network and parking options for the project area. This will include the following: proposing initial circulation options that allow developing baseline parking projections based on different programs; proposing a suite of transportation improvements that reduce parking requirements and trip generation; advising on a street hierarchy for the site, and developing parking access recommendations. Based on alternative land use programs and street configurations, CONSULTANT will analyze parking impacts and traffic for three land use/transportation improvement options. Parking demand will be calculated using a spreadsheet model, taking into account proposed driving reduction measures, feeding back into site parking design. The projected demand for each alternative will be compared with Palo Alto’s current parking requirements and any available findings of its residential off-street parking study, and parking ratios appropriate for the site will be recommended. 4.2.1 Parking Model Calibration CONSULTANT shall perform the tasks in this section entitled “Parking Model Calibration” through its traffic/transportation subconsultant (currently ARUP). CONSULTANT will provide a context-sensitive analysis of parking demand that responds to transportation demand management (TDM) best practices. This analysis will utilize and calibrate two models: a parking model and a sketch planning model, to develop a customized set of parking ratios for each proposed land use type that respond to unique local characteristics. DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 18 of 30 CONSULTANT will use a parking model developed by the Urban Land Institute (ULI) and the International Council of Shopping Centers (ICSC) that measures the peak parking demand for every land use within a mixed-use development, while accounting for opportunities to share parking across land uses. CONSULTANT will leverage existing parking demand data for the NVCAP existing conditions report to calibrate ULI’s shared parking model to accurately reflect the existing parking conditions at the site. Other model calibrations will include the quantification of existing and planned land use, adjustments for vehicle occupancies, and adjustments for market synergy e.g. the relationship among planned land uses that reduces total parking demand. Once the model is calibrated, CONSULTANT will use it to test the different land use scenarios to calculate future parking demand with the current mode share. To estimate the impact of proposed transportation demand management (TDM) strategies on parking demand, as well as the site’s proximity to high quality transit, CONSULTANT will then utilize a sketch planning model (such as MXD, CalEMod or GreenTrip Connect) to estimate the impact of TDM strategies on the current mode split, which will be fed into the calibrated parking model to determine estimated parking demand. 4.2.2 Traffic Analysis CONSULTANT shall perform the tasks in this section entitled “Traffic Analysis” through its transportation/traffic subconsultant (currently ARUP). To estimate traffic impacts CONSULTANT will take both a traditional intersection impact approach and conduct a Vehicles Miles Travelled (VMT) analysis. For the former CONSULTANT will utilize a Traffix modeling software to determine impacts on no more than ten (10) key intersections in and around the project area based on alternative land use programs and proposed alternative transportation infrastructure and services, and using the results to determine what if any traffic infrastructure upgrades would be required for each option. This evaluation is to be distinguished from the anticipated project-level Traffic Impact Analysis (TIA), which is described in Task 6.1. This analysis will nonetheless establish background and cumulative conditions, using assumptions from the Comprehensive Plan and VMT’s regional model, and evaluate the impact of each land use alternative on key intersection Level of Service (LOS). It will also serve as the basis for developing the project TIA. 4.2.3 Vehicle Miles Travelled Analysis CONSULTANT shall perform the tasks in this section entitled “Vehicle Miles Travelled Analysis” through its transportation/traffic subconsultant (currently ARUP). CONSULTANT will perform a VMT analysis consistent with State guidelines to compare the regional impact of the two alternatives. This is consistent with the approach taken in the Comprehensive Plan. 4.2.4 Municipal Fiscal Impact Study CONSULTANT, through its economi c analysis subconsultant ( currently Strategic Economics), will estim shall perform the tasks in this section entitled “Municipal Fiscal Impact Study”ate the fiscal impact of development in the Plan Area. The analysis will estimate the fiscal impact of potential future development scenarios compared to the baseline existing conditions on the City of Palo Alto’s General Fund. The fiscal study will estimate the potential change in City operating DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 19 of 30 revenues and expenditures resulting from projected growth in residential, office/R&D and retail land uses. CONSULTANT will analyze the property tax, sales tax, and other major sources of General Fund revenues generated by the development in the Draft Plan, compared to the existing land uses. After conducting interviews with key City departments including Police, Fire, Public Works, Parks and Recreation, CONSULTANT will calculate the increase in General Fund expenditures for providing services to new residents and employees under each scenario. Based on the results of the fiscal assessment, CONSULTANT will determine whether the estimated public revenues would offset increases in the cost of public services to serve new development. The fiscal impact study will be conducted for each of the three plan alternatives. NOTE: This analysis relates to task 4.2a and 4.2b. 4.2.5 Infrastructure CONSULTANT shall perform the tasks in this section entitled “Infrastructure”, through its subconsultant (currently BKF), will compare water and wastewater demand calculations for the three alternatives. CONSULTANT will also provide an infrastructure cost estimate based on the preferred concept plan/program, including: proposed utilities, hardscape, roadway improvements and storm water treatment. BKF will provide this pricing as a supplement to the project cost estimator. The estimated cost will represent the level of information known at that time, and will be used as an indicator of overall costs, for use in the project evaluation/cost estimate by the CONSULTANT project team. 4.2.6 Any Incompatibilities with Existing Policies CONSULTANT will prepare a commentary on the extent to which any aspect of the three alternatives deviate from current City policies and ordinances. Where appropriate, CONSULTANT will comment on the restrictions imposed by existing policies and offer suggestions for any changes necessary to facilitate the proposals. 4.2.7 Evaluation charrettes CONSULTANT will prepare the above referenced analyses in advance of, and for review and discussion, at a four-hour (4) ‘evaluation charrette’. The charrette will include City Staff and relevant members of the CONSULTANT design team to review the CONSULTANT team analyses and prepare for presenting the three alternatives to the Working Group, decision-makers, and the public. CONSULTANT shall prepare a second four-hour (4) charrette, following presentation of the three plan alternatives to the Working Group, decision-makers, and others. The purpose of this charrette will be to understand the connection between feedback and the plan alternatives and to agree upon any needed adjustments as well as to evaluate the presentation, materials, and outreach. Members of the CONSULTANT design team will summarize this charrette for the benefit of the meeting with the Decision-Makers Meeting #3. 4.2 Deliverables DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 20 of 30 • Comparative summary memorandum of the alternatives (Urban Design, Traffic, Economics, Infrastructure). • Charrette preparation, consultant coordination and meeting materials. • Technical memo detailing the methodology, key inputs and assumptions, and full results. • Executive summary of the analyses and key findings that is appropriate for non-technical audiences including the NVCAP working group, City Council and other interested parties. • Slide deck version of the executive summary. • Oral presentation of the key findings and analyses at two public meetings; CONSULTANT’s transportation/traffic subconsultant’s project manager shall participate in presentations (Autumn Bernstein of ARUP). Task 4.2a Evaluation of Proposed Policies CONSULTANT, through its economic analysis subconsultant (currently Strategic Economics), will assess the financial feasibility of imposing new requirements for new development in the Plan Area, which may include: • Higher inclusionary requirements than the current Below-Market-Rate policy requirements for rental and ownership housing. • New workforce housing requirements in addition to the current Below Market Rate (BMR) requirements. The definition of workforce household income targets will be developed in coordination with City Staff. Based on research of similar policies in other cities, and taking into account the existing conditions of the NVCAP area and the Palo Alto market context, CONSULTANT will also provide guidance on the viability of establishing policies to accomplish the following objectives: • Prevent displacement of existing residents in the NVCAP area • Encourage small office uses (for smaller businesses) through tools such as imposing a limit on office building sizes or other strategies • Encourage unconventional housing type (co-ops missing middle, etc.) 4.2a Deliverable Memo Report that addresses all of Task 4.2a to be incorporated into the Plan. Task 4.2b Evaluation of Financial Feasibility and Economic Value of NVCAP CONSULTANT shall perform this Task 4.2b through its economic analysis subconsultant (currently Strategic Economics). CONSULTANT will (1) measure and compare the financial feasibility of three NVCAP development alternatives, and (2) will analyze the economic value of the NVCAP development alternatives to property owners (defined as the DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 21 of 30 increase in residual land value created from new land use regulations / zoning / incentives). CONSULTANT will also assess the extent to which the value created by new development in the NVCAP development alternatives can help fund community infrastructure and amenities included in the alternatives (e.g., parks/open space, creek restoration, bicycle and pedestrian facilities, roadways, etc.). The findings of these analyses will allow decision makers to better understand which alternatives are more likely to be delivered by private developers, and to understand the extent to which each alternative can generate private funding to deliver desired infrastructure and amenities. Financial Feasibility CONSULTANT will prepare three plan alternatives that provide sufficient detail to develop pro forma models that analyze the alternatives’ financial feasibility. Working closely with the City, CONSULTANT, through its economic analysis subconsultant (Strategic Economics) will build a pro forma model that measures the economic feasibility of building prototypes that exemplify the range of land uses and development products envisioned in the plan alternatives. The land uses will likely include R&D/office, mixed-use, and residential. CONSULTANT’s economic analysis subconsultant in close coordination with CONSULTANT will develop the building prototype inputs (height, unit sizes, parking, etc.). The market inputs will be based on the market analysis in Task 3.6 and vetted with developers active in Palo Alto and neighboring cities. The prototypes will detail factors such as the building formats, building heights, parking spaces and format, square feet of different land uses, number and types of housing units, square feet of demolished uses, and land area of new public and private streets, paseos, plazas, etc. The analysis will be structured to provide information about the economic incentives and disincentives to build the types of development products that are desired in the Plan Area, and the potential for private development to help fund infrastructure improvements in the Plan Area. CONSULTANT will provide order-of-magnitude cost estimates for the construction of significant new infrastructure and amenities in each alternative. The remaining tasks in this section entitled “Financial Feasibility” shall be performed by CONSULTANT through its economic analysis subconsultant (currently Strategic Economics). CONSULTANT will conduct additional research to develop revenue and cost inputs for use in the pro forma analysis. In work related to Task 5.3, CONSULTANT analyzed the financial feasibility of specific housing prototypes; under Task 5.3, CONSULTANT will also conduct additional research to develop inputs to perform a pro forma financial feasibility analysis for R&D/Office and mixed-use development. Under Task 4.2b, CONSULTANT will complete additional research to update inputs to the previous residential pro forma analysis and will develop revenue and cost inputs applicable to the comprehensive and specific NVCAP development alternatives, including demolition of existing structures and construction of on-site infrastructure and amenities. The analysis will rely on market data, as well as interviews with brokers, developers, and other local real estate experts. DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 22 of 30 Value Capture CONSULTANT shall perform the tasks in this section entitled “Value Capture” through its economic analysis subconsultant (currently Strategic Economics). Using rates of return and/or residual land values that are consistent with current market expectations, CONSULTANT will determine the financial feasibility of each alternative. CONSULTANT will then describe the trade‐offs from each alternative, including the extent to which development in the alternative generates economic value that could be dedicated to public infrastructure, amenity investments, or community benefits, and the gap in infrastructure costs that would need to be covered by the City. CONSULTANT will participate in two meetings with local developers/property owners/stakeholders to inform the analysis. CONSULTANT will also participate in two calls with City staff to guide the analysis and report on the results and will participate in up to two additional meetings of the working group, community, or City Council to present the results. Finally, CONSULTANT will perform a comparable analysis of the preferred plan alternative to allow comparison against the three NVCAP development alternatives. 4.2b Deliverable CONSULTANT will deliver one memo report that addresses all of Task 4.2b through the comparison of the NVCAP development alternatives. CONSULTANT will deliver a brief follow-up memorandum that describes results of the analysis of the preferred plan alternative. CONSULTANT to prepare ROM infrastructure cost estimation of all three draft plan alternatives. Task 5 Draft Coordinated Area Plan Task 5.1 Preferred Concept Plan and Program Based on comments from the Working Group, stakeholders, and direction from City staff and Decision-Makers, CONSULTANT will refine the preferred concept plan for the North Ventura Coordinated Area Plan. The preferred concept plan will serve as the basis for the preparation of Development Standards, Design Criteria and the Coordinated Area Plan Report. 5.1 Deliverable • Preferred concept plan and program Task 5.2 Draft Coordinated Area Plan Report CONSULTANT will work with CITY staff to confirm an agreed outline and Table of Contents for the Coordinated Area Plan and will then prepare a Draft Report for review by City staff and stakeholders. The Draft Report will incorporate the preferred plan, programs and guidelines prepared in the previous task. As necessary, the Coordinated Area Plan Report will include supporting plans, diagrams, sketches and pictures to convey, illustrate and exemplify DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 23 of 30 Coordinated Area Plan content. The proposed schedule allows for one review of the Administrative Draft Plan by City staff. One set of consolidated comments will be submitted by CITY to CONSULTANT after review of the Administrative Draft Plan. CONSULTANT will present the preferred plan to the Working Group, and Decision-Makers and will facilitate one community workshop to solicit community reaction to the development of the preferred plan. The draft and final Coordinated Area Plan Report will include the following sections. 5.2.1 Land use The report will illustrate the distribution, location and intensity of land uses, including industrial, office, retail, entertainment, residential, community amenities, public open space and parking supply within the study area. 5.2.2 Transportation CONSULTANT through its transportation/traffic subconsultant (currently ARUP) will further develop transportation infrastructure, services and programs for the preferred option, describing these using narratives, mapping and typical cross-sections and plans. CONSULTANT will advise in the development of design guidelines for streets and other transportation infrastructure (e.g., bike/ped paths, transit stops). 5.2.3 Utilities and Infrastructure CONSULTANT through its subconsultant (currently BKF) will prepare utility demand forecasts for the Coordinated Area Plan, based on land uses supplied by CONSULTANT to determine if the current infrastructure is able to accommodate the proposed land uses and infrastructure presented as part of the Coordinated Area Plan. CONSULTANT will also contact utility providers with required project utility demands to verify existing capacities or required changes to the utility infrastructure to meet the demand. 5.2.4 Development Standards and Design Criteria CONSULTANT will prepare Development Standards and Design Criteria for the private and public realms. These standards and criteria will “implement” and reinforce the preferred plan, focusing on the desired character of the Coordinated Area Plan. Such a framework will focus on the character, function and needs of the district, in particular the linkages between activity nodes and the character and needs of the public realm, pedestrian paths and building heights and orientation that frame and structure the streets. The standards and criteria will speak to both the built form and lands and character of the study area. CONSULTANT will consider the changing urban fabric, land use, density, open space, connections to adjacent areas, neighborhood transitions, circulation, sustainability and streets. Architectural design requirements will address street design and hierarchy, building design including streetwall and setbacks, public and private open spaces, street furniture, such as fences, arcades, sidewalk treatments etc. and concept design of parking areas. Specific building types, such as community DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 24 of 30 centers, if included in the preferred plan, will also be addressed. The guidelines will provide direction to private and public entities making improvements in the area and will be folded in the final report. 5.2 Deliverables • Draft Coordinated Area Plan Report • Final Coordinated Area Plan Report Task 5.3 Financial Feasibility and Economic Analysis The tasks in this Task 5.3 shall be performed by CONSULTANT through its economic analysis subconsultant (currently Strategic Economics). Under Task 4.2b, CONSULTANT will develop an initial Financial Feasibility and Value Capture analysis. Upon selection of a preferred Plan alternative, CONSULTANT, working close with CITY, will finalize the Financial Feasibility (4.2b), and Value Capture (4.2b), and Economic Analysis (4.1). Working closely with CITY, CONSULTANT will build a pro forma model that measures the economic feasibility of building prototypes that exemplify the range of land uses and development products envisioned in the Draft Plan. The land uses will likely include R&D/office, mixed-use, and residential. The building prototype inputs (height, unit sizes, parking, etc.) will be developed in close coordination with CONSULTANT. The market inputs will be based on the market analysis in Task 3.6 and vetted with developers active in Palo Alto and neighboring cities. The analysis will be structured to provide information about the economic incentives and disincentives to build the types of development products that are desired in the Plan Area, and the potential for private development to help fund infrastructure improvements in the Plan Area. In addition to the economic feasibility analysis, CONSULTANT will also provide a summary of the potential economic benefits of public infrastructure investments based on a review of existing literature and studies measuring the property value increases related to public realm and infrastructure improvements. 5.3 Deliverables • Draft Financial Feasibility and Economic Analysis Memo • Final Financial Feasibility and Economic Analysis Memo Task 5.4 Funding and Financing Implementation Strategy The tasks in this Task 5.4 shall be performed by CONSULTANT through its economic analysis subconsultant (currently Strategic Economics). CONSULTANT will prepare the implementation strategy for the North Venture Comprehensive Area Plan, focusing on identifying the funding sources and financing tools available to implement the infrastructure improvements identified in the Draft Plan. The implementation strategy will incorporate the findings of the financial feasibility analysis to establish whether private DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 25 of 30 developers and property owners could potentially contribute to necessary improvements. Based on the analysis, CONSULTANT will provide recommendations on using property-based financing tools like community facilities districts (CFDs), tax increment financing (TIF), benefit assessment districts, and other similar mechanisms. CONSULTANT will also identify available state and regional grants to help fund infrastructure improvements in the Plan Area. 5.4 Deliverables • Draft Funding and Financing Strategy Memo • Final Funding and Financing Strategy Memo Task 6 Environmental Clearance Task 6.1 As of the effective date of this Agreement, the City anticipates that either an Addendum or Supplemental Environmental Impact Report to the Comprehensive Plan Final Environmental Impact Report (2017) would be the appropriate level of environmental review for the North Ventura Coordinated Area Plan. The level of environmental review will be determined by the CITY, dependent upon the plan development. Task 6.1a Addendum to EIR If the City selects the addendum as the appropriate level of environmental review, the following shall occur (all tasks to be performed by CONSULTANT through its environmental review consultant (currently DJP&A and referred to herein as “CEQA subconsultant”), unless otherwise stated): CONSULTANT’s CEQA subconsultant will review the development assumptions and findings of the Comprehensive Plan Final Environmental Impact Report (2017) and assist as needed in preparing the existing conditions analysis. All this data will be compared to the Draft Plan for the North Ventura Coordinated Area Plan to determine the need for additional technical analyses and whether a different course of CEQA review may be appropriate. If it is deemed that an Addendum is the appropriate level of clearance, the CEQA subconsultant shall prepare the Addendum and all required documentation. If potential issues are found that could require an Initial Study/Mitigated Negative Declaration (IS/MND) or Supplemental Environmental Impact Report (SEIR), meaning the proposed plan would result in new or more significant impacts than were identified in the Comprehensive Plan Final Environmental Impact Report (2017), the CEQA subconsultant would notify the City immediately to determine next steps. Once a final determination is made on the level of environmental review required, DJP&A would prepare the necessary analysis based on new technical analyses (as warranted) and existing data. DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 26 of 30 The CEQA subconsultant and CONSULTANT’s transportation/traffic subconsultant (ARUP) will assist with the preparation of the background conditions analysis for the following resource areas, as this data would most likely be required for the environmental review: • Traffic, parking, transit, bicycle, and pedestrian facilities and demand • Cultural and natural resources • Natural and man-made hazards and hazardous materials, including the regional plume and affected groundwater • Parks, community centers, schools and other public facilities and conditions Consistent with the Comprehensive Plan, CONSULTANT’s transportation/traffic subconsultant will provide for this amendment both a traditional the Level of Service (LOS) Traffic Impact Analysis (TIA) and a projection of project-generated VMT technical memorandum, utilizing the Synchro Analysis in task 4.2. This will be a multimodal approach, focusing not only on traffic but also transit, bicycle and pedestrian connectivity, convenience, and safety. Transportation impacts will be analyzed in accordance with the standards and methodologies found in VTA's Transportation Impact Analysis Guidelines. It is assumed that TIA trip threshold of 100 or more net new peak hour trips will be met. The following scenarios will be analyzed: • Existing • Existing plus Project • Background • Background plus Project • Cumulative • Cumulative plus Project It is assumed that signal warrant analyses for up to two currently unsignalized intersections will be conducted. The TIA may include the following optional tasks: • Impact analysis of four freeway segments and eight freeway ramps • Local street traffic volume impact analysis using the TIRE methodology for up to four residential street segments • Bus transit service delay/quality of service analysis These optional tasks will be considered outside of scope and billed at time and materials using ARUP rates in Exhibit C-1. CONSULTANT’s CEQA subconsultant will review the proposed project in relation to the findings of the Screening Level Phase I ESA under Task 3.9, to determine potential impacts/mitigation measures. The CEQA subconsultant will prepare Technical Environmental Reports analyzing the draft Coordinated Area Plan for all topics as warranted (and if not covered by the Comprehensive Plan EIR). These may include, but not be limited to, CEQA issues such as transportation (LOS DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 27 of 30 and VMT); air quality; noise; soils and groundwater (i.e., related to the existing plume and groundwater issues); and greenhouse gas emissions and at least one non-CEQA issue: parking. Note: CONSULTANT shall identify on its invoices all work performed under Task 6 with the notation “CEQA review” (in addition to describing the substantive work performed), so that these work items will be invoiced towards the CEQA funding available for the project. Task 6.1a Supplemental Environmental Impact Report If CITY determines that a Supplemental Environmental Report to the Comprehensive Plan EIR is the appropriate level of environmental review Impact, in addition to Task 6.1a, CONSULTANT through its CEQA subconsultant shall do the following: • Prepare a Notice of Preparation (NOP). • Attend a scoping meeting during the public circulation of the NOP. • Complete additional analysis for cumulative impacts and alternatives to the proposed project. • Prepare a Draft EIR. • Respond to public comments on the Draft EIR. • Prepare final EIR. • Submit all required documents to the State Clearinghouse in accordance to CEQA. Task 7 Hearings and Coordinated Area Plan Adoption Task 7.1 Adoption Hearings Members of the CONSULTANT team will attend up to two hearings (Adoption Hearings #1 and #2) by the Planning and Transportation Commission; one hearing of the Architectural Review Board (Adoption Hearing #3) and up to two hearings by the City Council to present the plan for adoption (Adoption Hearing #4 and #5). NOTE: This is in distinction to Task 2.4 Decision-Maker meetings that allows the decision-makers to weigh in on the effort versus hearings that are for the consideration of plan adoption. Task 7.2 Adopted Plan CONSULTANT will prepare and submit the final Coordinated Area Plan in both an editable digital and a PDF format upon adoption by the City Council. Note: For additional meetings that may be required CONSULTANT team assumes attendance by at least two personnel and preparation time on a time and material basis. The billing rates in Exhibit C will apply for the Time and Materials authorization upon approval by the City as an Additional Service. DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Page 28 of 30 Task 8 Additional Services In addition to the meetings noted in Tasks 2 and 7, additional services that may be included under this Agreement include: 1. Additional Working Group Meetings (Task 2.1) 2. Additional Decision Maker and public hearings, such as City Council Finance or Policy and Services Committees (Tasks 2.4 and 7.1) DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD EXHIBIT “C” COMPENSATION CITY agrees to compensate 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 Task 1 NOT TO EXCEED AMOUNT $142,248 (Project Coordination and Management) Task 2 $173,053.00 (Community Engagement) Task 3 $129,509.00 (Background Conditions) Task 4 $275,833 (Analysis of options and draft plan components) Task 5 $154,638.00 (Draft Coordinated Area Plan) Task 6 $126,456.00 (Technical analyses and EIR) Task 7 (Hearings and adoption) $29,652.00 Sub-total Basic Services $1,031,388.00 Reimbursable Expenses (other Direct Cost) $3,000.00 Total with Reimbursable expenses $1,034,388.00 DocuSign Envelope ID: DA9D5773-2BAF-40D1-832A-CA743F4ACBBD Additional Services (Not to Exceed) $103,438.00 Maximum Total Compensation $1,137,826.00 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. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: A. Travel outside the San Francisco Bay area, including transportation and meals, will be reimbursed at actual cost subject to the City of Palo Alto’s policy for reimbursement of travel and meal expenses for City of Palo Alto employees. B. Long distance telephone service charges, cellular phone service charges, facsimile transmission and postage charges are reimbursable at actual cost. All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense anticipated to be more than $500.00 shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. CONSULTANT, at 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. Vers.: Aug. 5, 2019 City of Palo Alto (ID # 10620) City Council Staff Report Report Type: Consent Calendar Meeting Date: 10/21/2019 City of Palo Alto Page 1 Council Priority: Transportation and Traffic Summary Title: Amendment 1 to Contract for Temporary Valet Parking Services with SP+ Title: Approval of Amendment Number 1 to Contract Number C19173514 With SP Plus to add $150,000 for Expansion of the Valet Parking Program to California Avenue Parking Facilities and a Total Not-to-Exceed Amount of $1,050,000 From: City Manager Lead Department: Transportation Recommendation Staff recommends that Council approve Amendment Number One to Contract No. C19173514 (Attachment A) with SP Plus to add $150,000 to expand valet-assist services to California Avenue parking facilities for a total contract amount not to exceed $1,050,000. Background/Discussion In early 2014, Staff began significant efforts to address the City’s parking and traffic challenges, particularly in the Downtown core, through a multi-pronged approach. The strategy includes projects to increase parking supply and availability (parking supply measures), improving how the existing parking facilities are utilized and controlled (parking management strategies), and projects to reduce overall traffic demand and encouraging alternatives to driving (transportation demand management strategies). One component of this strategy is more efficient usage of the existing parking capacity, and valet-assist parking is one part of this program. On October 4, 2018, the City’s Purchasing Department released a Request for Proposals (RFP) for services including the implementation, support, and related services of a Parking Ambassador Program to continue and enhance the customer experience for valet parking in City parking garages. City of Palo Alto Page 2 In addition to the regular public posting of the RFP available to 414 vendors, the following companies that specialize in parking valet services were directly contacted and provided information about the opportunity to submit a bid for this RFP: • SP Plus • ProPark • Ace Parking • California Parking • Serco, Inc. • Douglas Parking The RFP closed on November 6, 2018. Thirteen (13) out of 414 prospective bidders downloaded the bid document. Interest in the RFP was low, likely because of issues in the market related to recruiting and staff retention and challenges for retaining hourly staff. The City received one proposal in response to the RFP from SP Plus. Upon review of their proposal, SP Plus was recommended as the preferred vendor for this project due to their expertise in municipal operations and comprehension of the parking environment for Palo Alto as the incumbent. Based on the single proposal, staff selected SP Plus for the commencement of contract negotiations, which were completed on March 4, 2019 (Attachment B). On April 22, 2019, the City’s Public Works Department began construction for the new parking garage, reducing the number of available public parking spaces in the California Avenue Commercial District. Business owners and operators in the California Avenue area expressed concern about that loss of parking and requested additional mitigations. Some California Avenue merchants have indicated that their business is down as much as 20% since garage construction impacts began in late January 2019. In March 2019, staff learned that the merchants were surprised that valet service was provided to the University Avenue business district, but none was proposed for the California Avenue area. Therefore, staff initiated an expansion of the Downtown Valet Parking Program to include temporary valet service at Lot C- 6, increasing supply by ~40 vehicles. Expansion of the valet program to 258 Sherman Ave (Lot C- 6) occurred concurrently with construction closures, with options to expand to additional California Avenue parking facilities if/as needed based on occupancy. Amendment Number One would add additional funding and expand services as a temporary program during the peak hours of 11:00 am to 3:00 pm, Monday through Friday, excluding City of Palo Alto Page 3 holidays. Additional valet service can be canceled at any time and would conclude upon the competition of the new parking garage in the summer of 2020. Timeline Staff expects to implement the new valet parking program at Lot C-6 late Summer 2019. Implementation at additional facilities would come at a later timeframe depending on the utilization of the garage. Resource Impact A total of $150,000 was appropriated for valet services in the FY 2019 Adopted budget and remained unspent at year end due to delays in garage construction. A recommendation to carry forward this funding from FY 2019 to FY 2020 is included as part of the annual reappropriations process, tentatively scheduled for City Council approval on October 21, 2019. It is expected that the garage will be completed by the end of FY 2020. The total monthly costs for additional services at each garage are as follows: Task Category Hourly Rate Est. Monthly Hours Extended Monthly Cost Lot C-6 Location with two ambassadors $29.90 160 $4,784.00 Policy Implications Expansion of the valet-assist program to other Downtown garages is consistent with the current Comprehensive Plan Goals: Policy T-45: Provide sufficient parking in the University Avenue/Downtown and California Ave business districts to address long-range needs. Program T-52: Evaluation options to ensure maximum use of the City parking structures in the University Avenue/Downtown and California Avenue areas. Environmental Review The proposed action would implement operational changes at existing garages and is exempt from review under the California Environmental Quality Act (CEQA) under Class One (CEQA Guidelines Section 15301, Existing Facilities) and because it can be seen with certainty that the proposed action to incrementally increase garage capacity via operational changes could not have a significant effect on the environment (CEQA Guidelines Section 15061(b)(3), the “general rule”). City of Palo Alto Page 4 Attachments: Attachment A - SP Plus C19173514 Amendment 1 (PDF) Attachment B - SP Plus C19173514 (PDF) Page 1 of 5 AMENDMENT NO. 1 TO CONTRACT NO. C19173514 BETWEEN THE CITY OF PALO ALTO AND SP PLUS CORPORATION This Amendment No. 1 (this “Amendment”) to Contract No. C19173514 (“Contract”) is entered into as of October , 2019, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SP PLUS CORPORATION, a Delaware corporation, located at 3740 Wilshire Blvd, Suite 400, Los Angeles, CA 90010 ("CONSULTANT"). R E C I T A L S A. The Contract was entered into between the parties on March 1, 2019 for the operation of the Parking Ambassador Program by CONSULTANT at multiple CITY public parking facilities in Downtown Palo Alto with the potential to extend these services to parking facilities in the California Avenue area. B. The parties now wish to amend the Contract to extend the Services to include the California Area parking facilities, increase the total not-to-exceed amount of compensation by One Hundred Fifty Thousand Dollars ($150,000.00), from Nine Hundred Thousand Dollars ($900,000.00) to a new total not-to-exceed amount of One Million Fifty Thousand Dollars ($1,050,000.00), with the term to remain the same. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the parties agree as follows: SECTION 1. Section 1, SCOPE OF SERVICES, is hereby amended to read as follows: “CONSULTANT shall perform the Services described in the attached Exhibit “A” and Exhibit “A-1” in accordance with the terms and conditions contained in the Agreement. The performance of all Services shall be to the reasonable satisfaction of the CITY.” SECTION 2. Section 4, NOT TO EXCEED COMPENSATION, of the Contract is hereby amended to read as follows: “The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” and Exhibit “A-1” (together, the “Basic Services”), and reimbursable expenses, shall not exceed One Million Fifty Thousand Dollars ($1,050,000.00) and CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount. The applicable rates and schedule of payment are set out in Exhibit “C-1” and Exhibit “C-2” both entitled SCHEDULE OF RATES” of the original contract and Exhibit “C-2” of Amendment No. 1 entitled “SCHEDULE OF RATES,” which are attached to and made part of this Agreement. If any regulatory changes, or changes in applicable laws, have a material impact on CONSULTANT’s expenses in performing its obligations under this Agreement, CONSULTANT and CITY agree that the parties will negotiate in good faith equitable adjustments in compensation. DocuSign Envelope ID: 1013C227-2F50-4C64-9943-D50D5C692F48 Page 2 of 5 Additional Services, if any, shall be authorized in accordance with the and subject to the provisions to Exhibits “C” and “C-2”. CONSULTANT shall not receive any compensation for Additional Services performed without the prior written authorization of the 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 including within the Scope of Services described in Exhibit “A” and Exhibit “A-1.” SECTION 3. The following exhibits to the Contract are hereby amended or added to read as set forth in the attachments to this Amendment, all of which are hereby incorporated into this Amendment as though fully set forth herein, and into the Contract as though fully set forth therein, respectively, by this reference. a. Exhibit “A-1” entitled “SCOPE OF SERVICES” - Added b. Exhibit “C-2” entitled “SCHEDULE OF RATES” - Added SECTION 4. Legal Effect. Except as expressly modified by this Amendment, all of the terms and conditions of the Contract, including any exhibits thereto, shall remain unchanged and in full force and effect. SECTION 5. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are hereby fully incorporated herein by this reference. (SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.) DocuSign Envelope ID: 1013C227-2F50-4C64-9943-D50D5C692F48 Page 3 of 5 SIGNATURES OF THE PARTIES IN WITNESS WHEREOF, the parties have by their duly authorized representatives executed this Amendment effective as of the date first written above. CITY OF PALO ALTO _________________________ City Manager APPROVED AS TO FORM: _________________________ City Attorney or designee SP PLUS CORPORATION By:__________________________ Name:_______________________ Title:________________________ Attachments: Exhibit “A-1” entitled “SCOPE OF SERVICES”, AMENDMENT NO. 1 Exhibit “C-2” entitled “HOURLY RATE SCHEDULE”, AMENDMENT NO. 1 DocuSign Envelope ID: 1013C227-2F50-4C64-9943-D50D5C692F48 Senior Vice President Jason Johnston Page 4 of 5 EXHIBIT “A-1” SCOPE OF SERVICES AMENDMENT NO. 1 CONSULTANT shall provide the following valet services (SERVICES) at the parking lot located at 258 Sherman Ave., Palo Alto 94306 (Lot C-6). Valet services shall be available to the public Monday-Friday 11:00 am – 3:00 pm o Valet services will not be available on CITY holidays CONSULTANT shall staff Lot C-6 with two attendants working four-hour shifts Valet service available to short term parkers o CONSULTANT may implement a holdover fee ($25-50) if a customer requests their vehicle after operating hours (3:00 pm). Card payments only California Avenue Business District permit holders may utilize service and must adhere to the same regulations and pickup procedures as short- term parkers Permits holders shall not be exempt from holdover fees Valet handoff o CONSULTANT will use a three-part ticket with a stamp with a ticket number, liability info, contact number, and lot address CONSULTANT will perform spot check on claim ticket for auto damage. CONSULTANT will ask customer(s) for a contact number in case of a vehicle emergency. CONSULTANT will emphasize Parking Time Limits and encourage the purchase of a daily permit from the pay station if parking longer than two hours. At 2:30 pm each day, CONSULTANT will text or call the customer with a reminder to pick up keys. CONSULTANT will move holdover vehicles to a marked stall within Lot C-6 and be released on the following business day. CONSULTANT shall provide a mobile staging area for vehicle drop off and key lockbox and relocated to a secured offsite location during non-operating hours. CONSULTANT will provide daily occupancy data including but not limited to: o Hourly occupancy counts o Number of vehicles valet parked o Daily valet and holder vehicle counts DocuSign Envelope ID: 1013C227-2F50-4C64-9943-D50D5C692F48 Page 5 of 5 EXHIBIT “C-2” SCHEDULE OF RATES AMENDMENT NO. 1 Compensation Schedule CONSULTANT shall be paid hourly for each ambassador and manager providing the Parking Ambassador Program services at the CITY parking facility described below. The compensation table shall remain fixed for term of the Agreement. Table 1 Compensation Terms Task Category Hourly Rate Est. Monthly Hours Extended Monthly Cost Lot C-6 Location with two ambassadors $29.90 160 $4,784.00 DocuSign Envelope ID: 1013C227-2F50-4C64-9943-D50D5C692F48 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 1 CITY OF PALO ALTO CONTRACT NO. C19173514 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND SP PLUS CORPORATION FOR PROFESSIONAL SERVICES This Agreement is entered into on this 1st day of March, 2019, (“Agreement”) by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SP PLUS CORPORATION, a Delaware corporation ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to have the CONSULTANT operate the Parking Ambassador Program at multiple public parking facilities in Downtown Palo Alto (“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 March 1, 2019 through February 28, 2022 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 not preclude recovery of damages for delay if the extension is required due to the fault of CONSULTANT. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 2 SECTION 4. NOT TO EXCEED COMPENSATION. Provided that the Basic Services do not exceed 30,100 total labor hours, the compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A” (“Basic Services”), and reimbursable expenses, shall not exceed Nine Hundred Thousand Dollars ($900,000.00) and 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 “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. If any regulatory changes, or changes in applicable laws, have a material impact on CONSULTANT’s expenses in performing its obligations under this Agreement, CONSULTANT and CITY agree that the parties will negotiate in good faith equitable adjustments in compensation. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. 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 shall pay invoices within thirty (30) days of receipt. If payment is not made by the CITY to CONSULTANT within said 30-day period, CONSULTANT shall have the right to: (i) charge interest at the highest legal rate permitted by law on the unpaid balance from the date such interest at the highest legal rate permitted by law on the unpaid balance from the date such payment became due and payable; or (ii) at it option, terminate this Agreement upon 30 days’ prior written notice, without waiving or limiting any of its legal remedies (including the right to recover attorney’s fees and other expenses incurred) which CONSULTANT may pursue to collect the amount owed. 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 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 3 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 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 unless CITY fails to pay CONSULTANT pursuant to the terms herein. 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 Victor Alistar to have supervisory responsibility for the performance, progress, and execution of the Services DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 4 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 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 Mark Hur, Planning & Community Environment Department, Transportation Division, 250 Hamilton Avenue, Palo Alto, CA 94303, Telephone (650) 329- 2453. 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”) resulting from, arising out of or in any manner related to performance or nonperformance by 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 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 5 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 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 Ke y Ratin g 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. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 6 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. 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: SP Plus Corporation Attn: Legal Department 200 E. Randolph Street, Suite 7700 Chicago, IL 60601 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 7 With a copy to: SP Plus Corporation Attn: Jason Johnston Senior Vice President 3470 Wilshire Blvd., Suite 400 Los Angeles, CA 90010 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 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 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 8 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 the 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 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 4.62.30 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. In the event that the minimum wage set forth in the Minimum Wage Ordinance shall increase above $15.00 per hour, then the hourly rate set forth in the HOURLY RATE SCHEDULE set forth in Exhibit “C-1” shall be increased on a dollar-for-dollar basis. 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 SB 7 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. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 9 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 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 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 10 executed by all the parties, constitute a single binding agreement. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 11 CONTRACT No. C19173514 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 SP PLUS CORPORATION Victor Alistar VP of Operations APPROVED AS TO FORM: Jason Johnston Senior Vice President Attachments: EXHIBIT “A”: SCOPE OF SERVICES EXHIBIT “B”: SCHEDULE OF PERFORMANCE EXHIBIT “C”: COMPENSATION EXHIBIT “C-1”: SCHEDULE OF RATES EXHIBIT “D”: INSURANCE REQUIREMENTS DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFF Sandra Lee Assistant City Attorney Ed Shikada DocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 City Manager DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 12 EXHIBIT “A” SCOPE OF SERVICES Project Description CITY is contracting with CONSULTANT to operate the Parking Ambassador Program at multiple public parking facilities in Downtown Palo Alto. CONSULTANT has sufficient experience and knowledge in parking lot operations and was selected through a Request for Proposal selection process as the preferred CONSULTANT for this project. Parking Ambassador Program CONSULTANT will be required to staff a parking facility initially between 9:00 AM and 5:30 PM and guide vehicles with valid Permits issued by CITY to available open parking spaces. As standard marked parking spaces reach capacity CONSULTANT will then be required to guide motorists to parking locations within the drive aisles of the parking garage, issue a Claim Ticket, and take possession of the vehicle until the motorist returns to claim their vehicle. As motorists exit the garage through the course of the day CONSULTANT will be required to move vehicles that block vehicles parked in standard marked spaces and move vehicles parking in the drive aisle in the standard parking marked spaces. CONSULTANT will be required to furnish all signage, kiosks, claim tickets, and lock boxes for vehicle keys, and provide an after-hours contact number for the CONSULTANT so that motorists may contact CONSULTANT to claim their keys during business hours (9:00 AM to 5:30 PM) on weekdays. After the first 90 days of service (referred to as the “initial 90-day monitoring period”), CONSULTANT will attend a meeting with CITY to discuss the program and provide City with a permit utilization report including a detailed expansion plan to Lot S and Lot CW. CITY will evaluate capacity and permit demand, prior to expansion approval. Project Term CONSULTANT will operate every parking facility identified by the CITY using a minimum of two parking ambassadors. CITY shall provide monthly assessments of the program to evaluate the parking ambassador program and CONSULTANT’s operations and performance. Technical Specifications CITY sells 68% additional permits over the available Permit parking supply as usage of the permits varies by season. CONSULTANT will be required to maintain daily reports on the number of vehicles parked within aisles and actively managed by the parking ambassador, time period at which aisle parking begins and relief is observed allowing the parking ambassador to move vehicles back into standard permit parking spaces. CONSULTANT will provide CITY with a report summarizing parking patters. Based on CONSULTANT report, CITY will release additional permits to maximize the parking ambassador program. The parking of vehicles in aisles of the garage will only be permitted with the floors where permit parking is provided. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 13 Lot R Operations CONSULTANT will be required to staff the Lot R parking garage initially between 8:00AM and 6:00PM and guide vehicles with valid Permits issued by CITY to available open parking spaces. As standard marked parking spaces reach capacity CONSULTANT will then be required to guide motorists to parking locations within the driving aisles of the parking garages, issue a Claim Ticket, and take procession of the vehicle until the motorist returns to claim their vehicle. As motorists exit the garage through the course of the day CONSULTANT will be required to move vehicles that block vehicles parked in standard marked spaces and move vehicles parking in the drive aisle into the standard parking marked spaces. . Program Expansion After the initial 90-day monitoring period, CITY may identify Lot S and/or or Lot CW for expansion of the parking ambassador program. Upon direction from CITY to expand the program to an additional lot, CONSULTANT as part of its start-up operations shall prepare a detailed report by CONSULTANT highlighting recommended signage standards, location of signage, any marking improvements. The report shall be submitted to CITY for review and approval a minimum of six weeks prior to the commencement of the parking ambassador operations. CONSULTANT will provide all necessary equipment and supplies for the operations. The report shall also include Standard Operating Procedures (SOPs) on key operations to be defined by CONSULTANT, including but not limited to: Parking Ambassador Program Procedures o Start of Work Day o Break/Lunch o Vehicle Check In o Key Return and Owner Validation o Key Storage and Late Return o Vehicle Storage and Security o Damaged Vehicle Process Facility Security Watch o Report Suspicious Activity/Incidents/Safety Issues Cleanliness o Perform Light Maintenance o Report Property Damage or Vandalism Customer Assistance o Provide General Assistance with Directions and Support o Become Familiar with Transportation Hubs, Downtown Streets, Shopping and Restaurant Options o Troubleshoot Technical Issues on Paystations (Where Applicable) o Answer Questions Regarding Parking Restrictions and Fees o Recommend Long-Term Parking (Annual) Permits o Redirect Vehicles to Another Lot with Available Capacity DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 14 CONSULTANT shall adhere to the Standard Operating Procedures as approved by CITY. CONSULTANT shall also be responsible for procurement of kiosks used by parking attendant, lock boxes, and valet tickets, which shall be reimbursed as a Start Up Cost. Technical details regarding garages provided below. Table 1 Potential Downtown University Avenue Business District Parking Garages Name Previous ID New ID Spaces Cowper/Webster Garage CW A 589 Bryant/Lytton Garage S B 688 Civic Center Garage CC C 692 *High/Alma South Garage R E 211 *Active valet program Table 2 Potential California Avenue Business District Parking Garages/Lots Name ID Spaces Cambridge/Park Lot 1 27 Cambridge/Birch Lot 2 28 Ted Thompson Garage 3 89 Cambridge/Birch Lot 4 28 Cambridge Garage 5 160 Sherman/Park Lot 6 186 Sherman/Birch Lot 7 186 Sherman/Ash Lot 8 147 Birch/Cambridge Lot 9 28 *Sherman/Birch N/A 326 *New parking garage will replace Lot 6 and 7 in 2020 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 15 Additional Requirements and Restrictions CONSULTANT shall provide special event parking services with four (4) weeks advance notice from CITY. CONSULTANT shall provide multi-part claim checks to persons parking in the parking facilities and follow standard operating processes outlined in the Standard Operating Procedures report. CONSULTANT shall provide all necessary equipment and supplies for operations. Use of parking ambassador program shall be free to the public. CONSULTANT is responsible for all auto damage while in possession of a customer’s vehicle. CONSULTANT will file an accident report and respond to claimant within three (3) days of incident. All damage claims must be reported to the CITY including the responsible ambassador and outcome of the claim. CONSULTANT shall notify customers (i.e., on signage and on claim checks issued to customers) that customers must report any damage claims to a parking ambassador prior to exiting the garage. CONSULTANT will not be responsible for citing any vehicles that exceed the set time restrictions. No free parking permits shall be provided to CONSULTANT or its staff. CONSULTANT must supply own parking or promote public transportation. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 16 EXHIBIT “B” SCHEDULE OF PERFORMANCE CONSULTANT shall perform the Services as specified in Exhibit “A” Scope of Services in accordance with a schedule to be determined by CITY. DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 Professional Services Rev. April 27, 2018 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 17 EXHIBIT “C” COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement based on the hourly rate schedule attached as Exhibit C-1. The compensation to be paid to CONSULTANT under this Agreement for all services, additional services, and reimbursable expenses shall not exceed the amount(s) stated in Section 4 of this Agreement. CONSULTANT agrees to complete all Services and Additional Services, including reimbursable expenses, within this/these amount(s). If any regulatory changes, or changes in applicable laws, have a material impact on CONSULTANT’s expenses in performing its obligations under this Agreement, CONSULTANT and CITY agree that the parties will negotiate in good faith equitable adjustments in compensation. 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. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: None All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The 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 expenses, 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: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 EXHIBIT “C-1” SCHEDULE OF RATES CONSULTANT shall be paid hourly for each ambassador or manager providing the Parking Ambassador Program services at CITY parking facilities. Table below includes the payment compensation schedule for the program including pre-defined pricing for expanding services. The compensation table will define the base project fees for the term of the contract. Location Hourly Labor Rate Est. Monthly No. of Employees Monthly cost 2019 2020 2021 Months Annual Cost Months Annual Cost Months Annual Cost Lot R $29.90 151.67 2 $ 9,070 10 $ 177,672 12 $ 108,836 12 $ 108,836 Lot S $29.90 151.67 1 $ 4,535 10 $ 54,418 12 $ 54,418 12 $ 54,418 Lot CW $29.90 151.67 1 $ 4,535 10 $ 54,418 12 $ 54,418 12 $ 54,418 Manager $29.90 43.33 1 $ 1,296 10 $ 12,957 12 $ 15,548 12 $ 15,548 Additional Services 10 $ - 12 $ 65,000 12 $ 65,000 Total Cost Estimates $ 299,465 $ 298,220 $ 298,220 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 1 DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 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 WORKER’S COMPENSATION YES 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. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE AT THE FOLLOWING EMAIL: chris.anastole@Cityofpaloalto.org 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. B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 DocuSign Envelope ID: 04BDBFAF-C810-416A-9F9E-07695A025E03 $6117e69f24da$D06F4D54566641BDB3E627E584935970.docx / 42290 2 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 ENDEAVOR TO 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 ENDEAVOR TO 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: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 Certificate Of Completion Envelope Id: 04BDBFAFC810416A9F9E07695A025E03 Status: Completed Subject: Please DocuSign: C19173514 SP Plus contract for garage management - Transportation (2) Final.docx Source Envelope: Document Pages: 20 Signatures: 3 Envelope Originator: Certificate Pages: 2 Initials: 0 Christopher Anastole AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 chris.anastole@cityofpaloalto.org IP Address: 12.220.157.20 Record Tracking Status: Original 3/1/2019 8:31:01 AM Holder: Christopher Anastole chris.anastole@cityofpaloalto.org Location: DocuSign Security Appliance Status: Connected Pool: City of Palo Alto Storage Appliance Status: Connected Pool: City of Palo Alto Location: DocuSign Victor Alistar valistar@spplus.com VP of Operations Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 99.64.152.217 Sent: 3/1/2019 8:41:50 AM Viewed: 3/1/2019 9:23:57 AM Signed: 3/1/2019 2:12:14 PM Electronic Record and Signature Disclosure: Not Offered via DocuSign Jason Johnston jjohnston@spplus.com Senior Vice President Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 174.194.33.124 Signed using mobile Sent: 3/1/2019 2:12:17 PM Resent: 3/1/2019 5:23:47 PM Viewed: 3/2/2019 3:51:41 AM Signed: 3/2/2019 3:52:12 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Mark Hur Mark.Hur@CityofPaloAlto.org Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 12.220.157.20 Sent: 3/2/2019 3:52:15 AM Viewed: 3/4/2019 11:16:10 AM Signed: 3/4/2019 11:18:48 AM Freeform Signing Electronic Record and Signature Disclosure: Not Offered via DocuSign In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Signer Events Signature Timestamp DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 Madina Klicheva Madina.Klicheva@CityofPaloAlto.org Administrative Associate II City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign Sent: 3/2/2019 3:52:14 AM Notary Events Signature Timestamp Envelope Summary Events Status Timestamps Envelope Sent Certified Delivered Signing Complete Completed Hashed/Encrypted Security Checked Security Checked Security Checked 3/2/2019 3:52:15 AM 3/4/2019 11:16:11 AM 3/4/2019 11:18:48 AM 3/4/2019 11:18:48 AM Payment Events Status Timestamps Carbon Copy Events Status Timestamp DocuSign Envelope ID: D6E37336-D441-4003-A8D3-12AEBEEC8BFFDocuSign Envelope ID: D51D01C4-E9A3-4425-ACE8-A453A7B11406 Certificate Of Completion Envelope Id: D51D01C4E9A34425ACE8A453A7B11406 Status: Completed Subject: Please DocuSign: C19173514 SP Plus contract for garage management Council Approved.pdf Source Envelope: Document Pages: 22 Signatures: 1 Envelope Originator: Certificate Pages: 2 Initials: 0 Christopher Anastole AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 chris.anastole@cityofpaloalto.org IP Address: 12.220.157.20 Record Tracking Status: Original 4/26/2019 9:12:39 AM Holder: Christopher Anastole chris.anastole@cityofpaloalto.org Location: DocuSign Security Appliance Status: Connected Pool: StateLocal Storage Appliance Status: Connected Pool: City of Palo Alto Location: DocuSign Signer Events Signature Timestamp Ed Shikada Ed.Shikada@CityofPaloAlto.org City Manager City of Palo Alto Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 12.220.157.20 Sent: 4/26/2019 9:17:09 AM Viewed: 4/28/2019 8:15:56 AM Signed: 4/28/2019 8:17:00 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign In Person Signer Events Signature Timestamp Editor Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Certified Delivery Events Status Timestamp Carbon Copy Events Status Timestamp Madina Klicheva Madina.Klicheva@CityofPaloAlto.org Administrative Associate II City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 4/28/2019 8:17:02 AM Viewed: 4/29/2019 8:12:55 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Sherry Nikzat Sherry.Nikzat@CityofPaloAlto.org Sr. Management Analyst City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 4/28/2019 8:17:03 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Carbon Copy Events Status Timestamp Irma Mora Irma.Mora@CityofPaloAlto.org Administrative Associate III City of Palo Alto Security Level: Email, Account Authentication (None) Sent: 4/28/2019 8:17:04 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Notary Events Signature Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 4/28/2019 8:17:04 AM Certified Delivered Security Checked 4/28/2019 8:17:04 AM Signing Complete Security Checked 4/28/2019 8:17:04 AM Completed Security Checked 4/28/2019 8:17:04 AM Payment Events Status Timestamps City of Palo Alto (ID # 10658) City Council Staff Report Report Type: Consent Calendar Meeting Date: 10/21/2019 City of Palo Alto Page 1 Council Priority: Fiscal Sustainability Summary Title: Approval of Fiscal Year 2019 Reappropriation Requests to be Carried Forward into Fiscal Year 2020 Title: Approval of Fiscal Year 2019 Reappropriation Requests to be Carried Forward Into Fiscal Year 2020 and Budget Amendments in Various Funds From: City Manager Lead Department: Administrative Services Recommendation Staff recommends that the City Council amend the Fiscal Year 2020 Budget Appropriation Ordinance for various funds as identified in Attachment A, and various capital projects as identified in Attachment B and Attachment C. Background As a part of the fiscal year-end process, staff reviews the City’s unencumbered and unspent appropriations of the fiscal year just ended, along with the City’s spending plans. Encumbered amounts are those subject to the legal claims of other parties due to contractual obligations (for example, commitments made through purchase orders), which are carried forward from one fiscal year to the next. Each year there are a small number of important projects which staff was not able to complete or encumber funds against. The reappropriation process allows staff to bring forward funding recommendations to City Council to continue these projects into the next fiscal year. On September 22, 2014, the City Council approved a recommendation to amend Chapter 2.28, Section 2.28.090 of the Municipal Code, reducing the previous two-step reappropriations process (preliminary and final reappropriation authorization) to one step as long as the Administrative Services Director certifies that sufficient unencumbered and unexpended funds are available in the Fiscal Year that just ended to be carried forward to the subsequent Fiscal Year. Additionally, the City Council amended the Municipal Code to eliminate the provision allowing for the automatic reappropriation of capital project funds. However, capital projects may still City of Palo Alto Page 2 be delayed or deferred for various reasons. Therefore, there remains a need to reappropriate funds for capital projects in some instances. This reappropriation is completed through a review of the status of projects as part of the annual budget process and built into the annual adopted budget. Now that Fiscal Year 2019 has closed and staff has processed necessary accounting transactions, unexpended and unencumbered funds for each capital project have been reviewed one final time. Based on that review, staff recommends capital dollars remaining for some projects in various funds through Fiscal Year 2019 are reappropriated to Fiscal Year 2020. Also, as part of this review, staff realized that for some projects too much funding was recommended for reappropriation as additional expenditures occurred in Fiscal Year 2019. Therefore, this staff report also recommends reversing a portion of previously authorized reappropriations. In a few capital projects, more funding was spent in FY 2019 than was recommended for reappropriation. In these projects, staff is recommending technical clean-up actions to reduce the funds appropriated in FY 2020 in order to increase the funding appropriated in FY 2019 while maintaining the overall total project budget. Discussion Attachment A identifies those operating budget requests that staff recommends for approval, while Attachment B lists recommended capital project requests. Attachment C includes the recommended technical clean-up items for a few capital projects. With the submission of this report for City Council consideration, the Administrative Services Director certifies sufficient unencumbered and unexpended funds are available from Fiscal Year 2019 to be reappropriated to Fiscal Year 2020. Operating Budget Reappropriations The projects recommended for budget reappropriations are outlined in more detail in Attachment A and can generally be grouped into the following categories: • Timing and Workload Delays: Projects in this category were delayed due to competing workload demands, appropriation of funds late in the fiscal year, or other unanticipated delays. Examples of projects in this category include: Special Funds Assessment Program ($50,000), Sea Level Rise Adaptation Plan ($200,000), GEMT Quality Assurance Fee Program ($50,000 in both expense and revenue), Labor Negotiation Contract Services ($20,000), Sea Scout operations ($65,000) and California Avenue Parking Valet Services ($150,000). • Technology Services: Projects in this category include approved technology system evaluation and upgrades where the associated contracts were not awarded before the end of the fiscal year: Geographical Information System (GIS) Modernization Project ($700,000), SharePoint Training Academy ($50,000), Police Public Safety Server Replacement ($27,500), and Planning and Development Services Technology Enhancements ($23,959). City of Palo Alto Page 3 • Human Services Resource Allocation Process (HSRAP) Reserve: As part of the FY 2015 Adopted Budget, the City Council established a one-time reserve of $50,000 for HSRAP funding requests. In FY 2019, $10,000 was allocated to Heart and Home Collaborative, a non-profit organization that provides shelter and services to unhoused women in Palo Alto. The remaining balance of $40,000 is recommended to be reappropriated to FY 2020. • Think Fund Teen Services Programs (formerly Bryant Street Garage Teen Program): In 2001, the City Council voted to lease out a garage property located at 455 Bryant Street. Since this site was formerly the location of the Bryant Street Teen Center, a stipulation in the lease required that seventy five percent of the rental revenues would be used to fund programs specifically for Palo Alto youth and teens. In prior years, Staff has returned the Policy and Services Committee and City Council for guidance on community engagement and potential uses of this funding (CMR 4776, CMR 8887). Teen Services programs include but are not limited to: Think Fund grants, ClickPA website, Teen Arts Council, MakeX, Art Center, Think Fund Gala, and the Buoyancy Teen Festival. The unspent balance of $351,000 is recommended to be reappropriated to FY 2020 to ensure resources are available to continue providing teen services to the community and develop a long‐term approach to maintain delivery of these services. • Multi-year Funding Agreements: Projects in this category include approved donations, grants, loans, and other funding agreements that are anticipated to continue in the coming year. Examples in this category include: Palo Alto Library Foundation Grant for Training and Customer Service ($18,000), Palo Alto Library Partnership Grant for Cybersecurity Training ($29,635), Art Center Ceramics Studio Bequest for Equipment Repairs ($37,581), Palo Alto Housing Corporation Loan for Affordable Housing at 3705 El Camino Real ($10.0 million) and El Dorado ($225,032), North Ventura Grant and Sobrato Funding Agreement for the North Ventura Coordinated Area Plan ($20,515), and an Agreement with the County of Santa Clara for Street Intersection Improvements at Page Mill Road and El Camino Real/Hanover ($2.2 million). • Management Training Program: The Management Training Program provides $1,000 per eligible employee under the terms outlined in the MGMT and PAPMA labor agreements. The purpose of this program is to provide employees with resources to improve and supplement their job and professional skills. In total, $385,000 in unused funding is requested to be reappropriated to FY 2020 for various training programs, including: ethics, civics and citizen engagement, leadership and management, budget, finance, procurement, interpersonal communication, presentation skills, business writing, time management, project management, change management, online based education, and safety & security. City of Palo Alto Page 4 Capital Budget Reappropriations As discussed in the Background section of this report, starting with the Fiscal Year 2016 capital budget, all capital project reappropriations require City Council approval. The FY 2020 Adopted Budget included $71.4 million in reappropriated expenditure funds, partially offset by $21.3 in reappropriated revenue, across all City funds based on estimates of anticipated spending and revenue collections in FY 2019. Since the adoption of the capital budget, some adjustments and refinements to project reappropriations are required since FY 2019 year-end actuals and projects costs have been updated to reflect actual experience. These primarily reflect either increases or decreases to assumed reappropriations in the FY 2020 Adopted Budget: • Additional reappropriations are recommended when project expenditures originally anticipated to occur before the end of FY 2019 will now likely occur in FY 2020. Similarly, revenue that was anticipated to be collected in FY 2019 will be reappropriated to FY 2020 to align with the actual collections; • Downward adjustments to reappropriations are recommended when expenses were not anticipated to occur until FY 2020 and funding was reappropriated in the budget document to FY 2020. However, the expenses were realized in FY 2019, so an adjustment to reduce the budgeted reappropriation is needed because the activity no longer needs funding in FY 2020. The reappropriation of revenue is treated similarly; if it was assumed revenue would not be collected in FY 2019 and was reappropriated to FY 2020 an adjustment to reduce the reappropriated revenue is needed to align collections in the appropriate fiscal year. Table 1 summarizes the recommended net adjustments as detailed in Attachment B. These Fiscal Year 2020 adjustments represent the final step in the City Council-approved change to the reappropriation process. There are sufficient expenditure savings in Fiscal Year 2019 to support all recommended adjustments. It should be noted that the revised process and active review of all project reappropriations results in a reduced level of reappropriated funding from one year to the next, compared to the process of automatically reappropriating unspent capital funding, better reflecting the needs of the various capital projects and of the overall program. City of Palo Alto Page 5 Table 1: Year-End Capital Project Reappropriation Summary – By Fund Fund Number of Projects Recommended Revenue Reappropriation Adjustment Recommended Expense Reappropriation Adjustment Capital Improvement Fund 51 $4,478,661 $6,926,600 Airport Fund 1 $10,714,400 $ 0 Electric Fund 16 $ 0 $(1,804,100) Gas Fund 3 $ 0 $517,100 Storm Drainage Fund 2 $ 0 $750,900 Wastewater Collection Fund 3 $ 0 $403,300 Wastewater Treatment Fund 3 $ 0 $4,214,200 Water Fund 4 $ 0 $1,639,700 Technology Fund 3 $ 0 $(29,700) Vehicle Replacement and Maintenance Fund 3 $ 0 $(256,200) Total All Funds 89 $15,193,061 $12,361,800 Technical Clean-up Actions As detailed in Attachment C, there were four capital projects in the Capital Improvement Fund that were overspent in FY 2019 by a total of $680,400; they did not have funding reappropriated from FY 2019 to FY 2020 as part of the FY 2020 budget process. In order to fund the overages for these projects in FY 2019 and maintain the projects’ total budgets over the life of the projects, staff is recommending technical clean-up actions to reduce the funds appropriated in FY 2020 for these projects by $680,400 in order to shift the funding back into FY 2019. This would align the budget by year with the actual expenses by year. In addition, as part of the Adopted FY 2020 Capital Budget, it was estimated that $3.0 million would be encumbered for the New Public Safety Building project (PE-15001) in FY 2019. However, this contract was unable to be completed before the end of FY 2019, so $3.0 million is recommended to be appropriated to this project in FY 2020 in order to maintain the total approved project budget of $115.5 million. In total, $2.3 million in technical clean-up actions are recommended in FY 2020 and corresponding adjustments will be done in FY 2019 as part of the FY 2019 Year-End clean-up process (currently scheduled for review by the Finance Committee on November 19, 2019) in order to maintain the projects’ total budgets over the life of the projects. See Attachment C for further detail on these projects. Resource Impact All projects, programs and corresponding funding contained within this report were previously approved by the City Council for FY 2019, this report simply realigns funding between fiscal years to align with the status of projects and programs. The Director of Administrative Services City of Palo Alto Page 6 has certified that sufficient funds exist for the recommended Fiscal Year 2019 Operating Budget adjustments (Attachment A), and Capital Budget adjustments (Attachment B and Attachment C). For Operating reappropriations, staff recommends expense reappropriations of $1.2 million in the General Fund, $12.6 million in Special Revenue Funds, $0.5 million in Enterprise Funds, and $0.8 million in Internal Service Funds. Additionally, staff recommends revenue reappropriations of $0.08 million in the General Fund. For capital projects, staff recommends a net $9.2 million in expenses be reappropriated to FY 2020 in the Capital Improvement Funds and that $4.5 million in revenue be reappropriated. Also recommended is a net $5.7 million increase in expenditures in the various Enterprise Funds with reappropriated revenue of $10.7 million, and a net reduction of $0.3 million in expenditures in the Internal Service Funds. The results of the reappropriations and technical clean-up actions will have a net zero impact to the total projects’ budgets over the life of the projects. Policy Implications This recommendation is consistent with adopted Council policy. Environmental Review The action recommended is not a project for the purposes of the California Environmental Quality Act. Attachments: • Attachment A - FY 2019 Reappropriation Requests • Attachment B - FY 2019 Capital Improvement Program (CIP) Reappropriations • Attachment C - FY 2020 Technical Clean Up Items FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation General Fund Administrative Services Special Funds Assessment Program This action reappropriates funding to develop a special funds assessment program. The program aligns with the City Council's Fiscal Sustainability Policy (CMR 10267) and will use consultancy services to conduct an assessment of three Special Funds, including the review of reserve levels, identification of best practices related to authorizations, and review of internal controls over each fund. Additionally, the consultant will provide “real time” training to City staff to facilitate continued assessments of the City’s Funds in the future by City staff. The solicitation and selection of the contract were not completed prior to the end of FY 2019, this action ensures sufficient funding is available to award the contract in FY 2020. $ ‐ $ 50,000 General Fund City Manager/Office of Sustainability Sea Level Rise Adaptation Plan This action reappropriates funding for the development of a Sea Level Rise Adaptation Plan. On March 18, 2019 the City Council accepted the Sea Level Rise Policy and directed staff to return to Council with a Sea Level Rise Adaptation Plan by December 2020 (CMR 9576). The plan aligns with the City Council’s Climate Change priority, and will serve as the Sustainability and Climate Action Plan (S/CAP) Sea Level Rise chapter. Staff’s preliminary estimate is a one‐time cost of $275,000 for development of the Seal Level Rise Adaptation Plan including an initial Vulnerability Assessment and will be jointly funded by the Wastewater Treatment Fund Watershed Protection Group ($150,000), the City Manager's Office ($50,000), and the Utilities Department ($75,000). Due to delays in contract solicitation and selection, the process to award a contract was not completed in FY 2019. A total of $200,000 is recommended for reappropriation in the Wastewater Treatment Fund and City Manager's Office in FY 2020. The Utilities Department has sufficient funding available in FY 2020 to support this cost and does not require a reappropriation. $ ‐ $ 50,000 Page 1 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation General Fund Community Services Think Fund Teen Services (Formerly Bryant Street Garage Teen Program) This action reappropriates funds in the Think Fund (formerly the Bryant Street Garage Teen Program). In 2001, the City Council voted to lease out a garage property located at 455 Bryant Street. Since this site was formerly the location of the Bryant Street Teen Center, a stipulation in the lease required that seventy five percent of the rental revenues would be used to fund programs specifically for Palo Alto youth and teens. In prior years, Staff has returned the Policy and Services Committee and City Council for guidance on community engagement and potential uses of this funding (CMR 4776, CMR 8887). Teen Services programs include but are not limited to: Think Fund grants, ClickPA website, Teen Arts Council, MakeX, Art Center, Think Fund Gala and the Buoyancy Teen Festival. This action will reappropriate $351,000, including $338,500 previously reappropriated from FY 2018 to FY 2019, a to ensure resources are available to continue providing quality teen services to the community and develop a long‐term approach to maintain delivery of these services. $ ‐ $ 351,000 General Fund Community Services Human Services Resource Allocation Program (HSRAP) Reserve This action reappropriates the remaining balance in the Human Services Resource Allocation Program (HSRAP) Reserve. As part of the FY 2015 Adopted Budget, the City Council established a one‐time reserve of $50,000 for HSRAP funding requests. In FY 2019, $10,000 was allocated to Heart and Home Collaborative, a non‐profit organization that provides shelter and services to unhoused women in Palo Alto. The remaining balance of $40,000 is recommended to be reappropriated to FY 2020 for future HSRAP use. $ ‐ $ 40,000 General Fund Community Services Art Center Ceramics Studio Bequest This action reappropriates a bequest from the Sherrie Innis Estate. On June 19, 2017, the City Council approved a bequest of $54,350 from the Sherrie Innis Estate to maintain and upgrade the ceramic studio at the Palo Alto Art Center (CMR 8187). The ceramics studio maintains kilns, wheels, and several other large pieces of equipment that will need repair or replacement in the near future. The program does not have funding appropriated for major repairs and replacements and uses the bequest for these needs. At the close of FY 2019, $37,581 remained unspent and is recommended to be reappropriated for repair and replacement needs in FY 2020. $ ‐ $ 37,581 Page 2 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation General Fund Fire Ground Emergency Medical Transports (GEMT) Quality Assurance Fee (QAF) This action reappropriates funding for the State GEMT QAF Program. The QAF program is mandatory under SB523 and levies a fee on ground emergency transports to fund and provide reimbursement for Medi‐Cal transports. This program was approved late in FY 2019 with an effective date retroactive to July 1, 2018; therefore, funding to support this program was not included in the FY 2019 Budget. The Fire Department utilized savings in FY 2019 to pay invoices for the last two quarters of CY 2018, this action ensures sufficient funding is available in FY 2020 for payment of the first two quarters of CY 2019. With the payment of these invoices, the City will be current on all retroactive charges. Funding for the QAF Program has been included on an ongoing basis in the FY 2020 Adopted Budget at an anticipated amount of $100,000 annually. $ 50,000 $ 50,000 General Fund Human Resources Labor Negotiation Contractual Support This action reappropriates funding for the Utilities Management and Professional Association of Palo Alto (UMPAPA) and Management and Professional (MGMT) labor negotiations. In FY 2018, $100,000 in one‐time funding was appropriated for labor negotiations of contracts nearing expiration. At the close of FY 2019, the City reached agreements with all seven represented units; however, the UMPAPA and Management and Professional agreements were only extended for a one‐year term ending on June 30, 2020 (CMR 10326, CMR 10488). This action ensures that sufficient funding is available for outside counsel, salary surveys, and other expenses expected in upcoming labor negotiations in FY 2020. $ ‐ $ 20,000 General Fund Library Palo Alto Library Foundation Donation for Training and Customer Service This action reappropriates Palo Alto Library Foundation donation funds for training and customer service. In June 2015, Council approved a $320,000 donation from the Palo Alto Library Foundation for technology and services to improve workflow efficiency, provide staff training, and provide customer service improvements (CMR 6343). The Library has utilized this funding for the purchase of additional technology, such as tablets, e‐ readers, and other devices for staff development and customer instruction; databases for digital services; and contractual services to improve workflow efficiency, staffing training, and customer service improvements for new facilities and products. This action ensures that the unspent donation balance is available to continue staff training and development efforts in FY 2020. $ ‐ $ 18,000 Page 3 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation General Fund Library Palo Alto Library Partnership (PLP) Grant for Cybersecurity Training This action reappropriates grant funds from the Palo Alto Library Partnership (PLP) for cybersecurity training. On February 4, 2019 the City Council approved a $39,000 grant from the PLP for Cybersecurity Training for Youth using Minecraft, aka Minecraft Project (CMR 9946). Using gamification, this project will teach cybersecurity to youth through the creation of an interactive, vendor neutral cybersecurity learning platform in the videogame Minecraft. Funds from this grant are used to cover the costs of staff hours to create the program. Due to delays in the timeline, the Minecraft Project was not completed prior to the end of FY 2019. This action ensures that the unspent grant balance is available to complete the project in FY 2020. $ 29,635 $ 29,635 General Fund Non‐Departmental City Council Contingency for Sea Scouts This action reappropriates funding from the City Council Contingency for Sea Scouts. On December 17, 2018 the City Council approved the transfer of $665,000 of Sea Scout Building Transferable Development Rights (TDRs) proceeds to the Roth Building Rehabilitation project (CMR 9767). In addition, the City Council appropriated $65,000 (ten percent of the TDR transfer) from the City Council Contingency to fund Sea Scout operating and maintenance costs. As part of this action, Staff was directed to return to the City Council with a recommendation to dedicate this funding. Staff anticipates returning to the City Council with that recommendation in FY 2020. This action ensures that funds will be available to appropriate to the Sea Scouts in FY 2020. $ ‐ $ 65,000 General Fund Non‐Departmental Management Training Program This action reappropriates funding for management training and professional development. The Management Training Program provides $1,000 per eligible employee under the terms outlined in the labor agreements with the Management and Professional group and the Palo Alto Police Management Association. The purpose of this program is to provide employees with resources to improve and supplement their job and professional skills. In total, $305,000 of this funding was reappropriated from the prior year and an additional savings of $80,000 was realized in FY 2019 across departments in the General Fund. This action is recommended for the continuation of the program and will include the following training programs: ethics, civics and citizen engagement, leadership and management, budget, finance, procurement, interpersonal communication, presentation skills, business writing, time management, project management, change management, online based education, and safety & security. $ ‐ $ 385,000 Page 4 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation General Fund Planning and Development Services North Ventura Grant and Sobrato Funding Agreement: North Ventura Coordinated Area Plan (NVCAP) This action reappropriates funding from the North Ventura Grant and Sobrato for the North Ventura Coordinated Area Plan (NVCAP). In total, $888,000 was appropriated on March 5, 2018 to the Planning and Development Services Department for the development of coordinated area plans that will guide development of the North Ventura area and the completion of the associated environmental clearance (CMR 8986). The Department initiated the procurement process for this project, including consultancy services to assist staff with the planning and urban design of the area, and a feasibility analysis to integrate Matadero Creek into an open space area within the NVCAP project boundary. At the close of FY 2019, $20,815 of this funding remains unspent and is recommended to be reappropriated for public outreach and other work obligated under the funding agreement in FY 2020. $ ‐ $ 20,815 General Fund Police Department Police Department Server Replacement This action reappropriates funding for the purchase and replacement of two servers. The current servers are well beyond their useful life and are necessary to host the network infrastructure and operational databases for criminal investigations, field operations, and parking enforcement managed by the Police Department. The total estimated cost is $39,500, and will be jointly funded by the Information Technology Department ($27,500) and the Police Department ($12,000). The solicitation and selection of the contract were not completed prior to the end of FY 2019, this action ensures sufficient funding is available to award the contract in FY 2020. $ ‐ $ 12,000 General Fund Public Works Department Urban Forestry Technology Implementation This action reappropriates funding for Urban Forestry Master Plan (UFMP) projects. On May 11, 2015, the City Council approved the UFMP to guide the future of the City's urban forest over a ten year phased implementation period (CMR 5554). Year 4 projects (FY 2019) focused on technology enhancement programs such as a tree canopy cover tool, inventory systems integration, and public facing data portals. However, these project are dependent on the implementation of the new Environmental Systems Research Institute (ESRI) enterprise Geographic Information System (GIS) which was not completed in FY 2019. Due to delays with the ESRI GIS implementation, the department was unable to complete Year 4 projects. This action ensures sufficient funding is available to complete those projects in FY 2020. $ ‐ $ 100,000 Total General Fund Reappropriation 79,635$ 1,229,031$ Page 5 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation Traffic Impact Fund: Stanford Research Park and El Camino Real City Manager/Office of Transportation County of Santa Clara Agreement: Page Mill Road and El Camino Real/Hanover Street Intersection Improvements This action reappropriates funding for an agreement with the County of Santa Clara to improve intersections on Page Mill Road. In total, $3.2 million was approved by the City Council on August 28, 2017 for improvements at the intersections of Page Mill Road at El Camino Real and Page Mill Road at Hanover Street to improve operations for bicyclists, pedestrians, and efficiency of vehicular operations (CMR 7990). Under the terms of the agreement, the City is to provide funding in two stages; first for the pre‐construction costs, and second for construction costs. In 2018, the City paid $1.0 million for pre‐construction costs that included project design, environmental review, and permitting. The remaining $2.2 million is recommended to be reappropriated for construction costs in FY 2020. $ ‐ $ 2,200,000 California Avenue Parking Permit Fund City Manager/Office of Transportation Temporary Valet Parking Services ‐ California Avenue Parking Garage This action reappropriates funding for valet parking services during construction of the new California Avenue parking garage. In FY 2019, a total of $150,000 was appropriated for temporary valet services to offset lost parking spaces during garage construction. Due to construction delays, this funding remained unspent in FY 2019. This action ensures that sufficient funding is available to support valet services in FY 2020. $ ‐ $ 150,000 Housing In‐Lieu Fund: Commercial Planning and Development Services PAHC Affordable Housing Loan Agreement: 3705 El Camino Real (Wilton Court) This action reappropriates funding for an agreement with the Palo Alto Housing Corporation (PAHC) to develop and construct an 100% affordable housing project at 3705 El Camino Real (Wilton Court). In total, $10.0 million was approved by the City Council at the June 3, 2019 meeting (CMR 10143); $9.0 million from the Commercial Housing Fund and $1.0 million from the Residential Housing Fund. Due to the limited timeframe between City Council approval and the close of the fiscal year, no expenses were incurred in FY 2019. The full $10.0 million is recommended to be reappropriated to continue the project in FY 2020. $ ‐ $ 9,000,000 Page 6 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation Housing In‐Lieu Fund: Residential Planning and Development Services PAHC Affordable Housing Loan Agreement: 3705 El Camino Real (Wilton Court) This action reappropriates funding for an agreement with the Palo Alto Housing Corporation (PAHC) to develop and construct an 100% affordable housing project at 3705 El Camino Real (Wilton Court). In total, $10.0 million was approved by the City Council at the June 3, 2019 meeting (CMR 10143); $1.0 million from the Residential Housing Fund and $9.0 million from the Commercial Housing Fund. Due to the limited timeframe between City Council approval and the close of the fiscal year, no expenses were incurred in FY 2019. The full $10.0 million is recommended to be reappropriated to continue the project in FY 2020. $ 1,000,000 Housing In‐Lieu Fund: Residential Planning and Development Services PAHC Affordable Housing Loan Agreement: El Dorado This action reappropriates funding for the El Dorado affordable housing agreement. In total, $375,000 was approved by the City Council on June 22, 2015 for the Palo Alto Housing Corporation (PAHC) to deed restrict and rehabilitate property at 110‐1030 El Dorado Avenue (CMR 5712). The deed restriction ensures that the three units on this property are leased only to qualifying low income households. At the close of FY 2019, PAHC had drawn down a total of $149,968. This action ensures that the unspent balance is available to continue the rehabilitation of the properties in FY 2020. $ ‐ $ 225,032 ‐$ 12,575,032$ Total Special Revenue Fund Reappropriation Page 7 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation Wastewater Treatment Fund Public Works Sea Level Rise Adaptation Plan This action reappropriates funding for the development of a Sea Level Rise Adaptation Plan. On March 18, 2019 the City Council accepted the Sea Level Rise Policy and directed staff to return to Council with a Sea Level Rise Adaptation Plan by December 2020 (CMR 9576). The plan aligns with the City Council’s Climate Change priority, and will serve as the Sustainability and Climate Action Plan (S/CAP) Sea Level Rise chapter. Staff’s preliminary estimate is a one‐time cost of $275,000 for development of the Seal Level Rise Adaptation Plan including an initial Vulnerability Assessment and will be jointly funded by the Wastewater Treatment Fund Watershed Protection Group ($150,000), the City Manager's Office ($50,000), and the Utilities Department ($75,000). Due to delays in contract solicitation and selection, the process to award a contract was not completed in FY 2019. A total of $200,000 is recommended for reappropriation in the Wastewater Treatment Fund and City Manager's Office in FY 2020. The Utilities Department has sufficient funding available in FY 2020 to support this cost and does not require a reappropriation. $ ‐ $ 150,000 Stormwater Management Fund Public Works Green Stormwater Infrastructure Technical Support This action reappropriates funding for the Green Stormwater Infrastructure (GSI) Plan. The GSI Plan was accepted by the City Council at the May 13, 2019 meeting to comply with the State's Municipal Regional Stormwater National Pollutant Discharge Elimination System (MRP) Permit and outline a plan to integrate GSI features into the City's urban landscapes and stormwater systems (CMR 9883). As part of this plan, consultancy services will be used to develop an Engineering Specifications document for citywide GSI standards and a GSI Maintenance and Monitoring Manual. The solicitation and selection of the vendors were not completed prior to the end of FY 2019, this action ensures sufficient funding is available to award the contracts in FY 2020. $ ‐ $ 115,000 Water Fund Utilities Santa Clara Valley Water District (SCVWD) Agreement: Baron Creek Contract Lining Repair This action reappropriates funding for an agreement with Santa Clara Valley Water District (SCVWD) to repair the creek bottom concrete slab along Barron Creek at the crossing of Bryant Street. The need for repair resulted from a ruptured water line that damaged the concrete liner in the creek bed. The agreement with SCVWD for this project was approved by the City Council at the June 24, 2019 meeting (CMR 10387); however, the procurement process was not completed due to the limited timeframe between City Council approval and the close of the fiscal year. This action ensures that funding is available to complete the project in FY 2020. $ ‐ $ 258,450 $ ‐ $ 523,450 Total Enterprise Fund Reappropriation Page 8 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation Technology Fund Information Technology Geographical Information System (GIS) Modernization Project This action reappropriates funding for the Geographical Information System (GIS) Modernization Project. As part of the FY 2018 Adopted Budget, a total of $750,000 was appropriated for advanced GIS mapping tools that capture, store, manipulate, analyze, manage, and present spatial or geographic data. The Department selected Esri as the new GIS vendor and spent $50,000 to acquire the new Esri platform. This is a multi‐year project with many components and a full integration anticipated in FY 2021. This action ensures that remaining funding is available to continue the project in FY 2020. $ ‐ $ 700,000 Technology Fund Information Technology SharePoint Training Academy This action reappropriates funding to establish a training solution for the deployment of SharePoint (City Center 2). The SharePoint Academy provides a framework for understanding SharePoint features, functions, administration, and collaboration. This course will provide attendees with professionally delivered training classes. Funding was initially appropriated as part of the FY 2018 Adopted Budget and due to other competing priorities the Department extended the anticipated timeline. This action ensures that sufficient funding is available to complete the project in FY 2020. $ ‐ $ 50,000 Technology Fund Information Technology Police Department Server Replacement This action reappropriates funding for the purchase and replacement of two servers. The current servers are well beyond their useful life and are necessary to host the network infrastructure and operational databases for criminal investigations, field operations, and parking enforcement managed by the Police Department. The total estimated cost is $39,500, and will be jointly funded by the Information Technology Department ($27,500) and the Police Department ($12,000). The solicitation and selection of the contract were not completed prior to the end of FY 2019, this action ensures sufficient funding is available to award the contract in FY 2020. $ ‐ $ 27,500 Page 9 of 10 FY 2019 TO FY 2020 OPERATING BUDGET REAPPROPRIATIONS ATTACHMENT A Fund Name Department Title Description Recommended Revenue Appropriation Recommended Expense Appropriation Technology Fund Information Technology Planning and Development Services Technology Enhancements This action reappropriates funding for various technology projects in the Planning and Development Services department. As part of the FY 2019 Adopted Budget and Municipal Fee Schedule, a three percent increase to Planning fees was recommended to recover $75,000 for ongoing technical support of the City's centralized permitting system (Accela) and other technological enhancements. Current priorities include various Graphical Information System (GIS) projects and the migration of department specific workflows, reporting, and integrations from the Geodesy system to the new ESRI GIS platform. At the close of FY 2019, $23,959 of this funding remains unspent and is recommended to be reappropriated for planned projects in FY 2020. $ ‐ $ 23,959 Total Internal Service Fund Reappropriation ‐$ 801,459$ Total All Funds 79,635$ 15,128,972$ Page 10 of 10 FY 2019 to FY 2020 Capital Project Reappropriations ATTACHMENT B Project ID Project Title Fund Revenue Reappropriation Adjustment Expense Reappropriation Adjustment AC‐18001 JMZ Renovation Capital Improvement Fund 240,200$ 269,100$ AC‐86017 Art In Public Spaces Capital Improvement Fund ‐$ 247,000$ CB‐16001 Cubberley Community Center Master Plan Capital Improvement Fund ‐$ (155,100)$ CB‐16002 Cubberley Roof Replacements Capital Improvement Fund ‐$ (10,500)$ CB‐17001 Cubberley Repairs Capital Improvement Fund ‐$ (12,300)$ CB‐17002 Cubberley Field Restroom Capital Improvement Fund ‐$ 238,400$ CB‐19000 Cubberley Track and Field Replacement Capital Improvement Fund ‐$ (11,300)$ FD‐14002 Fire Ringdown System Replacement Capital Improvement Fund‐$ (46,700)$ OS‐00001 Open Space Trails and Amenities Capital Improvement Fund ‐$ (41,000)$ OS‐00002 Open Space Lakes And Pond Maintenance Capital Improvement Fund ‐$ 48,800$ PE‐09003 City Facility Parking Lot Maintenance Capital Improvement Fund ‐$ 10,100$ PE‐11011 Highway 101 Pedestrian/Bicycle Overpass Project Capital Improvement Fund 650,000$ 1,693,400$ PE‐12011 Newell Road/San Francisquito Creek Bridge Replacement Capital Improvement Fund 100,200$ 126,400$ PE‐12017 City Hall First Floor Renovations Capital Improvement Fund ‐$ 188,400$ PE‐13011 Charleston/Arastradero Corridor Project Capital Improvement Fund (314,319)$ ‐$ PE‐14018 Baylands Boardwalk Improvements Capital Improvement Fund ‐$ 22,200$ PE‐15011 Ventura Buildings Improvements Capital Improvement Fund ‐$ (2,000)$ PE‐15020 Civic Center Waterproofing Study and Repairs Capital Improvement Fund ‐$ 49,400$ PE‐17009 City Hall Floor 5 Remodel Capital Improvement Fund ‐$ 32,000$ PE‐17010 Civic Center Electrical Upgrade & EV Charger Installation Capital Improvement Fund 203,000$ 41,800$ PE‐18000 New California Avenue Area Parking Garage Capital Improvement Fund ‐$ 1,201,800$ PE‐18002 High and Bryant Street Garages Waterproofing and Repairs Capital Improvement Fund ‐$ (9,000)$ PE‐18006 Byxbee Park Completion Capital Improvement Fund ‐$ 214,600$ PE‐19001 Water, Gas, Wastewater Office Remodel Capital Improvement Fund ‐$ (3,300)$ PE‐19002 Animal Shelter Renovation Capital Improvement Fund ‐$ 188,700$ PE‐86070 Street Maintenance Capital Improvement Fund (76,020)$ 549,400$ PF‐00006 Roofing Replacement Capital Improvement Fund ‐$ 36,100$ PF‐02022 Facility Interior Finishes Replacement Capital Improvement Fund ‐$ (1,200)$ PF‐14002 Fire Station 1 Improvements Capital Improvement Fund ‐$ 28,800$ PF‐14003 University Avenue Parking Improvements Capital Improvement Fund ‐$ 345,100$ PF‐16003 Charleston/Arastradero Corridor Project Capital Improvement Fund 25,600$ ‐$ PF‐93009 Americans With Disabilities Act Compliance Capital Improvement Fund ‐$ (4,800)$ PG‐06001 Athletic Courts Resurfacing Capital Improvement Fund ‐$ 12,200$ PG‐13003 Golf Reconfiguration & Baylands Athletic Center Improvements Capital Improvement Fund 2,250,000$ 408,500$ PG‐17000 Baylands Comprehensive Conservation Plan Capital Improvement Fund ‐$ 6,500$ PG‐19001 Baylands Athletic Center 10.5 Acre Expansion Plan Capital Improvement Fund ‐$ (5,900)$ Page 1 of 3 FY 2019 to FY 2020 Capital Project Reappropriations ATTACHMENT B Project ID Project Title Fund Revenue Reappropriation Adjustment Expense Reappropriation Adjustment PL‐00026 Safe Routes To School Capital Improvement Fund ‐$ 8,100$ PL‐04010 Bicycle and Pedestrian Transportation Plan Implementation Capital Improvement Fund ‐$ 231,200$ PL‐05030 Traffic Signal and Intelligent Transportation Systems Capital Improvement Fund 400,000$ 104,700$ PL‐14000 Churchill Avenue Enhanced Bikeway Capital Improvement Fund ‐$ 57,400$ PL‐14001 Midtown Connector Capital Improvement Fund ‐$ 53,100$ PL‐15002 Downtown Automated Parking Guidance Systems, Access Controls & Revenue Collection Equip. Capital Improvement Fund ‐$ 130,400$ PL‐15003 Parking District Implementation Capital Improvement Fund ‐$ 118,100$ PL‐15004 Downtown Parking Wayfinding Capital Improvement Fund ‐$ 20,100$ PL‐16001 Downtown Mobility and Safety Improvements Capital Improvement Fund ‐$ 25,700$ PL‐17001 Railroad Grade Separation and Safety Improvements Capital Improvement Fund 1,000,000$ 70,800$ PL‐19000 Emergency Vehicle Traffic Signal Preemption System Pilot Capital Improvement Fund ‐$ 597,500$ PO‐05054 Street Lights Improvements Capital Improvement Fund ‐$ (29,800)$ PO‐11000 Sign Reflectivity Upgrade Capital Improvement Fund ‐$ 57,200$ PO‐12001 Curb and Gutter Repairs Capital Improvement Fund ‐$ (95,900)$ PO‐89003 Sidewalk Repairs Capital Improvement Fund ‐$ (77,600)$ AP‐16000 Airport Apron Reconstruction Airport 10,714,400$ ‐$ EL‐02011 Electric Utility Geographic Information System Electric ‐$ (1,700)$ EL‐11010 Underground District 47‐Middlefield, Homer, Webster, Addison Electric ‐$ (13,200)$ EL‐12001 Underground District 46 ‐ Charleston/El Camino Real Electric ‐$ 420,200$ EL‐14002 Rebuild Underground District 20 Electric ‐$ (130,000)$ EL‐14005 Reconfigure Quarry Feeders Electric ‐$ (26,100)$ EL‐15000 Colorado/Hopkins System Improvement Electric ‐$ (50,000)$ EL‐16000 Rebuild Underground District 26 Electric ‐$ (3,500)$ EL‐16002 Capacitor Bank Installation Electric ‐$ (163,700)$ EL‐17000 Rebuild Underground District 23 Electric ‐$ (50,000)$ EL‐17005 Inter‐substation Line Protection Relay Electric ‐$ (1,400)$ EL‐17007 Facility Relocation for Caltrain Modernization Project Electric ‐$ (1,048,000)$ EL‐19000 Rebuild Underground District 25 Electric ‐$ (7,400)$ EL‐19001 Colorado Power Station Equipment Upgrades Electric ‐$ (537,500)$ EL‐19003 Rebuild Underground District 30 Electric ‐$ (50,000)$ EL‐89038 Substation Protection Improvements Electric ‐$ (93,000)$ EL‐89044 Substation Facility Improvements Electric ‐$ (48,800)$ GS‐12001 Gas Main Replacement ‐ Project 22 Gas ‐$ 65,300$ GS‐13001 Gas Main Replacement ‐ Project 23 Gas ‐$ 59,700$ GS‐18000 Gas ABS/Tenite Replacement Project Gas ‐$ 392,100$ Page 2 of 3 FY 2019 to FY 2020 Capital Project Reappropriations ATTACHMENT B Project ID Project Title Fund Revenue Reappropriation Adjustment Expense Reappropriation Adjustment SD‐06101 Storm Drainage System Replacement And Rehabilitation Stormwater ‐$ 455,000$ SD‐19000 Loma Verde Avenue Trunk Line Improvements Stormwater ‐$ 295,900$ WC‐15001 Wastewater Collection System Rehabilitation/Augmentation Project 28 Wastewater Collection ‐$ 573,300$ WC‐16001 Wastewater Collection System Rehabilitation/Augmentation Project 29 Wastewater Collection ‐$ (73,500)$ WC‐99013 Sewer Lateral/Manhole Rehabilitation and Replacement Wastewater Collection ‐$ (96,500)$ WQ‐14001 Dewatering and Loadout Facility Wastewater Treatment ‐$ 60,700$ WQ‐14003 Primary Sedimentation Tank Rehabilitation Wastewater Treatment ‐$ 2,086,800$ WQ‐19002 Plant Repair, Retrofit, and Equipment Replacement Wastewater Treatment ‐$ 2,066,700$ WS‐07000 Water Regulation Station Improvements Water ‐$ 797,100$ WS‐12001 Water Main Replacement ‐ Project 26 Water ‐$ 305,400$ WS‐13001 Water Main Replacement ‐ Project 27 Water ‐$ 569,500$ WS‐80015 Water Meters Water ‐$ (32,300)$ TE‐05000 Radio Infrastructure Replacement Technology ‐$ (15,900)$ TE‐12001 Development Center Blueprint Technology Enhancements Technology ‐$ 39,800$ TE‐19000 Enterprise Resource Planning Upgrade Technology ‐$ (53,600)$ VR‐17000 Scheduled Vehicle and Equipment Replacement ‐ Fiscal Year 2017 Vehicle ‐$ (90,300)$ VR‐18000 Scheduled Vehicle and Equipment Replacement ‐ Fiscal Year 2018 Vehicle ‐$ (328,900)$ VR‐19000 Scheduled Vehicle and Equipment Replacement ‐ Fiscal Year 2019 Vehicle ‐$ 163,000$ Total All Funds 15,193,061$ 12,361,800$ Page 3 of 3 FY 2020 Technical Clean‐up Actions ATTACHMENT C Fund Name Department Title Description Expense Capital Improvement Fund Public Works Charleston/Arastradero Corridor Project (PE‐ 13011) This 2014 Infrastructure Plan (IP) project was over expended in FY 2019, and the budget was increased by $261,400 as part of the FY 2019 Year‐End process. In order to maintain the total project budget of $19.6 million over the life of the project, a corresponding decrease of $261,400 is recommended in FY 2020. ‐$261,400 Capital Improvement Fund Public Works Fire Station 3 Replacement (PE‐15003) This 2014 Infrastructure Plan (IP) project was over expended in FY 2019, and the budget was increased by $212,900 as part of the FY 2019 Year‐End process. In order to maintain the total project budget of $10.1 million over the life of the project, a corresponding decrease of $212,900 is recommended in FY 2020. ‐$212,900 Capital Improvement Fund Public Works New Public Safety Building (PE‐15001) This 2014 Infrastructure Plan (IP) project was over expended in FY 2019, and the budget was increased by $151,200 as part of the FY 2019 Year‐End process, and a corresponding decrease of $151,200 is recommended in FY 2020. In addition, as part of the Adopted FY 2020 Capital Budget, it was estimated that $3.0 million would be encumbered for this project in FY 2019. This encumbrance was never done so $3.0 million is recommended to be appropriated to this project in FY 2020 in order to maintain the total project budget of $115.5 million over the life of the project. $2,848,800 1 of 2 FY 2020 Technical Clean‐up Actions ATTACHMENT C Fund Name Department Title Description Expense Capital Improvement Fund Public Works Rinconada Park Improvements (PE‐08001) This project was over expended in FY 2019, and the budget was increased by $54,900 as part of the FY 2019 Year‐End process. In order to maintain the total project budget of $4.7 million over the life of the project, a corresponding decrease of $54,900 is recommended in FY 2020. ‐$54,900 All Funds $2,319,600 2 of 2 City of Palo Alto (ID # 10700) City Council Staff Report Report Type: Consent Calendar Meeting Date: 10/21/2019 City of Palo Alto Page 1 Summary Title: Resource Adequacy Transaction Process and Confirms Title: Adoption of a Resolution Approving the Process for Executing Resource Adequacy Capacity Purchases and Sales; Approving Standard Form Resource Adequacy Confirmation Letters; and Delegating Authority to the City Manager to Execute Resource Adequacy Purchases and Sales Under Established Guidelines From: City Manager Lead Department: Utilities Recommendation Staff recommends that the City Council adopt a resolution (Attachment A) to: a) Clarify the process the City will employ for purchases and sales of Resource Adequacy (RA) capacity, including eligibility requirements for counterparties wishing to transact with the City for RA capacity products; b) Approve an updated standard form RA Confirmation Letter (confirm) to the City’s Edison Electric Institute (EEI) Master Agreement (Exhibit A to Attachment A); c) Approve an updated standard form RA Confirmation Letter (confirm) to the City’s Western Systems Power Pool (WSPP) Master Agreement (Exhibit B to Attachment A); and d) Delegate authority to the City Manager, and/or his/her designee, to execute RA capacity purchases and sales under the EEI and/or WSPP Master Agreements using the standard form RA Confirmation Letters. Executive Summary The California Independent System Operator (CAISO) manages the state’s transmission grid and operates a Resource Adequacy (RA) program designed to ensure grid capacity and reliability. Since 2008, in order to meet RA compliance obligations imposed by the CAISO and the California Public Utilities Commission to procure generation capacity, and to do so at the lowest possible total cost, the City has acted as both a buyer and a seller of RA capacity products. The City’s Energy Risk Management (ERM) Guidelines authorize the purchase and sale of RA under Council-approved Master Agreements. While the Palo Alto Municipal Code provides clear guidelines on how the City can procure (buy) RA capacity, and the limitations on doing so, the Code is less clear on the authority and limits on RA capacity sales. This report provides City of Palo Alto Page 2 additional clarity around the process and requirements that staff must follow in selling RA capacity and is intended to supplement the direction already provided in the City’s municipal code and Energy Risk Management Policies and Guidelines. The City Council has previously delegated the authority to the City Manager to enter into RA transactions with other members of the Northern California Power Agency (NCPA), as well as a group of nine pre-qualified suppliers with whom the City has executed EEI or WSPP Master Agreements. In previous years, this limited pool of potential counterparties was enough to allow the City to meet its RA capacity obligations. But as the RA capacity markets have developed recently—and as Community Choice Aggregators (CCAs) have arrived as important players in this market—staff seeks to broaden the pool of potential counterparties for RA capacity transactions, to permit the City to transact with any creditworthy counterparty who is willing and able to transact via the City’s Council-approved standard form Master Agreements and RA Confirmation Letters. Background Since 2008 the California Independent System Operator (CAISO) has allocated responsibility to load-serving entities to maintain enough generation capacity to support transmission grid reliability. Like all load-serving entities, of Palo Alto Utilities (CPAU) is required on a monthly basis to demonstrate its ability to cover 115% of its monthly peak capacity with qualifying system capacity resources. Similarly, CPAU is required to own or contract for local capacity every year in an amount equivalent to about 50% of its summer peak load from generation resources located in one of the CAISO-designated local capacity areas in Northern California (such as the San Francisco Bay Area, Stockton, or the Greater Fresno area) or be subject to an allocation of CAISO’s backstop procurement costs to compensate for any shortfall in capacity. Finally, starting in CY 2015, load-serving entities in California began to incur flexible capacity obligations in order to help manage the increased ramping requirements (i.e., the “duck curve”) that are now occurring in the CAISO system as a result of the large volume of variable renewable energy resources coming online. Because the City now buys the output of five large- scale solar projects, the City began receiving a flexible capacity procurement obligation starting in CY 2017. To comply with its obligation to procure RA capacity, the City adopted an Electric Utility Resource Adequacy Program in 2008 (Resolution 8870). The City satisfies a portion of these obligations with its hydroelectric and renewable energy contract commitments, and contracts for RA capacity products for the rest. In general, the City currently has moderately large deficits of local and flexible capacity every year, and moderately large surpluses of system capacity1, as indicated in the summary table below for CY 2019. 1 “System capacity,” also known as “generic capacity,” is qualifying generating capacity that supports the reliability of the electric grid. It can be located anywhere in the CAISO balancing authority area. “Local capacity” is qualifying generating capacity located in certain generation-constrained areas within the CAISO balancing authority area. Local capacity can also be counted toward an entity’s system capacity requirements. City of Palo Alto Page 3 Table 1: Palo Alto's RA Capacity Balances for CY 2019 (in Megawatts) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Local RA Requirement 81 81 81 81 81 81 81 81 81 81 81 81 City-owned Local RA Resources 23 28 33 42 43 51 43 40 39 29 21 24 Deficit (-) or Surplus (+) Position (59) (54) (49) (40) (39) (30) (39) (41) (42) (52) (60) (57) Flexible RA Requirement 105 88 104 99 96 105 88 100 114 112 95 98 City-owned Flexible RA Resources 58 58 58 58 58 58 58 58 58 58 58 58 Deficit (-) or Surplus (+) Position (47) (30) (46) (41) (39) (47) (30) (42) (56) (54) (37) (40) System RA Requirement 145 142 149 158 169 182 182 181 177 162 150 146 City-owned System RA Resources 200 242 229 282 258 302 288 278 234 209 219 220 Local RA Requirement Purchases 59 54 49 40 39 30 39 41 42 52 60 57 Deficit (-) or Surplus (+) Position 114 153 128 164 127 149 144 138 100 99 130 130 System RA Available to Resell 64 64 64 64 64 64 64 64 64 64 64 64 Over the past ten years, the net cost of complying with these RA capacity procurement obligations has hovered around $1 to $2 million per year. However, the market for system RA capacity has recently tightened considerably, driving up the price of these resources. The City has received additional sales revenue from selling its excess system RA capacity using the Council-approved EEI and WSPP agreements. As a result, in FY 2018 the net cost of the City’s RA capacity purchases and sales was only about $0.3 million ($1.35 million in capacity purchases, versus $1.06 million in capacity sales). Discussion Current RA Transaction Authority In the early years of the CAISO RA procurement requirement, the City’s RA transactions primarily involved buying local RA capacity from already enabled counterparties under the City’s existing EEI master agreements. The authority for the City to transact for RA, a type of wholesale utility commodity, is provided in the City’s Municipal Code (PAMC) and Energy Risk Management Policy. PAMC Section 2.30.225 states that “The City Manager, the director of utilities and their designated employees, may enter into and execute transactions for wholesale utilities commodities and services in accordance with the authority, limits and procedures set forth in the Energy Risk Management Policies, Guidelines and Procedures Manual, as amended from time to time.” Section G of the City’s Energy Risk Management (ERM) Policy lists resource adequacy capacity as one of the “Authorized Products” that the City may purchase and sell City of Palo Alto Page 4 under the Council-approved Master Agreements, provided that such transactions are “consistent with the needs of CPAU and fall within the authority granted by the Council to the City Manager.” Further, in accordance with PAMC section 2.30.210(k), the City Manager has the authority to award contracts for wholesale utility commodities for terms of up to five years and for a price not to exceed $250,000 or more in any one year. PAMC section 2.30.270(b) governs the City Manager’s delegation of authority to contract for wholesale utility commodities to the Director of Utilities. However, the PAMC is primarily oriented around situations where the City is purchasing electricity products such as RA capacity, laying out the requirements for competitive solicitation of such products, contract terms, and the City Manager’s transaction authority. Neither the PAMC nor the Energy Risk Management Policy and Guidelines explicitly describe a process or requirements governing RA sales. While the overarching goals of the PAMC and the ERM Policy and Guidelines still apply—to ensure that transactions are commercially reasonable and protect City funds—some of the specific requirements and procedures are not precisely applicable to situations in which City is selling the RA. Updated RA Transaction Guidelines The objective of this report is to set forth a process under which the City Manager is delegated the authority to both purchase and sell the City’s RA under certain conditions, and to provide clarity around how counterparties become eligible to either purchase the City’s excess RA, or sell RA to the City for the City’s own compliance obligations. Since Section G of the ERM Policy states that the Council shall delegate to the City Manager the authority to transact under Council-approved Master Agreements, staff recommends that the Council delegate authority to the City Manager, or his designee, to execute RA purchase and/or sale transactions subject to the following guidelines: • Purpose – The principal purpose of RA capacity purchases is to meet the City’s RA compliance obligation, and the principal purpose of RA capacity sales is to reduce the City’s electric supply costs associated with its RA compliance obligation; • Eligible Counterparties – The City shall only execute RA transactions with counterparties who satisfy the eligibility criteria described in the section below, which include being deemed creditworthy by the City’s Energy Risk Manager (in accordance with Section 2.30.340(c)(3) of the PAMC); • Contract Form – RA capacity transactions shall be executed using a standard form RA confirm2 to either the EEI Master Agreement or the WSPP Master Agreement, in accordance with Section 2.30.340 of the PAMC. The RA confirms presented as Exhibits A and B to Attachment A are the City’s standard form RA confirms; these documents will 2 A confirmation letter (“confirm”) is a document that memorializes the terms of an individual transaction between two counterparties when that transaction is executed under the overall terms of an existing master agreement between those parties. The confirm, along with the governing terms of the master agreement, together constitute “the agreement.” City of Palo Alto Page 5 be modified to fit specific circumstances, in accordance with the purposes outlined above, and with approval by the City Attorney’s Office; • ERM Guidelines – All RA capacity transactions shall be conducted in accordance with the City’s applicable ERM Guidelines, which establish limits on counterparty credit exposure, transaction volume, contract term, and delegated approval authority; and also establish requirements related to reporting, risk analysis, competitive solicitations, and the trade capture process; • Periodic Reporting – Staff shall report on a quarterly basis to the Utilities Advisory Commission and City Council on the status of RA capacity purchase costs and sales revenue, as is currently the practice; and • Disposition of Funds – Sales revenue received through RA capacity sales shall be used to offset supply costs of the Electric Fund, as is currently the practice, and projections of RA capacity sales revenue shall continue to be considered in the annual budget process. The above RA transaction guidelines are consistent with the PAMC and the ERM Policy and Guidelines, and they further the objective of protecting City funds while maintaining a transparent and competitive procurement process. Eligible Counterparties At present, the City Manager is authorized to execute RA capacity transactions, subject to certain expenditure limits, with other members of the Northern California Power Agency (NCPA) (per Resolution 8763) and with a set of nine pre-qualified suppliers with whom the City has an executed EEI Master Agreement (per Resolution 9324). For many years, despite the absence of a centralized capacity market in California, this relatively small group of approved counterparties was sufficient to allow the City to meet its RA capacity procurement needs— which, as noted above, were primarily focused on purchases of local RA capacity. However, in recent years, the RA capacity market in California has grown in size and complexity (with the introduction of the flexible RA capacity product and obligation), and in dollar volume (with overall RA prices rising sharply in the past two years). These changes are partly due to the changing makeup of the generation mix in the state—as more solar capacity comes online it creates a need for more fast-ramping, flexible generation that can meet the system’s evening peak demand needs. And in part these changes are due to the surge of Community Choice Aggregators (CCAs) serving California customers, which has created a far larger pool of RA capacity market participants and increased market demand. In order to remain competitive in these market conditions and help keep electric supply costs down, staff recommends broadening the pool of eligible RA capacity counterparties to include all entities who are deemed creditworthy by the City’s Energy Risk Manager, and who are able and willing to transact via the City’s approved RA confirms (which are attached as exhibits to the City’s standard form Master Agreements). This will expand the number of eligible counterparties (since most market participants in California are WSPP members) while maintaining the City’s required contract terms and creditworthiness requirements, thus City of Palo Alto Page 6 protecting the City’s interests. This change is necessary because the City’s current pool of eligible counterparties is not always capable of providing enough flexible RA capacity to meet the City’s CAISO obligations, and they do not always have sufficient demand for the City’s excess system RA capacity. For example, in a recent competitive solicitation where the City sought to buy (local and flexible) and sell (system) RA capacity for CY 2020, the City received only a few proposals from currently-eligible suppliers, but it received several very attractive proposals from CCAs and other not-yet eligible suppliers. An expansion of the pool of eligible RA transaction counterparties is consistent with recent precedent. When the City was unable to meet its local RA capacity obligations for CY 2013 from its pool of eligible suppliers, the City Council passed Resolution 9276, which allowed the City Manager to purchase local RA capacity products from any supplier meeting the City’s creditworthiness requirements for wholesale utility commodity contracts, subject to a $2 million annual expenditure limit. However, this authority only applied to transactions needed to meet the City’s RA capacity obligations for CY 2013. Resource Impact Adoption of the attached resolution has no budgetary impact and will not commit the City to engaging in any transactions. However, adoption of the attached resolution will enable the City to proceed with individual transactions with any qualified counterparties. Potential budget impacts from RA transactions will continue to be analyzed as part of the annual budget process. Policy Implications Approval of the attached resolution is consistent with the Council-approved Electric Integrated Resource Plan and supports the Council-approved 2018 Utilities Strategic Plan’s strategy to achieve a sustainable and resilient energy supply. Environmental Review Adoption of the attached resolution is not subject to California Environmental Quality Act (CEQA) review, as it is an administrative governmental activity that will not result in any direct or indirect physical change to the environment (CEQA Guidelines section 15378(b)(5)). Attachments: • Attachment A: Resolution Approving an RA Transaction Process and Confirmation Letters Attachment A * NOT YET APPROVED * 6055278 Resolution No. _____ Resolution of the Council of the City of Palo Alto Approving a Process for Executing Resource Adequacy Capacity Purchases and Sales, Approving Standard Form Resource Adequacy Confirmation Letters, and Delegating Authority to the City Manager to Execute Resource Adequacy Purchases and Sales Under Established Guidelines R E C I T A L S A. The City of Palo Alto (the “City") is an electric load-serving entity operating within the California electric transmission grid operated by the California Independent System Operator (“CAISO”). B. The CAISO, in order to serve electric load in a reliable manner, coordinates the development of coherent Resource Adequacy (“RA”) capacity standards that conform to state law, and assigns pro rata shares of the overall RA capacity standards to all load-serving entities operating within the CAISO balancing authority area. C. To comply with its obligation to procure RA capacity, the City adopted an Electric Utility Resource Adequacy Program in 2008 (Resolution 8870). D. The City satisfies a portion of its CAISO RA capacity obligations through its long- term contracts for renewable and hydroelectric resources, but also regularly purchases local and flexible RA capacity products, and sells excess system RA capacity through bilateral transactions to reduce the City’s electric supply costs associated with its RA compliance obligation. E. Section 2.30.225 of the Palo Alto Municipal Code (“PAMC”) states that “The City Manager, the director of utilities and their designated employees may enter into and execute transactions for wholesale utilities commodities and services in accordance with the authority, limits and procedures set forth in the Energy Risk Management Policies, Guidelines and Procedures Manual, as amended from time to time.” F. Section G of the City’s Energy Risk Management (ERM) Policy lists capacity as one of the “Authorized Products” that the City may purchase and sell under the Council- approved Master Agreements, provided that such transactions are “consistent with the needs of CPAU and fall within the authority granted by the Council to the City Manager.” G. The PAMC and the ERM Policy and Guidelines documents are primarily oriented around situations where the City is purchasing electricity products, but these documents do not explicitly describe a process or requirements involved in sales of such products. H. In 2007, through Resolution 8763, the Council delegated authority to the City Manager, or his designee, to execute purchases and sales of RA capacity products with members of the Northern California Power Agency (“NCPA”), with a cost limitation of $4 million Attachment A * NOT YET APPROVED * 6055278 per year. I. In 2013, through Resolution 9324, the Council authorized the City Manager to execute Master Agreements with a group of nine pre-qualified suppliers, through which the City Manager or his designee, the Director of Utilities, could execute purchases and sales of electricity-related products and services, including RA capacity. J. Section 2.30.340(c) of the PAMC authorizes the City to execute wholesale utility commodity contracts via standard form contracts, including those published by the Edison Electric Institute (“EEI”) and the Western Systems Power Pool (“WSPP”). Both of these master agreements include RA capacity confirmation letters that can be used to execute RA capacity transactions. K. An active set of counterparties is essential to ensure that the City of Palo Alto meets its electric supply portfolio objectives and various program needs in a competitive and efficient manner. In recent years the City’s pool of eligible counterparties has at times been unable to satisfy the City’s demand for flexible RA capacity, and at times has been unable to absorb the City’s excess system RA capacity. L. To address a lack of counterparties able to provide the City with sufficient local RA capacity, in 2012, through Resolution 9276, the Council authorized the City Manager, or his designee, to execute local RA capacity transactions with any counterparty who met the City’s creditworthiness requirement. But this authorization extended only to purchases of local RA capacity for calendar year 2013, and was subject to a $2 million cost limitation. The Council of the City of Palo Alto does hereby RESOLVE, as follows: SECTION 1. The Council hereby approves updated standard form RA capacity confirmation letters to the EEI Master Agreement (Exhibit A) and to the WSPP Master Agreement (Exhibit B). SECTION 2. The Council hereby establishes a process for executing both purchases and sales of RA capacity products, intended to supplement the direction provided in the City’s municipal code and Energy Risk Management Policies and Guidelines, and authorizes the City Manager, and/or his/her designee, to execute RA purchase and/or sale transactions subject to the following guidelines: • Purpose – The principal purpose of all RA capacity purchases is to meet the City’s RA compliance obligation, and the principal purpose of RA capacity sales is to reduce the City’s electric supply costs associated with its RA compliance obligation; • Eligible Counterparties – The City shall only execute RA transactions with counterparties who are deemed creditworthy by the City’s Energy Risk Manager and who are able and willing to transact via one of the City’s standard form RA confirmation letters (Exhibits A and B); • Contract Form – RA capacity transactions shall be executed using one of the City’s standard form RA confirmation letters (Exhibits A and B). The RA confirms presented as Attachment A * NOT YET APPROVED * 6055278 Exhibits A and B to Attachment A are the City’s standard form RA confirms; these documents will be modified to fit specific circumstances, in accordance with the purposes outlined above, and with approval by the City Attorney’s Office; • ERM Guidelines – All RA capacity transactions shall be conducted in accordance with the City’s applicable ERM Guidelines; • Periodic Reporting – Staff shall report on a quarterly basis to the Council and Utilities Advisory Commission on the status of RA capacity purchase costs and sales revenue; and • Disposition of Funds – Sales revenue received through RA capacity sales shall be used to offset supply costs of the Electric Fund, and projections of RA capacity sales revenue shall continue to be considered as part of the annual budget process SECTION 3. The Council finds that the adoption of this resolution extending the City Manager’s authority to execute purchases (and incidental sales) of RA capacity is not a project subject to California Environmental Quality Act (CEQA) review because adoption of this resolution is an administrative government activity that will not result in any direct or indirect physical change to the environment as a result (CEQA Guidelines section 15378(b)(5)). INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ___________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ___________________________ Assistant City Attorney City Manager ___________________________ Director of Utilities ___________________________ Director of Administrative Services Exhibit A to Attachment A * NOT YET APPROVED * 4 California Resource Adequacy Product – Form Confirmation to the EEI Master Power Purchase & Sale Agreement Version 1.0 ©2018 by the Edison Electric Institute ALL RIGHTS RESERVED UNDER U.S. AND FOREIGN LAW, TREATIES AND CONVENTIONS. AUTOMATIC LICENSE – PERMISSION OF THE COPYRIGHT OWNERS IS GRANTED FOR REPRODUCTION BY DOWNLOADING FROM A COMPUTER AND PRINTING ELECTRONIC COPIES OF THE WORK. NO AUTHORIZED COPY MAY BE SOLD. WHEN USED AS A REFERENCE, ATTRIBUTION TO THE COPYRIGHT OWNERS IS REQUESTED. By making this available, the foregoing do not offer legal advice, and all users are urged to consult with their own legal counsel to ensure that their commercial objectives will be achieved and legal interests protected. This document may be periodically reviewed and revised after publication in response to market developments and comments received. The foregoing should not be construed as a warranty or assurance that further revisions will be forthcoming, or of the timeliness or comprehensiveness of such revisions. Exhibit A to Attachment A * NOT YET APPROVED * 5 RESOURCE ADEQUACY CONFIRMATION LETTER This confirmation letter (“Confirmation”) confirms the Transaction agreed to on _________, ____ (the “Confirmation Date”), between ________ and ________ , by which Seller agrees to sell and deliver, and Buyer agrees to purchase and receive, the Product, and is governed by the Master Power Purchase and Sale Agreement between the Parties, effective as of [Date of EEI Master between Parties], together with the Cover Sheet to the EEI Agreement, [the Collateral Annex and Paragraph 10 to the Collateral Annex,] and any other annexes thereto (collectively, as amended, restated, supplemented, or otherwise modified from time to time, the “Master Agreement”). Capitalized terms not otherwise defined in this Confirmation or the Master Agreement are defined in the Tariff. References to Sections are references to Sections of this Confirmation unless stated to be references to Sections of the Master Agreement or a statute. ARTICLE 1 TRANSACTION TERMS Buyer: _________ Seller: _________ Product, Delivery Period, Quantity, Contract Price and other specifics of the Product are in Appendix B. Appendices A B and C are incorporated into this Confirmation. ARTICLE 2 DELIVERY OBLIGATIONS AND ADJUSTMENTS 2.1 Sale and Delivery of Product (a) For each Showing Month of the Delivery Period, Seller will sell and deliver to Buyer, and Buyer will purchase and receive from Seller, the Quantity of the Product from the Shown Unit(s). (b) Seller will deliver the Quantity by submitting to CAISO in its Supply Plan the Shown Unit and the characteristics of the Shown Unit and Product for Buyer, as further specified in Appendix B, all in compliance with this Confirmation. (c) Seller will cause all Supply Plans to meet and be filed in conformance with the requirements of the CPUC and the Tariff. Seller will submit, or cause the Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Buyer for each Showing Month of the Delivery Period. The total amount of Product identified and confirmed for each day of such Showing Month will equal the Quantity, less any excused deductions to the Quantity in the case of Flexible RA Capacity for excused reductions in Unit EFC. Exhibit A to Attachment A * NOT YET APPROVED * 6 (d) Seller may sell and deliver from a Shown Unit that meets requirements set forth in Appendix B. Seller will identify the Shown Unit(s) and Quantity by providing Buyer with the specific Unit information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month. (e) If CAISO rejects either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Quantity for the Shown Unit in any Showing Month, the Parties will confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month. (f) The Product is delivered and received when the CIRA Tool shows the Supply Plan accepted for the Product from the Shown Unit by CAISO or Seller complies with Buyer’s instruction to withhold all or part of the Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period. Seller has failed to deliver the Product if (i) Buyer has elected to submit the Product from the Shown Unit in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section 2.1(e) or (ii) Seller fails to submit the volume of Quantity for any Showing Month in such amount as instructed by Buyer for the applicable Showing Month. Buyer will have received the Quantity if (i) Seller’s Supply Plan is accepted by the CAISO for the applicable Showing Month or (ii) Seller complies with Buyer’s instruction to withhold all or part of the Quantity from Seller’s Supply Plan for the applicable Showing Month. Seller will not have failed to deliver the Quantity if Buyer fails or chooses not to submit the Shown Unit and the Product in its Resource Adequacy Plan with the CPUC or CAISO. (g) The Shown Unit must not have characteristics that would trigger the need for Buyer or Seller to file an advice letter or other request for authorization with the CPUC or for Buyer to make a compliance filing pursuant to California Public Utilities Code Section 380.1 (h) Excused Reductions in Unit EFC: If the Product includes FCR Attributes, then Seller’s failure to deliver any of the Quantity of FCR Attributes during the Delivery Period will be excused if the Unit experiences a reduction in Unit EFC after the Confirmation Date as determined by CAISO and Seller has provided notice of such reduction to Buyer by the Notification Deadline for the applicable Showing Month. The extent to which Seller’s failure is excused will equal (i) the Quantity of FCR Attributes for such day multiplied by (ii) the total amount (in MW) by which the Unit EFC was reduced since the Confirmation Date, divided by (iii) the Unit EFC as of the Confirmation Date. If the Unit experiences such a reduction in Unit EFC, then Seller 1 For example, contracts with Once-Through Cooling resources that terminate one year or less before the State Water Resources Control Board compliance deadline require an advice letter filing under CPUC Decision 12-04- 046. Exhibit A to Attachment A * NOT YET APPROVED * 7 may, but is not obligated to, provide the applicable part of the Quantity of FCR Attributes for such day from the Shown Unit. 2.2 Buyer’s Remedies for Seller’s Failure to Deliver Quantity (a) If Seller fails to deliver any part of the Quantity as required herein for any Showing Month, Seller is liable for damages pursuant to Section 4.1 of the Master Agreement. (b) Seller agrees to indemnify, defend and hold harmless Buyer from any penalties, fines or costs, including Environmental Costs, assessed against Buyer by the CPUC, CAISO or other Governmental Body resulting from Seller’s failure to deliver the Product. The Parties will use commercially reasonable efforts to minimize such penalties, fines or costs; provided, that in no event will Buyer be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties, fines or costs. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Buyer for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Buyer may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the Master Agreement. 2.3 Buyer’s Re-Sale of Product (a) Buyer may re-sell all or part of the Product; provided that any such re-sale must not increase Seller’s obligations hereunder other than as set forth in this Section 2.3(a). For any such a resale, Resource Adequacy Plan of Buyer as used herein will refer to the Resource Adequacy Plan of Subsequent Buyer. Seller will, or will cause the Unit’s SC, to follow Buyer’s instructions with respect to providing such resold Product to Subsequent Buyers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation. Seller will, and will cause the Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Buyers to use such resold Product in a manner consistent with Buyer’s rights under this Confirmation. If Buyer incurs any liability to a Subsequent Buyer due to the failure of Seller or the Unit’s SC to comply with this Confirmation, Seller will be liable to Buyer for the same amounts Seller would have owed Buyer under this Confirmation if Buyer had not resold the Product. (b) Buyer will notify Seller in writing of any resale of Product and the Subsequent Buyer no later than two Business Days before the Notification Deadline for the Showing Month. Buyer will notify Seller of any subsequent changes or further resales no later than two Business Days before the Notification Deadline for the Showing Month. Exhibit A to Attachment A * NOT YET APPROVED * 8 ARTICLE 3 PAYMENTS 3.1 Payment After Seller has delivered the Quantity in accordance with Section 2.1 and issued its invoice, Buyer must pay for the Product as provided in Article Six of the Master Agreement. The Monthly RA Capacity Payment shall equal the product of (a) the applicable Contract Price for that Showing Month, (b) the Quantity for the Showing Month, and (c) 1,000, rounded to the nearest penny (i.e., two decimal places). 3.2 Allocation of Other Payments and Costs (a) Seller will receive any revenues from, and must pay all costs charged by, CAISO or any other third party with respect to the Unit for (i) start-up, shutdown, and minimum load costs, (ii) capacity for ancillary services, (iii) energy sales, (iv) flexible ramping product, or (v) black start or reactive power services. Buyer must promptly report receipt of any such revenues to Seller. Buyer must pay to Seller any such amounts described in this Section 3.2(a) received by Buyer or a Subsequent Buyer. Without prejudice to its other rights and remedies, Seller may setoff and recoup any such amounts that are not paid to it against any amounts owed to Buyer under the Master Agreement. (b) Buyer is to receive and retain all revenues associated with the Quantity of Product during the Delivery Period, including any capacity and availability revenues from the Capacity Procurement Mechanism, or its successor, RUC Availability Payments, or its successor, but excluding payments described in Section 3.2(a)(i)-(v) or 3.2(d). Seller must promptly report receipt of any such revenues to Buyer. Seller must pay to Buyer any such amounts received by Seller, or a Unit’s SC, owner, or operator. Without prejudice to its other rights, Buyer may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the Master Agreement. (c) If CAISO designates any part of the Quantity as Capacity Procurement Mechanism Capacity, then Seller will, or will cause the Unit’s SC to, within one Business Day of the time Seller receives notification from CAISO, notify Buyer and not accept any such designation by CAISO unless and until Buyer has agreed to accept such designation. (d) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay. ARTICLE 4 OTHER BUYER AND SELLER COVENANTS 4.1 CAISO Requirements Exhibit A to Attachment A * NOT YET APPROVED * 9 Seller must schedule or cause the Unit’s SC to schedule or make available to CAISO the Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or cause the Unit’s SC, owner, or operator to perform all, obligations under applicable law and the Tariff relating to the Product. Buyer is not liable for, and Seller will indemnify and hold Buyer harmless from, the failure of Seller or the Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties, fines or costs imposed on Seller or the Unit’s SC, owner, or operator for noncompliance. 4.2 Seller’s and Buyer’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Buyer and Seller will take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure Buyer’s rights to the Quantity for the sole benefit of Buyer or any Subsequent Buyer. If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction. 4.3 Seller’s Representations and Warranties Seller represents and warrants to Buyer throughout the Delivery Period that: (a) no part of the Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets; (b) the Unit qualifies under the Tariff for the Product, and the Unit and Seller are capable of delivering the Product; (c) the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Unit during the Delivery Period does not exceed the Unit NQC and, if applicable, the Unit EFC, for that Unit; (d) if applicable, Seller has notified either the Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Quantity of Product for the Delivery Period to Buyer; and (e) Seller has notified or will notify the Unit’s SC that Buyer is entitled to the revenues set forth in Section 3.2(b), and such SC is obligated to promptly deliver those revenues to Buyer, along with appropriate documentation supporting the amount of those revenues. ARTICLE 5 ADDITIONAL MASTER AGREEMENT AMENDMENTS; GENERAL PROVISIONS 5.1 Termination Payment Exhibit A to Attachment A * NOT YET APPROVED * 10 For this Transaction, the following is added to the end of Section 5.3 of the Master Agreement: “If Buyer is the Non-Defaulting Party and Buyer reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Buyer or a Subsequent Buyer is not able to include the applicable Quantity in a Compliance Showing due to Seller’s Event of Default, then Buyer may, in good faith, estimate the amount of those penalties, fines or costs and include the estimate in its determination of the Termination Payment, subject to accounting to Seller when those penalties, fines or costs are finally ascertained. If this accounting establishes that Buyer’s estimate exceeds the actual amount of penalties, fines or costs, Buyer must promptly remit to Seller the excess amount with interest in accordance with Section 6.2 of the Master Agreement. The rights and obligations with respect to determining and paying any Termination Payment, and any dispute resolution provisions with respect thereto, survive the termination of this Transaction and continue until after those penalties, fines or costs are finally ascertained.” 5.2 Confidentiality Notwithstanding Section 10.11 of the Master Agreement, (i) Buyer may disclose information in order to support its Compliance Showings or otherwise show it has met its Compliance Obligations; (ii) Seller may disclose to a Unit’s SC or as necessary for Supply Plans; (iii) each Party may disclose information to the independent evaluator or other administrator of any competitive solicitation process of Buyer, which in turn may disclose such information to CAISO or any Governmental Body; and (iv) Buyer may disclose information to any Subsequent Buyer. 5.3 Dodd-Frank Act Each Party represents and warrants to the other that it is an “eligible commercial entity” and an “eligible contract participant” within the meaning of United States Commodity Exchange Act §§1a(17) and 1a(18), respectively. Without limiting Section 10.10 of the Master Agreement, the Parties intend this Transaction to be a “customary commercial arrangement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts, 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013). 5.4 Governing Law Nothing contained in this Confirmation shall be construed as a grant of CPUC jurisdiction over a Party not otherwise subject to such jurisdiction by law. For this Transaction, Section 10.6 of the Master Agreement is amended to replace “NEW YORK” with “CALIFORNIA”. Exhibit A to Attachment A * NOT YET APPROVED * 11 AGREED AS OF THE CONFIRMATION DATE: [SELLER] [BUYER] By: Name: Title: By: Name: Title: Exhibit A to Attachment A * NOT YET APPROVED * 12 APPENDIX A DEFINED TERMS “CAISO” means the California ISO. “Capacity Attributes” means attributes of the Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Unit; Unit ability to generate at a given capacity level, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations. “CIRA Tool” means the CAISO Customer Interface for Resource Adequacy. “Compliance Obligations” means, as applicable, RAR, Local RAR and FCR. “Compliance Showings” means the applicable LSE’s compliance with the resource adequacy requirements of the CPUC for an applicable Showing Month. “CPUC Decisions” means any currently effective or future decisions, resolutions, or rulings related to resource adequacy. “Environmental Costs” means (i) costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, (ii) the Product’s compliance with all applicable environmental laws, rules, and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product, (iii) all operating and maintenance costs for operation of pollution mitigation or control equipment, (iv) costs of permit maintenance fees and emission fees as applicable, (v) the costs of all emission reductions that have been authorized by a local air pollution control district or emissions trading credits or units pursuant to the California Health & Safety Code, market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, authorizations to emit sulfur dioxide and oxides of nitrogen by the Environmental Protection Agency, and any costs related to greenhouse gas emissions required by any applicable environmental laws, rules, regulations, or permits to operate, and (vi) costs associated with the disposal, clean-up, decontamination or remediation, on or off site, of hazardous substances. “FCR” means the Flexible Capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non-binding advisory showing which an LSE is required to make with respect to flexible capacity. “FCR Attributes” means, with respect to a Unit, any and all resource adequacy attributes of the Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s FCR. Exhibit A to Attachment A * NOT YET APPROVED * 13 “Governmental Body” means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal. “Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations. “LSE” means “Load Serving Entity” as such term is used in Section 40.9 of the Tariff. “MW” means megawatt. “Notification Deadline” is twenty (20) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month. “Product” means RAR, Local RAR and FCR, for the Delivery Period, Unit, Quantity, Contract Price and other specifications contained in Appendix B. “Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B, of the Unit NQC as of the Confirmation Date that is dedicated to Buyer under this Transaction. “Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Confirmation Date that is dedicated to Buyer under this Transaction. “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations. “SC” means Scheduling Coordinator as defined in the Tariff. “Showing Month” means the calendar month of the Delivery Period that is the subject of the related Compliance Showing. “Shown Unit” means a Unit specified by Seller in a Supply Plan, but not necessarily identified by Seller to Buyer on the Confirmation Date. “Subsequent Buyer” means the buyer of Product from Buyer in a re-sale of Product by Buyer. “Tariff” means the CAISO Tariff, including any current CAISO-published “Operating Procedures” and “Business Practice Manuals,” in each case as amended or supplemented from time to time. “Unit” means the generation unit described in Appendix B and any Shown Unit. Exhibit A to Attachment A * NOT YET APPROVED * 14 “Unit EFC” means Unit Effective Capacity and is the lesser of that of the Unit as set by CAISO as of the Confirmation Date and that of the Unit on a subsequent date of determination. “Unit NQC” means Unit Net Qualifying Capacity and is the lesser of that of the Unit as set by CAISO as of the Confirmation Date and that of the Unit on a subsequent date of determination. Exhibit A to Attachment A * NOT YET APPROVED * 15 APPENDIX B PRODUCT AND UNIT INFORMATION Product: RAR Local RAR Flexible Capacity and all Capacity Attributes related to such Product. Additional Product Information (fill in all that apply): CAISO Zone: ________________________________________________________ MCC Bucket: ________________________________________________________ CPUC Local Area (if applicable): _________________ Flexible Capacity Category (if applicable):______________ Delivery period: [Begin Date] through [End Date] [Showing Months of xxxx, xxxx, xxxxx]. Quantity and Contract Price: RAR and Local RAR, as applicable Showing Month and Year Quantity (MW) Contract Price ($/kW-mo) [MM] [YY] [XX] Flexible Capacity, if applicable Showing Month and Year Quantity (MW) Contract Price ($/kW-mo) [MM] [YY] [XX] Exhibit A to Attachment A * NOT YET APPROVED * 16 Unit 1 Unit Specific Information Resource Name ________ Physical Location ________ CAISO Resource ID ________ SCID of Resource ________ Unit NQC by month (e.g., Jan=50,Feb=65): ________ Unit EFC by month (e.g., Jan=30, Feb=50) ________ Resource Type (e.g., gas, hydro, solar, etc.) ________ Minimum Qualified Flexible Capacity Category (Flex 1, 2 or 3) ________ TAC Area (e.g., PG&E, SCE) ________ Prorated Percentage of Unit Factor ________ Prorated Percentage of Unit Flexible Factor ________ Capacity Area (CAISO System, Fresno, Sierra, , Kern, LA Basin, Bay Area, Stockton, Big Creek-Ventura, NCNB, San Diego-IV or Humboldt ) ________ Resource Category as defined by the CPUC (DR, 1, 2, 3, 4) ________ (Repeat for additional Units) [Information for specific Shown Units may be provided after the Confirmation Date pursuant to the Confirmation.] Exhibit A to Attachment A * NOT YET APPROVED * 17 APPENDIX C NOTICE INFORMATION Seller: ________ Buyer: ________ All notice information for Seller will be as set forth on the Cover Sheet to the Master Agreement unless otherwise set forth below. All notice information for Buyer will be as set forth on the Cover Sheet to the Master Agreement unless otherwise set forth below. All Notices: Attn: Phone: Facsimile: Duns: Federal Tax ID Number: All Notices: Attn: Phone: Facsimile: Duns: Federal Tax ID Number: Invoices: Invoices: Scheduling: Scheduling: Wire Transfer: Wire Transfer: Credit and Collections: Credit and Collections: Defaults: Additional notices of an Event of Default to: Defaults: Additional notices of an Event of Default to: Exhibit B to Attachment A * NOT YET APPROVED * 18 WSPP California Resource Adequacy Product Form Confirmation Version 1.0 10/2/2018 This document was developed by the WSPP Contract Subcommittee for use with the WSPP Agreement (see § 32.8). This document is not filed with the Federal Energy Regulatory Commission and is not part of the WSPP Agreement. Exhibit B to Attachment A * NOT YET APPROVED * 19 WSPP RESOURCE ADEQUACY CONFIRMATION This Confirmation under the WSPP Agreement confirms the transaction between ________ and ________ dated as of [date] (the “Effective Date”), by which Seller agrees to sell and deliver, and Purchaser agrees to purchase and receive, the Product (the “Transaction”). Capitalized terms not otherwise defined in this Confirmation or the WSPP Agreement are defined in the Tariff. ARTICLE 1 TRANSACTION TERMS Purchaser: _________ Seller: _________ Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are in Appendix B. Appendices A, B and C are incorporated into this Confirmation ARTICLE 2 DELIVERY OBLIGATIONS AND ADJUSTMENTS 2.01 Sale and Delivery of Product (a) For each Showing Month of the Delivery Period, Seller will sell and deliver to Purchaser, and Purchaser will purchase and receive from Seller, the Contract Quantity of the Product from the Shown Unit(s). (b) Seller will deliver the Contract Quantity by submitting to CAISO in its Supply Plan the Shown Unit and the characteristics of the Shown Unit and Product for Purchaser, as further specified in Appendix B, all in compliance with this Confirmation. (c) Seller will cause all Supply Plans to meet and be filed in conformance with the requirements of the CPUC and the Tariff. Seller will submit, or cause the Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Purchaser for each Showing Month of the Delivery Period. The total amount of Product identified and confirmed for each day of such Showing Month will equal the Contract Quantity, less any excused deductions to the Contract Quantity in the case of Flexible RA Capacity for excused reductions in Unit EFC. (d) Seller may sell and deliver from a Shown Unit that meets requirements set forth in Appendix B. Seller will identify the Shown Unit(s) and Contract Quantity by providing Purchaser with the specific Unit information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month. Exhibit B to Attachment A * NOT YET APPROVED * 20 (e) If CAISO rejects either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Contract Quantity for the Shown Unit in any Showing Month, the Parties will confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month. (f) The Product is delivered and received when the CIRA Tool shows the Supply Plan accepted for the Product from the Shown Unit by CAISO or Seller complies with Purchaser’s instruction to withhold all or part of the Contract Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period. Seller has failed to deliver the Product if (i) Purchaser has elected to submit the Product from the Shown Unit in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section 2.1(e) or (ii) Seller fails to submit the volume of Contract Quantity for any Showing Month in such amount as instructed by Purchaser for the applicable Showing Month. Purchaser will have received the Contract Quantity if (i) Seller’s Supply Plan is accepted by the CAISO for the applicable Showing Month or (ii) Seller complies with Purchaser’s instruction to withhold all or part of the Contract Quantity from Seller’s Supply Plan for the applicable Showing Month. Seller will not have failed to deliver the Contract Quantity if Purchaser fails or chooses not to submit the Shown Unit and the Product in its Resource Adequacy Plan with the CPUC or CAISO. (g) The Shown Unit must not have characteristics that would trigger the need for Purchaser or Seller to file an advice letter or other request for authorization with the CPUC or for Purchaser to make a compliance filing pursuant to California Public Utilities Code Section 380.2 (h) Excused Reductions in Unit EFC: Unless the Parties have designated this Section 2.1(h) as “Not applicable”, if the Product includes FCR Attributes, then Seller’s failure to deliver any of the Contract Quantity of FCR Attributes during the Delivery Period will be excused if the Unit experiences a reduction in Unit EFC after the Effective Date as determined by CAISO and Seller has provided notice of such reduction to Purchaser by the Notification Deadline for the applicable Showing Month. The extent to which Seller’s failure is excused will equal (i) the Contract Quantity of FCR Attributes for such day multiplied by (ii) the total amount (in MW) by which the Unit EFC was reduced since the Effective Date, divided by (iii) the Unit EFC as of the Effective Date. If the Unit experiences such a reduction in Unit EFC, then Seller may, but is not 2 For example, contracts with Once-Through Cooling resources that terminate one year or less before the State Water Resources Control Board compliance deadline require an advice letter filing under CPUC Decision 12-04-046 Exhibit B to Attachment A * NOT YET APPROVED * 21 obligated to, provide the applicable part of the Contract Quantity of FCR Attributes for such day from the Shown Unit. 2.02 Purchaser’s Remedies for Seller’s Failure to Deliver Contract Quantity (a) If Seller fails to deliver any part of the Contract Quantity as required herein for any Showing Month, Seller is liable for damages pursuant to Section 21.3 of the WSPP Agreement, without reference to the word “hourly” therein. (b) Seller agrees to indemnify, defend and hold harmless Purchaser from any penalties, fines or costs, including Environmental Costs, assessed against Purchaser by the CPUC, CAISO or other Governmental Body resulting from Seller’s failure to deliver the Product. The Parties will use commercially reasonable efforts to minimize such penalties, fines or costs; provided, that in no event will Purchaser be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties, fines or costs. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Purchaser for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the WSPP Agreement. 2.03 Purchaser’s Re-Sale of Product (a) Purchaser may re-sell all or part of the Product; provided that any such re-sale must not increase Seller’s obligations hereunder other than as set forth in this Section 2.3(a). For any such a resale, Resource Adequacy Plan of Purchaser as used herein will refer to the Resource Adequacy Plan of Subsequent Purchaser. Seller will, or will cause the Unit’s SC, to follow Purchaser’s instructions with respect to providing such resold Product to Subsequent Purchasers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation. Seller will, and will cause the Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Purchasers to use such resold Product in a manner consistent with Purchaser’s rights under this Confirmation. If Purchaser incurs any liability to a Subsequent Purchaser due to the failure of Seller or the Unit’s SC to comply with this Confirmation, Seller will be liable to Purchaser for the same amounts Seller would have owed Purchaser under this Confirmation if Purchaser had not resold the Product. (b) Purchaser will notify Seller in writing of any resale of Product and the Subsequent Purchaser no later than two Business Days before the Notification Deadline for the Showing Month. Purchaser will notify Seller of any subsequent changes or further resales no later than two Business Days before the Notification Deadline for the Showing Month. Exhibit B to Attachment A * NOT YET APPROVED * 22 ARTICLE 3 PAYMENTS 3.01 Payment After Seller has delivered the Contract Quantity in accordance with Section 2.1 and issued its invoice, Purchaser must pay for the Product as provided in Article 9 of the WSPP Agreement. The Monthly RA Capacity Payment shall equal the product of (a) the applicable Contract Price for that Showing Month, (b) the Contract Quantity for the Showing Month and (c) 1,000, rounded to the nearest penny (i.e., two decimal places). 3.02 Allocation of Other Payments and Costs (a) Seller will receive any revenues from, and must pay all costs charged by, CAISO or any other third party with respect to the Unit for (i) start-up, shutdown, and minimum load costs, (ii) capacity for ancillary services, (iii) energy sales, (iv) flexible ramping product, or (v) black start or reactive power services. Purchaser must promptly report receipt of any such revenues to Seller. Purchaser must pay to Seller any such amounts described in this Section 3.2(a) received by Purchaser or a Subsequent Purchaser. Without prejudice to its other rights and remedies, Seller may setoff and recoup any such amounts that are not paid to it against any amounts owed to Purchaser under the WSPP Agreement. (b) Purchaser is to receive and retain all revenues associated with the Contract Quantity of Product during the Delivery Period, including any capacity and availability revenues from the Capacity Procurement Mechanism, or its successor, RUC Availability Payments, or its successor, but excluding payments described in Section 3.2(a)(i)-(v) or 3.2(d). Seller must promptly report receipt of any such revenues to Purchaser. Seller must pay to Purchaser any such amounts received by Seller, or a Unit’s SC, owner, or operator. Without prejudice to its other rights, Purchaser may set off and recoup any such amounts that are not paid to it against amounts owed to Seller under the WSPP Agreement. (c) If CAISO designates any part of the Contract Quantity as Capacity Procurement Mechanism Capacity, then Seller will, or will cause the Unit’s SC to, within one Business Day of the time Seller receives notification from CAISO, notify Purchaser and not accept any such designation by CAISO unless and until Purchaser has agreed to accept such designation. (d) Any Availability Incentive Payments or Non-Availability Charges are for Seller to receive and pay. Exhibit B to Attachment A * NOT YET APPROVED * 23 ARTICLE 4 OTHER PURCHASER AND SELLER COVENANTS 4.01 CAISO Requirements Seller must schedule or cause the Unit’s SC to schedule or make available to CAISO the Contract Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or cause the Unit’s SC, owner, or operator to perform all, obligations under applicable law and the Tariff relating to the Product. Purchaser is not liable for, and Seller will indemnify and hold Purchaser harmless from, the failure of Seller or the Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties, fines or costs imposed on Seller or the Unit’s SC, owner, or operator for noncompliance. 4.02 Seller’s and Purchaser’s Duties to Take Actions to Allow Product Utilization Throughout the Delivery Period, Purchaser and Seller will take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure Purchaser’s rights to the Contract Quantity for the sole benefit of Purchaser or any Subsequent Purchaser. If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction. 4.03 Seller’s Representations and Warranties Seller represents and warrants to Purchaser throughout the Delivery Period that: (a) no part of the Contract Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets; (b) the Unit qualifies under the Tariff for the Product, and the Unit and Seller are capable of delivering the Product; (c) the aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Unit during the Delivery Period does not exceed the Unit NQC and, if applicable, the Unit EFC, for that Unit; (d) if applicable, Seller has notified either the Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Contract Quantity of Product for the Delivery Period to Purchaser; and (e) Seller has notified or will notify the Unit’s SC that Purchaser is entitled to the revenues set forth in Section 3.2(b), and such SC is obligated to promptly deliver those revenues to Purchaser, along with appropriate documentation supporting the amount of those revenues. Exhibit B to Attachment A * NOT YET APPROVED * 24 ARTICLE 5 ADDITIONAL WSPP AGREEMENT AMENDMENTS; GENERAL PROVISIONS 5.01 Termination Payment For this Transaction, the following is inserted as a penultimate paragraph in Section 22.2(b) of the WSPP Agreement: “If Purchaser is the Non-Defaulting Party and Purchaser reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Purchaser or a Subsequent Purchaser is not able to include the applicable Contract Quantity in a Compliance Showing due to Seller’s Event of Default, then Purchaser may, in good faith, estimate the amount of those penalties, fines or costs and include the estimate in its determination of the Termination Payment, subject to accounting to Seller when those penalties, fines or costs are finally ascertained. If this accounting establishes that Purchaser’s estimate exceeds the actual amount of penalties, fines or costs, Purchaser must promptly remit to Seller the excess amount with interest in accordance with Section 9.3 of the WSPP Agreement. The rights and obligations with respect to determining and paying any Termination Payment, and any dispute resolution provisions with respect thereto, survive the termination of this Transaction and continue until after those penalties, fines or costs are finally ascertained.” 5.02 Confidentiality Notwithstanding Section 30.1 of the WSPP Agreement, (i) Purchaser may disclose information in order to support its Compliance Showings or otherwise show it has met its Compliance Obligations; (ii) Seller may disclose to a Unit’s SC or as necessary for Supply Plans; (iii) each Party may disclose information to the independent evaluator or other administrator of any competitive solicitation process of Purchaser, which in turn may disclose such information to CAISO or any Governmental Body; and (iv) Purchaser may disclose information to any Subsequent Purchaser. 5.03 Dodd-Frank Act The Parties intend this Transaction to be a “customary commercial arrangement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts, 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013). 5.04 Governing Law Exhibit B to Attachment A * NOT YET APPROVED * 25 For this Transaction, Section 13.1 of the WSPP Agreement is amended to change “FERC” to “FERC or the CPUC”, and Section 24 of the WSPP Agreement is amended to replace “Utah” with “California”. AGREED AS OF THE EFFECTIVE DATE: [SELLER] [PURCHASER] By: Name: Title: By: Name: Title: Exhibit B to Attachment A * NOT YET APPROVED * 26 APPENDIX A DEFINED TERMS “CAISO” means the California ISO. “Capacity Attributes” means attributes of the Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Unit; Unit ability to generate at a given capacity level, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations. “CIRA Tool” means the CAISO Customer Interface for Resource Adequacy. “Compliance Obligations” means, as applicable, RAR, Local RAR and FCR. “Compliance Showings” means the applicable LSE’s compliance with the resource adequacy requirements of the CPUC for an applicable Showing Month. “CPUC Decisions” means any currently effective or future decisions, resolutions, or rulings related to resource adequacy. “Environmental Costs” means (i) costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, (ii) the Product’s compliance with all applicable environmental laws, rules, and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product, (iii) all operating and maintenance costs for operation of pollution mitigation or control equipment, (iv) costs of permit maintenance fees and emission fees as applicable, (v) the costs of all emission reductions that have been authorized by a local air pollution control district or emissions trading credits or units pursuant to the California Health & Safety Code, market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, authorizations to emit sulfur dioxide and oxides of nitrogen by the Environmental Protection Agency, and any costs related to greenhouse gas emissions required by any applicable environmental laws, rules, regulations, or permits to operate, and (vi) costs associated with the disposal, clean-up, decontamination or remediation, on or off site, of hazardous substances. “FCR” means the Flexible Capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non-binding advisory showing which an LSE is required to make with respect to flexible capacity. “FCR Attributes” means, with respect to a Unit, any and all resource adequacy attributes of the Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s FCR. Exhibit B to Attachment A * NOT YET APPROVED * 27 “Governmental Body” means any federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal. “Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations. “LSE” means “Load Serving Entity” as such term is used in Section 40.9 of the Tariff. “MW” means megawatt. “Notification Deadline” is twenty (20) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month. “Product” means RAR, Local RAR and FCR, for the Delivery Period, Unit, Contract Quantity, Contract Price and other specifications contained in Appendix B. “Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B, of the Unit NQC as of the Effective Date that is dedicated to Purchaser under this Transaction. “Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Effective Date that is dedicated to Purchaser under this Transaction. “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations. “SC” means Scheduling Coordinator as defined in the Tariff. “Showing Month” means the calendar month of the Delivery Period that is the subject of the related Compliance Showing. “Shown Unit” means a Unit specified by Seller in a Supply Plan, but not necessarily identified by Seller to Purchaser on the Effective Date. “Subsequent Purchaser” means the purchaser of Product from Purchaser in a re-sale of Product by Purchaser. “Tariff” means the CAISO Tariff, including any current CAISO-published “Operating Procedures” and “Business Practice Manuals,” in each case as amended or supplemented from time to time. “Unit” means the generation unit described in Appendix B and any Shown Unit. Exhibit B to Attachment A * NOT YET APPROVED * 28 “Unit EFC” means Unit Effective Capacity and is the lesser of that of the Unit as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination. “Unit NQC” means Unit Net Qualifying Capacity and is the lesser of that of the Unit as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination. 29 APPENDIX B PRODUCT AND UNIT INFORMATION Product: RAR Local RAR Flexible Capacity and all Capacity Attributes related to such Product. Additional Product Information (fill in all that apply): CAISO Zone: ________________________________________________________ MCC Bucket: ________________________________________________________ CPUC Local Area (if applicable): _________________ Flexible Capacity Category (if applicable):______________ Delivery period: [Begin Date] through [End Date] [Showing Months of xxxx, xxxx, xxxxx]. Contract Quantity and Contract Price: RAR and Local RAR, as applicable Showing Month and Year Contract Quantity (MW) Contract Price ($/kW-mo) [MM] [YY] [XX] Flexible Capacity, if applicable Showing Month and Year Contract Quantity (MW) Contract Price ($/kW-mo) [MM] [YY] [XX] 30 Unit 1 Unit Specific Information Resource Name ________ Physical Location ________ CAISO Resource ID ________ SCID of Resource ________ Unit NQC by month (e.g., Jan=50,Feb=65): ________ Unit EFC by month (e.g., Jan=30, Feb=50) ________ Resource Type (e.g., gas, hydro, solar, etc.) ________ Minimum Qualified Flexible Capacity Category (Flex 1, 2 or 3) ________ TAC Area (e.g., PG&E, SCE) ________ Prorated Percentage of Unit Factor ________ Prorated Percentage of Unit Flexible Factor ________ Capacity Area (CAISO System, Fresno, Sierra, , Kern, LA Basin, Bay Area, Stockton, Big Creek-Ventura, NCNB, San Diego-IV or Humboldt ) ________ Resource Category as defined by the CPUC (DR, 1, 2, 3, 4) ________ (Repeat for additional Units) [Information for specific Shown Units may be provided after the Effective Date pursuant to the Confirmation.] 31 APPENDIX C NOTICE INFORMATION Seller: ________ Purchaser: ________ All Notices: Attn: Phone: Facsimile: Duns: Federal Tax ID Number: All Notices: Attn: Phone: Facsimile: Duns: Federal Tax ID Number: Invoices: Invoices: Scheduling: Scheduling: Wire Transfer: Wire Transfer: Credit and Collections: Credit and Collections: Defaults: Additional notices of an Event of Default to: Defaults: Additional notices of an Event of Default to: City of Palo Alto (ID # 10713) City Council Staff Report Report Type: Consent Calendar Meeting Date: 10/21/2019 City of Palo Alto Page 1 Summary Title: City of Palo Alto Utilities Rules and Regulations Changes Title: Adoption of a Resolution Amending Utilities Rules and Regulations 2 (Description and Abbreviations), 3 (Description of Utility Services), 4 (Application of Service), 7 (Deposits), 8 (Access to Premises), 9 (Disconnection, Termination and Restoration of Service), 13 (Shortage of Supply and Interruption of Service), 15 (Metering), 16 (Line Extension), 18 (Utility Service and Facilities on Customer Premises), 20 (Special Electric Utility Regulations), 21 (Special Water Utility Regulations), 22 (Special Gas Utility Regulations), 23 (Special Wastewater Utility Regulations), 24 (Special Refuse Service Regulations), 25 (Special Storm and Surface Water Drainage Utility Regulations), and 29 (Net Energy Metering Service, Billing and Interconnection) From: City Manager Lead Department: Utilities Recommendation Staff recommends that Council adopt the Resolution (Attachment A) amending Utilities Rules and Regulations 2, 3, 4, 7, 8, 9, 13, 15, 16, 18, 20, 21, 22, 23, 24, 25 and 29, as attached. Executive Summary Utilities Rules and Regulations (Rules) are updated as needed to ensure current procedures are in place to continue City of Palo Alto Utilities (CPAU) operations. The recommended changes to the various Rules and Regulations add new provisions, remove outdated sections, update language for clarity, and reflect changes to applicable regulations, business practices and procedures. Background Utilities staff updates the Rules on a periodic basis to reflect current operational procedures and provide language clarification. The Rules have been updated three times in the past 13 years. Only significant program or policy changes are brought forward to the UAC for review and discussion such as (Rule 29) NEM 2.0 (UAC Report 10-5-16), (Rule 11) Water Leak Credit (UAC Report 12-6-17), and (Rule 20) Special Facilities Fees (UAC Report 4-9-19). Most of the City of Palo Alto Page 2 changes do not impact long range planning, policies or programs. The changes mainly reflect daily operational changes and procedures that are currently in place. Discussion Twenty-nine Utilities Rules set forth the conditions under which the City provides utility services from both the Utilities Department (electric, natural gas, water, wastewater, fiber optic) and the Public Works Department (refuse, storm drain). The Rules are updated on as- needed basis to reflect current standards and business practices, and to streamline language to make the rules more user-friendly and provide for ease of administration. Each of the Rules below includes changes reflecting this approach; additional specific edits are noted below, and redlined copies of each rule are available online with links provided in Attachment B. Utilities Rules and Regulations (2, 3, 4, 7, 8, 9, 13, 15, 16, 18, 20, 21, 22, 23, 24, 25 and 29) Utilities Rule and Regulation 2 (Definitions and Abbreviations) Rule and Regulation 2 describes commonly used industry acronyms and the definitions of various terms used throughout Rules. Some terms were not previously defined in the section and the rule is being revised to include these terms, including proposed amendments to add and/or update the definitions for Net Energy Metering and other NEM-related program terms, Energy Storage Facility, Private Lateral, Sewer Lateral, Upper Sewer Lateral, and Lower Sewer Lateral. Utilities Rule and Regulation 3 (Description of Utility Services) The recommended amendments to Rule 3 offer minor edits to aspects of electric service delivery and equipment requirements, as well as additional information about how CPAU can assist customers in identifying acceptable screening options for electric service equipment. Utilities Rule and Regulation 4 (Application for Service) The recommended amendments to Rule 4 clarify aspects of the application process for new customers of City utilities services. Utilities Rule and Regulation 7 (Deposits) The recommended amendments to Rule 7 include a provision to waive the deposit requirement for customers with an “Excellent” credit rating when moving from one premise to another and limits the deposit return to names on listed on the customer account. Utilities Rule and Regulation 8 (Access to Premises) The recommended amendments to Rule 8 generally clarify access requirements needed to provide service and stipulate that access to the premises is also required for contractors hired by CPAU or applicants who have a need to access utility facilities as required for new service connections. City of Palo Alto Page 3 Utilities Rule and Regulation 9 (Disconnection, Termination, and Restoration of Service) The recommended amendments to Rule 9 clarify procedures governing service disconnection and termination, provide updated information on how to contact CPAU for averting discontinuation of service for nonpayment, and set forth billing adjustment policies required for consistency with state law. Utilities Rule and Regulation 13 (Shortage of Supply and Interruption of Utility Services) The recommended amendments to Rule 13 update the situations in which CPAU may schedule customer-requested service and allows customers to request work-related service interruptions outside of normal business hours, subject to conditions and cost-recovery. Utilities Rule and Regulation 15 (Metering) The recommended amendments to Rule 15 stipulate that meter locations must comply with Utility Standards, and updates requirements for meter test deposit waivers. The proposed changes include a new section addressing water meters for Multi-unit Structures constructed after January 1, 2018, for consistency with state law. Utilities Rule and Regulation 16 (Line Extensions) The recommended amendments to Rule 16 address upgrading utility infrastructure in developed areas with undersized facilities. Utilities Rule and Regulation 18 (Utility Service and Facilities on Customer Premises) The recommended amendments to Rule 18 specify additional requirements for certain specific types of service, including sewer backwater valves, gas house-line stub outs, shutoff valves and by-pass facilities. The amendments also clarify the ownership of and responsibility for various types of CPAU facilities. Utilities Rule and Regulation 20 (Special Electric Utility Regulations) The recommended amendments to Rule 20 clarify equipment installation responsibilities and describe situations in which special facilities charges may apply. The attached Rule 20 reflects changes Council recently approved via (City Council Staff Report #10230 9-16-19), which added Section K, Neighborhood Funding of Subsurface Equipment. Utilities Rule and Regulation 21 (Special Water Utility Regulations) The recommended amendments to Rule 21 update (1) the number of services allowed for a building or other Customer Premises, (2) that other water sources such as reclaimed water and shall be used for consolidation of backfill and other nondomestic uses in construction sites if available, and (3) that Backflow Protection Assembly Testers must be registered with CPAU. The proposed amendment also changes the dollar value threshold which triggers water service upgrades on new residential construction or remodeling projects. Customers are currently required to upgrade the water service’s current standard size and/or material when the existing material is non-plastic or copper and when the construction/remodel cost is City of Palo Alto Page 4 greater than $100,000 for residential projects and $300,000 for commercial projects. The amendment increases the residential requirement threshold from $100,000 to $200,000. The current requirement threshold of $300,000 for commercial projects remains the same. Utilities Rule and Regulation 22 (Special Gas Utility Regulations) The recommended amendments to Rule 22 clarify the customer’s responsibility to ensure existing gas facilities on the customer’s property are capable of being maintained by CPAU and describe situations when rerouting, permitting and inspection costs will be the customer’s responsibility. Utilities Rule and Regulation 23 (Special Wastewater Utility Regulations) The recommended amendments to Rule 23 remove duplicative discharge requirements for liquid waste and update requirements for industrial discharges. The amendments also clarify the responsibilities of the City and the customer for wastewater infrastructure, including sewer laterals, the wastewater main, and sewer cleanouts (present or not present) in the Public-Right-of-Way, private property, and inside an easement. The recommended amendment replaces the original upgrade requirement for compromised sewer laterals serving new construction or remodels, with a requirement that Lower Sewer Laterals must be replaced if the Lower Sewer Lateral must be realigned and reconnected to the Wastewater Main at a new location as a result of the new construction or remodel. The proposed changes to the Sewer Backflow Protection requirement reflect the recent modifications to Chapter 16.08.110 Section 710.1 of the Municipal Code that require the installation of an approved backwater valve per the latest adopted version of the California Plumbing Code to protect from backflow of sewage fixtures installed on floor levels that are considered ground level or lower. Utilities Rule and Regulation 24 (Special Refuse Service Regulations) The recommended amendments to Rule 24 clarify aspects of refuse and recycling services and fees, and eliminate duplicate information and requirements currently provided for in municipal code Chapter 5.20. Utilities Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) The recommended amendments to Rule 25 make minor edits to update the name of the stormwater management fee and clarify that renovations are included in the description of developed parcels. Utilities Rules and Regulation 29 (Net Energy Metering Service Billing and Interconnection) The recommended amendments to Rule 29 update language related to the Net Energy Metering (NEM) services offered by the City to reflect changes in the program rules effective January 1, 2018. City of Palo Alto Page 5 Resource Impact Approval of changes to Utilities Rules and Regulation 2, 3, 4, 7, 8, 9, 13, 15, 16, 18, 20, 21, 22, 23, 24, 25 and 29 will not result in a significant change in net operating revenues or expenses. Policy Implications These recommendations do not represent a change in current City policies. Environmental Review The adoption of the resolution amending Utility Rules and Regulations does not meet the definition of a “project” under Public Resources Code 21065 or CEQA Guidelines Section 15378(b)(2), thus no CEQA review of this action is required. Attachments: • Attachment A: Resolution • Attachment B: Rules and Regulations Hyperlink List ATTACHMENT A *Not Yet Approved* 6055259 Resolution No. __________ Resolution of the Council of the City of Palo Alto approving Amendments to Utilities Rule and Regulation 2 (Definitions and Abbreviations), Utilities Rule and Regulation 3 (Description of Utility Services), Utilities Rule and Regulation 4 (Application for Service), Utilities Rule and Regulation 7 (Deposits), Utilities Rule and Regulation 8 (Access to Premises), Utilities Rule and Regulation 9 (Disconnection, Termination, and Restoration of Service), Utilities Rule and Regulation 13 (Shortage of Supply and Interruption of Utility Services), Utilities Rule and Regulation 15 (Metering), Utilities Rule and Regulation 16 (Line Extensions), Utilities Rule and Regulation 18 (Utility Service and Facilities on Customer Premises), Utilities Rule and Regulation 20 (Special Electric Utility Regulations), Utilities Rule and Regulation 21 (Special Water Utility Regulations), Utilities Rule and Regulation 22 (Special Gas Utility Regulations), Utilities Rule and Regulation 23 (Special Wastewater Utility Regulations), Utilities Rule and Regulation 24 (Special Refuse Service Regulations), Utilities Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations), Utilities Rule and Regulation 29 (Net Energy Metering Service, Billing and Interconnection) The Council of the City of Palo Alto does hereby RESOLVE as follows: Section 1. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rule and Regulation 2 (Definitions and Abbreviations) is hereby amended as attached and incorporated. Utility Rule and Regulation 2, as amended, shall become effective October 21, 2019. Section 2. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utility Rule and Regulation 3 (Description of Utility Services) is hereby amended as attached and incorporated. Utility Rule and Regulation 3, as amended, shall become effective October 21, 2019. Section 3. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 4 (Application for Service) is hereby amended as attached and incorporated. Utility Rule and Regulation 4, as amended, shall become effective October 21, 2019. Section 4. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 7 (Deposits) is hereby amended as attached and incorporated. Utility Rule and Regulation 7, as amended, shall become effective October 21, 2019. ATTACHMENT A *Not Yet Approved* 6055259 Section 5. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 8 (Access to Premises) is hereby amended as attached and incorporated. Utility Rule and Regulation 8, as amended, shall become effective October 21, 2019. Section 6. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 9 (Disconnection, Termination and Restoration of Service) is hereby amended as attached and incorporated. Utility Rule and Regulation 9, as amended, shall become effective October 21, 2019. Section 7. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 13 (Shortage of Supply and Interruption of Utility Services) is hereby amended as attached and incorporated. Utility Rule and Regulation 13, as amended, shall become effective October 21, 2019. Section 8. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 15 (Metering) is hereby amended as attached and incorporated. Utility Rule and Regulation 15 as amended, shall become effective October 21, 2019. Section 9. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 16 (Line Extensions) is hereby amended as attached and incorporated. Utility Rule and Regulation 16, as amended, shall become effective October 21, 2019. Section 10. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 18 (Utility Service and Facilities on Customer Premises) is hereby amended as attached and incorporated. Utility Rule and Regulation 18, as amended, shall become effective October 21, 2019. Section 11. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 20 (Special Electric Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 20, as amended, shall become effective October 21, 2019. Section 12. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 21 (Special Water Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 21, as amended, shall become effective October 21, 2019. Section 13. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 22 (Special Gas Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 22, as amended, shall become effective October 21, 2019. ATTACHMENT A *Not Yet Approved* 6055259 Section 14. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 23 (Special Wastewater Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 23, as amended, shall become effective October 21, 2019. Section 15. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 24 (Special Refuse Service Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 24, as amended, shall become effective October 21, 2019. Section 16. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 25 (Special Storm and Surface Water Drainage Utility Regulations) is hereby amended as attached and incorporated. Utility Rule and Regulation 25, as amended, shall become effective October 21, 2019. Section 17. Pursuant to Section 12.20.010 of the Palo Alto Municipal Code, Utilities Rule and Regulation 29 (Net Energy Metering Service, Billing and Interconnection) is hereby amended as attached and incorporated. Utility Rule and Regulation 29, as amended, shall become effective October 21, 2019. // // // // // // // // // // // // ATTACHMENT A *Not Yet Approved* 6055259 Section 18. Council finds that the adoption of this resolution amending Utility Rules and Regulations does not meet the definition of a “project” under Public Resources Code 21065 or CEQA Guidelines Section 15378(b)(2), thus no CEQA review of this action is required. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: APPROVED: ____________________________ _________________________________ City Clerk Mayor APPROVED AS TO FORM: _________________________________ City Manager ____________________________ Assistant City Attorney _________________________________ Director of Utilities ATTACHMENT B ID# 10713 Adoption of a Resolution Amending Utilities Rules and Regulations 2 (Description and Abbreviations), 3 (Description of Utility Services), 4 (Application of Service), 7 (Deposits), 8 (Access to Premises), 9 (Disconnection, Termination and Restoration of Service), 13 (Shortage of Supply and Interruption of Service), 15 (Metering), 16 (Line Extension), 18 (Utility Service and Facilities on Customer Premises), 20 (Special Electric Utility Regulations), 21 (Special Water Utility Regulations), 22 (Special Gas Utility Regulations), 23 (Special Wastewater Utility Regulations), 24 (Special Refuse Service Regulations), 25 (Special Storm and Surface Water Drainage Utility Regulations), and 29 (Net Energy Metering Service, Billing and Interconnection) RULE AND REGULATION 2 - DEFINITIONS AND ABBREVIATIONS RULE AND REGULATION 3 - DESCRIPTION OF UTILITY SERVICES RULE AND REGULATION 4 - APPLICATION FOR SERVICE RULE AND REGULATION 7 - DEPOSITS RULE AND REGULATION 8 - ACCESS TO PREMISES RULE AND REGULATION 9 - DISCONNECTION, TERMINATION AND RESTORATION OF SERVICE RULE AND REGULATION 13 - SHORTAGE OF SUPPLY AND INTERRUPTION OF UTILITY SERVICES RULE AND REGULATION 15 - METERING RULE AND REGULATION 16 - LINE EXTENSIONS RULE AND REGULATION 18 - UTILITY SERVICE AND FACILITIES ON CUSTOMER PREMISES RULE AND REGULATION 20 - SPECIAL ELECTRIC UTILITY REGULATIONS RULE AND REGULATION 21 - SPECIAL WATER UTILITY REGULATIONS RULE AND REGULATION 22 - SPECIAL GAS UTILITY REGULATIONS RULE AND REGULATION 23 - SPECIAL WASTEWATER UTILITY REGULATIONS RULE AND REGULATION 24 - SPECIAL REFUSE SERVICE REGULATIONS RULE AND REGULATION 25 - SPECIAL STORM AND SURFACE WATER DRAINAGE UTILITY REGULATIONS RULE AND REGULATION 29 - NET ENERGY METERING SERVICE, BILLING AND INTERCONNECTION City of Palo Alto (ID # 10612) City Council Staff Report Report Type: Action Items Meeting Date: 10/21/2019 City of Palo Alto Page 1 Council Priority: Transportation and Traffic Summary Title: Old Palo Alto RPP Program Resolution and Approval of Related Contract Amendments Title: PUBLIC HEARING: Adoption of a Resolution Establishing a new Residential Preferential Parking (RPP) Program in the Old Palo Alto Neighborhood; Approval of Amendments to Contract Number C15156501 With SP Plus for Permit Processing With Increased Compensation of $6,000 and Contract Number C15156763 With Serco, Inc. for Parking Enforcement to add Services for the Old Palo Alto RPP District With Increased Compensation of $35,070.40; and Approval of a Budget Amendment in the Residential Parking Permit (RPP) Fund From: City Manager Lead Department: Transportation Recommendation Staff recommends that the City Council conduct a public hearing and take the following actions: 1. Find the program exempt from review under the California Environmental Quality Act (CEQA); and, 2. Adopt a resolution to implement the Old Palo Alto Residential Preferential Parking (RPP) Program (Attachment A) as a one-year pilot; and, 3. Approve and authorize the City Manager, or his designee, to execute Amendment No. 5 to Contract C15156501 (Attachment C) with SP Plus in the amount of $6,000 for Additional Services for Parking Permits and On-Site support for a total contract amount not to exceed $762,793, and, City of Palo Alto Page 2 4. Approve and authorize the City Manager, or his designee, to execute Amendment No. 5 to Contract C15156763 (Attachment D) with Serco, Inc. in the amount of $35,070.40 for Parking Enforcement for a total contract amount not to exceed $2,471,064.40, and 5. Amend the Fiscal Year 2020 Budget Appropriation Ordinance for the Residential Parking Permit (RPP) Fund by: a. Increasing the revenue estimate for Residential Parking Permit operations by $14,000; and, b. Increasing the expenditure appropriation for Residential Parking Permit operations by $41,000; and, c. Decreasing the ending fund balance in the Residential Parking Permit (RPP) Fund General Fund Budget Stabilization Reserve by $27,000. On August 28, 2019, the Planning and Transportation Commission (PTC) recommended, with comments, the establishment of the Old Palo Alto RPP district. Executive Summary Beginning in early 2014, the City has actively addressed city-wide parking and transportation challenges using a strategic, multi-faceted approach focused on parking management, parking supply, and transportation demand management programs. Parking management strategies have included the development of a city-wide Residential Preferential Parking (RPP) ordinance, which was adopted in December 2014, as well as the establishment of a new RPP district in residential areas surrounding Downtown and California Avenue. The city-wide RPP ordinance includes guidelines and a process for neighborhoods to petition and request a new RPP district, or to request annexation into an existing RPP district. In August 2018, the City formally received a petition from residents of the Old Palo Alto neighborhood with a request to initiate an RPP program in their neighborhood due to parking intrusion from activities west of the train tracks. On March 27, 2019, the PTC reviewed the petition and prioritized the Old Palo Alto RPP petition among other petitions received. On May 13, 2019, in reviewing a list of other recommendations related to the City’s overall parking programs, the City Council confirmed the prioritization of the Old Palo Alto RPP district and asked staff to proceed with the next steps of community engagement and outreach. On July 31, 2019, staff conducted a community workshop at the Jerry Bowden Park in the Old Palo Alto neighborhood to introduce the RPP concept to neighborhood residents and property owners. As a follow up to the community workshop, staff sent out the required survey related to the proposed Old Palo Alto RPP. There was only one survey per household. As of August 19, 2019, City of Palo Alto Page 3 staff received 55 returned surveys with 49 votes in favor of RPP implementation in Old Palo Alto as described in the survey. Consistent with the survey, the attached draft resolution would establish an RPP district within the following block segments: Block Beginning Block End Washington Avenue Alma Street Emerson Street N. California Avenue High Street Ramona Street Nevada Avenue High Street Ramona Street Ramona Street Washington Avenue Oregon Avenue Emerson Street Washington Avenue Oregon Avenue High Street Washington Avenue Oregon Avenue Within that area, two-hour parking would be allowed on-street during the hours between 8:00 am and 5:00 pm, and only vehicles displaying a valid permit could park for longer during those hours. Residents would be eligible to obtain up to five transferable hang tag permits at a cost of $50 each. Residents may purchase up to 50 daily guest permits annually. Each guest permit costs $5. If the City Council approves the resolution as drafted, staff would arrange for sign installation and sell permits with the goal to begin enforcement in November 2019. The program is envisioned as a one-year pilot, and adjustments could be made based on experiences during that year. Background Per the Palo Alto Municipal Code § 10.50.050, residents may self-organize and request the formation of an RPP district in their neighborhood. The process, as outlined in the Ordinance, is as follows: (a) Form of Application. (1) The director shall establish a standard form for the application for the formation of a new RPP District, as well as a list of submittal requirements for use by interested residents. These requirements shall include a narrative describing the nature and perceived source of non-residential parking impact, as well as suggested district boundaries. The director shall also approve a standard form for use in demonstrating resident support for the application. (2) Residents shall initiate a request for establishment of an RPP District by neighborhood petition by completing the official application form. City of Palo Alto Page 4 (3) Residents are encouraged to consult with the employers and employees thought to be the source of the parking impact as they develop their proposals. (b) Timing and Review of Applications. Each calendar year, the director of planning and community environment1 shall review all applications received prior to March 31st of that year to determine whether the RPP District criteria established in this Chapter are met. (c) Prioritization of Applications. Applications determined by the director to meet the criteria in paragraph (b) above shall be presented to the planning and transportation commission. The commission shall review the requests and recommend to the director which proposal or proposals should be given priority for review and possible implementation in the current calendar year. In making its recommendations, the commission shall consider the severity of non-residential parking impact, the demonstrated level of neighborhood support, and the staff resources needed to process requests. (d) Staff Review of Applications and Community Outreach. Once an application has been selected for council consideration during the current calendar year, staff shall promptly review the application, gather additional information and conduct a community outreach program. At a minimum the review process shall include the following: (1) The city shall complete parking occupancy studies to quantify the nature of the problem identified in the petition. Data shall be collected when schools in the Palo Alto Unified School District and Stanford University are in session, unless these institutions are irrelevant to the problem to be addressed. (2) Upon completion of the consultation and outreach process, the city attorney shall prepare a draft resolution containing the proposed boundaries and hours of enforcement. Staff shall undertake a survey of resident support within the RPP District. The results of this survey shall be included in and reported to the planning and transportation commission and the city council. (e) Planning and Transportation Commission Review. Staff shall bring the proposed RPP District to the planning and transportation commission no later than September of the calendar year in which consideration began. The commission shall review the draft resolution at a noticed public hearing and make a recommendation to the city council regarding the RPP District. This recommendation may include proposed modifications of the boundaries. The commission's recommendation shall be forwarded to the city council no later than September 30th. 1 Now, Chief Transportation Official. City of Palo Alto Page 5 As of the March 31 petition deadline, staff received three petitions total, including one from the Old Palo Alto neighborhood. The Old Palo Alto petition was for a resident-only parking program. College Terrace is the only other resident-only parking program in Palo Alto. Residents noted parking overflow on weekdays and attributed the parking impacts to employees of neighboring businesses, employees from nearby office buildings, and Caltrain commuters. Residents also noted safety concerns which impacted bike routes in the neighborhood. Staff presented this petition, along with two others, to the Planning and Transportation Commission (PTC) on March 27 for prioritization, as required in the city-wide RPP ordinance. The PTC voted 5-0-2 to prioritize the Old Palo Alto neighborhood for further data collection and program design. Parking Occupancy Study On April 16-18, 2019 (prior to California Avenue surface lot closures), the City’s Parking Operations Lead conducted parking occupancy surveys during three time periods: 9:00 am - 10:00 am, 12:00 - 1:00 pm, and 3:00 - 4:00 pm. The survey area was bounded by Alma St, Santa Rita Avenue, Bryant Street, and Oregon Avenue. In the Old Palo Alto neighborhood, the occupancy survey documents the highest average occupancy rates over 75% on the following blocks: 2200 – 2300 High Street 2200 - 2300 Emerson Street 100-200 N. California Avenue 100 – 200 Nevada Avenue The data shows high occupancy on the blocks closest to the California Avenue underpass. This high occupancy begins in the morning and continues through mid-day, only decreasing in the evening. Overall, the mid-day period appears to have the most demand for parking, as the majority of the adjacent streets within the surveyed area are at or above 50% occupancy at this time. In the nearby California Avenue shopping district, surface parking Lot C-7 was closed for garage construction on April 22, 2019. The new garage is currently scheduled to be ready for use on July 16, 2020. In order to mitigate the impacts of the closure, staff reconfigured surface Lot C-6 to incorporate more spaces, leased the Santa Clara County Public Defender’s lot, implemented a valet parking program, and leased 44 spaces from the Caltrain lot (for use by the garage contractor). To analyze the impacts of the lot closure on the proposed Old Palo Alto RPP, staff conducted an additional occupancy survey after the closure of this surface lot and found minimal change in parking occupancy. This is relevant to a PTC request below. City of Palo Alto Page 6 Parking occupancy data is included as Attachment B. Community Workshop In the evening of July 31, staff convened a community workshop in the neighborhood at Jerry Bowden Park to introduce the concept of the Old Palo Alto RPP program to neighborhood residents and property owners. Staff presented information on the city-wide RPP ordinance, parameters of the existing RPP districts and gathered feedback from attendees on the conceptual Old Palo Alto RPP program. Feedback varied, but some of the key topics included: Number of resident parking permits per household Types and prices of resident parking permits Opt-in procedures for connecting blocks Implementation schedule RPP Survey On August 6, staff mailed out 93 surveys to all residential properties and property owners within the proposed RPP district (one survey per household). The surveys were due back to the City by the end of the day on August 19, 2019. As of August 19, staff received 55 returned surveys with 49 votes in favor of RPP implementation as described in the survey. The RPP program design elements included in the mail survey are listed below: • Permits would be required to park any vehicle on-street in excess of two (2) hours Monday through Friday between 8:00 a.m. and 5:00 p.m. • Households within the Old Palo Alto RPP district (red areas) would be eligible for five (5) annual hang tag permits at the cost of $50 each. • Residents could also purchase up to 50 transferable one-day permit hangtags per year for $5 each. The transferable hangtags may be used on any vehicle, including household visitor vehicles. Table 1 contains the mail survey results. Table 1: Results of Old Palo Alto RPP Program Mail Survey Area To t a l Ma i l e d Ou t To t a l Re t u r n e d YE S Re s p o n s e NO Re s p o n s e No t Re t u r n e d YE S Re s p o n s e R a t e To t a l Re t u r n e d R a t e Total 93 55 49 6 38 89% 59% The five (5) annual resident permits program guidelines included in this program design was held to resemble the City’s three most recent RPP programs: Downtown RPP six permits, City of Palo Alto Page 7 Evergreen Park-Mayfield RPP five permits, and Southgate RPP six permits. Thus, keeping this similar to other recent RPP districts is aligned with reducing administrative differences in RPP districts. In addition, the five annual resident permits were voted for by the residents (note that they possibly would have voted for fewer). However, it should be noted that although five or six permits have been included in these program designs, RPP residents across these programs only average the purchase of 2.5 permits per household. Planning and Transportation Commission (PTC) Discussion Summary The Planning and Transportation Commission (PTC) reviewed this item (meeting minutes - https://www.cityofpaloalto.org/civicax/filebank/documents/73632) on August 28, 2019. The PTC voted 4-2 (and one recusal) to recommend approval of the Old Palo Alto RPP to Council with added recommendations. Some of the concerns raised included the impacts of the California Avenue garage construction, the lack of metrics set to determine when or if an RPP should occur, and whether RPP’s are the best use of parking as a resource. Additionally, the threshold for parking occupancy was a discussion topic among the PTC. With comments, the PTC supported the pilot program, and the recommendation requested that staff include information on the following items: a. The RPP Pilot evaluation success criteria and the timeline for the evaluation of this RPP in the report to Council. b. Impact of the California Avenue Garage construction on this RPP district. c. Number of hangtags: need to include a justification for the number of hangtags during this pilot period. d. Staff needs to review creative alternatives to RPP implementation. Staff has incorporated responses to these comments and requests in this staff report. Discussion Staff used the results of the initial data collection and the community workshop to begin drafting the Old Palo Alto RPP program structure. Important elements considered included the following: What areas should be included in the RPP district? During which hours should the RPP program be enforced? How should enforcement be accomplished? What types of resident parking permits should be issued, how much should they cost, and what quantity will each household be permitted to purchase? Should the RPP program include eligibility areas to the north and east or should it be assumed that these neighborhoods would be part of future RPP programs? City of Palo Alto Page 8 Given the overall RPP program recommendations from the Municipal Resource Group (MRG) report, how can this RPP program be initially built to be more sustainable, easier to administer, and not in conflict with any of the report recommendations? District Boundaries Staff recommends the following block segments for the Old Palo Alto RPP: Block Beginning Block End Washington Avenue Alma Street Emerson Street N. California Avenue High Street Ramona Street Nevada Avenue High Street Ramona Street Ramona Street Washington Avenue Oregon Avenue Emerson Street Washington Avenue Oregon Avenue High Street Washington Avenue Oregon Avenue All streets within these boundaries should be part of the Old Palo Alto RPP district and all households within these blocks should be eligible for resident parking permits. While the petition submitted by residents in August 2018 included an area bounded by Alma Street, Santa Rita Avenue, Bryant Street, and Oregon Avenue, staff believes the initial RPP district will include areas with the highest parking intrusion. This decision was reached after discussing various other scenarios with residents and stakeholders. Staff also believes it is necessary to make eligible (blue) connecting adjacent blocks for annexation during the pilot phase of the program. City of Palo Alto Page 9 Figure 1: Proposed Old Palo Alto RPP District Boundaries Source: Palo Alto Office of Transportation, August 2019 Enforcement Hours The proposed Old Palo Alto RPP hours are Monday through Friday from 8:00 am to 5:00 pm. Old Palo Alto RPP parking permits would be required to park any motor vehicle on-street in excess of two (2) hours during these enforcement hours. Resident Parking Permits Staff recommends that all Old Palo Alto RPP district households should be eligible for five (5) annual resident parking permit hang tags at a cost of $50 each. Up to 50 transferable one-day resident parking permit hangtags per year for $5 each. The transferable resident parking permit hangtags may be used on any vehicle, including household visitor vehicles. Eligibility Areas Staff recommends the establishment of Eligibility Areas for the Old Palo Alto RPP program. Eligibility Areas are streets just outside of the designated RPP district that can administratively City of Palo Alto Page 10 opt into the program when their blocks begin to experience increase parking occupancy. This allows the program to expand quickly to address spillover from the designated RPP district. RPP Pilot Evaluation Timing and Success Criteria: This one-year pilot program is designed to run from Nov. 1, 2019 through Oct. 31, 2020. To review pilot program outcomes, staff will conduct an occupancy survey in March-May 2020. Staff will target a return to Council prior to the pilot program’s end date for review in July- August 2020. The RPP programs are designed to reduce the impact of non-resident vehicles, as set forth in Palo Alto Municipal Code § 10.50.030. As such, the current criteria for evaluation of program success is that the residents are content with program outcomes (non-resident parking impacts are lessened) and wish to continue the program. Staff intends to bring items to PTC per the MRG recommendation #27 (from the 6/24/2019 City Council Report #10464-Parking Work Plan) to discuss parking availability standards and RPP program guidelines. The MRG recommendation #27 states: Establish “Parking Availability Standards” – Parking availability standards should be established for the Downtown, Evergreen Park-Mayfield, and Southgate Residential Permit Parking Districts considering the residents’ perceptions of the impact of parking availability on their quality of life. Changes in the number of employee permits and boundaries of existing RPP districts should be deferred until parking availability standards are approved by the City Council. In addition to MRG recommendation #27, the MRG report also recommended that staff work with PTC to consider the following general RPP items: reducing the number of RPP employee permits, providing automatic renewal of employee parking permits, increasing the cost of employee permits, standardizing employee permit costs between RPP districts, changing the payment schedule and increasing the cost of reduced-price permits, removing inconsistencies between RPP districts, and reviewing renewal dates. Discussion about other creative parking solutions, etc. will come as part of these MRG recommendations where appropriate. Old Palo Alto RPP Resolution The Old Palo Alto RPP resolution is included as Attachment A. It provides for the implementation of the Old Palo Alto RPP program as a one-year pilot by enacting the following measures: Establishes Old Palo Alto RPP District boundary (included in Attachment A). Permits would be required to park any vehicle on-street in excess of two (2) hours, Monday through Friday between 8:00 a.m. and 5:00 p.m. City of Palo Alto Page 11 Households within the Old Palo Alto RPP district (red areas) would be eligible for five (5) annual hang tag permits at the cost of $50 each. Residents could also purchase up to 50 transferable one-day permit hangtags per year for $5 each. The transferable hangtags may be used on any vehicle, including household visitor vehicles. Additional Services The implementation of this new district requires amending the existing contracts with SP Plus and SERCO in order to provide needed services to administer the program. More details about each of these contracts is below. This report recommends amendments to two contracts that will support the implementation of the Old Palo Alto RPP. Amendment Five to Contract No. C15156501: SP Plus (Attachment C) The formation of the Old Palo Alto RPP District necessitates the extension of services of SP Plus. SP Plus is the current system provider for the RPP program. The City is actively working to implement a new system, but in the meantime, the current system needs to be expanded to accommodate this new RPP program. The amendment provides Permit Fulfillment/Customer Support for the Old Palo Alto RPP, including on-site customer service support at City Hall on a regular basis. On-site service assists those customers that do not have email addresses or aren’t as comfortable navigating the internet. The amendment will also extend the term of the agreement to September 15, 2020. Staff would extend to the end of the pilot if the launch of the new permit system is delayed. Amendment Five to Contract No. C15156763: Serco Inc. (Attachment D) Serco is the contractor that provides parking enforcement for our RPPs that have day-time parking restrictions. The proposed contract amendment will enable Serco to hire, train and equip 0.5 new officer to provide parking enforcement in the Old Palo Alto RPP District. The amendment will also extend the term of the contract four months, to March 30, 2020. With the proposed amendment, a total of eight officers will be enforcing four RPP districts. Staff is actively working on the procurement process to advertise for an updated enforcement contract. Staff anticipates completing by early March 2020, before the expiration of this current contract with this amendment. Policy Implications The following Comprehensive Plan goals, programs, and policies are relevant to the implementation of the Old Palo Alto RPP program: POLICY T-2: City of Palo Alto Page 12 Consider economic, environmental, and social cost issues in local transportation decisions. POLICY T-47: Protect residential areas from the parking impacts of nearby business districts. PROGRAM T-53: Discourage parking facilities that would intrude into adjacent residential neighborhoods. Resource Impact A budget amendment ordinance is included in this report and recommended to align the revenue and expense appropriation in the Residential Parking Permit Fund with anticipated activity levels of the Old Palo Alto RPP district. The Old Palo Alto RPP budget conservatively assumes $14,000 in revenue from permit sales and parking citations and is anticipated to partially offset program costs. In total, $75,500 is necessary to stablish the Old Palo Alto RPP district and includes costs to install signs, order/print hangtag permits, provide permit fulfillment through a website, associated customer service, and increased parking enforcement. This includes $41,000 for amendments to the SP Plus and Serco contracts for permitting services and enforcement, as detailed in this report and summarized below. The FY 2020 Budget does not include funding for this activity; therefore, a budget amendment for this amount is recommended. An additional $34,500 ($5,000 ongoing) is anticipated for the initial furnishing and installation of the additional signage. Funding is available in the Parking District Implementation project in the Capital Improvement Fund (PL-15003) for these costs in FY 2020. SP Plus Amendment Five to Contract No. C15156501 $ 6,000.00 Serco Amendment Five to Contract No. C15156763 $ 35,070.40 TOTAL $ 41,070.40 Staff will monitor revenues and expenses in the fund during Fiscal Year 2020. Based on actual experience, staff may bring forward budget adjustments, including but not limited to increase permit fees, in the Fiscal year 2021 budget process. As shown above, this program is not a cost recovering program, like other RPP districts. Timeline Upon approval of the resolution and respective contract amendments, City staff will be able to disseminate information to neighborhood residents about how to purchase permits. Signs will City of Palo Alto Page 13 also be installed in the area such that enforcement can begin in November 2019. Environmental Review This program is exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of Title 14 of the California Code of Regulations since it can be seen with certainty that there is no possibility the adoption and implementation of this program may have a significant effect on the environment and Section 15301 in that this proposed resolution will have a minor impact on existing facilities. Attachments: Attachment A - Resolution to Establish Old Palo Alto RPP (PDF) Attachment B - Old Palo Alto Occupancy Report (XLSX) Attachment C - SP Plus C15156501 (PDF) Attachment D - Serco C15156763 (PDF) *Yet to be Approved* 1 Resolution No. _____ Resolution of the Council of the City of Palo Alto Establishing the Old Palo Alto Residential Preferential Parking District (RPP) R E C I T A L S A. California Vehicle Code Section 22507 authorizes the establishment, by city council action, of permit parking programs in residential neighborhoods for residents and other categories of parkers. B. On December 15, 2014, the Council adopted Ordinance No. 5294, adding Chapter 10.50 to Title 10 (Vehicles and Traffic) of the Palo Alto Municipal Code, which established the city-wide procedures for (RPP) districts in the city. C. On March 27, 2019, the Planning and Transportation Commission prioritized Old Palo Alto for Residential Preferential Parking program implementation. D. In August 2019, a stakeholders’ group comprised of Old Palo Alto residents met and made its recommendations to the City on the particular rules to be applied to the Old Palo Alto RPP District. E. On August 28, 2019, the Planning and Transportation Commission held a public hearing to consider the proposed Old Palo Alto Residential Preferential Parking program. F. It is the goal of the City to reduce the impacts of non-resident overflow parking from the commercial areas on the surrounding neighborhoods. G. The Council desires to establish the Old Palo Alto Residential Preferential Parking program pilot. NOW, THEREFORE, the Council of the City of Palo Alto RESOLVES, as follows: SECTION 1. Findings. The criteria set forth in Section 10.50.030 of the Palo Alto Municipal Code for designating a Residential Preferential Permit Zone have been met as follows: A. That non-resident vehicles do, or may, substantially interfere with the use of on-street or alley parking spaces by neighborhood residents in that based on observation there are few available parking spaces available midday, while the streets are relatively unoccupied at midnight thus demonstrating the parking intrusion is largely by nonresidents. B. That the interference by the non-resident vehicles occurs at regular and frequent intervals, either daily or weekly, in that the parking intrusion is most severe during daytime hours during the regular workweek. C. That the non-resident vehicles parked in the area of the District create traffic congestion, noise, or other disruption (including shortage of parking spaces for residents and their visitors) that disrupts neighborhood life in that based on information from residents and other city departments the vehicle congestion is interfering with regular activities. *Yet to be Approved* 2 D. Other alternative parking strategies are not feasible or practical in that the City has implemented a series of alternative parking strategies in the past and concurrently and there is still a shortage of parking available. SECTION 2. Definitions. A. “Dwelling Unit” shall have the same meaning as it is defined in Palo Alto Municipal Code Section 10.50.020. B. “Old Palo Alto Residential Preferential Parking Program District” or “District” shall be that area as shown in Exhibit A to this Resolution. SECTION 3. Parking Restrictions within the District. A. Two-hour Parking Limit and No Re-parking. In the areas within the District listed in Table 1, no person shall park a vehicle adjacent to any curb for more than two hours. Re- parking a vehicle more than two hours after initially parking on the same day in the District is prohibited. These restrictions shall be in effect Monday through Friday from 8:00 AM to 5:00 PM, except holidays as defined in Palo Alto Municipal Code Section 2.08.100. Vehicles properly displaying a valid Parking Permit as described in Section 4 of this Resolution are exempt from these restrictions. TABLE 1 STREET BLOCKS Washington Ave. Alma St. to Emerson St. North California Ave. High St. to Ramona St. Nevada Ave. High St. to Ramona St. Ramona St. Washington Ave. to Oregon Ave. Emerson St. Washington Ave. to Oregon Ave. High St. Washington Ave. to Oregon Ave. B. Exempt vehicles. Vehicles exempt from parking restrictions as described in Palo Alto Municipal Code Section 10.50.070(d) are exempt from the restrictions in this section. SECTION 4. Parking Permits. A. Resident Parking Permits. The City may issue Resident Parking Permits to residents of dwelling units within the District. Resident Parking Permits shall be subject to the following regulations: a. Duration. Resident Parking Permits shall be available in the form of annual permits and one-day permits. b. Form of Permit. The City may issue Resident Parking Permits in any form it deems practicable, including hangtags. c. Maximum Number of Permits per Dwelling Unit. Each dwelling unit within the District shall be limited to five Annual Resident Parking Permits at any given time. These permits may be used by residents or guests within the District. *Yet to be Approved* 3 d. Daily Resident Parking Permits. Each dwelling unit shall be limited to 50 Daily Resident Parking Permits annually. These permits may be in the form of scratcher hangtags, an online issuance system, or such other form as the City determines. The permit will state the date through which it is valid. SECTION 5. Fees. The fee for Parking Permits in the District shall be as follows unless amended by resolution or ordinance: Old Palo Alto RPP – Annual Resident Parking Permit $50.00 per year Old Palo Alto RPP – Daily Resident Parking Permit $5.00 per day SECTION 6. Existing Parking Restrictions. In the event City staff should, at a later time, discover conflicting parking restrictions within the District that conflict with the restrictions of this resolution, but are not expressly rescinded, the RPP restrictions of this resolution shall control. However, existing parking restrictions indicated by painted curbs and implemented pursuant to Vehicle Code section 21458 are not superseded by this Resolution and remain in effect. SECTION 7. Trial Period. The Trial Period for the District shall be for one year, and reevaluated at that time. The District shall remain in force until the City Council takes action to extend, modify, or rescind. The City Council shall consider whether to make the RPP District and its parking programs permanent, modify the District and/or their parking regulations, or terminate it no later than December 1, 2020. SECTION 8. CEQA. This Resolution is exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of Title 14 of the California Code of Regulations since it can be seen with certainty that there is no possibility the adoption and implementation of this resolution may have a significant effect on the environment and Section 15301 in that this proposed resolution will have a minor impact on existing facilities. // // // // // // // // *Yet to be Approved* 4 SECTION 9. Effective Date. This Resolution shall take effect immediately upon its passage. Enforcement shall commence, pursuant to Chapter 10.50 of Title 10 of the Palo Alto Municipal Code and the California Vehicle Code, when signage is posted. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: __________________________ __________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: _______________________ ___________________________ Assistant City Attorney City Manager ___________________________ Chief Transportation Official *Yet to be Approved* 5 EXHIBIT A Old Palo Alto RPP District Old Palo Alto RPP District in Red RPP Eligible Blocks in Blue RPP Interest Street Side Cross Cross Supply 16-Apr 17-Apr 18-Apr 29-Aug 1-High N. California N Alma High 6 3 4 5 6 1-High N. California N High Emerson 4 4 4 4 4 1-High Nevada N High Emerson 8 8 7 5 6 1-High Nevada S High Emerson 5 5 5 5 4 1-High Nevada N Emerson Ramona 9 7 7 4 5 1-High Nevada S Emerson Ramona 8 7 5 7 5 1-High Emerson E Washington N. California 5 3 4 4 4 1-High Emerson W Washington N. California 5 4 4 4 2 1-High Emerson E N. California Nevada 6 4 5 4 5 1-High Emerson W N. California Nevada 6 5 5 4 3 1-High Emerson E Nevada Oregon 12 6 4 7 8 1-High Emerson W Nevada Oregon 12 11 10 10 11 1-High High E Washington N. California 7 6 7 5 4 1-High High W Washington N. California 9 5 4 7 7 1-High High E N. California Nevada 5 4 5 5 5 1-High High E Nevada Oregon 14 14 13 13 11 1-High High W N. California Oregon 54 36 40 38 33 2-Med Washington N Alma High 5 4 3 2 2 2-Med Washington S Alma High 7 3 4 4 4 2-Med Washington N High Emerson 6 2 2 3 4 2-Med Washington S High Emerson 7 4 4 3 5 2-Med N. California N Emerson Ramona 7 5 5 4 4 2-Med Ramona E Washington N. California 4 0 0 0 2 2-Med Ramona W Washington N. California 6 0 0 1 3 2-Med Ramona E N. California Oregon 19 8 5 6 9 2-Med Ramona W N. California Nevada 5 3 1 1 3 2-Med Ramona W Nevada Oregon 12 6 5 5 6 3-Low Santa Rita N Alma Emerson 17 8 7 9 6 3-Low Santa Rita S High Emerson 7 3 3 4 5 3-Low Santa Rita S Alma High 7 2 4 4 3 3-Low Santa Rita N Emerson Bryant 18 6 7 7 11 3-Low Santa Rita S Emerson Bryant 19 5 6 5 8 3-Low Washington N Emerson Bryant 14 4 5 3 5 3-Low Washington S Emerson Ramona 8 5 4 5 3 3-Low Washington S Ramona Bryant 7 1 2 1 3 3-Low N. California N Ramona Bryant 7 1 1 1 2 3-Low Oregon N High Emerson 5 2 1 0 1 3-Low Oregon N Emerson Ramona 7 2 1 1 2 3-Low Oregon N Ramona Bryant 5 2 2 1 0 3-Low Bryant E Santa Rita N. California 15 13 12 10 14 3-Low Bryant W Santa Rita Washington 14 6 3 5 6 3-Low Bryant W Washington N. California 4 2 2 1 3 3-Low Bryant E N. California Oregon 21 9 5 11 7 3-Low Bryant W N. California Oregon 17 4 2 4 3 3-Low Emerson E Santa Rita Washington 11 7 4 3 4 3-Low Emerson W Santa Rita Washington 10 3 3 3 3 3-Low High E Santa Rita Washington 13 13 12 8 4 3-Low High W Santa Rita Washington 14 14 12 6 5 3-Day Demand Avg 3-Day Avg Occ % 4-Day Demand Avg 4-Day Avg Occ % 4 67%5 75% 4 100%4 100% 7 83%7 81% 5 100%5 95% 6 67%6 64% 6 79%6 75% 4 73%4 75% 4 80%4 70% 4 72%5 75% 5 78%4 71% 6 47%6 52% 10 86%11 88% 6 86%6 79% 5 59%6 64% 5 93%5 95% 13 95%13 91% 38 70%37 68% 3 60%3 55% 4 52%4 54% 2 39%3 46% 4 52%4 57% 5 67%5 64% 0 0%1 13% 0 6%1 17% 6 33%7 37% 2 33%2 40% 5 44%6 46% 8 47%8 44% 3 48%4 54% 3 48%3 46% 7 37%8 43% 5 28%6 32% 4 29%4 30% 5 58%4 53% 1 19%2 25% 1 14%1 18% 1 20%1 20% 1 19%2 21% 2 33%1 25% 12 78%12 82% 5 33%5 36% 2 42%2 50% 8 40%8 38% 3 20%3 19% 5 42%5 41% 3 30%3 30% 11 85%9 71% 11 76%9 66% Vers.: Aug. 5, 2019 Page 1 of 13 AMENDMENT NO. 5 TO CONTRACT NO. C15156501 BETWEEN THE CITY OF PALO ALTO AND SP PLUS CORPORATION This Amendment No. 5 (this “Amendment”) to Contract No. C15156501 (the “Contract”) is entered into as of ________________, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SP PLUS CORPORATION, a Delaware corporation (“CONSULTANT”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment. R E C I T A L S A. The Contract was entered into by and between the Parties hereto for the provision of design and implementation of a new hosted parking website which includes all information on permits, garages, as detailed therein. B. The Parties now wish to amend the Contract in order to extend the term and increase the compensation by $151,878.27 from $762,793.00 to $914,671.27. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree: SECTION 1. Definitions. The following definitions shall apply to this Amendment: a. Contract. The term “Contract” shall mean Contract No. C15156501 between CONSULTANT and CITY, dated March 16, 2015, as amended by: Amendment No.1, dated January 19, 2016 Amendment No.2, dated February 27, 2017 Amendment No.3, dated August 21, 2017 Amendment No.4, dated March 15, 2019 b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract. SECTION 2. Section 2. TERM of the Contract is hereby amended to read as follows: “SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through September 15, 2020 unless terminated earlier pursuant to Section 19 of this Agreement.” DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 2 of 13 SECTION 3. Section 4. “NOT TO EXCEED COMPENSATION” of the Contract is hereby amended to read as follows: “SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A”, including both payment for professional services and reimbursable expenses, shall not exceed, Year One, Not to Exceed: $79,691.00 Year Two, Not To Exceed: $99,454.00 Year Three, Not to Exceed: $202,851.00 Year Four, Not to Exceed: $223,977.00 Year Five, (Six Month Extension) Not to Exceed: $156,820.00 Year Six, (1 year Extension) Not to Exceed: $151,878.27 Total Compensation for all five years and six months shall not exceed Nine Hundred Fourteen Thousand Six Hundred Seventy One Dollars and Twenty Seven Cents ($914,671.27). The applicable rates and schedule of payment are set out in Exhibit “C-1”, entitled “RATE SCHEDULE,” which is attached to and made a part of this Agreement. If any regulatory changes, or changes in applicable laws, have a material impact on CONSULTANT’s expenses in performing its obligations under this Agreement, CONSULTANT and CITY agree that the parties will negotiate in good faith equitable adjustments in compensation. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. 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 in Exhibit “A”.” SECTION 4. The following exhibit(s) to the Contract is/are hereby amended or added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which is/are hereby incorporated in full into this Amendment and into the Contract by this reference: a. Exhibit “C” entitled “COMPENSATION”, AMENDED, REPLACES PREVIOUS. DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 3 of 13 b. Exhibit “C-1” entitled “RATE SCHEDULE”, AMENDED, REPLACES PREVIOUS. SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect. SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference. (SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.) DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 4 of 13 SIGNATURES OF THE PARTIES IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Amendment effective as of the date first above written. CITY OF PALO ALTO City Manager APPROVED AS TO FORM: City Attorney or designee SP PLUS CORPORATION By: Name: Title: Attachments: EXHIBIT “C” COMPENSATION EXHIBIT “C-1” RATE SCHEDULE DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Senior Vice President Jason Johnston Vers.: Aug. 5, 2019 Page 5 of 13 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 rate schedule attached as Exhibit C-1 up to the not to exceed budget amount for each task set forth below. The compensation to be paid to CONSULTANT under this Agreement for all services described in Exhibit “A” (“Basic Services”) and reimbursable expenses shall not exceed $914,671.27. CONSULTANT agrees to complete all Basic Services, including reimbursable expenses, within this amount. 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. 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, does not exceed $914,671.27. DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 6 of 13 Task 9 (In-Person Support for Phase 1) $25,000.00 Task 10 (In-Person Support for Phase 2) $15,000.00 Task 11 (Permit costs for Phase 2, based on an $54,000.00 estimate of 11,900 permits at a cost of $4.53 per permit) AMENDMENT NO. 2 Additional Compensation for year 3 $144,413.00 Year Four $223,977.00 AMENDMENT NO. 3 BUDGET SCHEDULE Task 1 NOT TO EXCEED AMOUNT $43,804.00 (T2 Flex, T2 eBusiness, and T2 Travel) Task 2 (Website Design) $6,150.00 Task 3 (Website Development) $12,080.00 Task 4 (Website Hosting & Maintenance) $24,665.00 Task 5 (Project Management) $55,636.00 Task 6 (T2 Flex & eBusiness Annual Subscription Fees) $45,253.00 Task 7 (T2 Flex & eBusiness Permit Fulfillment/ Customer support) $95,130.00 Task 8 (Permit Configuration Fee) AMENDMENT NO. 1 $1,350.00 DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 7 of 13 Southgate Residential Preferential Parking (RPP) program $16,355.00 Sub-total Basic Services $762,793.00 Maximum Total Compensation $762,793.00 AMENDMENT NO. 4 BUDGET SCHEDULE NOT TO EXCEED AMOUNT Task 1 Year One $79,691.00 Task 2 Year Two $99,454.00 Task 3 Year Three $202,851.00 Task 4 Year 4 $223,977.00 Task 5 Year 5 (Six Month Extension) $156,820.00 AMENDMENT NO. 5 BUDGET SCHEDULE NOT TO EXCEED AMOUNT Task 1 Year One $79,691.00 Task 2 Year Two $99,454.00 Task 3 Year Three $202,851.00 Task 4 Year 4 $223,977.00 Task 5 Year 5 (Six Month Extension) $156,820.00 Task 6 Year 6 (One Year Extension) $151,878.27 Sub-total Basic Services $914,671.27 Maximum Total Compensation $914,671.27 DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 8 of 13 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. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: NONE All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The 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: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 9 of 13 EXHIBIT “C-1” RATE SCHEDULE Fixed Start Up Costs (based on specified scope/development hours): Task 1 T2 Flex, T2 eBusiness, and T2 Travel $43,804 Task 2 SP+ Website Design $6,150 Task 3 SP+ Website Development $12,080 Total Fixed Start Up Costs $62,034 Recurring Annual Costs: Year 1 Year 2 Year 3 Task 4 SP+ Website Hosting and Maintenance $7,980 $8,219 $8,466 Task 5 SP+ Project Management $18,000 $18,540 $19,096 T2 Recurring T2 Flex & eBusiness Annual Subscription Fees $14,355 $15,072 $15,826 Optional Costs: T2 Recurring T2 Flex & eBusiness Permit Fulfillment/Customer Support Fees $31,710 $31,710 $31,710 Estimated cost to provide permits and permit support based on and estimate of 7,000 permits at a cost of $4.53 per permit ($0.99 WW&L Permits, and, $3.54 Permits Direct Fulfillment)*. T2 Fixed Permit Configuration (one time only fee) $1,350 Year 1 Year 2 Year 3 TOTAL PER YEAR $135,429 $73,541 $75,098 TOTAL NOT TO EXCEED: $284,068.00 * If more than 7,000 permits are sold, the City agrees to pay an additional $4.53 per permit over and above the not to exceed compensation amounts reflected in the agreement by issuance of an amendment to the agreement. AMENDMENT NO. 1 CITY will pay CONTRACTOR an hourly rate of $41.16 per person per hour for on-site customer service support. $25,000 (In-Person Support for Phase 1) $15,000 (In-Person Support for Phase 2) $54,000 (Permit costs for Phase 2, based on an estimate of 11,900 permits at a cost of $4.53 per permit) AMENDMENT NO. 1 TOTAL $94,000.00 TOTAL PER YEAR Year 1 Year 2 Year 3 $160,429 $142,541 $75,098 TOTAL NOT TO EXCEED: $378,068.00 DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 10 of 13 AMENDMENT No. 2 AMENDMENT NO. 2 TOTAL $368,390.00 Year 1 Year 2 Year 3 Year 4 TOTAL PER YEAR $160,429 $142,541 $227,495 $223,977 TOTAL CONTRACT NOT TO EXCEED: $746,458.00 Recurring Annual Cost: 3/16/17 through 3/8/18 3/9/2018 through 3/9/2019 Task 4 SP+ Website Hosting and Maintenance $10,159 $10,464 Task 5 SP+ Project Management $22,915 $23,603 T2 Recurring T2 Flex & eBusiness Annual Subscription Fees $15,826 $16,617 Total Recurring Annual Costs $48,900 $50,684 Permit Administrator Based on monthly billing of $7,460 with annual 3% increase $89,520 $92,206 Permit Fulfillment T2 Recurring, T2 Flex, & eBusiness Permit Fulfillment/Customer Support fees based on an estimate of 11,900 permits at $4.53 per permit ( $0.99 WW&L, $3.54 direct fulfillment)* $53,907 $53,907 Additional Evergreen Park-Mayfield Permit Fulfillment costs 6,000 permits at $4.53* $ 27,180 $ 27,180 Total Per Year $219,507 $223,977 Total for Years 3 & 4 $443,484.00 Total for Years 1 & 2 $302,974.00 Contract Total Not to Exceed $746,458.00 *If more that 17,900 total permits are sold, the City agrees to pay an additional $4.53 per permit over and above the not to exceed compensation DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 11 of 13 AMENDMENT No. 3 Year 3 Year 4 3/16/17 3/9/2018 through through 3/8/2018 3/9/2019 Recurring Annual Cost: Task 4 SP+ Website Hosting and Maintenance $ 624.31 $ 643.04 Task 5 SP+ Project Management $ 1,408.20 $ 1,450.45 T2 Recurring T2 Flex & eBusiness Annual Subscription Fees $ 972.55 $ 1,021.18 Total Recurring Annual Costs $ 3,005.06 $ 3,114.66 Permit Administrator Based on monthly billing of $7,460 with annual 3% increase $ - $ - Permit Fulfillment T2 Recurring, T2 Flex, & eBusiness Permit Fulfillment/Customer Support fees based on an estimate of 1100 permits at $4.53 per permit ($0.99 WW&L, $3.54 direct fulfillment)* $ 4,983.00 $ 5,232.15 Total Per Year $ 7,988.06 $ 8,346.81 *If more that 1100 permits are sold, the City agrees to pay an additional $4.53 per permit over and above the exceed compensation amounts reflected in the agreement by issuance of an amendment to the agreement AMENDMENT NO. 3 TOTAL $16,335.00 Year 1 Year 2 Year 3 Year 4 TOTAL PER YEAR $160,429 $142,545 $227,495 $232,324 TOTAL CONTRACT NOT TO EXCEED: $762,793.00 DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 12 of 13 AMENDMENT No. 4 Year 5 3/15/19 through 9/15/2019 Recurring Monthly Cost: Task 4 SP+ Website Hosting and Maintenance $ 643.04 Task 5 SP+ Project Management $ 1,450.45 T2 Recurring T2 Flex & eBusiness Annual Subscription Fees $ 1,021.18 Total Recurring Monthly Costs $ 3,114.67 Permit Administrator Based on monthly billing of $7,460 with annual 3% increase $ - Permit Fulfillment T2 Recurring, T2 Flex, & eBusiness Permit Fulfillment/Customer Support fees based on an estimate of 1100 permits at $4.53 per permit ($0.99 WW&L, $3.54 direct fulfillment)* $ 5,232.15 Total Monthly Costs $ 8,346.82 (No Monies added, using monies not utilized in the previous years for year 5 extension.) Year 1 Year 2 Year 3 Year 4 Year 5 (6 Mo. Ext.) TOTAL PER YEAR $79,691. $99,454. $202,851. $223,977. $156,820. Total Compensation $762,793.00 DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 Vers.: Aug. 5, 2019 Page 13 of 13 AMENDMENT No. 5 Year 6 9/16/19 through 9/15/2020 Recurring Monthly Cost: 925.59$ 2,087.79$ 500.00$ 3,513.38$ 42,160.56$ Permit Administrator Based on monthly billing of $7,460 with annual 3% increase $ - T2 Annual License Fee T2 Core Flex, FlexPort Accounts, FlexPort Permits 14,749.71$ Permit Fulfillment 7,914.00$ Total Annual Charge 94,968.00$ Total Annual Cost 151,878.27$ T2 Recurring Monthly Charge -T2 Flex & ePermits Fulfillment/Customer Support fees based on an estimate of 1100 permits at $5.00 per permit* Downtown, Evergreen, Southgate, Old Palo Alto Task 4 SP+ Website Hosting and Maintenance Task 5 SP+ Project Management New Location (Old Palo Alto) Total Recurring Monthly Costs Total Annual Charge Year 1 Year 2 Year 3 Year 4 Year 5 (6 Mo. Ext.) Year 6 (1 Yr. Ext.) TOTAL PER YEAR $79,691. $99,454. $202,851. $223,977. $156,820. $151,878.27 Total Compensation $914,671.27 DocuSign Envelope ID: 966D8180-AF79-44DF-8FF5-B7E95D512693 DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 1 of 18 AMENDMENT NO. 5 TO CONTRACT NO. C15156763 BETWEEN THE CITY OF PALO ALTO AND SERCO INC. This Amendment No. 5 (this “Amendment”) to Contract No. C15156763 (the “Contract” as defined below) is entered into as of October 21, 2019 by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and SERCO INC., a New Jersey corporation, located at 1818 Library Street, Suite 1000, Reston, Virginia 20190 (“CONSULTANT”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment. R E C I T A L S A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of parking enforcement services for the Downtown Residential Preferential Parking (RPP) district, as detailed therein. B. The Parties now wish to amend the Contract in order to extend the term and to increase compensation by $35,070.40 from $2,435,994.00 to $2,471,064.40 for additional services per Exhibit “A” Scope of Services. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree: SECTION 1. Definitions. The following definitions shall apply to this Amendment: a. Contract. The term “Contract” shall mean Contract No. C15156763 between CONSULTANT and CITY, dated 6/1/2015, as amended by: Amendment No.1, dated 1/25/2016 Amendment No.2, dated 2/27/2017 Amendment No.3, dated 8/21/2017 Amendment No.4, dated 1/14/2018 b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract. SECTION 2. Section 2. TERM of the Contract is hereby amended to read as follows: “SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through March 31, 2020 unless terminated earlier pursuant to Section 19 of this Agreement.” DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 2 of 18 SECTION 3. Section 4. COMPENSATION of the Contract is hereby amended to read as follows: “SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit “A”, including both payment for professional services and reimbursable expenses, shall not exceed per year per the following: Year One $503,210.00 Year Two $563,210.00 Year Three $675,707.00 Year Four $693,867.00 Year Five $35,070.40 Total contract compensation shall not exceed Two Million Four Hundred Seven-One Thousand Sixty-Four Dollars and Forty cents ($2,471,064.40). The applicable rates and schedule of payment are set out in Exhibit “C-1”, entitled “HOURLY RATE SCHEDULE,” which is attached to and made a part of this Agreement. Additional Services, if any, shall be authorized in accordance with and subject to the provisions of Exhibit “C”. 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 in Exhibit “A”.” SECTION 4. The following exhibit(s) to the Contract is/are hereby amended or added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which is/are hereby incorporated in full into this Amendment and into the Contract by this reference: a. Exhibit “A” entitled “SCOPE OF SERVICES”, AMENDED, REPLACES PREVIOUS. b. Exhibit “C” entitled “COMPENSATION”, AMENDED, REPLACES PREVIOUS. SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect. SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference. SIGNATURES OF THE PARTIES IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 3 of 18 this Amendment effective as of the date first above written. CITY OF PALO ALTO SERCO Inc. City Manager APPROVED AS TO FORM: Officer 1 By: Name: Title: Chan Phuong Contracts Representative Officer 2 (Required for Corp. or LLC) City Attorney or designee By: Name: Title: David Cornell Sr Manager Contracts Attachments: EXHIBIT “A”: SCORE OF SERVICES, AMENDMENT No. 5 (AMENDED, REPLACES PREVIOUS) EXHIBIT “C”: COMPENSATION, AMENDMENT No. 5 (AMENDED, REPLACES PREVIOUS) DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 4 of 18 EXHIBIT “A” SCOPE OF SERVICES CONSULTANT will provide enforcement services for the Downtown Residential Preferential Parking (RPP) district, issuing parking citations to violators for a period of up to 3 years. Information on the design of the Downtown RPP district is found in Attachment A. TASK 1: ONBOARDING AND STARTUP – 60 DAYS CONSULTANT will provide the appropriate and necessary training to employees who work for the CITY, relevant to their respective job duties. CONSULTANT shall maintain complete training records for each employee, as well as any other records prescribed by law or CITY policy as appropriate. The CITY’s Police Department will provide all materials related to enforcement rules and regulations currently in place; all other training materials are to be provided by CONSULTANT. Training topics include, but are not limited to, to the following topics: a. Design of the Downtown RPP District, including information on employee and resident permits and history of the program development b. Enforcing parking permit violations and other parking regulations c. Marking and tagging of vehicles using Consultant-provided handheld devices d. Palo Alto Municipal Codes, California Vehicle Code, state statutes, and ordinances related to parking enforcement e. Chain of command and authority levels f. Marking, tagging, towing, and impoundment of vehicles g. Job procedures and emergency protocol h. Responding to calls for service i. Customer service delivery and expectations j. Courtroom procedures and testimony k. Workplace safety l. Civil rights law and procedures m. Information on history of Palo Alto, City Downtown, and City Attractions The training program should provide the CONSULTANT’s personnel with sufficient understanding of the RPP District as well as operation of required equipment and enforcement protocol. All personnel are to complete and pass the training course prior to starting service, and the training procedures must be approved by the CITY. The time period from CITY’s notice to proceed to start of enforcement shall not be less than sixty (60) days. CONSULTANT will also train staff to appear in court in a professional manner with related documentation and evidence to support the case. CONSULTANT’s Project Manager will represent the company on most court appearances unless an enforcement officer is specifically required to be present, in which case the Project Manager will accompany the enforcement officer or Supervisor to the hearing. DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 5 of 18 Deliverable: CONSULTANT will provide a training plan upon receiving notice to proceed from the CITY. The training plan will include all training activities planned for enforcement officers and include information from the CITY required to complete the training, as well as a detailed schedule. PERSONNEL CONSULTANT will ensure that all new employees meet all CITY of Palo Alto and CONSULTANT employment requirements as listed below. CONSULTANT will comply with all existing Government code and CITY non-discrimination policies. All candidates must complete a job application and provide a DMV printout. To be offered a position, candidates must pass a pre-screening at CONSULTANT’s expense. The pre-screening includes the following: a. Pre-employment drug and alcohol testing b. Criminal history background check c. DMV record check d. Social Security Number verification e. Eligibility to work in the United States f. Ability to speak and write in English g. LiveScan/Fingerprinting h. California Department of Justice background check Drivers will undergo further screening: a. Comply with USDOT/Federal Motor Carrier Safety Administration and California DMV regulations b. DMV nationwide records check c. Pass the Smith Systems Defensive Driver Safety Training d. 40 hours on-the-job training CONSULTANT shall select and hire only persons who are well-qualified to perform the duties for their respective job positions, and should provide classifications of all employee positions within their proposal, including a job description. Classifications might include, but are not limited to: • Parking Enforcement Supervisor/Manager: Assist the parking enforcement staff with day-today operations and staffing issues. Supervisor shall be responsible to report with the on a bimonthly basis and provide updates on the enforcement process, any feedback from the public, incidents and number of citations issued. A supervisor should possess sufficient IT knowledge to be able to handle employee equipment issues in the field, and the capability of working with the citation processing agency for any citation issues. • Parking Enforcement Staff: Responsible for the day-to-day management, supervision, and operation of parking enforcement services. These individuals must have the capacity to act as “Ambassadors” for the CITY, providing information about parking enforcement practices and other information on Palo Alto’s Downtown. DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 6 of 18 CONSULTANT should provide performance metrics for each position so that performance evaluations may take place. CONSULTANT will provide eleven (11) shirts and eleven (11) pants to full-time employees. CONSULTANT will issue staff jackets, hats, and rain attire for inclement weather, all bearing the company logo. CONSULTANT and uniform company will be responsible for cleaning of uniforms. Cleaning of uniforms is not the responsibility of the CITY. CONSULTANT will provide sample uniforms for CITY review prior to any issuance of uniforms. Employees will wear CONSULTANT-issued photo ID at all times while on duty. CONSULTANT will be expected to purchase parking permits for any employees driving to Palo Alto. CONSULTANT will be responsible for all personnel supervision, discipline, and termination actions. However, the CITY may require the removal of any CONSULTANT’s personnel, when it is determined to be in the best interest of the CITY, at any time. CONSULTANT will address temporary vacancies due to vacations, illness, leaves of absence, or termination and provide continuous staffing. Deliverables: a. CONSULTANT will supply an updated organization chart and complete list of employees and roles at the CITY’s request and annually on contract anniversary date. b. CONSULTANT will provide draft design of enforcement uniforms for approval during transition phase. c. At the request of the CITY, Consultant will allow CITY to participate in employee interviews. TASK 2: Enforcement of Phase 1 and Phase 2 of RPP Program (18 Months) CONSULTANT will be responsible for issuing citations for parking permit violations within the Downtown RPP District, in accordance with the rules specified in Attachment A. Citations must include the make, model, color, and style of vehicle, license tag number or Vehicle Identification Number (VIN), violation code number and description, base fine amount and additional fine amount in the event there is a failure to respond timely, badge number, the location of the parking offense, type of offense (e.g. permit incorrectly displayed, no valid permit, not parked in the right location) and the time and date of the offense. CONSULTANT staff will be fully trained on Consultant-furbished handheld devices. Staff will also be trained on how to capture digital images of vehicle license plates, and how to issue manual paper citations. Consultant will work with CITY’s existing citation processing vendor to ensure that citations associated with the RPP district may be recorded and tracked separately from existing parking enforcement. DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 7 of 18 CONSULTANT will be trained on proper placement of citations on the windshield, how to complete and issue citations for drive offs and covered VIN numbers, missing license plates, and other unusual occurrences. In the event the driver drives away, the citation will be mailed as required by the California Vehicle Code. CONSULTANT will furnish two (2) hybrid vehicles for parking enforcement services and will be responsible for all on-going operating expenses including insurance, fuel, maintenance, and repairs. The vehicles will be equipped with GPS tracking units and LPR technology as necessary. CONSULTANT’s vehicles shall be clearly identifiable as performing parking enforcement and parking meter maintenance and collection operations for the CITY. CONSULTANT’s staff shall operate all vehicles at all times in compliance with all state and local motor vehicle and emissions laws. Vehicles shall not have missing parts or dents, and the rear of all patrol vehicles shall have a sign warning of frequent vehicle stops. All vehicles used by CONSULTANT shall have blinking flasher lights installed on each vehicle's roof. CONSULTANT will obtain approval by the CITY Manager and the Chief Communications Officers or his/her designee prior to ordering decals for the marking of vehicles. CONSULTANT will also provide officers with four (4) Trek Marlin 6 bicycles, anticipating that some enforcement officers may be able to use this method of enforcement for either Phase 1 or Phase 2. Deliverable: CONSULTANT will provide draft design for vehicle marking. Consultant will provide an enforcement strategy document for Phase 1 and Phase 2 of the program, including anticipating beats, schedule, and personnel assigned to each phase of the project. Consultant will work with CITY to identify opportunities for improving and modifying enforcement strategy at periodic intervals during Phase 2 of the program, especially opportunities which could be afforded by the introduction of technology (e.g. LPR). The Consultant will use mark-moding and chalking as the main forms of enforcement during Phase 1, but will work with the CITY to identify other modes of enforcement as the program moves forward. CONSULTANT will provide a schedule of estimated patrol routes and frequency recommendations. The CITY seeks to ensure that coverage is adequate, fair, regular, and consistent, although it is also expected that CONSULTANT will alternate the patrol routes on a regular basis to eliminate predictability. CONSULTANT can propose changes to routes and schedules to the CITY as part of their performance reporting meetings and documentation. CONSULTANT will be responsible for maintaining records of employment and, upon request, provide the CITY with personnel and training information for each employee. CONSULTANT will require Parking Enforcement Officers to submit daily reports regarding issues such as: a. Missing or damaged or conflicting parking signs, or traffic control signs, or curb markings b. Obstructed parking signs, stop signs, yield signs or any safety hazard c. Parking abnormalities or abnormal parking patterns DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 8 of 18 d. Beat analysis and beat enforcement e. Incidents/accidents CONSULTANT will update and meet with CITY staff regularly, including the following: a. Weekly status reports with Parking Operations Lead and other staff as necessary b. Monthly progress meetings c. Quarterly evaluation and status report d. Annual performance review CONSULTANT will seek CITY approval on operational changes including but not limited to: a. Schedules b. Routes c. Operations ATTACHMENT A The proposed Downtown Residential Preferential Parking (RPP) Program is being introduced as part of a suite of parking management strategies aimed at improving parking and traffic conditions in Downtown Palo Alto. The program will restrict commuter parking during hours of operation, although limited numbers of commuter-employee permits will also be sold. Over time, the number of employee permits will be reduced as additional parking supply is provided within the Downtown area. The proposed RPP District includes a geographic area surrounding Palo Alto’s Downtown commercial zone and bounded by the City of Menlo Park to the Northwest. Currently, the only existing parking restrictions within this boundary include the Downtown Business District color zone and the SOFA business District: • The SOFA business district has 2-hour parking along streets which house mainly local businesses. Customers may re-park after two hours in any of the spaces. • The Downtown color zone has 2-hour parking which is limited to a specific color zone – Blue, Coral, Lime or Purple. Parking twice within the same color zone during the time period 8:00 to 5:00 is not permitted. The physical boundaries of the new Downtown RPP District will not include the existing SOFA and Downtown areas, which are currently enforced by the Palo Alto Police Department using markmoding and chalking. The area within the dotted blue line will be included in the new parking District (see below). DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 9 of 18 The program as currently proposed has two distinct phases, where parking restrictions will differ: Phase 1: 6 Months For the first phase of the program, the CITY will sell RPP permits to residents and to employees who live or work within the boundaries of the District. Permits will be sold online using an online issuance system by T2 Systems. It is expected that guest permits will be hangtags and that individual permits will be stickers on vehicles. There will be several types of valid permits: • Resident Permit (sold to individuals living at residential addresses within the blue line area). • Standard Commuter Employee Permit: This is a permit that will be sold to employee commuters who work within the RPP District Boundary. • Residential Annual Guest Permits / Visitor Permits DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 10 of 18 All permits shall be valid anywhere within the District during this phase. Although the CITY recognizes that license plate recognition (LPR) equipment could be used for enforcement and physical permits may not be necessary for Phase 1 enforcement, the CITY wishes to use Phase 1 of the program to collect needed parking occupancy data, and therefore will require physical permits during Phase 1. This phase of the program will be used to determine the appropriate “permit cap” for employee permit sales in future phases of the program. The CITY is proposing that Phase 1 of the program last for 6 months only. All permits sold within Phase 1 will expire at the end of 6 month period, which will be identified on the permit. Phase 2: 12+ Months After Phase 1, the CITY will begin to limit the number of employee permits which will be sold for the program. Rather than allowing employees with permits to park anywhere within the District, employee permits will be allocated in one of the following ways: 1. Employee permits may be sold specific to a block face or faces, e.g. the “900-1000 Block of Ramona”, which would be visible on the permit, or; 2. Employees with permits can only park during enforcement hours at specific “employee” spots within the District, which would be allocated along block faces within the residential area. Residential permits, Annual Guest Permits and Visitor permits will be valid anywhere within the District. Anyone without a valid permit will be allowed to park for two (2) hours, at which point they would need to move their car to a different parking space. The hours of enforcement of the program are expected to be Monday through Friday, 8:00am – 5:00pm. AMENDMENT NO. 1 ADDITIONAL SERVICES CONSULTANT will provide one additional Parking Enforcement Officer to support enforcement of newly annexed streets and approved neighborhoods in the Downtown Residential Preferential Parking (RPP) program in accordance with this Contract and as shown in Appendix B. CONSULTANT will begin enforcing street faces in yellow once signage is installed on those streets. CONSULTANT will not begin enforcing areas shown in blue until receiving further direction from the City. Once the City provides direction, CONSULTANT shall enforce newly annexed streets in accordance with the terms of this Contract. CONSULTANT will follow and be subject to all other protocols as listed previously in this exhibit. Appendix B: Annexation of Downtown RPP District DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 11 of 18 AMENDMENT NO. 2 ADDITIONAL SERVICES CONSULTANT will provide one additional Parking Enforcement Officer to support enforcement of newly annexed streets and approved neighborhoods in the Evergreen Park-Mayfield Residential Preferential Parking (RPP) program in accordance with this Contract and as shown in Appendix C. CONSULTANT will begin enforcing street faces in yellow once signage is installed on those streets. CONSULTANT will not begin enforcing areas shown in blue until receiving DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 12 of 18 further direction from the City. Once the City provides direction, CONSULTANT shall enforce newly annexed streets in accordance with the terms of this Contract. CONSULTANT will follow and be subject to all other protocols as listed previously in this exhibit. CITY wishes to extend term of contract for a fourth (4th) year. Appendix C: Evergreen Park-Mayfield RPP District DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 13 of 18 AMENDMENT NO 3 CONSULTANT will provide one additional Parking Enforcement Officer to support enforcement of newly annexed streets and an approved neighborhood in the Southgate Residential Preferential Parking (RPP) program. CONSULTANT will begin enforcing street faces in grey once signage is installed on those streets. DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 14 of 18 DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 15 of 18 AMENDMENT NO. 5 ADDITIONAL SERVICES CONSULTANT will provide one additional Parking Enforcement Officer to support enforcement of newly annexed streets and approved neighborhoods in the Old Palo Alto Residential Preferential Parking (RPP) program. CONSULTANT will begin enforcing street faces in redoncesignageisinstalled on those streets. CONSULTANT will not begin enforcing areas shown in blue until receiving further direction from the City. DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 16 of 18 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. The compensation to be paid to CONSULTANT under this Agreement for all services described in Exhibit “A” (“Basic Services”) and reimbursable expenses shall not exceed: Year One $503,210.00 (6/1/15 through 5/31/16) Year Two $563,210.00 (6/1/16 through 5/31/17) Year Three $675,707.00 (6/1/17 through 5/31/18) Year Four $693,867.00 (6/1/18 through 5/31/19) Year Five $35,070.40 (6/1/19 through 3/31/20) Total contract compensation shall not exceed $2,471,064.40. Consultant agrees to complete all Basic Services, including reimbursable expenses, within this amount. 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. 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, does not exceed $2,471,064.40. BUDGET SCHEDULE NOT TO EXCEED AMOUNT YEARS 1-3 Task 1 (Project Manager per year) $141,446.00 Task 2 (Parking Enforcement Officer per year) $242,304.00 Task 3 (ODC’s & Materials per year) $119,460.00 Sub-total Basic Services per Years 1-3 $503,210.00 Sub-total Basic Services for Three Year Term $1,509,630.00 DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 17 of 18 AMENDMENT NO. 1 ADDITIONAL SERVICES Additional Enforcement Officer. Year 2 $52,500.00 One-time start-up and equipment costs (Year 2) $7,500.00 Subtotal for AMENDMENT No. 1 $60,000.00 AMENDMENT NO. 2 ADDITIONAL SERVICES Additional Compensation for Year 3 (2 Additional Enforcement Officers) $112,498.00 Compensation for Year 4 $638,726.00 Subtotal for AMENDMENT No. 2 $751,224.00 AMENDMENT NO. 3 ADDITIONAL SERVICES Additional Compensation for Year 3 (1 Additional Enforcement Officer Includes $7,500.00 startup Fee) $59,999.00 Compensation for Year 4 $55,141.00 Subtotal for AMENDMENT No. 3 $115,140.00 AMENDMENT NO. 5 ADDITIONAL SERVICES Additional Compensation for Year 5 (New RPP district and 1 FTE on 20 hours/week) $27,570.40 One-time startup cost (portion of ODCs) $ 7,500.00 Subtotal for AMENDMENT No. 5 $35,070.40 Reimbursable Expenses None Total Basic Services and Reimbursable expenses $2,471,064.40 Maximum Total Compensation $2,471,064.40 REIMBURSABLE EXPENSES The administrative, overhead, secretarial time or secretarial overtime, word processing, photocopying, in-house printing, insurance and other ordinary business expenses are included DocuSign Envelope ID: D9AA7AFD-A2C6-4597-BF2E-79AC2C85CE2C Vers.: Aug. 5, 2019 Page 18 of 18 within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT shall be reimbursed are: None All requests for payment of expenses shall be accompanied by appropriate backup information. Any expense shall be approved in advance by the CITY’s project manager. ADDITIONAL SERVICES The 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. Certificate Of Completion Envelope Id: D9AA7AFDA2C64597BF2E79AC2C85CE2C Status: Completed Subject: Please DocuSign: Amend #5 C15156763 Serco - legal reviewed.doc Source Envelope: Document Pages: 18 Signatures: 2 Envelope Originator: Certificate Pages: 2 Initials: 0 Terry Loo AutoNav: Enabled EnvelopeId Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) 250 Hamilton Ave Palo Alto , CA 94301 Terry.Loo@CityofPaloAlto.org IP Address: 12.220.157.20 Record Tracking Status: Original 9/25/2019 11:57:47 AM Holder: Terry Loo Terry.Loo@CityofPaloAlto.org Location: DocuSign Security Appliance Status: Connected Pool: StateLocal Storage Appliance Status: Connected Pool: City of Palo Alto Location: DocuSign Chan Phuong Chan.Phuong@serco-na.com Contracts Representative Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 174.64.52.10 Sent: 9/25/2019 12:01:00 PM Resent: 9/30/2019 7:49:09 AM Viewed: 9/25/2019 12:44:03 PM Signed: 9/30/2019 7:56:43 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign David Cornell David.Cornell@serco-na.com Sr Manager Contracts Security Level: Email, Account Authentication (None) Signature Adoption: Pre-selected Style Using IP Address: 174.64.52.10 Sent: 9/30/2019 7:56:45 AM Viewed: 9/30/2019 11:13:03 AM Signed: 9/30/2019 11:13:30 AM Electronic Record and Signature Disclosure: Not Offered via DocuSign Elizabeth Egli elizabeth.egli@cityofpaloalto.org Managment Analyst City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign Sent: 9/30/2019 11:13:33 AM Carbon Copy Events Status Timestamp Certified Delivery Events Status Timestamp Intermediary Delivery Events Status Timestamp Agent Delivery Events Status Timestamp Editor Delivery Events Status Timestamp In Person Signer Events Signature Timestamp Signer Events Signature Timestamp Mark Hur mark.hur@cityofpaloalto.org Parking Operations Lead Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign Madina Kilcheva madina.kilcheva@cityofpaloalto.org Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign Sent: 9/30/2019 11:13:34 AM Sent: 9/30/2019 11:13:35 AM Witness Events Signature Timestamp Notary Events Signature Timestamp Envelope Summary Events Status Timestamps Envelope Sent Certified Delivered Signing Complete Completed Hashed/Encrypted Security Checked Security Checked Security Checked 9/30/2019 11:13:35 AM 9/30/2019 11:13:35 AM 9/30/2019 11:13:35 AM 9/30/2019 11:13:35 AM Payment Events Status Timestamps Carbon Copy Events Status Timestamp City of Palo Alto (ID # 10731) City Council Staff Report Report Type: Informational Report Meeting Date: 10/21/2019 City of Palo Alto Page 1 Summary Title: Follow-up from federal advocates' 2019 study session Title: Informational Follow-Up From the September 16, 2019 Study Session With the City's Federal Advocate From: City Manager Lead Department: City Manager Executive Summary On September 16, 2019, Council held a study session with Steve Palmer of Van Scoyoc Associates, the City’s federal advocacy contractor. During that session, Council asked questions on certain legislative, public policy, and federal financing items. Below, staff provides responses to those questions, and expands on comments shared: Opportunity Zones in Palo Alto • Created in 2017 by federal law, these zones are tools used to spur economic development and job creation in distressed communities by providing tax benefits to those investing into these communities. • Palo Alto has no Opportunity Zones. As all of California’s zones are established and may not be re-designated, it is unlikely Palo Alto will receive an Opportunity Zone, absent changes to federal law.* • Governors of each state nominate low-income communities for a Qualified Opportunity Zone designation, as determined by census tracts. • There are 879 such zones in California. In Santa Clara County, there are 11 Opportunity Zones, in parts of San Jose and Gilroy, with poverty rates ranging from 9.7% to 34%. • Two of the criteria used to determine California’s Opportunity Zones include: o Adjusted for High Median Incomes. Limited potential Zones to only those census tracts that have a median income below $100,000. o Focused on Overlap with Existing Programs. The selected tracts are heavily consistent with the definition of “disadvantaged communities” for Cap and Trade purposes. * The tax bill that set up opportunity zones does not include any possibility for changes after the Governor-nominated census tracts were confirmed by the U.S. Treasury. Testing of supersonic jets • NASA is currently testing an X-59 supersonic airplane in Hampton, Virginia, with a goal to avoid loud sonic booms. From Tech Crunch in April 2019, (emphasis added): City of Palo Alto Page 2 “…the X-59 will feature a totally new, unique design that emphasizes a much more contoured look versus current commercial aircraft, which is how it aims to achieve its quiet flight and avoid loud sonic booms when it actually goes supersonic. This is a key development target because the whole point of the aircraft is to demonstrate that it’s possible to fly at supersonic speeds without loud booms at ground level, in order to show regulators that it’s possible to fly commercial supersonic aircraft over land and populated areas. The Concorde, which provided supersonic flight commercially from 1976 until 2003, couldn’t operate over land for this reason.” • NASA anticipates initial flights in 2021, and plans to gather input from communities regarding the noise aspect and public acceptance in 2023-2025. • Neither staff nor Van Scoyoc Associates could find any information about NASA testing supersonic aircraft near Palo Alto or in California. Funding in transportation legislation for carbon reductions • America’s Transportation Infrastructure Act is the current highway bill, replacing the earlier FAST Act that expires in 2020. • The bill contains a climate element: about $10 billion for boosting climate resilience in major infrastructure projects, along with reducing GHG emissions. That includes: o establishing a $3 billion carbon emission reduction incentive program, which would go to state projects that help lower vehicle emissions stemming from highways. o A $4.9 billion resilience program is also part of the package, for prepping roads and bridges against extreme weather. o $1 billion would go toward installing EV charging stations along certain highways, along with stations for hydrogen and natural gas. Carbon capture and storage would also benefit from the bill. • Congress will continue to work on this legislation, which must be completed by September 30, 2020. • Of note: While the President has expressed support of the bi-partisan bill, there is no settled agreement on how to pay for it. There is also no information about how localities might receive some of the money – or when, or for what specific projects – assuming the bill is funded, passed, and becomes law. Legislation related to potable water recycling • In February, Congresswoman Napolitano introduced the Water Recycling Investment and Improvement Act of 2019 (HR 1162). Congresswoman Eshoo is a co-sponsor. • The bill would help water agencies expand, design, and build water recycling plants. • HR 1162 has not moved and is not expected to pass the House or the Congress. Broad questions related to City-owned utilities and broadband • Staff could not find any current congressional action related to Publicly Owned Utilities, generally. • Regarding broadband, an amendment was accepted into the House budget bill that would prohibit the FCC from “finalizing a draft declaratory ruling that would overturn local ordinances that promote broadband competition.” • It is unlikely the amendment would pass the Senate, or the President will sign a bill containing such language. City of Palo Alto Page 3 Comments regarding grade separation funding • Congress will not allow legislative earmarks. • However, Congress continues to allocate additional funding into the existing grant programs mentioned at the study session. • Regional support for any federal grant application is critical, particularly for the Trump Administration, which wants to see regions working together. Comments related to San Francisquito Creek • Van Scoyoc Associates has been working with the San Francisquito Creek JPA. • The JPA and Corps of Engineers are looking to take a new funding approach, toward the Section 205 Continuing Authorities Program. Under this program, designed to increase local contributions toward any project, the federal contribution would be $10 million. • Both Congresswomen Eshoo and Speier have expressed support for this approach. Additional comments regarding airplane noise Extremely favorable language was recently included in the Committee Report that accompanies the FY 2020 Senate Transportation, Housing and Urban Development Appropriations bill. A copy is attached. While report language does not have the force of law (because it is not in statute), it is a clear congressional directive to the FAA. The report language covers most of the issues the City of Palo Alto has been working on: improved noise measurements, accounting for the impact of noise on public health, and consideration of public comment when it comes to changes to flight procedures. It also directs the FAA to report back to the Committee detailing efforts made to address concerns with noise such as altering flight paths as a result of testing and community input. This language is some of the best our lobbyists and fellow airplane noise advocates have been able to secure from Congress, through the support of the Quiet Skies Caucus, as it specifically addresses testing procedures and changing flight paths as a result of community input. It also shows that congressional committees overseeing the FAA understand and continue to push the FAA on the need to address aircraft noise. Our representative, Congresswoman Anna Eshoo, is a founding member of the Quiet Skies Caucus. Attachments: • Attachment A - FY 2020 Senate THUD Report - Noise provisions 37–657 PDF Calendar No. 209 116TH CONGRESS REPORT " ! SENATE 1st Session 116–109 TRANSPORTATION, AND HOUSING AND URBAN DEVELOP- MENT, AND RELATED AGENCIES APPROPRIATIONS BILL, 2020 SEPTEMBER 19, 2019.—Ordered to be printed Ms. COLLINS, from the Committee on Appropriations, submitted the following REPORT [To accompany S. 2520] The Committee on Appropriations reports the bill (S. 2520) mak- ing appropriations for the Departments of Transportation, and Housing and Urban Development, and related agencies for the fis- cal year ending September 30, 2020, and for other purposes, re- ports favorably thereon and recommends that the bill do pass. Amounts of new budget (obligational) authority for fiscal year 2020 Total of bill as reported to the Senate .................... $74,293,000,000 Amount of 2019 appropriations ............................... 76,850,542,000 Amount of 2020 budget estimate ............................ 58,468,905,000 Bill as recommended to Senate compared to— 2019 appropriations ..........................................¥2,557,542,000 2020 budget estimate ........................................∂15,824,095,000 29 Terminal Aerodrome Forecasts.—The Committee is aware of con- cerns brought forward by Part 121 supplemental operators regard- ing FAA’s decision in 2016 to require terminal aerodrome forecasts [TAFs], which are not available in most of Alaska. While the FAA occasionally changes its guidance related to flight operations to im- prove the overall safety of our nation’s airspace, the decision to re- quire TAFs appears to have been made without stakeholder en- gagement, was contrary to the extant regulations, and led to unan- ticipated grounding of certain flight operations. As a result, Con- gress included a provision in the FAA Reauthorization Act of 2018 to provide alternate criteria for airports without such forecasts. The Committee reminds the FAA that operation specifications, policies, or guidance documents are not law, and do not trump regulations that have been promulgated through the rulemaking process. The Committee believes that the FAA should ensure that any operation specification, policy, or guidance document that is more restrictive than, or requires procedures that are not expressly stated in regu- lations, are based on a need for safety. Aviation Events.—The Committee directs the FAA to use existing resources to provide air traffic control and safety support services at major aviation events hosted annually for the general aviation community. These services are paid for using the aviation fuel ex- cise tax collected from general aviation users. The Committee di- rects the FAA to use appropriate resources to maintain the safe and efficient movement of aircraft based on projected airspace con- gestion at major aviation events. Contracting.—The Committee is concerned that while the FAA surpasses government averages for key performance acquisition metrics, the FAA has made limited progress in reducing the num- ber of no-bid or sole source contracts awarded. Consistent with rec- ommendations from the OIG report ZA–2016–065, the Committee directs the FAA to establish and implement actions to reduce the use of sole-source contracting, including the use of performance measures. Further, the Committee directs the FAA to provide a re- port to the House and Senate Committees on Appropriations out- lining these performance measures and providing the number and percentage of contracts awarded through the no-bid process, as well as the amount of those no-bid contracts that meet OMB require- ments for such contracts. Noise and Community Outreach.—The Committee directs the FAA to improve the development of flight procedures in ways that will give fair consideration to public comment and reduce noise through procedure modification and dispersion to reduce the impact on local communities. The FAA should utilize state-of-the-art tech- nologies, metrics, and methodologies to measure actual noise at ground level experienced in communities affected by flight paths and not rely solely on computer modeling or other theoretical meas- ures. The FAA should give high priority to evaluating where in- creased noise levels disrupts homes and businesses, and threatens public health, and should provide appropriate resources to regional offices to work with local communities to meet this objective. The Committee directs the FAA to provide a report to the House and Senate Committees on Appropriations within 90 days of enactment of this act that details the efforts made by the FAA during the last 30 two fiscal years to comply with Committee’s directives on this topic. The report must include detailed information on specific locations that have been reevaluated using the requested methodologies, the number of flight paths that have been altered as a result of that testing and community input, the number of properties that have been purchased, and any other mitigation efforts undertaken by the FAA. Pilot Medical Certifications.—The Committee supports the FAA’s Aeromedical Office’s work to ensure commercial pilots with medical conditions can fly safely. Under FAA regulations, insulin-depend- ence is a disqualifying condition, but the FAA issues special third- class medical certificates to private pilots who are insulin-depend- ent. The FAA guidance for Aviation Medical Examiners requires first and second class applicants to be evaluated on a case-by-case basis by the Federal Air Surgeon’s Office, but the FAA has never granted any special issuance medical certificates for first or second class pilots. The Committee directs the FAA to report on the num- ber of airline pilots that held 1st class medical certification that ap- plied for a special issuance medical certificate for insulin depend- ency, the number who have received these special issuance certifi- cates, the number who have been denied these special issuance cer- tificates, and the methodology used to determine which special issuance applications have been approved and denied. Veteran’s pilot training grant program.—The Committee recog- nizes the importance of an adequate future supply of qualified pi- lots, particularly for rural access to air service. The Committee en- courages the FAA to use up to $1,000,000 for competitive grants to part 141 pilot schools that have established employment pathways with part 121 or part 135 commercial air carriers to provide flight training services to veterans. Grants should be used to recruit and enroll veterans for flight training services, provide flight training services to veterans enrolled, and to provide applicable program tuition, training materials, and equipment in coordination with vet- erans’ education benefits. The FAA is directed to submit a report to the House and Senate Committees on Appropriations on imple- mentation of this program, how the FAA will use these funds, and any potential challenges, within 60 days of enactment of this act. Cybersecurity Training.—As the aviation industry continues to makes technological advances in aviation, the Committee recog- nizes that cyber-attacks will require innovations in artificial and human intelligence to respond to these cyber threats and attacks. The Committee encourages the FAA to work with higher education institutions on ways to prevent, detect and respond to cyber threats and cyber-attacks on our air traffic navigation and control systems. Commercial Space.—The FAA recently released a Notice of Pro- posed Rulemaking [NPRM] to reform the current prescriptive launch and reentry regulations. Prior to drafting the rulemaking, the FAA convened an Aviation Rulemaking Committee [ARC] con- sisting of both traditional and emerging commercial space compa- nies. However, the draft rule does not include relevant language approved by a majority of ARC members, and as a result, the pro- posed rule fails to implement a streamlined and performance based approach to regulating an industry whose continued growth and in- novation is critical to national security and civilian space explo-