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HomeMy WebLinkAbout2018-12-03 City Council Agenda PacketCITY or PALO ALTO City Council Monday, December 3, 2018 Special Meeting REVISED Council Chambers 5:00 PM COUNCIL MEMBER TANAKA PARTI CI PATI NG FROM THE PRINCE PARK TOWER TOKYO, MAIN LOBBY 4-8-1 SHIBAKOEN MI NATO,TOKYO 105-8563 JAPAN 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. PUBLI C 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. TI ME ESTI MATES 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. HEARI NGS REQUI RED 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 5:00-5:30 PM Public Comments: Members of the public may speak to the Closed Session item(s); three minutes per speaker. 1. CONFERENCE WITH CITY ATTORNEY Subject: Written Liability Claim Against the City of Palo Alto By Keith Bunnell (Claim No. C18-0049) Authority: Government Code Section 54956.9 (e)(3) Special Orders of the Day 5:30-5:45 PM MEMO#1 2. Appointment of Three Candidates to the Architectural Review Board and Three Candidates to the Parks and Recreation Commission for Three-year Terms Ending December 15, 2021; and two Candidates to the Planning and Transportation Commission for Four-year Terms Ending December 15, 2022 MEMO #2 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. Agenda Changes, Additions and Deletions City Manager Comments 5:45-5:55 PM Oral Communications 5:55-6:10 PM Members of the public may speak to any item NOT on the agenda. Council reserves the right to limit the duration of Oral Communications period to 30 minutes. Consent Calendar 6:10-6:15 PM Items will be voted on in one motion unless removed from the calendar by three Council Members. 3. Approval of an Agreement With the Peninsula Corridor Joint Powers Board in the Amount of $97,755 for the 2019 Caltrain Go Pass Program 4. Finance Committee Recommendation That the City Council: 1) Adopt a Resolution Approving the 2018 Electric Integrated Resource Plan (EIRP), Updated Renewable Portfolio Standard Procurement Plan and Enforcement Program; and 2) Approve two EIRP Planning Documents 5. Approval and Authorization for the City Manager to Execute a Construction Contract With MP Nexlevel of California, Inc. in the Amount of $6,145,494 for Trenching and Substructure Installation and Materials, and a 10 Percent Contingency of $614,549 for Related but Unforeseen Work, for a Total Authorized Amount of $6,760,043 Over Three Years 6. Adoption of an Ordinance Amending Palo Alto Municipal Code (PAMC) Title 16, Chapters 16.58 (Development Impact Fees); 16.59 (Citywide Transportation Impact Fees); and 16.60 (Charleston Arastradero Corridor Pedestrian and Bicyclist Safety Impact Fee) to add Development Impact Fee Exemptions for Junior Accessory Dwelling Units and Certain Accessory Dwelling Units Established by Garage Conversion 7. Adoption of a Resolution of Support for Formation of a Regional Housing Needs Allocation Subregion for Santa Clara County 8. Approval of Amendment Number 1 to Contract Number C18168129 With Kennedy / Jenks Consultants for Professional Design Services for the Primary Sedimentation Tanks Rehabilitation and Equipment Room Electrical Upgrade Project at the Regional Water Quality Control Plant to add Services, Increase Compensation by $249,631 for a new Maximum Compensation Not -to -Exceed $965,000, and to Extend the Contract Term Through March 31, 2022 - Capital Improvement Program Project WQ-14003 2 December 3, 2018 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. 1 1. PUBLIC HEARING / QUASI-JUDICIAL: 429 University Avenue [18PLN-00240]: Appeal of the Planning and Community Environment Director's Denial of a Minor Architectural Review Consistent With Condition of Approval Number 3 From Record of Land Use Action Number 2017-02, for a Previously Approved Mixed -use Building (14PLN-00222), for the Proposed Exterior Building Materials, Colors, and Craftsmanship. Environmental Assessment: Use of Mitigated Negative Declaration Prepared for 14PLN-00222. Zoning District: CD-C(G)(P) (Downtown Commercial With Ground Floor and Pedestrian Shopping Overlay) Action Items Include.. Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. MEMO 9. PUBLIC HEARING. Adoption of an Ordinance Amending Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Repeal Section 18.18.040 Regarding a Nonresidential Square Footage Cap in the CD Downtown Commercial Zoning District to Implement and Conform to the Updated Comprehensive Plan; Section 18.18.040 Implemented Policy L-8 of the Prior 1998 Comprehensive Plan, Which was Removed as Part of the Adoption of the Comprehensive Plan Update. California Environmental Quality Act (CEQA), This Ordinance is Within the Scope of the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720 (Staff Requests This Item be Continued to a Date Uncertain in 2019) MEMO 10. PUBLIC HEARING: Adoption of an Ordinance Amending Section 18.18.120 (Grandfathered Uses and Facilities) of Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Adjust Regulations Relating to Noncomplying Facilities. California Environmental Quality Act (CEQA); This Ordinance is Within the Scope of the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720; Alternatively, the Ordinance is Exempt From Environmental Review Under CEQA Guidelines Section 15061(b)(3) (Staff Requests This Item be Continued to December 10, 201 8) 6:15-10:00 PM 12. PUBLIC HEARING: Adoption of an Ordinance Amending Various Sections of Title 18 of the Palo Alto Municipal Code Related to Residential and Mixed -use Development Standards Including, but not 3 December 3, 2018 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. Limited to, Minimum and Maximum Unit Density, Unit Size, Floor Area Ratio, Height, and Open Space Including Rooftop Gardens; Parking Requirements Including, but not Limited to, Regulations Related to In - lieu Parking for Downtown Commercial Uses and Retail Parking for Mixed Use Projects; Exclusively Residential Projects in Certain Commercial Zoning Districts; Ground -floor Retail and Retail Preservation Provisions; the Entitlement Approval Process; and Other Regulations Governing Residential, Multi -family Residential and Commercial Zoning Districts, all to Promote Housing Development Opportunities in These Zoning Districts in Furtherance of Implementation of the Comprehensive Plan. CEQA: Determination of Consistency with the Comprehensive Plan Environmental Impact Report (El R) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720. The Planning and Transportation Commission Recommended Approval of the Proposed Ordinance on October 10, 2018 (Continued From November 26, 2018) State/Federal Legislation Update/Action Council Member Questions, Comments and Announcements Members of the public may not speak to the item(s) Adjournment AMER! CANS 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 December 3, 2018 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 Standing Committee Meetings Sp. Finance Committee Meeting Sp. City Council Meeting- Closed Session Schedule of Meetings Schedule of Meetings Tentative Agenda Tentative Agenda Public Letters to Council Set 1 December 4, 2018 December 4, 2018 5 December 3, 2018 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. CITY OF PALO ALTO CITY OF PALO ALTO OFFICE OF THE CITY CLERK December 3, 2018 The Honorable City Council Palo Alto, California Appointment of Three Candidates to the Architectural Review Board and Three Candidates to the Parks and Recreation Commission for Three-year Terms Ending December 15, 2021; and two Candidates to the Planning and Transportation Commission for Four-year Terms Ending December 15, 2022 On Monday, December 3, 2018, the Council is scheduled to appoint three (3) candidates to the Architectural Review Board (ARB) and three (3) candidates to the Parks & Recreation Commission (PRC) for three-year terms ending December 15, 2021; and two (2) candidates to the Planning and Transportation Commission (PTC) for four- year terms ending December 15, 2022. Voting will be by paper ballot. Background On November 27, 2018, the Council interviewed applicants for the ARB, PRC, and PTC. Applications can be viewed in the following Staff Report. A recording of the interviews can be viewed online, within 48 hours of the interviews, on the City Council Agenda and Minutes Webpage. Architectural Review Board Vote to appoint three (3) three-year terms on the ARB for terms ending December 15, 2021. The first three candidates to receive at least five votes (required) will be appointed. The 6 ARB Candidates are as follows: A. Peter Baltay (Incumbent) B. Amparo Del Rio C. Robert Gooyer (Incumbent) D. David Hirsch E. Alexander Lew (Incumbent) F. Curtis Smolar Parks and Recreation Commission Vote to appoint three (3) three-year terms on the PRC for terms ending December 15, 2021. The first three candidates to receive at least five votes (required) will be appointed. The 4 PRC Candidates are as follows: G. Anne Cribs (Incumbent) H. Jeff Greenfield (Incumbent) I. David Moss (Incumbent) J. Caleb Weinstein Planning and Transportation Commission Vote to appoint two (2) hour -year terms on the PTC for terms ending December 15, 2022. The first two candidates to receive at least five votes (required) will be appointed. The 13 PTC Candidates are as follows: K. Kelsey Banes L. L. David Baron M. Bern Beecham N. Rebecca Eisenberg 0. Claude Ezran P. Brian Hamachek Q. Michelle Kraus R. Dena Mossar S. Giselle Roohparvar T. Thomas Siegel U. Carolyn "Carl" Templeton V. Elaine Uang W. Craig Yanagisawa Department Head: Beth Minor, City Clerk Page 2 Page 3 CITY OF PALO ALTO 2 TO: HONORABLE CITY COUNCIL FROM: BETH MINOR, CITY CLERK DATE: DECEMBER 3, 2018 SUBJECT: AGENDA ITEM NUMBER 2- Appointment of Three Candidates to the Architectural Review Board and Three Candidates to the Parks and Recreation Commission for Three-year Terms Ending December 15, 2021; and two Candidates to the Planning and Transportation Commission for Four-year Terms Ending December 15, 2022 Council Member DuBois requested an update regarding Board and Commission term end dates following recent City Council actions. September 20, 2017: Policy and Services Committee —Action Staff Report 1 Action Minutes 1 Transcript 1 Video Policy and Services Committee discussion of Board and Commission terms and related matters. Title: Discussion of Re -aligning Terms on the Architectural Review Board, the Historic Resources Board, the Parks & Recreation Commission, and the Planning & Transportation Commission and Other Board and Commission Changes. MOTION AS AMENDED RESTATED: Council Member DuBois moved, seconded by Vice Mayor Kniss to recommend the City Council adopt an Ordinance to: A. Keep two recruitment periods, with the Library Advisory Commission, the Human Relations Commission, the Public Art Commission, and the Historic Resources Board being held in September/October; and the Architectural Review Board, the Parks & Recreation Commission, the Planning & Transportation Commission, and Utilities Advisory Commission being held in January/February; and B. Remove the requirement that the election of the Planning & Transportation Commission chairperson and vice chairperson occur in November; and C. Add, "gender identity" to the Human Relations Commission's jurisdiction; and D. Update Human Relations Commission language to include gender neutral language; and E. Update Parks and Recreation Commission language to reflect name changes in Community Services Department divisions; and F. To leave the process of appointing unscheduled vacancies as it currently stands. MOTION AS AMENDED PASSED: 4-0 1 of 3 CITY OF PALO ALTO December 11, 2017: — City Council — Consent Staff Report 1 Action Minutes 1 Transcript 1 Video City Council consideration of an Ordinance implementing the Policy and Services Committee recommendation. Title: Adoption of an Ordinance Amending Chapters 2.16 (Boards and Commissions Generally), 2.18 (Public Art Commission), 2.20 (Planning and Transportation Commission), 2.21 (Architectural Review Board), 2.22 (Human Relations Commission), 2.24 (Library Advisory Commission) and 2.25 (Parks and Recreation Commission) of Title 2 (Administrative Code) of the Palo Alto Municipal Code to Modify the Start of Terms on the Boards and Commissions, and accompanying Code Cleanup in Chapters 2.22 and 2.25. MOTION: Vice Mayor Kniss moved, seconded by Mayor Scharff, third by Council Member Tanaka to pull Agenda Item Number 14- Adoption of an Ordinance Amending Chapters 2.16 (Boards and Commissions Generally), 2.18 (Public Art Commission), 2.20 (Planning and Transportation Commission), 2.21 (Architectural Review Board), 2.22 (Human Relations Commission), 2.24 (Library Advisory Commission) and 2.25 (Parks and Recreation Commission) of Title 2 (Administrative Code) of the Palo Alto Municipal Code to Modify the Start of Terms on the Boards and Commissions, and accompanying Code Cleanup in Chapters 2.22 and 2.25. Item removed from the Consent Calendar March 5, 2018 — City Council - Consent Staff Report 1 Action Minutes 1 Transcript 1 Video City Council consideration of an Ordinance to implement changes to portions of the Municipal Code relating to the Human Relations Commission and the Parks & Recreation Commission. Title: Adoption of an Ordinance of the Council of the City of Palo Alto Amending Chapter 2.22 (Human Relations Commission) and Chapter 2.25 (Parks and Recreation Commission) of the Palo Alto Municipal Code to use Gender -neutral Language and add Gender Identity to the Human Relations Commission's Jurisdiction, and to Reflect the Community Services Department's Current Divisions. 2 of 3 Beth Minor City Clerk CITY OF PALO ALTO Recommendation: Staff recommends the City Council adopt an ordinance to: 1. Add "gender identity" to the Human Relations Commission's jurisdiction; 2. Update the Human Relations Commission ordinance to reflect gender neutral language; and 3. Update the Parks and Recreation Commission ordinance to reflect name changes in Community Services Department divisions Passed on Consent: 9-0 March 19, 2018 — City Council — Consent Staff Report 1 Action Minutes 1 Transcript 1 Video Second Reading: City Council consideration of an Ordinance to implement changes to portions of the Municipal Code relating to the Human Relations Commission and the Parks & Recreation Commission. Title: SECOND READING: Adoption of an Ordinance of the Council of the City of Palo Alto Amending Chapter 2.22 (Human Relations Commission) and Chapter 2.25 (Parks and Recreation Commission) of the Palo Alto Municipal Code to use Gender -neutral Language and add Gender Identity to the Human Relations Commission's Jurisdiction, and to Reflect the Community Services Department's Current Divisions (FIRST READING: March 5, 2018 PASSED 9-0). Passed on Consent: 5-0 Kniss, Kou, Tanaka, Wolbach absent 3 of 3 CITY OF PALO ALTO TO: HONORABLE CITY COUNCIL FROM: BETH MINOR, CITY CLERK DATE: DECEMBER 3, 2018 2 SUBJECT: AGENDA ITEM NUMBER 2- Appointment of Three Candidates to the Architectural Review Board and Three Candidates to the Parks and Recreation Commission for Three-year Terms Ending December 15, 2021; and two Candidates to the Planning and Transportation Commission for Four-year Terms Ending December 15, 2022 On December 2, 2018, the City Clerk's Office was notified that Elaine Uang withdrew her application for the Planning and Transportation Commission. The following 12 applicants remain eligible for appointment to the Planning and Transportation Commission: 1. Kelsey Banes 2. L. David Baron 3. Bern Beecham 4. Rebecca Eisenberg 5. Claude Ezran 6. Brian Hamachek 7. Michelle Kraus 8. Dena Mossar 9. Giselle Roohparvar 10. Thomas Siegel 11. Carolyn "Carl" Templeton 12. Craig Yanagisawa Beth Minor City Clerk 1 of 1 CITY OF PALO ALTO City of Palo Alto (ID # 9741) City Council Staff Report Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: Caltrain Go Pass Reauthorization for 2019 Title: Approval of an Agreement With the Peninsula Corridor Joint Powers Board in the Amount of $97,755 for the 2019 Caltrain Go Pass Program From: City Manager Lead Department: Human Resources Recommended Motion Staff recommends that City Council approve and authorize the City Manager or his designee to sign an agreement with the Peninsula Corridor Joint Powers Board for continuation of the Caltrain Go Pass program for the 2019 calendar year. Recommendation The City first piloted the Go Pass program in 2014 with 51 employees participating in the commute program and later expanded the program to all benefited City employees in the Downtown City locations. Of the eligible employees as of November 2018, 166 employees have been issued a Go Pass. The Go Pass program provides employees with the ability to commute on CalTrain without restrictions as to how far the employee may commute to Palo Alto, ranging from San Francisco down to Gilroy. The cost of the program is funded out of the General Benefits Fund, an internal service fund that collects funds from City departments to pay for various employee benefits. Extending the Go Pass program will continue to reduce the inflow and outflow of traffic during peak commute hours and help address record level congestion as detailed in the Metropolitan Transportation Commission's report released in September of 2017. Executive Summary Staff is returning to Council for authorization of the Caltrain Go Pass program to continue forward as parking and traffic remain a concern in Downtown Palo Alto. The City is focused on developing a commuter incentive program to encourage employees to use sustainable transportation modes. Staff recommends that all employees located at Civic Center (City Hall, Development Center, Palo Alto Police Department and the Downtown Library) receive a Caltrain Go Pass through 2019. Caltrain's Go Pass pricing program for the City of Palo Alto is based on a per eligible employee City of Palo Alto Page 1 structure and per eligible user. In 2019, the cost per eligible employee cost increased by 20%, from $237.50 to $285, due to Caltrain's increasing operating costs. In 2019, the total cost for 343 eligible employees in 2019 will be $97,755 which represents a net 17% increase in cost to the City. This total headcount excludes sworn public safety employees as they are not subject to ridership fees. In addition, the City is responsible for the replacement of any lost passes, estimated to reach $2,400, though actual costs depend on actual passes lost. Staff members who receive a Go Pass are required to complete a quarterly reporting of usage in order to keep their Go Pass active throughout 2019. Resource Impact Sufficient funding for this program was approved in the Fiscal Year 2019 Adopted Operating Budget General Benefits Fund in anticipation of staff recommending an extension of the Go Pass Program through the end of calendar year 2019. The program cost for 2019 is $97,755 compared to $83,838 in 2018. Funding for this program in years beyond calendar year 2019 is subject to the appropriation of funds and is anticipated to be addressed through the development of the FY 2020 Budget. Environmental Review The Agreement is not a project for purposes of the California Environmental Quality Act and therefore no environmental review is required. Attachments: • Attachment A - City of PA Go Pass Agreement City of Palo Alto Page 2 PENINSULA CORRIDOR JOINT POWERS BOARD 2019 CALTRAIN GO PASS AGREEMENT Participant Name: City of Palo Alto Address: Legal Notice Address (if different from above): Contact Person: Email: Phone: Fax: Total Payment: $97,775.00 Number of Participating Sites: 1 Number of Go Pass Users as defined below: 343 Go Pass Eligibility Business All staff working more than 20 hours per week, excluding temporary employees, interns, contractors, consultants and sworn peace officers** are considered "Go Pass Users" for the purpose of this Agreement. Temporary employees, interns, contractors, consultants and sworn peace officers** are not eligible to participate in the Go Pass Program. Notwithstanding the foregoing, if one or both of the Options offered below is selected, employees working less than 20 hours per week and/or interns will be considered "Go Pass Users" under this Agreement. Options Include staff working less than 20 hours per week: N/A — Not including Include interns: N/A — Not including ❑ Residential All residents five years old and older are considered "Go Pass Users" for the purpose of this Agreement. Employees of residential developments are excluded from the Go Pass Program. ❑ Educational All students per selected group (i.e. Part-time, Full-time, Post graduates) are considered "Go Pass Users" for the purpose of this Agreement. Agreement Term: January 1, 2019 through December 31, 2019 Participant agrees to the attached terms and conditions CITY OF PALO ALTO* PENINSULA CORRIDOR JOINT POWERS BOARD By: By: Print Name: Seamus P. Murphy Its: Chief Communications Officer Print Name: Its: By: Print Name: Its: * If Participant is a corporation or limited liability company, two corporate officers must sign on behalf of the corporation as follows: 1) the chairman of the board, president or vice-president; and 2) the secretary, assistant secretary, chief financial officer, or assistant treasurer. In the alternative, this Agreement may be executed by a single officer or a person other than an officer provided that evidence satisfactory to the JPB is provided demonstrating that such individual is authorized to bind the corporation (e.g. a copy of a certified resolution from the corporation's board or a copy of the corporation's bylaws). ** Uniformed and non -uniformed, sworn peace officers are allowed to ride Caltrain for free subject to showing the proper identification. 1 14769948.1 TERMS AND CONDITIONS This Go Pass Agreement ("Agreement") is made between the Peninsula Corridor Joint Powers Board, a public agency ("JPB") and the Go Pass Participant ("Participant") identified on page 1 of this Agreement. 1. PAYMENT: Full payment for all Go Pass stickers shall be due prior to JPB issuing stickers. The total cost of participating in the Go Pass program will be the greater of $23,940.00 or $285.00 per eligible Go Pass User, which includes a non-refundable Administration Fee (the "Administration Fee") of $3 per Go Pass User. If the number of Users increases during 2019, the cost of additional Go Pass stickers will be a pro -rated per amount based on Exhibit A on page 5 of this Agreement. Go Pass Participant may share the cost of participation in the Go Pass program with its Users, but the cost to a particular User cannot be higher than the first-time replacement rate stated in Section 10 below. Participant must submit payment for any invoices within 30 days of the date shown on the invoice. Payments after 60 days will be charged a late fee of $5 per day. Accepted payment methods include ACH, EFT and Participant checks. Personal Go Pass User checks are not accepted. The return of a check (electronic or paper) issued to JPB will result in a $25 returned check fee being placed on the account of the Participant. 2. PROGRAM: JPB operates the "Caltrain" rail service between San Francisco and Gilroy, California, and Participant desires to provide a transit benefit for use on Caltrain to all of the Go Pass Users as defined on Page 1, in the form of a sticker affixed to a valid Participant -issued, JPB-approved, Go Pass User photo identification card (hereafter referred to as "Go Pass"). In order to facilitate the Caltrain Go Pass Program ("Program") JPB shall provide the necessary stickers and accept the Go Pass as valid fare media for travel on the Caltrain system. Participant is responsible for any stickers in its possession. Failure to comply with the terms in this Agreement may result in termination pursuant to Section 12. 3. ELIGIBLE PARTICIPANTS: Only individual Participants are eligible to participate in the Program. Participants with multiple locations, branches or campuses are eligible to participate in the Program and must provide a Go Pass User count for each individual Participant site. However, such Participants must enroll in the Program under a single Go Pass Agreement and designate a single contact and administrator. Such Participants' employees/students/residents at non- participating locations are not eligible to participate in the Program. 4. ELIGIBLE GO PASS USER VERIFICATION: Go Passes must be purchased for each and every Go Pass User at each Participant work site participating in the program ("Participating Site(s)"). Participant will be required, prior to the JPB issuing the Go Pass stickers, to provide JPB with a Letter of Intent ("Letter") signed by the Human Resources Director, an officer of the Participant or Development Manager verifying the then -current number of Go Pass Users of the Participant at each Participating Site. If a Business Participant selects an Option identified on Page 1, the letter must indicate the number of Users working more than 20 hours per week, working less than 20 hours per week and/or interns. If there are multiple Participating Sites, the Letter must indicate the individual site addresses and the number of then -current Users at each site. Neither Participant nor any of its affiliates shall be required to participate in the Program with respect to other sites other than the Participating Site(s) identified in the Letter. 5. GO PASS IDENTIFICATION: Participant must have an official Participant -issued photo ID card in order to participate in the Program and must supply a hard copy of that ID card to the JPB for review. Any Participant that doesn't have a photo ID card must create one. The ID card must display a clear Go Pass User headshot, Go Pass User first and last name, have a 1" x 1" square space for the Go Pass sticker and display the Participant name or logo. The ID cannot contain Caltrain's logo as part of the design. If the ID changes, it is the Participant's responsibility to submit the new version to the JPB three weeks in advance for approval. Participants may only use one JPB-approved ID card. The JPB will produce and issue serialized Go Pass stickers which will be distributed to Participant so that Participant can affix them to the Participant -issued Go Pass User ID card. Participant's designated administrator shall place the Go Pass sticker on each eligible Go Pass User's ID card, preferably on the front. Participant shall not distribute the Go Pass stickers to Users, as this practice may lead to unauthorized use of the sticker. Participant shall be responsible for retaining the Go Pass User's ID card or removing the Go Pass sticker from a Go Pass User's ID card when a Go Pass User leaves the employment of the Participant or relocates to non -participating location. Returned ID cards or stickers shall be presented to the JPB for verification upon request. A photocopy of the identification card with the Go Pass sticker attached is acceptable as proof that the Go Pass is no longer in use by a Go Pass User who has left the Participant. All Go Pass stickers allotted to the Participant at the beginning of the Participant's participation in the Program that are not issued to Users are to be returned to the JPB by December 15 of the Agreement year. Go Pass sticker is JPB's property. 6. PROGRAM RECORDS: Participant will create and maintain a file of documents to be available for review upon JPB request ("Go Pass File"). The Go Pass File must include a log (Go Pass Log) of its Users who currently hold Go Passes. The Go Pass Log shall include the Go Pass User's first and last name, unique serial number for the individual pass each Go Pass User holds, pass status (i.e. active, lost, damaged, etc.), date of issue, date of Go Pass User separation, if applicable, and any other pertinent information. The file must also include all separated Go Pass User's ID cards or Go 2 14769948.1 Pass stickers unless sent to JPB and Participant received an acknowledgement e-mail. 7. SURVEY AND ACKNOWLEDGEMENT: Prior to affixing the Go Pass sticker to the Go Pass User's Participant -issued ID card, Participant shall require each Go Pass User receiving a Go Pass, for the first time, to complete an online questionnaire ("Survey"). Once the Survey is complete, Participant administrator will receive an e-mail confirmation from the Go Pass User via the JPB. As part of completing the survey, the Go Pass User will be required to acknowledge that he or she understands the proper use of the Go Pass. The Surveys may be used to analyze the success of the Program and develop ridership projections for the Program. However, the Surveys are subject to disclosure under requests made pursuant to the California Public Records Act. Prior to disclosing Surveys, any identifying information concerning the Participant and/or the Go Pass User shall be redacted. 8. PROGRAM ANALYSIS AND AUDIT: JPB reserves the right to audit Participant's Go Pass Program at any point during the Program year with five (5) working days' notice. The purpose of the audit is to ensure that appropriate accounting, sticker distribution and security procedures are in place. JPB has the right to audit any internal Participant Go Pass -associated records, including Participant's Go Pass File. A current list of qualifying Users shall be provided to the JPB upon request. Within 10 working days of receipt of any audit report from the JPB, Participant must, in conjunction with JPB staff, develop a mutually agreeable action plan to satisfy any audit findings. If no mutually agreeable plan can be developed, JPB may terminate the Program upon 10 -days' notice pursuant to the terms of Section 12, Termination. 9. PARKING PERMITS: Monthly parking permits for Caltrain lots may be purchased through any Caltrain station ticket machine. Go Pass Users will be required to complete an application for an access code in order to purchase the permit through the machine. 10. LOST, STOLEN, DAMAGED AND REPLACEMENT GO PASSES: For lost or stolen Go Passes, JPB will charge a $285.00 first-time replacement fee. Participant must submit to the JPB documentation including the Go Pass User first and last name and Go Pass serial number. For stolen Go Passes, the JPB will replace the Go Pass at no additional charge provided that a police report is supplied to the JPB which describes the Go Pass as stolen. If the same Go Pass User loses the Go Pass or has the Go Pass stolen a second time, the replacement fee will be 2x the first-time replacement fee regardless of whether a police report is provided to the JPB. If a replacement Go Pass is issued and then the original is found, JPB will not provide a refund. Participant may not resell the Go Passes to Users at a rate higher than the replacement fee. A Go Pass will not be issued as a replacement for lost or stolen Go Passes a third time. For Damaged Go Passes: If the Participant or a Go Pass User damages a Participant -issued ID card and thus renders the Go Pass sticker unusable, or if the sticker itself is damaged, a replacement Go Pass sticker may be issued to the Go Pass User or taken from the Participant's Go Pass inventory, provided that the Participant documents that the Go Pass sticker has been taken out of circulation in its Go Pass File. Participant must retain the damaged ID card or Go Pass sticker in its Go Pass File unless sent to JPB and Participant received an acknowledgement e-mail. If no additional stickers remain in the Participant inventory, the Participant shall return damaged Go Pass stickers or ID cards, or a photocopy, with complete documentation to the JPB prior to the JPB issuing a replacement Go Pass sticker to Participant at no charge. This courtesy will be extended no more than two times per Go Pass User per calendar year, after which the replacement cost for a damaged Go Pass sticker will be $285.00. For Separated Users: If the Go Pass User separates with the Participant, Participant shall retain the separated Go Pass User ID card or Go Pass sticker in its Go Pass File and document that the Go Pass sticker has been taken out of circulation in its Go Pass Log (See Section 6 above) unless sent to JPB and Participant received an acknowledgement e- mail. If no additional stickers remain in the Participant inventory, the Participant shall return separated Go Pass stickers or ID cards, or a photocopy, prior to the JPB issuing a replacement Go Pass sticker to Participant at no charge. For Missing Go Passes: Participant shall be responsible for safeguarding the Go Pass stickers prior to issuing them to Users and shall be liable for any loss of Go Pass stickers. Replacement Go Pass stickers shall be issued under the lost terms above. 11. REPORTING: Participant must submit a report to JPB by March 1, June 1, September 1 and December 1 of the agreement term year. The report must list all lost, stolen, damaged and replacement Go Passes issued and separated Users. It must include the reason for replacement, if applicable, Go Pass User first and last name and corresponding Go Pass serial number and the current number of Users working at the work site(s) /residing in the development enrolled in the program. Participant may submit its Go Pass Log (See Section 6 above) in lieu of the report. 12. TERMINATION: Either party may terminate this Agreement by giving the other party written notice at least 90 days prior to the desired termination date, which shall be the last day of a calendar month. If either party terminates the 3 14769948.1 Agreement pursuant to this provision, JPB shall refund to Participant a pro -rata portion of Participant's total payment in accordance with the Proration Schedule attached to and incorporated in this Agreement as Exhibit A, less the Administration Fee, as listed on Page 1, within 30 days of the termination date, provided that within 10 working days of the effective termination date: (a) all undistributed Go Passes issued to Participant are returned to JPB and (b) Participant verifies in writing that it has made every Good faith effort to collect or destroy all Go Passes that have been distributed to Users. In the event Participant fails to comply with the terms of this Agreement, JPB may terminate this Agreement with 15 days' notice. Non-compliance by Participant may make Participant ineligible to participate in the Go Pass program in subsequent years. This Agreement shall automatically terminate if Participant discontinues its business at the Participating Site(s) and it will be up to Participant to notify its Go Pass Users that the Go Pass will no longer be valid. In the event that Go Pass Users continue to use invalid Go passes, JPB will confiscate such passes in accordance with Section 14. 13. MISUSE OF GO PASS: The Go Pass constitutes a Go Pass sticker affixed to a valid, Participant -issued, JPB- approved Go Pass User photo ID card. Any other use of the Go Pass sticker is prohibited and will not be valid as fare payment on Caltrain. Go Pass Participant — JPB agrees not to pursue any claims or demands against Participant for a Go Pass User's unauthorized use of the Go Pass, unless the unauthorized use is the result of Participant's failure to follow the sticker issuance procedures in Section 5, gross negligence or willful misconduct. The transfer of the Go Pass sticker constitutes fare evasion, a violation of California Penal Code 640. At the time of Go Pass issuance, Participant shall (1) notify its Users that Go Pass stickers are non-transferrable and that transferring a Go Pass constitutes fare evasion under the law, and (2) shall remind Users of their agreement to the terms of usage provided in the Survey. Go Pass User - All Go Pass Users shall be subject to JPB's fare inspection regulations. JPB may confiscate and/or destroy the Go Pass sticker and pursue claims or demands against, or seek prosecution of, anyone who duplicates, alters, transfers, sells or commits unauthorized use of the Go Pass. Unauthorized use of the Go Pass includes, but is not limited to, allowing a non -eligible person to use a Go Pass or affixing a Go Pass sticker to any form of identification other than a valid Participant -issued, JPB-approved, Go Pass User ID card. JPB may cancel any individual Go Pass if it has reason to believe that the Go Pass was issued and/or used in a manner that fails to comply with the requirements herein. JPB will notify Participant if it has any such concerns and, after appropriate investigation, revoke those passes in question. Participant agrees to cooperate with JPB in such an investigation, including assisting the JPB in determining the identity of the Go Pass User(s) who are alleged to have misused the Go Pass. Participant waives all remedies and rights to refunds for any Go Passes revoked for misuse. JPB will incur no liability resulting from confiscation of misused Go passes or Go passes from a Go Pass User whose Participant's Agreement has been terminated. 14. PROTECTION OF PRIVACY: The JPB contracts with a third -party online survey platform, currently SurveyGizmo, to facilitate Participant registration and agreement to the user terms and conditions of the Program, facilitate administration of the Program by the participating company, and collect Caltrain usage information. Participants are directed to review SurveyGizmo's website and privacy policy for additional information regarding SurveyGizmo's data privacy and security provisions. JPB acknowledges that it may review data stored on the online survey platform that contains personally identifiable information (PII) or confidential information about the Participant or the Go Pass User ("Information") to administer the Go Pass Program. If requested by a Participant's Go Pass administrator, the JPB may share a list of Go Pass User names with the administrator directly from the online survey platform. The JPB does not store any PII collected through the Go Pass Program on its servers. Except as required to administer the Go Pass Program in accordance with this Agreement or as otherwise required by law, JPB agrees not to use or to disclose to third parties the Information. Notwithstanding the foregoing, JPB may use and disclose to third parties information in an aggregate format that does not personally identify a Go Pass User. 15. ENTIRE AGREEMENT: This contract contains the entire Agreement between the parties hereto for the term specified on Page 1 of this Agreement and cannot be changed or altered except by written agreement signed by both parties hereto. Neither party shall be bound by any oral agreement or other understandings contrary to or in addition to the terms and conditions as stated herein. 16. SUCCESSORS AND ASSIGNS: The terms, covenants and conditions contained in this Agreement shall bind and inure to the benefit of Participant and JPB and, except as otherwise provided herein, their personal representatives and successors and assigns. 17. NO THIRD -PARTY BENEFICIARIES: There are no third -party beneficiaries to this Agreement. 4 14769948.1 18. NO JOINT VENTURE: It is expressly agreed that Participant is not, in any way or for any purpose, a partner of the JPB in the conduct of JPB's business or a member of a joint enterprise with JPB, and does not assume any responsibility for JPB's conduct or performance of this Agreement. It is expressly agreed that JPB is not, in any way or for any purpose, a partner of the Participant in the conduct of Participant's business or a member of a joint enterprise with Participant, and does not assume any responsibility for Participant's conduct or performance of this Agreement. 19. ATTORNEYS' FEES: In the event that either JPB or Participant fails to perform any of its obligations under this Agreement or in the event a dispute arises concerning the meaning or interpretation of any provision of this Agreement, the defaulting Party or the Party not prevailing in such dispute, as the case may be, shall pay any and all costs and expenses incurred by the other Party in enforcing or establishing its rights hereunder, including, without limitation, court costs and reasonable attorneys' fees. 20. GOVERNING LAW: This Agreement shall be governed and construed in accordance with the laws of the State of California. Any action relating to, and all disputes arising under, this Agreement shall be instituted and prosecuted in a court of competent jurisdiction in the State of California. 21. NOTICES: All notices, requests, communications and legal notices to be made or given to Participant under this Agreement shall be addressed as shown on page 1 of this Agreement. All notices, including legal notices, communications and requests to be made or given to JPB shall be addressed as follows: Peninsula Corridor Joint Powers Board (Caltrain) 1250 San Carlos Ave. San Carlos, CA 94070-1306 Attn: Market Research and Development 5 14769948.1 Exhibit A Proration Schedule New Participants Effective Date (falling in month) Portion of Total Fee per Go Pass More than Minimum (includes administration fee) Portion of Total Fee per Go Pass Less than Minimum (includes administration fee) February $261.50 $21,966.00 March $238.00 $19,992.00 April $214.50 $18,018.00 May $191.00 $16,044.00 June $167.50 $14,070.00 July $144.00 $12,096.00 August $120.50 $ 10,122.00 September $97.00 $ 8,148.00 October $73.50 $6,174.00 November $50.00 $ 4,200.00 December $26.50 $ 2,226.00 Terminating Participants Effective Termination Date (falling in month) Portion of Total Fee Returned per Go Pass More than Minimum (less administration fees) Portion of Total Fee Returned per Go Pass Less than Minimum (less administration fees) February $258.50 $21,714.00 March $235.00 $19,740.00 April $211.50 $17,766.00 May $188.00 $15,792.00 June $164.50 $13,818.00 July $141.00 $11,844.00 August $117.50 $9,870.00 September $94.00 $7,896.00 October $70.50 $5,922.00 November $47.00 $3,948.00 December $23.50 $1,974.00 6 14769948.1 CITY OF PALO ALTO City of Palo Alto (ID # 9761) City Council Staff Report Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: Approval of the 2018 Electric Integrated Resource Plan (EIRP) and Related Documents Title: Finance Committee Recommendation that the City Council 1) Adopt a Resolution Approving the 2018 Electric Integrated Resource Plan (EIRP), Updated Renewable Portfolio Standard Procurement Plan and Enforcement Program, and 2) Approve Two EIRP Planning Documents From: City Manager Lead Department: Utilities Recommendation Staff, the Utilities Advisory Commission (UAC), and the Finance Committee recommend that the City Council: 1. Adopt a Resolution (Attachment A) to approve the following: a. The 2018 Electric Integrated Resource Plan (EIRP) (Attachment B); b. An updated Renewable Portfolio Standard (RPS) Procurement Plan (Appendix B to Attachment B); c. An updated RPS Enforcement Program (Appendix C to Attachment B); d. The following four standardized tables (Appendix D to Attachment B): i. Capacity Resource Adequacy Table (CRAT); ii. Energy Balance Table (EBT); iii. Greenhouse Gas (GHG) Emissions Accounting Table (GEAT); iv. RPS Procurement Table (RPT); and 2. Approve the EIRP Objective and Strategies to guide future analysis and decisions (Attachment C); and 3. Approve the EIRP Work Plan outlining planned staff initiatives to implement the EIRP (Attachment D). EXECUTIVE SUMMARY Palo Alto regularly engages in long-term planning to optimally meet the community's electrical loads with electric supplies. This planning was previously conducted under the framework of the Long-term Electric Acquisition Plan (LEAP) and in the future will be conducted under the City of Palo Alto Page 1 EIRP framework', which the City is required to complete every five years under state law (Senate Bill (SB) 350). The current EIRP, which must be approved by Council by January 1, 2019 to satisfy the City's SB 350 regulatory requirements, has a planning period of 2018 through 2030. The City of Palo Alto Utilities (CPAU) currently has sufficient supply resources to meet projected loads through 2030, with approximately 45% of its resources from hydro supplies and the remaining 55% from renewable contracts.2 The City's 20 -year contract with the Western Area Power Administration (Western) for hydroelectric resources, which supplies nearly 40% of the City's energy needs in a normal hydro year, expires at the end of 2024. A primary focus of the EIRP, given its large supply cost implications, is the question of whether to renew the contract with Western for an additional 30 -year term (and if so, at what participation level) and/or seek other renewable supplies to meet City loads. Along with the City's final 2018 EIRP, this report includes: (1) an updated RPS Procurement Plan; (2) an updated RPS Enforcement Program; (3) a set of four standardized tables that the City is required to submit to the CEC along with the EIRP; (4) the proposed EIRP Objective and Strategies to guide future analysis and decisions; and (5) an EIRP Work Plan with a set of new initiatives and timelines for their completion, which staff recommends undertaking in order to prepare the City's electric supply portfolio for the upcoming shifts in the electric utility industry —including additional analysis focused on the 2025 Western contract decision and portfolio rebalancing initiatives. Although the approval of the EIRP in and of itself does not authorize or directly impact any supply portfolio -related costs, the initiatives that will be undertaken in the coming years under the EIRP Work Plan —in particular the Council decisions on renewing the Western contract and how to rebalance the supply portfolio —will greatly influence the electric supply costs in the coming decades. BACKGROUND The last time the City completed an integrated resource plan (IRP) was in 2012, when the City's updated Long-term Electric Acquisition Plan (LEAP) was approved by Council on April 16, 2012 (Staff Report 2710, Resolution 9241). A few years later, in 2015, Senate Bill 350 (SB 350) was signed into law, and it includes a requirement that publicly -owned utilities (POUs) serving loads greater than 700,000 megawatt -hours per year, such as Palo Alto, develop and adopt an IRP and 1 Staff will hereafter discontinue using the term LEAP and in the future use the term EIRP when seeking long-term electric portfolio plan approvals from the Council. 2 The City's first long-term renewable contract —for wind power —expires at the end of 2021 and the other wind contract and all five landfill -gas -to energy contracts expire in the late 2020's or early 2030's, while the solar contracts all extend beyond 2040. City of Palo Alto Page 2 submit it to the California Energy Commission (CEC) by January 2019 and every five years thereafter.3 The current EIRP planning period is from 2018 through 2030. As noted in the EIRP report (Attachment B), through 2028 the City has sufficient resources to meet its forecasted electric loads, with renewable power contracts supplying over 50% of its needs and the remainder coming from hydroelectric resources. The City's contract for the Western hydroelectric resource expires at the end of 2024, but is available to be renewed under similar contractual terms for an additional 30 -year period. A major consideration for the EIRP—and the subject of a significant amount of the efforts outlined in the work plan (Attachment D) —is whether to renew the contract with Western (and if so, at what participation level) and/or seek other carbon neutral power supplies.4 This decision will have significant long-term ramifications for the electric utility —on its overall supply costs, cost uncertainty, market price exposure, and the supply portfolio's GHG emissions levels and RPS level. As part of the 2012 LEAP update, the City Council approved a set of electric portfolio decision - making Objectives and Strategies. At the outset of the current EIRP development process, staff developed an updated Objective and Strategies (Attachment B). The current version, which aligns with the Utilities 2018 Strategic Plan, is very similar to the ones adopted in 2012, although the new Objective and Strategies place greater emphasis on managing uncertainty related to resource availability and costs, regulatory uncertainty, and the increased penetration of DERs. Beginning in June 2017, staff has presented 13 different reports to the UAC and Council (including the present one) directly or indirectly related to the development of Palo Alto's 2018 EIRP. These presentations and reports are summarized in Table 1 below. Table 1: Public Process Summary for Development of the 2018 EIRP Forum Date Topic Link UAC 6/7/2017 Overview of CPAU's EIRP Development Process Report UAC 8/2/2017 Discussion of DER Plan Development Report UAC 8/2/2017 Discussion of California Wholesale Energy Market and Electric Portfolio Cost Drivers Report UAC 9/6/2017 Discussion of Hydroelectric Resources and Carbon Neutral Portfolio Alternatives Report 3 The Clean Energy and Pollution Reduction Act of 2015 also raised the state's renewable portfolio standard (RPS) to 50% by 2030 and required a doubling of energy efficiency savings by 2030. The primary objective of the IRP requirement in SB 350 is to ensure that the state's large POUs are on track to reduce their greenhouse gas emissions, helping the state meet its overall target of reducing GHG emissions to 40% below 1990 levels by 2030. 4 Based on the current milestone schedule presented by the Western Area Power Administration (Western) related to the post -2024 contract extension process, staff's understanding is that the City must execute the new contract, accepting the updated project allocation, by July 2020. However, according to Western there will be a "one-time contract reduction/termination provision" available to customers who execute the new contract in July 2024. https://www.wapa.gov/regions/SN/PowerMarketing/Documents/2025/2025-milestone-schedule.pdf City of Palo Alto Page 3 UAC 11/1/2017 Discussion of Proposed DER Plan Report UAC 12/6/2017 Discussion of Renewable and Carbon Neutral Portfolio Strategy Report UAC 4/12/2018 Assessment of CPAU's Distribution System to Integrate DERs Report UAC & Council 5/2/18 & 5/21/2018 CPAU Demand Side Management Annual Report — FY 17 UAC, Council UAC 6/6/2018 Long-term Electric Portfolio Analysis Results and Options for Rebalancing Portfolio in the Next Five to Ten Years Report UAC 9/5/2018 2018 EIRP Executive Summary, Objective & Strategies, Work Plan Report UAC 10/W2018 Recommendation to Approve the 2018 EIRP Report Financ e 10/16/2018 Recommendation to Approve the 2018 EIRP Report Council 12/3/2018 Recommendation to Approve the 2018 EIRP TBD Through these presentations and discussions, staff has laid out the motivations and context for the EIRP, and described the resources currently in the City's supply portfolio as well as the upcoming planning decisions and uncertainties facing the City. Staff felt that this level of public discussion was important given that: (1) the City must make some important planning decisions in the next several years that have significant fiscal implications for the utility, and (2) the electric utility industry has undergone dramatic changes since Palo Alto prepared its last LEAP update in 2012, with a major shift underway towards greater levels of variable, distributed, low -emissions generation, along with an expanding suite of regulatory mandates that the City must satisfy. CEC IRP Guidelines & Required Elements The schedule and structure of the EIRP process has been dictated in large part by regulatory requirements imposed by SB 350,5 which states that Palo Alto's IRP must be adopted by Council by January 1, 2019, submitted to the CEC by April 30, 2019, and updated at least every five years thereafter. At a minimum, Sections 9621 and 454.52 of the State Public Utilities Code require that the City's IRP shall: • Ensure procurement of at least 50% renewable resources by 2030; • Meet Palo Alto's share of the greenhouse gas emission reduction targets established by the California Air Resources Board (CARB) for the electricity sector, to enable California to achieve the economy wide greenhouse gas emissions reductions of 40% from 1990 levels by 2030; • Minimize impacts to customer bills; • Ensure system and local reliability; • Strengthen the diversity, sustainability, and resilience of the bulk transmission, distribution systems and local communities; SB 350 also requires the doubling of energy efficiency savings targets by 2030 and establishes a new Renewable Portfolio Standard (RPS) to meet 50% of the City's load from applicable renewable supplies by 2030. The 10 -Year Energy Efficiency Potential Plan approved by Council in March 2017 addresses the new energy efficiency savings requirements, while the City expects to achieve an RPS of 59% in 2018. City of Palo Alto Page 4 • Enhance distribution systems and demand -side energy management; • Minimize localized air pollutants and other greenhouse gas emissions with early priority to disadvantaged communities; and • Address the following procurement topics: o Energy efficiency and demand resources that are cost effective, reliable and feasible; o Energy storage; o Transportation electrification; o A diversified procurement portfolio of short-term electricity, long term electricity, and demand response products; and o Resource adequacy capacity. The EIRP report presented as Attachment B satisfies all the above statutory requirements. And it is worth noting that Palo Alto has already exceeded the state's 2030 goals under SB 350 of sourcing 50%6 of electricity supplies from renewable resources and reducing greenhouse gas emissions by 40% —which are the primary drivers of the IRP requirement in the first place. DISCUSSION An IRP represents a snapshot of a continuously evolving and transforming process, as the conditions and circumstances in which utilities make planning and procurement decisions are ever-changing. The IRP process utilizes a methodology and framework for assessing a utility's shifting business and operating requirements and adapting to factors such as changing technology, regulations, and customer behavior and preferences. Assumptions, scenarios, and results are all reviewed and updated as information and events unfold, and the process is continually revisited. Proposed Work Plan As described in detail in the EIRP, Palo Alto faces a wide range of uncertainties in the course of the EIRP planning horizon. In particular, there is significant uncertainty around the costs and generation levels associated with the Western hydro resource, and around the magnitude and shape of the City's customer load. As such, and as part of the process of revisiting the assumptions and analysis described in the EIRP, staff developed a proposed work plan describing ongoing activities and new initiatives, along with timelines for completing these initiatives, to be undertaken as a means to mitigate the uncertainties mentioned above. The seven new initiatives identified in the proposed work plan (Attachment D) and associated timelines are summarized in Table 2 below. 6 Note that on 9/10/18, the Governor signed SB 100 into law, which raises the 2030 RPS requirement for all utilities from 50% to 60%. If the City does not execute any new renewables contracts (or extend any existing ones), staff projects that its RPS level will reach 63% in 2021, then gradually decrease to 46% in 2030 as older contracts expire. Given that renewable energy certificates (RECs) from renewable resources can be "banked" in one year and used for compliance purposes in later years, the current set of renewables contracts is likely sufficient to ensure the City's compliance with state RPS mandates well beyond 2030. City of Palo Alto Page 5 Table 2: New Initiatives and Timeline from the EIRP Work Plan Summary of New Work Plan Initiatives Timeline 1. Western Contract Decision: Evaluate the merits of committing to a new 30 - year contract with Western starting in 2025. • Recommendation on initial commitment to the Western contract • Recommendation on final commitment to the Western contract - Early 2020 - Early 2024 2. Portfolio Rebalancing Analysis: Evaluate the merits of rebalancing the electric supply portfolio to lower seasonal and daily market price exposure by more closely matching the City's hourly and monthly electric loads — Initial scoping assessment report. Dec 2019 3. COTP decision — Evaluate how to best utilize the City's share of the California - Oregon Transmission Project (COTP) when the long-term layoff of this asset ends in 2024. Evaluate opportunities to use this transmission line to import renewable energy from the Pacific Northwest as part of Initiative #2. Dec 2019 4. Carbon accounting — Evaluate the carbon content of the electric portfolio on an hourly basis, and discuss the merits of buying carbon offsets to ensure the carbon content of the cumulative hourly portfolio is zero on an annual basis — Initial staff recommendation by December 2019. Dec 2019 5. RPS compliance strategy review — Investigate the merits of monetizing excess RECs to minimize the cost of maintaining an RPS compliant and carbon neutral electricity supply portfolio — Initial staff recommendation by December 2019. Dec 2019 6. Partner with external agencies — Explore greater synergistic opportunities with NCPA and other agencies to lower Palo Alto's operating costs — Initial assessment report by December 2019. Dec 2019 7. Competitive assessment and load uncertainties — Undertake a competitive assessment for the electric utility within the context of the large proliferation of customer -sited DER technologies, and develop contingencies to address the potential for large changes in the City's load level or load profile — Initial assessment report by December 2020. Dec 2020 It should be noted that many of the new initiatives listed above have the same projected completion date. This is intentional, and it is due to the fact that many of these initiatives are highly interrelated: a decision related to the City's RPS compliance strategy, carbon accounting methodology, Western contract renewal, or portfolio rebalancing will impact all of the other decisions. As such, rather than independent reports for each initiative listed, staff may produce a series of reports that address several of these areas at once. In addition to these new initiatives, staff will continue its activities in pursuit of lowering the overall cost to serve load (and addressing the tradeoffs between pursuing sustainable supply resources and lowering supply costs). These include continuing to optimize the use of the City's City of Palo Alto Page 6 Calaveras resource, and evaluating the benefits of the NCPA pool and/or the procurement of alternative scheduling services for its renewable resources. COMMITTEE REVIEW AND RECOMMENDATION On October 3, 2018, the UAC reviewed and discussed the EIRP report and its appendices and related documents. Commissioners noted their appreciation for staff's work developing the EIRP and work plan. Commissioners also requested confirmation (which staff provided) that the EIRP lays out a series of future policy and strategic decisions that need to be made in the coming years, and that approval of the EIRP does not commit the City to any policy or strategic decisions. Commissioners made a point to note that the Western Base Resource hydroelectric contract is currently the lowest cost resource in the City's electric supply portfolio. And Commissioners emphasized the need to be realistic in our assumptions and goals (e.g., with respect to the rate of adoption of electric vehicles in the City by 2030) and to be forthright with the public (e.g., about our ability to supply our portfolio with carbon free electricity at all hours of the year). Commissioners also asked for staff to provide periodic updates to the UAC on the new initiatives being undertaken through the work plan, and staff readily agreed to provide those. After this discussion, the UAC voted unanimously (6-0, Ballantine absent) to support the staff recommendation. Attached are the excerpted draft minutes of this meeting (Attachment E). At its October 16, 2018 meeting, the Finance Committee reviewed and discussed the EIRP report and its appendices and related documents. Finance Committee members asked staff a variety of background questions about various elements of the EIRP report and presentation — for example, requesting additional details on the California -Oregon Transmission Project, and about the definition of the term "stranded assets." Council member Tanaka asked about the feasibility of participating in pumped hydro storage projects, and requested that staff look into this issue. He also asked about the status of staff's evaluation of financial derivatives as a hedging mechanism. Staff noted that they had considered the use of derivatives in the process of evaluating the Hydro Rate Adjustment mechanism (Staff Report 8962) and had found them not to be financially advantageous to the City. Staff already uses fixed -price forward contracts as part of its power hedging program. After discussion, the Finance Committee voted 4-0 to recommend that Council approve the EIRP report and related documentation, as recommended by staff and the UAC. Attached are the excerpted draft minutes of this meeting (Attachment F). NEXT STEPS Under state law, final approval of the EIRP report is required by January 1, 2019, and the report and required documentation must be submitted to the CEC by April 30, 2019. Once approved, staff will begin executing the tasks listed in the Work Plan, and will provide the UAC and Council with updates on the progress, successes, and new challenges over the implementation period of City of Palo Alto Page 7 this IRP. The City's EIRP must be updated, approved, and re -submitted to the CEC at least once every five years. RESOURCE IMPACT Using existing staffing resources, staff expects to devote approximately 0.75 to 1.5 FTE in the coming years to pursuing elements associated with the Work Plan, including investigating strategies to rebalance the electric portfolio to meet the challenges of the coming decades. In addition, staff has access to a wide pool of resources through NCPA to assist with the new initiatives listed in Attachment C. The 2025 Western contract decision, in particular, is a complex and highly important matter, and staff may seek external consulting and legal assistance to augment NCPA's resources and services, as well as those of the City Attorney's office. The cost of such external resources may amount to $100,000 to $200,000 over the next few years. The annual budget associated with electric power purchases is $61.5 million in FY 2019, of which costs related to the Western contract account for $13.5 million. The uncertainly in cost and value associated with the Western hydro resource is considerable over the 30 -year term starting 2025. Though the approval of the EIRP by itself does not have direct impact on portfolio -related costs, the different initiatives that will be undertaken in the coming years —in particular the Council decision on whether and how to rebalance the supply portfolio —will greatly influence the electric supply costs in the coming decades. POLICY IMPLICATIONS The EIRP report, Objective and Strategies, and Work Plan are in line with the Utilities Strategic Plan mission and strategic direction. Specifically, the EIRP report itself was contemplated under Strategy 4, Action 5, of the Financial Efficiency and Resource Optimization Priority of the Utilities 2018 Strategic Plan. These EIRP documents are also in line with the Sustainability and Climate Action Plan goals of continuing to lower the carbon footprint of the community. ENVIRONMENTAL REVIEW The Council's adoption of the 2018 EIRP report and related documents 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)). Attachments: • Attachment A: Resolution Approving the 2018 EIRP and Related Documents • Attachment B: 2018 Electric Integrated Resource Plan (EIRP) • Attachment C: 2018 EIRP Objective & Strategies • Attachment D: 2018 EIRP Work Plan • Attachment E: Excerpted Draft Minutes of the October 3, 2018 UAC Meeting • Attachment F: Excerpted Minutes of the Oct 16, 2018 Finance Committee Meeting City of Palo Alto Page 8 Attachment A * NOT YET APPROVED * Resolution No. Resolution of the Council of the City of Palo Alto Approving the 2018 Electric Integrated Resource Plan (EIRP), Updated Renewable Portfolio Standard Procurement Plan and Enforcement Program, and Related Documents RECITALS A. Senate Bill 350 was adopted in 2015, establishing a requirement that requires publicly owned utilities (POUs) with an average load greater than 700 GWh (in the 2013-16 period) to adopt Integrated Resource Plans (IRP) by January 1, 2019, submit them to the California Energy Commission (CEC), and update them at least once every five years thereafter. B. Based on historical data, the City of Palo Alto is one of 16 California POUs that are required to file an IRP. C. The CEC is required to review POU IRPs for consistency with Public Utilities Code 9621 and recommend corrections to deficiencies in the plans, according to the Publicly Owned Utility Integrated Resource Plan Submission and Review Guidelines (POU IRP Guidelines) most recently adopted by the CEC in August 2018. D. The POU IRP Guidelines require POUs to submit certain supporting information along with the IRP, including a set of four standardized tables and a Renewable Portfolio Standard (RPS) Procurement Plan. E. The City of Palo Alto first adopted an RPS Procurement Plan on December 12, 2011 (Resolution 9215) and last updated it on November 12, 2013 (Resolution 9381). F. The City of Palo Alto also adopted an RPS Enforcement Program on December 12, 2011 (Resolution 9214), which has not been updated since that date. The Council of the City of Palo Alto does hereby RESOLVE as follows: SECTION 1. (Attachment B). The Council hereby approves the 2018 Electric Integrated Resource Plan SECTION 2. The Council hereby approves the four standardized tables that accompany the 2018 EIRP (Appendix D to Attachment B). SECTION 3. The Council hereby approves the updated Renewable Portfolio Standard Procurement Plan that will be submitted to the CEC in conjunction with the 2018 EIRP (Appendix B to Attachment B). 1 Attachment A * NOT YET APPROVED * SECTION 4. The Council hereby approves the updated Renewable Portfolio Standard Enforcement Program (Appendix C to Attachment B). SECTION 5. The Council finds that the adoption of this resolution approving the EIRP and related documents 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)). 2 Attachment A * NOT YET APPROVED * INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Assistant City Attorney City Manager Utilities General Manager Director of Administrative Services 3 ATTACHMENT B City of Palo Alto 2018 Electric Integrated Resource Plan CITY OF PALO ALTO UTILITIES Table of Contents Table of Contents I. Executive Summary 1 A. CEC IRP Guidelines & Required Elements 3 B. Public Process Summary 4 11. Background & Achievements to Date 6 A. CPAU History and Mission Statement 6 B. Previous IRPs & Recent Accomplishments 6 C. Changing Planning Environment 7 i. Increasing DER Penetration & Load Profile Uncertainty 7 ii. GHG Emission Reductions 9 iii. Renewable Portfolio Standards (RPS) 9 iv. Energy Efficiency 10 D. Overview of EIRP methodology 10 111. Forecast Methodology for Energy and Peak Demand 12 A. Description of Econometric Forecast Models 14 i. Energy Econometric Model 14 ii. Peak Demand Econometric Model 14 B. Description of Distributed Energy Resources Forecasts 14 i. Energy Efficiency Forecast 16 ii. Solar Photovoltaic Forecast 17 iii. Transportation Electrification Forecast 17 iv. Energy Storage Forecast 17 v. Demand Response Forecast 18 vi. Electrification of Space and Water Heating Forecast 18 vii. SB 338 Requirements 18 IV. Existing Resource Portfolio 20 A. Energy Efficiency & Local Renewable Generation 21 i. Energy Efficiency 21 ii. Local Renewable Generation 22 B. Hydroelectric Resources 23 i. Western Base Resource 23 ii. Calaveras 25 C. Renewable Energy Resources 26 i Table of Contents 1. Wind PPAs 26 ii. Landfill Gas (LFG) PPAs 26 iii. Solar PPAs 26 D. Market Purchases & RECs 27 E. COBUG 27 F. California -Oregon Transmission Project (COTP) 27 G. Resource Adequacy Capacity 28 V. Future Procurement Needs and Portfolio Rebalancing 29 A. Needs Assessment: Energy, RPS, Resource Adequacy Capacity 29 B. Portfolio Rebalancing Analysis 30 i. Portfolio Expected Net Value 33 ii. Portfolio Fit 34 iii. Portfolio Cost Uncertainty and Management 35 VI. Supply Costs & Retail Rates 36 VII. Transmission & Distribution Systems 37 A. Transmission System 37 B. Distribution System 37 VIII. Low-income Assistance Programs 38 IX. Localized Air Pollutants 39 A. Electric Vehicle Programs 39 B. Local Renewable Energy Programs 39 C. Electrification of Space and Water Heating Programs 39 D. Refrigerant Recycling Program 40 X. Path Forward & Next Steps 41 A. Recommended Portfolio 41 B. GHG Emissions 42 C. Scenario Analysis 42 D. Next Steps 43 E. Key Issues to Monitor & Attempt to Influence 43 XI. Appendices XI -1 A. Key Supplemental Reports and Documents XI -1 B. RPS Procurement Plan XI -2 C. RPS Enforcement Program XI -16 ii Table of Contents D. Standardized IRP Tables XI -20 i. Capacity Resource Adequacy Table (CRAT) XI -20 ii. Energy Balance Table (EBT) XI -21 iii. GHG Emissions Accounting Table (GEAT) XI -22 iv. RPS Procurement Table (RPT) XI -23 List of Figures Figure 1: The Duck Curve — Net Load in California with Penetration of Intermittent Generation 8 Figure 2: Palo Alto Power Supply in 2012 and 2018 10 Figure 3: Annual Energy Forecast including DERs (2018-2030) 13 Figure 4: Impact of DERs on Hourly Summer Load Shape in 2030 13 Figure 5: Projected Palo Alto Electric Supply Mix in CY 2020 by Resource Type 20 Figure 6: Palo Alto's RPS Generation Projections and RPS Compliance Requirements 29 Figure 7: Expected Net Value of New Resources and Western Relative to Market Value 33 Figure 8: Average Hourly Load and Generation Profiles for Each Month for Western and Potential New Resources (Normalized to Average Hourly Load) 34 Figure 9: Palo Alto's Projected Resource Supply Mix in 2030 41 Figure 10: CPAU Electric Supply GHG Emissions (2005-2030) 42 List of Tables Table 1: California Energy Market Changes Since 2012 1 Table 2: City of Palo Alto Energy -Related Changes Since 2012 2 Table 3: Public Process Summary for Development of the 2018 EIRP 5 Table 4: Projected Number of DER Systems (2017-2030) 15 Table 5: Projected Contribution to Energy Sales of DER Systems (2017-2030) 15 Table 6: Palo Alto's Resource Adequacy Capacity Portfolio 28 Table 7: Relative Merits of Candidate Resources Considered to Rebalance Supply Portfolio 32 List of Key Supplemental Reports and Documents 1. NCPA-CAISO Metered Sub -System Agreement 2. Ten -Year Electric Energy Efficiency Goals (2017) 3. Energy Storage Assessment Report (2017) 4. Proposed Distributed Energy Resources Plan (2017) 5. Distribution System Assessment Report (2018) 6. Demand Side Management Annual Report (2018) iii Section 1: Executive Summary I. Executive Summary The City of Palo Alto's 2018 Electric Integrated Resource Plan (EIRP) is a comprehensive plan for developing a portfolio of power supply resources to meet the utility's objective of providing safe, reliable, environmentally sustainable, and cost-effective electricity services while addressing the substantial risks and uncertainties inherent in the electric utility business. The EIRP also supports the City's mission to promote and sustain a superior quality of life in Palo Alto. In partnership with our community, our goal is to deliver cost-effective services in a personal, responsive and innovative manner. The IRP meets the requirements of California Senate Bill (SB) 350 (de Leon, Chapter 547, Statutes of 2015), which requires publicly owned utilities (POUs) with an average annual energy load greater than 700 gigawatt-hours (GWh) to submit an IRP at least every five years to the California Energy Commission (CEC). The EIRP discusses current and anticipated California regulatory and policy changes facing Palo Alto and the electric utility industry. Additionally, the IRP presents the analyses conducted and underlying assumptions, and outlines a resource plan to reliably and affordably meet customers' energy needs through calendar year 2030. The electric utility industry has undergone significant changes since Palo Alto prepared its last Long- term Electric Acquisition Plan (LEAP) update in 2012, with a major shift underway towards greater levels of variable, distributed, low -emissions generation, along with an expanding suite of regulatory mandates that the City must satisfy. Table 1 provides an overview of some of the key structural changes in California's electricity market that must be addressed in the 2018 EIRP, compared to their status at the time of the 2012 LEAP update. Table 1: California Energy Market Changes Since 2012 2012 Status 2018 Status GHG Emissions Targets Statewide emissions reduced to 40% below 1990 levels by 2030 1990 levels by 2020 Cap and Trade Authorized through 2020 Authorized though 2030 Renewable Procurement 33% by 2020 and beyond 50% by 2030 and beyond Distributed Generation Energy Efficiency Energy Storage Modest growth High growth Transportation Electrification Utility -specific targets (all cost- effective energy efficiency) No explicit requirement No explicit requirement Structured Markets Resource Adequacy Hourly market Statewide goal of doubling energy efficiency savings by 2030 Requirement to study adoption of targets Requirement to address procurement of EV infrastructure Intra-hour market Local and system capacity requirements Local, system, and flexible capacity requirements 1 Section 1: Executive Summary Similarly, Palo Alto itself has undergone a myriad of changes over the past six years —both in its long- term planning goals and in how it uses electricity currently. Table 2 describes some of the major changes and accomplishments in Palo Alto since 2012, from dramatic changes in the City's power supply and emissions reduction targets, to considerable growth in local solar generation and electric vehicles (EVs). Table 2: City of Palo Alto Energy -Related Changes Since 2012 Topic 2012 Status 2018 Status Community -wide GHG Emissions (from electricity, natural gas and transportation) Goal: Reduce GHG emissions to 15% below 2005 levels by 2020. Achieved: 22% below 2005 emission levels (28% below 1990 emissions levels). Electric Supply Portfolio Goal: 33% RPS by 2015 Achieved: 21% RPS r Local Solar PV Systems Goal: 0.71% of load by 2017 Achieved: 0.57% of load (502 systems) Energy Efficiency Goal: Reduce GHG emissions to 80% below 1990 by 2030. Achieved: 43% below 1990 emission levels. Goal: 50% RPS by 2030; 100% Carbon Neutral by 2015 Achieved: 58% RPS; 100% Carbon Neutral Goal: 0.63% avg. annual load savings; 4.8% cumulative savings (2014-2023) Achieved: 0.68% of avg. annual load; 4.2% cumulative 6 -year savings (2007-2012) Energy Storage Goal: No explicit goal. Goal: 4% of load by 2023 Achieved: 1.94% of load (1,081 systems) Goal: 0.75% avg. 5.7% cumulative (2018-2027) Achieved: 0.73% of avg. annual load; 4.4%1 cumulative 6 -year savings (2013-2018) annual load savings; savings Goal: No explicit goal or rebates as not yet cost-effective. Facilitate customer adoption in coordination with Building department. Transportation Electrification Goal: Support California State goal Goal: Target 90% EVs by 2030 Achieved: approx. 200 EVs registered in Palo Alto. Annual Energy Load Achieved: approx. 3,000 EVs registered in Palo Alto; 60 public EV chargers; Incentives for EV charger installation. 972 GWh 925 GWh Summer Peak Capacity Load Average Retail Rate2 170 MW 11.6 cents/kWh 182 MW 13.9 cents/kWh Includes savings related to Codes and Standards changes, as well as estimated savings for 2018. 2 Section 1: Executive Summary The EIRP planning period is from 2018 to 2030. Through 2028, the City of Palo Alto Utilities (CPAU) has sufficient renewable contracts to supply over 50% of the City's needs. The City's first long-term renewable contract —for wind power —expires at the end of 2021 and the other wind contract and all five landfill -gas -to energy contracts expire in the late 2020's or early 2030's, while the solar contracts all extend beyond 2040. The City's contract with the Western Area Power Administration (WAPA) for hydroelectric resources, which supplies nearly 40% of the City's energy needs in a normal hydro year, expires at the end of 2024. A major consideration for the EIRP is whether to renew the contract with WAPA (and if so, at what participation level) and/or seek other renewable supplies. CPAU expects to continue operating within the Northern California Power Agency's (NCPA) Metered Sub -System Aggregation (MSSA) Agreement with the California Independent System Operator (CAISO). Under this agreement, NCPA balances CPAU's loads and resources to comply with CAISO planning and operating protocols. With resources available under the NCPA MSSA Agreement, Palo Alto has access to sufficient system, local, and flexible capacity, as well as resources to provide ancillary services to reliably meet City loads. Costs are projected to increase through 2030, primarily due to system upgrade costs, increasing environmental regulations, and renewable integration costs (which are part of the tradeoff between pursuing sustainable electricity supplies and reducing overall supply costs). Costs are increasing, but retail energy sales are decreasing due to increases in energy efficiency and local solar installations, and are further expected to decline in 2020 and beyond due to building codes mandating new homes be net zero annual energy. Part of this reduction in electrical energy use is expected to be offset by higher penetration of electric vehicles and electrification of natural gas appliances. CPAU staff will provide public updates on the progress, successes, and new challenges over the implementation period of this IRP. A. CEC IRP Guidelines & Required Elements The schedule and structure of the EIRP process is being guided in large part by requirements imposed by SB 350,3 which states that Palo Alto's IRP must be adopted by Council by January 1, 2019, submitted to the CEC by April 30, 2019, and updated at least once every five years thereafter. At a minimum, Sections 9621 and 454.52 of the State Public Utilities Code require that the City's IRP will need to: • Ensure procurement of at least 50% renewable resources by 2030 (see EIRP Sections II.B, II.C.iii, V.A, X.A) • Meet Palo Alto's share of the greenhouse gas emission reduction targets established by the California Air Resources Board (CARB) for the electricity sector, to enable California to 2 Retail rate and energy efficiency values are for Fiscal Years 2012 and 2018; the rest of the values in Table 2 are for Calendar Years 2012 and 2018. 3 SB 350 also requires the doubling of energy efficiency savings targets by 2030 and establishes a new Renewable Portfolio Standard (RPS) to meet 50% of the City's load from applicable renewable supplies by 2030. The 10 -Year Energy Efficiency Potential Plan approved by Council in March 2017 addresses the new energy efficiency savings requirements and the City expects to achieve an RPS of 58% in 2018. 3 Section 1: Executive Summary achieve the economy wide greenhouse gas emissions reductions of 40% from 1990 levels by 2030 (Sections II.B, II.C.ii, X.B) • Minimize impacts to customer bills (Section VI) • Ensure system and local reliability, including in the hour of peak net demand (Sections III.B.vii, IV.E, IV.F, VII) • Strengthen the diversity, sustainability, and resilience of the bulk transmission, distribution systems and local communities (Sections II.B, IV.A.ii, IV.E, IV.F, VII, VIII) • Enhance distribution systems and demand -side energy management (Sections IV.A.i, VII.B) • Minimize localized air pollutants and other greenhouse gas emissions with early priority to disadvantaged communities (Sections II.B, IV.A.ii, IX) • Address the following procurement topics: o Energy efficiency and demand resources that are cost effective, reliable and feasible (Sections II.B, II.C.iv, III.B.i, IV.A.i) o Energy storage (Section III.B.iv) o Transportation electrification (Section II.B, III.B.iii) o A diversified procurement portfolio of short term electricity, long term electricity, and demand response products (Section III.B.v) o Resource adequacy (Sections IV.G, V.A) The City currently has the resources and systems in place needed to achieve all of the objectives addressed by these IRP requirements. In addition, CPAU is submitting the following four Standardized Tables as part of the EIRP: • Capacity Resource Accounting Table (CRAT): Annual peak capacity demand in each year and the contribution of each energy resource (capacity) in the POU's portfolio to meet that demand. • Energy Balance Table (EBT): Annual total energy demand and annual estimates for energy supply from various resources. • RPS Procurement Table (RPT): A detailed summary of a POU resource plan to meet the RPS requirements. • GHG Emissions Accounting Table (GEAT): Annual GHG emissions associated with each resource in the POU's portfolio to demonstrate compliance with the GHG emissions reduction targets established by the California Air Resources Board (CARB). This EIRP along with the four aforementioned Standardized Tables and the materials listed in the Supporting Information section satisfy the IRP filing guidelines listed in Chapter 2 of the CEC guidelines. B. Public Process Summary Palo Alto staff has provided numerous reports and presentation related to various facets of the EIRP to the Utilities Advisory Commission (UAC) over the past 15 months. The current EIRP report was reviewed by the UAC on September 5, 2018 and October 3, 2018, before being presented to the Finance Committee and City Council for approval in October and November 2018. Table 3 below lists all public presentations related to the EIRP, with links to the associated reports. 4 Section 1: Executive Summary Table 3: Public Process Summary for Development of the 2018 EIRP Forum Date UAC UAC UAC UAC UAC UAC UAC & Council UAC UAC UAC Topic Overview of CPAU's EIRP Development Process 8/2/2017 Discussion of DER Plan Development 8/2/2017 Discussion of California Wholesale Energy Market and Electric Portfolio Cost Drivers 9/6/2017 Discussion of Hydroelectric Resources and Carbon Neutral Portfolio Alternatives 11/1/2017 12/6/2017 Discussion of Proposed DER Plan Discussion of Renewable and Carbon Neutral Portfolio Strategy 4/12/2018 5/2/18 & 5/21/2018 6/6/2018 9/5/2018 10/3/2018 Finance 10/16/2018 Council Nov 2018 Assessment of CPAU's Distribution System to Integrate DERs CPAU Demand Side Management Annual Report — FY 17 Long-term Electric Portfolio Analysis Results and Options for Rebalancing Portfolio in the Next Five to Ten Years Discussion of 2018 EIRP Executive Summary, Objective & Strategies, and Work Plan Recommendation to Approve CPAU's 2018 EIRP Recommendation to Approve CPAU's 2018 EIRP Approval of CPAU's 2018 EIRP Report Report UAC, Council Report Report TBD TBD TBD An IRP represents a snapshot of a continuous process that evolves and transforms over time. The conditions and circumstances in which utilities must make decisions about how to meet customers' future electric energy needs are ever-changing. The IRP process utilizes a methodology and framework for assessing a utility's ever-changing business and operating requirements and adapting to factors such as changing technology, regulations, and customer behavior. Assumptions, scenarios, and results are all reviewed and updated as information and events unfold, and the process is continually revisited under formal or informal resource planning efforts. 5 Section 11: Background & Achievements to Date 11. Background & Achievements to Date A. CPAU History and Mission Statement The City of Palo Alto Utilities' (CPAU) history began over one hundred years ago, in 1896, when the water supply system was first installed. Two years later, the wastewater or sewer collection system came online. In 1900, the municipal electric power system began operation, followed in 1917 by a natural gas distribution system. While CPAU and the utilities industry have evolved dramatically over 118 years, the City has nonetheless maintained a consistent set of core values: Quality, Courtesy, Efficiency, Integrity, and Innovation. Palo Alto's 2018 EIRP is a comprehensive planning document to guide long-term power planning aligned with CPAU's Mission Statement, which is "to provide safe, reliable, environmentally sustainable and cost effective services."4 B. Previous IRPs & Recent Accomplishments Palo Alto regularly engages in long-term planning efforts related to its electric supply portfolio — previously under the auspices of the Long-term Electric Acquisition Plan (LEAP) and in the future under the EIRP.5 The last time the City completed a LEAP update was on April 16, 2012 (Staff Report 2710, Resolution 9241). A few years later, in 2015, Senate Bill 350 (SB 350) was signed into law, and it includes a requirement that publicly -owned utilities (POUs) serving loads greater than 700,000 megawatt -hours per year, such as Palo Alto, develop and adopt an IRP by January 1, 2019 and submit it to the CEC by April 30, 2019 and every five years thereafter.6 As part of the 2012 LEAP update, the City Council approved a set of electric portfolio decision -making Objectives and Strategies. At the outset of the current EIRP development process, staff developed an updated Objective and Strategies. The current version, which aligns with the Utilities 2018 Strategic Plan, is very similar to the ones adopted in 2012, with the new Objective and Strategies placing greater emphasis on managing uncertainty related to resource availability and costs, regulatory uncertainty, and the increased penetration of DERs. The 2012 LEAP update included an Implementation Plan describing a set of ongoing tasks and new initiatives for the City to undertake in order to satisfy the LEAP Objectives and Strategies. In carrying out this Implementation Plan and other initiatives, Palo Alto has accomplished the following over the past six years: 4 See the City of Palo Alto Utilities 2018 Strategic Plan, which includes the Mission Statement and Strategic Direction, here: https://www.cityofpaloalto.org/civicax/filebank/documents/64505. 5 Staff will hereafter discontinue using the term LEAP and in the future use the term EIRP when seeking long-term electric portfolio plan approvals from the Council. 6 The Clean Energy and Pollution Reduction Act of 2015 also raised the state's renewable portfolio standard (RPS) to 50% by 2030 and required a doubling of energy efficiency savings by 2030. The primary objective of the IRP requirement in SB 350 is to ensure that the state's large POUs are on track to reduce their greenhouse gas emissions, helping the state meet its overall target of reducing GHG emissions to 40% below 1990 levels by 2030. 6 Section 11: Background & Achievements to Date • Developed a Carbon Neutral Electric Supply Plan and implemented it every year, beginning in 2013; • Increased the renewable energy supply from 21% of total load to 57% of total load; • Reduced GHG emissions related to electricity by 109,000 MT CO2e, helping reduce community - wide emissions by 43% compared to 1990 levels; • Developed and launched a Feed -in Tariff program (Palo Alto CLEAN) for local renewable energy projects, which currently has 1.6 MW of operating solar PV projects and an additional 1.3 MW of solar projects in development; • Executed six new utility -scale solar contracts (totaling 153 MW of capacity), of which five projects (127 MW capacity) are currently operational; • Achieved cumulative energy efficiency savings of 4.4%' since 2012; • Coordinated with other departments on the installation of 60 public EV charger ports owned and maintained by the City; • Approved a Local Solar Plan setting a goal of producing 4% of the community's power supply with local solar resources by 2023; • Approved an Electrification Work Plan to facilitate the electrification of natural gas loads in buildings and facilitate adoption of electric vehicles; • Adopted aggressive energy efficiency goals which are 20% greater than a business as usual approach and require new and innovative programs; • Adopted a Sustainability and Climate Action Plan with a goal of reducing community emissions to 80% below 1990 levels by 2030; • Approved a new CPAU Strategic Plan; and • Continued to balance our own loads and resources under the CAISO-NCPA Metered Subsystem Agreement. C. Changing Planning Environment Across the industry, integrated resource planning has undergone significant changes in recent years. Traditionally, an IRP was an opportunity for a utility to evaluate the steady growth of its customer loads over a 10+ year planning horizon, and develop a plan for meeting that load growth through staged additions of new centralized thermal generation resources. Today's IRPs, however, have to consider how to integrate increasing volumes of variable and/or distributed generation in an environment of declining loads and increasing regulatory mandates, all while maintaining reliability and controlling costs. Accordingly, the objective of this IRP is to evaluate Palo Alto's portfolio of resources against the changing utility landscape and California's environmental requirements, while recommending strategies to ensure Palo Alto continues to meet the Council's goals for affordability and sustainability. The following is a description of some of the primary changes to the utilities planning environment over the past several years. i. Increasing DER Penetration & Load Profile Uncertainty California's resource mix has changed considerably as a result of its ambitious renewable mandates and the rapidly declining costs of solar and wind resources. The shift to renewables has led to lower (sometimes negative) market prices for power at certain times of the day, but has changed the daily Includes savings related to Codes and Standards changes, as well as estimated savings for 2018. 7 Section 11: Background & Achievements to Date load shape, which traditionally had a single peak lasting a few hours each day. The changing load shape means new resources will be needed, and existing resources will need to be used differently, while maintaining affordability for customers. Solar and wind resources, unless paired with multi -hour energy storage systems, are intermittent sources of generation, where energy output is a function of fuel availability (i.e., sunlight and wind). In order to accommodate large volumes of intermittent resources, the system must include a sufficient supply of highly responsive resources (or load) to follow this new demand profile, which is referred to as net load (i.e., gross electricity consumption less intermittent generation). Recent capacity additions for RPS compliance have largely been solar resources, which are introducing a surplus of energy supply in the daytime hours, particularly in the spring and fall when renewable resources maintain higher levels of output and customer loads are at seasonal lows. Figure 1: The Duck Curve — Net Load in California with Penetration of Intermittent Generation (Source: CAISO) 27,000 25,000 23,000 21,000 17,000 15,000 13,000 11,000 201 .; Significant change < starting in 2015 Potential over -generation 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Figure 1 is a visual representation of the difference in load vs net load, highlighted by the beige area. This is commonly referred to in the industry as the "duck curve." As seen in Figure 1, solar contributes to meeting load in the middle of the day, but rapidly trails off in the evening when load is still at or near its daily peak. For reliability, this creates the added capacity challenge of being able to meet the ramp, in addition to meeting peak demand. The resource fleet must be able to ramp down in the morning to accommodate increases in solar output, then ramp back up very rapidly to meet peak demand as solar generation diminishes with the setting sun. And while utility -scale solar is a challenge for grid operators to integrate, the growing amounts of distributed solar are an even more vexing, as these resources are essentially invisible to grid operators — thus they add a significant amount of uncertainty to net load projections. 8 Section 11: Background & Achievements to Date ii. GHG Emission Reductions In 2006, California passed Assembly Bill (AB) 32, the California Global Warming Solutions Act. AB 32 is a mandate for several sectors, including the electricity sector, to reduce GHG emissions to 1990 levels by 2020. In 2016, AB 32 was augmented by Senate Bill (SB) 32, which mandated a GHG emissions reduction target of 40% below 1990 levels by 2030. California's goal of reducing GHG emissions will be achieved through a combination of market mechanisms (Cap and Trade) and prescriptive mandates (RPS) to retire and replace high emitting resources with cleaner resources. In order to achieve the SB 32 targets, many sectors of the economy — including industry, transportation, and electricity — will need to reduce their GHG emissions. The state's electric sector GHG emissions in 1990 were 108 MMT CO2e. Reducing this amount by 40% creates a target of 64 MMT CO2e; however, CARB's proposed range of 30-53 MMT CO2e for the electricity sector is a 51% to 72% reduction, well in excess of the sector's pro -rata share of the overall reduction target.' The electricity sector is expected to surpass its pro -rata emission reduction share due primarily to the 50% RPS goal and aggressive energy efficiency requirements. SB 350 requires that POU IRPs not only describe how they will meet their 2030 50% RPS target, but also how they will contribute to the electricity sector's share of GHG emissions reductions by 2030. For benchmarking in this IRP and for portfolio planning purposes, Palo Alto used the mid -range value of 42 MMT CO2e as the 2030 target for the electricity sector (of which Palo Alto's Toad -based pro rata share is 73,013 MT CO2e). These goals are for planning purposes and not compulsory; however, if changes to the regulations occur, Palo Alto will reflect those updates in its future resource planning efforts. iii. Renewable Portfolio Standards (RPS) One of the primary mechanisms for reducing GHG emissions in the electricity sector is the state's RPS. The state's RPS program mandates that an increasing percentage of retail sales be served by qualifying renewable generation. An RPS mandate was first imposed on Palo Alto by SB X1-2 in 2011, and subsequently expanded by SB 350 in 2015. Currently, the major targets are 33% renewables by 2020, and 50% by 2030. In addition to the minimum renewable generation procurement requirements, the RPS program also includes portfolio balancing requirements and long-term contract requirements, as described in Palo Alto's RPS Procurement Plan (included as Supplementary Information). Palo Alto satisfies its RPS requirements through a diverse portfolio of qualifying renewable resources — wind, solar, bioenergy (landfill gas), and small hydro. In addition, approximately half of Palo Alto's load is served by large hydro, a carbon -free resource that helps reduce GHG emissions, yet cannot be counted for RPS compliance. Figure 2 illustrates Palo Alto's actual and projected power supply mix for 2012 and 2018. (Note that 2012 was a slightly dry year, so the hydroelectric supply was a bit lower than average. Also, about 1% of the overall hydro supply is RPS-eligible "small hydro.") If the City $ The two other major sectors in the economy are the industrial and transportation sectors. In the Scoping Plan, CARB estimates the industrial sector can reduce GHG emissions between 8% and 15%, while the transportation sector can reduce GHG emissions between 27% and 32%. Much of the transportation sector's emissions reduction burden is expected to be shifted to the electricity sector via transportation electrification, which was not accounted for in CARB's Scoping Plan. This means the electricity sector's GHG emissions reduction burden will be even greater than it appears. 9 Section 11: Background & Achievements to Date 2012 renews its contract with the Western Area Power Administration after 2024, the 2030 power supply mix is projected to be similar to the 2018 mix, but with less wind and landfill gas and more solar. Figure 2: Palo Alto Power Supply in 2012 and 2018 Solar 2018 Landfill Gas 10% Hydro 49% iv. Energy Efficiency California has continually increased the energy efficiency of its new buildings and appliances since the Warren Alquist Act of 1974. These efficiency standards (Title 24) were updated to mandate Zero Net Energy (ZNE) residential new construction starting in 2020. ZNE homes require energy efficiency that will be achieved through implementing a high -efficiency envelope (insulation, windows, etc.), and efficient heating, ventilation, and air conditioning units. The remaining energy consumption must be offset by on -site generation, sized so that the annual building electricity consumption is equal to the building's electricity generation. By 2030, staff anticipates that the CEC will incorporate a carbon metric as part of the Title 24 building standards. D. Overview of EIRP methodology Integrated resource planning is the process that utilities undertake to determine a long-term plan to ensure generation resources are adequate to meet projected future peak capacity and energy needs, while achieving other utility goals such as maintaining an adequate capacity reserve margin for system reliability. Resource plans must ensure generation reliability is maintained at or above industry - standard levels. IRPs should also forecast long-term costs and potential rate impacts to customers to ensure that the utility can monitor and track trends with sufficient time to implement solutions to ensure reliability, compliance, and affordable electric service. An effective resource plan should also 10 Section 11: Background & Achievements to Date provide a reasonable degree of flexibility for the utility to deal with uncertainty in technological change and future regulations. IRPs require the use of sophisticated analytical tools capable of evaluating and comparing the costs and benefits of a comprehensive set of alternative supply and demand resources. Supply options typically include the evaluation of new conventional generation resources, renewable energy technologies, and distributed energy resources. Demand options typically include consideration of demand response programs, energy efficiency programs, and other "behind the meter" options which may reduce the overall load that the utility must be prepared to supply. IRPs utilize various economic analyses and methodologies to assess alternative scenarios (e.g., different combinations of supply and demand resources) and sensitivities to key assumptions to arrive at an economically optimal resource plan (subject to various constraints, such as regulatory mandates and local policies). The key steps in the resource planning process are outlined below. Step 1: EXAMINE PLANNING FRAMEWORK AND RISKS: Identify and assess challenges the utility faces in the current business and regulatory environment. Step 2: ASSESS NEEDS: Develop forecasts of load changes (incorporating impacts of cost- effective demand -side resources), existing plant conditions, contract terms, and operational constraints to determine resource needs over the planning period. Step 3: CONSIDER RESOURCE OPTIONS: Evaluate available generation resources, including centralized and distributed renewables and long-term market power purchases to identify the role each will play in meeting customer needs and regulatory and policy goals. Step 4: DEVELOP RESOURCE PORTFOLIOS: Develop resource portfolios, and evaluate them quantitatively and qualitatively to determine a preferred portfolio. Evaluation relies upon GHG emission requirements, needs assessment, and planning data specified in previous steps. Step 5: PERFORM SCENARIO AND RISK ANALYSIS: Perform detailed evaluations of preferred resource portfolios through scenario and risk analysis, to assess performance under a range of potential market and regulatory conditions. Step 6: IDENTIFY PLAN: Identify a "Preferred Plan" based on the resource portfolio expected to reliably serve demand at a reasonable long-term cost, while achieving regulatory compliance, accounting for inherent risks, and allowing for flexibility to respond to future policy changes. 11 Section 1I1: Forecast Methodology for Energy and Peak Demand III. Forecast Methodology for Energy and Peak Demand Palo Alto's forecasted energy and demand were generated by creating an econometric model for monthly energy and peak demand and then combining them with separate forecasts for new distributed energy resources (DERs) expected to be deployed. This approach was used since the econometric models do not accurately capture new expected growth in these DERs. Separate models were used to forecast DERs of highest impact. After energy and peak demand profiles for these DERs were generated, these exogenous forecasts were then applied to the energy forecast as out -of -model adjustments. Equation 1: Methodology Energy and Peak Demand Forecast Total Forecast Energy OR Peak Demand = Econometric Forecast Energy OR Peak Demand + New DER Forecasts Energy OR Peak Demand More details on the DER forecasts and load shape profiles that were generated are available in the Proposed Distributed Energy Resources Plan, which was presented to the UAC in November 2017. The DERs modeled for the purpose of this analysis were: - Energy Efficiency (EE) - Solar Photovolatics (PV) - Electric Vehicles (EV) - Demand Response (DR) - Energy Storage (ES) - Heat -pump Water Heaters (HPWH) - Heat -pump Space Heaters (HPSH) The base case annual energy forecast is shown in Figure 3. The projected change in hourly load shape on a peak day in 2030 is shown in Figure 4. 12 Section 1I1: Forecast Methodology for Energy and Peak Demand Figure 3: Annual Energy Forecast including DERs (2018-2030) lT• HPSH HPWH lttttt■ EV PV M EE ---Sales Forecast without DERs —Sales Forecast with DERs - 1,050 850 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2 150 ss 100 - 50 - Figure 4: Impact of DERs on Hourly Summer Load Shape in 2030 0 -50 I 24 -Hour CPAU Load Profile for Peak Day 13 HPSH HPWH - ES - DR EV PV EE —2017 Load 2030 Load Annual Electricity Sales, GWh Section 1I1: Forecast Methodology for Energy and Peak Demand A. Description of Econometric Forecast Models The econometric model inputs (i.e. independent variables) have been selected based on the availability of data, economic theory, and tests to validate the forecasts with actual energy (or demand) data. The coefficients of the models were obtained via statistical estimation on historical (in -sample) data where the Yule -Walker Generalized Least Squares method was employed to take into account the autocorrelation structure of the residuals so as to obtain valid standard error estimates. The coefficients were then combined with forecasts of each driver (independent variable) to produce the forecasted energy (or peak demand). Forecasts of the economic driver variable were provided by the Bureau of Economic Analysis and the forecasted values provided by the UCLA Anderson Forecast group. Weather variables were obtained from NOAA, and the forecasted weather conditions were set to reflect normal weather based on average temperatures across the training data set. i. Energy Econometric Model The Energy forecast is an econometric model that maps a set of calendar variables, weather variables, and an economic driver variable onto Palo Alto's monthly energy consumption measured at its California Independent System Operator (CAISO) meter at the Palo Alto City Gate. The monthly calendar variables are used in the model to capture underlying changes in Palo Alto customers' electric consumption caused by changing daylight hours and seasonal electricity usage. Monthly Heating Degree Days and Cooling Degree Days are used to explain the variation in energy due to the weather. Investment in non-residential equipment and software as reported by the Bureau of Economic Analysis was used as the economic driver. This variable represents business activity in the computer software and equipment sector of the economy, which directly affects Palo Alto's utility customers' energy consumption. ii. Peak Demand Econometric Model The Peak Demand forecast is also an econometric model that maps a set of calendar variables, weather variables, and the energy forecast onto Palo Alto's monthly peak demand measured at its CAISO meter. Similar to the Energy Forecast, monthly dummy variables are used in the model to capture underlying changes in Palo Alto customers' electric consumption throughout the year. Daily heating and cooling degree days corresponding to the peak day of the month is used as the weather driver. Monthly historical energy usage is added as the final variable explaining peak demand. B. Description of Distributed Energy Resources Forecasts Distributed Energy Resource forecasts for a number of technologies were developed and presented to the Palo Alto UAC in the proposed Distributed Energy Resources Plan in November 2017. The distributed energy resources considered for the purposes of these analyses were: - Energy Efficiency (EE) - Solar Photovolatics (PV) - Electric Vehicles (EV) - Demand Response (DR) - Energy Storage (ES) - Heat -pump Water Heaters (HPWH) - Heat -pump Space Heaters (HPSH) 14 Section Ill: Forecast Methodology for Energy and Peak Demand DER penetration forecasts and load shape models were developed to address three main areas: 1. DER Adoption Projections: Adoption forecasts for each DER technology. 2. DER Load Impact Projections: Energy used or delivered to the system on an hourly and seasonal basis to determine the impact of DERs on electric sales and load shape. 3. DER Financial Impact Projections: Financial impact to the utility of DER adoption based on the adoption and load impact projections. This analysis considered only the impact to wholesale electric supply costs, and did not include the impact of changes to current rate structures. The detailed assumptions and limitations of each of these projections are discussed in their following respective sections. The forecasts of the number of distributed energy resources in Palo Alto are shown in Table 4. The impact that these DER systems will have on CPAU's net electricity sales is shown in Table 5, and previously in Figure 4. Table 4: Projected Number of DER Systems (2017-2030) Projected Number of Systems DER Technology 2017 (current) 2020 2030 PV 1,000 1,3 2,500 EV9 2,500 5,900 18,700 EE 40,880 45, 60,000 DR LES 1 HPWH 8 11 10 25 185 200 75 580 2,700 Table 5: Projected Contribution to Energy Sales of DER Systems (2017-2030) Contribution to Energy Sales 2017 (current) 20 030 DER Technology MWh MWh MWh - 15,000 -1.6% -18,800 -2.0% -45,200 -4.9% EV 7,100 0.8% 14,300 1.6% 54,800 6.0% EE - 55,300 -6.0% -78,800 -8.6% -139,200 -15.2% DR ES10 111.1, HPWH 7 23 200 0.02% 9 190 0.02% 2,500 0.3% HPSH 90 0.01% 2,800 0.3% 9 This is the total number of residential EVs currently registered in Palo Alto. There are also EVs which commute into Palo Alto, some of which charge while in Palo Alto and add to CPAU electricity sales. In addition to the residential EVs shown here, there are estimated to be approximately 3,100, 5,900 and 20,000 commuter EVs in 2017, 2020 and 2030 respectively. 10 Batteries and other ES devices may result in either net increased energy retail sales (due to battery losses where commercial customers use batteries to avoid CPAU demand charges) or net decreased energy retail sales (due to increased onsite consumption of behind the meter solar). For the purpose of these analyses these two effects are assumed to be roughly the same magnitude and therefore ES systems are not currently considered to have any net effect on energy sales. 15 Section 111: Forecast Methodology for Energy and Peak Demand Contribution to Energy Sales 2017 (current) 2020 2030 DER Technology Combined DER Impact: from 2007 MWh % MWh % -63,200 -6.9% -83,000 -9.1% MWh % -124,000 -13.6% Combined DER Impact: from 2017 -19,700 -2.2% -60,900 -6.6% CPAU Overall System Load Growth from 201711 -3,200 -0.3% -6,900 -0.8% 1. Energy Efficiency Forecast a. Committed Energy Efficiency AB 2021 (2006) required POUs to identify all potentially achievable cost-effective electric efficiency savings and to establish annual targets for energy efficiency savings over ten years, with the first set of EE targets to be reported to the CEC by June 1, 2007, and updated every three years thereafter. AB 2227 (2012) amended this target -setting schedule to every four years. Palo Alto adopted its first Ten - Year Energy Efficiency Portfolio Plan in April 2007, which included annual electric and gas efficiency targets between 2008 and 2017, with a ten-year cumulative savings goal of 3.5% of forecasted energy use. In accordance with California law, the electric efficiency targets were updated in 2010, with the ten-year cumulative savings goal doubling to 7.2% between 2011 and 2020. Since then, increasingly stringent statewide building code and appliance standards have resulted in substantial energy savings. However, these "codes and standards" energy savings cannot be counted toward meeting the utility's EE goals. The ten-year electric efficiency targets were updated again in 2012, with the ten-year cumulative electric efficiency savings being revised downwards to 4.8% between 2014 and 2023. For fiscal year (FY) 2017, CPAU achieved electric savings of 0.7% of load through its customer efficiency programs as shown in the most recent Demand Side Management Report. Cumulative electric efficiency savings since 2006 are about 6% of the FY 2017 electric usage. Adoption rates for EE are based on the 10 -year Energy Efficiency Goals for 2018-2027 which were updated in 2017. The ten-year cumulative electric efficiency savings target was updated to 5.7% between 2018 and 2027. These adopted goals are ambitious goals which include new programs in order to achieve a 20% increase over the last goals adopted. For the years 2028 through 2030 the assumed savings are the average of the savings in 2026 and 2027, which is the methodology suggested by the CEC for estimating savings beyond the ten-year energy efficiency goals.'2 More details on the EE methodology for market potential can be found in Staff Report 7718 from March 6, 2017. 11 Going forward from 2017 the total CPAU load is forecasted to grow at roughly 0.4% per year if no more DERs were added to the system. With the addition of new DERs, the total CPAU load is projected to decrease by roughly 0.8% from 2017 electricity sales by the year 2030. 12 The extension of savings through 2030 is based on the methodology put forth in the CEC presentation by Mike Jaske from September 7, 2017, which can be found here: CEC presentation on Energy Efficiency Savings from Utility Programs. 16 Section 1I1: Forecast Methodology for Energy and Peak Demand Although CPAU established its EE goals based on net savings, the energy efficiency savings shown in the tables and graphs here include EE savings due to free -ridership as well as savings from statewide codes and standards. b. Additional Achievable Energy Efficiency There is no additional achievable energy efficiency assumed in this EIRP forecast because the additional achievable energy efficiency is already included in the ambitious adopted energy efficiency goals for 2018 to 2027. These ambitious energy efficiency goals are 20% higher than a business -as - usual case and will require new innovative programs. ii. Solar Photovoltaic Forecast Solar PV projections are based on technical and economic potential; they indicate that adoption will grow steadily, with the growth rate itself plateauing as is typically seen in a maturing market. These projections include behind -the -meter installations in residential and commercial sectors, but do not include a potential Community Solar installation that has recently been discussed by the Palo Alto UAC. In April 2014, the Palo Alto City Council approved the Local Solar Plan, which sets a community -wide goal of meeting 4% of the City's energy needs through local solar by 2023 and identifies a number of strategies to help achieve that goal. These strategies include the development of several solar programs to encourage installation of roof -top solar such as existing incentives like the feed -in tariff program and the PV Partners solar rebate program. As of the end of 2017 all solar installations within the City generate 1.94% of the City's electricity from about 10 MW of installed local solar capacity. iii. Transportation Electrification Forecast To date, Palo Alto has observed residential EV adoption rates approximately three times greater than the California statewide average, and this residential adoption rate relative to statewide average projections is assumed to continue to 2030. To estimate the EV adoption rates of commuters into Palo Alto, the observed adoption rate from 2017 census data for the entire Bay Area was extended to 2030. In addition to the number of residential EVs shown in Table 4 above, there are projected to be approximately 3,100, 5,900, and 20,000 commuter EVs in 2017, 2020 and 2030, respectively. iv. Energy Storage Forecast This forecast is based on statewide projections for batteries and CPAU electricity rate structures. CPAU, in coordination with the Palo Alto Development Services Department, is facilitating the adoption of energy storage systems by customers by streamlining the process for permitting and interconnecting such systems. Detailed analysis in 2017 showed that batteries are currently not cost effective within CPAU's service territory or at our remote renewable generation sites and therefore Palo Alto currently does not provide any rebates for energy storage systems and is not currently planning to install storage at any of our renewable resources. In August 2017, the Palo Alto City Council adopted a resolution determining not to set a target for CPAU to procure energy storage systems at the wholesale level (or 17 Section III: Forecast Methodology for Energy and Peak Demand to establish a rebate program for behind -the -meter installations) due to a current lack of cost-effective applications for Palo Alto. The City plans to revisit the analysis by 2020.13 v. Demand Response Forecast CPAU has been running a voluntary summer demand response program for large commercial and industrial customers since 2013, with an average of 4-5 DR events per year resulting in 0.5-1 MW of peak load reduction. For the 2018 demand response program there are a total of 7 commercial customers enrolled, with 525 kW of projected peak load reduction. The EIRP Energy and Peak Demand forecasts are based on modest growth projections for the current voluntary large commercial demand response program. Somewhat more robust growth is expected after the implementation of Palo Alto's Advanced Metering Infrastructure (AMI) program in 2023. vi. Electrification of Space and Water Heating Forecast The Energy and Peak Demand forecasts use historical solar PV penetration rates as a proxy for adoption rates of heat -pump water heaters and space heaters. Based on this analysis, staff projects a natural gas load reduction of up to 1% from HPWH adoption, and an additional 1% load reduction from HPSH adoption, by 2030. vii. SB 338 Requirements On September 30, 2017, SB 338 was signed into law by Governor Brown, including additional provisions for the POU IRPs, which were effective January 1, 2018. This included revisions to Public Utilities Code section 9621(c), requiring the POU's governing board to "consider the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency, in helping to ensure each utility meets energy needs and reliability needs in hours to encompass the hour of peak demand of electricity, excluding demand met by variable renewable generation directly connected to a California balancing authority, as defined in Section 399.12, while reducing the need for new electricity generation resources and new transmission resources in achieving the state's energy goals at the least cost to ratepayers." The development of this IRP began well in advance of the effective date of these provisions. However, as part of the comprehensive process undertaken to develop this EIRP, the City reviewed and considered resource options that included all of the technologically feasible and cost-effective options available to it, including what options would be best utilized to meet energy needs and reliability requirements during hours of peak demand for the utility. This includes a review of the best available options considering both new and existing preferred resources, as would necessarily be assessed in order to ensure that Palo Alto provides its customers with the cleanest and most cost-effective generation resources, while also ensuring that the City meets all of the statutory requirements of not only Section 9621, but other procurement and resources mandates, as well. As previously mentioned, in November 2017 staff presented to the Palo Alto UAC an assessment of the future impact of distributed energy resources (Distributed Energy Resources Plan). This assessment 13 The analysis that led to the City Council's determination not to adopt a wholesale energy storage target can be found in this report to the Palo Alto UAC: https://www.cityofpaloalto.org/civicax/filebank/documents/57435. 18 Section Ill: Forecast Methodology for Energy and Peak Demand included guidelines for facilitating customer adoption as well forecasts of their potential to mitigate peak demand for CPAU. The aggressive forecasts and programs for solar PV, energy efficiency, and demand response have great potential to mitigate CPAU's peak demand. 19 Section IV: Existing Resource Portfolio IV. Existing Resource Portfolio The City's current electric supply portfolio comprises the following major types of resources: • Energy efficiency and distributed generation; • Federal hydro (Western contract); • Owned hydro (Calaveras); • Long-term, in -state, RPS-eligible power purchase agreements (PPAs), which include solar, wind, and landfill -gas resources; and • Market power purchases, matched with RECs, for monthly/hourly portfolio balancing. For calendar year 2020, the projected contribution of each of these five resource types to the City's overall electric supply portfolio is represented in Figure 5 below. Figure 5: Projected Palo Alto Electric Supply Mix in CY 2020 by Resource Type * Estimated Average Annual Unit Cost of 6 C/kWh * EE/Local Solar 4% 5 Solar PPAs (Expire 2040+) 30% Owned Hydro (Calaveras) 12% 2 Wind PPAs (Expire 2021, 2028) 9% Federal Hydro (Western) Expires 2024 36% 5 Landfill Gas PPAs (Expire 2026-2034) 9% 20 Section IV: Existing Resource Portfolio A. Energy Efficiency & Local Renewable Generation i. Energy Efficiency Palo Alto has long recognized cost-effective energy efficiency (EE) as the highest priority energy resource, given that EE typically displaces relatively expensive electricity generation and lowers energy bills for customers. Palo Alto places such emphasis on energy efficiency and demand side management programs that each year we prepare a detailed Demand Side Management Annual Report describing and reporting on efficiency savings from electricity, gas, and water. Highlights of Energy Efficiency Programs from 2017 • Multifamily Residence Plus+ Program - This program, which focuses on a hard -to -reach customer segment, was expanded in FY 2016 to include LED lighting measures, as the cost and quality of LED lighting had improved. In September 2016, the contract with the vendor was amended to add $500,000 to accommodate demand for the upgrades. As a result, the program saw an increase in savings of over 950%. • The Home Efficiency Genie Program - The Genie was launched in the summer of 2015 as a home efficiency assessment program. The licensed energy auditors still do house calls, but the program has expanded its focus to include more phone -based customer service on energy and water -related topics. The Genie now provides information not only about efficiency but also about the City's sustainability programs, such as heat pump water heaters (HPWHs) and the solar group -buy program (SunShares). Staff also changed the program guidelines to allow the Genie to discuss and advise residents on available rebates. • Heat -Pump Water Heater Pilot Program - The goal of this program is reduction of greenhouse gas (GHG) emissions through switching from natural gas appliances to high -efficiency electric appliances. Installation of heat pump water heaters (HPWHs) has been identified as a good starting candidate for a pilot program. The pilot program —launched in the spring of 2016 —was designed to facilitate the installation of HPWHs in single-family homes. In April 2017, the City hosted its first HPWH workshop to educate the community, including contractors, on the technology and installation of HPWHs. • Green Building Ordinance — The Green Building Ordinance (GBO) is Palo Alto's local building reach code that is more stringent than the state Title 24 standard. This ordinance applies to both residential and commercial buildings. CPAU previously assisted in the development of this code, but FY 2017 is the first year for which savings associated with the GBO have been reported in this report. • Building Operators Certification (BOC) Course - CPAU hosted a Building Operators Certification Course taught by Northwest Energy Efficiency Commission (NEEC) from Seattle. BOC is an eight - class certification course covering all aspects of building management and efficiency. Some 21 Section IV: Existing Resource Portfolio topics covered were: HVAC, electrical systems, comfort control and lighting. Upon passing an end -of -class exam, graduates could become Certified Building Operators (CBOs). • Residential Energy Assistance Program (REAP) - This program provides qualifying low-income residents with free energy efficiency measures and access to the Rate Assistance Program (RAP) rate discount. For qualifying customers, a Home Assessment, an application to the RAP, and an on -site customer evaluation for weatherization and energy efficiency measure installation, including insulation and lighting, is provided. Customers may have refrigerators and/or furnaces replaced if the need is found. ii. Local Renewable Generation Local renewable energy programs are critical to lowering emissions of local air pollutants and CPAU has enacted a number of initiatives and programs to facilitate customer adoption. In addition, in 2014 the Palo Alto City Council adopted the Local Solar Plan with the goal of having local solar photovoltaic facilities provide 4% of the City's total energy needs by 2023. The following is a description of Palo Alto's current customer -side renewable generation programs: • Solar PV Group -buy - Every year since 2015 Palo Alto has been an active partner in promoting the Bay Area SunShares PV Group -buy program which pre-screens solar installers and negotiates lower rates for customers. In both 2015 and 2017 Palo Alto was the top "Outreach Partner," both in terms of the number of solar contracts signed and the kilowatts of rooftop solar capacity that will be installed through the program. From 2015 to 2017 Palo Alto residents have signed 88 solar contracts through the SunShares PV Group -buy program for a total of 421 kW of installed rooftop solar capacity. • PV Partners - The PV Partners Program encourages photovoltaic or solar electric (PV) installations on Palo Alto homes and businesses by providing a rebate based on the capacity, measured in watts, of newly installed PV systems. The PV Partners Program continues to be one of the most successful in the State. Rebate funds were fully reserved in April 2016. The effect of the PV Partners program can be seen in the cumulative total of PV installations. As of June 30, 2017, there were 1,003 PV installations with the total capacity of 8.617 MW (5.04% of Palo Alto's system peak load). • Net -Energy Metering Successor Program - Prior to January 1, 2018 residential and commercial customers in Palo Alto who installed approved PV systems were able to sign up for the CPAU Net Energy Metering (NEM) program. CPAU reached the NEM cap of 10.8 MW in January 2018 and CPAU is now offering a NEM Successor Program instead. The NEM Successor process is integrated with the permitting process, and customers receive a credit for electricity exported to the grid based on CPAU's avoided costs. • Palo Alto CLEAN (Clean Local Energy Accessible Now) - This feed -in tariff program purchases electricity generated by renewable energy resources located in Palo Alto's service territory and interconnected on the utility -side of the electric meter. The electricity is purchased by Palo Alto for the electric renewable portfolio standard. The program was launched in 2012 and has been modified over the past few years. On February 3, 2014 the Palo Alto City Council approved a total program capacity of 3 MW at a price of 16.5 cents per kilowatt hour (kWh) fixed for 20 22 Section IV: Existing Resource Portfolio years. On May 8, 2017 the Palo Alto City Council approved minor changes to Palo Alto CLEAN. The program no longer has a total participation cap for either solar or non -solar eligible renewable energy resources. CPAU is currently offering to purchase the output of eligible renewable electric generation systems located in Palo Alto at the following prices: o For solar energy resources: 16.5 cents per kilowatt hour (C/kWh) for a 15-, 20- or 25 - year contract term until the subscribed capacity reaches 3 MW — after that the price will drop to 8.8 C/kWh for a 15 -year contract term, 8.9 C/kWh for a 20 -year contract term, or 9.1 C/kWh for a 25 -year contract term; and o For non -solar eligible renewable energy resources: 8.3 C/kWh for a 15 -year contract term, 8.4 C/kWh for a 20 -year contract term, or 8.5 C/kWh for a 25 -year contract term. There is no minimum or maximum project size, but the program is best suited for commercial property owners with available roof -tops or parking lots. Palo Alto's Public Works Department recently solicited proposals to install solar PV systems and electric vehicle chargers at four City - owned parking structures. All four of these parking garage solar PV systems are operational as of March 2018. As of August 2018, there are a total of six solar PV systems participating in the Palo Alto CLEAN program, including the four aforementioned systems on City -owned parking garages. These six projects account for 2.915 MW of the capacity available at the 16.5 C/kWh contract rate, with contract terms ranging from 15 to 25 -years; five of them projects are now operational, and the sixth is expected to be online by the end of 2018. B. Hydroelectric Resources i. Western Base Resource Since the 1960s, CPAU's participation as a power customer of the Central Valley Project (CVP) has been an instrumental factor in its ability to deliver low -carbon electricity to Palo Altans at low rates. The U.S. Bureau of Reclamation (BOR) built the CVP in the 1930s and is charged with the operation, maintenance, and stewardship of the project. The CVP was constructed primarily for flood control of the Sacramento Valley area; however, it is also used to provide water for irrigation and municipal use and for navigation and recreational purposes. Hydroelectric generation is a lower priority function of the CVP, relative to the aforementioned purposes. The BOR is legally required to first provide power to "Project Use" for operations and pumping water through the CVP project, and then to "First Preference Customers," those customers whose livelihood and/or property/land was impacted by the construction of the CVP. The remaining hydroelectricity ("Base Resource") is then made available for marketing under long-term contracts with not -for-profit entities such as municipal utilities and special districts. The Western Area Power Administration (WAPA) is the federal Power Marketing Agency charged with marketing and contracting with customers for the electric output associated with the CVP, and collecting funds to meet allocated revenue requirements on behalf of the BOR. In 2000, the City executed a new 20 -year contract with WAPA for CVP power deliveries starting in 2005. Under this contract the City receives 12.3% of all the Base Resource product output and is 23 Section IV: Existing Resource Portfolio obligated to pay 12.3% of all the CVP's revenue requirements as allocated to power customers, regardless of the amount of energy received. Under normal precipitation and hydrological conditions, this resource provides nearly 40% of CPAU's electricity needs. However, since 2005 the amount has varied from a low of 22% to a high of 64%. The corresponding cost per MWh has ranged from $22 to $61/MWh. The current Base Resource contract is set to expire at the end of 2024. Western's proposed 2025 Power Marketing Plan, submitted to the United States Federal Register Notification (U.S. FRN No 27433), if approved by the Department of Energy, would allow existing Base Resource power customers to renew up to 98% of their existing allocation for a thirty-year term (2025-2054) under similar contract terms and conditions to their existing contracts. The process for extending this contract is well underway and is expected to take five to seven years to complete (Western's 2025 Power Marketing Plan Tentative Schedule). CPAU staff has been actively involved in the process by providing informal and formal comments in response to the 2025 Western Power Marketing Plan and by working with WAPA staff and other Base Resource contract customers to develop a better model of long-term generation and cost projections. Pending approval of the 2025 Power Marketing Plan, Western will seek commitments through execution of the new Base Resource contract in 2020 — although participants are expected to have an option to reduce participation and/or terminate their contract in 2024. A key topic for consideration in the EIRP is whether or not the City should renew its Base Resource contract — and if so, at what level. The analysis necessary to aid Council in its decision will need to consider the cost and the value of the resource going forward, which are both highly uncertain. This is due in large part to the nature of the CVP and supply availability, which is dependent on unpredictable precipitation conditions, the long-term effects of climate change, and the potential for new environmental policies and/or projects which threaten to erode generation value. The costs associated with participating in the Base Resource are also highly uncertain. First, the BOR has yet to update the cost allocation study necessary to establish rates for CVP power under the existing contract, and it is unclear when such rates will be published for the post -2024 period. Additionally, funding requirements under the Central Valley Project Improvement Act (CVPIA)14 and the appropriateness of the allocation of Restoration Fund collections between water and power customers is of serious concern to CPAU and other power customers, who have been actively encouraging BOR and Congress to adjust this allocation. Lastly, the potential for changes to local and state RPS requirements — such as portfolio mandates or carve -outs for baseload renewables and/or not providing consideration for supply variability associated with large hydroelectric resources — as well as the potential for loss of load due to distributed energy resources or load defection, increase the risk of a renewed Base Resource contract becoming a 4 The Central Valley Project Improvement Act was passed by the U.S. Congress in 1992 to establish the Restoration Fund, funding requirements and goals to restore the habitat of the area impacted by the CVP. Water and power customers are obligated to pay into the Restoration Fund. https://www.usbr.gov/mp/cvpia/docs/public-law-102-575.pdf 24 Section IV: Existing Resource Portfolio stranded resource, unless clear and reasonable termination provisions are included in the new contract. NCPA staff and CPAU staff are in the process of assessing the impact magnitude and likelihood of several issues which threaten to dilute the future value of Base Resource, as well as NCPA's and CPAU's ability to influence these issues. These issues are in addition to highly variable hydrological and precipitation conditions which create year-to-year variations in value. Staff and NCPA will work towards refining the analysis of these risk factors, to aid in the decision of how much Base Resource to renew for the post -2024 period. ii. Calaveras Calaveras was bond -funded and built as a joint project between members15 of the Northern California Power Agency (NCPA) and the Calaveras County Water District (CCWD) in 1983. CCWD holds the Federal Energy Regulatory Commission (FERC) license and NCPA is the project operator. The project resides on the North Fork of the Stanislaus River in Calaveras, Alpine and Tuolumne Counties. Calaveras was built primarily for hydroelectric generation purposes and as such water is stored and managed to optimize generation value and to meet member owners' energy needs. Palo Alto's share in the project is 22.92%, which serves approximately 14% of the City's annual load in an average hydro year. Calaveras' project capacity is about 253 MW and can generate 575 gigawatt-hours (GWh) of energy annually under average hydroelectric conditions. Palo Alto's corresponding share of the output is 58 MW of capacity and 132 GWh of annual energy. As of January 2019, the City's outstanding debt on the project is approximately $89 million, of which a large portion will be maturing in 2024 and the remainder will mature in 2032. Annually through fiscal year 2024, the City's debt related to this project is on average about $9 million. For the remaining years until 2032, the debt is about $5 million. Historically, debt and other costs associated with Calaveras have resulted in the overall value of the project being below market.16 For FY 2018, Palo Alto's share of the project cost, including debt, is $12.5 million and the value is expected to be $5.7 million, resulting in a net cost of $6.8 million. However, because Calaveras' variable operating and maintenance costs are relatively low, the project is dispatched regularly for the purpose of generating energy. Additionally, Calaveras has the ability to meet several CAISO compliance and operating requirements, including: following variations in the City's load in real-time (load following), ancillary services related to regulation energy and spinning reserves; and meeting some of the City's Resource Adequacy is NCPA members participating in the Calaveras Project via the Calaveras Third Phase Agreement with NCPA include the cities of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Palo Alto, Roseville, Santa Clara, and Ukiah, and the Plumas- Sierra Rural Electric Cooperative. 16 In anticipation of Direct Access and the possibility for load to leave CPAU, in 1996 Council approved a competitive - transition -charge (CTC) to be added as a non -by -passable fee on all CPAU customers electricity bills. This was done to collect the above market cost (stranded cost) associated with Calaveras debt and the funds were held in the Calaveras Reserve, which had been established in 1983 to help defray cost associated with Calaveras. The Calaveras Reserve was repurposed in 2011 and is now the Electric Special Project Reserve (see Staff Report 2160). 25 Section IV: Existing Resource Portfolio requirements, including flexible capacity and system capacity. Calaveras also serves as an energy storage asset, since water is stored in the main reservoir, New Spicer Meadow, and released at optimal times to meet energy and capacity needs. Long-term it is expected that the value of Calaveras will increase, assuming average or above average hydroelectric conditions and favorable regulatory requirements. While there are no imminent decisions associated with Calaveras, a few issues may be worth evaluating in the context of the EIRP, including: 1. Assessment of Calaveras value and operating strategies, given the City's commitment to other large hydroelectric resources, RPS resources, and hydro risk management objectives; 2. How to best optimize Calaveras given its potential value to meet intermittent resource integration requirements; and 3. The value of the City's long-term stake in Calaveras, including the post -2032 period, when the current FERC license expires. C. Renewable Energy Resources 1. Wind PPAs Palo Alto currently has two long-term contracts for the output of wind power projects. Under separate contracts with Avangrid Renewables (formerly Iberdrola Renewables), the City receives a 25 MW share of the output of the Shiloh I project, and a 20 MW share of the output of the High Winds I project in Solano County, both of which are located in Solano County. The terms of these two contracts end in 2021 and 2028, respectively. Together, the two resources typically supply about 12% of Palo Alto's total electric supply needs. Both projects are considered fully deliverable, and are located in the Bay Area local reliability area. ii. Landfill Gas (LFG) PPAs Palo Alto currently has five long-term contracts with Ameresco for the output of landfill gas electricity projects. The five contracts include a 1.5 MW share of a project located in Watsonville, a 5.1 MW share of a project located in Half Moon Bay, a 1.9 MW share of a project located in Pittsburg, and the entire output of a 1.4 MW project located in Gonzales and a 4.1 MW project located in Linden. The terms of these agreements are all 20 years, with contract expiration dates between 2025 and 2034. Together, the five resources currently supply about 11% of Palo Alto's total electric supply needs. All five projects are also considered fully deliverable, with two of them located in the Bay Area local capacity area. iii. Solar PPAs Since the beginning of 2012, Palo Alto has executed six long-term contracts for utility -scale solar PV projects. These six contracts include three with sPower (the 26.7 MW Hayworth Solar project located in Bakersfield, and the 20 MW Western Antelope Blue Sky Ranch B project and the 40 MW Elevation Solar C project — both of which are located in Lancaster), two with Clenera (the 20 MW EE Kettleman Land project in Kettleman City and the 20 MW Frontier Solar project located in Newman), and one with Hecate Energy (the 26 MW Wilsona Solar project, which is slated to be built near Palmdale). The first five of these projects are currently operational, and they provide roughly 33% of Palo Alto's total electricity needs; meanwhile, the Wilsona project is scheduled to begin energy deliveries in mid -2021. The terms of these agreements are all at least 25 years, with contract expiration dates starting in 2040. 26 Section IV: Existing Resource Portfolio The three projects operated by sPower are considered fully deliverable, with the Hayworth project located in the Kern local capacity area, and the other two located in the Big Creek -Ventura local capacity area. D. Market Purchases & RECs Palo Alto has nine active Master Agreements (with BP Energy, Shell Energy North America, Powerex Corp, Cargill Power Markets, Exelon Generation, Iberdrola Renewables, NextEra Energy Power Marketing, Turlock Irrigation District, and PacifiCorp) to facilitate competitive forward market purchases and sales to meet Palo Alto's loads in the short- to medium -term. As of June 30, 2018, Palo Alto had outstanding electricity purchase commitments for the period July 2018 to June 2020 totaling 79 GWh, and sales commitments for this period totaling 161 GWh. These market based purchases and sales are made within the parameters of Palo Alto's Energy Risk Management Program. In FY 2018, gross market -based purchases (including both forward transactions and spot -market transactions) provided approximately 14% of Palo Alto's electricity needs, while gross market -based sales were equivalent to 23% of Palo Alto's needs (i.e., the City was a net seller of market -based energy). The volume of market purchases and sales however is highly dependent on hydro conditions and long-term commitments to renewable resource -based supplies. During normal hydro conditions, gross market purchases are expected to meet approximately 15% of energy needs, while gross market sales will amount to approximately 25% of energy needs. NCPA serves as Palo Alto's scheduling and billing agent for all transactions, and acts as the interface with the CAISO under a Metered Subsystem Aggregation Agreement (MSSA). Since 2013, Palo Alto has operated under a Carbon Neutral Plan for its electric supply portfolio, ensuring that all electrical generation that serves the City's needs produces zero GHG emissions on a net annual basis. To implement the Carbon Neutral Plan, in years when the City has been a net purchaser of market power (e.g., in very dry hydro years, or before the City's long-term solar contracts had started delivering power to Palo Alto), it has purchased Renewable Energy Certificates (RECs) in volumes equivalent to its net market power purchase volumes. E. COBUG In 2002, shortly after experiencing a series of rolling blackouts during the California energy crisis, the City decided to invest in a set of locally -sited natural gas -fired back-up generators in order to stave off such events in the future. These four generators, together known as the Cooperatively Owned Back -Up Generator (COBUG), total 5 MW in capacity but are seldom operated (generally only for maintenance purposes). They do, however, serve as an important source of local system reliability in the Bay Area local capacity area. F. California -Oregon Transmission Project (COTP) Fourteen Northern California cities and districts and one rural electric cooperative, including Palo Alto, are members or associate members of a California joint powers agency known as the Transmission Agency of Northern California (TANC). TANC, together with the City of Redding, WAPA, two California water districts, and Pacific Gas and Electric (PG&E) own the California -Oregon Transmission Project (COTP), a 339 -mile long, 1,600 MW, 500 kV transmission power project between Southern Oregon and 27 Section IV: Existing Resource Portfolio Central California. Palo Alto is entitled to 4.0% of TANC's share of COTP transfer capability (50 MW). As a result of low utilization of the transmission capacity and therefore low value relative to costs (in addition to a focus on acquiring in -state renewable resources), in August 2008 Palo Alto effected a long-term assignment of its full share and obligations in COTP to the Sacramento Municipal Utility District (SMUD), Turlock Irrigation District (TID), and Modesto Irrigation District (MID). The long-term assignment is for 15 years (through 2023), with an option to extend the assignment for an additional five years. G. Resource Adequacy Capacity As described above, the majority of Palo Alto's long-term generation contracts (and its one owned thermal generating asset) are deemed fully deliverable and provide the City with Resource Adequacy (RA) capacity to satisfy its CAISO regulatory requirements. The amounts of RA capacity provided by each resource are detailed in the CRAT standardized table in the appendices of this report, and a high- level overview is provided in Table 6 below. Table 6: Palo Alto's Resource Adequacy Capacity Portfolio ro e Resource Type Hydroelectric Local Area CAISO System Flexible RA? No Average NQC (MW) 147.0 Western Base Resource Calaveras Hydroelectric CAISO System Yes 58.0 High Winds Wind Bay Area No 4.5 Shiloh I Wind Bay Area No 5.7 Santa Cruz LFG Landfill Gas CAISO System No 1.5 Ox Mountain LFG Landfill Gas Bay Area No 5.1 Keller Canyon LFG Landfill Gas Bay Area No 1.9 Johnson Canyon LFG Landfill Gas CAISO System No 1.4 San Joaquin LFG Landfill Gas CAISO System No 4.1 Hayworth Solar Solar PV Kern No 14.2 Elevation Solar C Solar PV Big Creek -Ventura No 21.9 Western Antelope Solar PV Big Creek -Ventura No 11.0 COBUG Natural Gas Bay Area No 4.5 28 Section V: Future Procurement Needs and Portfolio Rebalancing V. Future Procurement Needs and Portfolio Rebalancing A. Needs Assessment: Energy, RPS, Resource Adequacy Capacity Overall, Palo Alto's resource portfolio has a surplus of energy, and a surplus of RPS generation (relative to its RPS procurement requirements under SB 350), as detailed in the Standardized Tables presented in Appendix D. Figure 6 below depicts the City's projected supplies17 of eligible renewable generation for the period 2003 to 2038, as well as the City's annual RPS generation procurement requirements under SB 350, based on its actual and forecasted retail sales volumes. Note that this figure presents only currently contracted resources; no additional resources are assumed to be procured, and no existing contracts are assumed to be extended. Figure 6: Palo Alto's RPS Generation Projections and RPS Compliance Requirements 600 L 500 (1) C7 400 1) Q n >, 300 oA a) W a) ro ▪ 200 a) cc 100 0 IE Large Solar (Development) • Large Solar (Operating) ❑ PA CLEAN IN Landfill Gas ® Wind ❑ Small Hydro SB 350 RPS Requirements LO "1, 10 LO ,ti0 "1, LO "1, LO .LO .LO ti0 ti0 LO LO 0 LO 0 In terms of capacity, the City has a surplus of system RA capacity, but deficit positions in local and flexible RA capacity.18 The City makes up these deficits each year via bilateral RA capacity purchases. One of the challenges that CPAU faces over the IRP planning period is ensuring that it can continue to 17 Note that renewable energy supplies shown in Figure xx which are surplus to the City's RPS procurement requirements may ultimately be sold or banked for use in future compliance periods. 18 For additional details on Palo Alto's projected needs and supplies of electrical generation, RPS generation, and RA capacity, please see the EBT, RPT, and CRAT standardized tables in Appendix D to this report. 29 Section V: Future Procurement Needs and Portfolio Rebalancing procure adequate supplies of local and flexible RA capacity — both to satisfy its regulatory compliance obligations, and to ensure the overall reliability of the CAISO bulk transmission system.19 However, during the IRP planning period, CPAU staff's primary focus will be on determining whether to renew its Western Base Resource contract for a new 30 -year term starting in 2025 — and if so, at what capacity share. As such, staff will be heavily focused on negotiating contract terms that provide the City with protection and flexibility, while also closely monitoring the many issues that are currently creating uncertainty around this resource's long-term costs and generation levels. The remainder of this section of the EIRP will focus on exactly this question: whether to renew the Western Base Resource contract at the maximum possible level, or whether to "rebalance" the City's electric supply portfolio by scaling back (or eliminating) the City's Base Resource allocation and replacing it with a different generation resource. B. Portfolio Rebalancing Analysis As noted in the September 2017 report to the Palo Alto UAC, CPAU staff evaluated a very large number of potential new supply-side and demand -side resources in the portfolio analysis it performed related to the Western Base Resource contract renewal decision. However, as the analysis progressed, due to reasons of feasibility/availability and cost/uncertainty, staff narrowed the focus of the analysis to the following resources: • A renewed Western Base Resource (Western) contract, • In -state solar, • Out-of-state wind, • Geothermal, • Local (Palo Alto) solar, and • Market power purchases matched with renewable energy certificates (RECs). The Western hydro resource and in -state solar resource characteristics are well understood, given the large role they each play in Palo Alto's current resource portfolio. Western is a relatively low-cost, flexible resource — at least in average years — but it features a large amount of seasonal variability, as well as year-to-year uncertainty around its cost and level of output. In addition, there are several major issues currently pending that have the potential to significantly impact the cost and/or operation of the resource.20 Solar also involves a great deal of seasonal variability and contributes towards the seasonal 19 Also, if Palo Alto opts not to renew its Western Base Resource contract in 2025 — or significantly scales back its share of this resource — then the City will face the additional challenge of ensuring it has adequate system RA capacity to meet its planning reserve margin requirements. As Table 6 indicates, the Western Base Resource contract is by far the City's largest source of system RA capacity. 2° For example: The State Water Resources Control Board has several proceedings underway that may have very significant impacts on Western operations, including the consideration of an "unimpaired flow" criteria as part of its Bay Delta Plan that could result in significantly less generation from Western, particularly in the summer months. There are also long-term risks associated with an increase in "Aid to Irrigation" payments that Power customers may be required to make to Water customers, litigation related to the Central Valley Project Improvement Act (CVPIA) Restoration Fund payments that Power customers make, potential cost impacts to Power customers related to the "Twin Tunnels" project, and the impacts of climate change on the resource. Staff hopes that many of these uncertainties will be better understood by 2024; however it is likely that a number of them will remain unresolved. These risks must be more closely examined before making a final contract commitment in 2024. 30 Section V: Future Procurement Needs and Portfolio Rebalancing imbalance of the supply portfolio, but with far less uncertainty around its cost or annual output amount. And while its costs have decreased dramatically in recent years, the huge volume of recent capacity additions — which have been concentrated in areas with the best solar potential — have driven down the market value of this energy at least as much, leading to a sharp increase in negative market prices and curtailments. The rise of solar generation in the state has also led to the Duck Curve phenomenon21, which has in turn resulted in new regulatory requirements for each load -serving entity (LSE) to procure sufficient flexible generation capacity to maintain transmission grid reliability. Out-of-state wind resources — e.g., from the Pacific Northwest or New Mexico — have also become very low-cost in recent years, in some cases even lower priced than solar.22 Wind resources from these areas typically have a generation profile that is a good fit for the City's portfolio, producing somewhat more energy in the fall and winter months than in the spring and summer months. However, the cost of obtaining transmission access for them into the state significantly raises their total cost.23 Geothermal resources have also experienced a price decline in recent years, although they are still less valuable compared with solar or out-of-state wind. New binary cycle geothermal technology also produces no GHG emissions and can be more flexibly dispatched compared to prior generations of geothermal technologies. This technology bears further consideration in the coming years as the City considers options to rebalance the portfolio. Local solar is the only local supply resource considered in the portfolio analysis. While it would have a higher value than solar located in the central San Joaquin Valley24 it is unlikely to be available in sufficient quantities to make a significant contribution to the City's overall electric supply needs. The cost of such local systems would also be relatively high. For example, under the Palo Alto CLEAN program, even with a contract price of 16.5 cents/kWh, the program existed for several years before finally securing about 3 MW of participating capacity within the last two years. And the cost of solar energy from a 500 kW project at the Palo Alto golf course was estimated at 10 to 14 cents/kWh in 21 The Duck Curve refers to the graph shown in Figure 1, illustrating the impact of the increasing adoption of solar PV on CAISO's net load (i.e., total load less generation from variable energy resources like wind and solar). Over time, as more solar generation came online, the CAISO net load curve went from having a slight mid -day peak to having a deep mid -day trough, bracketed by a steep downward ramp in the morning, as solar plants begins generating, and an even steeper upward ramp in the evening, as solar generation trails off with the sunset. For more information, see: https://www.caiso.com/documents/flexibleresourceshelprenewables fastfacts.pdf. 22 Staff has received numerous proposals for out-of-state wind resources over the past several years, but such resources were found to be uneconomical compared to in -state solar when Palo Alto made long-term commitments for solar resources between 2012 and 2016. 23 The availability of transmission pathways to bring this generation into CAISO on a reliable basis is also not assured. However, for Pacific Northwest wind resources, the City's allocation of capacity on the California -Oregon Transmission Project (COTP) could prove very useful. The City laid off this transmission capacity for a 15 -year period, but this layoff will end at the end of 2023. 24 Local solar is currently at least 3 C/kWh more valuable than remote solar, given that it would provide enhanced local resiliency, would not be subject to transmission charges, would reduce the City's resource adequacy capacity requirements, and would have a high locational value, due to its mitigating effect on Bay Area transmission congestion. 31 Section V: Future Procurement Needs and Portfolio Rebalancing 2017, which is more costly compared to other resource options, even with the greater value (primarily due to avoided transmission charges) inherent in local generation. Finally, market energy purchases combined with unbundled RECs could present an attractive option in the short-term if the City wishes to reduce its Western contract allocation and seek a different low-cost solution. In the long-term, however, many forecasts indicate that as the state's GHG reduction requirements ratchet up, the cost of carbon allowances will likewise climb, which in turn would raise market power prices and make this option uneconomic. In addition, this approach would perpetuate the City's reliance on traditional GHG-emitting generators. On the other hand, shorter -term market purchases would provide the City with a great deal of flexibility in terms of contract duration and volume, and lower the risk of stranded energy resources if the electric loads available to be served by the City decline significantly. Table 7 below summarizes the various resource types that staff considered most closely in its portfolio analysis and their relative merits. The key indicators used for comparing the different portfolio options are: • Value: The net value of a resource; the projected revenue from selling the resource's energy into the CAISO market less the resource's bi-lateral contract cost; • Portfolio Fit: Lower reliance on the grid for hourly load balancing; • Diversification: Geographic and resource diversity; • Term Flexibility: Flexibility in length of contract and termination provisions; and • Cost Certainty: Degree of certainty of future resource costs. Table 7: Relative Merits of Candidate Resources Considered to Rebalance Supply Portfolio * Ratings reflect relative changes from current portfolio of resources * Post -2024 Resource Options Federal Hydro (WAPA) Out -of -State Wind In -State Solar Baseload Renewable Local Solar Market Purchases & RECs Value Portfolio Fit Diversification Term Flexibility Cost Certainty 4 4 e 4 t J ED l 4 ED ED 4 4 4 • • ED 4 • • • Legend: High 4 Medium 4 Low •IEE!ED 32 Section V: Future Procurement Needs and Portfolio Rebalancing i. Portfolio Expected Net Value First, as far as the net value of a resource contract for the 2025 to 2030 period, Western has the potential to be a relatively valuable resource, but also has the most uncertainty when it comes to costs, for the reasons described above. The expected net value of Western and several potential new contracts, as determined by a scenario -based spreadsheet analysis, is shown in Figure 7. The net value of each resource is calculated based on its energy values (from each resource's LMP forecast), along with the ancillary services value provided by Western, the value of the RECs generated by the renewable resources, and each resource's RA capacity. Note that the expected net value of some resources is negative (less valuable than projected market value), due to the fact that the cost of all of the renewable resources includes the cost of renewable attributes in addition to energy, and because a primary goal of a long-term agreement such as a PPA is to hedge and manage exposure to future price volatility. Figure 7: Expected Net Value of New Resources and Western Relative to Market Value * Very High Cost Uncertainty around Western * $40 - Average Annual Resource Net Value ($/MWh) $30 - $20 $10 -$10 -$20 -$30 -$40 - -4—Western - Average Year New In -State Wind --New In -State Solar thew Out -of -State Wind New Geothermal One of the primary messages of Figure 7 is that there is a tremendous amount of uncertainty around the net value of Western, as indicated by the large uncertainty bars featured on that data series.25 It should be noted that the uncertainty shown in Figure 7 is based on staff's best estimate of the 25 Figure C-6 does not include market price uncertainty or hydrological uncertainty; the uncertainty range shown for Western represents purely regulatory and litigation -related cost uncertainty. 33 Section V: Future Procurement Needs and Portfolio Rebalancing potential range of future Western contract costs. It should also be noted that this uncertainty is heavily biased toward the negative direction: there is limited "upside" uncertainty while there is a great deal of "downside" uncertainty, largely related to pending environmental regulatory issues. ii. portfolio Fit Another key indicator is hourly portfolio fit, which will determine how reliant the portfolio is on grid power (and, as a result, how exposed it is to market prices). Figure 8 displays average hourly generation profiles for each month (one average day per month is shown) for Western and other potential new resources relative to the City's average load. Although total resource supplies from long- term contracts exceed the City's load in the spring and summer months, the opposite is true during the fall and winter months. Thus Figure 8 indicates that out-of-state wind, which produces more energy in the fall and winter months, would be a good complement to the City's existing portfolio. In -state wind (in the Solano hills) and solar, on the other hand, exacerbate the City's portfolio fit problem, as they produce more energy in the spring and summer months. Figure 8: Average Hourly Load and Generation Profiles for Each Month for Western and Potential New Resources (Normalized to Average Hourly Load) * New Mexico Wind Resource Profile Complements Palo Alto Portfolio * Average Daily Load and Generation Profiles for Each Month 1.4 1.2 1.0 - 0.8 0.6 - 0.4 - M J J A Month S N D Load ---Western (2025 Max Share) —50 MW Solar (Central Valley) X50 MW Wind (Solano Hills) X50 MW Wind (New Mexico) —20 MW Geothermal 34 Section V: Future Procurement Needs and Portfolio Rebalancing iii. Portfolio Cost Uncertainty and Management The cost uncertainty of the electric supply portfolio in the short-term is primarily driven by the water available for hydroelectric production, and is estimated at $10 to $15 million per year at prevailing market prices. Palo Alto is well positioned to manage this cost uncertainty through its hydro rate adjustment mechanism26 and by maintaining sufficient cash reserves. The cost uncertainty related to seasonally balancing the portfolio27 is minimal since market price variability between seasons is highly correlated and because staff executes seasonal buy -sell transactions at the same time. As noted above, in the long-term, there are a number of issues that could dramatically affect the value of the Western resource in the coming years. As such, a large focus of staff efforts in the next five years will be to better understand the long-term economics of the Western resource and mitigate the risks associated with it through flexible contractual terms. There are also proceedings underway to investigate market restructuring to deal with issues related to the integration of variable renewable resources, such as over -generation, very steep evening ramp periods, and the appropriate valuation of dispatchable generation capacity. Volatility in market prices, as the CAISO and the CEC determine how to send price signals to ensure a reliable grid, could leave a seasonally unbalanced portfolio such as the City's current portfolio exposed. Increases in transmission charges could also make remote resources compare less favorably to local resources and demand -side management in the future. 26 For additional detail on the hydro rate adjustment mechanism, please see Staff Report ID 8962 (March 2018): https://www.cityofpaloalto.org/civicax/filebank/documents/63851. 27 Revenues received from the sale of surplus energy during the spring and summer periods are utilized to purchase electricity needs for the fall and winter periods. 35 Section IV: Supply Costs & Retail Rates VI. Supply Costs & Retail Rates Critical to the success of an IRP, in addition to ensuring that the adopted plan leads to compliance with all regulatory requirements, is ensuring that it also results in supply cost minimization and (ideally) low and stable customer retail rates. As described in the FY 2019 Electric Utility Financial Plan and Rate Proposal to the Palo Alto City Council, CPAU staff projects supply costs to rise substantially for the next several years, largely driven by increases in transmission costs and new renewable energy projects coming online. Retail rates are also projected to rise due to substantial additional capital investment in the electric distribution system, and operational cost increases. In order to ensure adequate revenue recovery, the Palo Alto City Council recently approved a 6% retail rate increase for FY 2019 (taking effect July 1, 2018), and adopted a Financial Plan that calls for an additional 3% rate increase for FY 2020 with 0-2% annual rate increases projected thereafter. However, it should be noted that the City's current electric rates are far lower than the statewide average electric retail rates, and, under the recommended portfolio presented in Section X of this report, staff projects that they will remain so. In fact, even under the worst -case scenarios staff evaluated the recommended portfolio against, as described in Section X.0 of this report, the City's retail electric rates remain lower than the projected statewide average rates. 36 Section VII: Transmission & Distribution Systems VII. Transmission & Distribution Systems A. Transmission System At the transmission level, CPAU staff has two main focuses during the EIRP planning period: (1) determining the optimal utilization of the COTP asset when Palo Alto's long-term layoff of this resource ends on January 1, 2024, as discussed above in the Existing Resource Portfolio section; and (2) pursuing an additional interconnection point with PG&E's transmission system. The new interconnection point with PG&E is being sought in order to provide redundancy, and therefore increased local reliability, in the event that an outage affects the three current interconnection lines — as happened in February 2010.28 To minimize the possibility of a City-wide outage caused by an interconnection line outage, it is in the City's interest to find a physically diverse connection to the PG&E transmission system for power supply to the City. Staff has been investigating options for an alternative connection to the transmission grid for numerous years.29 B. Distribution System Palo Alto's electric distribution system is directly interconnected with the transmission system of Pacific Gas and Electric Company (PG&E) by three 115 kV lines, which have a delivery point at Palo Alto's Colorado substation. Palo Alto's distribution system consists of the 115 kV to 60 kV delivery point, two 60 kV switching stations, nine distribution substations, approximately 12 miles of 60 kV sub transmission lines, and approximately 469 miles of 12 kV and 4kV distribution lines — including 223 miles of overhead lines and 245 miles of underground lines. In 2018 CPAU staff completed a distribution system assessment report to begin the process of understanding the distribution system upgrades that will be required to integrate increasing penetration levels of distributed energy resources, particularly electric vehicles. Staff's conclusion from this assessment was that at the system level, there is sufficient capacity to accommodate DER growth for the next five years. However, there are some subcomponents of the system that require further assessment and monitoring (e.g. residential distribution transformers). The City-wide implementation of Advanced Metering Infrastructure (AMI), which is planned to occur by 2022, will greatly enhance the visibility into distribution system operational characteristics and further enable the integration of DERs by offering new customer programs (such as, time varying rates). Palo Alto's current five-year capital plan for electric distribution facilities contemplates spending approximately $16.5 million per year over this five-year period, primarily to fund infrastructure replacement and new customer connections. 28 Although three lines would normally provide redundancy and back-up power delivery to the City, all three lines run in a common corridor on the bay side of the City, a corridor that is in close proximity to the Palo Alto Airport. The common corridor and proximity to an airport means that the City's power supply is susceptible to single events that can affect all three lines, as happened in February of 2010 when a small aircraft hit the power lines resulting in a city-wide power outage for over 10 hours. 29 See this January 2016 staff report for additional background on the efforts to secure an additional transmission interconnection point: https://www.cityofpaloalto.org/civicax/filebank/documents/50608. 37 Section VIII: Low-income Assistance Programs VIII. Low-income Assistance Programs CPAU has three programs to provide financial assistance to low-income customers: • Residential Energy Assistance Program (REAP): This program provides qualifying low-income residents with free energy efficiency measures and access to the Rate Assistance Program (RAP) rate discount. For qualifying customers, a Home Assessment, an application to the RAP, and an on -site customer evaluation for weatherization and energy efficiency measure installation, including insulation and lighting, is provided. Customers may have refrigerators and/or furnaces replaced if the need is found. • Rate Assistance Program (RAP): This program provides a 25% discount for electric and gas charges for qualified customers. Applicants can qualify based on medical or financial need. • ProjectPLEDGE: This program provides a one-time contribution of up to $750 applied to the utilities bill of qualifying residential customers. Eligibility criteria include experiencing recent employment and/or health emergency events. Administered by CPAU, this program is funded by voluntary customer contributions. 38 Section IX: Localized Air Pollutants IX. Localized Air Pollutants A. Electric Vehicle Programs Given that Palo Alto's electricity supply is derived entirely from clean, carbon neutral generation resources, the most important thing that the City can do at this point to improve local air quality is to reduce the combustion of fossil fuels in the transportation sector — primarily through electrification of vehicles. The City of Palo Alto Utilities has a number of programs to promote the adoption of electric vehicles, a summary of which can be found in the 2017 Demand Side Management Annual Report. Two of the current programs are listed below. EV Charger Rebate Program - In early 2017 CPAU launched an EV Charger Rebate program using funds from monetizing Low Carbon Fuel Standard (LCFS) credits. Rebates are targeted towards multifamily and mixed -use properties, schools and non -profits. Along with the launch, new online resources were created, including the EV calculator tool. Online EV/PV Calculator - CPAU launched an online calculator tool for residents to evaluate the costs and benefits of installing rooftop solar. In addition, residents can now evaluate different electric vehicles and see the financial impacts and environmental benefits of charging vehicles using Palo Alto's carbon neutral electricity. The online calculator uses satellite imagery of Palo Alto homes as well as current CPAU electricity rates to produce rooftop solar system designs and cost estimates tailored to Palo Alto. B. Local Renewable Energy Programs In addition to the local renewable electricity generation programs previously mentioned, Palo Alto also has a Solar Hot Water Program which can replace natural gas combustion and thereby improve local air quality. Solar Hot Water Program - Palo Alto launched the solar water heating (SWH) program in May 2008, in advance of a State law requiring natural gas utilities to offer incentives. This program offers rebates of up to $2,719 for residential systems and up to $100,000 for commercial and industrial systems. A sample of these installations is inspected for quality and program compliance by an independent contractor. The program was recently extended through 2020. A total of 60 systems have been installed as of June 30, 2017; 54 of these are residential. From 2008 to 2017 $337,911.37 in rebates were disbursed. In the fiscal year 2017 this program resulted in annual energy savings of 19,826 therms and 13,387 kWh. C. Electrification of Space and Water Heating Programs The Electrification Work Plan highlighted the potential of lowering carbon emissions and improving local air quality by electrification of building water and space heating loads thereby removing local combustion of natural gas. A description of more programs to promote electrification of space and water heating can be found in the 2017 Demand Side Management Report. Two of the current electrification programs are listed below. 39 Section IX: Localized Air Pollutants Heat Pump Water Heater Pilot Program - The goal of this program is reduction of greenhouse gas (GHG) emissions through switching from natural gas appliances to high -efficiency electric appliances. Installation of heat pump water heaters (HPWHs) has been identified as a good starting candidate for a pilot program. The pilot program —launched in the spring of 2016 —was designed to facilitate the installation of HPWHs in single-family homes. In April 2017, the City hosted its first HPWH workshop to educate the community, including contractors, on the technology and installation of HPWHs. Multifamily Gas Furnace Retrofit Pilot Program - CPAU has been awarded a 2018 Climate Protection Grant Program from the Bay Area Air Quality Management District (BAAQMD) for a Multifamily Gas Furnace Pilot Program. The grant period is two years from 2019-2020. The Multifamily Gas Furnace Retrofit Pilot targets apartment buildings to replace existing in -unit gas wall furnaces with high efficiency air source heat pumps. Heat pump systems are far more energy efficient than gas furnaces, eliminate GHG emissions associated with gas -fired space heaters, while improving air quality within the dwelling units. However, many questions still exist regarding cost- effectiveness, building electrical capacity and other technological and logistical hurdles for replacing gas furnace to heat pump systems in multifamily buildings. This pilot will identify the technical and logistical hurdles as well as potential solutions, and will document the retrofit cost, energy savings, avoided GHG emissions as well as other indoor air pollutants from the gas furnace. D. Refrigerant Recycling Program Ensuring that refrigerants are properly disposed of also improves local air quality. CPAU has also been awarded a 2018 Climate Protection Grant Program from the BAAQMD for a Refrigerator Recycling Program. The grant period is two years from 2019-2020. Although the City's GreenWaste contractor can pick up and remove old refrigerators from customer houses, they are not certified to recycle the foams and refrigerant chemicals to the level that the US EPA Responsible Appliance Disposal (RAD) program requires. RAD requirements go above and beyond the State of California minimum recycling requirements. This BAAQMD grant will to cover a portion of the cost of recycling in order to enable us to both claim EE savings as well as meet the RAD standards in a cost-effective manner. 40 Section X: Path Forward & Next Steps X. Path Forward & Next Steps A. Recommended Portfolio Because almost six years remain before Palo Alto must make its major planning decision of the EIRP planning period (the Western contract renewal decision), it is difficult to definitively identify a single recommended portfolio at this time. The base case in this IRP assumes that Palo Alto will renew the Western contract at the maximum allocation level. However, given the substantial amount of uncertainty related to the cost and output levels of this resource (as described in the Future Procurement Needs and Portfolio Rebalancing section of this report), staff is actively reviewing attractive alternatives which could replace the entire Western contract when it expires in 2024. If, in fact, Palo Alto determines that the costs associated with a renewed Western contract are too high, or too uncertain, CPAU staff would immediately begin working to replace this resource (which currently supplies nearly 40% of the City's electric load) with a different carbon neutral supply resource. As such, the City would continue on its path to meeting or exceeding both the state's RPS procurement requirements and GHG emission reduction targets. Figure 9 below depicts Palo Alto's projected electric resource supply mix in 2030 where a large portion of this mix currently consists of undetermined carbon -neutral resources. Given the City's current policies and the state's RPS and GHG emissions mandates, staff can confidently say that these resources will either be hydroelectric or renewable. Figure 9: Palo Alto's Projected Resource Supply Mix in 2030 Landfill Gas 4% Undetermined Carbon -Neutral Resources 42% 41 Section X: Path Forward & Next Steps B. GHG Emissions CARB's 2017 Scoping Plan identified GHG emissions targets for the entire state, as well as individual economic sectors, including the electricity industry. The Scoping Plan established an overall electric sector GHG target for 2030 of 30 to 53 million metric tonnes (MMT) of CO2e, of which Palo Alto's pro rata share (based on load) is 0.174%, or 52,049 to 92,103 MT CO2e. As Figure 10 indicates, given its electric supply portfolio consisting entirely of carbon -free resources (hydroelectric, wind, solar, and biogas), Palo Alto is on track to emit far less than even the most aggressive end of the target range identified in the CARB Scoping Plan. Figure 10: CPAU Electric Supply GHG Emissions (2005-2030) Electric Supply Emissions (MT CO2e) 200,000 180,000 - 160,000 - 140,000 120,000 100,000 80,000 - 60,000 40,000 - 20,000 - 0 -o-•0 Historic Actuals Projected O b 1 1 1 1 1 1 1 1 © Actual Emissions •'— Average Hydro Emissions Scoping Plan Target Range 1- 00 m o -, O O O 0 0 0 0 N N N N N N N N M .-1 0 0 N o O 0 0 0 IOH0 Lh tD n 00 01 0 N N m V to lb r-1 N .-1 e-1 N N N N N N N IN N 0 0 0 0 0 0 0 0 0 0 0 0 0 N N N N N N N N N N N N N o,0 0 N 00 0'1 0 O O 0 0 N N N N C. Scenario Analysis As described in Section II.D of this report, an important element of integrated resource planning is to put the recommended portfolio through scenario and risk analysis, to assess its performance under a range of potential conditions. Staff has performed such a scenario analysis around the recommended portfolio presented in this report, evaluating its performance while varying the following factors: market prices, hydrological conditions, environmental regulations affecting hydro resource operations, DER adoption rates, and natural customer load growth rates. Under all cases examined, however, the City's supply portfolio remained in compliance with the RPS and GHG emissions targets set forth in SB 350, all while keeping Palo Alto customers' retail rates lower than the statewide average retail rates. 42 Section X: Path Forward & Next Steps D. Next Steps As there is so much uncertainty regarding the Western resource, and because the decision is such a consequential one, it merits a follow-up analysis closer to the contract renewal date, which is currently scheduled for mid -2020. Even after that, WAPA's 2025 Power Marketing Plan indicates that the City will have until July 2024 to make a decision to reduce or reject its allocated share of the future Western contract, which is expected to be approximately as large as its current share. The additional analysis regarding this decision should include: 1. An examination of the City's net load forecast and associated uncertainties, in line with the Draft DER Plan discussed with the UAC in November 2017, with particular emphasis on how it may be affected by customer adoption of DERs (EVs, Demand Response, Energy Efficiency, Solar PV, storage, and building electrification) in order to avoid stranding assets. 2. An update and extension of CPAU's supply portfolio analysis, including updates to the hourly LMP forecasts and the costs, assumptions, and uncertainties associated with all resource options. 3. Analysis of the projected costs, output, and flexibility of the renewed Western contract, to reduce the amount of outstanding uncertainty around this resource. 4. Advocating for flexible contractual provisions in the new Western contract, and examining the legal and economic merits and risks associated with committing to the Western resource for 30 more years. Aside from the Western contract decision, staff will be actively following state regulators' activities related to electric supply portfolio GHG emissions accounting and allocation of statewide GHG emissions reduction targets. While the City's current GHG emissions accounting methodology (adopted by the City Council in 2013 with the Carbon Neutral Plan) for electric supplies is based on a net annual accounting of the City's market power purchases (which are assumed to have the statewide average GHG emissions intensity), staff is aware that state regulators are evaluating alternative GHG emissions accounting methodologies, including various types of hourly accounting approaches. And of course, staff will continue its activities in pursuit of lowering the overall cost to serve customer loads. These include continuing to optimize the use of the City's Calaveras resource, evaluating the benefits of the NCPA pool, and/or the procurement of alternative scheduling services for its renewable resources. E. Key Issues to Monitor & Attempt to Influence In the course of developing this EIRP, CPAU staff has identified a number of important issues and sources of uncertainty to closely monitor and attempt to positively influence over the course of the planning period. Some of the primary issues and uncertainties that staff will be focused on include: • Cost and operations of Western hydroelectric resource: environmental restoration cost, water delivery timing and priorities, Western transmission upgrade needs, environmental regulations affecting water releases, and long-term climate change • Frequency and magnitude of economic curtailment of solar PV resources • Renewing the FERC license of the Calaveras hydroelectric project 43 Section X: Path Forward & Next Steps • Seasonal variation in CAISO energy market prices, given the overall generation profile of CPAU's resource portfolio • Changes in overall energy market price and changes in carbon allowance prices associated with State's cap -and -trade program • Increased market prices related to load -following capacity and ancillary services • Customer load profiles change and loss of customer loads available for the City to serve • New legislative and regulatory mandates 44 Section XI: Appendices XI. Appendices A. Key Supplemental Reports and Documents 1. NCPA-CAISO Metered Sub -System Agreement 2. Ten -Year Electric Energy Efficiency Goals (2017) 3. Energy Storage Assessment Report (2017) 4. Proposed Distributed Energy Resources Plan (2017) 5. Distribution System Assessment Report (2018) 6. Demand Side Management Annual Report (2018) Section XI: Appendices B. RPS Procurement Plan CITY OF PALO ALTO UTILITIES CITY OF PALO ALTO'S RENEWABLE PORTFOLIO STANDARD PROCUREMENT PLAN Version 3 December 2018 REVISION HISTORY Version Date Resolution Description 3 12/3/18 Updated to reflect Senate Bill 350 (2015) requirements 2 11/12/13 9381 Updated to reflect adoption of final CEC regulations, effective 10/1/13, permitting the City to adopt rules for Excess Procurement, Compliance Delay, Cost Limitations, Portfolio Balancing Reductions, and Historic Carryover. Other non -substantive clean up. 1 12/12/11 9215 Original version per Senate Bill X1 2 (2011) requirements XI -2 Section XI: Appendices TABLE OF CONTENTS INTRODUCTION XI -4 A. PURPOSE OF THE PLAN (PUC § 399.30(A)) XI -4 B. PLAN ELEMENTS XI -5 1. Compliance Period Definitions XI -5 2. Procurement Requirements XI -5 3. Portfolio Content Categories (PCC) XI -6 4. Portfolio Balancing Requirements XI -6 5. Long -Term Contract Requirement XI -7 6. Reasonable Progress XI -7 C. OPTIONAL COMPLIANCE MEASURES XI -7 1. Excess Procurement (PUC §399.13(a)(4)(B)) XI -7 2. Delay of Timely Compliance (§ 399.30(d)(2), § 399.15(b)(5)) XI -8 3. Cost Limitations for Expenditures (PUC § 399.30(d), § 399.15(c)) XI -10 4. Portfolio Balance Requirement Reduction (PUC § 399.16(e)) XI -11 5. Historic Carryover XI -11 6. Large Hydro Exemption (PUC § 399.30(1)) XI -13 D. ADDITIONAL PLAN COMPONENTS XI -14 1. Exclusive Control (PUC § 399.30(n)) XI -14 2. Deliberations & Reporting (PUC § 399.30(e), § 399.30(f)) XI -14 3. Annual Review XI -15 4. Plan Modifications/Amendments XI -15 Section XI: Appendices INTRODUCTION This document presents the City of Palo Alto Utilities' (CPAU) Renewable Portfolio Standard Procurement Plan (RPS Procurement Plan), as required for compliance with Senate Bill (SB) 350.3° This legislation, which was signed into law in the 2015 Session of the Legislature, modified the state's renewable portfolio standard (RPS) program and set forth RPS requirements applicable to all load - serving entities in the state. Pursuant to Public Utility Code § 399.30(a) and Section 3205 of the California Energy Commission's (CEC) "Enforcement Procedures for the Renewables Portfolio Standard for Local Publicly Owned Electric Utilities"31 (RPS Regulations), each POU must adopt and implement a renewable energy resources procurement plan (RPS Procurement Plan). SB X1 2, signed into law in 2011, directed the CEC to adopt regulations specifying procedures for enforcement of the RPS for Publicly Owned Utilities. This RPS Procurement Plan replaces the RPS Procurement Plan approved by the Palo Alto City Council (City Council) on November 12, 2013 (Resolution No. 9381, Staff Report No. 4168) and is consistent with the provisions set forth in the CEC's RPS Regulations, which have been adopted by the CEC and approved by the Office of Administrative Law, with an effective date of April 12, 2016.3' CPAU's RPS Procurement Plan consists of: A. Purpose of the plan; B. Plan Elements; C. Measures that address each of the optional provisions set forth in §399.30(d) and RPS Regulations Section 3206; and D. Additional provisions. Where appropriate, this RPS Procurement Plan includes section citations to the Public Utilities Code (PUC) and the CEC's RPS Regulations. In order to fulfill unmet long-term generation resource needs, the City Council adopts and implements this RPS Procurement Plan. This Plan requires the utility to procure a minimum quantity of electricity 3° SB 350 (2015) was signed by California's Governor on October 7, 2015, and made significant revisions to Public Utilities Code sections 399.11-399.32, the California Renewable Portfolio Standard Program. 31 California Code of Regulations, Title 20, Division 2, Chapter 13, Sections 3200 - 3208 and Title 20, Division 2, Chapter 2, Section 1240. 32 At the time of writing for this edition of CPAU's RPS Procurement Plan, the RPS Regulations had not been updated with SB 350 and subsequent legislative requirements. Where both Public Utility Codes and RPS Regulations are cited but the RPS Regulations are outdated, CPAU's RPS Procurement Plan will reflect the more current Public Utility Codes. XI -4 Section XI: Appendices products from eligible renewable energy resources, including renewable energy credits (RECs), as a specified percentage of CPAU's total kilowatt-hours of electrical energy sold to its retail end -use customers, during each compliance period, to achieve the targets specified in SB 350 and the RPS Regulations. This RPS Procurement Plan establishes the framework for achieving the minimum requirements under SB 350 and the RPS Regulations, and does not include or preclude actions taken by CPAU to achieve the City Council's goals. B. PLAN ELEMENTS CPAU will comply with the requirements for renewables procurement targets set forth in SB 350 and the applicable enforcement procedures codified in the CEC's RPS Regulations, including implementation of the following Plan Elements: 1. Compliance Period Definitions CPAU has adopted the relevant compliance period definitions identified in PUC § 399.30(b). 2. Procurement Requirements CPAU shall meet or exceed the following procurement targets of renewable energy resources for each compliance period per PUC §§ 399.30(c)(1) and (2) and the CEC's RPS Regulations: Compliance Period 1 Target >_ 20% x (CPAU Retail Sales2o11_+ CPAU Retail Sales2o12 + CPAU Retail Sales2o13). Compliance Period 2 Target >_ 20% x CPAU Retail Sales2o14 + 20% x CPAU Retail Sales2ois + 25% x CPAU Retail Sales2o16 Compliance Period 3 Target >_ 27% x CPAU Retail Sales2o17 + 29% x CPAU Retail Sales2ols + 31% x CPAU Retail Sales2o19+ 33% x CPAU Retail Sales2o2o Compliance Period 4 Target >_ 34.75% x CPAU Retail Sales2o21 + 36.5% x CPAU Retail Sales2o22 + 38.25% x CPAU Retail Sales2o23+ 40% x CPAU Retail Sales2o24 Compliance Period 5 Target >_ 41.67% x CPAU Retail Sales2o2s + 43.33% x CPAU Retail Sales2o26 + 45% x CPAU Retail Sales2o27 Compliance Period 6 Target >_ 46.67% x CPAU Retail Sales2o28 + 48.33% x CPAU Retail Sales2o29 + 50% x CPAU Retail Sales2o3o Annually thereafter, CPAU shall procure renewable energy resources equivalent to at least fifty percent (50%) of retail kilowatt-hour sales. Section XI: Appendices The procurement targets listed for each individual year above are soft targets. That is, by the end of each Compliance Period, CPAU's RPS total for the period has to equal the sum of the annual targets, but the targets do not have to be achieved in any one year. 3. Portfolio Content Categories (PCC) CPAU adopts the definitions for qualifying electric products and Portfolio Content Categories (PCC) per Sections 3202 and 3203 of the CEC's RPS Regulations. a. How CPAU Plans to Achieve its RPS Requirements per Section 3205(a)(1) of the CEC's RPS Regulations CPAU's RPS portfolio will include grandfathered contracts (commonly referred to as "PCC 0"), which are executed prior to June 1, 2010, and PCC 1 eligible resources, which are typically directly or dynamically connected to a California balancing authority. CPAU's RPS portfolio may also include PCC 2 eligible resources that are scheduled into a California balancing authority, and PCC 3 eligible resources, which are typically unbundled renewable energy credits (RECs). PCC 0 resources are defined in Section 3202(a)(2) of the CEC's RPS Regulations, while PCC 1, 2, and 3 resources are defined in Section 3203 of the CEC's RPS Regulations. CPAU shall determine the category to which each procured resource belongs. In its 2011 through 2017 RPS Compliance Reports, CPAU listed a total of five PCC 0 contracts. All five of these contracts extend through the end of Compliance Period 3, and all have achieved commercial operation. On their own, these PCC 0 contracts were sufficient to enable CPAU to meet its Compliance Period 1 and 2 RPS targets. CPAU has currently executed six contracts for PCC 1 resources. The first five of these, executed between 2012 and 2014, have all commenced operation, between 2014 and 2016. The sixth PCC 1 contract, executed in 2016, is contracted to commence operation in 2021. With these six PCC 1 resources, along with its five PCC 0 contracts, CPAU forecasts that its renewable energy supplies will be well in excess of its procurement requirements through at least Compliance Period 6. 4. Portfolio Balancing Requirements In satisfying the procurement requirements listed in section B.3 of this RPS Procurement Plan, CPAU shall also satisfy the legally -required portfolio balancing requirements specifying the limits on quantities for PCC 1 and PCC 3 per PUC § 399.30(c)(3), §§ 399.16(c)(1) and (2). CPAU shall apply the formulae specified in Section 3204(c) of the CEC's RPS Regulations to determine these portfolio balance requirements. Renewable energy procured from PCC 0 contracts shall be excluded from these portfolio balancing requirement formulae. Section XI: Appendices 5. Long -Term Contract Requirement In meeting the RPS procurement requirements identified in section B.3 of this RPS Procurement Plan, CPAU is subject to long-term contract requirements. Consistent with Public Resources Code § 399.13(b), CPAU may enter into a combination of long- and short-term contracts for electricity and associated renewable energy credits. Beginning January 1, 2021, at least 65 percent of CPAU's procurement that counts toward the RPS requirement of each compliance period shall be from its contracts of 10 years or longer or in its ownership or ownership agreements for eligible renewable energy resources. 6. Reasonable Progress CPAU shall demonstrate that it is making reasonable progress towards ensuring that it shall meet its compliance period targets during intervening years per PUC §§ 399.30(c)(2). OPTIONAL COMPLIANCE MEASURES As permitted by Section 3206(a) of the CEC's RPS Regulations, the City Council hereby adopts rules permitting the use of each of the following five optional compliance measures included in the CEC's RPS Regulations: Excess Procurement, Delay of Timely Compliance, Cost Limitations, Portfolio Balance Requirement Reduction, and Historic Carryover. The City Council also hereby adopts rules permitting the use of the Large Hydro Exemption as described in PUC § 399.30(1). 1. Excess Procurement (PUC §399.13(a)(4)(B)) a. Adoption of Excess Procurement Rules The City Council has elected to adopt rules permitting CPAU to apply excess procurement in one compliance period to a subsequent compliance period, as described in Section 3206(a)(1) of the CEC's RPS Regulations. b. Limitations on CPAU's Use of Excess Procurement CPAU shall be allowed to apply Excess Procurement from one compliance period to subsequent compliance periods as long as the following conditions are met: 1. Excess Procurement shall only include generation from January 1, 2011 or later. 2. In calculating the quantity of Excess Procurement, CPAU shall deduct from actual procurement quantities, the total amount of procurement associated with contracts of less than ten (10) years in duration. Section XI: Appendices 3. Eligible resources must be from Content Category 1 or Content Category 2 or Grandfathered Resources to be Excess Procurement. Resources from Content Category 3 will not count towards Excess Procurement. c. Excess Procurement Calculation CPAU shall calculate its Excess Procurement according to formulae in section 3206 (a)(1)(D) of the CEC's RPS Regulations. d. City Council Review CPAU's use of the Excess Procurement to apply towards CPAU's RPS procurement target in any compliance period will be reviewed by the City Council during its annual review as per section D.3 of this RPS Procurement Plan. 2. Delay of Timely Compliance (§ 399.30(d)(2), § 399.15(b)(5)) a. Adoption of Delay of Timely Compliance Rules The City Council has elected to adopt rules permitting it to make a finding that conditions beyond CPAU's control exist to delay timely compliance with RPS procurement requirements, as described in Section 3206(a)(2) of the CEC's RPS Regulations. b. Delay of Timely Compliance Findings The City Council may make a finding, based on sufficient evidence presented by CPAU staff, and as described in this Section C.2, that is limited to one or more of the following causes of delay, and shall demonstrate that CPAU would have met its RPS procurement requirements but for the cause of the delay: (1) Inadequate Transmission i. There is inadequate transmission capacity to allow for sufficient electricity to be delivered from CPAU's proposed eligible renewable energy resource projects using the current operational protocols of the California Independent System Operator's Balancing Authority Area. ii. If the City Council's delay finding rests on circumstances related to CPAU's transmission resources or transmission rights, the City Council may find that: a.) CPAU has undertaken, in a timely fashion, reasonable measures under its control and consistent with its obligations under local, state, and federal laws and regulations, to develop and construct new transmission lines or upgrades to existing lines intended to transmit XI -8 Section XI: Appendices electricity generated by eligible renewable energy resources, in light of its expectation for cost recovery. b.) CPAU has taken all reasonable operational measures to maximize cost-effective purchases of electricity from eligible renewable energy resources in advance of transmission availability. (2) Permitting, interconnection, or other factors that delayed procurement or insufficient supply. i. Permitting, interconnection, or other circumstances have delayed procured eligible renewable energy resource projects, or there is an insufficient supply of eligible renewable energy resources available to CPAU. ii. In making its findings relative to the existence of this condition, the City Council's deliberations shall include, but not be limited to the following: a) Whether CPAU prudently managed portfolio risks, including, but not limited to, holding solicitations for RPS-eligible resources with outreach to market participants and relying on a sufficient number of viable projects; b) Whether CPAU sought to develop its own eligible renewable energy resources, transmission to interconnect to eligible renewable energy resources, or energy storage used to integrate eligible renewable energy resources. c) Whether CPAU procured an appropriate minimum margin of procurement above the minimum procurement level necessary to comply with the renewables portfolio standard to compensate for foreseeable delays or insufficient supply; d) Whether CPAU has taken reasonable measures, under its control to procure cost-effective distributed generation and allowable unbundled renewable energy credits; (3) Unanticipated curtailment to address needs of the balancing authority. c. Procedures upon Approving Waiver: In the event of a Waiver of Timely Compliance due to any of the factors set forth above, CPAU shall implement the following procedures: (1) Establish additional reporting for intervening years to demonstrate that reasonable actions under the CPAU's control are being taken (§399.15(b)(6)). Section XI: Appendices (2) Require a demonstration that all reasonable actions within the CPAU's control have been taken to ensure compliance in order to grant the waiver (§ 399.15(b)(7)). 3. Cost Limitations for Expenditures (PUC § 399.30(d), § 399.15(c)) a. Cost Limitations for Expenditures The City Council has elected to adopt rules for cost limitations on the procurement expenditures used to comply with CPAU's procurement requirements, as described in Section 3206(a)(3) of the CEC's RPS Regulations. These cost limitation rules are intended to be consistent with PUC §399.15(c). b. Considerations in Development of Cost Limitation Rules In adopting cost limitation rules, the City Council has relied on the following: 1) This Procurement Plan; 2) Procurement expenditures that approximate the expected cost of building, owning, and operating eligible renewable energy resources; 3) The potential that some planned resource additions may be delayed or canceled; and 4) Local and regional economic conditions and the ability of CPAU's customers to afford produced or procured energy products. These economic conditions may include but are not limited to unemployment, wages, cost of living expenses, the housing market, and cost burden of other utility rates on the same customers. The City Council may also consider cost disparities between customer classes within Palo Alto, and between Palo Alto customers and other Publicly Owned Utility and Investor Owned Utility customers in the region. c. Cost Limitations The City of Palo Alto's current RPS policy requires that CPAU pursue a target level of renewable purchases of 33% while "[e]nsuring that the retail rate impact for renewable purchases does not exceed 0.5 C/kWh on average," i.e., the cumulative incremental cost of all renewable resources over and above the estimated cost of an equivalent volume and shape of alternative non-RPS resources shall not cause a retail rate impact in excess of 0.5 C/kWh on average. This limit was first established by the City Council in October 2002 based on public input, and the goal of balancing resource reliability and cost considerations in the consideration of investment in renewable and energy efficiency resources. Section XI: Appendices d. Actions to be Taken if Costs Exceed Adopted Cost Limitation If costs are anticipated to exceed the cost limitations set by the City Council, staff will present proposals to the City of Palo Alto's Utilities Advisory Commission to either reduce the RPS requirements or increase the cost limitation. Staff and the Commission's recommendations will then be taken to the City Council for action. 4. Portfolio Balance Requirement Reduction (PUC § 399.16(e)) a. Adoption of Portfolio Balance Requirement Reduction Rules The City Council has elected to adopt rules that allow for the reduction of the portfolio balance requirement for PCC 1 for a specific compliance period, consistent with PUC §399.16(e), as described in Section 3206(a)(4) of the CEC's RPS Regulations. b. Portfolio Balance Requirement Reduction Rules CPAU may reduce the portfolio balance requirement for PCC1 for a specific compliance period, consistent with PUC §399.16 (e) and the following: 1. The need to reduce the portfolio balance requirements for PCC 1 must have resulted because of conditions beyond CPAU's control, as provided in Section 3206(a)(2) of the CEC's RPS Regulations. 2. CPAU may not reduce its portfolio balance requirement for PCC 1 below 65 percent for any compliance period after December 31, 2016. 3. Any reduction in portfolio balance requirements for PCC 1 must be adopted at a publicly noticed meeting, providing at least 10 calendar days' notice to the CEC, and include an updated renewable energy resources procurement plan detailing the portfolio balance requirement changes. 5. Historic Carryover a. Adoption of Historic Carryover Rules The City Council has elected to adopt rules to permit its use of Historic Carryover, as defined in Section 3206(a)(5) of the RPS Regulations, to meet its RPS procurement targets. Current calculations indicate that CPAU has Historic Carryover due to CPAU's early investment in renewable energy resources. Section XI: Appendices b. Historic Carryover Procurement Criteria CPAU's use of Historic Carryover is subject to section 3206 (a)(5) of the CEC's RPS Regulations, including the following: 1) Procurement generated before January 1, 2011 may be applied to CPAU's RPS procurement target for the compliance period ending December 31, 2013, or for any subsequent compliance period; and 2) The procurement must also meet the criteria of Section 3202 (a)(2) of the CEC's RPS Regulations; and 3) The procurement must be in excess of the sum of the 2004-2010 annual procurement targets defined in Section 3206(a)(5)(D) of the CEC's RPS Regulations; and 4) The procurement cannot have been applied to the RPS of another state or to a voluntary claim. 5) The Historic Carryover must be procured pursuant to a contract or ownership agreement executed before June 1, 2010. 6) Both the Historic Carryover and the procurement applied to CPAU's annual procurement targets must be from eligible renewable energy resources that were RPS-eligible under the rules in place for retail sellers at the time of execution of the contract or ownership agreement, except that the generation from such resources need not be tracked in the Western Renewable Energy Generation Information System. c. Historic Carryover Formula CPAU will calculate its Historic Carryover according to formulae in section 3206 (a)(5)C) and (D) of the CEC's RPS Regulations. d. Historic Carryover Claims The number of RECs qualifying for Historic Carryover is dependent upon the acceptance by the CEC of CPAU's applicable procurement claims for January 1, 2004 — December 31, 2010, which are due to the CEC within 90 calendar days after the effective date of the CEC's RPS Regulations (October 30, 2013). The Historic Carryover submittal shall also include baseline calculations, annual procurement target calculations, and any other pertinent data. e. Council Review CPAU's use of the Historic Carryover to apply towards CPAU's RPS procurement target in any compliance period will be reviewed by the City Council during its annual review as per section D.3 of this RPS Procurement Plan. XI -12 Section XI: Appendices 6. Large Hydro Exemption (PUC § 399.30(1)) a. Adoption of Large Hydro Exemption Rules The City Council has elected to adopt rules permitting CPAU to reduce its annual RPS procurement requirements, as described in PUC §399.30(1). b. Limitations on CPAU's Use of the Large Hydro Exemption CPAU shall be allowed to invoke the Large Hydro Exemption as long as the following conditions are met: 1. During a year with in a compliance period, CPAU shall have received greater than 50% of its retail sales from large hydroelectric generation, which is defined as electricity generated from a hydroelectric facility that is not an eligible renewable energy resource. 2. The large hydroelectric generation is produced at a facility owned by the federal government as a part of the federal Central Valley Project or a joint powers agency. 3. Only large hydroelectric generation that is procured under an existing agreement effective as of January 1, 2015, or an extension or renewal of that agreement, shall counted in the determination that CPAU has received more than 50 percent of its retail sales from large hydroelectric generation in any year. c. Large Hydro Exemption Calculation CPAU's annual RPS procurement target for a year in which the Large Hydro Exemption is invoked shall equal the lesser of (a) the portion of CPAU's retail sales unsatisfied by its large hydroelectric generation or (b) the annual RPS procurement soft target for that year, as listed in section B.2 of this RPS Procurement Plan. CPAU's RPS procurement requirement for the compliance period that includes said year shall be adjusted to reflect any reduction in CPAU's annual RPS procurement target pursuant to this section. d. City Council Review CPAU's use of the Large Hydro Exemption to reduce its annual RPS procurement target in any compliance period will be reviewed by the City Council during its annual review as per section D.3 of this RPS Procurement Plan. Section XI: Appendices 1. Exclusive Control (PUC § 399.30(n)) In all matters regarding compliance with the RPS Procurement Plan, CPAU shall retain exclusive control and discretion over the following: a. The mix of eligible renewable energy resources procured by CPAU and those additional generation resources procured by CPAU for purposes of ensuring resource adequacy and reliability. b. The reasonable costs incurred by CPAU for eligible renewable energy resources owned by it. 2. Deliberations & Reporting (PUC § 399.30(e), § 399.30(f)) a. Deliberations on Procurement Plan (§399.30(f)): (1) Public Notice: Annually, CPAU shall post notice of meetings if the CPA Council will deliberate in public regarding this RPS Procurement Plan. (2) Notice to the California Energy Commission (CEC): Contemporaneous with the posting of a notice for such a meeting, CPAU shall notify the CEC of the date, time and location of the meeting in order to enable the CEC to post the information on its Internet website. (3) Documents and Materials Related to Procurement Status and Plans: When CPAU provides information to the CPA Council related to its renewable energy resources procurement status and future plans, for the City Council's consideration at a noticed public meeting, CPAU shall make that information available to the public and shall provide the CEC with an electronic copy of the documents for posting on the CEC's website. b. Compliance Reporting (Section 3207 of the CEC RPS Regulations) (1) CPAU shall submit an annual report to the CEC by July 1. The annual reports shall include the information specified in Section 3207(c) of the CEC RPS Regulations. (2) By July 1, 2021; July 1, 2025; July 1, 2028; July 1, 2031; and by July 1 of each year thereafter, CPAU shall submit to the CEC a compliance report that addresses the annual reporting requirements of the previous section, and information for the preceding compliance period as specified in Section 3207(d) of the CEC RPS Regulations. Section XI: Appendices 3. Annual Review CPAU's RPS Procurement Plan shall be reviewed annually by the City Council in accordance with CPAU's RPS Enforcement Program. 4. Plan Modifications/Amendments This RPS Procurement Plan may be modified or amended by an affirmative vote of the City Council during a public meeting. Any City Council action to modify or amend the plan must be publicly noticed in accordance with Section D.2.a. Effective Date: This plan shall be effective on , 2018. APPROVED AND ADOPTED this day of , 2018. Section XI: Appendices C. RPS Enforcement Program CITY OF PALO ALTO UTILITIES CITY OF PALO ALTO's RENEWABLE PORTFOLIO STANDARD ENFORCEMENT PROGRAM Version 2 December 2018 REVISION HISTORY Version Date Resolution Description 2 12/3/18 Updated to reflect Senate Bill 350 (2015) requirements 1 12/12/11 9215 Original version per Senate Bill X1 2 (2011) requirements XI -16 Section XI: Appendices 1. The City shall have a program for the enforcement of a Renewable Portfolio Standard (RPS) program, which shall include all of the provisions set forth herein and shall be known as the City's RPS Enforcement Program; 2. The RPS Enforcement Program shall be effective on January 1, 2012; 3. Not less than ten (10) days advance notice shall be given to the public before any meeting is held to make a substantive change to the RPS Enforcement Program; 4. Annually, the City Manager or his designee, the Utilities General Manager, shall cause to be reviewed the City's RPS Procurement Plan to determine compliance with the RPS Enforcement Program; 5. Annual review of the RPS Procurement Plan shall include consideration of each of the following elements: A. By December 31, 2017, December 31, 2018, and December 31, 2019: 1. Ensure that the City is making reasonable progress toward meeting the December 31, 2020 compliance obligation of 33% renewable resources electricity, consistent with the RPS Procurement Plan. B. December 31, 2020 (end of Compliance Period 3), 1. Verify that that the City procured sufficient electricity products to meet the sum of 27% of its 2017, 29% of its 2018, 31% of its 2019, and 33% of its 2020 retail sales with eligible renewable resources from the specified Content Categories, consistent with the RPS Procurement Plan; C. By December 31, 2021, December 31, 2022, and December 31, 2023: 1. Ensure that the City is making reasonable progress toward meeting the December 31, 2024 compliance obligation of 40% renewable resources electricity, consistent with the RPS Procurement Plan. D. December 31, 2024 (end of Compliance Period 4), 1. Verify that that the City procured sufficient electricity products to meet the sum of 34.75% of its 2021, 36.5% of its 2022, 38.25% of its 2023, and 40% of its 2024 retail sales with eligible renewable resources from the specified Content Categories, consistent with the RPS Procurement Plan; Section XI: Appendices E. By December 31, 2025 and December 31, 2026: 1. Ensure that the City is making reasonable progress toward meeting the December 31, 2027 compliance obligation of 45% renewable resources electricity, consistent with the RPS Procurement Plan. F. December 31, 2027 (end of Compliance Period 5), 1. Verify that that the City procured sufficient electricity products to meet the sum of 41.67% of its 2025, 43.33% of its 2026, and 45% of its 2027 retail sales with eligible renewable resources from the specified Content Categories, consistent with the RPS Procurement Plan; G. By December 31, 2028 and December 31, 2029: 1. Ensure that the City is making reasonable progress toward meeting the December 31, 2030 compliance obligation of 50% renewable resources electricity, consistent with the RPS Procurement Plan. H. December 31, 2030 (end of Compliance Period 6), 1. Verify that that the City procured sufficient electricity products to meet the sum of 46.67% of its 2028, 48.33% of its 2029, and 50% of its 2030 retail sales with eligible renewable resources from the specified Content Categories, consistent with the RPS Procurement Plan; I. December 31, 2031 and annually thereafter, 1. Verify that that the City procured sufficient electricity products to meet 50% of its retail sales with eligible renewable resources from the specified Content Categories, consistent with the RPS Procurement Plan; J. If targets in any compliance period are not met, the City must: 1. Review the applicability of applying Excess Procurement from a previous Compliance Period or Historic Carryover consistent with the provisions of the RPS Procurement Plan; 2. Ensure that any Waiver of Timely Compliance was compliant with the provisions in the RPS Procurement Plan; 3. Ensure that any Portfolio Balance Requirement Reduction was compliant with the provisions in the RPS Procurement Plan; and 4. Review applicability and appropriateness of excusing performance based on the Cost Limitations on Expenditures or the Large Hydro Exemption provisions of the RPS Procurement Plan. Section XI: Appendices 6. If it is determined that the City has failed to comply with the provisions of its RPS Procurement Plan, the City Council shall take steps to correct any untimely compliance, including requiring the City Manager or his designee, the Utilities General Manager to: A. review the City's RPS Procurement Plan to determine what changes, if any, are necessary to ensure compliance in the next Compliance Period; B. report quarterly to the City Council regarding the progress being made toward meeting the compliance obligation for the next Compliance Period; and C. report to the City Council regarding the status of meeting subsequent compliance targets, and all steps being taken to ensure that the obligation is timely met. 1 2 2a 3 4 5 6 7 8 9 10 Stat e of Calif ornia Calif ornia Energy C ommissi on Standardiz ed Reporti ng Tabl es for Public Ow ned Utility IRP Fili ng Capadty Resource Acco unti ng Table f orm ac um IM sy 201,1 Scenario Name: Expected PEAK LOAD CALCULATIONS 15% ]� S r Y ell ow fill r elates to an applicati on f or c onfidentiality. Units= MW Data input by User are in dark green font . 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Forecast T otal Peak -Hour 1 -i n -2 D emand [Customer -side solar: nameplate capacity] [Customer -side solar: peak hour output] [Peak load reduction due to thermal energy storage] [Light Duty PEV consumption in peak hour] Additional Achi evable En ergy Efficiency Sa vi ngs on Peak Demand Response / Interruptible Programs on P eak Man age d Pe ak Dem and (1-5-6) Planning Reserve Margin 185 155 166 165 164 163 162 161 160 158 156 155 153 151 15 17 19 21 22 24 25 27 29 32 34 37 41 44 12 14 15 16 17 18 20 21 23 25 27 29 32 34 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 2 2 3 4 5 6 7 8 9 10 11 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 2 2 3 4 5 6 7 185 155 166 165 164 163 161 160 158 155 152 150 147 144 25 25 25 25 24 24 24 23 23 22 22 22 Firm Sales Obligations To ta l Peak Pro curement Requirem ent (7+809) 185 155 190 190 189 188 186 184 182 179 175 172 169 166 11a 118 llh 11 12a 12n 120 12p 12q 12r 12. .. 12... 12... 12. .. 12... 12. .. 12... 12... 12. .. 12... 12 13 14a 14 15a 15 16 17 18 19 20 21 EXISTING AND PLANNED CAPACITY SUPPLY RESOURCES Utility -O wned Generatio n and Storage (n ot RPS- eligible): [list resource by name] Fuel 2017 2018 2019 _ 2020 r 2021 2022 _ 2023 2024 r 2025 _ 2026 _ 2027 2028 2029 r 2030 Co llierville Hydroelectric 57' 57 57 57 57 57 57 57 57 57 57 57 Lon g -Te rm Co ntracts (no t RPS-e ligible): [list contracts by name] Fuel Western B ase Resource G en eration Hydroelectric 191 183 175 175 175 175 175 175 175 175 175 175 To ta l pea k de pen dable ca pacity of ex istin g an d plann ed su pply res ources (no t RPS-eligible) (su m of 11a... 11n ) 0 0 247 240 232 232 232 232 232 232 232 232 232 232 Utility -O wned RPS-eligible Re so urce s: (list reso urce by plant or un it] Fuel N ew Spicer Hydro electric Hydr oelectric l 1 l 1 l 1 i 1 1 1 1 1 1 1 Long -Term Contracts (RPS-eligible): (list contracts by name] Fuel PROJECT#I - HIGHWIND S Wind 10 10 12 10 10 10 10 10 10 0 0 0 PROJECT#2- SHILOH#1 Wind 12 12 10 0 0 0 0 0 0 0 0 0 Santa Cruz (Bu en a Yst Lan dfill) Landfill Gas 2 2 2 2 2 2 2 0 0 0 0 0 OxMountain(HalfMoonBay) Landfill Gas 5 5 5 5 5 5 5 5 5 5 0 0 Ke ller Can yo n Landfill Gas 2 2 2 2 2 2 2 2 2 2 2 0 Johnson Can yon (Ameresco ) Landfill Gas 1 1 1 1 1 1 1 1 1 1 1 1 Sao Joa qu in (Ameresco ) Landfill Gas 4 4 4 4 4 4 4 4 4 4 4 4 EEK ettleman Lan d ' So lar 0 0 0 0 0 0 0 0 0 0 0 0 E lev ation So lar C So lar 34 34 34 34 34 34 0 0 0 0 0 0 Western A ntelope Blue Sky Ran ch B So lar 17 17 17 17 17 17 17 17 17 17 17 17 Fron tier Solar So lar 0 0 0 0 0 0 0 0 0 0 0 0 Haywo rth Sola r Solar 22 22 22 22 22 22 22 22 22 22 22 22 Wilsoa So lar So lar 0 0 0 0 0 0 0 0 0 0 0 0 Palo Alto CLEAN Pro jects Solar 1 1 1 1 1 1 1 1 1 1 1 1 To ta l pe ak de pen dable ca pacity of ex isting an d planne d RPS-e ligible resources (sum of 12a... 12n) 1 1 29 29 29 17 17 17 17 16 16 6 1 1 To ta l pe ak de pen dable ca pacity of ex istin g an d plann ed su pply reso urce s (11+ 12) 1 1 277 269 261 249 249 249 249 248 248 238 233 233 G EN ERIC A DDITIO NS NO N-RPS EUGIBLE RESO URCES: (list reso urce by name or descriptio n] Fuel 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Non e Total peak dependable capacity of gen eric supply reso urces (not RPS- e ligible) 0 0 0 0 0 0 0 0 0 0 0 0 RPS-ELIGIBLE RESOURCES: (list resource by name or description] Fuel To ta l pe ak de pen da ble ca pacity of gene ric RPS-eligible re so urce s 0 0 0 0 0 0 0 0 0 0 0 0 Total peak de pen dable capacity of gen eric supply reso urces (14+ 15) 0 0 0 0 0 0 0 0 0 0 0 0 CAPACITY BA LANCE SUMMA RY 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 r 2027 2028 2029 2030 To ta l pe ak pro cure me nt require ment (fro m line 10) 185 155 190 190 189 188 186 184 182 179 175 172 169 166 To ta l pe ak de pen dable ca pacity of ex istin g an d planne d su pply reso urces (fro m lin e 13) 1 1 277 269 261 249 249 249 249 248 248 238 233 233 Curren t capacity surplus (sho rtfall) (18-17) (184) (154) 86 79 72 61 64 66 68 69 73 66 64 67 Total peak depen dable capacity of gen eric supply reso urces (front line 16) 0 0 0 0 0 0 0 0 0 0 0 0 Plann ed capacity surplus/sho rtfall (sho rtfalls a ssume d to be met with short-term capacity purchases) (19+ 20) (184) (154) 86 79 72 61 64 66 68 69 73 66 64 67 Capacity Resource Adequacy Table (CRAT) sajgoj dui paz!paap uan .0 saJipuaddd :Ix uowas Section XI: Appendices ii. Energy Balance Table (EBT) 1 2 3 4 5 6 7 8 9 10 11 State of California California Energy Commission Standardized Reporting Tables for Public Owned Utility IRP Filing Energy Balance Table w,m vaPdnamr Scenario Name: Expected NET ENERGY FOR LOAD CALCULATIONS yly a�4 Yellow fill elates to an application for confidentiality. Units= MWh Historical Data 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Retail sales to end -use customers 3% Other loads 600 Unmanaged net energy for load Managed retail sales to end -use customers ' No AAEE 0% Managed net energy for load Firm Sales Obligations 0 Total net energy for load (5+6) ]Customer -side solar generation] [Light Duty PEV electricity procurement requirement] [Other transportation electricity .. ,,,pti0,./Procurement requirement] 913,986 911,077 907,555 904,572 903,149 902,329 902,293 902,447 902,638 903,238 903,835 905,452 27,438 27,332 27,227 27,960 27,914 27,887 27,908 27,911 27,916 27,934 27,952 28,001 913,986 913,986 941,423 938,410 934,782 932,532 931,063 930,216 930,201 930,358 930,553 931,173 931,787 933,453 913,986 911,077 907,555 904,572 903,149 902,329 902,293 902,447 902,638 903,238 903,835 905,452 941,423 938,410 934,782 932,532 931,063 930,216 930,201 930.358 930,553 931,173 931,787 933,453 0 0 0 0 0 0 D 0 0 0 0 0 941,423 941,423 941,423 938,410 934,782 932,532 931,063 930,216 930,201 930,358 930,553 931,173 931,787 933,453 18,005 20,277 22,674 24,065 25,620 27,360 29,304 31,474 33,897 36,599 39,614 42,975 46,719 50,890 7,316 9,510 11,967 14,704 17,685 20,933 24,444 28,246 32,275 36,579 41,144 46,008 51,073 56,406 0 0 0 0 0 0 0 0 0 0 0 0 ]Other el ectrification/fuelsubstltution; --- /p ment requirement] 146 288 476 730 1,049 1,423 1,876 2,431 3,083 3,831 4,639 5,507 120 126 12 130 131 13j 13k 131 13m 13n 13... 13... 13... 13... 13... 13... 13... 13... 13... 13 13z 14 150 15 16a 160 16 17 177 18 19 19a 20 21 22 23 EXISTING AND PLANNED GENERATION RESOURCES Utility -Owned Generation Resources ]not RPS-eligible): [list resource by name] 2017 2018 2019 2020 2021 2022 2023 2024. 2025 2026 .2027 2028 2029 2030 Collierville Hydroelectric 241,017 92,779 115,701 131,668 131,668 131,668 131,668 131,668 131,668 131,668 131,668 131,668 131,668 131,668 Long -Term Contracts (not RPS-eligible): [list contracts by name] Western Base Resource Generation 6 auto -updating 541,539 411,405 409,511 385,814 364,289 364,289 364,289 364,289 364,289 364,289 364,289 364,289 364,289 364,289 Total energy from existing and planned supply resources (not RPS-eligible) (sum of 12a...12n) 782,556 504,184 525,212 517,482 495,957 495,957 495,957 495,957 495,957 495,957 495,957 495,957 495,957 495,957 Utility -Owned RPS-eligible Generation Resources: [list resource by plant or unit] New Spicer Hydroelectric Hydroelectric 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 Long -Term Contracts (RPS-eligible): [list contracts by name] PROJECT#1- HIGHWINDS Wind 48,207 42,664 42,668 42,754 42,721 42,708 42,672 42,711 42,671 42,709 42,722 12,615 0 0 PROJECT #2-SHILOH#I Wind 64,513 57,281 57,290 57,425 57,366 0 0 0 0 0 0 0 0 0 Santa Cruz (Buena Vist Landfill) Landfill Gas 9,853 8,961 8,961 8,986 8,961 8,961 8,961 8,985 8,961 1,449 0 0 0 0 Ox Mountain (Half Moon Bay) Landfill Gas 43,880 42,459 42,459 42,575 42,459 42,459 42,459 42,570 42,459 42,459 42,459 42,575 13,959 0 Keller Canyon Landfill Gas 14,894 13,827 13,827 13,865 13,827 13,827 13,827 13,863 13,827 13,827 13,827 13,865 9,205 0 Johnson Canyon (Aneresco) Landfill Gas 10,433 9,200 9,200 9,225 9,200 9,200 9,200 9,224 9,200 9,200 9,200 9,225 9,200 9,200 San Joaquin(Ameresco) Landfill Gas 30,283 27,468 27,468 27,544 27,468 27,468 27,468 27,540 27,468 27,468 27,468 27,544 27,468 27,468 EE Kettleman Land Solar 53,056 52,791 52,527 52,264 52,003 51,743 51,484 51,227 50,971 50,716 50,462 50,210 49,959 49,709 Elevation Solar C Solar 100,695 100,191 99,690 99,192 98,696 98,203 97,712 97,223 96,737 96,253 95,772 95,293 94,817 94,343 Western Antelope Blue Sky Ranch B Solar 50,367 50,115 49,864 49,615 49,367 49,120 40474 48,590 48.387 48,145 47,904 47,665 47,426 47,189 Frontier Solar Solar 52,338 52,077 51,816 51,557 s . r ,. 10,030 49,780 49,531 49,283 49,037 Hayworth Solar Solar 63,402 63,085 62,770 62,456 .. :,0.606 60,302 60,001 59,701 59,402 Wileona Soler Solar 0 0 0 0 s., 42,021 .� .-. �,.. 13,290 72,924 72,559 72,196 71,835 Palo Alto CLI'AN Pro'ects Solar 2,062 2,052 2,042 2,031 2,011 2,001 1,991 1,981 1,971 1,961 1,951 1,942 1,932 Sma11 Part of Western Area Power Association Hydroelectric 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,00D 5,000 5,000 5,000 5,000 5,000 Total energy from RPS-eligible resources (sum of 13a...13n, and 13.) 553,984 532,171 530,582 529,489 572,668 543,350 541,370 539,743 537,511 528,123 524,782 493,034 445,156 420,115 Undelivered RPS energy 279,647 180,530 286,651 280,085 283,889 267,401 268,341 268,959 263,937 260,465 260,927 248,251 231,363 223,885 Total energy from existing and planned supply resources(12.13) 1,336,540 1,036,355 1,055,794 1,046,970 1,068,625 1,039,307 1,037,327 1,035,700 1,033,468 1,024,080 1,020,739 988,991 941,114 916,073 GENERICADDITIONS NON-RPS ELIGIBLE RESOURCES: [lIst resource by name or description] 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Total ene 3 from nericsupp resources :HARPS -eligible) RPS-EUGIBIE RESOURCES: [list resource by name or dewed •Bon) 0 0 0 0 0 0 0 0 0 0 0 0 Total energy from generla RPSeligible resources 0 0 0 0 D 0 0 0 0 0 0 0 Total energy from generic supply resources (15+16) 0 0 0 0 0 0 0 0 0 0 0 0 Total en e i from RPS-ell o Isle short-term contracts ENERGY FROM SHORT-TERM PURCHASES 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Short term and spot market purchases: 81,940 79,524 154,110 182,370 160,888 170,642 172,094 173,495 177,953 184,029 188,028 207,719 239,323 258,553 ENERGY BALANCE SUMMARY 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Total energy from supply resources)14+170170) 1,336,540 1,036,355 1,055,794 1,046,970 1,068,625 1,039,307 1,037,327 1,035,700 1,033,468 1,024,080 1,020,739 988,991 941,114 916,073 Undelivered RPS energy (from 13z) 279,647 180,530 286,651 280,085 283,889 267,401 268,341 268,959 263,937 260,465 260,927 248,251 231,363 223,885 Short term and spot market purchases (from 18) 81,940 79,524 154,110 182,370 160,888 170,642 172,094 173,495 177,953 184,029 188,028 207,719 239,323 258,553 Total delivered energy )19-19a+20) 1,138,833 935,349 923,253 949,255 945,624 942,548 941,081 940,236 947,485 947,643 947,840 948,459 949,074 950,741 Total net energy for load (frorn 7) 941,423 941,423 941,423 938,410 934,782 932,532 931,063 930,216 930,201 930,358 930,553 931,173 931,787 933,453 Surplus/Shortfall (21-22) 197,409 (6,075) (18,170) 10,845 10,842 10,016 10,018 10,020 17,284 17,286 17,287 17,287 17,287 17,288 XI -21 Section XI: Appendices iii. GHG Emissions Accounting Table (GEAT) la lh ln 1 2a 2h 2i 2] 2k 21 2m 2n 2... 2... 2... 2... 2... 2... 2... 2... 2 3 4a 4b 4 5a 5b 5 6 7 8 8a 8b 8c 8d Be 8f 9 10 12 State of California California Energy Commission Standardized Reporting Tables for Public Owned Utility IRP Filing GHG Emisainna Accounting Table Scenario Name: Expected GHG EMISSIONS FROM EXISTING AND PLANNED SUPPLY RESOURCES Emissions Yearly ms's Yellow fill relates to an application for confidentiality. Intensity Units = mt CO2e/MWh Emissions Total Units= Mmt CO2e Utility -Owned Generation (not RPS-eligible): [list resource by name] Emissions Intensity 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 r #REPI 0 0 0 0 0 0 0 0 0 0 0 0 0 Long -Term Contracts (not BPS -eligible): [list contracts by name] Emissions IMensIty Western Base Resource Generation 0 0 0 0 0 0 0 0 0 0 0 0 0 Total GHG emissions of existing and planned supply resources (not RPS eligible)(sum ofla...1n) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Utility -Owned RPSeligible Generation Resources: [list resource by plant or unit] Emissions Intensity New Spicer Hydroelectric 0 0 0 0 0 0 0 0 0 0 0 0 0 Long.Term Contracts (RPS-eligible): [list contracts by name] Emissions Intensity PROJECT#I- HIGHWINDS 0 PROJECT #2-SHILOH#1 0 Santa Cruz (Buena Vtat landfill) 0 Ox Mountain (Half Moon Bay) 0 Keller Canyon 0 Johnson Canyon(Aooresco) 0 San Joaquin(Ameresco) 0 EEKetdeman Land 0 Elevation Solar C 0 Western Antelope Blue SkyRaaohB 0 Frontier Solar 0 Hayworth Solar 0 Wilson Solar 0 Palo Alto CLEAN Projects 0 Small Part of Western Area Power Association 0 Total GHG emissions from RPS-eligible resources (sum of 2a...2n) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Total GHG emissions from existing and planned supply resources (1+2) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 EMISSIONS FROM GENERIC ADDITIONS NON-RP5 ELIGIBLE RESOURCES: [list resource by name or description] Emissions Intensity 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Total GHG emissions from generic supply resources (not RPS.ellgible) 0 0 0 0 0 0 0 0 0 0 0 0 RPSEUGIBLE RESOURCES: [list resource by name or description] Emissions Intensity Total GHG emissions from generic RPS-eligible resources 0 0 0 0 0 0 0 0 0 0 0 0 Total GHG emissions from generic supply resources (4+5) 0 0 0 0 0 0 0 0 0 0 0 0 GHG EMISSIONS OF SHORT TERM PURCHASES Emissions Intensity 2017 2018 2019 2020 2021 2022 2023 2024 2025 f 2026 2027 2028 2029 2030 Short term and spot market purchases: 0.428 35,070 34,036 65,959 78,054 68,860 73,035 73,656 74,256 76,164 78,764 80,476 88,904 102,430 110,661 TOTAL GHG EMISSIONS 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Total GHG emissions to meet net energy for load (3+6+7) 35,070 34,036 65,959 78,054 68,860 73,035 73,656 74,256 76,164 78,764 80,476 88,904 102,430 110,661 EMISSIONS ADJUSTMENTS Undelhrered RPS energy (Mb from EBT) 279,647 180,530 286,651 280,085 283,889 267,401 268,341 268,959 263,937 260,465 260,927 248,251 231,363 223,885 Firm Sales Obligations (MWh from EBT) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Total energy for emissions adjustment (8a+8b) 279,647 180,530 286,651 280.085 283,889 267,401 268,341 268,959 263,937 260,465 260,927 248,251 231,363 223,885 Emissions intensity (portfolio gas/short-term and spat market purchases) 0.428 0.428 0.428 0428 0.428 0.428 0.428 0428 0.428 0.428 0428 0.42_8 0.428 0.428 Emissions adjustment (8Cx8D) 119,689 77,267 122,687 119.877 121,505 114,448 114,850 115.114 112,965 111.479 111,677 106.251 99,023 95.823 PORTFOLIO GHG EMISSIONS Portfolio emissions (8-8e) -84.619 -43,231 -56,728 -41,822 -52,645 -41,413 -41,193 -40,859 -36.801 -32,715 -31,201 -17,348 3.407 14,838 GHG EMISSIONS IMPACT OF TRANSPORTATION ELECTRIFICATION 7 201002 8 201003 2010.04 901 2020.04 04 1 202004 2 2020.05 200.05 200.05 5 2020.05 6 20.050 Ir 2027 20280 200.05 2029 0 2030.055 GHG emissions reduction due to gasoline vehicle displacement by lD PEVs 0.05 GHG emissions increase due to 1.0 PEV electricity loads 0 010 0 05 0 GHG emissions reduction due to fuel displacement - .her transportation electrification - - - - - - - - - - - - - - GHG emissions increase due to increased electricity loads - other transportation electrification 0 0 0 0 0 0 0 0 0 0 0 0 0 0 XI -22 State of Calif ornia C alif ornia Energy Commissio n Standardized R eporting Tabl es f or P ublic Ow ned Utility IRP Filing RPS Pr oc urement Table RPS ENERGY REQUIREMENT CALCULATIONS 1 (Managed) Retail sales to end -use customers (From EBT) 2 Green pricing program/hydro exclusi on 3 Soft target (%) 4 Required procurem ent f or c ompliance p eriod Cate go ry 0.1 and 2 RECs 5 Excess balance/historic carryover at beginni ng/ end of compliance perio d 6 RPS-eligible ene rgy pro cured (copi ed fr om EBT) 6A Amount of e nergy applied to procurement obligati on 7 Net pu rchases of Cate gory °, 1 and 2 RECs 7A Carryov er and REC purchases applied to procureme nt obligati on 8 Net change in balance/carryove r (6+7-64-74) Cate gorv 3 RECs 5 Excess balance/histo ric carryov er at beginnin g/end of compliance perio d 10 Ne t purchases of Cate gory 3 RECs 11 Carryove r and REC purchase s a pplied to pro curement obligation 12 Net c hange in REC ba lance /carryover 13 Total gen eration plu s RECs (all Catego rie s) applied to pro curement require ment (6A+ 7A+ 11) 14 Ove r/unde r pro curement for co mpliance period (11-41 Beginni ng balances Units= MWh Start 012017 C omplia nce Peri od 626 C omplianc e Peri od 4 2017 2018 2019 2020 2021 2022 2023 2024 913,986 913,986 913,986 911,077 28,201 28,201 28,201 28,201 27.00% 29.00% 31 .00% 33.00 % 1,061,982 553,984 239,162 0 0 14,822 56,878 275.293 0 0 907,555 904,572 903,149 902,329 28,201 28,201 28,201 28,201 34.75% 36 .50% 38.25 % 40 .00 % 1,309,770 756,746 530 ,582 529 ,489 572,668 543,350 541,370 539 ,743 (530,582 106198 106198 1,061,982 (529,489 (144,922 (572,668) (272,83 32744 32744 0 0 105 ,139 316,907 (543,350) (287,131) 32744 32744 0 (436,231) (196,784) 32244 32744 (222 ,836 32244 32744 0 0 1,309,770 C ompliance Peri od 5 2025 902,293 28,201 41 .67 331,491 (206,020) 32744 32744 0 2026 902,447 28,201 43 .33 1,136,541 528,123 346,067 (182,056) 0 32744 0 2027 902,638 28,201 45.00% 524 ,282 360,752 (164 ,029) 32744 32744 1,136,542 2028 903.238 493,034 375,636 7,398) C ompliance Period 6 2029 903,835 28,201 ,270,199 2030 905,452 28,201 5156 420 ,115 390,450 405,881 (54,707) (1 0 0 322 32744 0 2744 2744 0 ,234) • 00 % r) 3 r -F H a) 0 r0 ,270,199 saJipuaddd :Ix uowas Attachment C Electric Integrated Resource Plan (EIRP) Objective and Strategies EIRP Objective To provide safe, reliable, environmentally sustainable and cost-effective electric resources and services to all customers. EIRP Strategies 1. Pursue an Optimal Mix of Supply-side and Demand -side Resources: When procuring to meet demand, pursue an optimal mix of resources that meets the EIRP Objective, with cost-effective energy efficiency, distributed generation, and demand -side resources as preferred resources. Consider portfolio fit and resource uncertainties when evaluating cost-effectiveness. 2. Maintain a Carbon Neutral Supply: Maintain a carbon neutral electric supply portfolio to meet the community's greenhouse gas (GHG) emission reduction goals. 3. Actively Manage Portfolio Supply Cost Uncertainties: Structure the portfolio or add mitigations to manage short-term risks (e.g. market price risk and hydroelectric variability) and build flexibility into the portfolio to address long-term risks (e.g. resource availability, customer load profile changes, and regulatory uncertainty) through diversification of suppliers, contract terms, and resource types. 4. Manage Electric Portfolio to Ensure Lowest Possible Ratepayer Bills: Pursue resources in a least -cost, best -fit approach in an effort to ensure ratepayer bills remain as low as possible, while adhering to Council -adopted sustainability, rate, and financial objectives and guidelines. 5. Partner with External Agencies to Implement Optimization Opportunities: Engage and partner with external agencies to maximize resource value and optimize operations. 6. Maintain Flexible Supplies to Effectively Meet Changes in Customer Loads & Load Profiles: Maintain electric supply resource flexibility in anticipation of potential changes in customer loads due to distributed energy resources, efficiency, electrification, or for other reasons. 7. Ensure Reliable and Low -Cost Transmission Services: Work with the transmission system operator to receive reliable service in a least cost manner. 8. Support Local Electric Supply Resiliency: Coordinate supply portfolio planning with utility -wide efforts to support local measures and programs that enhance community electric supply resiliency. 9. Comply with State and Federal Laws and Regulations: Ensure compliance with all statutory and regulatory requirements for energy, capacity, reserves, GHG emissions, distributed energy resources, efficiency goals, resource planning, and related initiatives. 6055046 Attachment D EIRP Strategies & Related New Initiatives There are a number of new initiatives and numerous on -going tasks related to implementing the EIRP Strategies. These activities are supported by about six to eight CPAU staff, both from the supply side and demand -side (or customer) programs. In addition, CPAU relies on joint action agencies and external service providers to implement programs and initiatives. Supply and customer program staff also coordinates with retail rate development, distribution system engineering, and operations staff to implement programs and investments in an integrated manner. Described below are the nine strategies and eight new initiatives that are expected to be undertaken in the next three to six years. Work tasks related to on -going activities have not been called out separately. EIRP Strategies & Related New Initiatives 1. Pursue an Optimal Mix of Supply-side and Demand -side Resources: When procuring to meet demand, pursue an optimal mix of resources that meets the EIRP Objective, with cost-effective energy efficiency, distributed generation, and demand -side resources as preferred resources. Consider portfolio fit and resource uncertainties when evaluating cost-effectiveness. a. Initiative #1: Evaluate the merits of committing to a new 30 -year contract with Western starting in 2025. [Recommendation on initial commitment to the UAC in early 2020; recommendation on final commitment in early 2024.] b. Initiative #2: Evaluate the merits of rebalancing the electric supply portfolio to lower its seasonal and daily market price exposure, by more closely balancing the City's Tong -term supplies with its hourly and monthly electric loads. [Initial scoping assessment report to the UAC by December 2019.] c. Initiative #3: Evaluate how to best utilize the City's share of the California - Oregon Transmission Project (COTP), when the long-term layoff of this asset ends in 2024. [Initial assessment report to UAC by December 2019, in tandem with Initiative #2 initial scoping assessment report.] d. Continue ongoing evaluation of all cost-effective distributed energy resources (DERs), such as energy efficiency, distributed generation, energy storage, and demand response. Update forecasts of DER impacts on retail sales and load shapes for use in strategic planning, rate -making, and budget forecasting. [Initial assessment to be completed in Distributed Energy Resource (DER) and Customer Program Plan for Council approval by June 2019.] 2. Maintain a Carbon Neutral Supply: Maintain a carbon neutral electric supply portfolio to meet the community's greenhouse gas (GHG) emission reduction goals. a. Initiative #4: In addition to ensuring 100% of City's annual electricity energy needs are met with carbon neutral supplies (on a kWh basis), evaluate the carbon content of the electric portfolio on an hourly basis, and recommend the merits of buying carbon offsets to ensure the carbon content of the cumulative hourly portfolio is zero on an annual basis. Also evaluate the manner in which the City communicates with customers about the carbon content of the electric portfolio. [Initial staff recommendation to the UAC by December 2019.] 3. Actively Manage Portfolio Supply Cost Uncertainties: Structure the portfolio or add mitigations to manage short-term risks (e.g. market price risk and hydroelectric variability) and build flexibility into the portfolio to address long-term risks (e.g. resource availability, customer load profile changes, and regulatory uncertainty) through diversification of suppliers, contract terms, and resource types. a. This is an on -going active management strategy; no new initiatives are planned. 4. Manage Electric Portfolio to Ensure Lowest Possible Ratepayer Bills: Pursue resources in a least -cost, best -fit approach in an effort to ensure ratepayer bills remain as low as possible, while achieving other Council -adopted sustainability, rate, and financial objectives. a. Initiative #5: Investigate the merits and economics of monetizing excess renewable energy certificates to minimize the cost of maintaining an RPS compliant and carbon neutral electricity supply portfolio. [Initial staff recommendation to the UAC by December 2019.] 5. Partner with External Agencies to Implement Optimization Opportunities: Actively engage and partner with external agencies to maximize resource value and optimize operations. a. Initiative #6: Explore greater synergistic opportunities with NCPA and other agencies — such as newly formed community choice aggregators — to lower Palo Alto's operating costs and rebalance the supply portfolio. [Initial assessment to UAC by December 2019.] 6. Manage Supplies to Meet Changing Customer Loads and Load Profiles: Maintain electric supply resource flexibility in anticipation of potential changes in customer loads due to distributed energy resources, efficiency, electrification, or for other reasons. At the same time, use retail rates and other available tools to influence customer load changes in a manner that minimizes overall costs and achieves other Council objectives. a. Initiative #7: Implement 2018 Utilities Strategic Plan Priority 4, Strategy 4, Action 2 by undertaking a competitive assessment for the electric utility within the context of the large proliferation of customer -sited DER technologies, electrification initiatives, changing customer expectations, and potential regulatory changes. Develop contingencies to address the potential for large changes in the City's load level or load profile. [Initial assessment to UAC in December 2020.] 7. Ensure Reliable and Low-cost Transmission Services: Work with the transmission system operator to receive reliable service in a least -cost manner. a. This is an on -going activity; no new initiatives are planned. 8. Support Local Electric Supply Resiliency: Coordinate supply portfolio planning with utility -wide efforts to support local measures and programs that enhance community electric supply resiliency. a. On -going supporting role in utility -wide efforts. 9. Comply with State and Federal Laws and Regulations: Ensure compliance with all statutory and regulatory requirements for energy, capacity, reserves, GHG emissions, distributed energy resources, efficiency goals, resource planning, and related initiatives. a. Ongoing activities in collaboration with NCPA, CMUA and other joint action agencies. ATTACHMENT E PALO ALTO DRAFT UTILITIES ADVISORY COMMISSION MEETING EXCERPT OF MINUTES OF OCTOBER 3, 2018 REGULAR MEETING UNFINISHED BUSINESS ITEM 1: ACTION: Utilities Advisory Commission Recommendation that the Finance Committee Recommend that the City Council Adopt a Resolution to Approve the 2018 Electric Integrated Resource Plan (EIRP), Updated Renewable Portfolio Standard Procurement Plan and Enforcement Program, and Related Documents. Jonathan Abendschein, Assistant Director of Resource Management, recalled that the Commission first heard staff's presentation in September. The Commission will have opportunities to discuss major strategic initiatives in the future. Jim Stack, Senior Resource Planner, reported CPAU has been planning electric integrated resources (EIR) for many years, most recently under the framework of the Long-term Electric Acquisition Plan (LEAP), which was last updated in 2012. In 2015, SB 350 was passed and established new EIR planning requirements for large utilities like CPAU. SB 350 requires CPAU to submit an Electric Integrated Resource Plan (EIRP) to the California Energy Commission (CEC) every five years with the first one due in early 2019. SB 350 also established aggressive statewide targets related to renewables, greenhouse gas emissions, and energy efficiency. Staff is waiting for the CEC to establish regulations for the requirement to double energy efficiency levels by 2030. The CEC requires the completion of four standardized tables that will provide visibility into the actual details of supply and load forecasts to 2030. CPAU is also required to submit an updated version of its Renewable Portfolio Standards (RPS) Procurement Plan that reflects SB 350 changes to the renewables requirement. While CPAU is not required to submit an updated RPS Enforcement Program, staff updated the Enforcement Program and included it in the documentation. The EIRP details the state of the current (2018) supply portfolio, describes expectations for the 2030 portfolio, and discusses the major decisions to be made. The primary decision is whether to renew the Western Base Resource contract in 2025 for an additional 30 -year period. The uncertainty around the decision is represented by the unknown carbon -neutral area of the 2025 portfolio. The EIRP does not discuss energy -efficiency program planning. In response to Vice Chair Schwartz's query regarding whether staff was recommending elimination of the Western contract, Stack explained that the EIRP highlights the Western contract as an upcoming discussion. The EIRP's default scenario is contract renewal, but alternative options are explored in the EIRP. Chair Danaher requested staff provide periodic updates on the process, contract issues, and analysis so that the Commission can be educated as the process moves forward. Stack continued with the EIRP objective, strategies, and work plan. The EIRP objective is modeled after the Electric Utility's mission statement. The seven new initiatives listed in the work plan will be undertaken over the next few years. The California -Oregon Transmission Project (COTP) will return to the City's portfolio in 2024. Within the initiative for carbon accounting, staff is planning to address City communications with customers and the public regarding the portfolio's carbon content. CPAU could partner with external agencies such as Community Choice Aggregation (CCA) organizations. Utilities Advisory ConTrission Minutes Approved on: Page 1 of 3 Vice Chair Schwartz remarked that she could not imagine a partnership with a CCA that would benefit CPAU and questioned whether partnerships were specific to CCAs. Stack clarified that partnerships could include CCAs or other agencies. Staff could explore partnerships with CCAs for commodities trading or customer programs. Abendschein added that staff will look for opportunities to partner with CCAs. Stack continued with next steps of presenting the EIRP and related documents to the Finance Committee and Council for review; submitting the required documents to the CEC early in 2019; and beginning work on the new initiatives listed in the work plan. Staff will provide periodic updates to the Commission regarding progress. Commissioner Segal appreciated staff including communications to the community in the initiatives. In reply to Commissioner Johnston's inquiry regarding the meaning of fully deliverable resources, Stack stated fully deliverable is not the same as dispatchable. Fully deliverable is a term used by the California Independent System Operator (CAISO) to describe resources that can be delivered reliably to customers during periods of high demand or congestion on the grid. Other resources can be counted as energy but not as capacity towards resource adequacy requirements; whereas, fully deliverable resources can be counted as capacity. In answer to Commissioner Johnston's question regarding the percentage of current supplies designated as fully deliverable, Stack advised that all resources with the exception of two solar projects are designated as fully deliverable. Staff is working with the developer to have the two solar projects qualified as fully deliverable. Commissioner Johnston commented that the supply chart shows the average cost is 5.9¢ per kilowatt hour (kWh) across the portfolio. The only resource below the average is the Western contract. Removing the Western contract from the portfolio will have a big impact on the overall cost. The EIRP does not detail portfolio rebalancing and replacing existing resources with resources that more closely match load. Staff will work on making the Western contract more favorable while concurrently identifying resources to replace the Western contract. Stack recalled that staff analyzed portfolio rebalancing earlier in the year and discussed the analysis with the UAC in more detail than was presented in the EIRP. Staff felt the analysis was not what the CEC wanted in the EIRP and did not include it. Vice Chair Schwartz did not feel a goal of 90% adoption of electric vehicles (EV) was realistic as CPAU cannot control residents' behavior. Ed Shikada, Utilities General Manager, explained that the target came from the Sustainability and Climate Action Plan (S/CAP) and agreed to characterize it as an aspirational goal. Staff's efforts will focus on facilitating market adoption of EVs. Vice Chair Schwartz believed that the cost of incentives would be enormous. Chair Danaher noted the projection for the cost of EVs to decrease by 2025. Vice Chair Schwartz stated the goal is unrealistic even if EV costs decrease. If EV adoption is part of the plan, then staff has to include incentives or set a realistic goal. Chair Danaher clarified that the goal does not indicate whether adoption of EVs pertains to new cars or the City fleet. Charging networks are one component of a plan to incentivize EV adoption. Abendschein advised that the list of goals was taken from other City documents. When the S/CAP returns for discussion, the Commission can discuss the goal of 90% adoption of EVs. Stack added that the EIRP assumes 40% of residential customers will adopt EVs. Chair Danaher commented that 40% was the percentage of new electric and hybrid vehicles in Palo Alto. Schwartz expressed that a goal of 40% is ambitious without providing incentives. In answer to Vice Chair Schwartz's query regarding whether the power supply charts reflect actual purchases, Stack responded no, the charts reflect net purchases, not gross purchases. Vice Chair Schwartz felt the 2018 chart is misleading in that it reflects no thermal purchases. Stack advised that the carbon accounting discussion would include the question of how to accurately reflect purchases. Vice Chair Schwartz suggested the EIRP include a discussion of time -varying rates enabled by advanced metering infrastructure (AMI) because AMI can provide price signals to incentivize desired behaviors, which would justify the Finance Committee's support for investing in AMI. Stack reported a discussion of time -varying rates is included in the Distributed Energy Resources (DER) Plan. Abendschein added that the EIRP pertains Utilities Advisory ConTrission Mnutes Approved on: Page 2 of 3 to supply. The distributed resources needed to substitute for electric supply are acknowledged in the EIRP, but the details are in the DER Plan. Vice Chair Schwartz was referring to varying rates as providing incentives for people to use less energy. A large portion of the population needs a financial reason to use electricity at specific times. In reply to Vice Chair Schwartz's inquiry regarding the percentage of the population participating in the Residential Energy Assistance Program (REAP), Abendschein answered a fairly low percentage. He could provide the exact percentage at a later time. Vice Chair Schwartz suggested CPAU offers electricity at lower rates than PG&E because 40% of PG&E customers participate in PG&E's care plan. She wanted to know the resources that could replace Western hydroelectric power. She wanted staff to explain fully and realistically the idea of carbon -neutral resources so that the City Council and the public can understand the need for investment. In response to Commissioner Forssell's suggestion that the EIRP essentially provides a strategy to answer a set of specified questions, Abendschein concurred that the EIRP is a problem statement, an acknowledgement of the strategic questions for staff to focus on in the next several years. In reply to Commissioner Forssell's question of whether the Western contract projections are placeholders for carbon - neutral energy to be determined rather than a commitment to continue the contract, Stack replied that the projections are placeholders rather than a commitment. The default scenario assumes the continuation of the Western contract. Commissioner Forssell commended staff for identifying key issues and questions and ways to think about them. Chair Danaher related that the EIRP content is meant to comply with regulatory requirements and to identify areas of future work. At some point, staff should integrate some of the issues with the Commission's calendar. Chair Danaher acknowledged Vice Chair Schwartz's point about staff tracking and reporting fossil fuel purchases. ACTION: Vice Chair Schwartz moved that the Utilities Advisory Commission (1) finds that the 2018 EIRP report is not a project as defined in Public Resources Code 21065 and, therefore, California Environmental Quality Act (CEQA) review is not required and (2) recommends that the Finance Committee recommend that the City Council adopt a Resolution to approve the 2018 Electric Integrated Resource Plan (EIRP), Updated Renewable Portfolio Standard Procurement Plan and Enforcement Program, and related documents. Commissioner Johnston seconded the motion. The motion carried 6-0 with Chair Danaher, Vice Chair Schwartz, and Commissioners Forssell, Johnston, Segal, and Trumbull voting yes, and Commissioner Ballantine absent. Utilities Advisory Commission Minutes Approved on: Page 3 of 3 ATTACHMENT F CITY OF PALO ALTO Fl NANCE COMMI TTEE ACTI ON MINUTES Special Meeting October 16, 2018 Chairperson Scharff called the meeting to order at 6:08 P.M. in the Community Meeting Room, 250 Hamilton Avenue, Palo Alto, California. Present: Vice Mayor Filseth, Kou, Scharff (Chair), Tanaka Absent: 1. Utilities Advisory Commission Recommendation That the Finance Committee Recommend the City Council Adopt a Resolution Approving the 2018 Electric Integrated Resource Plan (El RP), Updated Renewable Portfolio Standard Procurement Plan and Enforcement Program, and Related Documents. Dean Batchelor, Utilities Chief Operating Officer announced that Staff would be presenting the 2018 Electric Integration Resource Plan (EIRP). He announced that Staff's recommendation was to move the EIRP forward to City Council (Council) for approval. The current plan was adopted in April of 2012 and then in 2015 Senate Bill (SB) 350 was signed into law which required that all Cities falling within a certain criterion come up with a new El RP Plan. Once the El RP Plan is adopted, Staff would present the plan to the California Energy Commission by January 2019. Shiva Swaminathan, Senior Resources Planner stated that the plan was reviewed and implemented every 5 years. The proposed EIRP would be implemented between 2018 and 2030. Three reasons the EIRP Plan is important is it included the Western Hydro Contract which met 38 percent of Palo Alto's (City) energy needs and that contract was going to expire in 2024. The City had ambitious goals for renewable supplies of energy and there was a rapid increase in distributed energy resources. SB 350 stated that City's were to increase the renewable supply of electric supply to 50 percent by 2030, reduce greenhouse gas and emissions by 40 percent, and then double the energy efficiency saving. There were two requirements for SB 350 that the City needed to work on which were doubling the energy efficiency. Page 1 of 5 FINAL MI NUTES Chair Scharff interjected stating that could the City be having trouble doubling because it was so energy efficient. Mr. Swaminathan confirmed that was correct. Jonathan Abendschein, Assistant Director Utilities Resource Management noted that energy efficiency did not just refer to utility energy, it was a doubling of state-wide efficiency. Mr. Swam inathan continued that the second area of focus for the City was to enhance the distribution system for demand -side management programs. Some accomplishments that the City was successful achieved since 2012 was a Carbon Neutral Plan, increased the Renewable portfolio standard to 58 percent, a cumulative energy savings of 4.4 percent over 6 years, and several other noteworthy accomplishments. On an annual basis, solar and Western energy took up most of the Cities energy. Vice Mayor Filseth wanted to know why Calaveras was more expensive than Western when looking at the projections of where the City's energy loads would be in 2025. Mr. Swaminathan answered that the debt service for Calaveras would go away in 2032 and so the cost would go down after that. Chair Scharff questioned if the City would then keep the Calaveras reserve account forever. Mr. Swaminathan stated that the use of the reserve would need to be reviewed regularly. Vice Mayor Filseth reiterated that Western was $.03 a kilowatt hour on average currently, not including transmission costs. Mr. Swam inathan responded that was correct. Vice Mayor Filseth wanted to know how active the City was when it came to looking at storage for solar energy. Page 2 of 5 Sp. Finance Committee Meeting Final Minutes 10/16/18 FINAL MI NUTES Mr. Swaminathan explained that looking at solar energy storage was incorporated into the new EIRP Plan. Prices for solar energy storage was declining rapidly but still expensive. Council Member Kou inquired about the licensing cost for Calaveras and what the approximate cost was. Mr. Swaminathan stated Palo Alto was a 22 percent share owner of the project so it was roughly $10 million. Mr. Abendschein restated that the City's share was roughly $50 million for relicensing and that was amortized over many years. Annually, the City paid roughly $8 million for Calaveras. Mr. Swaminathan continued that due to Distributed Energy Resources increasing, that was decreasing the electricity load by 2 percent. In the next 3 to 4 years Staff planned on implementing seven new initiatives in the EIRP Plan. The new initiatives included being involved in the Western Contract decision, portfolio rebalancing analysis, California Oregon Transmission Project (COTP) decision, carbon accounting, RPS compliance strategy, partner with external agencies, and competitive assessment and loading uncertainty. Chair Scharff asked why the City would want to investigate and partner with external agencies. Mr. Swaminathan explained that the City could learn about solar storage projects and customer programs. He explained that in terms of next steps Staff was looking for a recommendation from the Finance Committee to the Council to approve the EIRP Plan. Once Staff received approval from the Council they would file the EIRP Plan with the State in April of 2019. In 2024 the contract between the City and Western will need to be renewed. Then a new El RP Plan will be presented to the Committee and Council in the year 2024. Council Member Kou questioned what stranding assets meant. Mr. Swaminathan responded that it meant the cost of owning an asset was greater than the market value of the asset. Page 3 of 5 Sp. Finance Committee Meeting Final Minutes 10/16/18 FINAL MI NUTES Chair Scharff requested more information about the California Oregon Transmission Project. Mr. Swaminathan stated that the project had been in place for the past 25 years but it was not being used at the present time. He stated that when the contract with Western is up for renewal in 2024, the COTP will again be utilized by the City. The debt associated with the COTP will be gone in 2024 so the project would be a good resource. Council Member Tanaka wanted to know if there were any benefits to the City if it had energy storage. Mr. Swaminathan articulated that if the price was right then energy storage could be valuable. Council Member Tanaka questioned if it made sense for the City to invest money into pumped -hydro water dams as energy storage units. Mr. Swaminathan explained that pumped hydro was not an open market and it could be very expensive. Also, the geography was not readily available to be able to achieve the pumping of water backward to build up energy. Mr. Abendschein added that pumped hydro could be one of the alternatives that Staff could explore in the next 5 years as an option for energy storage. Council Member Tanaka articulated that the Cities of Springfield and Riverside were using derivatives to try to balance out the supply. He wanted to know if Staff had looked at that idea further. Mr. Abendschein voiced that Staff had investigated the idea thoroughly in 2017 with the Hydro -Electric Rate Adjuster. The energy portfolio was largely hedged because of the long-term contracts that the City held. In the winter months, the City did use a hedging program. MOTI ON: Vice Mayor Filseth moved, seconded by Council Member Kou to recommend the City Council: A. Adopt a Resolution to approve the following: i. The 2018 Electric Integrated Resource Plan (El RP); Page 4 of 5 Sp. Finance Committee Meeting Final Minutes 10/16/18 FINAL MI NUTES ii. An updated Renewable Portfolio Standard (RPS) Procurement Plan; i ii . An updated RPS Enforcement Program; iv. The following four standardized tables: a. Capacity Resource Adequacy Table (CRAT); b. Energy Balance Table (EBT); c. Greenhouse Gas (GHG) Emissions Accounting Table (GEAT); d. RPS Procurement Table (RPT); and B. Approve the El RP Objective and Strategies to guide future analysis and decisions; and C. Approve the EIRP Work Plan outlining planned staff initiatives to implement the EIRP. MOTI ON PASSED: 4-0 Page 5 of 5 Sp. Finance Committee Meeting Final Minutes 10/16/18 CITY OF PALO ALTO City of Palo Alto (ID # 9690) City Council Staff Report Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: Utility Trench & Substructure 2019-2022 Title: Approval and Authorization of the City Manager to Execute a Construction Contract with MP Nexlevel of California, Inc. in the Amount of $6,145,494 for Trenching and Substructure Installation and Materials, and a 10% Contingency of $614,549 for Related but Unforeseen Work, for a Total Authorized Amount of $6,760,043 Over Three Years From: City Manager Lead Department: Utilities Recommendation Staff recommends that Council: 1. Approve and authorize the City Manager or his designee to execute a construction contract with MP Nexlevel of California, Inc. (Attachment A) in the amount of $5,645,494 to provide utility trenching and substructure installation, labor and equipment for a period of thirty-six (36) months. 2. Approve and authorize the City Manager or his designee to purchase materials in the amount of $500,000 related to the utility trenching and substructure installation to be performed by MP Nexlevel of California, Inc. 3. Approve and authorize the City Manager or his designee to negotiate and execute one or more change orders to the contract with MP Nexlevel of California, Inc. for related, but unforeseen work which may develop during the contract term, the total value of which shall not exceed $614,549 or 10% of total contract. Staff is requesting an authorized amount of $6,760,043 to cover the three-year contract term for labor and equipment ($5,645,494), purchase of related materials ($500,000), and a 10% contingency ($614,549) on labor, equipment, and material. Background Electric substructure installation and trenching services are contracted out because the City does not have qualified staff to perform this work. The volume of substructure and trenching City of Palo Alto Page 1 services varies year over year based on the level of construction and development activities in the City. Staff establishes a multi -year contract with a general contractor to provide trenching and excavation services, and to install electric utility substructures such as conduits, boxes, and vaults on an as needed basis. This is for work that is smaller in scale than typical utility infrastructure projects, and does not warrant going out for bid and approval on its own (typically work ranges from $2,000 to $100,000). The trenching and substructures are for a variety of customer service installations, replacement of existing underground electric system equipment, and for fiber optic, street light, and communication services. Staff creates a scope of work each time the contractor's services are needed, and the contractor provides a 'not to exceed' quote. Staff must authorize the work prior to the start of construction. Payment is made upon completion of the work, and acceptance by the City, and is only for the contractor's actual costs. For customer -related work, trenching and substructure costs are reimbursed by the customers through the customer connection charges. These costs do not contribute to general electric ratepayer expenses. Project completion retention is not held for these projects as they have a limited scope of work and construction duration, and tracking and billing would pose an administrative challenge. The existing three-year trenching and substructure contract with Lewis & Tibbitts is scheduled to end in January 2019. Discussion The City does not possess the staff resources to provide electric substructure installation and trenching services. Electric substructure and trenching services have been contracted out by the City for over 25 years. Award of the contract is necessary to complete electric and fiber optic capital improvement projects in a timely and cost-effective manner. These services are also occasionally used for maintenance work included in the Operating Budget. Summary of Bid Process Bid Name/Number 2019-2022 Utility Trench & Substructure Installation/IFB 172625 Proposed Length of Project 36 months Number of Bids Mailed to Contractors 480 Number of Bids Mailed to Builder's Exchanges 10 Total Days to Respond to Bid 14 Pre -Bid Meeting? Yes Number of Company Attendees at Pre -Bid Meeting 8 Number of Bids Received: 5 Bid Price Range From a low of $5,645,494 to a high of $8,264,279. *Bid summary provided in Attachment B. Staff has reviewed all bids submitted and recommends that the bid of $5,645,494 submitted by MP Nexlevel of California, Inc. (MP Nexlevel) be accepted and that MP Nexlevel be declared the lowest responsible bidder. The bid is 17% above the staff engineer's estimate of $4,800,000. Staff's estimate was based on the previous contract for this work adjusted for added quantities City of Palo Alto Page 2 and labor escalation. For example, staff changed the scope of the contract to reflect actual construction activities performed under the most recent contract such as increasing or decreasing number of hours for a skilled worker (i.e. foreman, equipment operator, truck driver) and types of equipment (i.e. dump truck, directional boring rig). Though the cost of equipment provided by MP Nexlevel was less than the previous bid, the labor costs increased by 35% due to high demand for construction workers and increasing market wages, thus resulting in the 17% difference between the staff estimate and bid. The Bids were for labor and equipment costs only. Materials were not included as a bid item since they will be supplied by either the City or the Contractor, depending on the type of material required. The estimated cost of contractor supplied materials is $500,000 and is based on prior year's actuals. The full contract amount requested is $6,145,494, which is MP Nexlevel's bid price for labor and equipment, plus $500,000 for materials. Staff confirmed with the Contractor's State License Board that the contractor has an active license on file. Staff checked references supplied by the contractor for previous work performed and found no significant complaints. The work by the contractor will be continually monitored and evaluated. Continued work under this contract for FY 2020 and FY 2021 will be subject to satisfactory performance by the contractor and appropriation of required funds in the respective fiscal years. Resource Impact Funding for this contract will be appropriated over the next three fiscal years based on Council approval of the Electric and Fiber Optic Capital Budgets. The first year funds are available in the FY 2019 Capital Budget, and $2,595,714 of the total contract amount will be allocated to the following: Electric Customer Connections (EL -89028, 44%); Electric System Improvement (EL - 98003, 44%); Fiber Optic Customer Connections (FO -10000, 4%) and Fiber Optic System Improvement (FO -10001, 8%). The cost allocation is based on projected CIP construction work for the Electric and Fiber fund over the next three years. Staff is requesting approval of the full 10% contingency of $614,549 to address some backlogged projects and cover any unforeseen conditions. Contract Distribution by Fiscal Year Description FY 2019 FY 2020 FY 2021 Total Labor and Equipment $1,815,165 $1,915,164 $1,915,165 $5,645,494 Materials $166,000 $167,000 $167,000 $500,000 Contingency $614,549 $614,549 Total $2,595,714 $2,082,164 $2,082,165 $6,760,043 City of Palo Alto Page 3 Contract Distribution by Project (WBS) Project Split FY 2019 FY 2020 FY 2021 Total EL -89028 — Elec Cust Conn 44% $1,147,857 $891,082 _ $891,083 $2,930,022 EL -98003 — Elec Sys Impry 44% $1,147,857 $891,082 $891,082 $2,930,021 FO -10000 — Fiber Cust Conn 4% $100,000 $100,000 $100,000 $300,000 FO -10001 — Fiber Sys Impry 8% $200,000 $200,000 $200,000 $600,000 Total $2,595,714 $2,082,164 $2,082,165 $6,760,043 Policy Implications The approval of this contract is consistent with existing City policies including the Council - approved Utilities Strategic Plan -Strategic Objectives: Priority 4 to manage finances optimally & use resources efficiently, and specifically Strategy 4, Action 2 to balance customer rates and service with infrastructure improvements and maintenance. Environmental Review This project is categorically exempt from the California Environment Quality Act (CEQA) under Public Resources Code sections 15301 (repair or maintenance of existing facilities) and 15302 (replacement or reconstruction of existing facilities). Attachments: • Attachment A: C19172625 Contract UTL Trench and Substructure • Attachment B: Bid Summary City of Palo Alto Page 4 ATTACHMENT A CITY OF PALO ALTO CONSTRUCTION CONTRACT Contract No. C19172625 City of Palo Alto "Utility Trench & Substructure Project 2019-2021" Invitation for Bid (IFB) Package CONSTRUCTION CONTRACT 1 Rev. March 17, 2017 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 2 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 3 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 4 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 5 Rev. March 17, 2017 CONSTRUCTION CONTRACT CONSTRUCTION CONTRACT THIS CONSTRUCTION CONTRACT entered into on December 3, 2018 ("Execution Date") by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("City"), and MP NEXLEVEL OF CALIFORNIA, INC. ("Contractor"), is made with reference to the following: RECITALS: 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 Minnesota, Contractor's License Number 907019 and Department of Industrial Relations Registration Number 1000010357. 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 August 8, 2018, City issued an Invitation for Bids (IFB) to contractors for the "Utility Trench & Substructure Project 2019-2021" ("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 "Utility Trench & Substructure Project 2019-2021" Project, located at various locations in Palo Alto, CA. ("Project"). Invitation for Bid (IFB) Package 6 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 7 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 within thirty-six (36) months after the commencement date specified in City's Notice to Proceed. 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 the Contract Time, including any approved extensions thereto, City may assess liquidated damages on a daily basis for each day of Unexcused Delay in achieving Substantial Completion, based on the amount of 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 recover the balance from Invitation for Bid (IFB) Package 8 Rev. March 17, 2017 CONSTRUCTION CONTRACT Contractor or its sureties. Occupancy or use of the Project in whole or in part prior to Substantial Completion, shall not operate as a waiver of City's right to assess liquidated damages. 6.4.1 Other Remedies. City is entitled to any and all available legal and equitable remedies City may have where City's Losses are caused by any reason other than Contractor's failure to achieve Substantial Completion of the entire Work within the Contract Time. 6.5 Adjustments to Contract Time. The Contract Time may only be adjusted for time extensions approved by City and memorialized in a Change Order approved in accordance with the requirements of the Contract Documents. SECTION 7 COMPENSATION TO CONTRACTOR. 7.1 Contract Sum. Contractor shall be compensated for satisfactory completion of the Work in compliance with the Contract Documents for the not to exceed Contract Sum of Five Million Six Hundred Forty -Five Thousand Four Hundred Ninety Four Dollars ($5,645,494.00). 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 9 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 10 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: Copy to: ❑ City of Palo Alto City Clerk 250 Hamilton Avenue P.O. Box 10250 Palo Alto, CA 94303 City of Palo Alto Public Works Administration 250 Hamilton Avenue Palo Alto, CA 94301 Attn: AND [Include Construction Manager, If Applicable.] Invitation for Bid (IFB) Package 11 Rev. March 17, 2017 CONSTRUCTION CONTRACT IZI City of Palo Alto Utilities Engineering 250 Hamilton Avenue Palo Alto, CA 94301 Attn: Ramandeep Kaur 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: MP Nexlevel of California, Inc. 500 County Road 37 East Maple Lake, MN 55358 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 12 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 Invitation for Bid (IFB) Package 13 Rev. March 17, 2017 CONSTRUCTION CONTRACT liable for any additional cost incurred by City to complete the Work following termination. In addition, City shall have the right to use any materials, supplies, and equipment belonging to Contractor and located at the Worksite for the purposes of completing the remaining Work. 15.3 Damages to City. 15.3.1 For Contractor's Default. City will be entitled to recovery of all Losses under law or equity in the event of Contractor's default under the Contract Documents. 15.3.2 Compensation for Losses. In the event that City's Losses arise from Contractor's default under the Contract Documents, City shall be entitled to deduct the cost of such Losses from monies otherwise payable to Contractor. If the Losses incurred by City exceed the amount payable, Contractor shall be liable to City for the difference and shall promptly remit same to City. 15.4 Suspension by City 15.4.1 Suspension for Convenience. City may, at any time and from time to time, without cause, order Contractor, in writing, to suspend, delay, or interrupt the Work in whole or in part for such period of time, up to an aggregate of fifty percent (50%) of the Contract Time. The order shall be specifically identified as a Suspension Order by City. Upon receipt of a Suspension Order, Contractor shall, at City's expense, comply with the order and take all reasonable steps to minimize costs allocable to the Work covered by the Suspension Order. During the Suspension or extension of the Suspension, if any, City shall either cancel the Suspension Order or, by Change Order, delete the Work covered by the Suspension Order. If a Suspension Order is canceled or expires, Contractor shall resume and continue with the Work. A Change Order will be issued to cover any adjustments of the Contract Sum or the Contract Time necessarily caused by such suspension. A Suspension Order shall not be the exclusive method for City to stop the Work. 15.4.2 Suspension for Cause. In addition to all other remedies available to City, if Contractor fails to perform or correct work in accordance with the Contract Documents, City may immediately order the Work, or any portion thereof, suspended until the cause for the suspension has been eliminated to City's satisfaction. Contractor shall not be entitled to an increase in Contract Time or Contract Price for a suspension occasioned by Contractor's failure to comply with the Contract Documents. City's right to suspend the Work shall not give rise to a duty to suspend the Work, and City's failure to suspend the Work shall not constitute a defense to Contractor's failure to comply with the requirements of the Contract Documents. 15.5 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 14 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, Invitation for Bid (IFB) Package 15 Rev. March 17, 2017 CONSTRUCTION CONTRACT submittals of as -built drawings, instructions, or manuals, or other such rights and obligations arising prior to the termination date. SECTION 16 CONTRACTOR'S RIGHTS AND REMEDIES. 16.1 Contractor's Remedies. Contractor may terminate this Construction Contract only upon the occurrence of one of the following: 16.1.1 For Work Stoppage. The Work is stopped for sixty (60) consecutive Days, through no act or fault of Contractor, any Subcontractor, or any employee or agent of Contractor or any Subcontractor, due to issuance of an order of a court or other public authority other than City having jurisdiction or due to an act of government, such as a declaration of a national emergency making material unavailable. This provision shall not apply to any work stoppage resulting from the City's issuance of a suspension notice issued either for cause or for convenience. 16.1.2 For City's Non -Payment. If City does not make pay Contractor undisputed sums within ninety (90) Days after receipt of notice from Contractor, Contractor may terminate the Construction Contract (30) days following a second notice to City of Contractor's intention to terminate the Construction Contract. 16.2 Damages to Contractor. In the event of termination for cause by Contractor, City shall pay Contractor the sums provided for in Paragraph 15.5.1 above. Contractor agrees to accept such sums as its sole and exclusive compensation and agrees to waive any claim for other compensation or Losses, including, but not limited to, loss of anticipated profits, loss of revenue, lost opportunity, or other consequential, direct, indirect and incidental damages, of any kind. SECTION 17 ACCOUNTING RECORDS. 17.1 Financial Management and City Access. Contractor shall keep full and detailed accounts and exercise such controls as may be necessary for proper financial management under this Construction Contract in accordance with generally accepted accounting principles and practices. City and City's accountants during normal business hours, may inspect, audit and copy Contractor's records, books, estimates, take -offs, cost reports, ledgers, schedules, correspondence, instructions, drawings, receipts, subcontracts, purchase orders, vouchers, memoranda and other data relating to this Project. Contractor shall retain these documents for a period of three (3) years after the later of (i) Final Payment or (ii) final resolution of all Contract Disputes and other disputes, or (iii) for such longer period as may be required by law. Invitation for Bid (IFB) Package 16 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 17 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. 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 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. Invitation for Bid (IFB) Package 18 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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: "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. Invitation for Bid (IFB) Package 19 Rev. March 17, 2017 CONSTRUCTION CONTRACT 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: (1) 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. (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. Invitation for Bid (IFB) Package 20 Rev. March 17, 2017 CONSTRUCTION CONTRACT PI City requests Contractor and its listed subcontractors to submit the certified payroll records to the project manager at the end of each week during the Project. (iv) If the certified payroll records are not produced to the project manager within the 10 -day period, then Contractor and its listed subcontractors shall be subject to a penalty of one hundred dollars ($100.00) per calendar day, or portion thereof, for each worker, and City shall withhold the sum total of penalties from the progress payment(s) then due and payable to Contractor. This provision supplements the provisions of Section 15 hereof. (v) Inform the project manager of the location of contractor's and its listed subcontractors' payroll records (street address, city and county) at the commencement of the Project, and also provide notice to the project manager within five (5) business days of any change of location of those payroll records. IN WITNESS WHEREOF, the parties have caused this Construction Contract to be executed the date and year first above written. CITY OF PALO ALTO City Manager or designee APPROVED AS TO FORM: City Attorney or designee MP NEXLEVEL OF CALIFORNIA, INC. Officer 1 By: Name: Title: Date: Officer 2 By: Name: Title: Date: Invitation for Bid (IFB) Package 21 Rev. March 17, 2017 CONSTRUCTION CONTRACT ATTACHMENT B Casey Lewis & Tibbitts MPN Ve Bid Item Approx Qty Description Unit Price Extended Price Unit Price Extended Price Unit Price Extended Price Unit Price Extended Price Unit Price Extended Price 1 2800 Foreman 190 $532,000 112.8 $315,840 122 $341,600.00 122.81 $343,868 134.64 $376,992 2 8000 Laborer 120 $960,000 86.1 $688,800 85 $680,000.00 91.22 $729,760 97.77 $782,160 3 2800 Equipement Operator 140 $392,000 112.8 $315,840 117 $327,600.00 121 $338,800 106.7 $298,760 4 200 Truck Drvier 170 $34,000 111.8 $22,360 82 $16,400.00 101.15 $20,230 102.25 $20,450 5 50 Qualified journeyman worker to perform conduit intercepts in an 140 $7,000 112.8 $5,640 85 $4,250.00 128.37 $6,419 230.05 $11,503 6 300 Concrete Finisher 130 $39,000 89.2 $26,760 96 $28,800.00 134.51 $40,353 97.77 $29,331 7 50 Core Driller with Operator 80 $4,000 98.3 $4,915 300 $15,000.00 106.31 $5,316 107.2 $5,360 8 150 Concrete Saw with Operator 200 $30,000 159.7 $23,955 300 $45,000.00 100.6 $15,090 109.8 $16,470 9 2800 Foreman's Truck 20 $56,000 21.2 $59,360 12 $33,600.00 12.11 $33,908 18 $50,400 10 2800 Crew Truck with Hand Tools and Gas Powered Cutoff Saw 40 $112,000 48.9 $136,920 20 $56,000.00 18.9 $52,920 37 $103,600 11 1400 Compressor and Jackhammer 20 $28,000 26.7 $37,380 25 $35,000.00 13.45 $18,830 18 $25,200 12 1400 Backhoe 60 $84,000 38.1 $53,340 80 $112,000.00 27.12 $37,968 40 $56,000 13 50 Ramhoe 100 $5,000 20.6 $1,030 44 $2,200.00 36.32 $1,816 52 $2,600 14 2800 Bobtail Truck 60 $168,000 31.8 $89,040 27 $75,600.00 50.62 $141,736 40 $112,000 15 50 End -Dump Truck 100 $5,000 48.3 $2,415 85 $4,250.00 56.7 $2,835 105 $5,250 16 150 10 -wheel Dump Truck 100 $15,000 40.6 $6,090 70 $10,500.00 32.98 $4,947 69 $10,350 17 50 Boom Truck with Flatbed 200 $10,000 60.2 $3,010 75 $3,750.00 53.33 $2,667 80 $4,000 18 50 Directional Boring Rig 500 $25,000 825.6 $41,280 800 $40,000.00 165.73 $8,287 198 $9,900 19 50 Arrow Board 50 $2,500 6.4 $320 20 $1,000.00 2.58 $129 14 $700 20 200 Vac Trailer - 800 Gallons 150 $30,000 38.1 $7,620 49 $9,800.00 21.21 $4,242 50 $10,000 21 900 Mini Excavator 60 $54,000 48.3 $43,470 32 $28,800.00 15.41 $13,869 40 $36,000 22 200 Bobcat Skid -Steer 30 $6,000 38.1 $7,620 36 $7,200.00 21.21 $4,242 37 $7,400 23 1000 Equipment Trailer 20 $20,000 19.1 $19,100 7 $7,000.00 5.2 $5,200 15 $15,000 24 150 A/C Roller 20 $3,000 24.8 $3,720 60 $9,000.00 20.27 $3,041 35 $5,250 $2,621,500 $1,915,825 $1,894,350.00 $1,836,471 $1,994,676 $2,752,575 $1,982,879 $1,960,652.25 $1,881,464 $2,074,463 $2,890,204 $2,052,280 $2,029,275.08 $1,927,560 $2,157,441 $8,264,279 $5,950,98' $5,645,494 CITY of City of Palo Alto (ID # 9795) PALO ALT© City Council Staff Report Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: Development Impact Fees Exemption for JADUs and ADU Garage Conversions Title: Adoption of an Ordinance Amending Palo Alto Municipal Code (PAMC) Title 16, Chapters 16.58 (Development Impact Fees), 16.59 (Citywide Transportation Impact Fees), and 16.60 (Charleston Arastradero Corridor Pedestrian and Bicyclist Safety Impact Fee) to Add Development Impact Fee Exemptions for Junior Accessory Dwelling Units and Certain Accessory Dwelling Units Established by Garage Conversion From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that the City Council adopt an Ordinance (Attachment A) amending the Palo Alto Municipal Code to exempt junior accessory dwelling units and garage -conversion accessory dwelling units from development impact fees. Background On October 1, 2018, the City Council reviewed and approved on first reading a draft ordinance amending various elements of Palo Alto Municipal Code (PAMC) Section 18.42.040, Accessory and Junior Accessory Dwelling Units (staff report #9631). As part of the motion, Council directed the elimination of development related impact fees for Junior Accessory Dwelling Units (JADUs) and those Accessory Dwelling Units (ADUs) comprised solely of a converted detached garage. In order to implement Council direction, three Chapters of Title 16 (Building Regulations), require amendments, specifically Chapter 16.58 which established development impact fees for libraries, parks, community centers, public safety facilities, and general government facilities, Chapter 16.59 which established a citywide transportation impact fee, and Chapter 16.60 which established an impact fee to fund bicycle and pedestrian safety improvements in the Charleston Arastradero area. The attached draft Ordinance includes the revised code language. City of Palo Alto Page 1 Discussion For almost all new development in the City, payment of development impact fees by the developer is required. The relevant impact fees that apply to ADUs and JADUs are listed in Table 1 below. The purpose of charging and collecting impact fees is to fund and allow the City to make improvements to City facilities, services, and infrastructure, in order to address the impacts and growing demands of new development. For all accessory dwelling units that are outside the Charleston Arastradero impact fee area, which is the majority of units, the total impact fee per unit is $9,669; with the Charleston Arastradero fee included, the total is $10,749 per unit. Table 1: Summary of Impact Fees for ADUs/JADUs1 Description Amount (per unit) Development Impact Fees (PAMC 16.58) Parks $4,082 Community Centers $1,062 Public Safety Facilities $ 858 General Government Facilities $1,080 Libraries $ 367 Citywide Transportation (PAMC 16.59) $2,220 Charleston Arastradero Traffic (PAMC 16.60) $1,080 Proposed Development Impact Fee Waiver Depending on the fee, the current code includes a list of eight to nine project types that are exempt from the respective fees (i.e. Development Impact Fees, Citywide Transportation, and Charleston Arastradero Traffic). With only a few exceptions, the list of exempt project types are the same for all three general fee categories. Some examples of exempt project types inlcude: • City buildings or structures. • Public school buildings or structures. • Affordable housing, either for sale or rental, which, by recordable means, is permanently obligated to be 100% affordable. • Retail service, eating and drinking service, personal service, or automotive service when the total square footage (including new development) is 1,500 square feet or less. • Day care centers used for childcare, nursery school or preschool education. • Below market rate housing units above and beyond the minimum number required for projects subject to the city's below market rate (BMR) housing program. 1 These fee amounts are from the FY 2019 Municipal Code Fee Schedule. City of Palo Alto Page 2 Following Council direction, the proposed ordinance would amend PAMC Sections 18.58.030, 16.59.040, and 16.60.040, which list the project exemptions for the respective development impact fees, to include this added language (see Attachment A for details): • Accessory dwelling units (ADU) established by the conversion of an existing detached garage, provided that the existing detached garage was legally constructed, or received building permits, as of January 1, 2017, and is converted to an ADU with no expansion of the existing building envelope. • Junior accessory dwelling units (JADU). In addition to exempting JADUs and a subset of ADUs from impact fees as noted in this report, Council also directed staff and the Planning and Transportation Commission to study the financial implications of waiving impact fees for all ADU development. Policy Implications The proposed ordinance is consistent with the Comprehensive Plan provisions and would advance related housing element programs. The Comprehensive Plan emphasizes the importance of the City's residential neighborhoods and the quality of life for residents. Policy L- 2.3 of the Land Use and Community Design Element emphasizes the need to allow and encourage diversity of the City's housing stock and supports ADU development. Additionally, the Housing Element provides specific goals and programs to encourage ADU development. Goal H1 directs the preservation of the unique character of the city's residential neighborhoods and Programs H1.1.2 and H3.3.5 encourage modifying existing second unit development standards in order to facilitate the creation of additional ADUs while maintaining neighborhood character and increasing the City's affordable housing supply. Resource Impact The proposed ordinance would eliminate the collection of impact fees, as discussed above. As mentioned earlier, the typical amount of development impact fees collected for a new accessory living unit is $9,669. The elimination of impact fees for JADUs is not expected to have much, if any, fiscal impact, since the City has yet to receive a permit for this unit type. For the detached garage -conversion ADU, which is a common ADU type and represents about 35%2 of the permits filed in 2018, the City received approximately 20 applications since the updated ADU regulations became effective in January 2017. Based on current fees, these 20 applications are equivalent to approximately $193,380 in development impact fees. Council's direction to waive these fees indicates that supporting development of these types of housing units is a higher priority than collecting the related impact fees. 2 At the time of report preparation, the City received 45 ADU permits for 2018, of which, 16 (35%) are detached garage conversions and would qualify for the proposed impact fee waiver. City of Palo Alto Page 3 Timeline With Council approval of these revisions or further modifications on the first reading, the second reading would be scheduled as a consent calendar review for adoption. Following the second reading, the ordinance would become effective 31 days after adoption. Environmental Review The proposed code amendments to exempt JADUs and certain garage -conversion ADUs from paying development impact fees is not considered a "project" under the California Environmental Quality Act (CEQA) and, therefore, no envirnmental analysis is required. Attachments: Attachment A: Ordinance Amending Chapters 16.58, 16.59, 16.60 to Exempt from Development Impact Fees Junior Accessory Dwelling Units and Certain Accessory Dwelling Units (PDF) City of Palo Alto Page 4 Not Yet Approved Ordinance No. Ordinance of the Council of the City of Palo Alto Amending Chapters 16.58 (Development Impact Fees), 16.59 (Citywide Transportation Impact Fee) and 16.60 (Charleston-Arastradero Corridor Pedestrian and Bicyclist Safety Impact Fee) of Title 16 (Building Regulations) of the Palo Alto Municipal Code to Exempt from Development Impact Fees Junior Accessory Dwelling Units and Certain Accessory Dwelling Units Established Through Garage Conversion The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. Findings and Declarations. The City Council finds and declares as follows: A. In 2017, the City Council adopted Ordinance No. 5412 establishing comprehensive regulations related to accessory dwelling units and junior accessory dwelling units in order to comply with State law and to reduce regulatory constraints affecting the production of such units. B. The City Council reaffirms the findings and declarations adopted by Ordinance No. 5412. C. This Ordinance is adopted to further reduce barriers to production of these units by exempting junior accessory dwelling units and certain accessory dwelling units from payment of the City's current development impact fees. SECTION 2. Section 16.58.030 (Exemptions) of Chapter 16.58 (Development Impact Fees) of Title 16 (Building Regulations) of the Palo Alto Municipal Code ("PAMC") is amended to read as follows: 16.58.030 Exemptions The provisions of this chapter shall not apply to the following: (a) City buildings or structures; (b) Public school buildings or structures; (c) Residential housing, either for sale or rental, which, by recordable means, is permanently obligated to be 100% affordable; (d) Retail service, eating and drinking service, personal service, or automotive service when the total additional square footage is 1,500 square feet or less. This exemption shall apply only when the additional square footage of new development does not exceed 1,500 square feet. New development that is larger than 1,500 square feet shall pay a fee for all square footage, including the first 1,500 square feet; (e) Day care centers used for child care, nursery school or preschool education; 2018110601 SL Not Yet Approved (f) Below market rate housing units above and beyond the minimum number required for projects subject to the City's Below Market Rate (BMR) Housing program. The additional units must be offered and constructed in a manner consistent with all requirements of the BMR program; (g) Accessory dwelling units (ADU) established by the conversion of an existing detached garage, provided that the existing detached garage was legally constructed, or received building permits, as of January 1, 2017, and is converted to an ADU with no expansion of the existing building envelope; (h) Junior accessory dwelling units (JADU); (gi) Any residential subdivision for which land dedication or fees in lieu thereof are required pursuant to Chapter 21.50 of the Palo Alto Municipal Code. This exemption shall only apply to the park development fee described in Section 16.58.020(a). SECTION 3. Section 16.59.040 (Exemptions) of Chapter 16.59 (Citywide Transportation Impact Fee) of Title 16 (Building Regulations) of the PAMC is amended to read as follows: 16.59.040 Exemptions The provisions of this chapter shall not apply to: (a) City buildings or structures. (b) Public school buildings or structures. (c) Affordable housing, either for sale or rental, which, by recordable means, is permanently obligated to be 100% affordable. (d) Retail service, eating and drinking service, personal service, or automotive service when the total square footage (including new development) is 1,500 square feet or less. (e) Day care centers used for child care, nursery school or preschool education. (f) Below market rate housing units above and beyond the minimum number required for projects subject to the City's Below Market Rate (BMR) Housing program. The additional units must be offered and constructed in a manner consistent with all requirements of the BMR program. (g) Accessory dwelling units (ADU) established by the conversion of an existing detached garage, provided that the existing detached garage was legally constructed, or received building permits, as of January 1, 2017, and is converted to an ADU with no expansion of the existing building envelope. (h) Junior accessory dwelling units (JADU). 2018110601 SL 2 Not Yet Approved (gi) A change in tenancy that does not result in a change in use and which does not involve either (i) a demolition of an existing structure or (ii) an expansion of square footage of useful area. (hi) New development which is exempt from the fee by virtue of the Constitutions of the United States and California or by virtue of other applicable state or federal law. SECTION 4. Section 16.60.040 (Exemptions) of Chapter 16.60 (Charleston-Arastradero Corridor Pedestrian and Bicyclist Safety Impact Fee) of Title 16 (Building Regulations) of the PAMC is amended to read as follows: 16.60.040 Exemptions The provisions of this chapter shall not apply to: (a) City buildings or structures. (b) Public school buildings or structures. (c) Affordable housing, either for sale or rental, which, by recordable means, is permanently obligated to be 100% affordable. (d) Retail service, eating and drinking service, personal service, or automotive service when the total square footage (including new development) is 1,500 square feet or less. (e) Day care centers used for child care, nursery school or preschool education. (f) Below market rate housing units above and beyond the minimum number required for projects subject to the City's Below Market Rate (BMR) Housing program. The additional units must be offered and constructed in a manner consistent with all requirements of the BMR program. (g) Accessory dwelling units (ADU) established by the conversion of an existing detached garage, provided that the existing detached garage was legally constructed, or received building permits, as of January 1, 2017, and is converted to an ADU with no expansion of the existing building envelope. (h) Junior accessory dwelling units (JADU). (gi) New development which is exempt from the fee by virtue of the Constitutions of the United States and California or by virtue of other applicable state or federal law. SECTION 5. If any section, subsection, clause or phrase of this Ordinance is for any reason held to be invalid, such decision shall not affect the validity of the remaining portion or sections of the Ordinance. The Council hereby declares that it should have adopted the Ordinance and each section, subsection, sentence, clause or phrase thereof irrespective of the fact that any 2018110601 SL 3 Not Yet Approved one or more sections, subsections, sentences, clauses or phrases be declared invalid. SECTION 6. The Council finds that this project is exempt from the provisions of the California Environmental Quality Act ("CEQA"), pursuant to Section 15061 of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that the Ordinance will have a significant effect on the environment. SECTION 7. This Ordinance shall be effective on the thirty-first day after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Mayor APPROVED: Assistant City Attorney City Manager Director of Planning and Community Environment Director of Administrative Services 2018110601 SL 4 CITY OF City of Palo Alto PALO ALTO City Council Staff Report (ID # 9823) Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: Resolution of Support for formation of RHNA Subregion Title: Adoption of Resolution of Support for Formation of a Regional Housing Needs Allocation Subregion for Santa Clara County From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that the City Council adopt a resolution to support the formation of a Regional Housing Needs Allocation (RHNA) Sub -region. Background On September 10, 2018 City Council informally signaled its support (8-1) to participate with Santa Clara County and other cities in the formation of a RHNA subregion'. The subregion would allow local governments and the County to cooperatively re -distribute State mandated regional housing allocations within the region with the intent to better facilitate and implement countywide housing production. The Cities Association of Santa Clara County2 (Cities Association) has received feedback from each of the cities in the County with a clear majority expressing support for moving forward with a subregion. The City Council is being asked to adopt a formal resolution memorializing its non -binding interest to participate in the Cities Association's effort to create the RHNA subregion. RHNA is the process by which the California Department of Housing and Community Development (HCD), in coordination with the jurisdiction's Council of Governments (COG)3, ' For more background on the RHNA subregion and past Council direction see the September 10, 2018 staff report (https://www.cityofpaloalto.org/civicax/filebank/documents/66646) and minutes (https://www.cityofpaloalto.org/civicax/filebank/documents/66646). 2 The Cities Association represents the mutual interests of the 15 cities in Santa Clara County. Through the Cities Association, city leaders network, collaborate, research policy, and work side by side on issues of mutual local interest. More information about the Cities Association is available online: http://citiesassociation.org/ 3 The COG for Palo Alto is the Association of Bay Area Governments (ABAG). City of Palo Alto Page 1 determines a city's share of the regional housing need. HCD, as permitted by the Housing Element Law (Government Code Sections 65580-65589), allows certain combinations of local governments to form a subregion to implement the RHNA process and determine the allocation of housing units among its jurisdictions, instead of the COG. All of this provides a subregion with greater flexibility and local control than the traditional process managed by HCD and the Association of Bay Area Governments (ABAG). Discussion The Cities Association, in an effort to improve the regional housing deficit problem, has actively been discussing the RHNA subregion formation for more than five years. The Cities Association formed a Regional Housing Task Force to study the issue. Over three years, the subcommittee has developed a framework, guiding principles, and process to establish and implement a RHNA subregion. During the discussions, it was emphasized and agreed that this would be a cooperative effort so that no city would be required to implement an action that they did not support. Subregions have been formed for three northern California counties: San Mateo, Napa and Solano Counties. All of the subregions for the three counties included full participation by all the cities in the associated counties. At their June 2018 meeting, the Cities Association recommended a two-step process for the formation of a subregion. • The first step would be for the city councils to discuss the formation of a subregion, which includes review of the pros/cons, the draft Guiding principles, and draft By-laws. For Palo Alto, this occurred on September 10, 2018. • The second step would be for participating cities to adopt a resolution to support the formation. As outlined by the Government Code, an eligible subregion can be formed with each jurisdiction adopting a resolution, identification of a subregion entity (the Cities Association subcommittee for example), adoption of rules and agreement with ABAG/MTC. Once the subregion is formed, the entity would create a methodology, allow for public comment and distribute the allocation. The next RHNA cycle for the housing element will start in 2020. At their October 11 meeting, the executive director of the Cities Association updated the Board of Directors regarding feedback from the cities and county regarding the possible formation of a RHNA subregion. A majority of the cities, 13 out of 16 jurisdictions, had expressed a willingness to form a subregion. Although they have not taken formal action, Santa Clara City of Palo Alto Page 2 County has stated previously that it is also supportive. The cities of Los Altos Hills and Santa Clara have already adopted resolutions of support. The Board voted in favor of moving forward with the formation of a subregion and requested each of the jurisdictions to adopt resolutions in support of the subregion formation. The Cities Association will then reconvene to oversee the process of forming a subregion. Next Steps If the Council adopts a resolution of support of a RHNA subregion, staff will provide a copy of the resolution with Cities Association Board of Directors. Staff will coordinate with the Cities Association as they move forward in the process, including allocation guidelines for the next RHNA cycle in 2020. Policy Implications The proposed actions are consistent with numerous Comprehensive Plan goals and policies that encourage and support housing development, including affordable housing. Resource Impact At this time, the recommended actions are not anticipated to have a significant fiscal impact to the City. Environmental Review The action requested in this report does not constitute a project as defined by the California Environmental Quality Act (CEQA) and no further analysis is required. Attachments: Attachment A: Resolution of Intent to Support Formation of RHNA Subregion within Santa Clara County (PDF) Attachment B: Cities Association RHNA Subregion Background Information (PDF) City of Palo Alto Page 3 NOT YET APPROVED Resolution No. Resolution of the Council of the City of Palo Alto of Intent to Support Formation of a Housing Subregion of Santa Clara County Local Governments to Facilitate and Implement Countywide Housing Production Consistent with the Regional Housing Needs Allocation (RHNA) Formula Currently Assigned by the Association of Bay Area Governments (ABAG) WHEREAS, Housing Element Law (California Government Code Sections 65580 — 65589.8) provides for a Regional Housing Need Allocation (RHNA) process; and WHEREAS, to implement such RHNA process in the San Francisco Bay Area, the State of California has delegated to the Association of Bay Area Governments (ABAG) responsibility to adopt an allocation methodology, then use the adopted methodology to assign to each jurisdiction in the Bay Area the obligation to zone enough housing development capacity to accommodate production of a specific number of housing units during the period from 2023 through 2031; and WHEREAS, Government Code Section 65584.03 provides that certain combinations of local governments may form a subregion to perform RHNA for themselves in order to allocate among themselves the total number of housing units assigned to them collectively by ABAG; and WHEREAS, the City of Palo Alto is interested in exploring the formation of a RHNA subregion consistent with Government Code Section 65584 et seq and acceptable to ABAG and the California Department of Housing and Community Development (HCD) to facilitate collaboration with the county and all cities in the County of Santa Clara, to efficiently and effectively deliver housing production goals; and WHEREAS, the Board of the Cities Association of Santa Clara County (CASCC) has directed the review of the benefits of such a subregion and subsequently representatives of the CASCC have formed a committee to evaluate and make recommendations regarding the importance of and opportunities for success through shared housing strategies which could be facilitated by a subregional effort; and WHEREAS, housing is a countywide challenge, and housing production types, numbers, density, appropriateness and affordability levels can vary in different communities, and the cities within Santa Clara County (collectively, the "Cities") recognize all production types are important to the housing supply of the County and its related economic and social health; and WHEREAS, the Cities are individually accountable for, and retain full local authority for, identifying sites for housing development and for adopting and implementing housing policies intended to facilitate production of housing to meet local, regional and state policy objectives embodied in the numbers prescribed by ABAG in the Sustainable Community Strategy that will be adopted by ABAG and the Metropolitan Transportation Commission (MTC) in 2021; and 1 2018110602 SL NOT YET APPROVED WHEREAS; through mutual cooperation and planning, the production of these housing units may be enhanced through collective efforts and resources, therefore creating a forum for developing countywide policy consensus on matters related to the Sustainable Community Strategy; NOW, THEREFORE, the Council of the City of Palo Alto RESOLVES as follows: SECTION 1. That it is in the best interest of the City to join with other cities in Santa Clara County to explore creation of the RHNA subregion and that by working together to plan for housing growth, the stage is set for implementing housing and more housing will ultimately be built to meet the needs of the entire County and its residents. SECTION 2. That the City Manager is hereby authorized and directed to enter into discussions regarding the formation of a RHNA subregion and the development of a workplan and budget, and schedule of actions leading to the countywide, self -administration of the housing needs allocation process, allocating the countywide total housing needs allocation among all the Cities and unincorporated County by consensus; and to bring back a recommendation and resolution for action to join a RHNA subregion, or in the alternative, an explanation detailing the decision not to participate in the RHNA subregion. SECTION 3. The Council finds that the adoption of this Resolution does not meet the definition of a project under Public Resources Code Section 21065, thus, no environmental assessment under the California Environmental Quality Act is required. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk APPROVED AS TO FORM: Mayor APPROVED: Assistant City Attorney City Manager Director of Planning and Community Environment 2 2018110602 SL Santa Clara County Regional Housing Needs Allocation (RHNA) Subregion Overview What is a RHNA subregion? (Government Code Section 65584.03) In recognition of the common interests and mutual challenges and opportunities associated with providing housing, two or more contiguous cities and a county may form a subregional entity for the purpose of allocation of the subregion's existing and projected need for housing among its members in accordance with the allocation methodology established pursuant to Government Code Section 65584.04. All decisions of the subregion shall be approved by vote as provided for in the rules adopted by the local governments comprising the subregion, or shall be approved by vote of the county and the majority of the cities with the majority of population within the county. What are the steps to create a subregion, following the prescribed timelines in State law? 1. Each participating jurisdiction adopts a resolution indicating its commitment to participating in the subregional entity. 2. For Santa Clara County, the subregional entity could be a committee of the Cities Association with participating cities and the County. 3. The Cities Association (or other entity) would enter into an agreement with the Council of Governments (COG, in our case ABAG/MTC) that sets forth the process, timing, and other terms and conditions of the delegation of responsibility by the COG to the subregion. What does the subregion do, following the prescribe timelines in State law? 1. The subregion determines the methodology for allocating housing need to its participating jurisdictions according to State law (or accepts the methodology factors from the COG as a starting point for further distribution), providing opportunity for public comment and modification prior to adoption of the methodology. 2. The COG allocates a share to the subregion based on a proportion consistent with the distribution of households assumed for the comparable time period of the applicable regional transportation plan. 3. The subregion allocates the distribution of the RHNA to the participating jurisdictions according to the adopted methodology, providing an opportunity for public comment and modification prior to finalizing the distribution. What is the estimated cost of a subregion versus typical participation in the RHNA process? Assuming that the subregion does not hire a consultant to create a separate methodology, the costs would be: 1. Administrating and documenting the subregion meetings and decisions; 2. Conducting the required outreach prior to the subregion making its decisions; 3. Communicating with ABAG/MTC as needed; and 4. Publishing the required notices. The Planning Departments of the participating jurisdictions typically absorb the RHNA evaluation without additional staffing or consultant assistance. 1 Santa Clara County Regional Housing Needs Allocation (RHNA) Subregion Overview What are other activities that the subregion could assume outside of the RHNA process and State law? • Foster collaboration between cities within Santa Clara County o Focus on Measure A implementation o Facilitate an open dialogue between the jurisdictions, public, and interested organizations on housing issues and opportunities o Share best practices regarding rehabilitating existing housing stock, addressing gentrification/displacement, etc. • Work together to obtain and commit more financial resources to affordable housing production o Support for 2018 ballot measure for affordable housing funding o Consider potential legislative efforts to seek meaningful tax credits and other mechanisms 2 SANTA CLARA COUNTY RHNA SUBREGION TASK FORCE PROS & CONS OF RHNA SUBREGION FORMATION Pros Cons Example Creates flexibility & allows cities to trade Distribute the subregion's numbers or can use ABAG's distribution Empowers cities to have a say in the regional planning process Self-determination: a city is able to accept or not accept allocation from another city. Allows better alignment between local and regional needs Ability to plan along on transit corridors and near employment. Can find innovative solutions Collective problem -solving which may include negotiating credits and creative financing May facilitate the production of more housing Utilizes economies of scale and eliminates duplication. Siting housing near supportive services. Creates a forum for collaboration that leads to innovative solutions San Mateo County Trade Woodside/Redwood City & Daly City/Colma/County Creates awareness (and healthy competition) Creates a forum to share knowledge and success. When one city is doing the heavy lifting, may encourage other jurisdictions to step up to the plate. If success, may create additional opportunities for collaborative work Success may be housing or spill over to other technical areas (transportation). May use collaboration for legislative advocacy. Better development Cities can work together to build near transit and not SANTA CLARA COUNTY RHNA SUBREGION TASK FORCE PROS & CONS OF RHNA SUBREGION FORMATION necessarily confined by a city boundary. Creates a forum to discuss sharing of planning resources Share resources - - may share in cost to pay consultants for housing element preparation or program ideas (for those who want to share). Time, effort & resources which may end in same result. What if subregion fails to produce a different allocation? Lack of trust for fair and equitable process. Some cities may shirk their responsibility to step up and accept housing. Increases local control Ability to control own numbers and improve county -wide performance. Loss of political distance from MTC and ABAG Pressure on community to produce additional housing. Lack of clarity of the benefits to accept someone's numbers/housing City worried about allocation dumping Still need to plan for housing for all income levels Can't go to zero. Every jurisdiction still has an allocation in every income level. No role model No other subregion has such large population variances. Increased use of ADUs ADUs more feasible with cities with large residential lots. SANTA CLARA COUNTY RHNA SUBREGION TASK FORCE GUIDING PRINCIPLES - May 2018 Vision For Santa Clara County and its cities to work collaboratively to produce more housing in the Region. have a unified voice in responding to the area's housing needs-- a problem that transcends jurisdictional barriers. Benefits 1. By working together to plan for housing growth, the stage is set for implementing housing, and more housing will ultimately be built. 2. Housing will be planned in the right places, near transportation, jobs, and services. 3. Santa Clara County jurisdictions can work together to share resources. 4. Collaboration enables collective advocacy on regional and Statewide issues. 5. Partnership sets the stage for other cooperation, including sharing Housing Element consultants, sharing expertise, analyses, and policies, and potentially enabling a shared review by the California Housing and Community Development (HCD) Department. 6. Collective agreement is reached on strategies and tools to meet the region's housing need, including the potential for trading RHNA numbers. 7. Greater flexibility. Guiding Principles 1. Conform with all State objectives included in Section 66584(d), including ensuring that the allocation of affordable homes is allocated to all jurisdictions in the region in an equitable manner. 2. Allocate housing growth strategically around major transportation corridors and near employment and services, while respecting infrastructure constraints and the unique natural resources of Santa Clara County. 3. Foster collaboration between jurisdictions and develop collective strategies that provide a framework for addressing housing need, including the potential for resource / housing allocation trade-offs. 4. Facilitate an open dialogue between jurisdictions, the general public, and interested organizations, including transportation agencies and land use bodies. 5. Utilize existing forums for discussion (e.g., Cities Association, City Managers' Association, SCCAPO, etc.). Keys to Success 1. Taking responsibility for the process and the resulting housing shares. 2. Taking into consideration other communities' interests as well as your own. 3. Being willing to accept a reasonable housing share, not just the lowest. 4. Being willing to consider negotiating trades. 5. Recognizing that working together locally is better than abdicating the responsibility to the region and the state. 6. Elected leaders in all jurisdictions willing to compromise for regional benefit. RESOLUTION NO. RESOLUTION OF INTENT TO SUPPORT FORMATION OF A HOUSING SUBREGION OF SANTA CLARA COUNTY LOCAL AND COUNTY GOVERNMENTS TO FACILITATE AND IMPLEMENT COUNTYWIDE HOUSING PRODUCTION CONSISTENT WITH THE REGIONAL HOUSING NEEDS ALLOCATION (RHNA) FORMULA CURRENTLY ASSIGNED BY THE ASSOCIATION OF BAY AREA GOVERNMENTS (ABAG) WHEREAS, Housing Element Law (Gov. Code Sections 65580 — 65589.8) provides for a Regional Housing Need Allocation process (RHNA); and WHEREAS, to implement such RHNA process in the San Francisco Bay Area, the State of California has delegated to the Association of Bay Area Governments (ABAG) responsibility to adopt an allocation methodology, then use the adopted methodology to assign to each jurisdiction in the Bay Area the obligation to zone enough housing development capacity to accommodate production of a specific number of housing units during the period from 2021 through 2029; and WHEREAS, Government Code Section 65584.03 provides that certain combinations of local governments may form a subregion to perform RHNA for themselves in order to allocate among themselves the total number of housing units assigned to them collectively by ABAG; and WHEREAS, the City/County of is interested in exploring the formation of a Regional Housing Needs Allocation (RHNA) subregion consistent with the California Government Code Section 65584 et seq and acceptable to the Association of Bay Area Governments (ABAG) and the California Department of Housing and Community Development (HCD) to facilitate collaboration with the county and all cities in the County of Santa Clara, to efficiently and effectively deliver housing production goals; and WHEREAS, the Board of the Cities Association of Santa Clara County has directed the review of the benefits of such a subregion and subsequently representatives of the Cities Association of Santa Clara County (CASCC) have formed a committee to evaluate and make recommendations regarding the importance of and opportunities for success through shared housing strategies which could be facilitated by a subregional effort; and WHEREAS, housing is a countywide challenge, and housing production types, numbers, density, appropriateness and affordability levels can vary in different communities, and the Cities' recognize all production types are important to the housing supply of the County and its related economic and social health; and WHEREAS, Cities are individually accountable for, and retain full local authority for, identifying sites for housing development and for adopting and implementing housing policies intended to facilitate production of housing to meet local, regional and state policy objectives embodied in the numbers prescribed by ABAG the Sustainable Community Strategy that will be adopted by ABAG and the Metropolitan Transportation Commission (MTC) in 2021; and WHEREAS; through mutual cooperation and planning, the production of these housing units may be enhanced through collective efforts and resources, therefore creating a forum for developing countywide policy consensus on matters related to the Sustainable Community Strategy; NOW, THEREFORE the City of does hereby find, determine, resolve and order as follows: Section 1: That it is in the best interest of the City to join with other cities in Santa Clara County to explore creation of the RHNA subregion and that by working together to plan for housing growth, the stage is set for implementing housing and more housing will ultimately be built to meet the needs of the entire County and its residents. Section 2: That the City Manager is hereby authorized and directed to enter into discussions regarding the formation of a RHNA subregion and the development of a workplan and budget, and schedule of actions leading to the countywide, self -administration of the housing needs allocation process, allocating the countywide total housing needs allocation among all the Cities and unincorporated County by consensus; and to bring back a recommendation and resolution for action to join a RHNA subregion, or in the alternative, an explanation detailing the decision not to participate in the RHNA subregion. By-laws of the Santa Clara County Subregional RHNA Process PURPOSE & BYLAWS The cities within the County of Santa Clara, and the County of Santa Clara, have adopted resolutions to participate as a Subregion (hereinafter referred to as "Subregion") in the Regional Housing Needs Allocation (RHNA) Process. The Cities Association of Santa Clara County (hereinafter referred to as "CASCC") will act as the representative for the Subregion. The Subregion hereby adopts the following bylaws for the purpose of providing for the orderly conduct of its affairs. ARTICLE 1 NAME The name of the separate entity established by the resolutions is the "Santa Clara County Sub - Regional RHNA Process" and may be referred to as "Subregion". ARTICLE 11 PURPOSES Section 1. Subregion shall have the following purposes: (a) Plan, organize, and maintain the work of the Subregion and be responsible for its overall operation; (b) Advise City Managers, City Councils and the Board of Supervisors of all significant activities of the Subregion; (c) Prepare, review, monitor, present to the cities and the County, and facilitate a consensus on the Regional Housing Needs Allocation housing shares for all the cities and the County for the 2021 Housing Element; (d) Submit to the Association of Bay Area Governments (ABAG) for approval the housing shares for Santa Clara County (cities and County). (e) Provide a forum for developing a countywide policy consensus, to the greatest extent possible, on matters related the Sustainable Communities Strategy process of which the Regional Housing Needs Allocation is a part; and a channel for communicating such consensus to the Joint Policy Committee of the Metropolitan Transportation Commission and the Association of Bay Area Governments overseeing the Sustainable Communities Strategy process from time to time when such a consensus is requested or required by the Joint Policy Committee. Section 2. Subregion shall not participate in or endorse any political activity involving any individual candidate for public office. The selection of officers within Article IV herein shall not be considered a political activity subject to this section. ARTICLE I I I MEMBERS Section 1. The County of Santa Clara and each city which has adopted a resolution of participation shall be members of the Subregion. Section 2. The RHNA Policy Committee (PC) of the Subregion shall consist of a member of the City Council of each participating city to be selected by that city, and one member of the Board of Supervisors to be selected by the Board of Supervisors. Section 3. Each member City Council and the Board of Supervisors may select one alternate member from its body who shall participate when the regular member is absent. Section 4. If both the member and the alternate will be absent, the City or County, respectively, may designate a substitute for that meeting and notify CASCC, in writing, of the designation. Section 5. Any member may withdraw from the Subregion by adopting a resolution and providing a written notice of intention to do so to the chairperson of the PC. The rights and obligations of any such member shall terminate 30 days after acceptance by the PC. Section 6. If any member, or designated representative, fails to attend two consecutive meetings, without notification of the Chairperson or the Executive Director, the Chairperson will notify the City Council or Board of Supervisors to encourage future participation. ARTICLE IV- OFFICERS Section 1. The officers of the PC shall consist of a chairperson and vice chairperson. Section 2. The chairperson and vice chairperson shall be elected by the PC and shall serve at the will of the PC. Section 3. Nomination for officers of the PC shall be made from the floor. Nominations shall be made by voting members of the PC only. Section 4. The chairperson and vice chairperson must be voting members of the PC. Section 5. Nominations and election of the chairperson shall precede nominations and election of the vice chairperson. Voting shall be public. Section 6. The chairperson shall preside at all meetings and may call special meetings when necessary. Section 7. The vice chairperson shall perform the duties of the chairperson in the absence of the chairperson. Section 8. A special election shall be called by the Board of Directors if the chairperson and/or vice chairperson is unable to serve. Section 9. All officers shall serve without compensation. Section 10. The chairperson or vice chairperson may be removed from office at any time by a majority vote of those members present. ARTICLE V STAFF SUPPORT Section 1. The CASCC Executive Director, CASCC staff and contractors shall provide support to the Subregion and all the established committees. Section 2. The PC shall have dealings with staff and contractors through the CASCC Executive Director. Section 3. All participating jurisdictions will share in the cost. ARTICLE VI COMMITTEES/ STAKEHOLDER REVIEW Section 1. The following standing committees shall assist in accomplishing the goals of the SANTA CLARA COUNTY SUB REGIONAL RHNA PROCESS: • RHNA Policy Committee • RHNA Technical Advisory Committee • City Managers Association • City Councils and Board of Supervisors • Association of Bay Area Governments Section 2. RHNA Policy Committee (PC) - 16 Members, one member from each city and the county, composed of elected officials. The primary role is to provide initial policy input to the process, review the RHNA TAC recommendations and adopt a policy consensus for transmittal to the cities and the County for ratification. Section 3. RHNA Technical Advisory Committee (RHNA TAC) - 16 Members - One member from each city and the county. Composed of senior staff technical experts in the field of housing and land use. Member agencies may flexibly assign different technical experts as a function of the subject being discussed. However, it is important that there be good communications between the different representatives such that issues do not need to be repeated or there are no conflicting positions from the representatives. Primary role is technical development of the issues and solutions. Section 4. City Managers Association - Monthly reports will be provided to the City Managers through the City Managers Association. This will allow ongoing input by the City Managers in the process. The final product will be presented to the City Managers for their recommendation to the RHNA PAC for approval of the final product. Primary role of the City Managers is practical assessment of the issues and solutions. Section 5. City Councils/ Board of Supervisors - Primary role is ratification of the RHNA Final Allocation prior to submittal to Association of Bay Area Governments (ABAG). Section 6. Association of Bay Area Governments (ABAG) - Final approval of RHNA Final Allocation. Section 7. An appeals process will be established by the PC in conjunction with ABAG to hear appeals by any cities or the County that disagree with their housing share as allocated by the Subregion. ARTICLE VII MEETINGS Section 1. The PC shall establish by resolution the date, time, and place for regular PC meetings. Section 2. The PC may hold special meetings called in accordance with Article IV, Section 6. Section 3. All meetings of the PC shall be held in accordance with the Brown Act, Government Code section 54950 Ct seq. ARTICLE VIII CONDUCT OF BUSINESS Section 1. A quorum shall consist of at least a majority of the members and shall be required for all meetings of the PC. Section 2. Except as state otherwise in these by-laws, all decisions of the PC shall be by majority vote of those present. Section 3. Adoption of the Final Regional Housing Needs Allocation shall require: 1. consent of a majority of all cities and the County participating in the Subregion, and 2. consent of each jurisdiction that has been allocated a greater share of housing than the ABAG default allocation. Section 4. Upon adoption of the final regional housing numbers, the subregion will share support for outcome and support each other, for example the subregaion releasing a resolution, annual report, and press event. Section 5. Except as provided in these bylaws, or by a majority vote of those present, Roberts Rule of Order Revised shall constitute the parliamentary authority for the PC. Section 6. These by-laws may be amended by a two-thirds majority vote of members present and who represent a majority of all cities and the County. ARTICLE IX OTHER MATTERS Section 1. No member shall receive compensation or reimbursement from PC or CASCC for expenses incurred in attending any meeting or other function. CITY OF PALO ALTO City of Palo Alto (ID # 9756) City Council Staff Report Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: Approval to Increase Compensation & Extend Term of Design Contract for Primary Tank Rehab Title: Approval of Amendment Number 1 to Contract Number C18168129 With Kennedy / Jenks Consultants for Professional Design Services for the Primary Sedimentation Tanks Rehabilitation and Equipment Room Electrical Upgrade Project at the Regional Water Quality Control Plant to Add Services, Increase Compensation by $249,631 for a New Maximum Compensation Not to Exceed $965,000, and to Extend the Contract Term Through March 31, 2022 - Capital Improvement Program Project WQ-14003 From: City Manager Lead Department: Public Works Recommendation Staff recommends that Council approve and authorize the City Manager or his designee to execute Amendment No. 1 to Contract No. C18168129 with Kennedy/ Jenks Consultants (Attachment A) to increase the contract amount by $249,631 to provide additional services for the Primary Sedimentation Tanks Rehabilitation and Equipment Room Electrical Upgrade Project (CIP WQ-14003), and to extend the term through March 31, 2022. The revised total contract amount is not to exceed $965,000 including $650,335 for basic services and $314,665 for additional services. Background On January 29, 2018, Council approved a professional services contract (Attachment B, SR ID 8729) for design services with Kennedy/ Jenks Consultants ("K/J") for the Primary Sedimentation Tanks Rehabilitation and Equipment Room Electrical Upgrade Project. The scope of the basic services requires K/J to design the electrical equipment replacement at their original location and perform an alternatives analysis for siting the electrical equipment at other locations that City of Palo Alto Page 1 would meet current building and electrical codes. It was contemplated that if a location other than the original location is selected by the City, additional services (including contract term extension and compensation increase) would be needed to complete the project design. Discussion In the existing pump room at the Regional Water Quality Control Plant, there is currently an electrical power distribution center (called a motor control center or "MCC") that safely delivers industrial power to equipment at the primary sedimentation tanks and other wastewater treatment equipment. When installed in 1972, design standards did not require that electrical equipment be protected from hazardous gas environments, housekeeping spray water, leaking water pipes, and other electrical arc flash safety risks. Current building codes, however, require that the MCC be placed outside the current pump room, in a properly ventilated space, and above the flood elevation. During project scoping, Public Works staff had not completed an analysis to site the MCC but anticipated that replacing in -situ might be impractical, technically infeasible, and/or cost prohibitive. As part of preliminary (30%) design under basic services of the contract, K/J performed an alternative analysis evaluating three potential locations for placement of the new MCCs: at its original and current location (Alternative 1), on top of the existing pump room (Alternative 2), and at a location at -grade adjacent to the pump room (Alternative 3). The analysis considered the current building code, electrical code, federal recommended flood protection elevations, long- term operating cost, plant's operation and maintenance needs, and complexity associated with construction sequencing. After review of the alternatives analysis, staff concluded that locating the new MCCs at a location at grade adjacent to the pump room would be economical, operationally efficient, and minimize complex downtime during construction. Keeping the MCC inside the existing room (Alternative 1) was ruled out because of the higher cost associated with capital and long-term ventilation of the entire pump room. Placing the MCCs on the roof deck (Alternative 2) was cost prohibitive due to structural strengthening requirements of an existing 1972 structure. Consequently, staff opted for placement of the MCC outside the existing pump room (Alternative 3). City of Palo Alto Page 2 Basic services under the contract included only full design of the locate -in -place alternative. The contract contemplated that if another option was required, the design services for that other option would be treated as additional services. Staff directed K/J to provide additional services to design the electrical room to implement the selected alternative. The original contract included a budget of $65,034 for additional services, which was authorized by staff and utilized for K/J to perform preliminary design of the electrical room at a location outside the pump room. Additional funding is needed to perform detailed design of the electrical room and its foundation as well as to provide other additional services as required to resolve unforeseen site conditions that are not in the scope of basic services. Timeline The preliminary design of the electrical room was completed in September 2018. The detailed design of the electrical room will begin following Council's approval of the amendment. The detailed design is expected to be completed three months after Council approval. As part of the basic services, K/J will provide engineering services during construction of this project, which is scheduled to begin during the third quarter of 2019 and complete by December 31, 2021. Staff will return to Council for approval to award a separate construction contract for this project. The contract term with K/J needs to be extended from January 31, 2021 to March 31, 2022 to provide engineering services until construction is completed and prepare record drawings following construction completion. Resource Impact Additional funding required for this contract amendment No. 1 is available in the Wastewater Treatment Enterprise Fund Capital Improvement Program Project, WQ-14003. The revised contract amount will be not to exceed $965,000. Policy Implications This recommendation does not represent any change to existing City policies. Environmental Review The project is exempt from review under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15301, subsections (b) and (e)(1), Existing Facilities, as it involves the repair and maintenance of an existing publicly - owned utility used to provide sewerage treatment services with a minor addition City of Palo Alto Page 3 to an existing building and no or negligible expansion of use. Attachments: • Attachment A - Amendment No.1 C18168129 Kennedy Jenks Consultants • Attachment B - Contract C18168129 WQCP Primary Sed Tanks Rehab and Elec Upgrade City of Palo Alto Page 4 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC AMENDMENT NO. ONE TO CONTRACT NO. C18168129 BETWEEN THE CITY OF PALO ALTO AND KENNEDY/JENKS CONSULTANTS This Amendment No. One to Contract No. C18168129 ("Contract") is entered into on this 26th day of November, 2018, by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("CITY"), and Kennedy/Jenks Consultants, a California Corporation, located at 2350 Mission College Blvd., Suite 525, Santa Clara, CA 95054 ("CONSULTANT"). RECITALS A. The Contract was entered into on January 22, 2018 between the parties for a three-year term for the provision of professional design services for the Primary Sedimentation Tanks Rehabilitation and Equipment Room Electrical Upgrade Project. B. The parties wish to amend the Contract to extend the term to March 31, 2022, to specify Additional Services to be performed, and increase the maximum compensation (to be added to the Additional Services budget) by $249,631 from the original contract amount of $715,369 to $965,000. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the parties agree: SECTION 1. Section 4, "NOT TO EXCEED COMPENSATION", of the Contract is amended and replaced in its entirety to read as follows: "The compensation to be paid to CONSULTANT for performance of the Services described in Exhibit "A" ("Basic Services"), and reimbursable expenses, shall not exceed Six Hundred Fifty Thousand Three Hundred Thirty -Five Dollars ($650,335). 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 Nine Hundred Sixty -Five Thousand Dollars ($965,000). 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. 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 1 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC 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 2. Section 12, "SUBCONTRACTING", of the Contract is amended and replaced in its entirety to read as follows: El X❑ "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. Notwithstanding Section 11 above, CITY agrees that specified subconsultants may be used to complete the Services. The subconsultants authorized by CITY to perform work on this Project are: • National Plant Services • Testing Engineers, Inc. • CAL Engineering & Geology • Bohley Consulting, Inc. • BESS Testlab, Inc. CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the city manager or his designee. If a subconsultant adds a markup on any direct cost incurred by the subconsultant and charged to CONSULTANT, CONSULTANT shall not charge CITY a markup that would result in a markup that exceeds 10% of the direct cost paid by the subconsultant." SECTION 3. The following exhibits to the Contract are hereby added, or deleted and replaced in their entirety, as indicated below, 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 — Additional Services", is hereby added. b. Exhibit "B", entitled "Schedule of Performance", is hereby amended and replaced in its entirety with revised Exhibit "B", "Schedule of Performance", as revised and attached hereto and incorporated herein by this reference. 2 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC c. Exhibit "C", entitled "Compensation" is hereby amended and replaced in its entirety with revised Exhibit "C", "Compensation", attached hereto and incorporated herein by this reference. d. Exhibit C-1, "Hourly Rate Schedule" is hereby amended and replaced in its entirety with revised Exhibit "C-1", "Hourly Rate Schedule", attached hereto and incorporated herein by this reference. SECTION 4. Except as herein modified, all other provisions of the Contract, including any exhibits and subsequent amendments thereto, shall remain in full force and effect. 3 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC IN WITNESS WHEREOF, the parties hereto have by their duly authorized representatives executed this Amendment on the date first above written. CITY OF PALO ALTO City Manager or Designee APPROVED AS TO FORM: City Attorney or Designee Attachments: KENNEDY/JENKS CONSULTANTS Officer 1 DocuSigned by: BY: ,)btuit, aickbf Name: Djofin 8WyCKoff Title: Vice Presi dent Officer 2 (Required for Corp. or LLC) //��DocuSigned�///by: ,/ By a,..ej /J irmalC so . Name:"5oug'las' Henderson Title: Assistant Secretary Revised Exhibits: EXHIBIT "A-1": SCOPE OF SERVICES — ADDITIONAL SERVICES EXHIBIT "B": SCHEDULE OF PERFORMANCE EXHIBIT "C": COMPENSATION EXHIBIT "C-1": HOURLY RATE SCHEDULE 4 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "A-1" SCOPE OF SERVICES - ADDITIONAL SERVICES DESIGN SERVICES FOR PRIMARY SEDIMENTATION TANKS REHABILITATION AND EQUIPMENT ROOM ELECTRICAL UPGRADE PROJECT CIP WQ-14003 5 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "A-1" SCOPE OF SERVICES — ADDITIONAL SERVICES The Consultant shall provide the following Additional Services as sub -tasks to Section IV detailed in this Exhibit "A-1", in addition to the listed tasks in Exhibit "A" (Scope of Services) Section IV. Additional Services ITEM (B): Structural Design — New Electrical Enclosure Under Task 1.5, should Alternative 1, 2 or 3 be chosen as the preferred alternative for siting the replacement MCCs, CONSULTANT shall perform the structural analysis and design services associated with the selected alternative under this task - Item (D). The services shall include: A. Geotechnical exploration (that includes two CPT borings) by a professional geotechnical consulting firm subcontracted to the CONSULTANT. B. Structural analysis and design equivalent to that associated with a pile -supported slab suitable for the support of a stand-alone, factory -assembled electrical enclosure, and the development of associated drawings and technical specifications. 90% and Final Design drawings and specifications shall be incorporated into Task 2 deliverables. CITY review processes and discussions shall be incorporated with Task 2 review workshops and responses to comments. C. Development of a written report documenting the results of the structural analysis and required improvements. D. Attendance at a design review meeting with the CITY (as part of Task 1.5D and Task 2 workshops) to review and discuss the structural analysis and proposed improvements. E. Underground utility locating by a professional geotechnical consulting firm subcontracted to the CONSULTANT. F. Site surveying by a professional geotechnical consulting firm subcontracted to the CONSULTANT. 6 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "B" SCHEDULE OF PERFORMANCE CONSULTANT shall perform the Services so as to complete each milestone on or before the completion dates specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the Notice to Proceed (NTP). Milestones Completion Date 1. Notice to Proceed 02/06/2018 2. Design Kick-off Meeting 02/07/2018 3. Definition Workshop #1 03/27/2018 4. PSTs Inspection 11/31/2018 5. Definition Workshop #2 06/12/2018 6. Draft Preliminary Design Report 07/12/2018 7. Final Preliminary Design Report 10/31/2018 8. Preliminary Design Report Review Workshop 07/24/2018 9. CEQA/ CATEX Project Descriptions 06/30/2018 10. SRF Engineer's Project Report 09/21/2018 11. Design - 60% Deliverable 10/12/2018 12. Design Review Workshop #1 10/23/2018 13. Design - 90% Deliverable 01/11/2019 14. Design Review Workshop #2 01/17/2019 15. Design - 100% Deliverable 03/01/2019 16. Engineering Services during Bidding 09/30/2018 17. Engineering Services during Construction 03/31/2022 7 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C" COMPENSATION CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the hourly rate schedule attached as Exhibit C-1 up to the not to exceed budget amount for each task set forth below. CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. CITY's Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for Basic Services, including reimbursable expenses, and the total compensation for Additional Services do not exceed the amounts set forth in Section 4 of this Agreement. BUDGET SCHEDULE NOT TO EXCEED AMOUNT Task 1 $285,660 (Preliminary Design) Task 2 $188,884 (Detailed Design) Task 3 $ 18,901 (Engineering Services during Bidding) Task 4 $119,863 (Engineering Services during Construction) Task 5 (Project Management) Subtotal Basic Services Reimbursable Expenses Total Basic Services and Reimbursable Expenses Additional Services (Not Included in Basic Services) Maximum Total Compensation $ 30,430 $643,738 $ 6,597 $650,335 $314,665 $965,000 8 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC 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 $1,000 shall be approved in advance by the CITY's project manager. ADDITIONAL SERVICES NOT INCLUDED IN BASIC 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. 9 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C-1" HOURLY RATE SCHEDULE Kennedy/Jenks Consultants, Inc. Billing Classification: CAD -Technician Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Engineer-Scientist- Specialist 1 Specialist 2 Specialist 3 Specialist 4 Specialist 5 Specialist 6 Specialist 7 Specialist 8 Specialist 9 Project Administrator Notes: Hourly Rate: $132 $118 $141 $155 $168 $182 $205 $228 $246 $264 $109 1. Above rates are effective from notice to proceed date through December 31, 2018. 2. Rates to be escalated 3 per cent per year thereafter. 3. Rates include salary, overhead and profit. 4. Sub -consultants' work will be billed to City at cost plus 10% markups. For direct costs where a 10% increase has already been added by the subconsultant(s), Kennedy/ Jenks is not authorized to bill the City an additional 10% markups on top of the 10% markups already added by the subconsultant(s). 10 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: National Plant Services Scope of Work: To provide wastewater facility cleaning and inspection services as ordered and directed by Kennedy/Jenks. Rates: The following schedule of rates and charges will apply to the performance of this work (tasks in bold below are planned to be performed for this Project): 1. Jet/Vac Unit w/Operator @ $220.00/Hr ST $260.00/Hr OT $300.00/Hr PT 2. CCTV Unit w/ Operator @ $200.00/Hr ST $240.00/Hr OT $280.00/Hr PT 3. Jet/Vac Unit w/Operator & Tech w/utility truck @ $340.00/Hr ST $410.00/Hr OT $480.00/Hr PT 4. Additional Tech @ $120.00/Hr ST $150.00/Hr OT $180.00/Hr PT 5. Heavy Industrial Air -Moving Unit w/Operator @ $240.00/Hr ST $280.00/Hr OT $320.00/Hr PT 6. BL Vacuum Truck w/Operator @ $200.00/Hr ST $240.00/Hr OT $280.00/Hr PT 7. Grouting Unit w/Operator @ $250.00/Hr ST $290.00/Hr OT $330.00/Hr PT 8. Materials/Supplies @ Cost plus 15% (sand bags, bleach, etc.) 9. Equipment Rentals @ Cost plus 15% (pressure cleaners, boom trucks, arrowboards, etc.) 10. CCTV Unit w/Lateral Launch @ $250.00/Hr ST $290.00/Hr OT $330/Hr PT 11. CCTV/Sonar unit & Winch Truck w/2 Techs @ $3.50-$6.00/LF (Depending on job specifics) 12. CCTV/Sonar/Laser MSI Unit w/3 Techs @ $5.50-$9.00/LF (Depending on job specifics) 13. Sonar processing $0.5-$2.00/LF 14. Laser Processing $2.50-3.50/LF 15. PACP coding of CCTV videos $0.25-.50/LF (applies to MSI inspections only) 16. Mobilization/Demobilization Charges and traffic control will be determined by Job Scope and Equipment Requirements 17. Out -of -Town Expenses @ $125/Day/Technician 11 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: Testing Engineers, Inc. Scope of Work: To provide concrete testing services as ordered and directed by Kennedy/Jenks (tasks in bold below are planned to be performed for this Project): Rates: A. CONSULTING - Hourly and Unit Rates for Testing and Laboratory Tests • Coring, Pu1ULoad Testing, Ground Penetrating Radar (GPR) - 2 -man Crew (Confined Space Trained Rate/hr.: $265/hour • Engineer Report Preparation Rate/hr.: $ 160/hour • Laboratory Concrete Compressive Strength Testing Rate/core: $85/core • Laboratory Carbonization Testing on Cores by pH Methods w/Phenolphthaleim Rate/core: $85/core B. CONSULTING - Service Unit Rate • Concrete Coring I Compressive Strength/ Carbonization /Non -Shrink Grout Repair/travel Rate/core: $615/core • Pu11/Load Testing - Lift Hanger Rate/test: $205/test • GPR Rate/day: $2,500/day • Report with Results Rate/report: $ 1,300/report Services will be billed from portal to portal in 4 and 8 -hour increments. Above rates do not account for any overtime. In addition, the rates provided assume the work will be completed within the hours of 6:00 am and 6:00 pm during the weekday. If night shift rates are requested, Testing Engineers, Inc. will provide updated rates to Kennedy/ Jenks Consultants. 12 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: CAL Engineering & Geology Scope of Work: To provide geotechnical study and laboratory test services as ordered and directed by Kennedy/Jenks: Rates: 1. Professional Services. These are "all -up" rates, and include direct salary cost, overhead, general and administrative costs not separately accounted for, and profit. They shall remain in effect through December 31, 2020. Ongoing work continuing beyond December 31, 2020 will be invoiced at the applicable new year's rate. Personnel 2018 2019 2020 Rates/Units Senior Principal Engineer/Geologist $255 $260 $265 per hour Principal Engineer/Geologist $230 $240 $245 per hour Associate Engineer/Geologist $205 $210 $220 per hour Senior Engineer/Geologist $190 $195 $200 per hour Project Engineer/Geologist $150 $155 $160 per hour Staff Engineer/Geologist $135 $140 $145 per hour Technician (Straight rate prevailing wage) $120 $125 $130 per hour Senior GIS/CADD Specialist $130 $135 $135 per hour GIS/CADD Specialist $120 $125 $125 per hour Project Assistant $90 $90 $95 per hour Administration/Clerical $80 $85 $85 per hour Special Inspector (Straight rate prevailing wage; no 4 -hr min) $125 $130 $135 per hour Deposition/Court Testimony (minimum 4 hours) $375 $385 $395 per hour Field and Laboratory Tests 2018 2019 2020 Rates/Units Concrete Compressive Strength Testing $37 $38 $39 per cylinder Moisture Content (ASTM D 2216) $22 $22 $23 per test Moisture & Density (ASTM D 4318) $29 $30 $31 per test Atterberg Limits (ASTM D 4318) $191 $196 $202 per test Compaction Curve, 4" mold (ASTM D 1557) $242 $249 $257 per test Compaction Curve, 6" mold (ASTM D 1557) $299 $308 $317 per test Wash over #200 Sieve (ASTM D 1140) $67 $69 $71 per test Sieve Analysis with #200 Wash (ASTM D 422) $139 $143 $148 per test Sieve & Hydrometer (ASTM D 422) $216 $223 $229 per test Reimbursable 2018 2019 2020 Rates/Units Mileage (per allowable federal) $1 $1 $1 per mile Nuclear Gage $54 $56 $57 per day 13 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC Inclinometer Vane Shear Device $184 $190 $196 $106 $109 $113 per day per day 2. Travel Time. Travel time will be charged at regular hourly rates, not to exceed eight (8) hours per day. 14 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: Bohley Consulting, Inc. Scope of Work: To provide site surveying services as ordered and directed by Kennedy/Jenks:. Rates: CLASSIFICATION Principal Deposition Trial Principal Associate Senior Engineer Associate Engineer Assistant Engineer 1 -Person Survey Crew 2 -Person Survey Crew RATES EFFECTIVE January 1, 2017 RATE PER HOUR $220.00 $275.00 $350.00 $175.00 $150.00 $135.00 $100.00 $225.00 $300.00 15 Amendment No,1 DocuSign Envelope ID: E62819A5-A81C-4CA9-8452-56FFA004A8BC EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: BESS Testlab, Inc. Scope of Work: To provide utility potholing services as ordered and directed by Kennedy/Jenks. Rates: CLASSIFICATION Project Management 1 -Person Utility Locate & Mark w/ GPR 2 -Person Utility Potholing - Air Vac (per hole) 2 -Person Utility Trench - Air Vac (Native BF) RATE PER HOUR $140 $185 $650 EACH $2,280 EACH Rates and Reimbursable Expenses: • Overtime applies after 8 hours of work and weekends. • Hourly rates are portal to portal from our nearest office, unless specified otherwise. • Hourly rates apply to day shift (typical BESS day shift hours are 7:00 AM to 3:30 PM). • Prevailing wage and night rates will apply when necessary. • Mileage expenses, if applicable, shall not exceed the rate established by the IRS for the current year. 16 Amendment No,1 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 CITY OF PALO ALTO CONTRACT NO. C18168129 AGREEMENT BETWEEN THE CITY OF PALO ALTO AND KENNEDY/JENKS CONSULTANTS FOR PROFESSIONAL SERVICES This Agreement is entered into on this 22nd day of January, 2018, ("Agreement") by and between the CITY OF PALO ALTO, a California chartered municipal corporation ("CITY"), and KENNEDY/JENKS CONSULTANTS, a California corporation, located at 2350 Mission College Blvd, Suite 525 , Santa Clara, CA 95054 ("CONSULTANT"). RECITALS The following recitals are a substantive portion of this Agreement. A. CITY intends to to rehabilitate and upgrade the primary sedimentation tanks (PSTs) and ancillary systems at the Regional Water Quality Control Plant ("Project") and desires to engage a consultant to provide design and engineering services as outlined in Exhibit A in connection with the Project ("Services"). B. CONSULTANT has represented that it has the necessary professional expertise, qualifications, and capability, and all required licenses and/or certifications to provide the Services. C. CITY in reliance on these representations desires to engage CONSULTANT to provide the Services as more fully described in Exhibit "A", attached to and made a part of this Agreement. NOW, THEREFORE, in consideration of the recitals, covenants, terms, and conditions, in this Agreement, the parties agree: AGREEMENT SECTION 1. SCOPE OF SERVICES. CONSULTANT shall perform the Services described at Exhibit "A" in accordance with the terms and conditions contained in this Agreement. The performance of all Services shall be to the reasonable satisfaction of CITY. SECTION 2. TERM. The term of this Agreement shall be from the date of its full execution through January 21, 2021 unless terminated earlier pursuant to Section 19 of this Agreement. OR The term of this Agreement shall be from the date of its full execution through completion of the services in accordance with the Schedule of Performance attached at Exhibit "B" 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 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 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. 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 Six Hundred Fifty Thousand Three Hundred Thirty - Five Dollars ($650,335). 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 Sixty-five Thousand Thirty-four Dollars ($65,034). 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. 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 5. INVOICES. hi order to request payment, CONSULTANT shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including an identification of personnel who performed the services, hours worked, hourly rates, and reimbursable expenses), based upon the CONSULTANT's billing rates (set forth in Exhibit "C- 1"). If applicable, the invoice shall also describe the percentage of completion of each task. The information in CONSULTANT's payment requests shall be subject to verification by CITY. CONSULTANT shall send all invoices to the City's project manager at the address specified in Section 13 below. The City will generally process and pay invoices within thirty (30) days of receipt. SECTION 6. QUALIFICATIONS/STANDARD OF CARE. All of the Services shall be performed by CONSULTANT or under CONSULTANT's supervision. CONSULTANT represents that it possesses the professional and technical personnel necessary to perform the Services required by this Agreement and that the personnel have sufficient skill and experience to perform the Services assigned to them. CONSULTANT represents that it, its employees and subconsultants, if permitted, have and shall maintain during the term of this Agreement all licenses, permits, qualifications, insurance and approvals of whatever nature that are legally required to perform the Services. All of the services to be furnished by CONSULTANT under this agreement shall meet the professional standard and quality that prevail among professionals in the same discipline and of similar knowledge and skill engaged in related work throughout California under the same or Professional Services Rev. Apri127, 2016 2 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 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. ® Notwithstanding Section 11 above, CITY agrees that subconsultants may be used to complete the Services. The subconsultants authorized by CITY to perform work on this Project are: • National Plant Services • Testing Engineers, Inc. CONSULTANT shall be responsible for directing the work of any subconsultants and for any compensation due to subconsultants. CITY assumes no responsibility whatsoever concerning Professional Services Rev. Apri127, 2016 3 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 compensation. CONSULTANT shall be fully responsible to CITY for all acts and omissions of a subconsultant. CONSULTANT shall change or add subconsultants only with the prior approval of the city manager or his designee. SECTION 13. PROJECT MANAGEMENT. CONSULTANT will assign Mark Minkowski, PE as the Project Manager to have supervisory responsibility for the performance, progress, and execution of the Services and Don Ervin, PE as the project engineer 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 Siew Ching Chin, Public Works Department, Environmental Services Division, 2501 Embarcadero Way, Palo Alto, CA 94303, Telephone:650-838-2917, email: SiewChing.Chin@CityofPaloAlto.org. 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. 1 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 Professional Services Rev. Apri127, 2016 4 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 disbursements ("Claims") that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of CONSULTANT, its officers, employees, agents or contractors under this Agreement, regardless of whether or not it is caused in part by an Indemnified Party. ❑ 16.1. 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 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 Key Rating Guide ratings of A -:VII or higher which are licensed or authorized to transact insurance business in the State of California. Any and all contractors of CONSULTANT retained to perform Services under this Agreement will obtain and maintain, in full force and effect during the term of this Agreement, identical insurance coverage, naming CITY as an additional insured under such policies as required above. 18.3. Certificates evidencing such insurance shall be filed with CITY concurrently with the execution of this Agreement. The certificates will be subject to the approval of CITY' s Risk Manager and will contain an endorsement stating that the insurance is primary coverage and will not be canceled, or materially reduced in coverage or limits, by the insurer except after filing with the Purchasing Manager thirty (30) days' prior written notice of Professional Services Rev. Apri127, 2016 5 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 the cancellation or modification. If the insurer cancels or modifies the insurance and provides less than thirty (30) days' notice to CONSULTANT, CONSULTANT shall provide the Purchasing Manager written notice of the cancellation or modification within two (2) business days of the CONSULTANT's receipt of such notice. CONSULTANT shall be responsible for ensuring that current certificates evidencing the insurance are provided to CITY's Chief Procurement Officer during the entire term of this Agreement. 18.4. The procuring of such required policy or policies of insurance will not be construed to limit CONSULTANT's liability hereunder nor to fulfill the indemnification provisions of this Agreement. Notwithstanding the policy or policies of insurance, CONSULTANT will be obligated for the full and total amount of any damage, injury, or loss caused by or directly arising as a result of the Services performed under this Agreement, including such damage, injury, or loss arising after the Agreement is terminated or the term has expired. SECTION 19. TERMINATION OR SUSPENSION OF AGREEMENT OR SERVICES. 19.1. The City Manager may suspend the performance of the Services, in whole or in part, or terminate this Agreement, with or without cause, by giving ten (10) days prior written notice thereof to CONSULTANT. Upon receipt of such notice, CONSULTANT will immediately discontinue its performance of the Services. 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. Professional Services Rev. Apri127, 2016 6 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 All notices hereunder will be given in writing and mailed, postage prepaid, by certified mail, addressed as follows: To CITY: Office of the City Clerk City of Palo Alto Post Office Box 10250 Palo Alto, CA 94303 With a copy to the Purchasing Manager To CONSULTANT: Attention of the project director at the address of CONSULTANT recited above SECTION 21. CONFLICT OF INTEREST. 21.1. In accepting this Agreement, CONSULTANT covenants that it presently has no interest, and will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or degree with the performance of the Services. 21.2. CONSULTANT further covenants that, in the performance of this Agreement, it will not employ subconsultants, contractors or persons having such an interest. CONSULTANT certifies that no person who has or will have any financial interest under this 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 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. 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 Professional Services Rev. Apri127, 2016 7 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 comply with the following zero waste requirements: (a) All printed materials provided by CCONSULTANT to CITY generated from a personal computer and printer including but not limited to, proposals, quotes, invoices, reports, and public education materials, shall be double -sided and printed on a minimum of 30% or greater post -consumer content paper, unless otherwise approved by CITY's Project Manager. Any submitted materials printed by a professional printing company shall be a minimum of 30% or greater post - consumer material and printed with vegetable based inks. (b) Goods purchased by CONSULTANT on behalf of CITY shall be purchased in accordance with CITY's Environmental Purchasing Policy including but not limited to Extended Producer Responsibility requirements for products and packaging. A copy of this policy is on file at 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 4.62.030 for each hour worked within the geographic boundaries of the City of Palo Alto. In addition, CONSULTANT shall post notices regarding the Palo Alto Minimum Wage Ordinance in accordance with Palo Alto Municipal Code section 4.62.060. SECTION 25. NON -APPROPRIATION 25.1. This Agreement is subject to the fiscal provisions of the Charter of the City of Palo Alto and the Palo Alto Municipal Code. This Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This section shall take precedence in the event of a conflict with any other covenant, term, condition, or provision of this Agreement. SECTION 26. PREVAILING WAGES AND DIR REGISTRATION FOR PUBLIC WORKS CONTRACTS N 26.1 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. OR Professional Services Rev. Apri127, 2016 8 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 n 26.1 CONSULTANT 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 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. CONSULTANT 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. CONSULTANT 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. 26.2 CONSULTANT shall comply with the requirements of Exhibit "E" for any contract for public works construction, alteration, demolition, repair or maintenance. SECTION 27. MISCELLANEOUS PROVISIONS. 27.1. This Agreement will be governed by the laws of the State of California. 27.2. In the event that an action is brought, the parties agree that trial of such action will be vested exclusively in the state courts of California in the County of Santa Clara, State of California. 27.3. The prevailing party in any action brought to enforce the provisions of this Agreement may recover its reasonable costs and attorneys' fees expended in connection with that action. The prevailing party shall be entitled to recover an amount equal to the fair market value of legal services provided by attorneys employed by it as well as any attorneys' fees paid to third parties. 27.4. This document represents the entire and integrated agreement between the parties and supersedes all prior negotiations, representations, and contracts, either written or oral. This document may be amended only by a written instrument, which is signed by the parties. 27.5. The covenants, terms, conditions and provisions of this Agreement will apply to, and will bind, the heirs, successors, executors, administrators, assignees, and 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 Professional Services Rev. Apri127, 2016 9 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 will be deemed to be a part of this Agreement. 27.8 In the event of a conflict between the terms of this Agreement and the exhibits hereto or CONSULTANT's proposal (if any), the Agreement shall control. In the case of any conflict between the exhibits hereto and CONSULTANT's proposal, the exhibits shall control. 27.9 If, pursuant to this contract with CONSULTANT, CITY shares with CONSULTANT personal information as defined in California Civil Code section 1798.81.5(d) about a California resident ("Personal Information"), CONSULTANT shall maintain reasonable and appropriate security procedures to protect that Personal Information, and shall inform City immediately upon learning that there has been a breach in the security of the system or in the security of the Personal Information. CONSULTANT shall not use Personal Information for direct marketing purposes without City's express written consent. 27.10 All unchecked boxes do not apply to this agreement. 27.11 The individuals executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27.12 This Agreement may be signed in multiple counterparts, which shall, when executed by all the parties, constitute a single binding agreement Professional Services Rev. Apri127, 2016 10 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 CONTRACT No. C18168129 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 �DocuSigned by: Ed Swkada to sni1aua for James Keene APPROVED AS TO FORM: [-J=DocuSigned by: awebra, bu. 36C6B9D557AF4E3_. City Attorney Attachments: EXHIBIT "A": EXHIBIT "B": EXHIBIT "C": EXHIBIT "C-1": EXHIBIT "D": KENNEDY/JENKS CONSULTANTS Officer 1 ,-DocuSigned by: jOLLIA, ghidaff DB563BE82979458... John Wyckoff vice President Officer 2 (Required for Corp. or LLC) �DocuSigned by: 004AS b. kv,i,U SOtA, �7CE)1CC484DB4E5... Douglas B. Henderson Assistant Secretary SCOPE OF SERVICES SCHEDULE OF PERFORMANCE COMPENSATION SCHEDULE OF RATES INSURANCE REQUIREMENTS 11 Professional Services Rev. Apri127, 2016 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 EXHIBIT "A" SCOPE OF SERVICES I. BACKGROUND There are four primary sedimentation tanks (each measured 220 feet long by 41 feet wide by 14 feet deep) that are covered with a monolithic concrete slab. These tanks are equipped with mechanical and electrical equipment for wastewater flow control and sludge and scum removal. Over the course of 45 years, visible cracks were observed on the concrete roof slab and cracks and concrete spalling were observed on the interior surfaces of the tanks. Aging equipment including sludge collection mechanism drives and electrical motor control center will need to be repaired or replaced. The CITY intends to rehabilitate and upgrade the primary sedimentation tanks (PSTs) and ancillary systems to provide reliable service for at least the next 20 years. Based on past condition assessment and Operations and Maintenance records, improvements preliminarily identified for PSTs and ancillary systems include the following: • Rehabilitate the concrete interior of the four PSTs. • Rehabilitate the concrete exterior of the PSTs, Primary Influent Channel and Primary Effluent Channel. • Coat the PSTs interior concrete surfaces for corrosion protection as appropriate. • Replace the hatches including the rebates/frames in the concrete deck located above the PSTs (except the existing hatches located above the scum skimmers), Primary Influent Channel, and Primary Effluent Channel • Remove the existing hatches located above the scum skimmers and install guardrails around the openings. • Replace the PST top deck drain covers. • Test and replace (as necessary) the existing equipment lifting hooks located in the PSTs. • Repair inter -tank leaks in the PSTs. • Repair or replace valves in the PSTs. • Rehabilitate (as necessary) the PST sludge and scum lines. • Replace the three-way gear box drives for the longitudinal and cross -collector sludge collection mechanisms. • Install rear idler sprocket adjusters on the longitudinal sludge collection mechanisms. • Replace the PST 3 sludge pump suction and discharge piping. • Replace the PST scum skimmer blade wipers. • Install valve actuators and controls to automate scum feed to Scum Pit B or to the Scum Feed Pump(s). • Repair or replace the PST effluent weirs. • Install a new electrical circuit(s) with receptacles around the perimeter of the PST top deck that can be used to power fans, maintenance equipment, tools, welding equipment, and transformers and distribution board carts. Professional Services Rev. Apri127, 2016 12 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 • Install sensors for remote monitoring of the operation and alignment of the flights on the PST sludge collection mechanisms. • Install electrical and control system improvements for the PST scum skimmers and sludge collector drive systems. • Replace MCCs F, G and H; and install new conduit and wire between these MCCs and equipment associated with the MCCs. All planned replacement and rehabilitation work for the Project must be constructed such that the CITY can maintain operation of the wastewater treatment processes and equipment necessary to comply with permit requirements, with the understanding that temporary shutdowns of selected facilities will likely be required. II. SCOPE OF WORK (BASIC SERVICES) The CONSULTANT shall provide engineering services for: • Assessing the existing conditions of the PST structure, primary effluent channel (including 36 - inch return activated sludge [RAS] pipe and 72 -inch bypass slide gate located in the primary effluent channel), mechanical equipment and components, and electrical equipment; • Identifying rehabilitation recommendations for the PST and primary effluent structures and mechanical components; • Identifying replacement recommendations for mechanical and electrical equipment; • Designing the selected rehabilitation and replacement recommendations; • Assisting the CITY with permitting, environmental review process and state revolving fund application; • Assisting the CITY with bidding the designed recommendations; and, • Assisting the CITY during construction, commissioning and startup of the designed recommendations. CONSULTANT's scope of work shall include the following tasks: Task 1 Preliminary Design CONSULTANT shall collect sufficient data to support development of the recommendations for rehabilitation and upgrades of the PSTs and ancillary systems. The Preliminary Design Task includes the following subtasks: Task 1.1 Kickoff Meeting and Definition Workshops CONSULTANT shall coordinate and lead one (1) Project Kickoff Meeting and two (2) Definition Workshops to define/refine assessment needs, coordinate the overall field inspection schedule, and review initial rehabilitation alternative concepts. CONSULTANT shall prepare related agendas and meeting minutes. Professional Services Rev. Apri127, 2016 13 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 Task 1.2 Review Record Drawings CONSULTANT shall review relevant Plant's Record Drawings including, but not limited to, the following as provided by CITY: • As -Built Drawings for the Construction of Regional Wastewater Treatment Works, Project Unit 1 — Water Quality Control Plant (Jenks & Adamson, 1969). • Electrical Shop Drawings for the Construction of Regional Wastewater Treatment Works, Project Unit 1 — Water Quality Control Plant (Autocon, 1970) • Design/Record Drawings for the Construction of Advanced Wastewater Treatment Facilities (Jenks & Harrison, 1977/1981) • Record Drawings for Phase 1 Capacity Expansion Project (CH2M Hill, 1988) • 12 KV Primary — 480V Standby Single Line Diagram CONSULTANT shall field validate structural, mechanical, electrical and control systems as available as - built information may not match current conditions and/or system modifications may have been made over the years. CONSULTANT shall coordinate with the CITY Project Manager and conduct staff interviews to gather recent and current information on the aforementioned systems. Existing conditions shall be reflected in the preliminary and detailed design deliverables for this project. Task 1.3 Review Past Reports CONSULTANT shall review the Plant's Facility Condition Assessment Report (K/J, 2004) and Long Range Facilities Plan (Carollo, 2012) for information pertinent to PSTs condition assessment and rehabilitation recommendations. CONSULTANT shall use the Definition Workshops and other communication channels with CITY staff to identify more recent developments that may evolve or deviate from the improvement projects that were previously identified in the Long Range Facilities Plan. Task 1.4 Field Inspections CONSULTANT shall conduct field inspections to collect sufficient data to support the development of recommendations for the planned rehabilitations and upgrades. Field inspection shall include the following activities: A. Coordinate the schedule for entry into the PSTs for inspection by CONSULTANT and/or subcontractor. Coordinate special access requirements (such as partial process shutdowns and confined space entries set up) with CITY Project Manager. The CITY is not responsible for the safety of non -CITY employees, but will set up necessary equipment for confined space entry by CITY's employees. The CONSULTANT may enter the PST using the equipment setup by the CITY, under the supervision of a CITY's superintendent, and shall ensure that each entrant is trained for confined space entry and equipped with necessary PPE. The CONSULTANT shall coordinate with CONSULTANT's subcontractor to ensure that they provide their own confined space entry equipment and competent personnel that meet Cal -OSHA requirements. B. Conduct field observations of the interiors of the available PSTs (only one PST can be taken offline at a time). i. Assess the condition of the concrete and coatings by: • Visually observing and hand -probing in -situ concrete surfaces. Professional Services Rev. Apri127, 2016 14 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 • Pressure washing small areas (approximately 10 -feet square) of in -situ concrete surfaces to remove surface debris, failed coatings, and soft concrete; then visually observing and hand -probing the areas. ii. Perform the following concrete sampling and testing: • Measuring the depth of concrete cover over reinforcing steel using non-destructive means. • Collecting concrete cores and performing compressive strength and carbonation (pH) tests on the cores. iii. Visually observe, hand -probe, and load test the existing equipment lifting hooks. C. Conduct field observations of the exteriors of the PSTs, Primary Influent Channel, Primary Effluent Channel, equipment and piping. This shall include visually observing and hand -probing in -situ concrete surfaces, equipment and other mechanical elements, and piping. Elements to be observed shall include: i. Hatches (including rebates/frames) on the PSTs concrete deck, Primary Influent Channel and Primary Effluent Channel ii. Three-way gear box drives for the longitudinal and cross -collector sludge collection mechanisms. iii. PST 3 sludge pump discharge piping. iv. PST effluent weirs. v. PST top deck drain covers. D. Perform closed-circuit television (CCTV) inspection of the interiors of the PST scum and sludge piping after CITY has emptied and cleaned the interior of the piping to the extent reasonably possible. E. Perform visual observation of the following existing electrical systems: i. MCCs F, G, and H and the equipment they serve. ii. Power circuit(s) for receptacles and lighting located around the perimeter of the PST top deck. F. Perform visual observation of the existing scum system in the vicinity of Scum Pit B and the Scum Feed Pump(s). G. Conduct a preliminary assessment of the condition of the Primary Effluent Channel and 36" RAS line while the channel remains in service. This will include working with CITY staff to observe the condition of the portions of the channel and RAS pipe visible through existing hatches in the deck located above the channel. H. Conduct a preliminary assessment of the condition of the 72 -inch bypass gate at the north end of the Primary Effluent Channel while the channel remains in service. It is understood that the bypass gate is submerged during normal operation of the PSTs. This gate has reportedly not been exercised since its installation in the 1970's; it allows for a complete bypass of the secondary process. The local control panel and valve actuator appear to be deteriorated and shall be included in this assessment. I. The existing sludge collection flights, chains, guides, shoes, supports, drive axles and sprockets, and idler sprockets are recently replaced and are not slated for replacement as part of this Project. CONSULTANT shall confirm the condition of these elements during field inspection. Professional Services Rev. Apri127, 2016 15 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 Task 1.5 Preliminary Design Report (PDR) CONSULTANT shall develop a PDR to document the design basis of this Project, summarize the investigation results from field inspection, and present the design concepts that will be developed subsequently in detailed design to rehabilitate the PSTs and ancillary facilities. The PDR shall include the following: A. Design criteria. B. Design recommendations for PSTs rehabilitation: i. Repair and rehabilitation of concrete and structural elements. ii. Rehabilitation of sludge and scum lines (as necessary). iii. Replacement of three-way gear drive box. iv. Other mechanical improvements. C. Condition assessment findings and design recommendations for primary effluent channel, 36 -inch RAS and 72 -inch bypass gate rehabilitation. CONSULTANT shall develop a conceptual plan for isolating sections of the Primary Effluent Channel to facilitate construction of the planned improvements. The construction contractor will be required to develop a detailed design for isolating sections of the Primary Effluent Channel based on the conceptual plan presented in the bid documents D. Recommendations for electrical upgrades including schedule and sequencing: i. Evaluation of electrical and instrumentation systems. ii. Alternative analysis for placement of new MCCs F, G and H. Consultant's scope is limited to evaluating up to three alternatives and the CITY may ask for additional service if the CITY choses to pursue any one of the proposed alternatives. Alternatives to be considered: • Alternative 1 - Modify the existing Pump Room to create a separate electrical room within which the replacement MCCs can be installed. • Alternative 2 - Install the replacement MCCs on the top deck of the main structure that forms the ceiling of the existing Pump Room. • Alternative 3 - Construct a new at -grade enclosure separate from the existing Pump Room within which the replacement MCCs can be installed. iii. Integration of new equipment into electrical system. iv. Control scheme to integrate new equipment into existing Plant SCADA. E. Prioritization and timing of PSTs and ancillary systems rehabilitation. F. Conceptual schedule and sequencing plans for construction of the planned improvements. G. Preliminary drawings (30% Design). H. Preliminary specifications list. I. Preliminary Opinion of Probable Construction Cost (OPCC). The OPCC shall have an accuracy range of+50% to —30% comparable to AACE International's standard for a Class 4 Estimate. Upon submission of the Draft PDR to the CITY for review, CONSULTANT shall schedule and conduct a PDR Review Workshop with the CITY to discuss the CITY's comments. CONSULTANT shall lead the PDR Review Meeting and prepare a related agenda and meeting summary. Professional Services Rev. Apri127, 2016 16 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 For both the draft and final PDR documents, CONSULTANT shall submit to the CITY four (4) hardcopies of the PDR, one (1) electronic copy in PDF format, and one (1) electronic copy in Microsoft Word format. Task 1.6 CEQA and SRF Documentation The construction work planned for the PSTs rehabilitation and electrical upgrades is within the RWQCP fence line and is anticipated to have no significant environmental impacts to habitat or the public. At this time, this project is expected to qualify for a Categorical Exemption (CatEx) under California Environmental Quality Act (CEQA) environmental review process. In the event that an initial study is necessary to evaluate any possible significant impacts, the City may authorize preparation of an initial study and related CEQA documents under Additional Services. If this occurs, Consultant shall retain a subconsultant approved by the City to prepare these documents in direct coordination with the City's Planning and Community Environment Depaitinent. Alternatively, the City may, in its sole discretion, directly engage a separate consultant to complete the CEQA documents. The CITY will be the lead agency for completing the CEQA process before or concurrently with the SRF application process. The CITY plans to finance the construction of this Project through California State Water Resources Control Board (SWRCB) Clean Water State Revolving Fund (SRF). The CITY will be the lead agency for planning and submitting the SRF application package -- which includes General, Financial Security, Technical and Environmental packages — to the SWRCB Division of Finance Assistance (DFA). The CONSULTANT shall support the CITY by: A. Preparing the documentation for a Categorical Exemption for CEQA to a level of detail that meets both CEQA Plus and SRF Environmental Package requirements. B. Preparing the SRF Technical Package (Project Report). CONSULTANT shall hold a review meeting, as needed, with CITY staff to discuss the draft Project Report. C. Providing advisory services to the CITY such as development of strategies for improving the prospects for receiving SRF funding within a near -term timeframe and review of other funding opportunities. Ten hours has been budgeted for advisory services. CONSULTANT shall produce the CEQA and SRF documentation in draft format for CITY review and final format for submission to the regulatory agency. Task 2 Detailed Design CONSULTANT shall generate the detailed design deliverables based on the design concepts and criteria identified in the PDR. The design shall include the development of construction sequencing requirements that will maintain the CITY's ability to comply with its NPDES discharge permit requirements. The design shall be developed progressively with two intermediate submittals (60% Design and 90% Design) and a Final Design submittal. CONSULTANT shall arrange a design review workshop following the 60% and 90% detailed design submittals. CONSULTANT shall prepare the meeting agenda, run the meeting, and provide a meeting summary documenting the main topics, decisions and action items covered during each workshop. Design elements shall include the following: • Process/Mechanical Design — Design shall include documenting field verified information on existing conditions, where possible. The mechanical design shall also include developing process Professional Services Rev. Apri127, 2016 17 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 schematics, developing layouts of mechanical equipment and related systems, delineating the extent of coating replacement, and detailing mechanical improvements including piping. • Structural Design — Design shall be in accordance with jurisdictional requirements including the California Building Code. Design shall include documenting field verified information on existing conditions (where possible) and structural improvements which may include miscellaneous foundation, handrail, and platform rehabilitation in the vicinity of the PSTs. Under Task 2, structural design associated with the MCC replacement considers installing the new MCCs F, G and H in the Equipment Room and/or Blower Room with necessary structural analyses. Should the new MCCs be sited (based on alternative analysis in Task 1.5, Item D -ii) at a different location that requires structural analysis and detailed structural design, the structural analysis and design work shall be performed as an Additional Service. In either case, the design shall be included in the detailed design deliverables under Task 2. • Electrical Design — Design shall include determination of requirements for electrical loads, cable and conduit sizing, control, alarm and area lighting. Design shall also include MCC layouts reflecting MCC modifications and/or additions. Design shall be based on the use of Smart MCCs that have interfaces to SCADA and integral arc flash mitigation measures. In addition, design shall be based on the use of LED light fixtures. Existing conditions shall be rendered based on field investigations conducted during Preliminary Design. • Instrumentation & Control (I&C) Design — Design shall be compatible with the CITY's existing SCADA and PLC systems. Where appropriate, control shall utilize local PLCs with back-up control via the existing SCADA system. Automation of PST equipment control shall be used where most appropriate. Alarms and status shall be tied to the SCADA system. Improvements shall be coordinated with CITY staff so that they align with existing City standards. Design shall be based on the use of Ethernet interfaces from VFDs to the SCADA system. The Detailed Design task shall include the following: Task 2.1 60% Design The 60% Design task shall include the following: • Updated drawings for Process/Mechanical, Structural, Electrical, and I&C disciplines. Drawing number designations shall follow the RWQCP Building/Process Area Identification Number format. The 60% Design drawings shall have sufficient details that can be used in the CITY's building permit review process. • Technical specifications that focus on major Project components and special provisions specifications that focus on construction sequencing constraints. Work related to the rehabilitation of the PSTs and Top -Deck electrical components (including MCCs F, G, and H) will require one or more shutdowns of specific systems. The specifications shall capture the specific requirements and limitations that must be included in the Contract Documents to minimize disruption to the ongoing treatment operations. • Updated OPCC - accuracy range of+30% / -15% conforming to AACE Class 3 Estimate. • Construction sequencing restraints and conceptual construction schedule. The schedule will be used to identify viable construction sequence scenarios; the actual construction schedule will be developed and submitted by the Contractor following the award of the construction contract. • Design Review Workshop #1 (60% Design) Professional Services Rev. Apri127, 2016 18 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 For the 60% Design drawings and specifications, CONSULTANT shall submit four (4) hardcopy sets, one (1) electronic set (as PDF), and one (1) electronic set in Microsoft Word format (Specifications only). Drawings at this stage will be submitted at half-size (11"x17"). Specifications shall follow the CSI 2016 MasterFormat. CONSULTANT shall submit the 60% Design level OPCC as one (1) hardcopy and one (1) electronic copy (as PDF). CONSULTANT shall submit a 60% Design and conceptual construction schedule as one (1) hardcopy and one (1) electronic copy (as PDF). Task 2.2 90% Design CONSULTANT shall prepare a set of project drawings and specifications developed to a 90% level of design development. The 90% Design task shall include the following: • Updated drawings • Updated specifications • Updated OPCC - accuracy range of +15% / -5% conforming to AACE International's standard for a Class 2 Estimate • Updated construction sequencing restraints and conceptual construction schedule • Design Review Workshop #2 (90% Design) • Review of CITY Front End documents and provide coordination comments or risk mitigation suggestions. For the submission of the 90% Design drawings and specifications, CONSULTANT shall submit four (4) hardcopy sets, one (1) electronic set (as PDF), and one (1) electronic set in Microsoft Word format (Specifications only). Drawings at this stage shall be submitted at half-size. CONSULTANT shall submit the 90% Design level OPCC as one (1) hardcopy and one (1) electronic copy (as PDF). CONSULTANT shall submit the 90% Design and conceptual construction schedule as one (1) hardcopy and one (1) electronic copy (as PDF). Task 2.3 Final Design Final Design shall include preparation of construction documents (final design drawings and specifications) which are ready for CITY's bid solicitation. The Final Design task shall include the following: • Updated drawings • Updated specifications • Updated OPCC - accuracy range of+15% / -5% conforming to the AACE International's standard for a Class 2 Estimate. • Updated construction sequencing restraints and conceptual construction schedule • Contract Documents (Front End) Coordination — references to the CITY's construction General Conditions (GCs) will be updated in the Technical Specifications and Special Provisions, as Professional Services Rev. Apri127, 2016 19 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 required, to produce a consistent set of Contract Documents. Final steps for generating a construction document will be completed under Task 3. For the submission of the 100% Design drawings and specifications, CONSULTANT shall submit two (2) hardcopy sets, one (1) electronic set (as PDF), and one (1) electronic set in Microsoft Word format (Specifications only) and in AutoCAD (Drawings). Drawings at this stage shall be submitted at half-size with the option to provide full-size drawings at the CITY's request. CONSULTANT shall submit the 100% Design level OPCC as one (1) hardcopy and one (1) electronic copy (as PDF). CONSULTANT shall submit the 100% Design conceptual construction schedule as one (1) hardcopy and one (1) electronic copy (as PDF). Task 3 Engineering Services during Bidding (SDB) • CONSULTANT shall assist CITY in preparation of construction bid package/s (IFBs) by preparing the bid form and reproducible versions of the stamped drawings and technical specifications. • CONSULTANT shall respond to the requests for clarification and/or information (RFI) from prospective bidders. • CONSULTANT shall assist CITY with preparation of IFB addenda and furnish the originals required for said addenda. • CONSULTANT shall attend and assist CITY at the pre -bid conference and the job walk. • CONSULTANT shall produce a set of conformed construction documents by incorporating the addenda into the bid documents including drawings and specifications. • Submit the stamped drawings and technical specifications as one (1) electronic copy (as PDF). Task 4 Engineering Services during Construction • During construction phase, CONSULTANT shall confirm the conditions of the Primary Effluent Channel, 36 -inch RAS line and 72 -inch bypass gate as identified during the design phase; and confirm the adequacy of the planned improvements. Assessments shall include visual observation and hand -probing of the in -situ concrete, piping, gate and coating. The CITY will direct and coordinate with the construction contractor to isolate the primary effluent channel (e.g., bypass the flows) to allow for CONSULTANT to perform the assessment work. Should a need for more extensive testing (concrete sampling and testing) or additional improvements be identified, CONSULTANT shall prepare documentation necessary for the CITY to issue a directive to the construction contractor. A construction allowance shall be specified in the construction Invitation for Bid (IFB) document, to be prepared under Task 2, to cover the cost of the aforementioned additional improvements. • CONSULTANT shall review submittals from the contractor for conformance with the Contract Documents. CONSULTANT shall review and return the submittal comments to CITY within fourteen calendar days. Professional Services Rev. Apri127, 2016 20 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 • CONSULTANT shall prepare written responses to the Requests for Information (RFIs) submitted by the contractor. CONSULTANT shall review, comment and return the RFI responses within seven calendar days. • CONSULTANT shall review and validate the Contract Change Order requests submitted by contractor for accuracy and correctness, as requested by CITY. • As requested, CONSULTANT shall attend Pre -Construction Conference and periodic Project Progress Meetings with the Contractor, which are expected to have a duration of two hours. Based on a 20 -month construction schedule, expected meeting attendance by CONSULTANT will be weekly for the first twelve months, bi-weekly for the next six months, and monthly for the last two months • Consultant shall make monthly site visits to the project over the construction duration. Where possible, to increase efficiency, these visits may occur on the same day as the Project Progress Meetings with the Contractor. • At the completion of the construction, CONSULTANT shall assist CITY in identifying deficiencies or non-compliance of the project documents by participating in walk through and creating a "punch list". • CONSULTANT shall provide the technical support to CITY during functional testing, start up and commissioning of the equipment. CONSULTANT shall work with Contractor and equipment manufacturer's representatives, as requested by CITY. • CONSULTANT shall periodically review the "as -built" or "red line" drawings and documents maintained by the contractor during construction. Upon construction completion, CONSULTANT shall prepare record drawings per contractor furnished "red lined" or "as -built" drawings. The record drawings shall consist of annotated contract drawings and electronic files showing changes in design and construction. • The construction contractor will be responsible for submitting the O&M Manuals. CONSULTANT shall review contractor furnished O&M Manuals for completeness and to ensure that appropriate information is included in the manuals for use by the Plant staff. • CONSULTANT shall provide the record drawings as hard copies (one full size and two half size sets) and electronic copies. The electronic copies shall be, one in AutoCAD 3D Civil 2010 and other in PDF format. Task 5 Project Management CONSULTANT shall provide a competent project manager to direct, organize and coordinate, and consolidate the design team efforts to meet project goals and objectives. The project manager will supervise and provide direction to the team members as well as to the sub -consultants. The project management task involves: • Prepare and distribute a Project Memorandum to include scope of work, schedule, budget, key City and Consultant roles, contact information, QA/QC plan, invoicing procedures, and a safety plan. • Prepare monthly progress report for submission to CITY. At the least the report shall include the progress for each subtask budget status, outstanding issues, potential project scope changes, and schedule impacts. Professional Services Rev. Apri127, 2016 21 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 • During Tasks 1 and 2, update the design project schedule, if necessary, and discuss with the CITY monthly. • Coordinate brief weekly project coordination calls with CITY staff. Summarize and distribute action items from these calls. Significant issues will be handled in separate meetings. • Conduct internal team meetings to review progress, coordinate evaluations, and identify information needs. • Monitor project budget for effort versus progress and keep CITY informed of the status. Identify and mitigate potential overruns. • Manage sub -consultants. • Manage QA/ QC team. • Prepare a project -specific Health and Safety Plan (HASP) and a Hazard Appraisal and Recognition Plan (HARP) when field work is anticipated. The CONSULTANT shall review and approve the HASP/HARP submitted by subcontractors, as appropriate. III. Reimbursable CONSULTANT shall follow the CITY's policies on preparing records and bills for reimbursable. Fees shall include miscellaneous costs incurred, such as travel, large document production efforts, and postage expenses. These costs are to be reimbursed at cost. IV. Additional Services The CONSULTANT shall provide additional services only by advanced, written authorization from the CITY. The CONSULTANT, at the CITY 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 Project Manager and CONSULTANT prior to commencement of the services. Payment for additional services is subject to all requirements and restrictions in this Agreement. The CITY reserves the right to request additional services from Consultant as described below. Item (A): Condition Assessment of the Primary Effluent Channel, 36 -Inch RAS Line and 72 -Inch Bypass Slide Gate when the Primary Effluent Channel is taken out of Service If weather permits (i.e., during dry weather season only), the CITY may perform plant -wide shut down for up to 6 hours to allow the CONSULTANT to perform a more in-depth assessment of the conditions of the Primary Effluent Channel, 36 -inch RAS line and the 72 -inch bypass gate. CONSULTANT shall perform the assessment concurrent with Task 1.4. The CITY will: i. Perform plant -wide shut down (stop influent flows) for up to 6 hours. Professional Services Rev. Apri127, 2016 22 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 ii. Install a necessary bypass pumping system to pump down the flows in the primary effluent channel iii. Take the existing RAS line out of service, empty it, and flush/clean it. iv. Disassemble the Victaulic couplings on the existing RAS pipe. v. Remove the pipe section between the Victaulic couplings, as needed. vi. Set up necessary apparatus for confines space entry by CITY's employees and CONSULTANT. CONSULTANT shall ensure that each entrant is trained for confined space entry and equipped with appropriate PPE. CONSULTANT shall perform visual inspection of the interior surfaces of the Primary Effluent Channel and arrange subcontractors for CCTV inspection of the 36 -inch RAS pipe and visual inspection of the 72 - inch bypass gate (gate shall remain in closed position). ITEM (B): Structural Design — New Electrical Enclosure Under Task 1.5, should Alternative 1, 2 or 3 be chosen as the preferred alternative for siting the replacement MCCs, CONSULTANT shall perform the structural analysis and design services associated with the selected alternative under this task - Item (B). The services shall include: A. Geotechnical exploration (that includes one boring) by a professional geotechnical consulting firm subcontracted to the CONSULTANT. B. Structural analysis and design equivalent to that associated with a pile -supported slab suitable for the support of a stand-alone, factory -assembled electrical enclosure, and the development of associated drawings and technical specifications. 60%, 90% and Final Design drawings and specifications shall be incorporated into Task 2 deliverables. CITY review processes and discussions shall be incorporated with Task 2 review workshops and responses to comments. C. Development of a written report documenting the results of the structural analysis and required improvements. D. Attendance at a design review meeting with the CITY (as part of Task 1.5D and Task 2 workshops) to review and discuss the structural analysis and proposed improvements. ITEM (C): CEQA Documentation Services as required In the event the City determines that the Project is not exempt from CEQA and requests the CONSULTANT to perform this task, CONSULTANT shall execute this task —by engaging a subconsultant approved by the City to prepare an Initial Study and/or other documents necessary for CEQA clearance. The subconsultant shall work in direct coordination the City's Department of Planning and Community Environment. ITEM (D): Other Engineering Services as required Professional Services Rev. Apri127, 2016 23 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 At the request of the CITY Project Manager, CONSULTANT shall provide other additional services to resolve unforeseen site conditions that are not in the scope of Basic Services. Professional Services Rev. April 27, 2016 24 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 EXHIBIT "B" SCHEDULE OF PERFORMANCE CONSULTANT shall perform the Services so as to complete each milestone within the number of days/weeks specified below. The time to complete each milestone may be increased or decreased by mutual written agreement of the project managers for CONSULTANT and CITY so long as all work is completed within the term of the Agreement. CONSULTANT shall provide a detailed schedule of work consistent with the schedule below within 2 weeks of receipt of the notice to proceed (NTP). Milestones Completion No. of Weeks from NTP 1. Design Kick-off Meeting 2 2. Definition Workshop #1 5 3. PSTs Inspection 9 4. Definition Workshop #2 11 5. Draft Preliminary Design Report 13 6. Final Preliminary Design Report 17 7. Design - 30% Deliverable 17 8. Preliminary Design Report Review Workshop 15 9. CEQA/ CATEX Project Descriptions 17 10. SRF Engineer's Project Report 17 11. Design - 60% Deliverable 26 12. Design Review Workshop #1 28 13. Design - 90% Deliverable 37 14. Design Review Workshop #2 39 15. Design - 100% Deliverable 43 16. Engineering Services during Bidding 50 17. Engineering Services during Construction 154 Professional Services Rev. Apri127, 2016 25 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 EXHIBIT "C" COMPENSATION The CITY agrees to compensate the CONSULTANT for professional services performed in accordance with the terms and conditions of this Agreement, and as set forth in the budget schedule below. Compensation shall be calculated based on the hourly rate schedule attached as Exhibit C-1 up to the not to exceed budget amount for each task set forth below. CONSULTANT shall perform the tasks and categories of work as outlined and budgeted below. The CITY's Project Manager may approve in writing the transfer of budget amounts between any of the tasks or categories listed below provided the total compensation for Basic Services, including reimbursable expenses, and the total compensation for Additional Services do not exceed the amounts set forth in Section 4 of this Agreement. BUDGET SCHEDULE Task 1 (Preliminary Design) Task 2 (Detailed Design) Task 3 (Engineering Services during Bidding) Task 4 (Engineering Services during Construction) Task 5 (Project Management) Subtotal Basic Services Reimbursable Expenses Total Basic Services and Reimbursable expenses Additional Services Not Included in Basic Services Maximum Total Compensation NOT TO EXCEED AMOUNT $285,660 $188,884 $ 18,901 $119,863 $ 30,430 $643,738 $ 6,597 $650,335 $ 65,034 $715,369 26 Professional Services Rev. Apri127, 2016 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 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 $1,000 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 Professional Services Rev. Apri127, 2016 27 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 EXHIBIT "C-1" SCHEDULE OF RATES Kennedy/Jenks Consultants. Inc. Billing Classification: Hourly Rate: CAD -Technician $132 Engineer -Scientist -Specialist 1 $118 Engineer -Scientist -Specialist 2 $141 Engineer -Scientist -Specialist 3 $155 Engineer -Scientist -Specialist 4 $168 Engineer -Scientist -Specialist 5 $182 Engineer -Scientist -Specialist 6 $205 Engineer -Scientist -Specialist 7 $228 Engineer -Scientist -Specialist 8 $246 Engineer -Scientist -Specialist 9 $264 Project Administrator $109 Notes: 1. Above rates are effective from notice to proceed date through December 31, 2018. 2. Rates to be escalated 3 per cent per year thereafter. 3. Rates include salary, overhead and profit. 4. Sub -consultants will be billed at cost plus 10%. Professional Services Rev. Apri127, 2016 28 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: National Plant Services Scope of Work: To provide wastewater facility cleaning and inspection services as ordered and directed by Kennedy/Jenks. Rates: The following schedule of rates and charges will apply to the performance of this work (tasks in bold below are planned to be performed for this Project): 1. Jet/Vac Unit w/Operator @ $220.00/Hr ST $260.00/Hr OT $300.00/Hr PT 2. CCTV Unit w/ Operator @ $200.00/Hr ST $240.00/Hr OT $280.00/Hr PT 3. Jet/Vac Unit w/Operator & Tech w/utility truck @ $340.00/Hr ST $410.00/Hr OT $480.00/Hr PT 4. Additional Tech @ $120.00/Hr ST $150.00/Hr OT $180.00/Hr PT 5. Heavy Industrial Air -Moving Unit w/Operator @ $240.00/Hr ST $280.00/Hr OT $320.00/Hr PT 6. BL Vacuum Truck w/Operator @ $200.00/Hr ST $240.00/Hr OT $280.00/Hr PT 7. Grouting Unit w/Operator @ $250.00/Hr ST $290.00/Hr OT $330.00/Hr PT 8. Materials/Supplies @ Cost plus 15% (sand bags, bleach, etc.) 9. Equipment Rentals @ Cost plus 15% (pressure cleaners, boom trucks, arrowboards, etc.) 10. CCTV Unit w/Lateral Launch @ $250.00/Hr ST $290.00/Hr OT $330/Hr PT 11. CCTV/Sonar unit & Winch Truck w/2 Techs @ $3.50-$6.00/LF (Depending on job specifics) 12. CCTV/Sonar/Laser MSI Unit w/3 Techs @ $5.50-$9.00/LF (Depending on job specifics) 13. Sonar processing $0.5-$2.00/LF 14. Laser Processing $2.50-3.50/LF 15. PACP coding of CCTV videos $0.25-.50/LF (applies to MSI inspections only) 16. Mobilization/Demobilization Charges and traffic control will be determined by Job Scope and Equipment Requirements Professional Services Rev. Apri127, 2016 29 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 EXHIBIT "C-1" (continued) SUB -CONSULTANT RATES Sub -consultant Firm Name: Testing Engineers, Inc. Scope of Work: To provide concrete testing services as ordered and directed by Kennedy/Jenks (tasks in bold below are planned to be performed for this Project):: Rates: A. CONSULTING - Hourly and Unit Rates for Testing and Laboratory Tests • Coring, Pu11/Load Testing, Ground Penetrating Radar (GPR) - 2 -man Crew (Confined Space Trained Rate/hr.: $265/hour • Engineer Report Preparation Rate/hr.: $ 160/hour • Laboratory Concrete Compressive Strength Testing Rate/core: $85/core • Laboratory Carbonization Testing on Cores by pH Methods w/Phenolphthaleim Rate/core: $85/core B. CONSULTING - Service Unit Rate • Concrete Coring I Compressive Strength/ Carbonization I Non -Shrink Grout Repair/travel Rate/core: $615/core • Pull/Load Testing - Lift Hanger Rate/test: $205/test • GPR Rate/day: $2,500/day • Report with Results Rate/report: $ 1,300/report Services will be billed from portal to portal in 4 and 8 -hour increments. Above rates do not account for any overtime. In addition, the rates provided assume the work will be completed within the hours of 6:00 am and 6:00 pm during the weekday. If night shift rates are requested, Testing Engineers, Inc. will provide updated rates to Kennedy/ Jenks Consultants. Professional Services Rev. Apri127, 2016 30 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 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: MINIMUM LIMITS REQUIRED TYPE OF COVERAGE REQUIREMENT EACH OCCURRENCE AGGREGATE YES WORKER'S COMPENSATION STATUTORY YES EMPLOYER'S LIABILITY STATUTORY BODILY INJURY $1,000,000 $1,000,000 YES GENERAL LIABILITY, INCLUDING PERSONAL INJURY, BROAD FORM PROPERTY DAMAGE $1,000,000 $1,000,000 PROPERTY DAMAGE BLANKET CONTRACTUAL, AND FIRE LEGAL BODILY INJURY & PROPERTY DAMAGE $1,000,000 $1,000,000 LIABILITY COMBINED. BODILY INJURY 1 $1,000,000 $1,000,000 - EACH PERSON $1,000,000 $1,000,000 - EACH OCCURRENCE $1,000,000 $1,000,000 YES AUTOMOBILE LIABILITY, INCLUDING ALL OWNED, HIRED, NON -OWNED PROPERTY DAMAGE $1,000,000 $1,000,000 BODILY INJURY AND PROPERTY $1,000,000 $1,000,000 DAMAGE, COMBINED YES PROFESSIONAL LIABILITY, INCLUDING, ERRORS AND OMISSIONS, MALPRACTICE (WHEN APPLICABLE), AND NEGLIGENT PERFORMANCE ALL DAMAGES $1,000,000 YES THE CITY OF PALO ALTO IS TO BE NAMED AS AN ADDITIONAL INSURED: CONTRACTOR, AT ITS SOLE COST AND EXPENSE, SHALL OBTAIN AND MAINTAIN, IN FULL FORCE AND EFFECT THROUGHOUT THE ENTIRE TERM OF ANY RESULTANT AGREEMENT, THE INSURANCE COVERAGE HEREIN DESCRIBED, INSURING NOT ONLY CONTRACTOR AND ITS SUBCONSULTANTS, IF ANY, BUT ALSO, WITH THE EXCEPTION OF WORKERS' COMPENSATION, EMPLOYER'S LIABILITY AND PROFESSIONAL INSURANCE, NAMING AS ADDITIONAL INSUREDS CITY, ITS COUNCIL MEMBERS, OFFICERS, AGENTS, AND EMPLOYEES. I. INSURANCE COVERAGE MUST INCLUDE: A. A PROVISION FOR A WRITTEN THIRTY (30) DAY ADVANCE NOTICE TO CITY OF CHANGE IN COVERAGE OR OF COVERAGE CANCELLATION; AND B. A CONTRACTUAL LIABILITY ENDORSEMENT PROVIDING INSURANCE COVERAGE FOR CONTRACTOR'S AGREEMENT TO INDEMNIFY CITY. C. DEDUCTIBLE AMOUNTS IN EXCESS OF $5,000 REQUIRE CITY'S PRIOR APPROVAL. II. CONTACTOR MUST SUBMIT CERTIFICATES(S) OF INSURANCE EVIDENCING REQUIRED COVERAGE AT THE FOLLOWING IRL: https://www.planetbids.com/portal/portal.cfm?CompanyID-25569. III. ENDORSEMENT PROVISIONS, WITH RESPECT TO THE INSURANCE AFFORDED TO "ADDITIONAL INSUREDS" A. PRIMARY COVERAGE WITH RESPECT TO CLAIMS ARISING OUT OF THE OPERATIONS OF THE NAMED INSURED, INSURANCE AS AFFORDED BY THIS POLICY IS PRIMARY AND IS NOT ADDITIONAL TO OR CONTRIBUTING WITH ANY OTHER INSURANCE CARRIED BY OR FOR THE BENEFIT OF THE ADDITIONAL INSUREDS. Professional Services Rev. Apri127, 2016 31 DocuSign Envelope ID: 3326D938-C44C-4B4E-B033-09B44D930C65 B. CROSS LIABILITY THE NAMING OF MORE THAN ONE PERSON, FIRM, OR CORPORATION AS INSUREDS UNDER THE POLICY SHALL NOT, FOR THAT REASON ALONE, EXTINGUISH ANY RIGHTS OF THE INSURED AGAINST ANOTHER, BUT THIS ENDORSEMENT, AND THE NAMING OF MULTIPLE INSUREDS, SHALL NOT INCREASE THE TOTAL LIABILITY OF THE COMPANY UNDER THIS POLICY. C. NOTICE OF CANCELLATION 1. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR ANY REASON OTHER THAN THE NON-PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A THIRTY (30) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. 2. IF THE POLICY IS CANCELED BEFORE ITS EXPIRATION DATE FOR THE NON- PAYMENT OF PREMIUM, THE CONSULTANT SHALL PROVIDE CITY AT LEAST A TEN (10) DAY WRITTEN NOTICE BEFORE THE EFFECTIVE DATE OF CANCELLATION. VENDORS ARE REQUIRED TO FILE THEIR EVIDENCE OF INSURANCE AND ANY OTHER RELATED NOTICES WITH THE CITY OF PALO ALTO AT THE FOLLOWING URL: HTTPS://W W W.PLANETBIDS.COM/PORTAL/PORTAL.CFM? C OMPANYID=25569 OR HTTP://WWW.CITYOFPALOALTO.ORG/GOV/DEPTS/ASD/PLANET BIDS HOW TO.ASP Professional Services Rev. Apri127, 2016 32 CITY of City of Palo Alto (ID # 9460) PALO ALT© City Council Staff Report Report Type: Action Items Meeting Date: 12/3/2018 Summary Title: Downtown Cap: Repeal of PAMC Chapter 18.18.040 Title: PUBLIC HEARING. Adoption of an Ordinance Amending Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Repeal Section 18.18.040 Regarding a Nonresidential Square Footage Cap in the CD Downtown Commercial Zoning District to Implement and Conform to the Updated Comprehensive Plan; Section 18.18.040 Implemented Policy L-8 of the Prior 1998 Comprehensive Plan, Which was Removed as Part of the Adoption of the Comprehensive Plan Update. California Environmental Quality Act (CEQA), This Ordinance is Within the Scope of the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720 From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that the City Council take the following actions: 1. Find the Ordinance within the scope of the Comprehensive Plan Environmental Impact Report (EIR) certified and adopted on November 13, 2017 by Council Resolution No. 9720; and, 2. Adopt an ordinance implementing City Council direction from January 30, 2017 to repeal Palo Alto Municipal Code (PAMC) section 18.18.040 regarding a nonresidential floor area restriction in the CD Downtown Commercial Zoning District. Background Palo Alto Municipal Code (PAMC) section 18.18.040 implements Land Use Program L-8 from the 1998 Comprehensive Plan. This program and code section establish a development ceiling that prevents more than 350,000 square feet of non-residential floor area from being developed in City of Palo Alto Page 1 the City's downtown commercial district. The program directed that the City re-evaluate the limit once new non-residential development approvals reached 235,000 square feet of floor area. City staff and consultants commenced this re-evaluation after that intermediate threshold was reached, during the City's Comprehensive Plan update process. On January 30, 2017, as part of its consideration of the Comprehensive Plan update, the City Council directed the removal of the downtown -specific non-residential floor area limit in Land Use Program L-8 in favor of a new policy objective'. The new policy would limit office and research and development ("office/R&D") floor area on a citywide basis, capping new development at 1.7 million square feet. In November 2017, the Council adopted that new policy with the Council's final approval of the updated Comprehensive Plan. In summer 2018, Council amended the Comprehensive Plan to reduce the citywide office/R&D cap by half to 850,000 square feet following the certification of a citizen's initiative to affect this change. In addition to the citywide office/R&D limit, the City Council in May 2018 adopted a zoning code amendment replacing interim regulations and establishing a 50,000 square foot annual limit on new office space that applies to downtown, California Avenue Area and El Camino Real on an ongoing basis. Following prior Council direction, staff initiated a text amendment to repeal PAMC section 18.18.040 last summer. The Planning and Transportation Commission (PTC) considered this ordinance and recommended (4-0-1) that the Council reject it. The PTC expressed concerns about the then -pending citizen's initiative and the perceived inconsistency of removing the downtown non-residential floor area restriction with the City's expressed interest in encouraging more housing development. The contemplated conversion of residential units at the President Hotel was cited as an example of how allowing commercial development could be contrary to other City efforts to encourage the retention and production of housing units. Over 20 speakers expressed concern about the ordinance at the PTC meeting. More on the Commission meeting and verbatim minutes are provided in Attachment C. Discussion The subject ordinance seeks to implement what staff understood to be the Council's direction on January 30, 2017 to eliminate a downtown -specific cap on non-residential development and instead rely upon the citywide office/R&D floor area limit and the 50,000 square foot annual limit in three areas (downtown, along El Camino Real and near California Avenue). The preferred scenario as described in the Comprehensive Plan Final EIR also included the same provisions — the citywide cumulative office/R&D cap of 1.7 million square feet, an assumed annual office/R&D limit to control the pace of growth, and the elimination of the separate cap 1 Action minutes from the City Council meeting are available online: https://www.cityofpaloalto.org/civicax/filebank/documents/56153 City of Palo Alto Page 2 that applies to Downtown. In reviewing the administrative record of the Comprehensive Plan update, staff was unable to find any contrary discussion that would support the view that the Council expected or contemplated that non-residential development downtown would be limited to the remaining floor area that exists under the downtown cap, which today is approximately 19,000 square feet. Downtown Non -Residential SQFT Added (1986 to Present) 350.000 277 1( 143 K 100 K 97 K I• 47 K Cumulative SFQT Five Yearly Addition Source : City of Palo Alto Planning Department, Accela Data, October 31, 2019 • Includes Entitled and Pending Projects If the Council intends to retain the downtown cap, staff would need to conduct additional environmental analysis to evaluate how this change in policy direction impacts the land use assumptions and conclusions in the final environmental impact report prepared for the Comprehensive Plan update. Additionally, it is recommended that, if Council does not adopt the proposed ordinance repealing PAMC section 18.18.040 in its entirety, that the Council approve amending Section 18.18.040 to ensure the retention of the downtown development standards in PAMC Chapter 18.18 (Downtown Commercial (CD) District). Section 18.18.040 currently states that Chapter 18.18 as whole, including all of the downtown land use and development regulations, would be repealed once the City reaches 350,000 square feet of non-residential floor area from the 1986 base year. City of Palo Alto Page 3 Attachment A provides a copy of the proposed ordinance that would repeal PAMC section 18.18.040. Attachment B includes the prior and current Comprehensive Plan programs and additional background information. Timeline If the Council approves the proposed ordinance, a second reading of the ordinance would be scheduled as a consent calendar item for final adoption. Thirty days after the second reading, PAMC section 18.18.040 would be removed from the Municipal Code. Environmental Review The proposed Ordinance is within the scope of and in furtherance of the Comprehensive Plan 2030 which was evaluated in the Comprehensive Plan Final Environmental Impact Report (Final EIR) certified and for which findings were adopted by Council Resolution Nos. 9720 and 9721 on November 13, 2017, in accordance with the California Environmental Quality Act (CEQA). Pursuant to Section 15168 of the State CEQA Guidelines, the City has determined that no new effects would occur from and no new mitigation measures would be required for the adoption of this Ordinance. Attachments: Attachment A: Draft Ordinance Chapter 18.18 (Downtown CD) to Repeal Downtown Development Cap (PDF) Attachment B: Comp Plan Policies (PDF) Attachment C: PTC Minutes (PDF) City of Palo Alto Page 4 ** NOT YET ADOPTED DRAFT Ordinance No. Ordinance of the Council of the City of Palo Alto Amending Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Repeal Section 18.18.040 Relating to a Nonresidential Square Footage Cap in the CD Downtown Commercial Zoning District to Implement and Conform to the Updated Comprehensive Plan 2030 The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. Findings and Declarations. The City Council finds and declares as follows: A. The 1998 Comprehensive Plan for the City of Palo Alto included a program, Land Use Program L-8, to limit new nonresidential development in the Downtown area to 350,000 square feet or 10 percent above the amount of development existing or approved as of May 1986 (the "Downtown cap"), and to re-evaluate this limit when nonresidential development reached 235,000 square feet. This program perpetuated the already existing Downtown cap adopted in 1986 by Ordinance No. 3696 which had amended the Zoning Code to add a new chapter codifying the Downtown cap. B. Beginning in 2013, when Downtown nonresidential development was approaching 235,000 square feet, the City re-evaluated the Downtown cap, studying land use and traffic conditions and impacts, at the same time that the Comprehensive Plan update process was underway. C. As part of Council's process for adoption of the updated Comprehensive Plan in 2017, the Council determined to maintain a cumulative citywide cap on nonresidential development of 1.7 million square feet and apply it to office/R&D development only with certain exemptions, to continue on an ongoing basis the annual limit on office/R&D development by a separate ordinance, and to eliminate the 350,000 square foot cap on nonresidential development in the Downtown in then -existing Program L-8 and focus on monitoring development and parking demand. Accordingly, former Program L-8 is not included in the Comprehensive Plan 2030 as adopted by the Council on November 13, 2017. D. This Ordinance, which would remove the Downtown cap from the Zoning Code, implements and is in furtherance of the updated Comprehensive Plan 2030. SECTION 2. Section 18.18.040 (Repeal of Regulations) of Chapter 18.18 (Downtown Commercial (CD) District) of Title 18 (Zoning) is repealed in its entirety. 18.18.040 Rc. cal of Regulations jb SL/Amending ORD 18.18 (DC) District 1 July 2018 The department of planning and community environment shall monitor the number of square feet approved for nonresidential development in the CD district and the number of square feet approved for nonresidential development pursuant to a planned community (PC) zone if the site of the PC zone was within the CD district on the effective date of this chapter. When 350,000 square feet of nonresidential development have received final design review approval pursuant to Chapter 18.76 or have received building permits, if no design approval is required, this chapter shall be repealed and a moratorium shall be imposed. This moratorium shall prohibit the city' a ptaRee „ of - plication f„r p ng approval or a building permit for new nonresidential square footage in the CD district. This moratorium shall remain in effect for one year while the city undertakes a study of what regulations would be appropriate in the CD district. The moratorium may be extended by the council until such study is completed and appropriate regulations arc implemented. SECTION 3. Any provision of the Palo Alto Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance. SECTION 4. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional. SECTION 5. The Council finds that the Ordinance is within the scope of and in furtherance of the Comprehensive Plan 2030 which was evaluated in that certain Final Environmental Impact Report ("Final EIR") certified and for which findings were adopted by Council Resolution Nos. 9720 and 9721 on November 13, 2017, all in accordance with the California Environmental Quality Act ("CEQA"). Pursuant to Section 15168 of the State CEQA Guidelines, the City has determined that no new effects would occur from and no new mitigation measures would be required for the adoption of this Ordinance. SECTION 6. This Ordinance shall be effective on the thirty-first date after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: jb SL/Amending ORD 18.18 (DC) District 2 July 2018 ABSTENTIONS: NOT PARTICIPATING: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Assistant City Attorney City Manager Director of Planning & Community Environment jb SL/Amending ORD 18.18 (DC) District 3 July 2018 Attachment B Comprehensive Plan Policies and Additional Background Information 1998 Comprehensive Plan Program L-8: Limit new non-residential development in the Downtown area to 350,000 square feet, or 10% above the amount of development existing or approved as of May 1986. Reevaluate this limit when non-residential development approvals reach 235,000 square feet of floor area. Current Comprehensive Plan Policy L1.10: Cap new square feet of office/R&D development citywide at 850,000 square feet, exempting medical office uses in the Stanford University Medical Center (SUMC) vicinity. Use January 1, 2015 as the baseline and monitor development towards the cap on an annual basis. Continue to exempt medical, governmental and institutional uses from the cap on office/R&D development. Note: PAMC Chapter 18.18.040 codified a maximum growth of 350,000 square feet and stipulated that the CD development cap was to be re-evaluated when net new non-residential development reached 235,000 square feet. A moratorium would come into effect as soon as 350,000 square feet of new non-residential development receives either planning entitlements or building permits. As required by the Comprehensive Plan and Zoning Code, City staff has monitored and prepared annual reports to the City Council regarding development activity, vacancy rates and commercial lease rates in order to evaluate the effectiveness of these regulations. As of October 30, 2018, the new non-residential development downtown, including approved and pipeline projects, has not been exceeded. Approximately 330,792 square feet has been entitled or is in the pipeline and approximately 19,208 square feet remains. Consistent with PAMC section 18.18.040, the City initiated a study in 2013 to re-evaluate the downtown cap for land use and traffic conditions and other impacts, when the total amount of new nonresidential square footage approached 235,000. The City Council awarded a contract In October 2013 for Downtown Development Cap Study to Dyett and Bhatia Urban and Regional Planners. This analysis was proposed to be completed in two phases. Phase I focused on data collection and projection analysis, while Phase II was to be the policy analysis phase. Phase I was completed and the associated studies were submitted to both the PTC and City Council for review. The studies included existing trends and conditions, downtown development cap evaluations and a downtown business survey. Phase II was stayed given Council direction on January 30, 2017 to end the Downtown non-residential floor area limitation. Attachment C PTC Summary and Transcript Planning & Transportation Commission Meeting The PTC held a public hearing on this item on July 25, 20181. There were 21 members of the public who spoke on this proposed zoning code amendment. The majority of speakers voted in favor of retaining the existing downtown commercial cap. While many of the speakers supported retention of the downtown cap due to concerns about traffic and potential conversion of residential square footage to nonresidential uses, some were directly the result of the proposed conversion of the President Hotel residences to a hotel use. Some speakers also asked that this issue be studied further in light of recent policy direction, the pending citizen initiative on the citywide office/R&D growth cap, and so that the impact, including the environmental impact, could be clearly understood. There were also a number of speakers who requested that the focus be placed on providing more renter protection instead. Following the public speakers, the PTC held a detailed discussion which also echoed much of what was raised by the public. While a commissioner noted that there was some concern that the retention of PAMC Chapter 18.18.040 would conflict with the January 30, 2017 Council motion to remove the downtown cap from the Comp Plan, it was also acknowledged that the downtown cap and the overall citywide cap are different because one restricts all commercial downtown only, while the citywide cap restricts only office and R&D uses. The PTC stated that action on the subject ordinance appeared to be premature for several reasons. One of the biggest reasons was the upcoming (at the time) citizen initiative to reduce the overall City wide cap. The perception was that the removal of the downtown commercial square footage cap would be inconsistent with the citizen initiative to reduce in the allowable office and R&D square footage city wide. The reduction was approved by Council five days after this PTC hearing, preempting the placement of the measure on the November ballot. Another reason was that the removal of the restriction on commercial square footage was seen to contradict the more recent policy support for housing, including the zoning code amendments being considered to implement the Comp Plan policies to increase housing production (Housing Work Plan). The PTC expressed that the removal of the restriction on commercial square footage would encourage more commercial development instead of housing. There was specific concern that the removal of the downtown commercial cap would encourage conversion of residential units to commercial uses. The proposed conversion of the President Hotel from residential units to a hotel was held as one significant example. The PTC was concerned that the motion to remove the downtown cap, made in January 2017, did not reflect more current policy direction and Council positions and that more time should be spent to evaluate the more recent discussions before taking any action on the subject code section. At the conclusion of the public hearing, the PTC adopted a motion that recommended that City Council reject staff's proposal to repeal PAMC Chapter 18.18.040. 1 PTC Hearing July 25, 2018 Staff Report and Minutes 1 2 Action Items 3 Public Comment is Permitted. Applicants/Appellant Teams: Fifteen (15) minutes, plus three (3) minutes rebuttal. 4 All others: Five (5) minutes per speaker.1,3 5 6 2. Public Hearing: Recommend that the City Council Adopt an Ordinance Amending 7 Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto 8 Municipal Code to Repeal Section 18.18.040 Regarding a Nonresidential Square 9 Footage Cap in the CD Downtown Commercial Zoning District to Implement and 10 Conform to the Updated Comprehensive Plan. CEQA: Comprehensive Plan 11 Environmental Impact Report (EIR), Council Resolution No. 9720 12 13 Commission Action: Motion made by Commissioner Waldfogel to Recommend Council reject 14 staff's proposed ordinance, motion seconded by Chair Lauing (friendly amendment by Summa). 15 Motion passed 4-0-1 (Waldfogel, Monk, Lauing, Summa. Alcheck abstained, Gardias and Riggs 16 absent) 17 18 19 Chair Lauing: So as stated the next item on the agenda is Item Number 2 as printed here and 20 that's a recommendation on an ordinance amending Chapter 18. And I believe we're going to 21 have a Staff presentation on that as well from (interrupted) 22 23 Ms. French, Chief Planning Official: Yes, hello again. I'll introduce Elena Lee who is going to be 24 presenting the PowerPoint she prepared. 25 26 Ms. Elena Lee: Thank you Chair and Members of the Commission. So tonight, the proposed 27 repeal of Palo Alto Municipal Code Chapter 18.18.40 is a direct outcome of the Comp. Plan 28 update and per specific Council motion at the January 30th, 2017 Council hearing on the Land 29 Use Element. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 So PAMC 18.18.40 provides the following should certain thresholds be met. First of all, this 3 code chapter involves all non-residential floor area. That would be office, retail -like, not just 4 office and R&D. So, at 350,000 -square feet of non-residential development and as of now we 5 have about 25,000 -square feet left. Chapter 18. 18 would be repealed and a 1 -year moratorium 6 accepting and processing applications in the CD District and the City would study new CD 7 District regulations. 8 9 So, at the January 30th, 2017 City Council hearing on the Land Use... the draft Land Use Element 10 the Council directed that the final Comp. Plan policy be focused on office and R&D uses, that it 11 be applied (interrupted) 12 13 Chair Lauing: Yeah, just go a little bit slower for us. 14 15 Ms. Lee: Sure, sorry about that. 16 17 Chair Lauing: Thanks. 18 19 Ms. Lee: Ok so at the January 30th, 2017 hearing the final draft... the City Council actually 20 directed that the final draft Comp. Plan includes a revised policy that focused the cap on all 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 office and R&D uses only. It would apply City-wide rather than the 9 monitor subareas and it 2 would also require annual monitoring to assess the effectiveness of the development 3 requirements and to determine whether the cap and development requirement should be 4 adjusted. In addition, the Council also directed Staff to make permanent an Annual Office Limit 5 Ordinance of up to 50,000 -square feet per year for office and R&D uses only separate from the 6 Comp. Plan update in the downtown, Cal. Ave, and El Camino Real area. Thirdly the Council 7 directed Staff to eliminate the Downtown Cap found in existing Program L-8 and to focus it on 8 monitoring and development and parking demands. 9 10 So, the previous policy and program are shown here on this slide and in this... under Policy L-8, 11 that second item, it shows that the Comp. Plan stipulated that we have them limit of 3.2 12 million -square -feet of new non-residential development in the 9 planning areas as evaluated in 13 the 1989 Citywide Land Use and Transportation Study. And so that would be focused on 9 14 planning areas that include downtown, Cal. Ave, Research Park, amongst other areas. The 15 associated program specific to downtown said that new non-residential development, again 16 this includes retail as well, in downtown would be limited to 350,000 -square feet or 10 percent 17 above the amount of development existing or approved as of a May 1986 study. And then this 18 limit would be reevaluated when the non-residential development approvals reached 235,000- 19 square feet which happened around 2012. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 So after... through the Comp. Plan update consistent with the January 30th direction the City 2 adopted... City Council adopted new Policy L1.10 which states... said that we should have a City - 3 wide cap of 1.7 million -square -feet. That would be the remaining from the 3.2 million that was 4 identified earlier and that would be for office and R&D development only. Exempting medical 5 uses such as SUMC and then that we would use a January 1st, 2015 as a baseline. In addition, 6 we would monitor development towards a cap on an annual basis and require the monitoring 7 to determine the effectiveness as well as looking at specific measurements to make sure that 8 we are complaining with the policies. And note again that this cap applies only to office R&D so 9 the cap would apply for example if someone converted an office use or sorry, convert a retail 10 use into an office use. Previously under the old Comp. Plan as well as 18.18... Chapter 18 11 currently, if somebody converted retail to office space that wouldn't count against the cap. So 12 that is a difference between the two so that would definitely capture any potential retail uses 13 that would want to convert to office space. So, the associated Program [10.1 stated that we 14 should reevaluate the cumulative cap when the amount of a new development reaches 67 15 percent or 1.139 [note- 1,139,000 slide]. And then concurrently we would consider removing or 16 other potential changes to the cap. 17 18 So, concerns have been raised by the members of the public that this repeal... proposed repeal 19 is inconsistent with the recent direction. This ordinance would bring the Zoning Code into 20 consistency with the recently adopted Comp. Plan. The Comp. Plan also includes provisions for 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 regular evaluation of the cap and a program for the coordinated area plan for downtown. Other 2 policies and programs were also adopted with the Comp. Plan that provides the City with great 3 tools to address development. Including new TDM requirements with required reductions in 4 ranging from 45 percent reduction downtown as well as up to 20 percent else ware in addition 5 to the update to the Transportation Impact Fee. 6 7 So, in summary, Staff recommends a repeal of Chapter 18.18.40 because its consistent with the 8 Comp. Plan update as well as the January 30th motion from City Council. So, the PTC may 9 recommend for or against this ordinance or may continue the hearing to a date certain or 10 uncertain. If the PTC recommends Council adoption or recommends against or against the 11 ordinance, Staff will forward a draft ordinance to the City Council for their review and action. 12 However, if the PT [note-PTC] continues... chooses to continue this item to a date certain or 13 uncertain we would return with this item later that... at that time. This concludes Staff's report. 14 15 Chair Lauing: Amy did you have anything to add? No? 16 17 Ms. French: Not at this time. 18 19 Chair Lauing: Ok. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Ms. French: I'm here for questions. 2 3 Chair Lauing: I think if we want to... if there are any prudent preliminary question from the 4 Commission to Staff we could do that and then we want to go to public comment. Any 5 questions? No? Ok. Commissioner Summa. 6 7 Commissioner Summa: Thank you. Thank you for the report and thank you for everyone in the 8 public for coming out tonight. I have a couple questions and I know that as of January 2017 the 9 cap I believe... the square footage, the commercial count was at 317,000. And I have a question 10 because there's some confusion in the Municipal Code. It says that it's supposed to capture... 11 count square feet and I think that... and so I'm wondering if you have been calculating that 12 number counting square feet or FAR because in not all cases are they the same? 13 14 Ms. French: So square footage is known as Gross Floor Area. The Floor Area Ratio is when that 15 Gross Floor Area is divided by the lot area so when we talk about square footage that's kind of 16 interchangeable with Gross Floor Area or/and square footage. 17 18 Commissioner Summa: But we wouldn't be counting footage that is exempted from being 19 counted. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Ms. French: So yeah in the Stanford University Hospital area, that medical office is not counted 2 into the cap. 3 4 Commissioner Summa: Oh, sorry I wasn't clear. I mean square feet that exists in a given 5 building but don't count against the FAR and I'm wondering if there was any idea how much of 6 that there might be that maybe should be included in the number? I have a couple questions 7 about the count. 8 9 Ms. French: I don't really have an answer for that. I'm not prepared for that question. 10 11 Commissioner Summa: Ok. 12 13 Ms. Lee: So actually, if I may? So, I think there are multiple items that we are evaluating for that 14 we monitor on an early basis. So, for... so I think the... for Program L-8 there was a specific way 15 we count versus for example the Annual Office Limit. So, in this case, we are compliant with the 16 limitation within Program L-8 and we are counting all the square footage that would be 17 applicable for this particular but we can certainly come back with more detail if you need it. 18 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Commissioner Summa: Ok I was just curious and then do you know where we are now because 2 I'm sure there's been some commercial development downtown since January of 2017 and we 3 didn't have that number in our report? 4 5 Ms. Lee: Actually, I do have that number. I've been having some technical problems. 6 7 Commissioner Summa: You can let me know later... you can let us know later when you find it. 8 And then this is a small thing but I notice that a lot of buildings downtown have converted 9 basement which was typically used as storage or warehouse to office and I'm... I have no idea 10 how many. I know it's come up before at Council and maybe even from me actually. Do we 11 have any idea if that's included in the square footage? The downtown non-commercial... non - 12 residential? 13 14 Ms. French: So, I believe this is the case if it had been counted towards the parking assessment 15 roles. In other words, some basement area has... have been used for offices etc. and if that area 16 was counted towards the parking assessment district as existing then it would have been 17 included in the existing floor area in town. 18 19 Commissioner Summa: Ok. Ok, thank you that's if for now. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: Commissioner [note- Vice -Chair] Monk. 2 3 Vice -Chair Monk: To follow up on Commissioner Summa's question regarding count, if 4 hypothetically Staff... I guess my first question... preliminary question is given the fact that 5 we've heard from a lot of concerned residents over the President Hotel. Has that space already 6 been accounted for in the Square Footage Cap? 7 8 Ms. Lee: It... no, it counts as... it... except for the ground floor. The ground floor is retail and the 9 above floors are residential so the residential units would not count against the cap. 10 11 Vice -Chair Monk: I see so if hypothetically there was a conversion, that then would trigger 12 application towards... with the cap? With the rules for governing cap, correct? 13 14 Ms. French: If we received an application for modification to that building that you're bringing 15 up, that hotel building, the President Hotel, then it would be looked at as far as that goes. You 16 know we have a maximum of 25,000 left I believe in the Downtown Cap so if they were to come 17 forward, grandfathers' facility aside, then there would be an issue with the amount of 18 remaining cap area. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Vice -Chair Monk: Ok and then on that same hypothetical, if we were to remove the cap then 2 we're looking at the City-wide cap and the 50,000 -square foot cap. Where would that building 3 fit? Would it still be precluded from a conversion based on the square footage or is it... 4 wouldn't it exceed the 50,000 -square foot limitation that we currently have in any event? 5 6 Ms. French: Yeah that's a... the 50,000 Annual Cap is related to office, not all commercial. The 7 Downtown Cap that is in this code that we're talking about tonight is related to call commercial, 8 not just office and R&D. Whereas the 50,000 Annual Cap Citywide or in those areas is related to 9 office R&D. 10 11 Ms. Lee: And also, the 1.7 million that is in the new Comp. Plan would also be office and R&D. 12 So, if the hotel was converted to an office R&D use that would be counted towards the annual 13 limit. Of course, if the previous Comp. Plan was still adopted... is still... was still effective then a 14 conversion from if say for example the hotel existed and it was already hotel. It could convert to 15 any non-residential use and it would not count against any cap. 16 17 Vice -Chair Monk: I'm sorry could you just repeat that? 18 19 Ms. Lee: So basically, under the old Comp. Plan the cap was for all non-residential uses. So, you 20 could go from commercial... you could go from retail to office and there's no cap. And there's 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 no problem with a cap versus the new policy which states that there's a cap on office R&D uses 2 only. So, if you have an existing retail use and you converted it to office then the Office Cap 3 would apply. 4 5 Vice -Chair Monk: Ok and in regards to that removal of the Policy L-8, was that recommended 6 by the Citizens Advisory Committee? 7 8 Ms. French: I believe it was. 9 10 Ms. Lee: Actually, so the way the Comp. Plan CAC process worked was that there were multiple 11 policy recommendations made by the CAC so that was one of the options. They didn't have a 12 strict recommendation by the whole CAC for Land Use policies... for... specifically for the 13 Growth Management Policies. 14 15 Vice -Chair Monk: Ok and then does our vote tonight on updating the code with this new 16 ordinance whether we vote year or no on it, how will that impact this... Hotel President? 17 18 Ms. French: The Hotel President is related to the existing code, not this code per say. The 19 Grandfathered Facilities Code that says if there's a grandfather's facility that is non -complying 20 in the downtown CD then that it can continue with its existing conforming use. Which it is a 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 conforming use, mixed -use, you know housing and retail but yeah so that's what that code is 2 about. That's the code that the City has alerted the new owners that this is in effect and 3 applicable to that property. 4 5 Vice -Chair Monk: So, you're referring to the code I think it's 18.18.120 which handles the 6 grandfathers which is not before us tonight. 7 8 Ms. French: Correct. 9 10 Vice -Chair Monk: And what is before us tonight whether we vote yes or no or modify it in any 11 way will have absolutely no barring or impact on existing residential use in the downtown? 12 13 Ms. French: It has an impact on if their conversion where allowable to one of the commercial 14 uses and we were going past 25,000 which is what's left then it would have an impact. There 15 may be other properties that are interested in adding square footage beyond 25,000 and so this 16 code section doesn't allow those projects to go beyond 25,000. You know office, retail, any 17 commercial. 18 19 Vice -Chair Monk: So, the new owner technically if this date on the books could bifurcate and 20 convert up to 25,000 K or whatever we have left on under this cap? 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Ms. French: If somebody wanted to come forward and it wasn't a grandfather's facility and they 3 wanted to convert then yes, they would be subject to a cap. 4 5 Vice -Chair Monk: This current cap that we're looking at tonight? 6 7 Ms. French: This current cap, yes. If the cap was removed then an existing facility that was not a 8 grandfathered facility could... you know as long as it's allowed by zoning could convert but then 9 that would go towards the 25,000. 10 11 Vice -Chair Monk: But this current property that we have the community out and discussing 12 tonight, although it's not related to this specifically, that property does not fall within that 13 zoning that you're referring too? 14 15 Mr. Albert Yang, Senior Deputy Attorney: So that property is a non -conforming facility and so 16 there is an entirely separate section of the code that applies and restricts its uses. 17 18 Vice -Chair Monk: Ok and I just want to confirm that any action we take tonight, I would like to 19 know what our actions tonight will impact or not impact to and to what extent with existing 20 properties downtown so that's where my questions are coming from. Thank you. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Chair Lauing: Do you... yeah, I want to get some comments from the public. I've got quite a few 3 cards. I'm sorry, Commissioner Alcheck. 4 5 Commissioner Alcheck: Ok I just want to ask you a quick question sort of following up on what 6 Commissioner [ ] Monk (interrupted) 7 8 We can't hear you. 9 10 11 12 Commissioner Alcheck: Don't worry, I'm getting there. Warming up. Let me follow up on what [note -female:] [off mic-speaking from the audience] [note- several audience members started talking at once 13 you just said to Commissioner [note- Vice -Chair] Monk. You have a recently enacted 14 Comprehensive Plan which replaces the Comprehensive Plan that supports Chapter 18.18.040. 15 And you have recent Council direction in the form of a directive that suggests enact a 50,000- 16 annual limit, that's changed a little bit over the course of the year and delete this downtown 17 specific cap. Are you suggesting that a parcel owner that came forward with a project that 18 exceeded 25,000 which is what we presumably have left would somehow be denied? And I ask 19 that question because when I put my land use attorney cap on it suggests that you'd have two 20 conflicting code directions and I would assume based on my experience that a court of law, if it 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. note- Vice -Chair 1 got litigated, would rely on the more recent code language and the even more recent Council 2 direction to eliminate the conflict. So, I'm asking if for example we recommended not changing 3 this code section or deleting it and Council agreed with that decision would this not be 4 indefensible? Wouldn't you be stuck because we've just essentially created an annual limit of 5 50,000 that contemplates double what a much older 30 -year old law allows? I see a problem 6 here and I need to understand how you think it at least from a legal perspective. 7 8 Ms. Yang: So that's something that we would look at if and when that situation arose but Staff's 9 recommendation tonight is that PTC recommends adoption of this ordinance which would 10 remove the cap and that potential conflict that you described. 11 12 Commissioner Alcheck: So, it's... ok. I guess what I'm... I can fully appreciate the legal 13 department's desire not to openly discuss a legal vulnerability. That's fine, I won't push you to 14 do that but I'm going to assume that your recommendation that we delete this is an effort to 15 eliminate a conflict that might be indefensible unless you tell me that it's not. I'm not... again I 16 can fully appreciate you're desire not to get into it because people are listening but I... it sounds 17 to me like the legal department's hands would be tied with this 25,000 remainder with all of the 18 action Council has taken and the new Comprehensive Plan. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Ms. Yang: Again, I think that's something that we would look at if and when it came up. I would 2 note that the 50,000 -square foot cap that you mention does apply not only to the downtown 3 but also to a few other areas in the City. So, in that sense, there is not a head-on conflict 4 (interrupted) 5 6 Commissioner Alcheck: Right. 7 8 Mr. Yang: Between the two policies. 9 10 Commissioner Alcheck: Right, ok, that's sort of the extent of my questions for Staff. 11 12 Chair Lauing: Commissioner Summa 13 14 Commissioner Summa: Thank you. Just one more and I thought maybe what Commissioner 15 [note -Vice -Chair] Monk was trying to get at and forgive me if this wasn't what you were trying 16 to get at. Are there other residential buildings existing in the CD district that if we eliminate the 17 cap will be vulnerable to be converting to commercial uses? I'm not... I can think of one maybe 18 but do we have any idea of how many of those there are? 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Ms. French: I mean there's a number of mixed -use buildings, larger buildings downtown that 2 contains residential that are in the CD Zone. So, I mean I can't think of any that use to be a hotel 3 I mean if that's what you're (interrupted) 4 5 Commissioner Summa: No, I'm not... that's not relevant to my question actually. It's just do we 6 have an idea... if we eliminate... take the... recommend eliminating the Downtown Cap L-8, 1 7 mean not... 18.18.0... whatever it is but if we do that are there... do we have any idea how many 8 other residential units or residential buildings there are in the CD Zone that could be converted 9 to a more lucrative purpose which is office commercial? 10 11 Ms. French: I mean for one thing the existing Zoning Code for CD has a limitation on the square 12 footage so for instance if you had a mixed -use building that had 1 to 1 FAR for... Floor Area 13 Ratio for commercial and somehow 2 to 1 for... existing for residential. Could they convert and 14 have it all be 3 to 1 -floor area for office? I mean I don't... that would be a tough one too 15 because that would be kind of non -conforming. A non -complying facility that you're changing 16 the use in so we might be in that same similar situation about conversion of use inside a 17 grandfathered building. I'm just trying to kind of throw out a hypothetical. This (interrupted) 18 19 Commissioner Summa: Ok so it sounds like... I mean that's not exactly what I was asking. I was 20 really trying to get some idea of potentially how much... I mean I think we'll all agree that office 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 is more lucrative for property owners than rental even though rental prices are getting so 2 expensive. So, I was just wondering if we had any idea of how many units we have downtown 3 that could potentially convert to office but if we don't have that number... ok, thank you. 4 5 Chair Lauing: Ok let's move to public comment. We have quite a lot of speakers, welcome you 6 all for participating in the process and I'd like to do 3 -minutes per speaker given the size of the 7 group. So, the first one up and this is speaking to the hearing on adoption of the ordinance 8 omitting Chapter 18.18 is Joe Hirsch and next is Suzanne I believe it's Kek. 9 10 Mr. Joe Hirsch: Thank you. I am Joseph Hirsch, a member of the Palo Altans for Sensible Zoning 11 Steering Committee which has authorized me to make the following statement on its behalf. 12 Now withstanding Council's prior actions, it may be the time given what is known now to give 13 Council a different recommendation on this item than what they might expect. City Staff and 14 some of you, maybe all of you, have spoken out about encouraging below moderate rate 15 housing throughout the City, particularly in the downtown area. It is our suggestion that 16 whatever action you take tonight you should be extremely clear about the effect your 17 recommendation will have on Hotel President Apartments and other similar properties in the 18 downtown area. You should be very clear if the action you recommend tonight will make it 19 easier to convert current rental apartments to either hotel rooms or luxury apartments. If you 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 do that the Palo Alto community will be fully advised as to what is happening. They deserve 2 that and you do deserve to be fully clear with the people you serve. 3 4 From our perspective, we urge you not to be apart of a process that will, in essence, evict the 5 tenants of the Hotel President Apartments. Some of whom have been living in downtown Palo 6 Alto for long periods of time. Accordingly, we suggest that you recommend retaining Section 7 18.18.040 and its non-residential development cap which is different than an office R&D cap. 8 Given the adverse consequences, we now know will result if the non-residential development is 9 unfortunately repealed. That is if repealed one barrier to the tenant's eviction will have been 10 removed. Is that what you want to recommend? We urge you to take a stand that will help 11 preserve below moderate rate housing in the downtown area by recommending retaining the 12 non-residential development cap. We need your leadership in view of changed circumstances. 13 Thank you for considering this request which as I noted before is being made on behalf of Palo 14 Altans for Sensible Zoning. Thank you. 15 16 Chair Lauing: Thanks very much. Suzanne Kek? Keek? I'm not getting it correct, you'll help me 17 out. 18 19 Ms. Suzanne Keen: Suzanne Keen. Good evening. I have never... I never knew about Hotel 20 President and the wonderful community that live there until all this came up. I am actually so 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 thrilled that we have a group like that and that we can continue the ordinance as it is and 2 support this kind of diversity with such vulnerable people that we need in our community. So, I 3 hope that you will keep the ordinance as is and protect vibrant communities as is. Especially 4 since we seem in Palo Alto think we need to build more below market rate housing and as 5 somebody who else spoke said, this is... if you build new it's nowhere going to be so much more 6 expensive than keeping something old that is working. Thank you. 7 8 Chair Lauing: Ok thank you. Robert Moss. 9 10 Mr. Robert Moss: Thank you, Commissioners. I agree with Joe Hirsch and I think it's essential 11 that we retain Section 18.18.040. As you know we have a jobs/housing imbalance in Palo Alto. 12 We should be doing everything that we can to preserve housing, especially lower -income 13 housing, and everything we can to prevent housing or housing type uses from being converted 14 to offices. We should [ elligible] a proposal for downtown right now would do. Now I have 15 happen to be very familiar with the President Hotel. When I first started working in Palo Alto in 16 1971 we couldn't sell our house in Rancho Costa Verde so for 2 -years I lived at the President 17 Hotel during the week and on Friday I'd fly home to LA and on Monday I'm back up to San 18 Francisco. Fortunately, we've been able to live in Palo Alto since 1973. Only 45 -years, I'm a 19 newbie here so I think if you retain 18.18.040 you are saying that you are retaining the kind of 20 low capacity development that we need downtown. We're supposed to be encouraging 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 downtown residential and discouraging increasing office use. If we allow the existing 2 elimination of 18.18.040 all that goes away. So, I think it's important for a number of that we 3 preserve that and we do everything we can to preserve housing. Especially small lower cost 4 housing downtown so I would urge you to act effectively tonight and don't allow the conversion 5 and don't allow removal of 18.18.040. 6 7 Chair Lauing: Thank you. Arthur Keller. 8 9 Mr. Arthur Keller: Thank you, Commissioners. So, there was an interesting blub in the Weekly, 10 which I'm going to paraphrase, of Mayor Kniss's quote. And she said it's hard to get City 11 employees because it doesn't have the same cache as it uses too. Well, it actually doesn't have 12 the same cache as it uses too and part of the reason for that is because prices are... of living in 13 Palo Alto are going up and up and up. And why is that? Because we keep on building more 14 office space and there's a push for office space and not enough push for housing. And as a 15 result of that, we are now... you are being asked to remove one of the caps which has been in 16 effect since 1989 and that cap is on an amount of non-commercial downtown. So, I'm 17 wondering if this the right time? Why is... why are we rushing to do this? The Council did 18 recommend removal from the Comp Plan of this policy but that's not the same as 19 recommending removal from... actually having a policy or program to remove it from the 20 Comp... from the ordinance. And so, we don't actually have a recommendation removing the 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 ordinance from the actual motion that was made by Council. And in fact, the motion talked 2 about monitoring development and parking demand. Where are we... wherein the Staff report 3 does it talk about monitoring development? Where in the Staff [note -report] does it talk about 4 parking demand? Nowhere and there for doing this instead of... it does not make sense when 5 we're not doing the things that even the motion talked about doing in concert. In addition, we 6 should be talking about traffic because we increasing are seeing going through downtown, 7 going on University Avenue, going on Willow Road, going on Middlefield Carmageddon. So, we 8 need to think about traffic impacts. People talk about traffic being bad. We should... I don't 9 recall the CAC specifically making this an option for the Council to consider. I think it was on the 10 Council's own motion. 11 12 And also, why are we rushing through this? Is this because we're removing one barrier for the 13 President Hotel Apartments? It seems to be suspicious that that might be a cause. We should 14 wait until new TDM evaluation is done and see how that's [unintelligible]. We should wait until 15 the Stanford GUP happens and we see how much growth is going to happen in there in terms of 16 traffic that's flows through downtown. And until the Stanford Medical Center construction is 17 complete and a November election in which there is a growth ordinance initiative on the 18 election. So why are we rushing to do this? You should say no, don't implement this change and 19 let it come back. Instead, implement changes of things we need like renter protection. Use your 20 time for that. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Chair Lauing: Thank you. Next up is Elaine Meyer. 3 4 Ms. Elaine Meyer: Good evening Chairman and members of the Commission. There's so much 5 confusion. Hardly anyone knows what's going on. Sure, this ordinance is supposed to clarify the 6 confusion? Yeah, right. Who benefits from the confusion? As specified in the January 2017 7 Wolbach motion focus should be on monitoring, development, and parking demand before 8 making any other changes. 9 10 When I first learned of the Council's intention to pre-empt the Citizens Intuitive, I was 11 disheartened. How could our City leadership be so deeply in the pocket of developers as to try 12 and silence us? Then I realized that this move... their move could backfire. It will make people 13 feel betrayed. I think the result could turn out to be that the Citizen's Intuitive will win by an 14 even larger margin than we anticipate. 15 16 Just a reminder on another subject, you probably know that the 2017 Citizen Survey reported 17 the percentages voting good or excellent on many issues. In fact, only 40 percent of the 18 population approved of the City's "Land Use Planning and Zoning". Only 51 percent believe Palo 19 Alto is generally acting in the best interest of the community and only 45 percent approved the 20 overall direction that Palo Alto is taking. I have a suggestion for the Planning Staff. The code is 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 barely readable. It needs to be clarified, simplified, removing redundancy, and made readable 2 by intelligent people. I think that is where the Staff's energy should go because who benefits 3 from the confusion? Maybe the developers of the President Hotel. Thank you. 4 5 Chair Lauing: Thanks very much. Ms. Roberta Ahlquist. Next up is Terry Holzmer. 6 7 Ms. Roberta Ahlquist: My name is Roberta Ahlquist and I'm speaking on behalf of the Women's 8 International Leagues for Peace and Freedom, low-income housing subcommittee. And half of 9 my speech was already said by Mr. Keller so thank you very much for putting that on the table. 10 There are two caps, one cap is a cap on Annual Office Cap Applicants to the downtown El 11 Camino and California Avenue. The other cap is an Absolute Cap on downtown commercial 12 development. I think those have been conflated in the discussion and they need to be 13 separated. We don't need... we need the caps on office development. It's clear if you would 14 want to do something for the Council it would be recommend renter protections, recommend 15 that no low-income housing, no rental housing be destroyed until there's replacement housing. 16 So, the people who are living here who are now getting increased... rent increases, therefore, 17 having to leave. There's a whole building with 11 different units on the corner of Webster and 18 Hamilton that is vacant. All those people had to leave town because there's a proposal for a 19 commercial office and condominium development. That's what's going to happen unless you 20 find a way to stop it. We don't need high -income condos. We need housing for the people who 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 work here. Those who travel the farthest who have kids who they have to put in some kind of 2 daycare in order to get to work. Those are the people who have the least amount of money for 3 the gas or the other kinds of transportation costs. So, find a way to not remove the caps on 4 office development but to provide low-income housing for our workers which makes the 5 community more or a community. 6 7 Chair Lauing: Mr. Holzmer. Yeah, we like... Council has advised me that it's not policy to 8 support with that kind of demonstration but we do thank you for your participation. Mr. 9 Holzmer followed by Rita Vrhel. 10 11 Mr. Terry Holzmer: Good evening Commissioners. I wish to highly recommend that you support 12 ordinance 18.18.040. I recommend that the PTC take no action tonight that would endanger or 13 change the current downtown cap. Changing or modifying this cap would seriously impact not 14 only the residents of the President Hotel but potential residents that live also in the downtown 15 area. I'm against anything that would severely impact the residents of this community that 16 would impact them in a bad way. The residents of the President Hotel disserve the same 17 treatment that any neighborhood in Palo Alto receives. We need to keep our existing housing 18 stock and prevent any attempt that would either eliminate that or change it. We need to do 19 more to protect the citizens and the residents of this City. Thank you. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: Thank you. Rita... is it Vrhel? 2 3 Ms. Rita Vrhel: Vrhel 4 5 Chair Lauing: Ok thanks. 6 7 Ms. Vrhel: I don't envy you tonight. I have to say that I'm completely confused and I am just 8 going to speak my mind. I think everyone has already spoken very well to the topic. I am really 9 concerned about the timing of this issue. Why now? Is that because of the votes initiative to roll 10 back office growth and development? Is it because of the sale of the President Hotel? Is it 11 because our City Manager and some City Council Members met with the new owner before 12 they bought the hotel? Is it because Jeff Levinsky dug through all the data and found that it was 13 a non -conforming use and therefore probably can't be converted without a legal fight? I wrote 14 a letter to the editor a while back that basically stated politics in this town stink. People are fed 15 up. You know you talk about the Comp Plan being changed. I was by a 5 to 4 vote and I would 16 remind you that 3 of the people that voted in the 5 to 4 majority were investigated for 17 campaign issues. One of the investigations is still going on a year and a half later. I wonder why? 18 I also would remind you that the CAC met for, oh god what was it, 18 months? Doria, you were 19 on it and there was actually no majority view. It seemed like it was Palo Alto forward and the 20 residents. It was very, very divided and if you remember the January 2016 Comp Plan meeting it 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 was a disaster with our then -Mayor Greg Scharff making motions and hogging the floor and 2 saying I won't accept that. So, when you talk about a 5-4 majority and directing you to do 3 something you really need to look at that majority and the way that majority came to the City 4 Council. And honestly, there are a lot of things that are not in the Comp Plan which remain in 5 the Municipal Code. I would urge you not to get involved in the tardy display of politics that the 6 City Council has shown us lately. People are fed up. I would table this and say go it on your own 7 and let the voters decide. Thank you. 8 9 Chair Lauing: Ok thank you. Next speaker is Herb Borock followed by Becky Sanders. 10 11 Mr. Herb Borock: Chair Lauing, Vice -Chair Monk and Commissioners I urge you to continue this 12 agenda item until the first meeting in January to give the Staff the time required to prepare a 13 project. Let allow an environmental document as required by the environmental impact... 14 California Environmental Quality Act. And also, as other speakers have said for the practical 15 reason that there's intuitive measure pending and you might as well see what the results of 16 that are to inform any decision that you make. You can't make a recommendation in the 17 absence of the required environmental document. A motion to continue takes precedence over 18 a motion to take action on the Staff recommendation and therefore it would replace such a 19 motion if it... ones before you but a motion on the recommendation could not replace the 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1. motion to continue. Which must be disposed of before there's an opportunity to discuss the 2 substance. 3 4 An Environmental Impact Report is a consistent set of policies... internally consistent set of 5 policies and programs and in this case is EIR for a Comprehensive Plan that replaces another 6 Comprehensive Plan of internally consistent policies and programs. Within a specific 7 Comprehensive Plan, you can replace programs and policies but individual programs and 8 policies from one EIR one Comp Plan did not replace those as another as stated in the Staff 9 report. 10 11 The existing cap that's being discussed before you is consistent with the cap that was adopted 12 Citywide; they both occur. There's nothing in the Comprehensive Plan that has a policy or 13 program to eliminate this downtown cap. Accordingly, since the EIR did not... does not contain 14 sufficient information to assess this proposal and all the effects of the specific action Staff is 15 required to do the Environmental Review conveyed in an initial study leading to a Negative 16 Declaration... a Mitigating Negative Declaration or another EIR. I'm surprised that this is coming 17 before you now because unlike a number of speakers who are speculating what development 18 will occur. I see nothing in the next 6 -months that's going to be impacted by this and certainly, 19 that wouldn't impact the continuation until January. Thank you. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: Thank you. Becky Sanders followed by Tucker Berckmann. 2 3 Ms. Becky Sanders: Good evening Commission Members. Thank you for your service. I was 4 triggered by a previous comment mentioning Casa Olga so I threw out my prepared statement 5 because it took me an entirely different direction. If we don't keep 18.80.040 [note- 18.18.040] 6 it will not only exacerbate an already direr housing situation. I think it will accelerate. We really 7 need to do everything in our power to prevent the erosion of any kind of housing and of course 8 to promote the building of more housing. In my neighborhood Ventura I walk all the time and in 9 the past 5 -years, I've seen a real change with more people living on the streets. The Olga... Casa 10 Olga a good friend of mine's mom lived there and she was evicted and she died within about 3- 11 weeks of relocating. I'm not saying that was the fault but eviction is very stressful, particularly 12 on elders, people living in a fixed income, I think it's cruel and I was really saddened to be 13 reminded of Carol's passing. 14 15 So ok in Ventura my daughter and I were hanging around and we drove... we found someone 16 dumpster diving and we drove them to the Opportunity Center. And his story was like many 17 other people's story. Had an apartment, lost it, lost his job, that was 2 -week ago. A woman... I 18 thought I recognized her was living behind the Shell station near my house and I talked to my 19 neighbor and they went and kind of looked at her and it turned out she use to rent in Ventura. 20 And nobody had seen her for a while and all of sudden she's living behind the Shell station and 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 she moves between three places. And then there's this family that lives in a car that I see on a 2 regular basis and they're doing a great job; of a father, a daughter and a mother living in the 3 sedan. I'm not quite sure what this has to do with this ordinance but somehow the drive for 4 money over people is turning our City into a very ugly place. And so, I want to encourage you all 5 from a moral standpoint and you have a legal standing to do so because it's not like we're 6 asking you to do anything illegal. Just go ahead and uphold this ordinance a little bit longer so 7 that we can continue toward to address this crisis in humanity in our City. Thank you. 8 9 Chair Lauing: Thank you. Tucker Berckmann followed by Annette Ross. 10 11 Mr. Tucker Berckmann: I wanted to respond briefly to the question from the Commission to the 12 Staff of whether this would actually affect the President Hotel and I believe the response from 13 Staff was no because this is a non -conforming building. What if in the meantime the building 14 classification changes and then it would be protected by the cap? That was not clear from the 15 earlier comments tonight and I think clarity should be gained on this point before we dismantle 16 18.18.040. And I think we need to find the exact count of the building, I think we need to find 17 out who the suitors are for the remaining space and also if there is pressure to remove this cap 18 it should be clearly stated what that reason is and who it is that needs a space. Otherwise, 19 there is no immediate need for removing the cap. Can't we live with 25,000 -square feet for 20 another 6 -months? Does this item need to be retained, perhaps changed, or merged into 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 something else? If... even... if so then there should be a period of consistency where the cap 2 remains in place until those changes are made. Thank you. 3 4 Ms. Annette Ross: (off mic) I'd like to give my time to Taylor [note -spelling] Brady. Is that ok? 5 6 Chair Lauing: Sure. It's just one of you. 7 8 Mr. Taylor [note -spelling] Brady: Good evening everyone. My name is Taylor [note -spelling] 9 Brady and I am a resident of College Terrace as I have been since 2014. And I would like to 10 speak in favor of maintaining the 18.18.040. One thing I'd like to point out as I begin is this 11 particularly rich but a double speaks in the Planning and Transportation Commission's 12 summary. The proposed repeal of... in Palo Alto Municipal Code Section 18.18.040 would bring 13 the Municipal Code into conformance with the recently adopted Comprehensive Plan and then, 14 this is the important bit, reflecting the policy change to focus on limiting office/R&D growth 15 Citywide. Of course, limiting office and R&D growth Citywide also involves focusing on critical 16 areas which it seems like the City is blindly assuming is not an important thing. The downtown 17 area where we're talking about development caps is one through which three major transit and 18 thoroughfares run. We're talking about University Avenue, we're talking about in an ancillary 19 capacity the Embarcadero and we're also talking about El Camino. So, we're talking about 20 major routes through which people come into the City which exacerbated the traffic problems 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 in the morning that exist because of the massive imbalance between office workers and people 2 who can afford to live here. And we're talking about removing those caps in order to allow the 3 development of more space that not only specifically evicts low income or low or moderate - 4 income residents who have a low impact lifestyle but also provides the precedent for allowing 5 future developments, non-residential developments, to go bananas all over the City. The 6 50,000 -square foot Annual Cap is a somewhat annual cap on office space in the three targeted 7 zones is somewhat misleading because it also goes along with the 1.7 million additional square 8 feet that are being allowed to go on in the rest of the City. I'd also like to focus on a couple of 9 key elisions by the members of the Staff representatives French and Lee enlighting the type of 10 square footage that has not been counted in the cap for 18.18.040. Talking about common 11 areas and parking and other such parts of all of these commercial developments that are of 12 course key to their operation as commercial or non-residential developments but are not being 13 included. Thus, giving us this magical 25,000 -square foot that are still left. What we need in this 14 City are beds, not desks as Annette encouraged me to say and I say that from a very personal 15 standpoint as a young person who's having a hell of a hard time staying here. 16 17 Chair Lauing: Thanks very much. The next speaker is Igbal Serang. 18 19 Mr. Igbal Serang: Evening... good evening Commissioners. I'm one of those newbies living at the 20 President for decades, close to 3. I remember when he had dark hair, I'm kind of losing it too. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 I'd like to support Arthur Keller's statement and others who have suggested you tabling this for 2 a future date. Perhaps give the opportunity for City Council to take the lead and provide unique 3 protections for the existing residential rental units at the President. Since all new developments 4 of larger sizes of residential or housing developments are practically modeled after the 5 President Hotel Apartments being dense, being small sizes, being hardly any parking, being in 6 the CD Zone and close to mass transit. It is time to consider that building a treasure for Palo 7 Alto. I understand you may not be able to make that type of statement for it to apply to an 8 existing structure but what a statement it would be. It may provide some teeth to City Council 9 to take the lead and create that possibility. Thank you very much. 10 11 Chair Lauing: Thank you. Margaret Heath. 12 13 Ms. Margaret Heath: [unintelligible] ok, can you hear me? Yes. Good evening Commissioners. 14 I'm here to support keeping the cap downtown. Others have spoken very eloquently this 15 evening about why you should do that and I agree and support all of their reasons for doing so. 16 In fact, this suddenly... we find this week this suddenly is on the agenda and it has all the 17 appearance of being a bit sneaky actually. As if it's possible for the benefit of one particular 18 business without having the chance to really explore why we should eliminate the cap? What 19 are all the unintended consequences might be or the intended ones? The President Hotel is a 20 perfect example of exactly the kind of housing that we need downtown. Council has been 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 advocating for this. I think many people have and I don't see any reason to remove it from our 2 rental units... our residential rental units and most especially because of its location. And 3 indeed, there may be other housing unit's downtown that would also be eliminated if the cap is 4 reduced. Thank you. 5 6 Chair Lauing: Thank you. Mr. Jeff Levinsky. 7 8 Mr. Jeff Levinsky: Good evening Commissioners. Look around at downtown and see what it's 9 become. We've piled in more buildings and more workers and more cars. We've created a 10 mess. Downtown residents here tonight are being evicted because we have no effective renter 11 protection and residential preservation laws. Others here can't park in front of their own 12 homes or get out of their own driveways at rush hour because so many commuters have taken 13 over our neighborhood streets. Those of us who live yet farther away won't even come to 14 downtown anymore because it is... it's traffic and parking are unbearable. Downtown is 15 supposed to be the heart of our community, it has become a disaster. And then we find in all 16 this darkness a small but gleaming ray of hope. A 3rd of a century ago a wise City Council 17 anticipated what would happen. They foresaw that excessive development might go awry and 18 they crafted a solution. A cap on downtown commercial growth that lets us step back and 19 address the traffic, parking, and other problems. That cap kicks in once 350,000 -square feet of 20 non-residential development are added downtown. The law says the City should count all new 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 non-residential square footage, the City hasn't. According to its own records, it has not counted 2 common areas, parking, storage spaces converted to offices and more. You don't have to look 3 far to find an example. For most of the 20th century, there was a 1 -story, 5,000 -square foot 4 building right across the street from us at 240 Hamilton. Radio Shack was there. A few years 5 ago, it was replaced by a new 4 -story building. You would think the new non-residential space 6 at that site would all count towards the 350,000 -square foot cap but the plans for that building 7 show it actually added 50 percent more new commercial space than the City shows on the 8 records for the cap. That's just one small building. Once you start correcting for others it 9 appears that we're already over the 350,000 -square foot cap. That means there should be a 1- 10 year moratorium, that moratorium will apply to buildings like the Hotel President and others 11 and prevent them from converting to hotel or offices. And let me say that the grandfathering 12 law, I am familiar with it is not enough because our City loses cases. They lost the case on 13 Edgewood Plaza. We hoped that they went back on appeal but we need all the protections that 14 we have in the law. We cannot give any up and keeping the cap also provides a unique 15 opportunity for you as Commissioners, the Council, and most importantly the public to 16 reimagine downtown so it can best serve its residents and our entire community. We can fix 17 Palo Alto. Please help by voting tonight to keep the cap in place and to protect our City. Thank 18 you. 19 20 Chair Lauing: Thank you. Ms. Karen Porter, I think. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Ms. Karen Porter: Good evening. I'll acknowledge I'm actually fairly new to this issue. I've been 3 focused on the jet noise fiasco over the last couple of years. I see some similarities. I don't see 4 our City leaders taking enough action to protect the residents and community members 5 interests. And I have to say I've been very impressed by all the speakers I've heard tonight who 6 are unanimous in their ask that the City either delay or reject this proposal. And I have to ask 7 myself where are the people, the community members, who are in favor of this proposal? Why 8 aren't they here? Why are they not showing their faces? And so, to me, it suggests that it's 9 really just the lobbyists for the developers who are behind this proposal. I really think we need 10 more transparency and more effective and considered decision making before a change like 11 this is implemented. Thank you. 12 13 Chair Lauing: Thank you. Lenore Cymes and then Mary Sylvester. 14 15 Ms. Lenore Cymes: Thank you very much for hearing me out and for you service of what you've 16 got to do up there. I hadn't planned on talking. I just want to share my experience. On Tuesday I 17 had to go from my house which is on Wildwood Lane, I turn on Channing and I turn to St. 18 Francis and I get in Embarcadero. It took me 25 -minutes to get to Home Depot. Think about 19 that. It usually takes me 2 -minutes, 3 -minutes, 5 if I get a couple of red lights. Coming back, I 20 had to do an errand on University Avenue so went over 101 and I couldn't figure what was 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 going on. From 101 to Middlefield Road heading east it was bumper to bumper the entire way. 2 It didn't stop. I heard horns for the first time in Palo Alto. Is the new ruling going to be what is a 3 second in New York for time for the car in front of you to honk the horn for the car behind to 4 hear it? It just didn't make sense and tonight I noticed coming down here, I come down on 5 Hamilton to come downtown. When I got past Greer there was hardly a parking spot. Maybe 6 somebody was having a big party, I don't know but I've never seen that many cars on Hamilton 7 to get all the way downtown. Thank you and I hope you think about the real -life experiences as 8 you make your decisions. 9 10 Chair Lauing: Thank you. Mary Sylvester and then Katja Priess. 11 12 Ms. Mary Sylvester: Good evening Commissioner and City Staff. I'm here to echo much of 13 what's been said this evening. I urge the maintenance of 18.18.040, the cap, not it's repeal as 14 has been recommended by City Staff. We need more time for review before this is even 15 seriously considered. As has been said tonight why now? This Council chambers and the media 16 we've heard for over a week is confused. Why is this going on? Can we please have some 17 transparency why this discussion is happening at this point in the middle of summer when 18 many residents are out of town? 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 On a personal level, I am particularly concerned about the President Hotel residences. This is a 2 warm, vibrant community as we've seen not only tonight but before the Council before it took 3 its break. I've had friends and still do in the President Apartments. One of whom is a teacher in 4 our local school district. These are people assisting our community. 5 6 Just to walk down memory lane, I remember Cosa Olga and the single room occupancy hotel 7 that use to be next to it on Hamilton and Emerson Streets. These two facilities had over 100 8 residents; low income, seniors and the disabled. Where is the replacement? There is none. And 9 as to more commercial growth you've heard from all the speakers tonight. We don't need that 10 at this time. We need to rectify the job/housing imbalance. Arthur Keller well illustrated this 11 year the number of major issues this community has to grapple with. This should not be one 12 we're considering at this time. Thank you. 13 , 14 Chair Lauing: Thank you very much and Katja Priess. 15 16 Ms. Katja Priess: Yeah, my name is Katja Priess and I spoke earlier so I lived in the Hotel 17 President again 20 -years. And I didn't really prepare much to say at this point but I wanted to 18 thank really everybody who spoke right now in favor of keeping the cap. A lot of our community 19 right now said that there is hope and what really touched my heart is that I don't know a lot of 20 the people who spoke tonight but this is the reason why we would like to stay in Palo Alto. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Because there is still this spirit of community that people do speak up for each other and 2 support each other. If we cannot stay in the President, we have to get out of Palo Alto. We 3 would lose this spirit of community and it would break the heart of a lot of us who live in the 4 President. That's all I wanted to say, thank you. 5 6 Chair Lauing: Thanks very much. So that concludes the public speakers and the... 7 8 Mr. Bill Ross: [unintelligible — spoke from the audience off mic] 9 10 Chair Lauing: Right, we only got one card. 11 12 Mr. Ross: 13 14 Chair Lauing: Ok that's fine. Why don't you just... why don't you just fill that out again? We're 15 not trying to keep you away. [unintelligible — spoke from the audience off mic] 16 17 [note- many people from the audience started speaking at once] 18 19 Commissioner Alcheck: [off mic] Do you want me to fill that out for you? 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Mr. Ross: [unintelligible — spoke from the audience off mic] Commission, Chair, Commissioners 3 respectfully, I have comments in two areas barring on this agenda item. One is General Plan 4 consistency and the other is CEQA compliance. Pages 3 to 4... first of all what's before you is a 5 change to the Zoning Ordinance. It's not just a code change. This is clearly a project under 6 CEQA. It's also subject to General Plan consistency analysis. The analysis that you have before 7 you is on Pages 3 to 4 and focuses principally and exclusively on the Land Use Element. That's 8 not the standard. The standard is that articulated in the 2003 and 2016 General Plan guidelines 9 that confirmed judiciously. What is that? That you look at the action and you say does the 10 action further without hindering all elements of a General Plan? That analysis isn't here. 11 Respectfully if you look at the Housing Element of the new Comp Plan there are several policies 12 that bare on the preservation of existing housing. Among others, there's an inventory of sites 13 that should be in that analyzed in such an analysis that would bear on the CD district. That's 14 absent. On the CEQA issue, I would incorporate the testimony of all the tenants that were 15 present here tonight. Why does that bare on not just relying on the Comprehensive 16 Plan/General Plan? Much like Herb Borock, I would say there's a need for another assessment, 17 an initial study. Why? There are changed circumstances under CEQA guideline Section 15.626 if 18 I remember correctly, under which this project would be carried out. What is it? Among other 19 things, tenants are going to be displaced. There's an economic impact. The normal rule under 20 CEQA is that economic impacts are not assessed but that's qualified if there's going to be an 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 effect on the environment. We know there are going to be displaced. There's already an 2 agreement for relocation assistance by AJ Capital. Let's look at AJ Capital and on this, I have 3 personal knowledge. What are they doing? They have 11 existing facilities in university towns, 9 4 planned, all of them convert to exclusive Airbnbs. Is that what we want? We want to have that 5 displacing of diverse housing opportunities that exist right now contrary to the new General 6 Plan policies? I would respectfully suggest and this would be the part that's based on personal 7 knowledge, let's go look at another one of those existing facilities. One exists in Iowa City, Iowa. 8 It's 9 -stories, it's 237 units, the prices... and the cost of living in Iowa City is about 1/3rd of what 9 it is here, is for units for $160 to $360 a night. It's for people like Gene Wilder. Allow me to 10 finish if you will please? My point is that's what we're putting in in the President Hotel and 11 we're displacing tenants? Much like Mr. Borock, I think there's an incomplete CEQA analysis 12 and incomplete General Plan analysis. On those bases alone, you should differ until you get that 13 type of analysis supported by substantial evidence before you. Thank you. 14 15 Chair Lauing: Thank you. Alex Smaliy. 16 17 Ms. Alex Smaliy: [unintelligible -off mic] 18 19 Chair Lauing: Ok. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Mr. Smaliy: Hi, I spoke early and I wanted to follow on from what the previous speaker said. I 2 just wanted to speak plainly about what is actually happening at the President right now. Which 3 is that yes, there was a comment earlier that AJ Capital have not applied to change the use of 4 the building. But we have to look at what they are which is they're a hotel developer. They 5 develop hotels. They are not... it is difficult to imagine a scenario in which they maintain the use 6 of the building as residential. They will apply for an exemption. They may have to struggle with 7 the City to get it but if we limit the protections on the building to just it's grandfather statues it 8 again may not be enough. Because they will try to get like...this is what they bought the building 9 for, they paid untold millions of dollars to convert the building to a hotel, they're even quite 10 clear about the recent New York Times article with a wonderful title of the Education of a 11 Brotelia [note — couldn't find the spelling]. So, its... just because they haven't applied to change 12 the buildings use far and away doesn't imply that they will... that they will not do it. They're 13 already... they're forcing the tenants to empty the building so the [unintelligible] is already 14 being destroyed. And as a landlord, they are within their own rights to do that. We are tenants, 15 we are not owners. Sure, we may be gone but maybe the building will remain and others will 16 have the opportunity to live downtown in this walkable, transit -accessible, dense, wonderful 17 downtown community. Great but it is extremely dubious that this is what they are planning to 18 do. 19 20 Chair Lauing: Ok the last speaker and we're going to close comments here is Michelle Kraus. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Ms. Michelle Kraus: Thank you so much, Commissioners. I just wanted to thank the community 3 as my colleague and friend Katja did. They've stood up for us and not only the Planning Staff 4 have raised their voices but here we are and we're asking you to join us. Again, what 5 [unintelligible] in my professional hat is there's confusion over the metrics. Doria, you raised it. 6 Is it FAR? Is it square footage? What's counted? What isn't counted? Let's go back, take a step 7 back, and let's take time to figure this out and I urge you to uphold the cap of 18.18.040. We 8 need you. Thank you. 9 10 Chair Lauing: Ok thank you. That concludes the testimony part of the hearing and now we'll 11 bring it back to the Commission of Item Number 2. So, we just opened the floor to comments 12 and questions from Commissioners. Just light up your lights. Commissioner Alcheck. 13 14 Commissioner Alcheck: Ok, I have a question but I'm not sure you'll be able to speak to maybe 15 but just so I make sure not to misspeak later. Would it be your understanding that (interrupted) 16 17 18 19 Commissioner Alcheck: Do you think it's correct to suggest that the ballot measure coming 20 before the City in November, I think that's qualified, regarding amending the cap that was [note — many people speaking from the audience at once] 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 adopted in the Comprehensive Plan is not impacted by this adjustment? What I'm trying to say 2 is there's been a suggestion that this would somehow preempt the citizens ability to speak but 3 it's my understanding that the ballot measure isn't amending the Comp Plans 1.7 million City - 4 wide cap, not another or I should say the more current 1.7 million cap not this sort of pre - 5 existing cap. Is that accurate? 6 7 Mr. Yang: I think what you're asking is, is there a relationship between this cap and the ballot 8 measure or the City-wide cap of 1.7 or half of that amount whatever it may be. And from our 9 perspective no, there's... those are unrelated caps. 10 11 Commissioner Alcheck: Ok that's sort of what I understood the ballot measure to say. Ok, so 12 I'm going to... are you setting time limits or are we... ok, so I'm going to... I'm just going to 13 address one thing about process real quick. I'm glad Elaine Miller that you joined us tonight. I 14 was hoping I'd have an opportunity to meet you. I want you to know that when I saw your 15 Next -Door post on Monday at 4 because I get the roundup, I was a little disappointed. Because 16 you wrote and I'll quote it because I think it's worth... that we all work setting the tone here, 17 which is you said that the development cabal on the PTC is concerned about the Citizens 18 Initiative to restrain office growth will pass. And so, the Planning Commission has scheduled a 19 discussion to raise the Downtown Cap to preempt the election and the expression of the 20 citizen's voice. I think it's safe to assume that when you say development cabal you are 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 referring to some nefarious group of which you believe I am a member. And if that's the case 1 2 just... 1 want you to know that none of the Commissioners before, all of which are volunteers, 3 have any oversight or influence on agendizing an item like the one before you... before us 4 tonight. In fact, I had only begun and had not yet finished reviewing this item when I saw your 5 post and so I just hope that everybody knows that there's no effort... the cabal members are... 6 did not ask Staff to bring this forward. And you know you may not realize it but on our 7 Commission's website my contact information is provided and I really wish you'd called me 8 before suggesting that somehow there was nefarious intent. 9 10 [note -female:] [unintelligible -speaking from the audience] a conversation [unintelligible]. 11 12 Commissioner Alcheck: No because I want you to know we received almost (interrupted) 13 14 ] 15 16 Commissioner Alcheck: Excuse me. 17 18 Chair Lauing: Right. [note -female:] [unintelligible— speaking from the audience 19 20 Commissioner Alcheck: I just... I want to address the fact that we (interrupted) 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 [note -many people speaking from the audience at once off mic] 3 4 Chair Lauing: Let's just make it brief Mike [note -Commissioner Alcheck]. 5 6 Commissioner Alcheck: Yeah, I just wanted you to realize we received hundreds and hundreds 7 of email (interrupted) 8 9 [note -female:] [unintelligible — speaking from the audience off mic] 10 11 Chair Lauing: Ok so (interrupted) 12 13 Commissioner Alcheck: I just want you to realize we received hundreds and hundreds of emails 14 and there was a general fear (interrupted) 15 16 [note -female:] [off mic] Just don't point out one person. 17 18 Commissioner Alcheck: It's... I'm not I (interrupted) 19 20 Chair Lauing: Ok Michael [note -Commissioner Alcheck], Commissioner (interrupted) 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 3 4 Chair Lauing: Commissioner (interrupted) 5 6 7 8 Chair Lauing: Ladies and gentlemen, Commissioner Alcheck currently has the chair. 9 [note- many people from the audience speaking at once off mic]. [note -many people speaking from the audience at once off mic] 10 [note -male:] (off mic) How does this move the (interrupted) 11 12 Chair Lauing: Ok, ladies and gentlemen (interrupted) 13 14 Commissioner Alcheck: Please let me finish. 15 16 Chair Lauing: We'II move to recess if we can't get order. So, Commissioner Alcheck currently 17 has the floor and I would urge brevity because I think you've made a point. 18 19 Commissioner Alcheck: Let me... if I sound like I took it personally, I'm not. It's just that I'm... 20 we... I'm here to engage with you and I make my self -available. I think we all do and what we 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 saw in the last 48 -hours is a tremendous sense of distrust in us. The suggestion that we have 2 somehow attempted to further the President Hotel's process. 3 4 [note -unknown speaker:] (off mic) Yeah but this is not (interrupted) 5 6 Chair Lauing: Please. 7 8 [note -unknown speaker:] (off mic) relating to the issue [unintelligible]. 9 10 Chair Lauing: Yeah, could (interrupted) 11 12 Commissioner Alcheck: We have (interrupted) 13 14 [note -many people speaking from the audience at once off mic] 15 16 Chair Lauing: Mike, I think you've made that point and I don't really want to carry on with it too 17 much longer. Did you have any other comments on the merits here? 18 19 Commissioner Alcheck: Yeah, I'll (interrupted) 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 3 Commissioner Alcheck: Ok. 4 [note -many people speaking from the audience at once off mic 5 [note -male] (off mic) it's not on the issue. 6 7 Commissioner Alcheck: Alright, I think we've heard (interrupted) 8 9 Chair Lauing: Are we going to (interrupted) 10 11 Commissioner Alcheck: I will continue with my comments. 12 13 Chair Lauing: Let's say... let's stay on the agenda and let's urge brevity. 14 15 Commissioner Alcheck: I'll say... I'll try to conclude with this. The... this issue has been litigated 16 sort of at nauseum this specific issue in our community. I did not agree with everything that 17 came to pass with the adoption of our Comprehensive Plan but I did and I continue to respect 18 the process by which it came about. This... tonight this concept it is a policy discussion and 19 we've already participated in it and Council acted upon it. And with that said though, there 20 remains a legal ambiguity here. I attempted to also understand how this came to us and it 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 seems to me that there's an effort maybe during the summer when our Legal Department or 2 our Planning Department tries to understand what potential issues may come that they are 3 trying to address that issue which is, I think, admirable. That said there's remains a legal 4 ambiguity and we need political clarity. Clarity that really only our Council can provide which is 5 why I would suggest that tonight we come together. We show the community that we're 6 equally unsure of what the Council's direction was and support a motion that recommends that 7 the City Council make the determination on this code section without direction from the 8 Commission. We've reviewed the growth strategies, in summary, we've reviewed the growth 9 strategies and opined on them. And there's a conflict in our code between this section and the 10 Comp Plan's newer City-wide cap and whatever compromise our Council came to, to enact that 11 cap along with the 50,000 -annual limit. And the City Council could immediately resolve this 12 confusion and add clarity and help us understand exactly what was the strategy that they had 13 intended. So again, I want to reiterate that I'm here, I'm available and I would support that we 14 come together as a group to demonstrate that we want to resist sort of the pollicization of this 15 Commission and allow our Council to just provide the clarity that they may be unfortunately 16 didn't provide. 17 18 Chair Lauing: Ok. Other speakers? Commissioner Waldfogel. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Commissioner Waldfogel: Right. I want to thank all the public speakers for coming out tonight. 1 2 know that it's not... can you hear me? 3 4 Commissioner Summa: No, I can't even hear you. 5 6 [note -male:] Get close. 7 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Commissioner Waldfogel: Let me see if I can pull this microphone a little bit closer. Sorry about 2 that, can you hear me now? Ok great. Yeah so, I want to thank you all for coming out tonight. 3 I'm sure it's not exactly what you wanted to be doing on whatever tonight is, July 29th [note - 4 July 25th] 5 6 MOTION #1 7 8 I'm... in the interest of moving this forward I'd actually like to propose a motion and if I get a 9 second on the motion then I would like to speak to the motion. So, the motion that I want to 10 propose is to move the Staff recommendation. 11 12 Chair Lauing: Move the Staff recommendation as published in the Staff report basically. Is there 13 a second to that? No second. 14 15 Commissioner Alcheck: Can I ask a question real quick before it (interrupted) 16 17 Chair Lauing: Well we really need a second before we can discuss it. 18 19 SECOND 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Commissioner Alcheck: If I need to... I'll second it just to simply ask him a question. 2 3 Chair Lauing: Well yeah, I think we... ok because then we can have a... then we can begin 4 discussion. So, Commissioner Waldfogel moved and it's seconded by Commissioner Alcheck. 5 6 Commissioner Alcheck: I would like to understand the rationale. 7 8 Chair Lauing: Which is why he's going to speak now. 9 10 Commissioner Alcheck: That would be great. 11 12 Chair Lauing: Commissioner? 13 14 Commissioner Waldfogel: Great, we have the motion and a second so it's on the floor. So, I'd 15 like to say I will vote against this motion and my reasons are the following. The City Council and 16 the Comp Plan have set multiple contradictory goals in place that just don't coordinate. I mean 17 right now housing is Priority One, reducing commercial intrusions into the neighbors is I think 18 Priority Two through RPP and other tools, retail protection is Priority Three. I mean I may not be 19 getting the exact priorities right but these are stated priorities and more office is not even a 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 stated priority. So, we're solving a non -problem today and it's something that's just wildly 2 contradicted in the Comp Plan. 3 4 We also see from tonight's speakers on various issues that it's really hard to make any progress 5 on housing. Developers will continue to develop commercial office uses as long as commercial 6 and office uses are possible and they are more profitable than housing. I mean that's what's 7 been happening for the last 15 -years and it will continue to happen. And so, until we 8 understand that we really shouldn't change anything. And we're in the middle of a Housing 9 Work Plan and we should really look at this in the context of that Housing Work Plan. Finally, 10 there is a Growth Ordinance on the ballot in November and taking this on right now just looks 11 like it's undermining a democratic process. We just shouldn't do that so if we retain the cap 12 tonight and if we hit the limit in the next year or two, which were likely to do, we have time to 13 develop an alternative. After that Growth Ordinance is voted up and down and after the 14 Housing Work Plan is completed so we have plenty of time to do this. We don't have to do this 15 tonight but my ask is whichever way we vote on this, whether we vote this up or down, let's get 16 it to the Council quickly. I mean here I agree with my colleague Commissioner Alcheck. I think 17 we should make a recommendation, I think we should get at Council, and Council should say 18 whether they like this or not and resolve the ambiguity. I don't think we should let this hang out 19 until next year. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 I also have a question for our esteemed counsel which is this... and if this is off topic just stop 2 me but just what tools do we have from PTC to make a quick recommendation to Council on 3 renter protection? I mean are there... is there anything we can do around renter protection, 4 evictions, rent increases? I mean we've heard loud and clear that these are issues and just what 5 can we do? I mean do we set up an Ad Hoc? Do we... what's our process? 6 7 Ms. Yang: You know you and your fellow Commissioners are free to communicate with the 8 Council anyway you want too. I mean (interrupted) 9 10 Commissioner Waldfogel: But as a body how do we communicate an intent if we had an 11 intent? 12 13 Mr. Yang: I... that's something that I can think about but (interrupted) 14 15 Chair Lauing: I think we just have to agendize it as an issue and work with Staff to get it on the 16 agenda. 17 18 Mr. Yang: This is something that we can talk about at another time in the meeting. 19 20 Chair Lauing: Right. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 SECOND WITHDRAWN FROM THE MOTION #1 3 4 Commissioner Alcheck: I'll just withdraw my second since I don't really support the motion. 5 6 Chair Lauing: I'm sorry where you done Commissioner Alcheck [note- Commissioner 7 Waldfogel]? So that's on the... it's on the floor for discussion. 8 9 Commissioner Alcheck: I wanted to understand his rationale so I withdraw the second because 10 I don't wish to support that motion but I do wish to (interrupted) 11 12 Chair Lauing: Is that an option? 13 14 Mr. Yang: Yes, of course. 15 16 SECOND 17 18 Chair Lauing: Ok. I'm happy to second it to continue the discussion if we want because there's 19 a motion on the table, right? 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Mr. Yang: Only if it's seconded. 2 3 Chair Lauing: Right but I think it's a worthwhile discussion so I'm happy to second it. 4 5 Vice -Chair Monk: I don't think it's a good practice to second motions for the... we can still have 6 a discussion without 7 8 Chair Lauing: Ok, sorry, did you want to go ahead? 9 10 Vice -Chair Monk: I just think it's odd to make a motion that you have no intention of advancing 11 on and having it pass so why would we discuss it further? 12 13 Commissioner Waldfogel: [unintelligible -off mic] take a vote. 14 15 Vice -Chair Monk: You... oh so you might change your vote on your motion because you stated 16 earlier that you would not be supporting your own motion which I thought was (interrupted) 17 18 We can't hear you. 19 [unintelligible] [note -female:] (off mic) 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: The motion on the... the motion that was made was to accept the Staff 2 recommendation which generates the discussion. So that's basically where we are and he 3 stated why he wouldn't vote for it. I'm interested in getting more conversation so I don't care 4 procedurally how it is. Did you have a comment Commissioner [note -Vice -Chair] Monk? Your 5 light went on. 6 7 Vice -Chair Monk: Yeah, I do have a few comments. First, I'd like to acknowledge some of the 8 members of Council that are here tonight. Our Vice -Mayor is here, Council Wolbach is here if 9 there are others I'm missing thank you for coming tonight, and showing your interest. And also 10 thank you to everyone who sent in letters and everyone who's come tonight. We definitely 11 appreciate all of the input. 12 13 There was an overwhelming support to address the housing crisis and push to preserve housing 14 at all income levels and I heard that unanimously stated by everyone present tonight. When we 15 return on August 29th we will be discussing a framework for Housing Ordinance specific to the 16 downtown area. And I'd like to extend an invitation to everyone here and everyone listening at 17 home to please come, please speak, send letters, walk the walk. We definitely want to hear 18 from you on that issue. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 As far as the timing of this particular ordinance I find it unusual in that Staff typically goes over 2 agendize items with the Commission. And also, with... specifically with the Chair and myself and 3 this was on that had not been previously brought up to our attention. So, if there was some 4 reason that this came forward other than the code cleanup, which is what we're telling... being 5 told is the reason, I would like to know it. And until then in the absence of that my 6 understanding of our objective tonight is to look at the Staff report because Staff has identified 7 a need to update the code so that it complies with the new adopted Comp Plan and Council 8 direction from January 30th, 2017. So, in that regard, it's quite clear to me what our objective is 9 tonight and why this is being brought to us. And if there is any further confusion on what it is 10 that is before the PTC I would refer to Packet Page 12 which is the actual ordinance and gives 11 background on the prior Comp Plan where the Downtown Cap was put in place. It also 12 explained what was to happen when we got used... got close to approaching the maximum 13 under that and about 4 -years ago we were getting close and would have triggered the 14 moratorium. And so that's why it went back to Council and the Phase One of the Downtown 15 Cap Study was put in motion. And based on the findings of that study based on the new Comp 16 Plan Council made the recommendation that we go with a City-wide cap which incorporated 17 the Downtown Cap. And they also enacted the 50,00 -square foot cap so we have two other 18 caps that were to replace and update the direction that we needed to go in. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 We've heard from residents that retaining this cap will somehow have a bearing on preserving 2 residential buildings in the downtown area. However, when we asked Staff about that and look 3 at the code there was anything that I'm seeing that supports that. So, I don't know if there's 4 something indeed that I'm missing but my understanding is that whether or not we take a yes 5 decision on the Staff proposal or we take a no -decision. Either outcome from my understanding 6 has no barring on any residential buildings or conversions in the downtown area. And if I'm 7 mistaken in that conclusion I would like any of my colleagues to correct me or anyone in the 8 audience I invite you to correct me. I did reach out to certain members of the community 9 because there were posts online and on social platforms that gave rise to my questioning as to 10 what was before us tonight. And when I attempted my follow-up I did not get any additional 11 clarification from anyone actually linking what was before us tonight with any potential action 12 that can or cannot occur in regards to the residential units in downtown. That this is an 13 ordinance that relates to the commercial development and it has no barring on residential. 14 15 So, I haven't taken a position on this particular motion just yet but I would say that based on 16 what I'm currently understanding, the motion is to advance this to Council so that it will be 17 back in Council's court for them to reevaluate and decide what to do in terms of this new 18 ordinance. So, I guess I'm leaning towards having it go back to Council in some format or 19 another because we're an advisory Board in any event. And they're going to end up making 20 their decision irrespective of what we decided tonight and it may or may not comport. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Arthur Keller, I'd like to acknowledge that you are here at the podium and if you wanted to 2 address us if the Chair would be ok with that? 3 4 Chair Lauing: The hearings closed but did you have a question for him? 5 6 Vice -Chair Monk: Well, I'm curious Chair, I'm wondering if he wanted to answer my question 7 because I did put a question out to the community where I generally would like to know what 8 exactly is the nexus between what's before us tonight and the Hotel President. And if someone 9 can clarify the nexus for me and... then I would like an answer to it. So, if the Chair is... if that's 10 (interrupted) 11 12 Chair Lauing: Counsel? 13 14 Mr. Yang: It's in the Chair's discretion. 15 16 Chair Lauing: Commission, allow the speaker? 17 18 Commissioner Summa: (off mic) That's fine with me. 19 20 Chair Lauing: Just say yes or no. We're just taking a Commission vote. One, two, three. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Commissioner Alcheck: [unintelligible — off mic] 3 4 Chair Lauing: Yeah, I mean we can't do this to 25 speakers so if this is specifically answering one 5 of your questions then we'll allow it but it has to be constrained. Go ahead, Mr. Keller. 6 7 Mr. Keller: My understanding is that Commissioners can ask specific members of... questions of 8 members of the public and I'm offering an answer to her question. 9 10 Chair Lauing: Right so go ahead. 11 12 Mr. Keller: So, it's my understanding that multiple ordinances may apply to [unintelligible] 13 situations. So, with respect to the President Hotel Apartments, in the situation that there... the 14 square footage of that would be converted from residential to a non-residential use, mainly 15 hotel exceeds 25,000 or that incorporated with other developments. Such as the one on 16 Cowper and University where to that cap then this conversion could not happen as an 17 additional reason. Now it does turn out that the City Manager before the sale went through did 18 say that he thought it could happen by right but it's not clear exactly at this public... it's 19 probably going to be litigation that happens. And if there's litigation on this particular sale 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 because of representations made by the City Manager then having additional ordinances that 2 apply will [unintelligible] the City's case. 3 4 Chair Lauing: Ok did you have any other questions Commissioner [note -Vice -Chair] Monk? 5 6 Ms. Vrhel: I would also like to speak because Commissioner [note -Vice -Chair] Monk 7 (interrupted) 8 9 Chair Lauing: Wait, this is what I don't want to get into. 10 11 Ms. Vrhel: I think there's only one... it's just me. She asked the residents (interrupted) 12 13 Chair Lauing: I think... did you have your question answered, Commissioner [note -Vice-Chair] 14 Monk? 15 16 Vice -Chair Monk: No. I'd be happy to hear what Ms. Vrhel has to say but if you need to put that 17 to a vote to the Commission. 18 19 Chair Lauing: Ok. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Ms. Vrhel: I think what I heard today was that the two City Staff representatives from the 2 Building Department really didn't have a clear answer as to many of your Commissioner 3 questions. And I think you have an attorney here and I think actually what would be very good 4 would be for Ms. Monk's questions to be given over to the legal counsel... the City's legal 5 counsel and for them to provide you a rock solid, honest question or answer to her questions. 1 6 think the rest are conjecture. And having worked with the City Staff before on planning and 7 particularly Ms. French, I have personal experience that all... that leading information out of an 8 answer creates confusion. Thank you. 9 10 Chair Lauing: Alright, let's move on. Did you have any other questions or comments at this 11 point? 12 13 Vice -Chair Monk: Thank you for the input. What I do believe is that additional changes to the 14 code would need to take effect in order for there to be any sort of action on that particular... on 15 the President Hotel. So, this singular action I don't think would have any barring at all and that 16 in order for something to happen additional changes would need to occur. There would need to 17 be another change in the code or zoning or something in order for there to be something to 18 change... to really impact that unit. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 I do have one question for Staff and that has to do with the... and I know this isn't... Staff has 2 represented that the item that the public is speaking to is not... that there is not a nexus and 3 there's not a relationship to what's before tonight. So, I hope that I'm not out of turn and still 4 referencing it but I also just wanted to confirm that... I just lost my train of thought. I apologize 5 but I guess my main concern is that some of the confusion that I believe that the residents are 6 expressing tonight has to do with what we're tasked to do and what might be available to the 7 residents of this other property. And I don't know that there's been sufficient nexus between... 8 connecting the... what's before us tonight with the Hotel President hasn't been shown in my 9 viewpoint so far. Thanks. 10 11 Chair Lauing: Ok, Commissioner Summa. 12 13 Commissioner Summa: Well, thank you, everyone, for your patience this evening. So, I would 14 like to start out by saying that one of the things that has been emphasized the Council vote on 15 this about 18 -months ago. In the last year, the Mayor and the Council have been unanimous in 16 one thing and that is that we need more housing and we need housing downtown. Removing 17 the commercial cap from the downtown will disincentive housing and will create more offices 18 that will contribute to the existing problems that the... our former Council Member's in 1986 19 were smart enough to see so that's the first thing. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 I think the Council would like to have us give them the recommendation to reconsider this 2 because I don't think since in the last year that is what they have expressed. And I think they 3 rely on us to give them good information. Furthermore, we have had a superabundance of 4 concern from every point of view; the moral; the legal; the sensible. We know we have an 5 existing problem with traffic and parking downtown. We have made a commitment to the 6 residents of Downtown North and South to annually reduce the number of commuter parkers 7 in their streets every year and we cannot do that if we continue to add office. We can add office 8 in other parts of downtown where... and other parts of the City but downtown is full up. I think 9 we should assume given the difficulties that we seem to encounter counting the square footage 10 I think we should assume we've hit the cap. I didn't hear a direct answer but Staff referred to 11 25K left. That... you know... so let's assume we've hit the cap. This cap is not a hard cap, it is a 12 cap that says huh, we're here. This is where we thought the trouble would really start to get 13 really bad so we want to take a year off, we'll take a moratorium and I think that is a really good 14 thing for us to discuss how this affects the other housing issues that are coming before us. I 15 think we should approach this from a holistic policy issue. That is how we will wind up with a 16 solution and a conclusion that serves all the residents in this City as best it can and no longer 17 continues to burdened the downtown with too much office space that it cannot support. So, I 18 would... if I thought there was support from my colleagues I would make a motion that we 19 recommend that we believe we have reached the cap and the moratorium should immediately 20 be put into place. In the absence of that kind of support from my colleagues, I would simply like 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 to make the recommendation that we do not recommend at this time that the Council abandon 2 18.18.040. Do I have a second? 3 4 Vice -Chair Monk: I'll second it. 5 6 Chair Lauing: Wait so procedurally do we not have the motion already on the table from 7 Commissioner (interrupted) 8 9 Vice -Chair Monk: That's a substitute motion, correct? 10 11 Mr. Yang: Yeah so that would be a substitute motion that Commissioner Summa has made. 12 13 Chair Lauing: That's what I wanted to clarify. 14 15 Vice -Chair Monk: And I would second that. 16 17 Chair Lauing: So please restate the substitute motion. 18 19 Commissioner Alcheck: (off mic) Which one are you seconding? 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: She's seconding Commissioner Summa's. 2 3 Commissioner Summa: (off mic) I can't restate it. [unintelligible] 4 5 Commissioner Alcheck: She said two motions. She suggested (interrupted) 6 7 Chair Lauing: It was your ladder motion I believe Commissioner Summa? 8 9 SUBSTITUTE MOTION 10 11 Commissioner Summa: I don't... if I have support for enacting the law that exists right now on 12 the books of the City that would result in a very sensible 1 -year moratorium on office space. So, 13 we can all take a step back and look how we can achieve the goals we want together. I would 14 make that motion. 15 16 Chair Lauing: Then you need to make it as opposed to ask the question but if you'd like to 17 (interrupted) 18 19 Commissioner Summa: Ok I'II make that motion. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: do that one, that's ok otherwise we'll go to the second. 2 3 Commissioner Summa: That's a law that is in place and we have every reason I believe to follow 4 it. 5 6 Chair Lauing: Ok so now (interrupted) 7 8 Commissioner Summa: Do I have a second? 9 10 Chair Lauing: Is there a second to that? 11 12 Commissioner Waldfogel: [unintelligible — off mic] 13 14 Chair Lauing: Well first let's see if there's a second. It doesn't sound like there's a second so that 15 motion is not going to forward. 16 17 SUBSTITUTE MOTION DIES DUE TO THE LACK OF A SECOND 18 19 FRIENDLY AMENDMENT 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Commissioner Summa: Ok and I'm sorry I made the double motion. I'm not very good at making 2 motions and I make it extemporaneously so whatever I said in the second motion and that is 3 basically that we recommend that the Council not pursue abandoning the Downtown Cap at 4 this time for all the reasons I stated before. 5 6 Chair Lauing: Ok is there a second to that? Was that Commissioner [note- Vice -Chair] Monk's 7 second? I'm not trying to put you on the spot just (interrupted) 8 9 Vice -Chair Monk: I just want to clarify from the maker. Are you just recommending that we 10 don't advice this to Council or are you actually also making some affirmative direction? 11 12 Commissioner Summa: No, I'm... Staff's recommendation was that we recommend that Council 13 go ahead and pursue abandoning 18.18.040. I am saying for all the reason that I stated and the 14 many people in this room who spoke so well that we do the opposite. And we tell them that we 15 think that they should keep 18.18.040 in place and not remove it from the Municipal Code. 16 17 Chair Lauing: Ok so the motion is to retain 18.18.040 so is there a second to that? That's fine if 18 you don't I just didn't want to preempt you from seconding it. We just need a second so we can 19 discuss it so. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Commissioner Waldfogel: [unintelligible — off mic] 2 3 Chair Lauing: So procedurally... what I was going to say is there's no second but procedurally 4 don't see that that's much different. It's just one of those substitute motions that get to the 5 same place depending on which way you vote on it because the first one says we should go 6 ahead and do it and then it's going to be either approved or not. And you're saying we should 7 tell them not to do, it's going to be approved or not so I think we're in the same place. 8 9 Vice -Chair Monk: I guess I have a question for counsel then. Is it the same effect to make a 10 recommendation to keep an ordinance on the books that we know is in conflict with other 11 existing ordinances versus just saying let's not advance this to Council? 12 13 Mr. Yang: So, this... let me try to help maybe structure this. Right now, there's a motion on the 14 table which was the Staff recommendation that the Council adopts the ordinance. One way to 15 distinguish Commissioner Summa's substitute motion is to frame it as a recommendation that 16 the Council rejects the proposed ordinance. And those would be two separate affirmative 17 actions which the Commission could vote on. 18 19 Chair Lauing: Which I think is essentially the same thing as what you're saying, right 20 Commissioner Summa? 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Vice -Chair Monk: No, she's (interrupted) 3 4 Chair Lauing: Because I don't want him to put words in your mouth so I want you to itemize 5 your own motion. 6 7 Commissioner Summa: No, he's correct. To... they are in my mind diametrically opposed. One 8 says please do this and get rid of 18.18.040 from our Municipal Code and the other says please 9 do this, keep 18.18.040 in our Municipal Code. 10 11 Chair Lauing: So are... I just want... are you going to accept his language that you want to reject 12 the proposal of Staff? 13 14 Commissioner Summa: Sure, I appreciate that Staff will probably word it better than 1 so that's 15 fine as long as it's clear what the difference is. 16 17 Chair Lauing: Ok so we need a second for that which again to my mind sort of going the same 18 place which the same kind of motion. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Vice -Chair Monk: I'd prefer to vote on the first motion and then just start fresh with a new 2 motion then go through the substitute motion so I will be seconding it. 3 4 Chair Lauing: So, there's no second to that motion at this point. 5 6 Commissioner Waldfogel: (off mic) I'll accept that as a friendly amendment. I mean we're just 7 trying to get to the same place. The question is just what's the most expeditious process to get 8 to the same place? 9 10 Chair Lauing: Ok, that's very accommodating. That's very accommodating. So, let him just 11 rephrase the motion then as a friendly amendment. Right, did you want to try that one Alex... 12 Albert or are we ok? 13 14 Mr. Yang: So, I guess the question is does the seconder of the main motion accept that friendly 15 as well? 16 17 Chair Lauing: Yeah, no I was just trying to get... we're onto... we're basically onto Commissioner 18 Summa's language now. 19 20 Mr. Yang: Ok so the motion as amended (interrupted) 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: And my second still stands. 2 3 Mr. Yang: The motion as amended is a motion to recommend that the City Council reject Staff's 4 proposed ordinance. 5 6 Chair Lauing: Right. Ok and now Commissioner Alcheck has a comment? 7 8 Commissioner Alcheck: Yeah just... so just for clarity, I think even though they're opposites and 9 the failure of one is the same as the success of the other. You need an affirmative motion to 10 have... we cannot conclude this item without an affirmative... without a motion passing. 11 Whether that's a motion to continue, a motion to recommend not approving (interrupted) 12 13 Chair Lauing: Right so that's in place now. 14 15 Commissioner Alcheck: That's why the failure of Asher's [note -Commissioner Waldfogel] 16 original motion wouldn't be the same as the success of her substitute. Now (interrupted) 17 18 Chair Lauing: Ok so we got that. 19 20 Commissioner Alcheck: Ok I just wanted clarity there. Ok now (interrupted) 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Chair Lauing: So, let (interrupted) 3 4 Commissioner Alcheck: Now I'd like to make the comment that I'm waiting to make. 5 6 Chair Lauing: Sorry because I haven't spoken yet to the motion so. 7 8 Commissioner Alcheck: Yeah so, I'm going to respond to something. I... there's a little more 9 nuance here regarding housing growth that I'd like to acknowledge. Our code... and please 10 correct me if I'm wrong. It's my impression that our current Municipal Code disallows 11 development of solely residential in our downtown. That without a mixed component of 12 commercial you actually can't add any residential to our downtown. So, this is a little 13 problematic because I am firmly in support of the strategy to add additional housing. I don't 14 share the belief that commercial office space is more lucrative simply because it's commercial. I 15 think our code has created incentives that allow commercial projects to be of great intensity 16 and thus reap greater rewards. If our residential projects could have that same advantages 17 think we would see a lot of more residential projects. One of those disadvantages is that our 18 residential projects have to incorporate some mixed -use or they can't come forward. Am I right 19 about that? 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Ms. French: In the CD Zone that's correct. Some of the downtowns like RT, the SOFA area is 2 different. 3 4 Commissioner Alcheck: Some of that is inclusive but most of it. So, I mention that only because 5 if for example, we had considered a moratorium on any of those uses then we would also be 6 considered as our law is currently written a moratorium on residential because our residential 7 is handicapped by this requirement. I am satisfied if this Commission decides to further the 8 recommendation that's currently on the dais simply because again, I think this is a decision... a 9 discussion that we've had and we've expressed points of view on it. We really need the Council 10 to tell us what is it exactly you intended or what is it that you now intend? I think regardless of 11 what the Council decides on this when the citizens vote in November if the citizens of this great 12 community decide to half the City-wide cap then that is the purgative of our citizenry. And that 13 effort shouldn't be preempted. I don't think telling us providing clarity here would do that but 14 will say this if the... and I'll just... I'll direct these comments to Council. If you elect not to make 15 the change and retain the cap we really need Staff to address the issue of the requirement that 16 our residential include a component of commercial because without addressing that we are 17 allowing the code to essentially restrict residential development. And that is a huge concern of 18 mine. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 I want to just say one additional thing. I don't feel that we have really enough information to 2 address the impact of this element on the President Hotel situation. We haven't been informed 3 about it and it's not... it's... I know probably far less about it than most of you who are living 4 there. 5 6 Chair Lauing: Yeah, it's not even a project, that's correct. 7 8 Commissioner Alcheck: Right and so I think it's important to acknowledge that even if... it 9 wouldn't... it probably would not be appropriate for us at this juncture to suggest some specific 10 legal policy with respect to that site. Because there is a process by which we have to be 11 informed and hear community input before making such a recommendation. So, I just want you 12 to know that I believe we share some of that concern and we feel a little unprepared to provide 13 some feedback in that regard simply because of a lack of insight and prep. 14 15 Chair Lauing: Ok. 16 17 Commissioner Alcheck: But I... again I welcome... I would welcome our Chair inviting that 18 discussion so that's what I have to say about the motion on the floor. 19 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 Chair Lauing: So, I'd like to speak to the motion and actually my own second. First of all, as been 2 stated by a couple of my colleagues we just got this agenda item without any prior discussion 3 ever. Either up here or independently so we're reacting from the time that we got our Packets 4 delivered on Friday night to try to prep for this. Highly respect and appreciate all the input from 5 the public. 6 7 The whole point to me as I began studying this issue from the get go up to this second is timing 8 of any sort of discussion or action on the accruing cap one way or the other. A number of 9 speakers have asked what... why now? What's the rush? There isn't any. We have a common 10 pre -meeting with Assistant Director Lait and the Commissioner [note- Chair?] and Vice - 11 Commissioner [Note -Vice -Chair] and others we discussed it at length yesterday. And my 12 questions were around why are we discussing this now? Why is it even in front of us? Why 13 don't we continue this until there are some other things that are more important that we've 14 studied and taken action on called the Housing Work Plan? Which is substantial stuff that is 15 likely going to result in the need for code changes to give incentives to development of housing 16 and relaxation of standards which I think there is close to universal support on this dais for. 17 18 So, we talked about continuances and how urgent was it and unfortunately the Assistant 19 Director isn't here but I mean we agree that a continuance would be acceptable. And also, that 20 it is not particularly time -sensitive relative to existing projects or frankly anything else. So, one 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 way or the other I come in tonight saying that I think we do not want to take official action on 2 the exact ordinance language that was put in front of us. A lot has changed in 18 -months since 3 January 30th, 2017 when Council had these discussions. Not the least of which is again the acute 4 situation around housing and the commitment of Council to more housing of all types and 5 particularly the commitment of Council and the community to BRM and affordable housing. We 6 have got to take action on that, that takes the highest priority, that's what we need to work on 7 the rest of the year, [and] that needs to be done before we look at this thing in front of us 8 tonight in a vacuum because we don't know what the impacts are. And we don't even have 9 things in the Staff report on transportation impacts, TDMs, etc. etc. etc. There's just nothing 10 there to look at so for those two reasons the whole issue here is the sequence on addressing 11 this as is, is just wrong. We have to calculate the impacts and we have to sort out what we 12 really want to do to change the housing build rate in the City and all areas. So that has to be 13 done first and therefore this thing should not be approved, particularly since there's no time 14 sensitivity. 15 16 So, I think that we're just looking at the right technique to send that message back to the 17 Council and in support of the community. I think that the motion that's on the floor does that 18 fine because we can say we don't want to approve that now and these are the reasons why so 19 I'd be happy to support that motion. I think that we're getting, regardless of the technique, 20 close to the consensus that we're not ready to move on that now. We all want to prioritize 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 housing and Council ought to take a second look at that in the context of what we get done 2 through the end of this year before taking a look at that cap issue in a vacuum. So, I'd be happy 3 to support the motion as it is. Other comments on that? Commissioner Summa. 4 5 Commissioner Summa: Just a specific comment but I... Staff can maybe verify that this is true. 6 believe by using TDRs... we can use TDRs for residential so you could get buildings that have 7 quite a bit residential. Is that accurate? I think it's in the code. 8 9 Ms. French: We can get back to you further on that but we don't think there's a prohibition in 10 the code to use TDRs for residential but it just hasn't been done. It's always been (interrupted) 11 12 Commissioner Summa: Because off... yeah because most property owners are going to go for 13 commercial space but we can. 14 15 Ms. French: As too Commissioner Alcheck's point, you wouldn't be able to use it and create a 16 holey residential project in the CD Zone downtown. 17 18 Commissioner Summa: No but you have to put... in lots of CD you have to have ground floor 19 retail anyway which is protected Citywide. So, I think there's more potential than maybe my 20 colleague was thinking about at the moment. 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 2 Chair Lauing: Ok if there are no other comments let's take a vote on the motion and to restate 3 it. 4 5 Commissioner Summa: (off mic) Are we voting on mine? 6 7 Chair Lauing: We're voting on the friendly amendment that you gave to Commissioner 8 Waldfogel which is to... if you want to give us the exact wording. 9 10 Mr. Yang: The recommendation that the Council rejects Staff's proposed ordinance. 11 12 Chair Lauing: Yeah at this time or something like that. 13 14 Commissioner Summa: Can you say that again? I can't hear you. 15 16 Mr. Yang: Sorry, it's a Planning Commission recommendation that the Council rejects Staff's 17 proposed ordinance. 18 19 Commissioner Summa: Thank you. 20 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. 1 VOTE 2 3 Chair Lauing: Ok all in favor of that motion signify by raising your hand; four. Opposed? Zero. Is 4 there an abstention? One. 4-0-1. Do you want to speak to your abstention? 5 6 MOTION PASSED 4(Lauing, Summa, Monk, Waldfogel)-0-1(Alcheck)-2(Gardias and Riggs absent) 7 8 Commissioner Alcheck: Yeah, I'll just quickly restate that I think this is... I don't know that the 9 Commissioner needs to provide input here outside of the tremendous amount of input we gave 10 during the Comp Plan process. And I think Council can provide us the clarity without our 11 direction so as to give us our greatest chance to avoid the politicization of our work during this 12 very tentious election year. 13 14 Chair Lauing: Ok, thank you. That concludes Item Number 2 and I'd like to call a recess here at 15 8:35 for about 10 -minutes. 16 17 18 19 20 21 22 [The Commission took a short break] 3. The Planning and Transportation Commission Will Review and may Amend the PTC By -Laws and Procedural Rules. (Continued from June 27, 2018) 1. Spokespersons that are representing a group of five or more people who are identified as present at the meeting at the time of the spokesperson's presentation will be allowed up to fifteen (15) minutes at the discretion of the Chair, provided that the non -speaking members agree not to speak individually. 2. The Chair may limit Oral Communications to 30 minutes for all combined speakers. 3. The Chair may reduce the allowed time to speak to three minutes to accommodate a larger number of speakers. CITY OF PALO ALTO TO: HONORABLE CITY COUNCIL FROM: JONATHAN LAIT, INTERIM DIRECTOR PLANNING AND COMMUNITY ENVIRONMENT DATE: DECEMBER 3, 2018 SUBJECT: AGENDA ITEM NUMBER 9 PUBLIC HEARING. Adoption of an Ordinance Amending Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Repeal Section 18.18.040 Regarding a Nonresidential Square Footage Cap in the CD Downtown Commercial Zoning District to Implement and Conform to the Updated Comprehensive Plan; Section 18.18.040 Implemented Policy L-8 of the Prior 1998 Comprehensive Plan, Which was Removed as Part of the Adoption of the Comprehensive Plan Update. California Environmental Quality Act (CEQA), This Ordinance is Within the Scope of the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720 Due to the continuation of the Housing Work Plan Ordinance from November 26, staff recommends continuing this item to a date uncertain. Staff will re -notice this ordinance in accordance with the municipal code requirements. J' an Lait I erim Director s es Keene City Manager 1 of 1 CITY OF City of Palo Alto (ID # 9860) PALO ALTO City Council Staff Report Report Type: Action Items Meeting Date: 12/3/2018 Summary Title: Change of Land Use in Non -Complying Facilities (Downtown) Title: PUBLIC HEARING: Adoption of an Ordinance Amending Section 18.18.120 (Grandfathered Uses and Facilities) of Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Adjust Regulations Relating to Noncomplying Facilities. California Environmental Equality Act ( CEQA), This Ordinance is Within the Scope of the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720; Alternatively, the Ordinance is Exempt From Environmental Review Under CEQA Guidelines Section 15061(b)(3) From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that Council: 1. Find the attached ordinance within the scope of the Comprehensive Plan Environmental Impact Report (EIR) certified and adopted on November 13, 2017 by Council Resolution No. 9720; and, 2. Adopt the attached ordinance; and, 3. Direct staff to initiate a text amendment to amend Palo Alto Municipal Code (PAMC) Section 18.18.120 in accordance with the procedures set forth in PAMC Chapter 18.80 with review and recommendation by the Planning and Transportation Commission and in accordance with the Council's action on the attached ordinance. Executive Summary The recommendation in this report temporarily restores Municipal Code regulations that were changed during a 2016 zoning code update. The 2016 amendment restricts property owners who wish to remodel, improve, or replace buildings that exceed today's development standards City of Palo Alto Page 1 from changing one land use to another. For instance, a building that exceeds allowed floor area cannot remodel to convert a restaurant space into a retail use. To preserve the public health, safety, and welfare, while a permanent change is considered by the Planning and Transportation Commission (PTC), staff recommends adoption of the proposed ordinance. Background Palo Alto Municipal Code Chapter 18.18 regulates what a Downtown property owner can do with a building that no longer complies with today's zoning rules; it also regulates land uses that are no longer permitted. Last summer, staff learned of a change to the subject zoning code chapter. The change may have been unintentional and occurred in January 2016 when the Council adopted a wide ranging set of minor or clarifying zoning amendments. Among those amendments, staff highlighted a change to PAMC Section 18.18.120 (Grandfathered Uses and Facilities) that clarifies when minor modifications to the building envelope of a non -complying building are permitted for the purpose of improving the structure's pedestrian -oriented features. The 2016 amendments also included a change requiring non -complying buildings to retain the same use of the property when remodeling, improving, or replacing the building. Before the amendment, land uses in non -complying buildings, or facilities, could be replaced with other land uses provided they were permitted or conditionally permitted in the zone and met other applicable requirements. This latter amendment was included in the 2016 ordinance as presented to both the PTC and the City Council, and it was duly enacted pursuant to the Palo Alto Municipal Code. The change was not, however, highlighted in the ordinance, and the accompanying staff reports included no reference or policy analysis related to the change. Based on the foregoing, it is possible the regulation prohibiting a change of use in non -complying buildings was an administrative error made when drafting the ordinance. Discussion Palo Alto's zoning code, like most in California and elsewhere, have regulations that control what an owner can do when they have either a land use or building that does not conform to current standards. Typically, non -complying uses are permitted to continue in a building but may not be altered, changed or expanded in a manner that increases the degree of non- compliance. Similarly, non -complying buildings can be altered or remodeled, and in some instances in Palo Alto, rebuilt, provided, again, there is no increase to the degree of non- compliance with any development standard. It is unusual, however, for local zoning ordinances to restrict changes to otherwise lawfully permitted land use in non -complying buildings. City of Palo Alto Page 2 Staff became aware of the code change after new owners of the President Hotel announced their interest in converting its residential units to a hotel. This property has received a considerable amount of attention, but there are lesser known examples that are impacted by this code provision. The Cheesecake Factory recently closed its doors on University Avenue and the property owner is seeking to convert this space into a retail use but is unable to renovate for a retail use under the current code. A restaurant/wine bar that is located in a building slightly over the maximum allowed floor area is seeking to occupy a former retail space but is unable to make necessary structural changes to the building for this change of use. The former North Face building on Alma, after siting vacant for an extended period of time, proposed to remodel to change the retail space to a personal service use and has been prevented from doing so. In the case of the President Hotel, the applicant has asserted that application of the current code would run afoul of the Ellis Act, among other state laws. The proposed ordinance seeks to revert the Downtown non -complying facilities regulations back to the pre -2016 standard. This involves a modest adjustment striking the operable clause in PAMC Section 18.18.120 (b)(2). Because there are a number of property owners that are affected by the potentially inadvertent code change, staff is pursuing a temporary resolution that is consistent with the code that allows the city to address an immediate need to preserve the public health, safety, and welfare, while a permanent change is considered by the Planning and Transportation Commission pursuant to PAMC Section 18.80.090. Policy Implications Although the current code may have some legitimate basis in policy (e.g. it favors replacement of non -conforming buildings with conforming development) it has had a number of negative impacts. If the Council decides not to amend the code, the City can expect additional downtown property owners objecting to the standard and frustrated by an inability to remodel to fill tenant spaces based on market demand and subject to the City's other regulatory requirements. Some property owners may be reluctant to redevelop property, including housing projects, based on this policy. There are approxmiately 250 Downtown properties and a number of them are non -complying with respect to maximum building height or maximum floor area. These buildings would be prevented from remodeling, improving, or replacing their facilities to change from existing land uses to other permitted or conditionally permitted land uses, including a change from non -retail to retail, which other City policies support. Resource Impact There are no significant resource or fiscal impacts associated with the recommendation in this report. Timeline As directed by the City Council, staff will present an ordinance to the PTC codifying the City of Palo Alto Page 3 proposed changes and return to Council in the first half of next year. Environmental Review This proposed ordinance is within the scope of the Comprehensive Plan Environmental Impact Report (EIR) certified and adopted on November 13, 2017 by Council Resolution No. 9720. Alternatively, the Ordinance is exempt from environmental review under CEQA Guidelines Section 15061(b)(3). Attachments: Attachment A: Ordinance Amending PAMC Section 18.18.120 (CD -C - Grandfathered Uses and Facilities) (PDF) City of Palo Alto Page 4 ** NOT YETADOPTED ** DRAFT Ordinance No. Ordinance of the Council of the City of Palo Alto Temporarily Amending Section 18.18.120 (Grandfathered Uses and Facilities) of Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Adjust Regulations Relatingto Noncomplying Facilities. The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. Findings and declarations. The City Council finds and declares as follows: A. Section 18.18.120 of the Palo Alto Municipal Code governs permissible noncomplying uses and facilities in the Downtown Commercial zone district. B. In 2016, the provisions of Section 18.18.120 governing permitted uses in noncomplying facilities seekingto remodel, improve, or replace site improvements were updated to: 1) allow minor modifications to building envelope through Architectural Review; and 2) require that such facilities maintain continual use and occupancyfor the same use. C. The requirement that noncomplyingfacilitiesmaintain continual use and occupancyfor the same use has resulted in potentially unintended consequences, includingthe inabilityfor noncomplyingfacilities to change from eating and drinkingservicesto retail uses. D. A temporary reversion of this requirement to the previously existing language is necessary to preserve the public health, safety, and welfare, while a permanent change is considered bythe Planning and Transportation Commission pursuant to Palo Alto Municipal Code Section 18.80.090. SECTION 2. Section 18.18.120 (Grandfathered Uses and Facilities) of Chapter 18.18 (Downtown Commercial (CD) District) of Title 18 (Zoning) is hereby amended to read as follows: 18.18.120 Grandfathered Uses and Facilities (a) Grandfathered Uses (1) The following uses and facilities may remain as grandfathered uses, and shall not require a conditional use permit or be subject to the provisions of Chapter 18.70: (A) Any use which was being conducted on August 28, 1986; or (B) A use not being conducted on August 28, 1986, if the use was temporarily discontinued due to a vacancy of 6 months or less before August 28, 1986; or jb SL/Amending ORD 18.18 (DC) District 1 July 2018 (C) Any office use existing on April 16, 1990 on a property zoned CD and GF combining, which also existed as a lawful conforming use prior to August 28, 1986, notwithstanding any intervening conforming use. (2) The grandfathered uses in subsection (1) shall be permitted to remodel, improve, or replace site improvements on the same site, for continual use and occupancy by the same use, provided such remodeling, improvement, or replacement complies with all of the following: (A) shall not result in increased floor area; (B) shall not relocate below grade floor area to above grade portions ofthe building; (C) shall not result in an increase of the height, length, building envelope, buildingfootprint or any other increase in the size of the improvement. For purposes of this section, "building envelope" shall mean the three dimensional shape and size occupied by an existing building. It is not the maximum, buildable potential ofthe site; (D) shall not increase the degree of noncompliance, except pursuantto the exceptions to floor area ratio regulations set forth in Section 18.18.070; or (E) in the case of medical, professional, general business or administrative office uses ofa size exceeding5,000 square feet in the CD -S or CD -N district that are deemed grandfathered pursuant to subsection (1), such remodeling, improvement, or replacement shall not result in increased floor area devoted to such office uses. (F) The Director may approve minor changes to the building's footprint, height, length, and the building envelope through Architectural Review of minor aesthetic architectural improvements and to improve pedestrian -orientation provided there is no increase to the degree of any non-complyingfeature. (3) If a grandfathered use deemed existing pursuantto subsection (1) ceases and thereafter remains discontinued for 12 consecutive months, it shall be considered abandoned and may be replaced only by a conforming use. (4) A use deemed grandfathered pursuant to subsection (1) which is changed to or replaced by a conforming use shall not be reestablished, and any portion ofa site or any portion ofa building, the use of which changes from a grandfathered use toa conforming use, shall not thereafter be used except to accommodate a conforming use. (b) Grandfathered Facilities (1) Any noncomplyingfacilityexistingon August 28, 1986 and which, when built, was a complyingfacility, may remain as a grandfathered facility and shall not be subject to the provisions of Chapter 18.70. (2) The grandfathered facilities in subsection (1) shall be permitted to remodel, improve, or replace site improvements on the same site for continual use and occupancy, by the same use, provided such remodeling, improvement, or replacement complies with all of the following: (A) shall not result in increased floor area; (B) shall not relocate below grade floor area to above grade portions ofthe building; jb SL/Amending ORD 18.18 (DC) District 2 Ju1y2018 (C) shall not result in an increase of the height, length, building envelope, buildingfootprint, or any other increase in the size of the improvement; (D) shall not increase the degree of noncompliance, except pursuanttothe exceptions to floor area ratio regulations set forth in Section 18.18.070; (E) The Director may approve minor changes to the building's footprint, height, length, and the building envelope through Architectural Review of minor aesthetic architectural improvements and to improve pedestrian -orientation provided there is no increase to the degree of any non-complyingfeature. SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions ofthis Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional. SECTION 4. The Council finds that the Ordinance is within the scope of and in furtherance of the Comprehensive Plan 2030 which was evaluated in that certain Final Environmental Impact Report ("Final EIR") certified and for which findings were adopted by Council Resolution Nos. 9720 and 9721 on November 13, 2017, all in accordance with the California Environmental Quality Act ("CEQA"). Pursuant to Section 15168 of the State CEQA Guidelines, the City has determined that no new effects would occur from and no new mitigation measures would be required for the adoption of this Ordinance. The Council further and alternativelyfinds,that even if this Ordinance were not within the scope of the Comprehensive Plan 2030, it would be exempt from environmental review under Section 15061(b)(3) of the State CEQA Guidelines. SECTION 5. This Ordinance shall be effective on the thirty-first date after the date of its adoption and shall expire upon adoption of replacement legislation bythe City Council or on December 31, 2019, whichever occurs first. Upon expiration of this Ordinance, the City Clerk shall direct the City's codifier to update the Palo Alto Municipal Code as appropriate. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: NOT PARTICIPATING: jb SL/Amending ORD 18.18 (DC) District 3 Ju1y2018 ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Deputy City Attorney City Manager Director of Planning& Community Environment jb SL/Amending ORD 18.18 (DC) District 4 Ju1y2018 CITY OF PALO ALTO TO: HONORABLE CITY COUNCIL FROM: JONATHAN LAIT, INTERIM DIRECTOR PLANNING AND COMMUNITY ENVIRONMENT DATE: DECEMBER 3, 2018 10 SUBJECT: AGENDA ITEM NUMBER 10 PUBLIC HEARING: Adoption of an Ordinance Amending Section 18.18.120 (Grandfathered Uses and Facilities) of Chapter 18.18 (Downtown Commercial District) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) to Adjust Regulations Relating to Noncomplying Facilities. California Environmental Equality Act ( CEQA), This Ordinance is Within the Scope of the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720; Alternatively, the Ordinance is Exempt From Environmental Review Under CEQA Guidelines Section 15061(b)(3) Due to the continuation of the Housing Work Plan Ordinance from November 26, staff recommends continuing this item to December 10, 2018. onattYan Lait terim Director Js Keene City Manager 1 of 1 CITY of City of Palo Alto (ID # 9803) PALO ALT© City Council Staff Report Report Type: Consent Calendar Meeting Date: 12/3/2018 Summary Title: 429 University Avenue: Appeal of Director's Decision on Condition Compliance Title: PUBLIC HEARING / QUASI-JUDICIAL: 429 University Avenue [18PLN- 00240]: Appeal of the Planning and Community Environment Director's Denial of a Minor Architectural Review Consistent With Condition of Approval Number 3 From Record of Land Use Action Number 2017-02, for a Previously Approved Mixed -use Building (14PLN-00222), for the Proposed Exterior Building Materials, Colors, and Craftsmanship. Environmental Assessment: Use of Mitigated Negative Declaration Prepared for 14PLN- 00222. Zoning District: CD-C(G)(P) (Downtown Commercial With Ground Floor and Pedestrian Shopping Overlay) From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends the City Council: 1. Deny the appeal by Kipling Post, LP of the Director's partial denial of Application No. 18PLN-00240 and approve the corresponding Record of Land Use Action. 2. Amend the City Council's prior approval, memorialized in Record of Land Use Action No. 2017-02, by extending the term of that approval to December 31, 2019. Executive Summary This report provides the background information concerning prior City Council review of the 429 University Avenue project, subsequent Architectural Review Board review for condition compliance, and the current appeal of the Planning and Community Environment Director's decision. Kipling Post, LP timely appealed the Director's Decision partially approving and partially denying an application for minor architectural review. Other elements of the project, City of Palo Alto Page 1 including the square footage and overall massing of the project, were conditionally approved by the City Council in 2017 and are beyond the scope of the present appeal. The sole issue currently in dispute is the Director's denial regarding exterior building materials, colors, and craftsmanship -related detailing. Background This project was first presented to the City Council on appeal from a Director's approval on April 6, 2015. After holding public hearings on May 4 and November 30, 2015, the Council directed that it be returned to the ARB for further refinement. The project returned to the Council on February 6, 2017, at which time the City Council denied the appeal, approved the Mitigated Negative Declaration and Mitigation and Monitoring Plan, and approved a modified project with conditions. Among these conditions was a requirement the project to return to the ARB to evaluate the following three specific items: a. A decorative wall design treatment, feature or element, shall be applied to the exterior walls immediately adjacent to the southern property line (project's south elevation) b. Landscape details and plans for all proposed planting, including individual planters, the greenwall, and landscaping near the rooftop elevator. c. The exterior building materials, colors and craftsmanship -related detailing associated with the project. The previous staff report from the February 6, 2017 hearing includes extensive background information, project analysis and evaluation against City Codes and Policies. The report, action minutes, transcript, and video of the meeting are available online: February 6, 2017 Document r Link Staff Report https://www.cityofpaloalto.org/civicax/filebank/documents/55707 Action Minutes https://www.cityofpaloalto.org/civicax/filebank/documents/56154 Transcript https://www.cityofpaloalto.org/civicax/filebank/documents/56868 Video http://midpenmedia.org/city-council-115/ On March 20, 2017, staff returned to City Council with written findings contained in a Record of Land Use Action (Attachment D). These findings specifically relied on the existence of the City of Palo Alto Page 2 conditions highlighted above. With respect to the City's former Architectural Review findings,' the conditions were incorporated into findings 2, 4, 5, and 6, relating to context and compatibility: ". . . Conditions of approval for the project also ensure that the design of the building will be compatible with the immediate environment of the site. Conditions No. 3b and 3c require that the applicant return to the ARB for approval of the materials, colors, craftsmanship and landscaping, and Condition No. 3a requires a decorative wall treatment, feature or element along the southern elevation of the building. These requirements will ensure that design features are compatible with the immediate environment of the site...." With respect to the City's current Architectural Review findings, the conditions were incorporated into finding 3, relating to high aesthetic quality and compatibility with the surrounding area: if. .. Lastly, the project, will have high quality materials, textures, colors and finishes because it is conditioned to return to the Architectural Review Board for review and recommendation to the Director of Planning and Community Environment of exterior building materials, colors and craftsmanship -related detailing associated with the project...." March 20, 2017: Document Staff Report Action Minutes Transcript Video Link https://www.cityofpaloalto.org/civicax/filebank/documents/56356 https://www.cityofpaloalto.org/civicax/filebank/documents/56839 https://www.cityofpaloalto.org/civicax/filebank/documents/57427 http://midpenmedia.org/city-council-120/ The applicant submitted project plans on July 30, 2018 addressing the three items conditioned by the City Council. The ARB reviewed these proposals at the August 16, 2018, September 20, 2018, and October 4, 2018 public hearings. All of these reports and minutes are also available online: The project plans reviewed at the October 4, 2018 hearing are available as Attachment H of this staff report and available online: bit.ly/429University. 1 The City Council updated and streamlined its Architectural Review findings in December 2016, which the earlier appeal of the project was pending. The Council's adopted Record of Land Use Action analyzed the project under both the former and current Architectural Review findings. City of Palo Alto Page 3 August 16, 2018 ARB Document Link Staff Report https://www.cityofpaloalto.org/civicax/filebank/documents/66300 Minutes https://www.cityofpaloalto.org/civicax/filebank/documents/66728 Video http://midpenmedia.org/architectural-review-board-74-2-3-2-2-2-2-2-2-2-2-2/ September 20, 2018 Document Link Staff Report https://www.cityofpaloalto.org/civicax/filebank/documents/66720 Minutes https://www.cityofpaloalto.org/civicax/filebank/documents/67283 Video http://midpenmedia.org/architectural-review-board-74-09202018/ October 4, 2018 Document Link Staff Report https://www.cityofpaloalto.org/civicax/filebank/documents/66964 Minutes https://www.cityofpaloalto.org/civicax/filebank/documents/67470 Video https://youtu.be/PKsAfsKOTbA?t=456 On October 4, 2018, the ARB recommended denial of the subject application. After considering the ARB's comments, the Interim Planning and Community Environment Director approved in - part for the design of the west wall (Condition 3A) and the landscaping (Condition 3B). The Interim Direction also denied in -part for the materials, colors and craftsmanship -related detailing associated with the project (Condition 3C) on October 16, 2018. The decision letter is included in Attachment C. On October 18, 2018, the applicant, Kipling Post LP, filed a timely appeal (Attachment B) pursuant to Palo Alto Municipal Code section 18.77.070. The appeal notes that the materials, colors, and craftsmanship are integral features of the project, modeled after buildings at 102- 116 University Avenue. These features were sought with the approval for and granted by Council. The appellant notes that Planning staff did not object to the concrete and had recommended approval to the ARB. The appellant further states that because the project has residential units, the project must be reviewed in the context of California's Housing Accountability Act (CHAA). The appellant states that the purpose of the statute is to limit the ability of local governments to "reject or make infeasible housing developments...without a thorough analysis of the economic, social and environmental effects of the action." Because the residential units are encompassed in the CHAA and comply with objective standards, the City must provide evidence supporting the denial with specific findings that they approval would result in a "specific, adverse impact" on City of Palo Alto Page 4 "public health or safety." The appellant states that no such findings were made, nor can such findings be made as the City has no objective, identified written public health or safety standards or policies that would warrant disapproval. On November 13, 2018, the appellant's attorney, Timothy Kassouni, submitted a letter brief arguing that the appeal must be upheld for a variety of reasons, including that the October 16, 2018 Director's decision conflicted with the Council's findings in Record of Land Use Action 2017-02, that the City's architectural review findings are unconstitutionally vague, and that the CHAA applies to this project. The City Attorney's Office will provide separate, confidential advice evaluating Mr. Kassouni's assertions. Correspondence from Mr. Kassouni is provided in Attachment G. Discussion The Council's purview in this appeal is limited to the items discussed in the Director's decision. Other elements of the project, including the square footage and overall massing of the building, were approved in 2017 and are beyond the scope of the present appeal. Of the items discussed in the Director's decision, only the Director's denial regarding exterior building materials, colors, and craftsmanship -related detailing is disputed by the applicant. Appeal Issue 1: Exterior building materials, colors and craftsmanship -related detailing Response: The ARB reviewed the applicant's proposal for exterior building materials, colors and craftsmanship -related detailing at the August 16, September 20, and October 4, 2018 meetings. Although the ARB was able to provide some feedback at its August 16 and September 20 meetings, which the applicant incorporated into the design — such as use of lighter colors and more clearly differentiating between the upper and lower floors — the applicant did not provide renderings of the craftsmanship -related detailing in context until the October 4, 2018 hearing. Upon reviewing these renderings, the ARB noted that the details were not adequate for approval. More specifically, the project does not comply with the contextual and compatibility criteria of the municipal code in that it does not share general characteristics or establish design linkages with the overall pattern of development. Surrounding buildings have design elements and material detailing that are human -scaled, regardless of the overall building envelope. The ARB found that the project's lack of such features rendered it incompatible with the surrounding area. On October 15, 2018, the Interim Director provided Kipling Post LP an opportunity to incorporate detailing into the design in an effort to secure complete project approval. Kipling Post LP refused the opportunity. The Interim Director's communication to the applicant is provided in Attachment F and states that minor adjustments, such as incorporating sunshades or awnings along University Avenue and adding texture to the exterior concrete on the first and City of Palo Alto Page 5 second floors would bring the project into alignment with the required findings. Appeal Issue 2: Review of the project as a residential project under the California Housing Accountability Act. Response: The project is a mixed -use project, consisting of residential, commercial and office uses. The CHAA applies to "housing development projects," including mixed -used projects with at least two thirds of the square footage designated for residential use. The project approved by the City Council on February 6, 2017 includes 20,407 square feet of non-residential uses and only 8,140 square feet of residential uses. As a result, the project is not subject to the CHAA. Amendment of Record of Land Use Action 2017-02 to extend entitlement The Council's approval of a modified project on February 6, 2017 required that the applicant secure a building permit within one year. In order to allow the applicant to incorporate the Council -directed modifications and to seek ARB approval of the three remaining items, the Planning Director approved a one-year extension of the project entitlement to February 6, 2019, but any further extension would require Council action. The applicant asserts that any expiration of its entitlement would be invalid in light of its good faith attempt to commence construction. If the Council denies the applicant's current appeal or continues the hearing, staff recommends that the Council amend its prior approval to extend the life of the entitlement until December 31, 2019. This extension would avoid potentially unnecessary disputes regarding the validity of the original entitlement while the applicant resolves any remaining issues regarding exterior building materials, colors, and craftsmanship. Environmental Review The subject project has been assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the environmental regulations of the City. On February 6, 2017, the City Council approved the Initial Study and Mitigated Negative Declaration for this project, which is available online at: https://www.cityofpaloalto.org/civicax/filebank/documents/49897 Attachments: Attachment A: Draft Record of Land Use Action (DOCX) Attachment B: October 18, 2018 Appeal of Director's Decision (PDF) Attachment C: October 16, 2018 Director's Decision Letter (PDF) Attachment D: February 6, 2017 Record of Land Use Action (PDF) Attachment E: Location Map (PDF) Attachment F: Email Correspondence to Kipling Post LP, dated October 15, 2018 (PDF) Attachment G: Kassouni Law Kipling Post Correspondence, Dated November 13 and October 31, 2018 (PDF) City of Palo Alto Page 6 Attachment H: Project Plans (DOCX) City of Palo Alto Page 7 APPROVAL NO. RECORD OF THE COUNCIL OF THE CITY OF PALO ALTO LAND USE ACTION FOR 425 AND 429 UNIVERSITY AVENUE: MINOR ARCHITECTURAL REVIEW APPLICATION [18PLN-00240] On December 3, 2018, the City Council of the City of Palo Alto considered an appeal of the Planning and Community Environment Director's decision to deny in part a Minor Architectural Review for the exterior building materials, colors and craftsmanship -related detailing subject to the following findings, determinations and declarations to support their decision: SECTION 1. Background. The City Council of the City of Palo Alto ("City Council") finds, determines, and declares as follows: A The project site is comprised of two lots, 425 and 429 University Avenue (APN Nos. 120-15-029 and 120-15-028, respectively) of approximately 11,000 square feet. The site contains two commercial structures bordered by University Avenue to the southeast, Lane 30 E to the northwest, and Kipling Street to the northeast. Single -story businesses border the site to the northeast along Kipling Street, and one -and -a -half story businesses border the project site along University Avenue. B On February 6, 2017, the City Council denied an appeal, thereby affirming the decision of the Planning and Community Environment Director, approving Kipling Post LP's request for a Major Architectural Review for the development of a mixed -use project on an 11,000 square foot parcel ("The Project"). C On March 20, 2017, the City Council approved written findings and conditions of approval contained in Record of Land Use Action No. 2017-02. Condition of Approval #3 required the Architectural Review Board (ARB) to conduct minor architectural review, evaluating the following: a decorative wall design treatment, feature or element, shall be applied to the exterior walls immediately adjacent to the southern property line (project's south elevation); landscape details and plans for all proposed planting, including individual planters, the green wall, and landscaping near the rooftop elevator; and the exterior building materials, colors and craftsmanship -related detailing associated with the project. D On July 13, 2018 the applicant submitted plans in response to Condition of Approval No. 3. E On August 16, 2018, the Architectural Review Board reviewed the applicant's proposed response to Condition of Approval No. 3 from Record of Land Use Action No. 2107-02, and directed the applicant to return with clarification about how the west wall design relates to the entire building. The motion referenced that the design include more detail and layering to better reflect the architectural design intent resembling a tree -like motif; include construction details that demonstrate the craftsmanship of the building; and, return with details showing how the landscaping would look over time. E The applicant submitted revised plans on August 24, 2018, in response to the ARBs comments. G On September 9, 2018, the project was continued to a date certain on September 20, 2018 to allow the ARB to assemble a quorum. H On September 20, 2018 the ARB requested that the grey color be lightened and that samples of the grey color on the various materials be provided. The ARB was also open to beige colors and warmer colors generally to better integrate the building into the surrounding neighborhood. The ARB requested that the color scheme be divided between the first two floors and the top two floors, which would include making the concrete floors/ceiling between levels consistent with the floor levels; include construction details that demonstrate the craftsmanship of the building; that additional planters be added to the first and fourth level of the building and to have an actual green screen on the rear wall and fourth floor area where the vine is proposed; better integrate the west wall with the building, particularly the top two floors; and, provide a minimum of two high quality photo renderings: the first rendering from University Avenue, looking towards the west wall; the second rendering from Kipling Street, showing the Kipling Street and the Lane 30 elevation. On September 26, 2018, the applicant provided revised plans in response the ARBs September 20, 2018 comments. J The ARB considered the project on October 4, 2018 and recommended denial to the Interim Director of Planning and Community Environment. In making this determination, the Board articulated concerns with the project meeting required architectural review findings, specifically findings number 2 and 3. K On October 15, 2108, the applicant refused the Interim Director's opportunity to incorporate detailing into the design in an effort to secure a complete project approval. L On October 16, 218, the Interim Planning and Community Environment Director issued an approval in part related to the west wall tree -motif design (ROLUA No. 2017-02 Condition of Approval 3a) and landscaping (ROLUA No. 2017-02 Condition of Approval 3b); and denial in part relating to the exterior building materials, colors, and craftsmanship -related detailing associated with the project (ROLUA No. 2017-02 Condition of Approval 3c). M On October 18, 2108, a timely appeal was filed by Kipling Post, LP ("the Appellant") stating that the building materials, colors, and craftsmanship are integral features of the project; that Planning recommended approval to the ARB at three hearings; and that the City did not adopt the correct findings as prescribed by the California Housing Accountability Act to deny the project. N The City Council reviewed the appeal on December 3, 2018, and duly rejected the appeal, hereby affirming the decision of the Interim Planning and Community Environment Director. SECTION 2. Environmental Review. The City as the lead agency for the Project has determined that the project is subject to environmental review under provisions of the California Environmental Quality Act (CEQA) under Guideline section 15070, Decision to Prepare a Negative or Mitigated Negative Declaration. An initial study was prepared for the project in 2014 and was updated in August of 2015 and it was determined that, with the implementation of conditions of approval, and mitigation measures no potentially adverse impacts would result from the development, therefore, the project would have a less than significant impact on the environment. SECTION 3. Architectural Review Findings. Pursuant to Palo Alto Municipal Code Section 18.76.020(d), neither the director, nor the city council on appeal, shall grant architectural review approval, unless it is found that the project is consistent with certain adopted findings. At the time that the project application was filed and appealed to Council, the findings presented in this section were in use, and the Council finds that the project is consistent with them as follows: Finding #1: The design is consistent with applicable provisions of the Palo Alto Comprehensive Plan, Zoning Code, coordinated area plans (including compatibility requirements), and any relevant design guides. The proposed decorative wall treatment and landscape plan are consistent with this finding in that it is in general conformance with the Downtown Design Guidelines and the following Comp Plan Goals and Policies. With respect to the exterior building materials, colors and craftsmanship -related detailing, however, the project is inconsistent with Comp Plan policies L-1.3 and L-4.7, as detailed below. Comp Plan Goals and Policies How project adheres or does not adhere to Comp Plan The Comprehensive Plan land use designation for the site is Regional/Community Commercial The project proposes landscaping, materials and color board, and decorative wall design treatment to a previously approved building that is consistent with the Regional/Community Commercial designation Land Use and Community Design Element Goal 1-1: A compact and resilient city providing residents and visitors with attractive neighborhoods, work places, shopping districts, public facilities and open spaces. The project is a compact mixed -use development along University Avenue. It contributes to an attractive neighborhood through the use of long lasting materials, landscaping, and a decorative design to the interior property line wall. Policy L-1.3: Infill development in the urban service area should be compatible with its surroundings and the overall scale and character of the city to ensure a compact, efficient development pattern. The decorative wall treatment and landscape plan are compatible the project's surroundings and with the overall scale and character of the City in that they add visual interest to the project, retain or replace existing street trees, and otherwise represent sustainable principles of design. The building exterior is not compatible with its surroundings, however, because it fails to incorporate detail and craftsmanship in design that is similar to the surrounding buildings. Goal L-2: An enhanced sense of community with development designed to foster public life, meet citywide needs and embrace the principles of sustainability. The project uses native indigenous landscaping and drip irrigation systems that represent sustainable principles of design. Policy L-4.7: Maintain and enhance the University Avenue/Downtown area as a major commercial center of the City, with a mix of commercial, civic, cultural, recreational and residential uses. Promote quality design that recognizes the regional and historical importance of the area and reinforces its pedestrian character. The project consists of a quality designed building by treating the west wall elevation with a pattern that breaks up the fagade, employs long lasting materials in the form of concrete, and strategically places landscaping in key open space areas of the building. The project fails, however, to apply level of detail found in the surrounding area to other parts of the building exterior, which features several large, blank walls. Finding #2: The project has a unified and coherent design, that: a. creates an internal sense of order and desirable environment for occupants, visitors, and the general community, b. preserves, respects and integrates existing natural features that contribute positively to the site and the historic character including historic resources of the area when relevant, c. is consistent with the context -based design criteria of the applicable zone district, d. provides harmonious transitions in scale, mass and character to adjacent land uses and land use designations, e. enhances living conditions on the site (if it includes residential uses) and in adjacent residential areas. The proposed decorative wall treatment and landscape plan are consistent with this finding. The decorative wall treatment provides an aesthetic element that enhances the design and provides an alternative to a blank wall at the upper floor elevations. The proposed landscaping plan provides color, softens and integrates well with the building architecture. With respect to the exterior building materials, colors and craftsmanship -related detailing, however, the project is inconsistent with Findings 2c and 2d. The project does comply with contextual and compatibility criteria set forth in the City's municipal code. Compatibility is achieved when new construction shares general characteristics and establishes design linkages with the overall pattern of buildings so that the visual unity of the street is maintained. Existing buildings in the surrounding area are pedestrian- and human -scaled containing rich architectural details that promote visual interest and warm colors that create an inviting pedestrian experience. By contrast, the proposed project uses exterior building materials (concrete) and colors (gray) that results in a design with little to no architectural detailing and no design linkages that reflect the overall pattern of buildings in the area. Visual unity is disrupted by the proposed use of building materials, colors and limited detailing and is not contextually appropriate to the area. More specifically, the project does not comply the context -based criteria in PAMC sections 18.18.11O(b)(1)(B)1; 18.18.11O(b)(2)(B)2; 18.18.11O(b)(2)(C)3, which seek to promote pedestrian -oriented design by incorporating covered waiting areas, weather protection, projecting overhangs, appropriately sized recessed building entrances and other architectural elements that promote a human scale. Finding #3: The design is of high aesthetic quality, using high quality, integrated materials and appropriate construction techniques, and incorporating textures, colors, and other details that are compatible with and enhance the surrounding area. The proposed decorative wall treatment uses integrated materials and appropriate construction techniques. The proposed landscaping plan incorporates drought tolerant species and a variety of trees, shrubs and perennials suitable to the site. With respect to the exterior building materials, colors and craftsmanship -related detailing, however, the project 1 PAMC 18.18.110(b)(1)(B): On primary pedestrian routes, climate and weather protection where possible, such as covered waiting areas, building projections and colonnades, and awnings (Figure 1-2). 2 PAMC 18.18.110(b)(2)(B): Facades that include projecting eaves and overhangs, porches, and other architectural elements that provide human scale and help break up building mass (Figure 2-2). 3 PAMC 18.18.110(b)(2)(C): Entries that are clearly defined features of front facades, and that have a scale that is in proportion to the size and type of the building and number of units being accessed; larger buildings should have a more prominent building entrance, while maintaining a pedestrian scale. is not consistent with this finding. The proposed textures, colors and craftsmanship are not compatible with and do not enhance the surrounding area. The surrounding area predominately consists of buildings that include a warm color palette and architectural detailing that promotes the pedestrian -oriented environmental along University Avenue. Comparably scaled buildings in the area, such as 432 and 488 University include warm colors, varied construction materials and detailing that adds relief and dimension at the first and second levels. Some of these details include Juliet balconies, faux balustrade screens in front of windows, recessed store fronts, awnings and recessed windows that enhance the pedestrian -scale and experience. Other nearby, lower -profile buildings similarly employ planters, decorative lighting, and architectural detailing that enhance the area. The proposed project, however, uses flat textures and glazing combined with a cool color palate and includes no architectural details that relate to or enhance the pedestrian environment and results in building that stands in stark contrast to other improvements in the area. To achieve compliance with this finding based on the existing, previously approved mass and scale, the applicant could explore using building materials, colors and craftsmanship -related detailing that adds a depth of dimension and visual relief to enhance the surrounding area. The use of textured concrete in a warmer color palate combined with other pedestrian -scale features, such as awnings or sunscreens would be more compatible with the type of development found along pedestrian - oriented University Avenue. Finding #4: The design is functional, allowing for ease and safety of pedestrian and bicycle traffic and providing for elements that support the building's necessary operations (e.g. convenient vehicle access to property and utilities, appropriate arrangement and amount of open space and integrated signage, if applicable, etc.). The project is consistent with this finding in that the proposed elements that are being considered in this application are located in appropriate locations and do not impede the ease or safety of pedestrians or cyclists and generally support the buildings operations. Finding #5: The landscape design complements and enhances the building design and its surroundings, is appropriate to the site's functions, and utilizes to the extent practical, regional indigenous drought resistant plant material capable of providing desirable habitat that can be appropriately maintained. The project is consistent with the finding because it preserves existing street trees along University Avenue and replaces trees along Kipling Street. The project's landscaping includes drought tolerant species and a variety of trees, shrubs and perennials suitable to the site. The plantings focus on the most logical locations in the building that consist of open circulation areas, and along areas accessible to the public, such as along the Lane 30 alley. Finding #6: The project incorporates design principles that achieve sustainability in areas related to energy efficiency, water conservation, building materials, landscaping, and site planning. In accordance with the City's Green Building Regulations, the building will satisfy the requirements for CALGreen Mandatory + Tier 2. A summary of the project's compliance is on sheet GB -1 of the plans. The project includes a number of measures to preserve water including using drip irrigation and proposing landscaping that is drought tolerant and is less than 500 square feet in size. The small area of landscaping and compliance with CALGreen Mandatory + Tier 2will achieve sustainable principles related to energy efficiency and water conservation. SECTION 4. Term of Approval. For the portions of this project that were approved, this entitlement shall expire at the same time as the previously granted entitlement (ROLUA No. 2017-02). SECTION 5. Amendment of Record of Land Use Action 2017-02. Section 7 (Conditions of Approval) of Record of Land Use Action 2017-02 is hereby amended to amend Condition 12, Expiration to read as follows: "12. EXPIRATION. The project approval shall be valid until December 31, 2019. In the event a building permit(s) is not secured for the project within the time limit specified above, the Architectural Review approval shall expire and be of no further force or effect. The project approval is not eligible for further extension by the Director." PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk Mayor APPROVED AS TO CONTENT: Interim Director of Planning and Community Environment APPROVED AS TO FORM: Senior Asst. City Attorney CITY OF PALO ALTO ' Office of the City Clerk CITY OF PALO ALTO. CA APPEAL FROM THE DECISION OF DIRECTOR OF PLANNINt3Y CLERK'S OFFICE AND COMMUNITY ENVIRONMENT* I8OCTI8 PH3:08 For appeals of final decisions on Architectural Review Board and Home Improvement Exception applications (rendered after public hearing), this appeal form shall be completed and submitted by appellant within fourteen days from date of the Director's decision. Appeals of final decisions on Individual Review applications (rendered after public hearing) must be submitted within ten days of the Director's decision. Complete form, the current fee and a letter stating reasons for the appeal shall be submitted to front desk staff of the Planning Division, 5th floor, City Hall, 250 Hamilton Avenue, except for 980 Fridays when City Hall is closed, when these items shall be submitted to Planning staff at the Development Center, 285 Hamilton Avenue (glass storefront across from City Hall on the comer of Bryant and Hamilton). Director of Planning includes his designees, which are Planning Managers or the Chief Planning Official Appeal Application No: 1 ' P1_1'J 00240 Name of Appellant �3� 1 L -Llr I ( P--(-0 @ �+� Address 7p. 0 , I o )a i) P-- (-o Q (#o, Street 7 Receipt No. Phone (kl) 81 - 3o S" 1 R y 3o'Z- City ZIP LOCATION OF PROPERTY SUBJECT TO APPEAL: Street Address 4Z-1° 1/42gity / LE Name of Property Owner (if other than appellant) h ii24-4 J Po L✓P Property Owner's Address 0 , 2C) T P, A47b f V3 WI -- Street City ZIP The decision of the Director of Planning and Community Environment dated 0072, t 7i_ 1(o , 20 1 g whereby the application 1 `(2,• PL bO2144Ry %J9LI/JC Po LT (file number) (original project applicant) was Derd 1 , is hereby appealed for the reasons d in the attached letter (in duplicate) (approved/denied) �' Date: (° 1 3 Signature of Appellant PLANNING COMMISSION RECOMMENDATION TO THE CITY COUNCIL (TO BE FILLED OUT BY STAFF): Date Approved Remarks and/or Conditions: Denied CITY COUNCIL DECISION (TO BE FILLED OUT BY STAFF): Date Approved Remarks and/or Conditions: Denied SUBMITTAL REQUIREMENTS SATISFIED: / 1. Letter stating reasons for appeal V/ Received by: 2. Fee (currently $280.00) '/ Received by: APPEAL FROM THE DECISION OF DIRECTOR OF PLANNING AND COMMUNITY ENVIRONMENT October 18, 2018 This letter is in support of the appeal of the decision by the Director of Planning and Community Environment for the project proposed at 429 University Avenue in his letter dated October 16, 2018 [18-PLN00240]. The project, as presented to the Architectural Review Board Minor Level Review (ARB) at its three hearings on August 16, September 20, and October 4, 2018, was for minor architectural review of (a) west wall details, (b) landscape and (c) exterior building materials, colors and craftsmanship to fulfill conditions of approval stated in the Land Use Approval letter by City Council dated February 6, 2017. Planning concurred that the plans presented to the ARB are in conformance with Option 1, which is the project version approved by Council, and subsequently presented the plans to ARB for review of the three items above. In his determination letter dated October 16, 2018, Items (a) and (b) above were approved by the Director of Planning and are not objected to in this appeal. Item (c) was denied although the exterior building materials, colors and craftsmanship are integral features of this project, are modeled after buildings at 102 - 116 University Ave, and were what Applicant sought approval for and granted by Council. Furthermore, Planning, in its many iteration of review, never objected to the concrete, it being a large component of the Option 1 design approved by Council. In fact, Item (c) was recommended by Planning for approval to the ARB at all three hearings and such recommendation for approval is well documented in all three Staff Reports to ARB by Planning. This project was panned by the ARB Major Review in each of its past hearings which caused the project to appear and subsequently be approved by Council. The Minor Level ARB had similar negative biases against this project. To further complicate the review only three members were available to hear this project as two of its members were recused for various reasons. Of the 3 remaining members, Chair Alexander Lew voted to approve and members Robert Gooyer ("I never liked the project .... it will go before council anyway") and member Osma Thompson voted to disapprove. Ms. Thompson, as a new member of the ARB, had not had the benefit of the lengthy discussion and review process which ultimately resulted in Council's approval of this building. The approved building is modern by design. In her comments at the ARB, Ms. Thompson repeatedly said that the modern style of the building was massive and not compatible with downtown Palo Alto, even though there are many examples of modern buildings existing next to traditional styles in the vicinity of the project. Further, massiveness and compatibility of the project was already approved by Council and not relevant to item (c) above and not the subject of the ARB review. Because this project has residential units, the project must be reviewed in the context of California's Housing Accountability Act (CHAA). (Government Code § 65589.5.) The purpose of this statute is to limit the ability of local governments to "reject or make infeasible housing developments ... without a thorough analysis of the economic, social, and environmental effects of the action...." (§ 65589.5, subd. (b).) Subdivision (j) of the statute provides that "[w]hen a proposed housing development project complies with applicable, objective general plan and zoning standards and criteria, including design review standards, in effect at the time that the housing development project's application is determined to be complete," a local agency which "proposes to disapprove the project ... shall base its decision regarding the proposed housing development project upon written findings supported by substantial evidence on the record that ... [¶] (1) [t]he housing development project would have a specific, adverse impact upon the public health or safety unless the project is disapproved" and "(2) [t]here is no feasible method to satisfactorily mitigate or avoid the adverse impact ... other than the disapproval of the housing development project...." Residential housing projects, such as that proposed by theApplicant, are expressly included in the CHAA as a "housing development project." (See Government Code § 65589.5, subd. (h)(2) (A)(C).) Applicant's project is intended to include the construction of three residential housing units in a City with a severe housing shortage. The ARB has not articulated any public health or safety rationale for disapproval. Because the residential units are encompassed within the CHAA, and comply with all objective standards, the burden of proof shifts to the City and ARB to support denial with specific findings that approval would result in a "specific, adverse impact" on "public health or safety." The phrase "specific, adverse impact" means a "significant, quantifiable, direct, and unavoidable impact, based on objective, identified written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete." (Government Code § 65589.5, subd. (j)(1). (Emphasis added.) No such findings were made, nor can such findings be made as the City has no objective, identified written public health or safety standards or policies that would warrant disapproval. Respectfully submitted, Kipling Post LP PLANNING & COMMUNITY ENVIRONMENT CITY OF PALO ALTO 250 Hamilton Avenue, 5th Floor Palo Alto, CA 94301 650.329.2441 October 16, 2018 Peter Ko Ko Architects 900 High Street Palo Alto, CA 94301 Subject: 429 University Avenue [18PLN-00240] Minor ARB Review Pursuant to Condition of Approval No. 3 from Record of Land Use Action No. 2017-2 Dear Mr. Ko: On October 4, 2018, the Architectural Review Board recommended denial of the subject application. After considering the Board's comments, I am approving in -part and denying in - part this application on October 16, 2018. The decision is effective 14 days from the date of this letter, unless an appeal is filed in accordance with Title 18 of the Palo Alto Municipal Code. The denial is based on the findings in Attachment A and is for the project described below. In accordance with the City Council approved Record of Land Use Decision (Approval No. 2017- 2), the subject development is required to obtain approval from the director of Planning and Community Environment, for the following prior to the issuance of building permits: a. A decorative wall design treatment, feature or element, shall be applied to the exterior walls immediately adjacent to the southern property line (project's south elevation) starting at an elevation equivalent to the building height of the adjacent structure and extending to the roofline of the proposed building. b. Landscape details and plans for all proposed planting, including individual planters, the greenwall, and landscaping near the rooftop elevator. c. The exterior building materials, colors and craftsmanship -related detailing associated with the project. The application is approved with respect to the decorative wall treatment for the project's west elevation and the landscape details; it is denied with respect to exterior building materials, colors, and craftsmanship -related details. Findings and conditions for this decision are provided in Attachment A. The denial in part is consistent with comments and concerns expressed by Architectural Review Board Members at its August 16, September 20, and October 4, 2018 meetings regarding the CityOfPaloAito.org exterior detailing and craftsmanship of the project. It also follows Kipling Post LP's refusal, on October 15, 2018, of my suggestion to incorporate detailing into the design in an effort to secure a complete project approval. Should you have any questions regarding this determination, please do not hesitate to contact the Project Planner, Adam Petersen, by email at apetersen@m-group.us or by phone at (408)340-5642. Sincerely, han Lait, ' ICP terim Director Planning and Community Environment c: Elizabeth Wong, Kipling Post LP, PO Box 204 Palo Alto CA 94302 Attachments: A: Project Findings and Conditions of Approval ATTACHMENT A FINDINGS AND CONDITIONS OF APPROVAL 429 University Avenue / File No. 18PLN-00240 The subject project complies with all applicable findings set forth in Palo Alto Municipal Code (PAMC) Chapter 18.76, with the exception of Findings 1, 2, and 3 with respect to exterior building colors, materials and craftsmanship, as detailed below. Finding #1: The design is consistent with applicable provisions of the Palo Alto Comprehensive Plan, Zoning Code, coordinated area plans (including compatibility requirements), and any relevant design guides. The proposed decorative wall treatment and landscape plan are consistent with this finding in that it is in general conformance with the Downtown Design Guidelines and the following Comp Plan Goals and Policies. With respect to the exterior building materials, colors and craftsmanship -related detailing, however, the project is inconsistent with Comp Plan policies L- 1.3 and L-4.7, as detailed below. Comp Plan Goals and Policies How project adheres or does not adhere to Comp Plan The Comprehensive Plan land use designation for the site is Regional/Community Commercial The project proposes landscaping, materials and color board, and decorative wall design treatment to a previously approved building that is consistent with the Regional/Community Commercial designation Land Use and Community Design Element Goal 1-1: A compact and resilient city providing residents and visitors with attractive neighborhoods, work places, shopping districts, public facilities and open spaces. The project is a compact mixed -use development along University Avenue. It contributes to an attractive neighborhood through the use of long lasting materials, landscaping, and a decorative design to the interior property line wall. Policy L-1.3: InfiWI development in the urban service area should be compatible with its surroundings and the overall scale and character of the city to ensure a compact, efficient development pattern. The decorative wall treatment and landscape plan are compatible the project's surroundings and with the overall scale and character of the City in that they add visual interest to the project, retain or replace existing street trees, and otherwise represent sustainable principles of design. The building exterior is not compatible with its surroundings, however, because it fails to incorporate detail and craftsmanship in design that is similar to the surrounding buildings. Goal L-2: An enhanced sense of community The project uses native indigenous landscaping with development designed to foster public and drip irrigation systems that represent life, meet citywide needs and embrace the principles of sustainability. sustainable principles of design. Policy L-4.7: Maintain and enhance the The project consists of a quality designed University Avenue/Downtown area as a major building by treating the west wall elevation commercial center of the City, with a mix of commercial, civic, cultural, recreational and with a pattern that breaks up the facade, employs long lasting materials in the form of residential uses. Promote quality design that concrete, and strategically places landscaping recognizes the regional and historical in key open space areas of the building. The importance of the area and reinforces its project fails, however, to apply level of detail pedestrian character. found in the surrounding area to other parts of the building exterior, which features several large, blank walls. Finding #2: The project has a unified and coherent design, that: a. creates an internal sense of order and desirable environment for occupants, visitors, and the general community, b. preserves, respects and integrates existing natural features that contribute positively to the site and the historic character including historic resources of the area when relevant, c. is consistent with the context -based design criteria of the applicable zone district, d. provides harmonious transitions in scale, mass and character to adjacent land uses and land use designations, e. enhances living conditions on the site (if it includes residential uses) and in adjacent residential areas. The proposed decorative wall treatment and landscape plan are consistent with this finding. The decorative wall treatment provides an aesthetic element that enhances the design and provides an alternative to a blank wall at the upper floor elevations. The proposed landscaping plan provides color, softens and integrates well with the building architecture. With respect to the exterior building materials, colors and craftsmanship -related detailing, however, the project is inconsistent with Findings 2c and 2d. The project does comply with contextual and compatibility criteria set forth in the City's municipal code. Compatibility is achieved when new construction shares general characteristics and establishes design linkages with the overall pattern of buildings so that the visual unity of the street is maintained. Existing buildings in the surrounding area are pedestrian- and human -scaled containing rich architectural details that promote visual interest and warm colors that create an inviting pedestrian experience. By contrast, the proposed project uses exterior building materials (concrete) and colors (gray) that results in a design with little to no architectural detailing and no design linkages that reflect the overall pattern of buildings in the area. Visual unity is disrupted by the proposed use of building materials, colors and limited detailing and is not contextually appropriate to the area. More specifically, the project does not comply the context -based criteria in PAMC sections 18.18.110(b)(1)(B)1; 18.18.110(b)(2)(B)2; 18.18.110(b)(2)(C)3, which seek to promote pedestrian -oriented design by incorporating covered waiting areas, weather protection, projecting overhangs, appropriately sized recessed building entrances and other architectural elements that promote a human scale. Finding #3: The design is of high aesthetic quality, using high quality, integrated materials and appropriate construction techniques, and incorporating textures, colors, and other details that are compatible with and enhance the surrounding area. The proposed decorative wall treatment uses integrated materials and appropriate construction techniques. The proposed landscaping plan incorporates drought tolerant species and a variety of trees, shrubs and perennials suitable to the site. With respect to the exterior building materials, colors and craftsmanship -related detailing, however, the projectis not consistent with this finding. The proposed textures, colors and craftsmanship are not compatible with and do not enhance the surrounding area. The surrounding area predominately consists of buildings that include a warm color palette and architectural detailing that promotes the pedestrian -oriented environmental along University Avenue. Comparably scaled buildings in the area, such as 432 and 488 University include warm colors, varied construction materials and detailing that adds relief and dimension at the first and second levels. Some of these details include Juliet balconies, faux balustrade screens in front of windows, recessed store fronts, awnings and recessed windows that enhance the pedestrian -scale and experience. Other nearby, lower -profile buildings similarly employ planters, decorative lighting, and architectural detailing that enhance the area. The proposed project, however, uses flat textures and glazing combined with a cool color palate and includes no architectural details that relate to or enhance the pedestrian environment and results in building that stands in stark contrast to other improvements in the area. To achieve compliance with this finding based on the existing, previously approved mass and scale, the applicant could explore using building materials, colors and craftsmanship -related detailing that adds a depth of dimension and visual relief to enhance the surrounding area. The use of textured concrete in a warmer color palate combined with other pedestrian -scale features, such as awnings or sunscreens would be more compatible with the type of development found along pedestrian - oriented University Avenue. 1 PAMC 18.18.110(b)(1)(B): On primary pedestrian routes, climate and weather protection where possible, such as covered waiting areas, building projections and colonnades, and awnings (Figure 1-2). 2 PAMC 18.18.110(b)(2)(B): Facades that include projecting eaves and overhangs, porches, and other architectural elements that provide human scale and help break up building mass (Figure 2-2). 3 PAMC 18.18.110(b)(2)(C): Entries that are clearly defined features of front facades, and that have a scale that is in proportion to the size and type of the building and number of units being accessed; larger buildings should have a more prominent building entrance, while maintaining a pedestrian scale. Finding #4: The design is functional, allowing for ease and safety of pedestrian and bicycle traffic and providing for elements that support the building's necessary operations (e.g. convenient vehicle access to property and utilities, appropriate arrangement and amount of open space and integrated signage, if applicable, etc.). The project is consistent with this finding in that the proposed elements that are being considered in this application are located in appropriate locations and do not impede the ease or safety of pedestrians or cyclists and generally support the buildings operations. Finding #5: The landscape design complements and enhances the building design and its surroundings, is appropriate to the site's functions, and utilizes to the extent practical, regional indigenous drought resistant plant material capable of providing desirable habitat that can be appropriately maintained. The project is consistent with the finding because it preserves existing street trees along University Avenue and replaces trees along Kipling Street. The project's landscaping includes drought tolerant species and a variety of trees, shrubs and perennials suitable to the site. The plantings focus on the most logical locations in the building that consist of open circulation areas, and along areas accessible to the public, such as along the Lane 30 alley. Finding #6: The project incorporates design principles that achieve sustainability in areas related to energy efficiency, water conservation, building materials, landscaping, and site planning. In accordance with the City's Green Building Regulations, the building will satisfy the requirements for CALGreen Mandatory + Tier 2. A summary of the project's compliance is on sheet GB -1 of the plans. The project includes a number of measures to preserve water including using drip irrigation and proposing landscaping that is drought tolerant and is less than 500 square feet in size. The small area of landscaping and compliance with CALGreen Mandatory + Tier 2will achieve sustainable principles related to energy efficiency and water conservation. CONDITIONS OF APPROVAL 429 University Avenue: 18PLN-00240 PLANNING DIVISION 1. CONFORMANCE WITH PLANS. This approval is granted only for the proposed construction of the tree motif decorative wall treatment at the west elevation and the landscape plans and shown on the project plans and supporting application material stamped as received by the City on July 30, 2018 on file with the Planning Department, 250 Hamilton Avenue, Palo Alto, California except as modified by these conditions of approval. No approval is granted for the exterior materials or colors. 2. BUILDING PERMIT PLAN SET. The ARB approval letter including all Department conditions of approval for the project shall be printed on the plans submitted for building permit. 3. PROJECT MODIFICATIONS: Any modifications to the approved decorative wall treatment or landscape plan shall be submitted for review and approval prior to construction. If during the Building Permit review and construction phase, the project is modified by the applicant, it is the responsibility of the applicant to contact the Planning Division/project planner directly to obtain approval of the project modification. It is the applicant's responsibility to highlight any proposed changes to the project and to bring it to the project planner's attention. 4. PROJECT EXPIRATION. This project approval shall be incorporated with and subject to the same permit time limits that apply to Record of Land Use Action No. 2017-2, approved on March 20, 2017. In the event a building permit(s), if applicable, is not secured for the project within the time limit specified above, the ARB approval shall expire and be of no further force or effect. 5. INDEMNITY: To the extent permitted by law, the Applicant shall indemnify and hold harmless the City, its City Council, its officers, employees and agents (the "indemnified parties") from and against any claim, action, or proceeding brought by a third party against the indemnified parties and the applicant to attack, set aside or void, any permit or approval authorized hereby for the Project, including (without limitation) reimbursing the City for its actual attorneys' fees and costs incurred in defense of the litigation. The City may, in its sole discretion, elect to defend any such action with attorneys of its own choice. 6. DEVELOPMENT IMPACT FEES: Per PAMC 16.61.040, and RLUA No. 2017-2, all applicable Development Impact Fees shall be paid prior to the issuance of the related building permit. 7. FINAL INSPECTION: A Planning Division Final inspection will be required to determine substantial compliance with the approved plans prior to the scheduling of a Building Division final. Any revisions during the building process must be approved by Planning, including but not limited to; materials, landscaping and hard surface locations. Contact your Project Planner, Adam Petersen at apetersen@m-group.us to schedule this inspection. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F APPROVAL NO. 2017- 2 RECORD OF THE COUNCIL OF THE CITY OF PALO ALTO LAND USE ACTION FOR 425 AND 429 UNIVERSITY AVENUE: MAJOR ARCHITECTURAL REVIEW APPLICATION [14PLN-0022] On February 6, 2017, the City Council of the City of Palo Alto considered an appeal of the Planning and Community Environment Director's decision to approve a Major Architectural Review for the development of a four-story, 50 -foot tall, 28,547 square -foot, mixed -use project at 429 University Avenue and directed staff to return to Council with the following findings, determinations and declarations to support their decision to adopt a modified project design: SECTION 1. Background. The City Council of the City of Palo Alto ("City Council") finds, determines, and declares as follows: A The project site is comprised of two lots, 425 and 429 University Avenue (APN Nos. 120-15- 029 and 120-15-028, respectively) of approximately 11,000 square feet. The site contains two commercial structures bordered by University Avenue to the southeast, Lane 30 E to the northwest, and Kipling Street to the northeast. Single -story businesses border the site to the northeast along Kipling Street, and one and two story buildings border the project site along University Avenue. B On June 19, 2014, Kipling Post LP applied for a Major Architectural Review for the development of a mixed -use project on an 11,000 square foot parcel ("The Project"). C On February 25, 2015, the Planning and Community Environment Director approved the Major Architectural Review. D On March 11, 2015, a timely appeal was filed by Dr. Michael Harbour ("the Appellant") stating concerns related to parking, traffic and circulation concerns and safety issues, impacts to historical resources, and the size and massing of the project E On May 4, 2015, the City Council remanded the project to the Historic Resource Board (HRB) and Architectural Review Board (ARB) for further review and requested project revisions to address issues of scale and compatibility. Specifically, the Council requested that the applicant redesign the project and return to the HRB and ARB to address a variety of concerns. The HRB was asked to review and comment on the historic resource evaluation report as it relates to the project's potential impact to other historic resources in the area; the applicable 'area of potential affect' pursuant to the California Environmental Quality Act (CEQA); the potential impact of the project's mass, scale and compatibility to existing historic properties; and whether the proposed building would change the setting of the historic properties on Kipling Street or University Avenue and have an impact under CEQA. The Council directed the ARB to evaluate the project's compatibility with the immediate environment of the site; neighborhood character; other buildings in the area; consistency with the roof lines, entries, setbacks, mass and scale with context based design criteria; shadow patterns; vehicular access to the site, including possible impacts to Lane 30 (alley) circulation; and, to provide direction on the design linkages with the overall pattern of development in the area. On September 10 and 17, 2015, the HRB and ARB, respectively, considered project revisions presented by the applicant. Their respective comments are available in the administrative record and meeting minutes. The HRB members expressed concern with various aspects of the project, notably related to the mass and scale of the proposed building and expressed concerns regarding the project's compatibility to nearby designed Birge Clark buildings and the Victorian -style structures on Kipling Street. The ARB had a variety of comments regarding the project, including expressing concerns with project compatibility when viewed from Kipling Street and encouraged further architectural DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F refinement to address other concerns expressed by Council. On November 30, 2015, the City Council remanded the project to ARB for further review and consideration as it relates to the following specific Architectural Review Findings and Context -Based Design Criteria: PAMC chapter 18.76.020(d): • (1): Architectural Review Findings in relation to design's consistency and compatibility with applicable elements of the Palo Alto Comprehensive Plan • (2): Architectural Review Findings in relation to design's compatibility with the immediate environment of the site • (4): Architectural Review Findings in relation to design's compatibility with areas as having a unified design character or historic character • (12): Architectural Review Findings in relation to compatibility and appropriateness in materials, textures, colors, details of construction and plant materials to the project's function and to adjacent structures, landscape elements and functions And PAMC Section 18.18.110 • (a)(2)(B)(i): Contextual and Compatibility Criteria — Compatibility goal in relation to siting, scale, massing and materials • (a)(2)(B)(iii): Contextual and Compatibility Criteria — Compatibility goal in relation to pattern of roof lines and projections • (b)(2)(B): Context -based Design Considerations and Findings — Street building facades in relation to eaves, overhang, porches and other architectural elements that provide human scale and help break up building mass F. On March 17, 2016 the applicant returned to the ARB with a revised project, consisting of two options prepared by Topos Architecture. The ARB preferred Option B with recommended changes to better reduce building scale and mass, and continued the project to May 19, 2016. G On August 4 the applicant returned to the ARB with a revised project prepared by Jo Bellomo and Associates, the fourth design professional known to the City to be engaged by the applicant to prepare plans and make presentations regarding the project. Based on the administrative record, including meeting minutes, the ARB expressed concern that this latest iteration was not responsive to earlier ARB or City Council comments and requested staff prepare recommended findings to deny the project. H On September 1, 2016, at the applicant's request, the ARB conducted a study session of a project that closely resembled Option 1. While ARB members continued to express concerns, the Board commented that this design concept showed progress toward addressing previously stated concerns regarding the project's compatibility to adjacent structures and neighborhood character. The ARB reviewed a project on October 20, 2016 (described as Option 2 in the February 6, 2017 City Council report). This design included changes that increased the mass of the building at the street corner on the third floor and additional mass on the fourth floor that was previously removed from the plans reviewed on September 1, 2016. The ARB forwarded a recommendation of denial of the project to the City Council. J The Applicant submitted revised plans on October 26, 2016 (described as Option 1 in the February 6, 2017 City Council report), which was a refined version of the plans presented at a study session of the ARB on September 1, 2016, which addressed many of the Board's comments. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F K The Applicant submitted revised plans on December 8, 2016 (described as Option 3 in on the February 6, 2017 City Council report), which represented another iteration of the Option 1 design, but included concepts previously reviewed by the ARB on August 4, 2016. L The City Council reviewed Option 1, Option 2, and Option 3 of the project on February 6, 2017 and approved Option 1 based on the findings and subject to the conditions of approval included below. SECTION 2. Environmental Review. The City as the lead agency for the Project has determined that the project is subject to environmental review under provisions of the California Environmental Quality Act (CEQA) under Guideline section 15070, Decision to Prepare a Negative or Mitigated Negative Declaration. An initial study was prepared for the project in 2014 and was updated in August of 2015 and it was determined that, with the implementation of conditions of approval, and mitigation measures no potentially adverse impacts would result from the development, therefore, the project would have a less than significant impact on the environment. SECTION 3. Architectural Review Findings. Pursuant to Palo Alto Municipal Code Section 18.76.020(d), neither the director, nor the city council on appeal, shall grant architectural review approval, unless it is found that the project is consistent with certain adopted findings. At the time that the project application was filed and appealed to Council, the findings presented in this section were in use, and the Council finds that the project is consistent with them as follows: Comprehensive Plan and Purpose of ARB: Finding #1: The design is consistent and compatible with applicable elements of the Palo Alto Comprehensive Plan. Finding #16: The design is consistent and compatible with the purpose of architectural review, which is to: • Promote orderly and harmonious development in the city; • Enhance the desirability of residence or investment in the city; • Encourage the attainment of the most desirable use of land and improvements; • Enhance the desirability of living conditions upon the immediate site or in adjacent areas; and • Promote visual environments which are of high aesthetic quality and variety and which, at the same time, are considerate of each other. The project is consistent with Findings #1 and #16 because: On balance, the project is consistent and compatible with applicable elements of the Palo Alto Comprehensive Plan. The proposed project is in conformance with the following Comprehensive Plan Goals and Policies. The project is compatible with the surrounding development based on the building's size, scale and mass. The project reflects a similar massing and rhythm to other properties along University Avenue and includes building articulate and setbacks at the third and fourth floors that provide for an appropriate transition, particularly along Kipling Street, to the lower profile buildings nearby. Some of the goals and policies the project is in compliance with include the following: • Goal 1-1: A well -designed, compact city, providing residents and visitors with attractive neighborhoods, work places, shopping district, public facilities and open spaces. • Policy L-5: Maintain the scale and character of the City. Avoid land uses that are overwhelming and unacceptable due their size and scale. • Goal L-4: Inviting, pedestrian -scale centers that offer a variety of retail and commercial services and DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F provide focal points and community gathering places for the City's residential neighborhoods and Employment Districts. • Policy L-20: Encourage street frontages that contribute to retail vitality in all Centers. Reinforce street corners with buildings that come up to the sidewalk or that form corner plazas. • Policy L-23: Maintain and enhance the University Avenue/Downtown area as the central business district of the City, with a mix of commercial, civic, cultural, recreational and residential uses. Promote quality design that recognizes the regional and historical importance of the area and reinforces its pedestrian character. • Policy L-24: Ensure that University Avenue/Downtown is pedestrian -friendly and supports bicycle use. Use public art and other amenities to create an environment that is inviting to pedestrians. • Goal L-6: Well -designed buildings that create coherent development patterns and enhance city streets and public spaces. • Policy L-48: Promote high quality, creative design and site planning that is compatible with surrounding development and public spaces. • Policy L-49: Design buildings to revitalize streets and public spaces and to enhance a sense of community and personal safety. Provide an ordered variety of entries, porches, windows, bays and balconies along public ways where it is consistent with neighborhood character; avoid blank or solid walls at street level; and include human -scale details and massing. • Goal T-3: Facilities, services and programs that encourage and promote walking and bicycling. • Policy T-21: Support the use of Downtown alleyways for pedestrian- and bicycle -only use. • Policy T-23: Encourage pedestrian -friendly design features such as sidewalks, street trees, on -site parking, public spaces, gardens, outdoor furniture, art, and interesting architectural details. Option 1, as presented to the City Council on February 6, 2017, provides a transition in scale and character along University Avenue. The building's modern design blends and transitions with the surrounding buildings through similar materials and horizontal rooflines. The building reinforces the pedestrian character of University Avenue as required by Policy L-23 and Policy L-24 because it provides a widened sidewalk for pedestrians with sheltered entrances. These same pedestrian features are extended to Kipling Street as well, and the seating area at the rear of the building activates a pedestrian space in the alley. Conditions of Approval Nos. 2b, 2c, 2d, and 2e all reduce the massing and visual prominence of the building along Kipling Street, creating the appearance of a three-story structure. This design provides a smoother transition from the single and two-story structures along Kipling Street. The proposed project incorporates similar pedestrian and human friendly features found in other buildings along University Avenue. The first floor plate height reflects the plate height of the buildings to the west along University Avenue. The surrounding buildings contain sidewalk dining areas, recessed entries, and are predominantly two-story structures, with a low first floor plate height to relate to a human and pedestrian scale. The project incorporates similar features with designated pedestrian areas at the entryways and natural building overhangs along University Avenue and Kipling Street. These design features create a project that is pedestrian friendly and designed at a human scale on elevations fronting rights -of -way. Condition of Approval No. 2e requires that the elevator tower height not exceed 54.5 feet and Condition of Approval No. 2b requires the fourth floor guardrails to be setback from the edge of the terrace along all streetscapes. These conditions reduce the visual prominence of the structure along Kipling Street, and they create the appearance of a three story building. The appearance of a three-story building helps the project achieve an orderly and harmonious design along Kipling Street, which has lower profile buildings. Compatibility and Character: DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F Finding #2: The design is compatible with the immediate environment of the site. Finding #4: This finding of compatibility with unified or historic character is not applicable to the project (there is no unified design or historic character). Finding #5: The design promotes harmonious transitions in scale and character in areas between different designated land uses. Finding #6: The design is compatible with approved improvements both on and off the site. The project is consistent with Findings #2, #4, #5 and #6 because: The project is compatible with the immediate environment of the site. Buildings located to the southwest of the site along University Avenue consist of two-story buildings. The first two floors of the project are consistent with the height of these buildings, while the third floor is setback approximately eight -feet. The fourth floor is setback approximately 40 -feet. These features result in a gradual transition in scale thereby increasing the compatibility and character of the project with its immediate environment. Further, the design obscures the fourth floor from views along University Avenue. The setbacks along Kipling Street and Lane 30 also promote a design that is compatible with the immediate environment of the site and offer harmonious transitions. The setbacks on the fourth floor along Kipling Street obscure views of the building features above the third floor from many vantage points, thereby reducing the building scale and improving compatibility with smaller structures nearby. To accomplish this result, the conditions of approval require that the elevator tower height be reduced to a maximum of 54.5 feet and the elevator shaft is setback 11 feet from Kipling Street, while the stairs and office are setback approximately 20 feet and 37 feet, respectively. This condition and these design features will obscure views of the fourth floor and result in a building with a three-story appearance from vantage points that are close to the site on Kipling Street. This results in a harmonious transition from the two story structures along Kipling Street to the proposed project because it effectively only increases the height of the project by one story from the structure at the corner of Kipling and University and two stories from the business at Kipling Street and Lane 30. Conditions of approval for the project also ensure that the design of the building will be compatible with the immediate environment of the site. Conditions No. 3b and 3c require that the applicant return to the ARB for approval of the materials, colors, craftsmanship and landscaping, and Condition No. 3a requires a decorative wall treatment, feature or element along the southern elevation of the building. These requirements will ensure that design features are compatible with the immediate environment of the site. The design of the building offers a harmoniously compatible transition with the design character of the streetscape along University Avenue. The design of the project transitions from the mid-century designs found along University Avenue to a more modern looking building that defines the street corner. The project consists of rectilinear features in a glass and concrete style building. These features are consistent with the character of the surrounding buildings to the east of the site along University Avenue and the building located at the corner of Kipling Street and University Avenue. The Historic Resources Memorandum notes that the historic character of the area has been compromised by intrusions including incompatible materials, height, massing and architectural features. features. Because the area has not been recognized as having a unified design or historic character, this finding is not applicable. Functionality and Open Space: Finding #3: The design is appropriate to the function of the project. Finding #7: The planning and siting of the building on the site creates an internal sense of order and provides a desirable environment for occupants, visitors and the general community. Finding #8: The amount and arrangement of open space are appropriate to the design and the function of the DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F structures. The project is consistent with Findings #3, #7, and #8 because: The design and arrangement of the open space is appropriate for the function of the project. The project proposes a seating area off the alley at the back of the project. The Comprehensive Plan encourages these spaces such as these to activate alley spaces for pedestrian use. Further, the project incorporates terraced areas around the third floor for the residential users and on the fourth floor for the office use. These areas serve as a functional open space for residents and tenants of the project and are easily accessible to the building users. Therefore, the design, amount, arrangement and planning of open space is appropriate and creates a sense of order for the project. The planning and siting of the building on the site creates a sense of order and provides a desirable environment for visitors, occupants and the general community. The siting of the building is located along the back of the sidewalk, consistent with other buildings along University Avenue streetscape and forms an edge along Kipling Street consistent with the existing buildings along both streets. Vehicle access to the building from the alley provides convenient and safe accessibility that minimizes vehicle interactions along Kipling Street and University Avenue. Internally, stairs and elevators provide access to each floor, and these are conveniently reached from the street or the subterranean parking. The floorplans create individualized floors that separates the residents and commercial and office tenants. Occupants, visitors and the community are provided with a desirable environment because of this ease of access to the individualized uses on each floor. Therefore, the siting and floor plan create a sense of order and provide a desirable environment for occupants, visitors and the general public. Circulation and Traffic: Finding #9: Sufficient ancillary functions are provided to support the main functions of the project and the same are compatible with the project's design concept. Finding #10: Access to the property and circulation thereon are safe and convenient for pedestrians, cyclists and vehicles. The project is consistent with Findings #9 and #10 because: The project contains sufficient ancillary functions to support the main functions. Access to the property and circulation thereon is convenient for cyclists because it provides long-term and short-term bicycle parking. The short term parking is easily accessible from the street and the long term parking is located in the garage where it is screened from public view. Access to the property and circulation thereon are safe and convenient for all users. The alley provides a dedicated, separate access point to the project from the street. This will minimize vehicle interactions with other vehicles as well as pedestrians and cyclists. Further, the traffic study has determined that there is adequate site distance for exiting the alley onto Kipling Street. The project will incorporate mirrored installations at the parking garage ingress and egress to improve visibility and reduce conflicts between vehicles and pedestrians and cyclists. The onsite circulation was reviewed in accordance with generally accepted traffic engineering standards. Generally, the proposed plan would provide one main drive aisle that would lead to an underground parking structure. Parking is shown at 90 degrees to the main drive aisle. This drive aisle makes several 90 degree turns to spiral down to the farthest parking spaces. The City parking facility design standards specify a minimum width of 16 feet for two-way underground ramps; 25 feet for two-way drive aisles lined with 8.5 foot wide, 90 degree spaces; and maximum slope of 2% adjacent to accessible parking spaces. The proposed project DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F meets these standards. Further, the project was also found to meet the applicable parking requirements of the PAMC. Therefore, these features ensure access and circulation thereon are safe and convenient for all users. The project is subject to the loading area requirements in the City's Zoning Code because it is a mixed -use project with commercial, office and residential uses. Consistent with past practice, the staff has recommended approval of an off -site loading area near the building rather than on the project site itself. There is a loading zone at Kipling Street and the alley provides sufficient loading space for the project and service alleys throughout downtown have historically been used for the purpose of shared loading and access. Using the alley is consistent with prior projects reviewed by the City and with previous iterations of the project design, and meets the intent of the City's Code requirement. Landscaping and Plant Materials: Finding #11: Natural features are appropriately preserved and integrated with the project. Finding #12: The materials, textures and colors and details of construction and plant material are an appropriate expression to the design and function and compatible with the adjacent and neighboring structures, landscape elements and functions. Finding #13: The landscape design concept for the site, as shown by the relationship of plant masses, open space, scale, plant forms and foliage textures and colors create a desirable and functional environment on the site and the landscape concept depicts an appropriate unit with the various buildings on the site. Finding #14: Plant material is suitable and adaptable to the site, capable of being properly maintained on the site, and is of a variety that would tend to be drought -resistant and to reduce consumption of water in its installation and maintenance. The project is consistent with Findings #11- #14 because: The project will preserve existing street trees along University Avenue and will replace two perimeter trees along Kipling Street with ginkgo biloba. Two other street trees along Kipling Street will be retained. The project proposes appropriate, drought tolerant, sustainable landscaping in key open space areas that will complement and enhance the design of these spaces. The landscaping will form a soft edge and perimeter around the ground floor and terrace area on the third floor. Further, as conditioned, the project is required to return to the Architectural Review Board for review and recommendation to the Director of Planning and Community Environment for landscape details and plans for all proposed planting, including individual planters, the greenwall, and landscaping near the rooftop elevator. Therefore, the landscape design is appropriate and compatible for the project. The proposed project is consistent with the above finding because it corporates materials, textures, colors and details that are compatible with adjacent structures and functions. Adjacent structures employ brick, stucco and glass windows with a rough texture and organic colors. The proposed structure consists of concrete, glass windows, and metal mesh screens. These features compliment the adjacent buildings and the third and fourth floor consist of a similarly colored concrete as nearby buildings. Further, as conditioned, the project is required to return to the Architectural Review Board for review and recommendation to the Director of Planning and Community Environment of exterior building materials, colors and craftsmanship -related detailing associated with the project. Therefore, the project is compatible with the materials, colors and textures of adjacent buildings. Sustainability: Finding #15: The design is energy efficient and incorporates renewable energy design elements including, but not limited to: DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F • Careful building orientation to optimize daylight to interiors • High performance, low -emissivity glazing • Cool roof and roof insulation beyond Code minimum • Solar ready roof • Use of energy efficient LED lighting • Low -flow plumbing and shower fixtures • Below grade parking to allow for increased landscape and stormwater treatment areas The project is consistent with Finding #15 because: In accordance with the City's Green Building Regulations, the building will satisfy the requirements for CALGreen Mandatory + Tier 2. SECTION 4. Architectural Review Findings. Revised Architectural Review Findings were adopted by ordinance of the City Council on November 14, 2016 (second reading December 12, 2016) and became effective on January 12, 2017. The Council finds that the project as modified is consistent with these findings and the Context - Based Design Criteria in PAMC 18.18.110 as follows: Finding #1: The design is consistent with applicable provisions of the Palo Alto Comprehensive Plan, Zoning Code, coordinated area plans (including compatibility requirements), and any relevant design guides. The proposed project, as modified by the conditions of approval, is generally consistent with the Palo Alto Comprehensive Plan, including the following goals and policies: • Goal 1-1: A well -designed, compact city, providing residents and visitors with attractive neighborhoods, work places, shopping district, public facilities and open spaces. • Policy L-5: Maintain the scale and character of the City. Avoid land uses that are overwhelming and unacceptable due their size and scale. • Goal L-4: Inviting, pedestrian -scale centers that offer a variety of retail and commercial services and provide focal points and community gathering places for the City's residential neighborhoods and Employment Districts. • Policy L-20: Encourage street frontages that contribute to retail vitality in all Centers. Reinforce street corners with buildings that come up to the sidewalk or that form corner plazas. • Policy L-23: Maintain and enhance the University Avenue/Downtown area as the central business district of the City, with a mix of commercial, civic, cultural, recreational and residential uses. Promote quality design that recognizes the regional and historical importance of the area and reinforces its pedestrian character. • Policy L-24: Ensure that University Avenue/Downtown is pedestrian -friendly and supports bicycle use. Use public art and other amenities to create an environment that is inviting to pedestrians. • Goal L-6: Well -designed buildings that create coherent development patterns and enhance city streets and public spaces. • Policy L-48: Promote high quality, creative design and site planning that is compatible with surrounding development and public spaces. • Policy L-49: Design buildings to revitalize streets and public spaces and to enhance a sense of community and personal safety. Provide an ordered variety of entries, porches, windows, bays and balconies along public ways where it is consistent with neighborhood character; avoid blank or solid walls at street level; and include human -scale details and massing. • Goal T-3: Facilities, services and programs that encourage and promote walking and bicycling. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F • Policy T-21: Support the use of Downtown alleyways for pedestrian- and bicycle -only use. • Policy T-23: Encourage pedestrian -friendly design features such as sidewalks, street trees, on -site parking, public spaces, gardens, outdoor furniture, art, and interesting architectural details. More specifically, the project is consistent with Policy L-5, which seeks to maintain the scale and character of the City. Avoid land uses that are overwhelming and unacceptable due their size and scale. As conditioned, the approved project reduces the scale and visual prominence of the building along University Avenue and Kipling Street, creating the appearance of a three-story structure. This design provides a smoother transition from the single and two-story structures along University Avenue and Kipling Street, thereby maintaining the scale of the blocks. The building's modern design blends and transitions with the surrounding buildings and other buildings in the City through use of similar materials, design features, massing, and character. The project is further consistent with Goals L-4 and Policies L-20, L-23 and L-24 and L-49, in that the project provides ground floor commercial space at a prominent intersection that serves as a focal point for a variety of retail uses that could occupy the space. The rhythmic position of the doors along University Avenue and Kipling Street also enhance retail vitality of the streets by locating retail uses immediately adjacent to the sidewalk and reflects the pattern of development along University Avenue. The project is consistent with Policy L-23 as it provides a mixture of commercial, office and residential uses comprised in a quality designed building. The project is consistent with Policies L-24, L-49, T-21 and T-23 because it provides a widened sidewalk for pedestrians with sheltered entrances. These same pedestrian features are extended to Kipling Street as well, and the seating area at the rear of the building activates a pedestrian space in the alley. The project is consistent with Goal L-6 and Policies L-48 and L-49 because the project is well designed, creates a coherent development pattern, is of high quality, and creative design that is compatible with surrounding development. Conditions of Approval Nos. 2b, 2c, 2d, 3b, 3c ensure that materials, landscaping and colors will be of high quality; reduce the massing and scale of the building to make it compatible with the surrounding buildings by limiting the elevator tower height, removing the library from the third floor, and reducing the projection of the eyebrow on the building; and setting back the guardrails and planters on the fourth floor to further reduce the massing and scale and enhance the buildings compatibility with the surrounding environment. The project has also been reviewed to the objective development standards in the zoning code and found to be in compliance with the intent and regulations contained therein. A comprehensive review of the project to applicable development standards is included in the administrative record. The project is consistent with the Downtown Urban Design plan. The project is located in the Commercial Core and more specifically the University Avenue District. The Urban Design plan notes that the alley from Kipling Street is designated for opportunities for pedestrian friendly use. The project satisfies this design requirement by providing a courtyard area with tables for pedestrians to use at the rear of the project site. The alley fagade also incorporates a green wall which provides a sense of life to the alleyway. Other relevant goals in the plan include reinforcing University Avenue as the retail core by maintaining ground floor retail space, develop and enhance the qualities of University Avenue which make it an exciting outdoor and pedestrian environment with eclectic architecture, outdoor food, and entertainment and public amenities. The project maintains commercial uses along University Avenue by designating the ground floor area of the building for commercial spaces. The design of the project generates interests on the side streets. The clear glass windows allow pedestrians to see through the corner of the building which strengthens the pedestrian experience. The project provides pedestrian spaces through the recessed entries and widened sidewalk. The building is designed with attention to all facades. Kipling Street and University Avenue have the same attention to detail as the alley and southern elevation. The attention to detail in the alley is exhibited through the use of a green wall planter. Further, as conditioned, the southern elevation is required to incorporate a decorative wall treatment, feature or element. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F Therefore, the project is conditioned and incorporates attention to detail on each facade. The ground floor of the project is primarily comprised of glass which is consistent with the plan's requirement for ground floor treatments that allow for easier pedestrian views of displays and merchandise. Further, the project is located in the Kipling Street secondary district. The plan calls for Kipling Street between Lytton and University Avenue to retain older single family structures and the architectural character they provide. The project is not subject to this requirement because it does not propose to convert a single-family structure, and therefore its architecture, on Kipling Street. The project would convert commercial structures. The plan also calls for the terminus of Kipling Street and University Avenue to be enhanced through tie-ins to the Varsity Theater. The project would tie-in to the Varsity Theater by providing a structure that is of similar height and massing, located at the street front. The project is not subject to any coordinated area plans. Finding #2: The project has a unified and coherent design, that: a. creates an internal sense of order and desirable environment for occupants, visitors, and the general community, b. preserves, respects and integrates existing natural features that contribute positively to the site and the historic character including historic resources of the area when relevant, c. is consistent with the context -based design criteria of the applicable zone district, d. provides harmonious transitions in scale, mass and character to adjacent land uses and land use designations, e. enhances living conditions on the site (if it includes residential uses) and in adjacent residential areas. The project is consistent with Finding #2 because: The project has a unified and coherent design and creates an internal sense of order in that each use of the building is separated onto a specific floor. Each use also has access to own open space and the floor plans facilitate the proposed uses through appropriate layouts and configurations of the internal spaces. Internal spaces are provided with direct access and circulation routes and amenities like kitchen spaces for the commercial and office uses. The project is designed to preserve, respect and integrate natural features. Natural features for this project consist of street trees along University Avenue and Kipling Street. The project site will preserve the existing street trees along University Avenue and will replace the ginkgo biloba trees along Kipling Street with new gingko biloba trees. The building respect the street trees by maintain setbacks from the vegetation and Condition of Approval No. 3b ensures that vegetation from the project will integrate with the street trees. Because the area has not been recognized as having a unified design or historic character, the finding for historic character is not applicable Therefore, the project will preserve, respect and integrate natural features that contribute positively to the site. The project is consistent with the context -based design criteria for the applicable zone district: The design and architecture of the proposed project has been reviewed with respect to the Context -Based Design Criteria set forth in PAM 18.18.110. Section 18.18.110 notes that the project shall be: • Responsible to its context and compatible with adjacent development, and shall promote the establishment of pedestrian oriented design (where "responsible to context" is not a desire to replicate surroundings, but provide appropriate transitions to surroundings), and DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F • Compatible with adjacent development, when apparent scale and mass is consistent with the pattern of achieving a pedestrian oriented design and when new construction shares general characteristics and establishes design linkages with the overall pattern of buildings so the visual unit of the street is maintained. Pursuant to PAMC 18.18.110(b), the following additional findings have been made in the affirmative: (1) Pedestrian and Bicycle Environment: The design of new projects shall promote pedestrian walkability, a bicycle friendly environment, and connectivity through design elements. This finding can be made in the affirmative in that the project supports widen sidewalk with recessed entries on primary pedestrian routes, at -grade bicycle racks near the building entrances, secured bicycle facility at ground level and within the underground parking garage. (2) Street Building Facades. Street facades shall be designed to provide a strong relationship with the sidewalk and the street(s), to create an environment that supports and encourages pedestrian activity through design elements. This finding can be made in the affirmative in that the proposed street facades are designed to create an environment that supports and encourages pedestrian activity. The building facade facing University Avenue preserves the existing storefront pattern with distinguish architectural elements to break up building mass. Entries are clearly defined and have a scale that is in proportion to the building functions. Elements that signal habitation such as entrances, stairs, and balconies are visible to people on the street. Proposed placement and orientation of doorways, windows and landscape elements are appropriate to create strong and direct relationships with the streets. Upper floors are setback, width of overhang is reduced and elevator shaft is oriented inward to reduce building mass and to fit in with the context of the neighborhood; (3) Massing and Setbacks. Buildings shall be designed to minimize massing and conform to proper setbacks. This finding can be made in the affirmative in that the project incorporates design with a series of recessed terraces and interchange in materials to break down the scale of building and provide visual interest. Variation in massing and materials create a facade with two distinctive frontages, which respect the existing storefront patterns and rhythms on University Avenue. Proposed design incorporates columns framework and tall display windows to reinforce the street corner. With the intent to minimize massing and ensure greater setback, proposed design has reduced the height of stairway tower and setback roofline for upper floor terrace at the corner of Lane 30 and Kipling Street; (4) Low -Density Residential Transitions. Where new projects are built abutting existing lower scale residential development, care shall be taken to respect the scale and privacy of neighboring properties. Although the parcels abutting the project site along Kipling Street have a commercial zoning designation, most of the built forms have a low density residential appearance. While the height is taller than most of the buildings in the neighborhood, the proposed building height of 50 feet is compliant with the height limit in the Downtown Commercial District. Proposed design includes at least a 10 feet setback with open terraces at the second and third floors to reduce the impact of the building height on to adjacent lower density neighborhood. Potential privacy concern is at a less than significant level as the buildings behind the project site are mostly one-story with commercial/office uses and mature trees along Kipling Street would provide some degree of screening. Proposed design includes storefront glass on both frontages to introduce a daylight source on the ground level. (5) Project Open Space. Private and public open space shall be provided so that it is usable for residents, visitors, and/or employees of the site. This finding can be made in the affirmative in that the project provides open DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F space with wider sidewalks, balconies, and a roof -top terrace. The balconies are accessible by residents on the site and are located on four sides of the building that encourage 'eyes on the street'. Proposed roof -top terrace is for office tenants and would provide ample solar exposure; (6) Parking Design. Parking needs shall be accommodated but shall not be allowed to overwhelm the character of the project or detract from the pedestrian environment. This finding can be made in the affirmative in that the project's parking is located within the below -grade garage and does not detract from pedestrian environment. The project includes a well -integrated garage entry, four feet setback, and mirrors that aid traffic and improve visibility on Lane 30. In addition, the project incorporates landscaping element to soften the exit of Lane 30. The intent is to enhance the character of pedestrian environment, while maintaining traffic visibility with low profile plant materials; (7) Large (Multi -Acre) Sites. Large sites (over one acre) shall be designed so that street, block, and building patterns are consistent with those of the surrounding neighborhood. This finding does not apply; (8) Sustainability and Green Building Design. Project design and materials to achieve sustainability and green building design should be incorporated into the project. This finding can be made in the affirmative in that the project would comply with the City's green building ordinance, and the design includes overhangs, recesses, and other shading devices and techniques to reduce the solar heat gain and energy consumption related to the cooling of the building. Design is easy for pedestrian, bicycle and transit access. The project incorporates high efficiency LED light fixtures, low -flow plumbing fixtures and high efficiency HVAC equipment for efficiency energy and water use. Green building features will be incorporated to achieve CalGreen Tier 2 standards for the commercial portion and Green Point rated standards for the residential portion. Condition of Approval No. 2e requires that the elevator tower height not exceed 54.5 feet and Condition of Approval No. 2b requires the fourth floor guard rails to be setback from the edge of the terrace along all streetscapes. These conditions reduce the visual prominence of the structure along Kipling Street, and they create the appearance of a three story building. Along Kipling Street and University Avenue, the project would constitute a one to two-story increase in height from the adjacent structures. Additionally, the second and third floors are setback 10 -feet from the alley way, and the third floor is setback approximately seven -feet off of Kipling Street and University Avenue. Condition Nos. 2c and 2d requires the library to be removed from the third floor at the intersection of Kipling Street and University Avenue and for the third floor roofline to follow the fourth floor plan, which further reduces the mass and scale of the building. These conditions and design feature help the project achieve a harmonious transition in scale and mass between adjacent land uses along Kipling Street and University Avenue. Further, the project is consistent with Finding #2 because it enhances the living conditions on the site by providing residential units in downtown. The project enhances the adjacent residential areas because it provides space for employment and commerce that residences can access easily from surrounding areas. Finding #3: The design is of high aesthetic quality, using high quality, integrated materials and appropriate construction techniques, and incorporating textures, colors, and other details that are compatible with and enhance the surrounding area. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F The project is consistent with Finding #3 because: The project has a high aesthetic quality, materials, construction techniques, textures, colors and other details that are compatible with and enhance the surrounding area. The buildings surrounding the site are comprised of concrete, stone, glass, brick, and metal and range in height from two to four stories along University Avenue. Along Kipling Street, buildings consist of cement, stucco, glass and brick structures. The proposed structure is comprised of high quality glass, concrete and steel design which is similar and representative of the materials found in the surrounding environment. Further, the materials, textures, and attention to detail in the structure is consistent throughout each elevation which represents a high quality aesthetic design. Lastly, the project, will have high quality materials, textures, colors and finishes because it is conditioned to return to the Architectural Review Board for review and recommendation to the Director of Planning and Community Environment of exterior building materials, colors and craftsmanship -related detailing associated with the project. Therefore, the project is consistent with Finding #3 because it consists of a high quality aesthetic design with integrated materials, textures, colors and other details that are compatible with the surrounding environment. Finding #4: The design is functional, allowing for ease and safety of pedestrian and bicycle traffic and providing for elements that support the building's necessary operations (e.g. convenient vehicle access to property and utilities, appropriate arrangement and amount of open space and integrated signage, if applicable, etc.). The project is consistent with Finding #4 because: Access to the property and circulation thereon are safe and convenient for all users. The alley provides a dedicated, separate access point to the project from the street. This will minimize vehicle interactions with other vehicles as well as pedestrians and cyclists. Further, the traffic study has determined that there is adequate site distance for exiting the alley onto Kipling Street. The project will incorporate mirrored installations at the parking garage ingress and egress to improve visibility and reduce conflicts between vehicles and pedestrians and cyclists. The onsite circulation was reviewed in accordance with generally accepted traffic engineering standards. Generally, the proposed plan would provide one main drive aisle that would lead to an underground parking structure. Parking is shown at 90 degrees to the main drive aisle. This drive aisle makes several 90 degree turns to spiral down to the farthest parking spaces. The City parking facility design standards specify a minimum width of 16 feet for two-way underground ramps; 25 feet for two-way drive aisles lined with 8.5 foot wide, 90 degree spaces; and maximum slope of 2% adjacent to accessible parking spaces. The proposed project meets these standards. Further, the project was also found to meet the applicable parking requirements of the PAMC. Therefore, these features ensure access and circulation thereon are safe and convenient for all users. Finding #5: The landscape design complements and enhances the building design and its surroundings, is appropriate to the site's functions, and utilizes to the extent practical, regional indigenous drought resistant plant material capable of providing desirable habitat that can be appropriately maintained. The project is consistent with Finding #5 because: The project will preserve existing street trees along University Avenue and will replace two perimeter trees along Kipling Street with ginkgo biloba. Two other street trees along Kipling Street will be retained. The project proposes appropriate, drought tolerant, sustainable landscaping in key open space areas that will complement and enhance the design of these spaces. The landscaping will form a soft edge and perimeter around the ground floor and terrace area on the third floor. Further, as conditioned, the project is required to return to the Architectural Review Board for review and recommendation to the Director of Planning and Community DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F Environment for landscape details and plans for all proposed planting, including individual planters, the greenwall, and landscaping near the rooftop elevator. Therefore, the landscape design is appropriate and compatible for the project. Finding #6: The project incorporates design principles that achieve sustainability in areas related to energy efficiency, water conservation, building materials, landscaping, and site planning. The project is consistent with Finding #6 because: In accordance with the City's Green Building Regulations, the building will satisfy the requirements for CALGreen Mandatory + Tier 2. SECTION 7. Conditions of Approval. The following conditions of approval shall be implemented as part of the modified project approved by this Record of Land Use Action. Condition numbers 2 and 3 are those specifically adopted by the City Council to ensure that the modified project is consistent with all applicable findings. Planning Division 1. SUBSTANTIAL CONFORMANCE. The plans submitted for a Building Permit shall be in substantial conformance with plans received on October 26, 2016, hereby labeled as Option 1, containing 24 pages, except as modified to incorporate the following conditions of approval. 2. BUILDING PERMIT PLAN SET. A copy of this cover letter and conditions of approval, including Exhibit A (MMRP), shall be printed on the second page of the plans submitted for building permit. Project plans submitted for Building permits shall incorporate the following changes, to the satisfaction of the Director of Planning and Community Environment: a. Applicant shall submit detailed plans that demonstrate compliance with floor area and other applicable development standards. b. The fourth floor guardrails and planters shall be set back a minimum of five feet from the edge of the third floor roofline (all elevations), as modified by these conditions. c. The 'library' shown on the third floor, floor plans, at the street corner, shall be removed. d. The third floor roofline above the removed 'library' area shall be removed, except to allow a three-foot overhang. e. The elevator adjacent to Kipling Street, inclusive of any associated mechanical equipment, shall not exceed fifty-four and one-half feet (54.5') in height. 3. BOARD LEVEL ARCHITECTURAL REVIEW: Prior to the issuance of building permits, the applicant shall return to the ARB for approval of the following items, to the satisfaction of the Director of Planning and Community Environment: a. A decorative wall design treatment, feature or element, shall be applied to the exterior walls immediately adjacent to the southern property line (project's south elevation) starting at an DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F elevation equivalent to the building height of the adjacent structure and extending to the roofline of the proposed building. b. Landscape details and plans for all proposed planting, including individual planters, the greenwall, and landscaping near the rooftop elevator. c. The exterior building materials, colors and craftsmanship -related detailing associated with the project. 4. Prior to issuance of a building permit, the project applicant shall demonstrate how interior and exterior lighting sources will be reduced after operating hours or when the use of the facility is reduced. This may require the use of timing devices for exterior and interior lights in order to minimize light glare at night without jeopardizing security of employees/residents. 5. PROJECT MODIFICATIONS: All modifications to the approved project shall be submitted for review and approval prior to construction. If during the Building Permit review and construction phase, the project is modified by the applicant, it is the responsibility of the applicant to contact the Planning Division/project planner directly to obtain approval of the project modification. It is the applicant's responsibility to highlight any proposed changes to the project and to bring it to the project planner's attention. 6. DEVELOPMENT IMPACT FEES: Estimated Development Impact Fees in the amount of $312,634.85 plus the applicable public art fee, per PAMC 16.61.040, shall be paid prior to the issuance of the related building permit. 7. REQUIRED PUBLIC ART. In conformance with Ordinance No. 5226, and to the satisfaction of the Public Art Commission, the property owner and/or applicant shall select an artist and received final approval of the art plan , or pay the in -lieu fee equivalent to 1% of the estimated construction valuation, prior to issuance of a Building permit. All required artwork shall be installed as approved by the Public Art Commission and verified by Public Art staff prior to release of the final Use and Occupancy permit. The Public Art requirements Application information and documents can be found at www.cityofpaloalto.org/publicart under the "policies and documents" tab. 8. IMPACT FEE 90 -DAY PROTEST PERIOD. California Government Code Section 66020 provides that a project applicant who desires to protest the fees, dedications, reservations, or other exactions imposed on a development project must initiate the protest at the time the development project is approved or conditionally approved or within ninety (90) days after the date that fees, dedications, reservations or exactions are imposed on the Project. Additionally, procedural requirements for protesting these development fees, dedications, reservations and exactions are set forth in Government Code Section 66020. IF YOU FAIL TO INITIATE A PROTEST WITHIN THE 90 -DAY PERIOD OR FOLLOW THE PROTEST PROCEDURES DESCRIBED IN GOVERNMENT CODE SECTION 66020, YOU WILL BE BARRED FROM CHALLENGING THE VALIDITY OR REASONABLENESS OF THE FEES, DEDICATIONS, RESERVATIONS, AND EXACTIONS. If these requirements constitute fees, taxes, assessments, dedications, reservations, or other exactions as specified in Government Code Sections 66020(a) or 66021, this is to provide notification that, as of the date of this notice, the 90 -day period has begun in which you may protest these requirements. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 9. INDEMNITY. To the extent permitted by law, the Applicant shall indemnify and hold harmless the City, its City Council, its officers, employees and agents (the "indemnified parties") from and against any claim, action, or proceeding brought by a third party against the indemnified parties and the applicant to attack, set aside or void, any permit or approval authorized hereby for the Project, including (without limitation) reimbursing the City for its actual attorneys' fees and costs incurred in defense of the litigation. The City may, in its sole discretion, elect to defend any such action with attorneys of its own choice. 10. MITIGATION MONITORING REPORTING PROGRAM (MMRP). The MMRP associated with the project and attached here as Exhibit A is incorporated by reference and all mitigation measures shall be implemented as described in said document. 11. PLANNING FINAL INSPECTION. A Planning Division Final inspection will be required to determine substantial compliance with the approved plans prior to the scheduling of a Building Division final. Any revisions during the building process must be approved by Planning, including but not limited to; materials, fenestration and hard surface locations. Contact your Project Planner at 650-329-2441 x0 to schedule this inspection. 12. EXPIRATION. The project approval shall be valid for a period of one year from the original date of approval. In the event a building permit(s) is not secured for the project within the time limit specified above, the ARB approval shall expire and be of no further force or effect. Application for extension of this entitlement may be made prior to the one year expiration. Building Division 13. The permit application shall be accompanied by all plans and related documents necessary to construct the complete project. 14. A demolition permit shall be required for the removal of the existing building(s) on site. 15. The entire project is to be included under a single building permit and shall not be phased under multiple permits. 16. Separate submittals and permits are required for the following systems: E.V., P.V. and Solar Hot Water. 17. Design of building components that are not included in the plans submitted for building permit and are to be "deferred" shall be limited to as few items as possible. The list of deferred items shall be reviewed and approved prior to permit application. 18. The plans submitted for the building permit shall include an allowable floor area calculation that relates the mixed occupancies to type of construction. 19. The plans submitted for the building permit shall include allowable floor area calculations that relate the proposed occupancies to type of construction. This includes possible future installation of assembly occupancies such as large conference rooms or cafeterias, for example. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 20. An acoustical analysis shall be submitted and the plans shall incorporate the report's recommendations needed to comply with the sound transmissions requirements in CBC Section 1207. Green Building 21. Green Building Ordinance: a. Commercial Portion - CALGreen Tier 2: The project must meet the California Green Building Code Tier 2 requirements. Due to the size of the project, the team must engage a commissioning agent and fulfil on the commissioning requirements. Additional information may be found at the following link http://www.cityofpaloalto.org/gov/depts/ds/green_building/default.asp. The new Energy California Energy Code contains significant changes and Palo Alto is currently enforcing code minimum for the energy code. The details can be found at the following link. http://www.energy.ca.gov/title24/2013standards/ b. Residential Portion- Green Point Rated: The project is required to achieve Green Point Rated Certification through Build It Green. The project team must engage a Green Point Rater. The required minimum points value is 70. The required prerequisite and points associated with exceeding the code shall be excused. Additional information may be found at the following 1 inkhttp://www.cityofpaloalto.org/gov/depts/ds/green_bui lding/default.asp 22. EV Parking Ordinance: The project is subject to meet the new Electric Vehicle Parking Ordinance that requires but is not limited to: a. Multi -family: One EVSE Ready or EVSE Installed per unit. For guest parking, either conduit only, EVSE Ready or EVSE Installed shall be provided for 25% of the parking. A minimum of 1 EVSE Installed for multi -family guest parking shall be provided. b. Commercial: For commercial parking, either conduit only, EVSE Ready or EVSE Installed shall be provided for 25% of the parking. A minimum of 1 EVSE Installed for commercial parking shall be provided. Urban Forestry 23. STREET TREES: City street trees approved to remain shall be maintained and protected during construction per City of Palo Alto standard requirements as further described in the City's Tree Technical Manual and below: a. UNIVERSITY AVENUE: Two regulated street trees (London Plane) on University Ave frontage are to be retained and protected. Protection shall consist of Modified Type I II for the entire trunk and will include primary branches on the building side. Prior to any clearance/pruning, the project applicant shall: i. Submit a written Tree Care Application to Dorothy.dale@cityofpaloalto.org, ii. Receive approval of said Tree Care Application, and iii. Shall coordinate with Urban Forestry for direct supervision by staff of private tree contractor. b. KIPLING STREET: Four trees in the right of way are approved for removal. Four replacement trees shall be installed, Ginkgo biloba 'Autumn Gold', Maidenhair, 36 -inch box size, in 5'x5' Kiva tree grates, two irrigation bubblers per tree (PW Standard Detail # 603a and 513). A certified arborist for the applicant shall evaluate/select matching trees DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F for quality. Contractor shall coordinate an Urban Forestry inspection of the new trees, before they are planted in the ground. i. SIDEWALK BASE MEDIUM: As a root growing medium between the curb and building face, Silva Cell technology or approved equal, shall be designed as a suspended sidewalk element and provide low compaction area for long term root growth. A certified arborist for the applicant shall calculate how many cubic feet of soil and Silva cell material will be needed for each tree, for approval by the Urban Forester. 24. All landscape material shall be well maintained for the life of the project and replaced if it fails. Public Works Engineering Department PRIOR TO BUILDING PERMIT AND GRADING AND EXCAVATION PERMIT SUBMITTAL: 25. CERTIFICATE OF COMPLIANCE: The applicant has revised the project description to indicate that she is no longer pursuing the development of condominiums. Since the project site is located within two parcels 120-15-029 and 120-15-028 a certificate of compliance for a lot merger is required. Applicant shall apply for a certificate of compliance and provide the necessary documents. Certificate of Compliance shall be recorded prior to issuance of a building or grading and excavation permit. PRIOR TO ISSUANCE OF A DEMOLITION PERMIT: 26. LOGISTICS PLAN: The applicant and contractor shall submit a construction logistics plan to the Public Works Department that addresses all impacts to the City's right-of-way, including, but not limited to: construction fence, construction entrance, stockpile areas, office trailer, temporary bathroom, measures for dewatering if needed, pedestrian control, traffic control, truck routes, material deliveries, contractor's parking, on -site staging and storage areas, concrete pours, crane lifts, work hours, noise control, dust control, storm water pollution prevention, contractor's contact. The plan shall be prepared and submitted along the Rough Grading and Excavation Permit. It shall include notes as indicated on the approved Truck Route Map for construction traffic to and from the site. Plan shall also indicate if the bus stop will need to be relocated. 27. Applicant shall schedule a meeting with Public Works Engineering and Transportation Division to discuss the existing building demolition, excavation and building construction logistics. Construction fence shall be located at the building property line, travel lane closures will not be permitted. Applicant shall propose a logistics plan that shows how pedestrian access is maintained and eliminating the least number of parking spaces during construction. PRIOR TO ISSUANCE OF EXCAVATION AND GRADING PERMIT: 28. GRADING PERMIT: An Excavation and Grading Permit is required for grading activities on private property that fill, excavate, store or dispose of 100 cubic yards or more based on PAMC Section 16.28.060. Applicant shall prepare and submit an excavation and grading permit to Public Works separately from the building permit set. The permit application and instructions are available at the Development Center and on our website: http://www. cityofpa loa lto.org/gov/de pts/pwd/forms_a nd_perm its.asp DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 29. ROUGH GRADING: provide a Rough Grading Plan for the work proposed as part of the Grading and Excavation Permit application. The Rough Grading Plans shall including the following: pad elevation, basement elevation, elevator pit elevation, ground monitoring wells, shoring for the proposed basement, limits of over excavation, stockpile area of material, overall earthwork volumes (cut and fill), temporary shoring for any existing facilities, ramps for the basement access, crane locations (if any), etc. Plans submitted for the Grading and Excavation Permit, shall be stand-alone, and therefore the plans shall include any conditions from other divisions that pertain to items encountered during rough grading for example if contaminated groundwater is encountered and dewatering is expected, provide notes on the plans based Water Quality's conditions of approval. Provide a note on the plans to direct the contractor to the approve City of Palo Alto Truck Route Map, which is available on the City's website. 30. BASEMENT SHORING: Provide shoring plans for the basement excavation, clearly including tiebacks (if any). Tieback shall not extend onto adjacent private property or into the City's right-of-way without having first obtained written permission from the private property owners and/or an encroachment permit from Public Works. During the ARB process and via email dated 9/25/14 the applicant indicated that the tiebacks will extend into the adjacent private property. As such provide a letter from the neighboring property owner to allow the encroachment of permanent tiebacks into their property. In addition the shoring plans shall clearly show the property line and the dimension between the outside edge of the soldier piles and the property line for City records. Also provide notes on the Shoring Plans for the "Contractor to cut-off the shoring 6 -feet below the sidewalk elevation." AND "Contractor shall submit and obtain a permanent encroachment permit from Public Works for the tiebacks and shoring located within public right-of-way. 31. DEWATERING: Basement excavation may require dewatering during construction. Public Works only allows groundwater drawdown well dewatering. Open pit groundwater dewatering is not allowed. Dewatering is only allowed from April through October due to inadequate capacity in our storm drain system. The geotechnical report for this site must list the highest anticipated groundwater level. We recommend that a piezometer be installed in the soil boring. The contractor shall determine the depth to groundwater immediately prior to excavation by using a piezometer or by drilling an exploratory hole if the deepest excavation will be within 3 feet of the highest anticipated groundwater level. If groundwater is found within 2 feet of the deepest excavation, a drawdown well dewatering system must be used, or alternatively, the contractor can excavate for the basement and hope not to hit groundwater, but if he does, he must immediately stop all work and install a drawdown well system before he continues to excavate. Based on the determined groundwater depth and season the contractor may be required to dewater the site or stop all grading and excavation work. In addition Public Works may require that all groundwater be tested for contaminants prior to initial discharge and at intervals during dewatering. If testing is required, the contractor must retain an independent testing firm to test the discharge water for contaminants Public Works specifies and submit the results to Public Works. Public Works reviews and approves dewatering plans as part of a Street Work Permit. The applicant can include a dewatering plan in the building permit plan set in order to obtain approval of the plan during the building permit review, but the contractor will still be required to obtain a street work permit prior to dewatering. The street work permit to dewater must be obtained in August to allow ample to time to dewater and complete the dewatering by October 31st. Alternatively, the applicant must include the above dewatering requirements in a note on the site plan. Public Works has a sample dewatering plan sheet and dewatering guidelines available at the Development Center and on our website: DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F http://www. cityofpa loa lto.org/gov/de pts/pwd/forms_a nd_perm its.asp The following links are included to assist the applicant with dewatering requirements: http://www.cityofpaloalto.org/civicax/filebank/documents/30978 http://www.cityofpaloalto.org/civicax/filebank/documents/51366 http://www.cityofpaloalto.org/civicax/filebank/documents/47388. 32. WATER FILLING STATION: Applicant shall install a water station for the non -potable reuse of the dewatering water. This water station shall be constructed within private property, next to the right-of- way, (typically, behind the sidewalk). The station shall be accessible 24 hours a day for the filling of water carrying vehicles (i.e. street sweepers, etc.). The water station may also be used for onsite dust control. Before a discharge permit can be issued, the water supply station shall be installed, ready for operational and inspected by Public Works. The groundwater will also need to be tested for contaminants and chemical properties for the non -potable use. The discharge permit cannot be issued until the test results are received. Additional information regarding the station will be made available on the City's website under Public Works. 33. GROUNDWATER USE PLAN: A Groundwater Use Plan (GWUP) shall be submitted for review for any project which requires dewatering. The GWUP, a narrative that shall be included in or accompany the Dewatering Plan, must demonstrate the highest beneficial use practicable of the pumped groundwater. The GWUP shall also state that all onsite, non -potable water needs such as dust control shall be met by using the pumped groundwater. Delays in submitting the GWUP can result in delays in the issuance of your discharge permit as Public Works requires sufficient review time which shall be expected by the applicant. 34. GEOTECHNICAL REPORT: Shall clearly identify the highest projected groundwater level to be encountered in the area of the proposed basement in the future will be feet below existing grade. Provide a note on the Rough Grading Plan that includes the comment above as a note. 35. GAS METERS: In -ground gas meters are not typically allowed by Public Works Utilities. If in -ground gas meters are not allowed, the above ground gas meter shall be located complete within private property. Plot and label the proposed location. If in -ground gas meters are permitted, applicant shall submit an email from Utilities that indicates in -ground gas meters are acceptable for this project. PRIOR TO ISSUANCE OF A BUILDING PERMIT 36. MAPPING: Applicant has revised the project description to indicate that she is no longer pursuing the development of condominiums. If at any point the applicant intends to sell portions of the building a Minor or Major Subdivision Application will be required. Public Works' Tentative Maps and Preliminary Parcel Maps checklist must accompany the completed application. All existing and proposed dedications and easements must be shown on the submitted map. The map would trigger further requirements from Public Works, see Palo Alto Municipal Code section 21.12 for Preliminary Parcel Map requirements and section 21.16 for Parcel Map requirements. 37. OFFSITE IMPROVEMENT PLANS: Prior to submittal of Building and/or Grading permit applicant shall meet with Public Works to discuss off -site improvements. These may include but are not limited to new concrete or asphalt work, utility upgrades or relocations, and/or street resurfacing. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 38. The following items were not addressed through the final ARB submittal and shall be shown on the plans. a. Explain how all of the site runoff will drain directly into the media filter. The media filter shall be located complete with the private property as shown on the approve ARB plans. The details provided indicate that the media filter is to be installed below ground and discharge would need to be pumped to the surface. However that is not reflected on the Utility Plan. b. Plot and label the total the number of disconnected downspouts. The civil has indicated that the downspouts runoff will drain into the media filter, but it's not clear on the plans how this will be accomplished. c. The site plan shall demonstrate how the runoff from the MFS flows by gravity into the gutter, provide pipe inverts and flowline grades. If a new separate structure is required to allow runoff to flow by gravity into the gutter or reduce the velocity, then the structure shall be located completely within the private property. The 4th and 5th resubmittal ARB plans show a junction box within the public right of way, this box shall be located completely within the private property. d. The 5th submittal shows a planter box adjacent to the alley and the MFS has been relocated to be within this planter boxes. The plans submitted lack information, show how the roof runoff is directed into the mechanical treatment facility. Plot and label the pump, drain lines, downspouts. Show how all of the site runoff is treated by the proposed MFS. e. It's not clear if the planter box is intended to provide C3 treatment. If LID treatment is proposed provide the surface drainage areas and calculations. f. Resize the new planter box to allow the junction box to be within the private property and behind the Kipling Street sidewalk. The planter box and planting material shall be revised to meet the 4 -ft by 6 -ft clear site distance and height clearance. In addition the planter box shall be located 1 -foot minimum away from the adjacent alley. 39. GRADING AND DRAINAGE PLAN: The plan set must include a grading & drainage plan prepared by a licensed professional that includes existing and proposed spot elevations, earthwork volumes, finished floor elevations at every at grade door entrance, area drain and bubbler locations, drainage flow arrows to demonstrate proper drainage of the site. See Palo Alto Municipal Code Section 16.28 Adjacent grades must slope away from the building foundation at minimum of 2% or 5% for 10 -feet per 2013 CBC Section 1804.3. Downspouts and splashblocks should be shown on this plan, as well as any site drainage features such as swales. Grading will not be allowed that increases drainage onto, or blocks existing drainage from, neighboring properties. Public Works generally does not allow rainwater to be collected and discharged into the street gutter or connected directly to the City's infrastructure, but encourages the developer to keep rainwater onsite as much as feasible by directing runoff to landscape and other pervious areas of the site. Plan shall also include a drainage system as required for all uncovered exterior basement -level spaces such as lightwell, stairwells or driveway ramps. 40. BASEMENT DRAINAGE: Due to high groundwater throughout much of the City and Public Works prohibiting the pumping and discharging of groundwater, perforated pipe drainage systems at the exterior of the basement walls or under the slab are not allowed for this site. A drainage system is, however, required for all exterior basement -level spaces, such as lightwells, patios or stairwells. This system consists of a sump, a sump pump, a backflow preventer, and a closed pipe from the pump to a dissipation device onsite at least 10 -feet from the property line, such as a bubbler box in a landscaped area, so that water can percolate into the soil and/or sheet flow across the site. The device must not DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F allow stagnant water that could become mosquito habitat. Additionally, the plans must show that exterior basement -level spaces are at least 7-3/4" below any adjacent windowsills or doorsills to minimize the potential for flooding the basement. Public Works recommends a waterproofing consultant be retained to design and inspect the vapor barrier and waterproofing systems for the basement. 41. IMPERVIOUS SURFACE AREA: The project will be creating or replacing 500 square feet or more of impervious surface. Accordingly, the applicant shall provide calculations of the existing and proposed impervious surface areas with the building permit application. The Impervious Area Worksheet for Land Developments form and instructions are available at the Development Center or on our website. 42. STORM WATER POLLUTION PREVENTION: The City's full-sized "Pollution Prevention - It's Part of the Plan" sheet must be included in the plan set. The sheet is available here: http://www.cityofpaloalto.org/civicax/filebank/documents/2732 43. STORM WATER TREATMENT: This project shall comply with the storm water regulations contained in provision C.3 of the NPDES municipal storm water discharge permit issued by the San Francisco Bay Regional Water Quality Control Board (and incorporated into Palo Alto Municipal Code Chapter 16.11). These regulations apply to land development projects that create or replace 10,000 square feet or more of impervious surface, and restaurants, retail gasoline outlets, auto service facilities, and uncovered parking lots that create and/or replace 5,000 square feet or more of impervious surface. In order to address the potential permanent impacts of the project on storm water quality, the applicant shall incorporate into the project a set of permanent site design measures, source controls, and treatment controls that serve to protect storm water quality, subject to the approval of the Public Works Department. The applicant shall identify, size, design and incorporate permanent storm water pollution prevention measures (preferably landscape -based treatment controls such as bioswales, filter strips, and permeable pavement rather than mechanical devices that require long-term maintenance) to treat the runoff from a "water quality storm" specified in PAMC Chapter 16.11 prior to discharge to the municipal storm drain system. Effective February 10, 2011, regulated projects, must contract with a qualified third -party reviewer during the building permit review process to certify that the proposed permanent storm water pollution prevention measures comply with the requirements of Palo Alto Municipal Code Chapter 16.11. The certification form, 2 copies of approved storm water treatment plan, and a description of Maintenance Task and Schedule must be received by the City from the third - party reviewer prior to approval of the building permit by the Public Works department. Within 45 days of the installation of the required storm water treatment measures and prior to the issuance of an occupancy permit for the building, third -party reviewer shall also submit to the City a certification for approval. 44. UTILITY PLAN: shall be provided with the Building Permit that demonstrates how the site's drainage flows by gravity into the City's system and is not pumped. Public Works generally does not allow downspout rainwater to be collected, piped and discharged directly into the street gutter or connect directly to the City's infrastructure. The utility plan shall indicate that downspouts are disconnected, daylight at grade, and are directed to landscaped and other pervious areas onsite. Downspouts shall daylight away from the foundation. If pumps are required, plot and label where the pumps will be located on -site, storm water runoff from pumped system shall daylight onto onsite landscaped areas and be allow to infiltrate and flow by gravity DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F to the public storm drain line. Storm water runoff that is pumped shall not be directly piped into the public storm drain line. 45. TRANSFORMER AND UTILITIES: Applicant shall be aware that the project may trigger water line and meter upgrades or relocation, if upgrades or relocation are required, the building permit plan set shall plot and label utility changes. The backflow preventer, and above grade meters shall be located within private property and plotted on the plans. Similarly if a transformer upgrade or a grease interceptor is required it shall also be located within the private property. 46. WORK IN THE RIGHT-OF-WAY: The plans must clearly indicate any work that is proposed in the public right-of-way, such as sidewalk replacement, driveway approach, or utility laterals. The plans must include notes that the work must be done per City standards and that the contractor performing this work must first obtain a Street Work Permit from Public Works at the Development Center. This project may be required to replace the driveway approach the sidewalk associated with the existing driveway may be required to replaced with a thickened (6" thick instead of the standard 4" thick) section. 47. SIDEWALK ENCROACHMENT: Add a note to the site plan that says, "The contractor using the city sidewalk to work on an adjacent private building must do so in a manner that is safe for pedestrians using the sidewalk. Pedestrian protection must be provided per the 2013 California Building Code Chapter 32 requirements. If the height of construction is 8 feet or less, the contractor must place construction railings sufficient to direct pedestrians around construction areas. If the height of construction is more than 8 feet, the contractor must obtain an encroachment permit from Public Works at the Development Center in order to provide a barrier and covered walkway. The contractor must apply to Public Works for an encroachment permit to close or occupy the sidewalk(s) or lane." 48. SIDEWALK, CURB & GUTTER: As part of this project, the applicant must replace all of the existing sidewalks, ramps, curbs, gutters or driveway approaches in the public right-of-way along the frontage(s) of the property. Applicant shall be responsible for replacing the two ramps immediately across the street from the project site. Applicant shall meet with Public Works and Transportation to discuss the potential for adding a bulb -out along the University Avenue side to widen the sidewalk. If construction of the new ramps and/or sidewalk results in a conflict with utilities or traffic signal than applicant will be responsible for adjusting to grade or relocating conflict and to bring the improvements to current designs standards. The site plan and grading and drainage plan submitted with the building permit plan set must show the extent of the replacement work. Provide references to the specific City's Standard Drawings and Specification. The plan must note that any work in the right-of-way must be done per Public Works' standards by a licensed contractor who must first obtain a Street Work Permit from Public Works at the Development Center. 49. RESURFACING: The applicant is required to resurface (grind and overlay) the entire width of the street on University Avenue and Kipling Street frontages adjacent to the project. In addition this project is required to resurface the full width of the Lane along the project frontage. Note that the base material for these 3 streets varies. Thermoplastic striping of the street(s) will be required after resurfacing. Include an off -site plan that shows the existing signage and striping that is to be replaces as part of this project and for the contractor's use. 50. DEMOLITION PLAN: Place the following note adjacent to an affected tree on the Site Plan and Demolition Plan: "Excavation activities associated with the proposed scope of work shall occur no closer DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F than 10 -feet from the existing street tree, or as approved by the Urban Forestry Division contact 650- 496-5953. Any changes shall be approved by the same". 51. STREET TREES: The applicant may be required to replace existing and/or add new street trees in the public right-of-way along the property's frontage(s). Call the Public Works' arborist at 650-496-5953 to arrange a site visit so he can determine what street tree work, if any, will be required for this project. The site plan submitted with the building permit plan set must show the street tree work that the arborist has determined, including the tree species, size, location, staking and irrigation requirements, or include a note that Public Works' arborist has determined no street tree work is required. The plan must note that in order to do street tree work, the applicant must first obtain a Permit for Street Tree Work in the Public Right -of -Way from Public Works' arborist (650-496-5953). 52. GARBAGE/TRASH RECEPTACLES: The plans provided for preliminary review do not include the existing garbage/trash receptacle along University Avenue. This shall be shown on the Building permit plans and remain in its location for as long as possible during construction. If construction activities require the temporary removal of the receptacle, the contractor may remove during that construction activity but must place it back as soon as those activities have been completed. Prior to doing so, the contractor must notify the public works department to determine if Public Works Operations should pick it up for storage during that time. 53. ADJACENT NEIGHBORS: For any improvements that extend beyond the property lines such as tie -backs for the basement or construction access provide signed copies of the original agreements with the adjacent property owners. The agreements shall indicate that the adjacent property owners have reviewed and approved the proposed improvements (such as soldier beams, tiebacks) that extend into their respective properties 54. "NO DUMPING" LOGO: The applicant is required to paint the "No Dumping/Flows to San Franscisquito Creek" logo in blue color on a white background, adjacent to all onsite storm drain inlets. Stencils of the logo are available from the Public Works Environmental Compliance Division, which may be contacted at (650) 329-2598. A deposit may be required to secure the return of the stencil. Include the instruction to paint the logos on the construction grading and drainage plan. Similar medallions shall be installed near the catch basins that are proposed to be relocated. Provide notes on the plans to reference that medallions and stencils. 55. OIL/WATER SEPARATOR: Parking garage floor drains on interior levels shall be connected to an oil/water separator prior to discharging to the sanitary sewer system. The oil/water separator shall be located within private property. 56. GREASE INTERCEPTOR: If a commercial kitchen is proposed requiring the installation of a grease interceptor, the grease separator shall be installed and located within private property. In no case shall the City of Palo Alto allow the right-of-way (ROW) to be used to satisfy this requirement. PRIOR TO BUILDING PERMIT FINAL: 57. STORM WATER TREATMENT: At the time of installation of the required storm water treatment measures and prior to the issuance of any occupancy permit, a third -party reviewer shall also submit to the City a DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F certification for approval that the project's permanent measures were constructed and installed in accordance to the approved permit drawings. 58. STORMWATER MAINTENANCE AGREEMENT: The applicant shall designate a party to maintain the control measures for the life of the improvements and must enter into a maintenance agreement with the City to guarantee the ongoing maintenance of the permanent C.3 storm water discharge compliance measures. The maintenance agreement shall be executed prior to the first building occupancy sign -off. The City will inspect the treatment measures yearly and charge an inspection fee. There is currently a $381 (FY 2015) C.3 plan check fee that will be collected upon submittal for a grading or building permit. 59. Contractor and/or Applicant shall prepare and submit an electronic (pdf) copy of the Off -Site Improvements As -Built set of plans to Public Works for the City's records. The as -built set shall include all the improvements within the public road right-of-way and include items such as: shoring piles, tiebacks, public storm drain improvements, traffic signs, street trees, location of any vaults or boxes, and any other item that was installed as part of this project. 60. Contractor shall submit and obtain an Encroachment permit for the permanent structures (shoring and tiebacks) that were installed within the public road right-of-way. Fire Department 61. Residential sprinklers to be designed per NFPA 13. Fire sprinklers and fire alarm systems and standpipes required in accordance with NFPA 13, NFPA14, NFPA 24, NFPA 72 and State and local standards. Sprinkler, fire alarm and underground fire supply installations require separate submittal to the Fire Prevention Bureau. 62. Sprinkler main drain must be coordinated with plumbing design so that 200 gpm can be flowed for annual main drain testing for 90 seconds without overflowing the collection sump, and the Utilities Department approved ejector pumps will be the maximum flow rate to sanitary sewer. 63. Applicant shall work with Utilities Department to provide acceptable backflow prevention configuration. 64. All floor levels in multi -story buildings must be served by an elevator capable of accommodating a 24 x 84 inch gurney without lifting or manipulating the gurney. 65. All welding or other hot work during construction shall be under a permit obtained from the Palo Alto Fire Department with proper notification and documentation of procedures followed and work conducted. 66. Low -E glass and underground parking areas can interfere with portable radios used by emergency responders. Please provide an RF Engineering analysis to determine if additional devices or equipment will be needed to maintain operability of emergency responder portable radios throughout 97% of the multi -family buildings in accordance with the Fire Code Appendix J as adopted by the City of Palo Alto. A written report to the Fire Marshal shall be provided prior to final inspection. Utilities Electrical Engineering DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F GENERAL: 67. The applicant shall comply with all the Electric Utility Engineering Department service requirements noted during plan review. 68. The applicant shall be responsible for identification and location of all utilities, both public and private, within the work area. Prior to any excavation work at the site, the applicant shall contact Underground Service Alert (USA) at 1-800-227-2600, at least 48 hours prior to beginning work. 69. The applicant shall submit a request to disconnect all existing utility services and/or meters including a signed affidavit of vacancy, on the form provided by the Building Inspection Division. Utilities will be disconnected or removed within 10 working days after receipt of request. The demolition permit will be issued after all utility services and/or meters have been disconnected and removed. THE FOLLOWING SHALL BE INCORPORATED IN SUBMITTALS FOR ELECTRIC SERVICE: 70. A completed Electric Load Sheet and a full set of plans must be included with all applications involving electrical work. The load sheet must be included with the preliminary submittal. 71. Industrial and large commercial customers must allow sufficient lead-time for Electric Utility Engineering and Operations (typically 8-12 weeks after advance engineering fees have been paid) to design and construct the electric service requested. 72. Only one electric service lateral is permitted per parcel. Utilities Rule & Regulation #18. 73. This project requires a padmount transformer. The location of the transformer shall be shown on the site plan and approved by the Utilities Department and the Architectural Review Board. Utilities Rule & Regulations #3 & #16. 74. The developer/owner shall provide space for installing padmount equipment (i.e. transformers, switches, and interrupters) and associated substructure as required by the City. 75. The customer shall install all electrical substructures (conduits, boxes and pads) required from the service point to the customer's switchgear. The design and installation shall be according to the City standards and shown on plans. Utilities Rule & Regulations #16 & #18. 76. Location of the electric panel/switchboard shall be shown on the site plan and approved by the Architectural Review Board and Utilities Department. 77. All utility meters, lines, transformers, backflow preventers, and any other required equipment shall be shown on the landscape and irrigation plans and shall show that no conflict will occur between the utilities and landscape materials. In addition, all aboveground equipment shall be screened in a manner that is consistent with the building design and setback requirements. 78. For services larger than 1600 amps, the customer will be required to provide a transition cabinet as the interconnection point between the utility's padmount transformer and the customer's main switchgear. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F The cabinet design drawings must be submitted to the Electric Utility Engineering Department for review and approval. 79. For underground services, no more than four (4) 750 MCM conductors per phase can be connected to the transformer secondary terminals; otherwise, bus duct must be used for connections to padmount transformers. If customer installs a bus duct directly between the transformer secondary terminals and the main switchgear, the installation of a transition cabinet will not be required. 80. The customer is responsible for sizing the service conductors and other required equipment according to the National Electric Code requirements and the City standards. Utilities Rule & Regulation #18. 81. If the customer's total load exceeds 2500 kVA, service shall be provided at the primary voltage of 12,470 volts and the customer shall provide the high voltage switchgear and transformers. 82. For primary services, the standard service protection is a padmount fault interrupter owned an maintained by the City, installed at the customer's expense. The customer must provide and install the pad and associated substructure required for the fault interrupter. 83. Any additional facilities and services requested by the Applicant that are beyond what the utility deems standard facilities will be subject to Special Facilities charges. The Special Facilities charges include the cost of installing the additional facilities as well as the cost of ownership. Utilities Rule & Regulation #20. 84. Projects that require the extension of high voltage primary distribution lines or reinforcement of offsite electric facilities will be at the customer's expense and must be coordinated with the Electric Utility. DURING CONSTRUCTION: 85. Contractors and developers shall obtain permit from the Department of Public Works before digging in the street right-of-way. This includes sidewalks, driveways and planter strips. 86. At least 48 hours prior to starting any excavation, the customer must call Underground Service Alert (USA) at 1-800-227-2600 to have existing underground utilities located and marked. The areas to be check by USA shall be delineated with white paint. All USA markings shall be removed by the customer or contractor when construction is complete. 87. The customer is responsible for installing all on -site substructures (conduits, boxes and pads) required for the electric service. No more than 270 degrees of bends are allowed in a secondary conduit run. All conduits must be sized according to National Electric Code requirements and no 1/2 — inch size conduits are permitted. All off -site substructure work will be constructed by the City at the customer's expense. Where mutually agreed upon by the City and the Applicant, all or part of the off -site substructure work may be constructed by the Applicant. 88. All primary electric conduits shall be concrete encased with the top of the encasement at the depth of 30 inches. No more than 180 degrees of bends are allowed in a primary conduit run. Conduit runs over 500 feet in length require additional pull boxes. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 89. All new underground conduits and substructures shall be installed per City standards and shall be inspected by the Electrical Underground Inspector before backfilling. 90. The customer is responsible for installing all underground electric service conductors, bus duct, transition cabinets, and other required equipment. The installation shall meet the National Electric Code and the City Standards. 91. Meter and switchboard requirements shall be in accordance with Electric Utility Service Equipment Requirements Committee (EUSERC) drawings accepted by Utility and CPA standards for meter installations. 92. Shop/factory drawings for switchboards (400A and greater) and associated hardware must be submitted for review and approval prior to installing the switchgear to: Gopal Jagannath, P.E. Supervising Electric Project Engineer Utilities Engineering (Electrical) 1007 Elwell Court Palo Alto, CA 94303 93. Catalog cut sheets may not be substituted for factory drawing submittal. 94. All new underground electric services shall be inspected and approved by both the Building Inspection Division and the Electrical Underground Inspector before energizing. AFTER CONSTRUCTION & PRIOR TO FINALIZATION: 95. The customer shall provide as -built drawings showing the location of all switchboards, conduits (number and size), conductors (number and size), splice boxes, vaults and switch/transformer pads. PRIOR TO ISSUANCE OF BUILDING OCCUPANCY PERMIT: 96. The applicant shall secure a Public Utilities Easement for facilities installed on private property for City use. 97. All required inspections have been completed and approved by both the Building Inspection Division and the Electrical Underground Inspector. 98. All Special Facilities contracts or other agreements need to be signed by the City and applicant. ADDITIONAL COMMENTS: 99. The following conditions apply to three-phase service and any service over 400 amperes: a. A padmount transformer is required. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F b. The Utilities Director, or his/her designee, may authorize the installation of submersible or vault installed facilities if in their opinion, padmounted equipment would not be feasible or practical. c. Submersible or vault installed facilities shall be considered Special Facilities as described in Rule and Regulation 20, and all costs associated with the installation, including continuing ownership and maintenance, will be borne by the applicant (see Rule and Regulation 3 for details). d. The customer must provide adequate space for installation, or reimburse the Utility for additional costs to locate the transformer outside the property boundaries. All service equipment must be located above grade level unless otherwise approved by Electric Engineering. Utilities Water Gas Wastewater Department PRIOR TO ISSUANCE OF DEMOLITION PERMIT: 100. Prior to demolition, the applicant shall submit the existing water/wastewater fixture unit loads (and building as -built plans to verify the existing loads) to determine the capacity fee credit for the existing load. If the applicant does not submit loads and plans they may not receive credit for the existing water/wastewater fixtures. 101. The applicant shall submit a request to disconnect all utility services and/or meters including a signed affidavit of vacancy. Utilities will be disconnected or removed within 10 working days after receipt of request. The demolition permit will be issued by the building inspection division after all utility services and/or meters have been disconnected and removed. FOR BUILDING PERMIT: 102. The applicant shall submit completed water -gas -wastewater service connection applications - load sheets for City of Palo Alto Utilities for each unit or place of business. The applicant must provide all the information requested for utility service demands (water in fixture units/g.p.m., gas in b.t.u.p.h, and sewer in fixture units/g.p.d.). The applicant shall provide the existing (prior) loads, the new loads, and the combined/total loads (the new loads plus any existing loads to remain). 103. The applicant shall submit improvement plans for utility construction. The plans must show the size and location of all underground utilities within the development and the public right of way including meters, backflow preventers, fire service requirements, sewer mains, sewer cleanouts, sewer lift stations and any other required utilities. 104. The applicant must show on the site plan the existence of any auxiliary water supply (i.e. water well, gray water, recycled water, rain catchment, water storage tank, etc). 105. The applicant shall be responsible for installing and upgrading the existing utility mains and/or services as necessary to handle anticipated peak loads. This responsibility includes all costs associated with the design and construction for the installation/upgrade of the utility mains and/or services. 106. The applicant's engineer shall submit flow calculations and system capacity study showing that the on - site and off -site water and sanitary sewer mains and services will provide the domestic, irrigation, fire DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F flows, and wastewater capacity needed to service the development and adjacent properties during anticipated peak floor demands. Field testing may be required to determine current flows and water pressures on existing water main. Calculations must be signed and stamped by a registered civil engineer. The applicant is required to perform, at his/her expense, a flow monitoring study of the existing sewer main to determine the remaining capacity. The report must include existing peak flows or depth of flow based on a minimum monitoring period of seven continuous days or as determined by the senior wastewater engineer. The study shall meet the requirements and the approval of the WGW engineering section. No downstream overloading of existing sewer main will be permitted. 107. For contractor installed water and wastewater mains or services, the applicant shall submit to the WGW engineering section of the Utilities Department four copies of the installation of public water, gas and wastewater utilities improvement plans (the portion to be owned and maintained by the City) in accordance with the utilities department design criteria. All utility work within the public right-of-way shall be clearly shown on the plans that are prepared, signed and stamped by a registered civil engineer. The contractor shall also submit a complete schedule of work, method of construction and the manufacture's literature on the materials to be used for approval by the utilities engineering section. The applicant's contractor will not be allowed to begin work until the improvement plan and other submittals have been approved by the water, gas and wastewater engineering section. After the work is complete but prior to sign off, the applicant shall provide record drawings (as-builts) of the contractor installed water and wastewater mains and services per City of Palo Alto Utilities' record drawing procedures. For contractor installed services the contractor shall install 3M marker balls at each water or wastewater service tap to the main and at the City clean out for wastewater laterals. 108. An approved reduced pressure principle assembly (RPPA backflow preventer device) is required for all existing and new water connections from Palo Alto Utilities to comply with requirements of California administrative code, title 17, sections 7583 through 7605 inclusive. The RPPA shall be installed on the owner's property and directly behind the water meter within 5 feet of the property line. RPPA's for domestic service shall be lead free. Show the location of the RPPA on the plans. 109. An approved reduced pressure detector assembly is required for the existing or new water connection for the fire system to comply with requirements of California administrative code, title 17, sections 7583 through 7605 inclusive (a double detector assembly may be allowed for existing fire sprinkler systems upon the CPAU's approval). Reduced pressure detector assemblies shall be installed on the owner's property adjacent to the property line, within 5' of the property line. Show the location of the reduced pressure detector assembly on the plans. 110. All backflow preventer devices shall be approved by the WGW engineering division. Inspection by the utilities cross connection inspector is required for the supply pipe between the meter and the assembly. 111. Existing wastewater laterals that are not plastic (ABS, PVC, or PE) shall be replaced at the applicant's expense. 112. Existing wastewater main is 5.4" PE on Kipling Street. (sewer lateral to be 4") 113. Existing water services (including fire services) that are not a currently standard material shall be replaced at the applicant's expense. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 114. The applicant shall pay the capacity fees and connection fees associated with new utility service/s or added demand on existing services. The approved relocation of services, meters, hydrants, or other facilities will be performed at the cost of the person/entity requesting the relocation. 115. Each unit or place of business shall have its own water and gas meter shown on the plans. Each parcel shall have its own water service, gas service and sewer lateral connection shown on the plans. 116. A separate water meter and backflow preventer is required to irrigate the approved landscape plan. Show the location of the irrigation meter on the plans. This meter shall be designated as an irrigation account and no other water service will be billed on the account. The irrigation and landscape plans submitted with the application for a grading or building permit shall conform to the City of Palo Alto water efficiency standards. 117. A new water service line installation for domestic usage is required. For service connection of 4 -inch through 8 -inch sizes, the applicant's contractor must provide and install a concrete vault with meter reading lid covers for water meter and other required control equipment in accordance with the utilities standard detail. Show the location of the new water service and meter on the plans. 118. A new water service line installation for irrigation usage may require. Show the location of the new water service and meter on the plans. 119. A new water service line installation for fire system usage is required. Show the location of the new water service on the plans. The applicant shall provide to the Engineering Department a copy of the plans for fire system including all Fire Department's requirements. Please see a fire/domestic combination service connection for your provide- see City of Palo Alto standard WD -11. 120. A new gas service line installation is required. Show the new gas meter location on the plans. The gas meter location must conform with utilities standard details. Gas meter to be installed above ground. 121. A new sewer lateral installation per lot is required. Show the location of the new sewer lateral on the plans. 122. All existing water and wastewater services that will not be reused shall be abandoned at the main per WGW utilities procedures. 123. Utility vaults, transformers, utility cabinets, concrete bases, or other structures cannot be placed over existing water, gas or wastewater mains/services. Maintain 1' horizontal clear separation from the vault/cabinet/concrete base to existing utilities as found in the field. If there is a conflict with existing utilities, Cabinets/vaults/bases shall be relocated from the plan location as needed to meet field conditions. Trees may not be planted within 10 feet of existing water, gas or wastewater mains/services or meters. New water, gas or wastewater services/meters may not be installed within 10' or existing trees. Maintain 10' between new trees and new water, gas and wastewater services/mains/meters. 124. To install new gas service by directional boring, the applicant is required to have a sewer cleanout at the front of the building. This cleanout is required so the sewer lateral can be videoed for verification of no damage after the gas service is installed by directional boring. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 125. All utility installations shall be in accordance with the City of Palo Alto utility standards for water, gas & wastewater. 126. All WGW utilities work on University Avenue is 1.5 times the stated fee due to traffic; existing conditions require the work to be done outside of regular work hours. Zero Waste/Solid Waste PRIOR TO ISSUANCE OF A BUILDING PERMIT 127. Provide a garbage and recycling chute for the residential unit with either an additional chute or a bin space for compostables on the residential floor. 128. SERVICE LEVELS: Without a restaurant: the enclosure should be sized for 3 -yard garbage bin, 4 -yard recycling bin, 1 -yard compostables bin; with a restaurant: With a restaurant: 3 -yard garbage bin, 4 -yard recycling bin, 2 -yard compostables bin. 129. TRASH DISPOSAL AND RECYCLING (PAMC 18.23.020): (A) Assure that development provides adequate and accessible interior areas or exterior enclosures for the storage of trash and recyclable materials in appropriate containers, and that trash disposal and recycling areas are located as far from abutting residences as is reasonably possible. (B) Requirements: (i) Trash disposal and recyclable areas shall be accessible to all residents or users of the property. (ii) Recycling facilities shall be located, sized, and designed to encourage and facilitate convenient use. (iii) Trash disposal and recyclable areas shall be screened from public view by masonry or other opaque and durable material, and shall be enclosed and covered. Gates or other controlled access shall be provided where feasible. Chain link enclosures are strongly discouraged. (iv) Trash disposal and recycling structures shall be architecturally compatible with the design of the project. (v) The design, construction and accessibility of recycling areas and enclosures shall be subject to approval by the architectural review board, in accordance with design guidelines adopted by that board and approved by the city council pursuant to Section 18.76.020. 130. RECYCLING STORAGE DESIGN REQUIREMENTS (PAMC 5.20.120): The design of any new, substantially remodeled, or expanded building or other facility shall provide for proper storage, handling, and accessibility which will accommodate the solid waste and recyclable materials loading anticipated and which will allow for the efficient and safe collection. The design shall comply with the applicable provisions of Sections 18.22.100, 18.24.100, 18.26.100, 18.32.080, 18.37.080, 18.41.080, 18.43.080, 18.45.080, 18.49.140, 18.55.080, 18.60.080, and 18.68.170 of Title 18 of this code. 131. SERVICE REQUIREMENTS: (a) Collection vehicle access (vertical clearance, street width and turnaround space) and street parking are common issues pertaining to new developments. Adequate space must be provided for vehicle access. (b) Weight limit for all drivable areas to be accessed by the solid waste vehicles (roads, driveways, pads) must be rated to 60,000 lbs. This includes areas where permeable pavement is used. (c) Containers must be within 25 feet of service area or charges will apply. (d) Carts and bins must be able to roll without obstacles or curbs to reach service areas "no jumping curbs". 132. GARBAGE, RECYCLING, AND YARD WASTE/COMPOSTABLES CART/ BIN LOCATION AND SIZING: DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F a. Office Building: The proposed commercial development must follow the requirements for recycling container space'. Project plans must show the placement of recycling containers, for example, within the details of the solid waste enclosures. Collection space should be provided for built-in recycling containers/storage on each floor/office or alcoves for the placement of recycling containers. i. Enclosure and access should be designed for equal access to all three waste streams — garbage, recycling, and compostables. ii. Collection cannot be performed in underground. Underground bins locations require a minimum of 77" of vertical clearance. Pull out charges will apply. In instances where push services are not available (e.g., hauler driver cannot push containers up or down ramps), the property owner will be responsible for placing solid waste containers in an accessible location for collection. iii. All service areas must have a clearance height of 20' for bin service. iv. New enclosures should consider rubber bumpers to reduce ware and tear on walls. For questions regarding garbage, recycling, and compostables collection issues, contact Green Waste of Palo Alto (650) 493-4894. b. Restaurants and Food Service Establishments: Please contact Green Waste of Palo Alto (650) 493-4894 to maximize the collection of compostables in food preparation areas and customer areas. For more information about compostable food service products, please contact City of Palo Alto Zero Waste at (650) 496-5910. c. Multi -family Residential: The proposed multi -family development must follow the requirements for recycling container space'. All residential developments, where central garbage, recycling, and compostables containers will serve five or more dwelling units, must have space for the storage and collection of recyclables and compostables. This includes the provision of recycling chutes where garbage chutes are provided. Project plans must show the placement of recycling and compostables containers, for example, within the details of the solid waste enclosures. i. Enclosure and access should be designed for equal access to all three waste streams — garbage, recycling, and compostables. ii. Collection cannot be performed in underground. Underground bins locations require a minimum of 77" of vertical clearance. Pull out charges will apply. In instances where push services are not available (e.g., hauler driver cannot push containers up or down ramps), the property owner will be responsible for placing solid waste containers in an accessible location for collection. iii. All service areas must have a clearance height of 20' for bin service. iv. New enclosures should consider rubber bumpers to reduce wear -and -tear on walls. For questions regarding garbage, recycling, and compostables collection issues, contact Green Waste of Palo Alto (650) 493-4894. 133. COVERED DUMPSTERS, RECYCLING AND TALLOW BIN AREAS (PAMC 16.09.075(q)(2)): 1 In accordance with the California Public Resources Code, Chapter 18, Articles 1 and 2 2 In accordance with the California Public Resources Code, Chapter 18, Articles 1 and 2 DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F a. Newly constructed and remodeled Food Service Establishments (FSEs) shall include a covered area for all dumpsters, bins, carts or container used for the collection of trash, recycling, food scraps and waste cooking fats, oils and grease (FOG) or tallow. b. The area shall be designed and shown on plans to prevent water run-on to the area and runoff from the area. c. Drains that are installed within the enclosure for recycle and waste bins, dumpsters and tallow bins serving FSEs are optional. Any such drain installed shall be connected to a Grease Control Device (GCD). d. If tallow is to be stored outside then an adequately sized, segregated space for a tallow bin shall be included in the covered area. e. These requirements shall apply to remodeled or converted facilities to the extent that the portion of the facility being remodeled is related to the subject of the requirement. It is frequently to the FSE's advantage to install the next size larger GCD to allow for more efficient grease discharge prevention and may allow for longer times between cleaning. There are many manufacturers of GCDs which are available in different shapes, sizes and materials (plastic, reinforced fiberglass, reinforced concrete and metal). The requirements will assist FSEs with FOG discharge prevention to the sanitary sewer and storm drain pollution prevention. The FSE at all times shall comply with the Sewer Use Ordinance of the Palo Alto Municipal Code. The ordinances include requirements for GCDs, GCD maintenance, drainage fixtures, record keeping and construction projects. 134. CONSTRUCTION AND DEMOLITION DEBRIS (CDD) (PAMC 5.24.030): a. Covered projects shall comply with construction and demolition debris diversion rates and other requirements established in Chapter 16.14 (California Green Building Code). In addition, all debris generated by a covered project must haul 100 percent of the debris not salvaged for reuse to an approved facility as set forth in this chapter. b. Contact the City of Palo Alto's Green Building Coordinator for assistance on how to recycle construction and demolition debris from the project, including information on where to conveniently recycle the material. Public Works Water Quality Control 135. DISCHARGE OF GROUNDWATER (PAMC 16.09.170, 16.09.040): Prior approval shall be obtained from the city engineer or designee to discharge water pumped from construction sites to the storm drain. The city engineer or designee may require gravity settling and filtration upon a determination that either or both would improve the water quality of the discharge. Contaminated ground water or water that exceeds state or federal requirements for discharge to navigable waters may not be discharged to the storm drain. Such water may be discharged to the sewer, provided that the discharge limits contained in Palo Alto Municipal Code (16.09.040(m)) are not exceeded and the approval of the superintendent is obtained prior to discharge. The City shall be compensated for any costs it incurs in authorizing such discharge, at the rate set forth in the Municipal Fee Schedule. 136. UNPOLLUTED WATER (PAMC 16.09.055): Unpolluted water shall not be discharged through direct or indirect connection to the sanitary sewer system (e.g. uncovered ramp to garage area). DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 137. COVERED PARKING (PAMC 16.09.180(b)(9)): If installed, drain plumbing for parking garage floor drains must be connected to an oil/water separator with a minimum capacity of 100 gallons, and to the sanitary sewer system. 138. DUMPSTERS FOR NEW AND REMODELED FACILITATIES (PAMC 16.09.180(b)(10)): New buildings and residential developments providing centralized solid waste collection, except for single-family and duplex residences, shall provide a covered area for a dumpster. The area shall be adequately sized for all waste streams and designed with grading or a berm system to prevent water runon and runoff from the area. 139. ARCHITECTURAL COPPER PAMC (16.09.180(b)(14)): On and after January 1, 2003, copper metal roofing, copper metal gutters, copper metal down spouts, and copper granule containing asphalt shingles shall not be permitted for use on any residential, commercial or industrial building for which a building permit is required. Copper flashing for use under tiles or slates and small copper ornaments are exempt from this prohibition. Replacement roofing, gutters and downspouts on historic structures are exempt, provided that the roofing material used shall be prepatinated at the factory. For the purposes of this exemption, the definition of "historic" shall be limited to structures designated as Category 1 or Category 2 buildings in the current edition of the Palo Alto Historical and Architectural Resources Report and Inventory. 140. LOADING DOCKS (PAMC 16.09.175(k) (2)): (i) Loading dock drains to the storm drain system may be allowed if equipped with a fail-safe valve or equivalent device that is kept closed during the non -rainy season and during periods of loading dock operation. (ii) Where chemicals, hazardous materials, grease, oil, or waste products are handled or used within the loading dock area, a drain to the storm drain system shall not be allowed. A drain to the sanitary sewer system may be allowed if equipped with a fail- safe valve or equivalent device that is kept closed during the non -rainy season and during periods of loading dock operation. The area in which the drain is located shall be covered or protected from rainwater run-on by berms and/or grading. Appropriate wastewater treatment approved by the Superintendent shall be provided for all rainwater contacting the loading dock site. 141. CONDENSATE FROM HVAC (PAMC 16.09.180(b)(5)): Condensate lines shall not be connected or allowed to drain to the storm drain system. 142. SILVER PROCESSING (e.g. photoprocessing retail) (PAMC 16.09.215): Facilities conducting silver processing (photographic or X-ray films) shall either submit a treatment application or waste hauler certification for all spent silver bearing solutions. 650-329-2421. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 143. COPPER PIPING (PAMC 16.09.180(b)(b)): Copper, copper alloys, lead and lead alloys, including brass, shall not be used in sewer lines, connectors, or seals coming in contact with sewage except for domestic waste sink traps and short lengths of associated connecting pipes where alternate materials are not practical. The plans must specify that copper piping will not be used for wastewater plumbing. 144. MERCURY SWITCHES (PAMC 16.09.180(12)): Mercury switches shall not be installed in sewer or storm drain sumps. 145. COOLING SYSTEMS, POOLS, SPAS, FOUNTAINS, BOILERS AND HEAT EXCHANGERS (PAMC 16.09.205(a)): It shall be unlawful to discharge water from cooling systems, pools, spas, fountains boilers and heat exchangers to the storm drain system. 146. UNDESIGNATED RETAIL SPACE (PAMC 16.09): Newly constructed or improved buildings with all or a portion of the space with undesignated tenants or future use will need to meet all requirements that would have been applicable during design and construction. If such undesignated retail space becomes a food service facility the following requirements must be met, in addition to other applicable codes: Grease Control Device (GCD) Requirements, PAMC Section 16.09.075; Drainage Fixture Requirements, PAMC Section 16.09.075; Covered Dumpsters, Recycling and Tallow Bin Areas PAMC, 16.09.075(q)(2); Large Item Cleaning Sink, PAMC 16.09.075(m)(2)(B). PASSED: 5-3-1 AYES: Filseth, Fine, Scharff, Tanaka, Wolbach NOES: DuBois, Holman, Kou, ABSENT: ABSTENTIONS: Kniss ATTEST: c6DocuSigned by: e MIAOr 45FA550911R71492 DocuSigned by: 6FB3765F09D34EA... City Clerk Mayor APPROVED AS TO CONTENT: DocuSigned by: LJO4L L.,1.F 293CF322E1294F6 Director of Planning and Community Environment APPROVED AS TO FORM: ,-DocuSigned by: atkviL q 15B6C45220134DC... Senior Asst. City Attorney PLANS AND DRAWINGS REFERENCED: Those plans prepared by Jo Bellomo Associates titled "429 University Avenue", consisting of 24 pages, dated October 26, 2016. DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F Exhibit A INTRODUCTION 429 University Avenue Project Mitigation Monitoring Program Section 15097 of the Guidelines for the California Environmental Quality Act (CEQA) requires that, whenever a public agency approves a project based on a Mitigated Negative Declaration (MND) or an Environmental Impact Report (EIR), the public agency shall establish a mitigation monitoring or reporting program to ensure that all adopted mitigation measures are implemented. This Mitigation Monitoring Program (MMP) is intended to satisfy this requirement of the CEQA Guidelines as it relates to the 429 University Avenue project. This MMP would be used by City staff and mitigation monitoring personnel to ensure compliance with mitigation measures during project implementation. Mitigation measures identified in this MMP were developed in the Initial Study prepared for the proposed project. As noted above, the intent of the MMP is to ensure the effective implementation and enforcement of all adopted mitigation measures. The MMP will provide for monitoring of construction activities, as necessary, and in the field identification and resolution of environmental concerns. MITIGATION MONITORING PROGRAM DESCRIPTION The City of Palo Alto will coordinate monitoring activities and ensure appropriate documentation of mitigation measure implementation. The table below identifies each mitigation measure for the 429 University Avenue Project and the associated implementation, monitoring, timing and performance requirements. The MMP table presented on the following pages identifies: 1. the full text of each applicable mitigation measure; 2. the party or parties responsible for implementation and monitoring of each measure; 3. the timing of implementation of each mitigation measure including any ongoing monitoring requirements; and 4. performance criteria by which to ensure mitigation requirements have been met. Following completion of the monitoring and documentation process, the final monitoring results will recorded and incorporated into the project file maintained by the City's Department of Planning and Community Environment. It is noted that the mitigation measure numbering reflects the numbering used in the Initial Study prepared for the 429 University Avenue Project (Dudek 2014). 429 University Avenue Project Mitigation Monitoring Program Page 1 January 2015 DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 429 University Avenue Project Mitigation Monitoring Program No mitigation measures are required for the following resources: • Aesthetics • Agricultural Resources • Air Quality • Geology, Soils, and Seismicity • Greenhouse Gas Emissions • Hydrology and Water Quality • Land Use and Planning • Mineral Resources ■ Population and Housing • Public Services ■ Recreation • Utilities and Service Systems Implementation Monitoring Performance Mitigation Measure Responsibility Responsibility Timing Evaluation Criteria BIOLOGICAL RESOURCES Mitigation Measure BIO-1: The following measures shall be Applicant City of Palo Alto • Prior to issuance of • Approved site implemented to reduce impacts to protected trees: • City of Palo Alto (City) -approved Modified Type III fencing Urban Forestry Group/Planning demolition, grading, and building plans reflect applicable shall be installed for the two street trees to be retained along Division Arborist permits conditions University Avenue. City -approved tree protection signs shall be posted on all fencing. • During demolition, excavation, and • Field inspections conducted to • Soil conditions for the four new trees to be planted along Kipling Street shall be improved by preparing a planting area at least 6 feet square for each tree and installing Silva Cells to reduce compaction. The Silva Cells shall be filled with proper soil amendments and growing medium as determined by the construction verify adherence to conditions City Arborist. • Unless otherwise approved, each new tree shall be provided with 1,200 cubic feet of rootable soil area, utilizing Standard Drawing #604/513. Rootable soil is defined as compaction less than 90% over the area, not including sidewalk base areas. • Two bubbler drip irrigation units shall be installed for each new tree to adequately water the new planting area. • New sidewalk shall be installed such that the final planting space opening is at least 5 feet by 5 feet for each new tree. 429 University Avenue Project Mitigation Monitoring & Reporting Program Page 2 January 2015 DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 429 University Avenue Project Mitigation Monitoring Program Mitigation Measure Implementation Responsibility Monitoring Responsibility Timing Performance Evaluation Criteria • Kiva tree grates shall be used around each new tree. • Replacement tree size shall be a 36 -inch box, properly structured nursery stock. • Based on growth habit and proven performance, Ginkgo biloba "Autumn Gold" is highly recommended for the replacement trees. Other tree species may be approved by the City Arborist. • All work within the Tree Protection Zone, including canopy pruning of protected trees, shall be supervised by a Certified Arborist approved by the City. CULTURAL RESOURCES Mitigation Measure CUL-1: Prior to commencement of site clearing and project grading, the project applicant shall retain a qualified archaeologist to train construction personnel regarding how to recognize cultural resources (such as structural features, unusual amounts of bone or shell, artifacts, human remains, or architectural remains) that could be encountered during construction activities. If artifacts or unusual amounts of shell or bone or other items indicative of buried archaeological resources or human remains are encountered during earth disturbance associated with the proposed project, the on -site contractor shall immediately notify the City of Palo Alto (City) and the Native American Heritage Commission as appropriate. All soil -disturbing work shall be halted within 100 feet of the discovery until a qualified archaeologist, as defined by the California Environmental Quality Act (CEQA) Guidelines (14 CCR 15000 et seq.) and the City, completes a significance evaluation of the finds pursuant to Section 106 of the National Historic Preservation Act. Any human remains unearthed shall be treated in accordance with California Health and Safety Code, Section 7050.5, and California Public Resources Code, Sections 5097.94, 5097.98, and 5097.99, which include requirements to Applicant City of Palo Alto Prior to and during earth disturbance • Training materials provided to construction contractors •Field inspections conducted to verify compliance 429 University Avenue Project Mitigation Monitoring & Reporting Program Page 3 January 2015 DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 429 University Avenue Project Mitigation Monitoring Program Mitigation Measure Implementation Responsibility Monitoring Responsibility Timing Performance Evaluation Criteria notify the Santa Clara County Medical Examiner's office and consult with Native American representatives determined to be the Most Likely Descendants, as appointed by the Native American Heritage Commission. Identified cultural resources shall be recorded on State Department of Parks and Recreation Form 523 (archaeological sites). Mitigation measures prescribed by the Native American Heritage Commission, the Santa Clara County Medical Examiner's office, and any Native American representatives determined to be the Most Likely Descendants and required by the City shall be undertaken before construction activities are resumed. If disturbance of a project area cultural resource cannot be avoided, a mitigation program, including measures set forth in the City's Cultural Resources Management Program and in compliance with Sections 15064.5 and 15126.4 of the CEQA Guidelines, shall be implemented. HAZARDS AND HAZARDOUS MATERIALS Mitigation Measure HAZ-1: Prior to building demolition, the project applicant shall demonstrate to the satisfaction of the City of Palo Alto that a survey of the existing buildings has been conducted by a qualified environmental specialist who meets the requirements of the current U.S. Environmental Protection Agency regulations for suspected lead -containing materials (LCMs), including lead -based paint/coatings; asbestos containing materials (ACMs); and the presence of polychlorinated biphenyls (PCBs). Any demolition activities likely to disturb LCMs or ACMs shall be carried out by a contractor trained and qualified to conduct lead- or asbestos- related construction work. If found, LCMs and ACMs shall be disposed of in accordance with state and federal regulations, including the EPA's Asbestos National Emissions Standards for Hazardous Air Pollutants, the Cal -OSHA Construction Lead Standard (CCR Title 8, Section 1432.1), and California Department of Toxic Substances Control and EPA Applicant City of Palo Alto Department of Planning and Community Environment Prior to issuance of demolition permit and during demolition Building survey report submitted LCMs and ACMs handled by qualified contractor and disposed of in accordance with the U.S. Environmental Protection Agency's (EPA) Asbestos National Emissions Standards for Hazardous Air Pollutants, the California Occupational Health and Safety's 429 University Avenue Project Mitigation Monitoring & Reporting Program Page 4 January 2015 DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 429 University Avenue Project Mitigation Monitoring Program Mitigation Measure Implementation Responsibility Monitoring Responsibility Timing Performance Evaluation Criteria requirements for disposal of hazardous waste. If PCBs are found, these materials shall be managed in accordance with the Metallic Discards Act of 1991 (California Public Resources Code, Sections 42160-42185) and other state and federal guidelines and regulations. Demolition plans and contract specifications shall incorporate any necessary abatement measures in compliance with the Metallic Discards Act, particularly Section 42175, Materials Requiring Special Handling, for the removal of mercury switches, PCB -containing ballasts, and refrigerants. Construction Lead Standard (CCR Title 8, Section 1432.1), and California Department of Toxic Substances Control and EPA requirements for disposal of hazardous waste. PCBs, mercury and other hazardous building materials handled by qualified contractor and disposed of in accordance with applicable regulations as identified. NOISE Mitigation Measure NOI-1: Residential Uses: Window and exterior door assemblies with Sound Transmission Class (STC) rating up to 45 and upgraded exterior walls shall be used in the residential portion of the proposed building to achieve the City's maximum instantaneous noise guideline for residential uses. The City of Palo Alto shall ensure that these standards are met through review of building plans as a condition of project approval. Commercial Uses: Window and exterior door assemblies for the commercial portions of the building shall have a minimum STC rating of 32 at the corner of University Avenue and Kipling Street, and a minimum STC of 28 at all other commercial Applicant City of Palo Alto Department of Planning and Community Environment Prior to issuance of building permit Approved building plans shall include window sound transmission ratings and interior noise levels verification from a qualified acoustical consultant. 429 University Avenue Project Mitigation Monitoring & Reporting Program Page 5 January 2015 DocuSign Envelope ID: 930BD357-2699-4569-91C1-1551728AD75F 429 University Avenue Project Mitigation Monitoring Program Mitigation Measure Implementation Responsibility Monitoring Responsibility Timing Performance Evaluation Criteria locations within the proposed building to comply with the State of California CalGreen noise standards (maximum interior noise level of 50 dB during the peak hour of traffic). The City of Palo Alto shall ensure that these standards are met through review of building plans as a condition of project approval. Mitigation Measure NOI-2: The residential portion of the proposed building shall have a ventilation or air-conditioning system to provide a habitable interior environment when windows are closed. Applicant City of Palo Alto Department of Planning and Community Environment Prior to issuance of building permit Approved building plans shall include details of the residential ventilation system. Mitigation Measure NOI-3: Noise levels from rooftop equipment shall be reduced to meet the City of Palo Alto Noise Ordinance requirements. An enclosure or other sound- attenuation measures at the exhaust fans shall be provided to reduce rooftop equipment noise is no greater than 8 dB above the existing ambient level at potential future neighboring buildings to meet the property plane noise limit. Use of quieter equipment than assumed in this analysis may support reduced mitigation, which shall be evaluated by a qualified acoustical consultant. Applicant City of Palo Alto Department of Planning and Community Environment Prior to issuance of building permit Approved building plans shall include garage exhaust fan manufacturer's information regarding equipment noise levels and noise attenuation details TRANSPORTATION AND TRAFFIC Mitigation Measure TRANS -1: Mirrors shall be installed at the parking garage driveway to allow drivers to see when a pedestrian or vehicle is approaching in Lane 30. Applicant City of Palo Alto Department of Planning and Community Environment Prior to issuance of building permit Approved building plans shall include parking garage mirrors Mitigation Measure -TRANS -2: Mirrors shall be installed at each turn within the parking garage to provide adequate sight distance. Applicant City of Palo Alto Department of Planning and Community Environment Prior to issuance of building permit Approved building plans shall include parking garage mirrors 429 University Avenue Project Mitigation Monitoring & Reporting Program Page 6 January 2015 Docu • SECURED Certificate Of Completion Envelope Id: 930BD3572B99456991C11551728AD75F Subject: Please DocuSign: 429 University ROLUA FINAL.docx Source Envelope: Document Pages: 42 Supplemental Document Pages: 0 Certificate Pages: 2 AutoNav: Enabled Envelopeld Stamping: Enabled Time Zone: (UTC-08:00) Pacific Time (US & Canada) Signatures: 4 Initials: 0 Payments: 0 Status: Completed Envelope Originator: Yolanda Cervantes 250 Hamilton Ave Palo Alto , CA 94301 Yolanda.Cervantes@CityofPaloAlto.org IP Address: 12.220.157.20 Record Tracking Status: Original 4/21/2017 3:24:37 PM Holder: Yolanda Cervantes Yolanda.Cervantes@CityofPaloAlto.org Location: DocuSign Signer Events Signature Timestamp Jonathan Lait Jonathan.Lait@cityofpaloalto.org Asst. Director Planning and Comm Environment City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign ID: Albert Yang Albert.yang@cityofpaloalto.org Senior Deputy City Attorney City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign ID: Greg Scharff greg.scharff@cityofpaloalto.org Mayor City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign ID: Beth Minor beth.minor@cityofpaloalto.org City Clerk City of Palo Alto Security Level: Email, Account Authentication (None) Electronic Record and Signature Disclosure: Not Offered via DocuSign ID: CDocu Signed by: aA.A.,n C.,i4 293CF322E1294F6... Using IP Address: 12.220.157.20 CDocbSigned by arty- 61. 15B6C45220134DC... Using IP Address: 73.254.101.222 C1Docu Signed by: 6FB�� 3765F09D34EA... Using IP Address: 71.198.25.55 Signed using mobile CDocu Signed by. e4t, Minor 45F955o2DB71492 Using IP Address: 97.84.91.30 Signed using mobile Sent: 4/21/2017 3:27:20 PM Resent: 4/21/2017 3:33:33 PM Viewed: 4/21/2017 3:33:56 PM Signed: 4/21/2017 3:34:13 PM Sent: 4/21/2017 3:34:17 PM Viewed: 4/24/2017 8:55:46 AM Signed: 4/24/2017 8:56:17 AM Sent: 4/24/2017 8:56:20 AM Resent: 4/25/2017 10:47:36 AM Viewed: 4/24/2017 3:32:28 PM Signed: 4/25/2017 8:27:28 PM Sent: 4/25/2017 8:27:32 PM Viewed: 4/25/2017 9:37:47 PM Signed: 4/25/2017 9:39:10 PM 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 Notary Events Timestamp Envelope Summary Events Status Timestamps Envelope Sent Hashed/Encrypted 4/25/2017 8:27:32 PM Certified Delivered Security Checked 4/25/2017 9:37:47 PM Signing Complete Security Checked 4/25/2017 9:39:10 PM Completed Security Checked 4/25/2017 9:39:10 PM Payment Events Status Timestamps Legend Special Setback Frontages Park School abc Building Roof Outline Underlying Lot Line • lc Easement abc Lot Dimensions Zone Districts abc Zone District Labels City Jurisdictional Limits: !_ Palo Alto City Boundary • • Tree Project Site 429 University Avenue [18PLN-00240] This map is a product of the City of Palo Alto GIS 148' a peters. 2018-07-241225:00 (\\cc-maps\Encompass\Admin\Personal \Planning mdb) This document is a graphic representation only of best available sources. The City of Palo Alto assumes no responsibility for any errors 01989 to 2016 City of Palo Alto From: Lait, Jonathan To: Elizabeth Wong (elizabethwong2009@gmail.com) Subject: 429 University Avenue Date: Friday, October 12, 2018 5:01:26 PM Dear Elizabeth, I write in advance of issuing a Director's decision for the subject Architectural Review application. Following the Architectural Review Board's October 4, 2018 recommendation, I am prepared to partially approve the application with respect to the decorative element on the southern elevation and landscaping plan, and partially deny the application with respect to the exterior building materials, colors, and craftsmanship. As currently presented, the exterior materials, colors, and craftsmanship are not consistent with Architectural Review findings 2 and 3 (see below). However, I believe a few simple changes may be effective to address ARB's concerns and allow me to make the required findings. For example, the following changes would add textures, colors, and details more compatible with the highly ornamented character of the surrounding area: • Addition of sun shades or awnings along the University Ave frontage • Recessing the ground floor glass fagade by 18-24" on the University Avenue (with removed floor area added to second floor) • Adding texture to the exterior concrete on the first and second floors that recognizes the high level of detail on surrounding buildings. If you are amenable to incorporating some or all of these changes, I would seek recommendation of approval from the ARB on the updated design prior to issuing my decision. I believe the ARB's support is important for the ultimate success of your project. Please contact me by 650 329-2679 if you are interested in pursuing this path for your application. Jonathan Relevant ARB Findings Finding #2: The project has a unified and coherent design, that: a. creates an internal sense of order and desirable environment for occupants, visitors, and the general community, b. preserves, respects and integrates existing natural features that contribute positively to the site and the historic character including historic resources of the area when relevant, C. is consistent with the context -based design criteria of the applicable zone district, d. provides harmonious transitions in scale, mass and character to adjacent land uses and land use designations, e. enhances living conditions on the site (if it includes residential uses) and in adjacent residential areas. Finding #3: The design is of high aesthetic quality, using high quality, integrated materials and appropriate construction techniques, and incorporating textures, colors, and other details that are compatible with and enhance the surrounding area. Attachment G KASSOU N I LAW Via E -Mail and U.S. Mail November 13, 2018 Molly Stump Office of the City Attorney City of Palo Alto 250 Hamilton Ave. Palo Alto, CA 94301 Re: 429 University Ave., 14PLN-00222 Dear Ms. Stump: This firm represents Kipling Post, LP, the owner of 429 University Avenue (referred to as the Project). This letter is a follow-up to my prior letter of October 31, 2018 (which explained why Palo Alto has no discretion to shut down the Project based upon the Municipal Code section 18.77.090), and is submitted in support of the October 18, 2018 Administrative Appeal of Interim Director Jonathan Lait's decision to deny approval of the "exterior building materials, colors and craftsmanship -related detailing associated with the project." This letter sets forth the legal grounds compelling the City of Palo Alto's (City) grant of the appeal and approval of the Project. All prior correspondence, documents, photographs, Public Records Act responsive documents to this firm's prior requests, and comments from Kipling Post and its representatives are incorporated herein and deemed part of the record. As will be explained, the record over the last 18 months evidences an obvious disconnect between planning staff and the Architectural Review Board (ARB); inexplicable delays in having this minor project approval heard by the ARB; the failure of Interim Director Lait to even pay lip service to independent review of the ARB's routine denials (16 in a row); the failure of all involved to recognize that the City Council has already approved this Project with specific findings approving mass, scale, colors, and detailing; and the astonishing concessions of bias by members of the ARB, in particular Board Members Gooyer and Thompson. It is telling that Interim Director of Planning Lait recommended approval in his Staff Reports for all three Minor Level ARB reviews. Kipling Post had made changes for each ARB hearing and these were reviewed and accepted by the Planning Department. Attached as Exhibit A are the first two pages of the Staff Reports for the August 16, 2018, September 20, 2018, and October 4, 2018, Minor Level ARB hearings. The Staff Reports strongly show Kipling Post's full cooperation with the Planning Department, which earned Staff's recommendation for approval at each ARB. Kipling Post is not required to spend hundreds of thousands of dollars on yet another round of submissions before a biased ARB, after having already proposed three separate iterations for the ARB over three separate hearings, all of which were rejected without any commitment from Mr. 621 CAPITOL MALL, SUITE 2025 SACRAMENTO, CALIFORNIA 95814 TELEPHONE 916.930.0030 FACSIMILE 916.930.0033 1 Lait that an alternative would actually be approved. On this point, Interim Director Lait's Notice of Proposed Decision is grossly inaccurate when it accuses Kipling Post of a "refusal" to consider the "suggestion of incorporating detail into the design in an effort to secure complete project approval." Neither the ARB nor Interim Director Lait proposed specific changes that would result in approval. (Planning Department staff already requested ARB to recommend approval, to no avail.) In any event, Kipling Post is not required to go through a fourth post -City Council ARB hearing in front of members who have already evidenced their desire to fundamentally alter an approved modern design, at a cost of hundreds of thousands of dollars with no assurance of recommendation of approval. Kipling Post has been left with no option at this point but to pursue legal remedies in Court. Should the appeal be denied, Kipling Post will immediately file a Complaint against the City of Palo Alto. This legal action will compel issuance of the building permit, and will award Kipling Post all damages and attorney's fees attributable to the City of Palo Alto pursuant to C.C.P section 1094.5 and the Federal and State Constitutional Takings Clauses. This office is also investigating the liability of individual City of Palo Alto employees pursuant to 42 U.S.0 1983. Specific grounds are as follows: I. THE CITY HAS ALREADY APPROVED THE PROJECT'S GLASS, CONCRETE, AND STEEL DESIGN, AND MADE SPECIFIC FINDINGS REGARDING SIZE, SCALE, MASS, AND COMPATIBILITY WITH SURROUNDING AREAS The City Council approved this Project on February 6, 2017 (Approval No. 2017-2). Among other things, the City Council found the following: • "The project is compatible with the surrounding development based upon the building's size, scale and mass." • "The building's modern design blends and transitions with the surrounding buildings through similar materials and horizontal rooflines." • "The project is compatible with the immediate environment of the site." • "The design of the building offers a harmoniously compatible transition with the design character of the streetscape along University Avenue.... The project consists of rectilinear features in a glass and concrete style building. These features are consistent with the character of the surrounding buildings to the east of the site along university Avenue and the building is located at the corner of Kipling Street and University Avenue." • "The proposed project is consistent with the above finding because it corporates materials, textures, colors and details that are compatible with adjacent 2 structures and functions. Adjacent structures employ brick, stucco and glass windows with a rough texture and organic colors. The proposed structure consists of concrete, glass windows, and metal mesh screens. These features compliment the adjacent buildings and the third and fourth floor consist of a similarly colored concrete as nearby buildings." • "The project has a high aesthetic quality, materials, construction techniques, textures, colors and other details that are compatible with and enhance the surrounding area." • "The proposed structure is comprised of high quality glass, concrete and steel design which is similar and representative of the materials found in the surrounding environment. Further, the materials, textures, and attention to detail in the structure is consistent throughout each elevation which represents a high quality aesthetic design." These findings are consistent with the City Council's approval of the Option 1 design in 2017, in particular Sheet A.3.7, in which the materials are clearly specified. In short, the Project was already approved as a glass, concrete, and steel design. The only missing element from the City Council's approval of Option 1 was the decorative wall treatment for the Project's west elevation and the landscaping, both of which have been approved by Interim Director Lait and are not the subject of this appeal. II. THE PLANNING AND COMMUNITY ENVIRONMENT DEPARTMENT'S FINDINGS ARE IN DIRECT CONFLICT WITH THE CITY COUNCIL'S FINDINGS Not only has the City Council already made the above (and other) core findings, Planning Department staff has recommended approval of Kipling Post's submissions at every ARB hearing since the 2017 approval of this Project. Unfortunately, it is apparent that the staff reports were highly confusing to the ARB, as they set up mandated findings above and beyond the limited issue of "exterior building materials, colors and craftsmanship -related detailing associated with the project." This gave the ARB an erroneous belief that it could force the redesign of an approved project. For example, the staff report for the October 4, 2018, ARB hearing treated the matter as if the ARB were evaluating the Project for the first time, and thus erroneously mandated support for all the findings contained in Municipal Code section 18.76. Yet, as noted above, the ARB's role is limited to the issue of "exterior building materials, colors and craftsmanship -related detailing associated with the project." Interim Director Lait's October 16, 2018, correspondence to Project architect Peter Ko attached findings supporting denial of the Project. These findings illustrate the attempt by the Planning Department to force fundamental architectural design changes to an approved project. The 3 following are examples of the Planning Department's errant findings when contrasted with the City's previously approved findings: • "The building exterior is not compatible with its surroundings, however, because it fails to incorporate detail and craftsmanship in design that is similar to the surrounding buildings." [Compare with the City's approved finding that the Project incorporates "materials, textures, colors and details that are compatible with adjacent structures and functions."] • The proposed Project "uses exterior building materials (concrete) and colors (gray) that result in a design with little to no architectural detailing and no design linkages that reflect the overall pattern of buildings in the area." [Compare with the City's approved finding that the Project "has a high aesthetic quality, materials, construction techniques, textures, colors and other details that are compatible with and enhance the surrounding area." Lest there be any doubt that the Planning Department is seeking a redesign of the previously approved Project, its findings also contend that "comparably scaled buildings in the area" include details such as "Juliet balconies, faux balustrade screens in front of windows, recessed store fronts, awnings and recessed windows that enhance the pedestrian scale and experience." Yet the City Council has approved this Project as a "modern design" which "blends and transitions with the surrounding buildings through similar materials and horizontal rooflines." The detail proposed by architect Peter Ko is fully consistent with the design of a "modern building" as already approved by the City Council when it found that the "materials, textures, and attention to detail in the structure is consistent throughout each elevation which represents a high quality aesthetic design." "Detail" in architectural circles is commonly understood to be coterminous with "detail and craftsmanship in design." Thus, the City Council's previous finding of "high quality aesthetic design" does not grant the ARB or the Planning Department carte blanche for wholesale architectural revisions at the cost of hundreds of thousands of dollars to Kipling Post. III. TWO OF THE THREE VOTING MEMBERS OF THE ARB DISPLAYED OVERT BIAS AGAINST THE PROJECT AND COMPLETE DISREGARD FOR THE CITY COUNCIL'S FINDINGS A. ARB Member Gooyer The Planning Department's erroneous requirement that every finding in Municipal Code section 18.76 be addressed is inconsistent with the limited role of the ARB post -City Council approval of the Project on February 6, 2017. Thus several members of the ARB, in particular Mr. Gooyer, believed that the ARB was reviewing the Project from the ground up: "I voted against this project go -around. I have a hard time now saying, yes, you know, some very minor changes were made, but not enough for me to go from a negative vote to a positive vote. It's tough for me to now approve this project because of this." 4 This is a startling admission of bias by Mr. Gooyer, and discloses the necessity of Interim Director Lait's intervention and independent assessment (which he failed to do). Mr. Gooyer is admitting that because he was against this Project in general prior to the City Council approval in 2017, "it's tough for me to now approve this project." Mr. Gooyer further revealed his inherent bias when he remarked that he was only able to make a decision between two binary options (A or B): "If the proposal...is worded so that we're not discussing anything other than Option A or B, I can make a vote. Other than that, I would just vote no." He admitted he was unable (based upon his historical voting record) to assess the submission presented by Kipling Post, and recommended by staff. Again, Interim Director Lait should have -intervened when issuing his decision, but did nothing but parrot the ARB. B. ARB Member Thompson ARB member Thompson similarly failed to acknowledge the City Council's prior finding that the Project is "compatible with the surrounding development based upon the building's size, scale and mass." On the contrary, she expressly cited "massing" concerns as the first of her issues: "In terms of considering the context and the lines that are coming out of the context, I don't think that this massing actually works, even if, on its own, when you're not looking at the context it looks fine." Ms. Thomson contradicted the City Council's prior findings yet again by asserting a second "issue" with the Project, this time criticizing the "clean line building" when compared to the "detail in adjacent structures." Yet as noted in Section I, the City Council made several findings establishing the Project's compatibility with "surrounding buildings," "adjacent structures and functions," and the "surrounding environment." Significantly, Ms. Thomson expressed no clear preference for lighter or darker colors, noting that she could be "swayed either way for that." Ms. Thompson then proceeded to raise a third issue with the "scale" of the Project, despite the City Council's prior finding that the "[t]he project is compatible with the surrounding development based upon the building's size, scale and mass." Ms. Thompson erroneously asserted that "we can talk about scale, because I think that is related to the details....It is not compatible when it comes to scale." Ms. Thompson's confusion was the direct result of staff having imposed finding requirements unrelated to the limited issues on the table. C. ARB Chair Alexander Lew The third and only other voting member, Alexander Lew, has been on the ARB since the beginning and recommended approval. The ARB normally consists of five members. Recommendation of approval at a Minor level hearing takes two affirmative votes, 2 of 5 or 40%. Two members were recused for various reasons resulting in an approval threshold of 2 of 3 members or 67%. Nowhere in the ARB charter does it envision requiring such a high threshold. This 67% threshold is even higher than for a regular Major level ARB hearing which requires a threshold of 3 of 5 members or 60%. 5 There was no consideration given to this important imbalance by the Interim Planning Director in his decision. IV. PLANNING DEPARTMENT'S STONEWALLING APPLICANT'S REQUEST FOR ARB MINOR LEVEL HEARING The Applicant has diligently pursued obtaining a Building Permit since approval by City Council on February 6, 2017. Building plans were submitted to the Building Department for plan check on March 2, 2018. The ARB Minor level review is one of the Conditions of Approval. Applicant requested multiple times, by telephone and then continuously in writing as early as February 1, 2018, that the Planning Staff schedule such a hearing. An ARB Minor level hearing finally took place six months later, on August 16, 2018. These interminable delays by the Planning Staff ignoring Applicant's requests have caused costly delays to the Project, especially considering that the City's rules only allow construction excavation during the dry summer months. The scheduling delays have caused the Project to lose one year's window for in -ground work. The Applicant has otherwise obtained approval of the building plans from all other departments in the City except for Planning and contractor -related logistics issues from Public Works Engineering (The Public Works Engineering issues are normally resolved by a General Contracting firm, which will not commit to the Project without a final approval from Planning.) The list of Departmental approvals is shown in Exhibit B. V. MICHAEL HARBOUR'S COMMENTS AT THE ARB HEARINGS WERE WILDLY INACCURATE AND FURTHER REVEAL THE ATTEMPT TO REDESIGN THE PROJECT The comments of Michael Harbour at the hearings (a Project opponent from day one) did little to alleviate the confusion. Among other things, Mr. Harbour commented that the "mass and size is incompatible with the neighboring buildings, and it's not pedestrian friendly." As noted above, this had already been resolved in February, 2017, thus adding to the confusion initiated by the staff report. Indeed, Mr. Harbour is the only neighborhood resident whose comments were expressly referenced in the ARB staff report. Those written comments included the gross fabrication that Bellomo Architects had been "fired," and that it has disavowed the Project. It is apparent that Mr. Harbour's personal animus toward the Project has reached the level of the absurd. It is also apparent that Mr. Harbour has been utilizing Jodie Gerhardt as his personal pipeline for information regarding the Project. (See e-mail exchange between August 16, 2018 and August 23, 2018, Exhibit C.) It is telling that after this e-mail exchange, Ms. Gerhardt took the position on October 26, 2018, that any further approval extensions would have to be considered by City Attorney staff, in contradiction to her year -prior written communication on September 20, 2017, to Ko Architects that "[t]he Planning approval period is `stayed' during building permit review." (Exhibit D) A city cannot "deprive an individual of property rights by a plebiscite of neighbors. . Such action is arbitrary and unlawful." Ross v. City of Yorba Linda (1991) 1 Cal.App.4th 954, 968. 6 Notably, the Court reached its decision after it exhaustively canvassed the applicable case law. Id. at 967-968. While the Court recognized that a city council might consider the objections of neighbors, such objections are no substitute for the constitutional obligation to consider "what those objections are worth —not the mere fact that they are made." Id. at 966 (emphasis in original). In short, an exercise of approval power cannot be made to depend upon a "count of noses." Id., quoting Mettee v. County Commissioner of Howard County (1957) 212 Md. 357 [129 A.2d 136, 140.) (See also Hardin County v. Jost (1957) 897 S.W.2d 592, 595 ["[b]asing zoning decisions solely on the complaints of neighbors ignores the basic premise of planning and zoning..."].) VI. INTERIM DIRECTOR LAIT HAS DENIED PROJECT APPROVAL BASED UPON UNCONSTITUTIONALLY VAGUE STANDARDS IN VIOLATION OF FEDERAL AND STATE STATUTORY LAW It is a "fundamental rule in zoning...that an ordinance must establish a standard to operate uniformly and govern its administration and enforcement in all cases." Redwood City Co. of Jehovah's Witnesses v. City of Menlo Park (1959) 167 Ca1.App.2d 686, 697-98. An ordinance is invalid where it "leaves its interpretation, administration or enforcement to the ungoverned discretion" of the decision -making body. Id. Indeed, as the United States Supreme Court held in Papachristou v. City of Jacksonville (1972) 405 U.S. 156, 170, laws that permit and encourage "arbitrary and discriminatory enforcement" violate the Fourteenth Amendment. Id.; see also Yick Wo v. Hopkins (1886) 118 U.S. 356, 373 (An ordinance which clothes a government actor with unbridled discretion "hardly falls within the domain of law, and we are constrained to pronounce' it inoperative and void."). In Lakewood v. Plain Dealer Pub. Co. (1992) 486 U.S. 750, 769, the Supreme Court further held that even in limited circumstances where a law might constitutionally allow an administrator or agency to exercise discretion to protect "the health, safety or welfare of the public," such a law is unconstitutional if it does not place "explicit" textual limitations on the exercise of such discretion. Id. at 770. In Lakewood more specifically, the Court struck down a law that permitted the mayor to deny approval of newspaper stand permits if the mayor found the approval was "not in the public interest," because the law did not expressly limit or define what the mayor could determine to be in such "public interest." Id at 769. Like the laws at issue in the cases mentioned above, the ARB has been granted unfettered and limitless discretion to deny recommendation of Project approval with no accountability or adherence to objectively quantifiable standards, thus leaving the door open to arbitrary and discriminatory decisions. As even the City's former Planning Director Hillary Gitelman conceded at the May 4, 2015 City Council hearing, "compatibility is in the eyes of the beholder." Furthermore, this Project is subject to California's Housing Accountability Act (CHHA), in particular Government Code section 65589.5, subd. (h)(2), as there are three residential units in a City with a severe housing crisis. Neither the ARB nor Interim Director Lait articulated any specific adverse impact on public health or safety in support of the purely subjective, biased denial of the Project. The purpose of this statute is to limit the ability of local governments to 7 "reject or make infeasible housing developments ... without a thorough analysis of the economic, social, and environmental effects of the action...." (§ 65589.5, subd. (b).) Subdivision (j) of the statute provides that "[w]hen a proposed housing development project complies with applicable, objective general plan and zoning standards and criteria, including design review standards, in effect at the time that the housing development project's application is determined to be complete," a local agency which "proposes to disapprove the project ... shall base its decision regarding the proposed housing development project upon written findings supported by substantial evidence on the record that ... [¶] (1) [t]he housing development project would have a specific, adverse impact upon the public health or safety unless the project is disapproved" and "(2) [t]here is no feasible method to satisfactorily mitigate or avoid the adverse impact ... other than the disapproval of the housing development project...." Residential housing projects, such as that being proposed by Kipling Post, are expressly included in the CHAA as a "housing development project." (See Government Code § 65589.5, subd. (h)(2)(A)(C).) (See also Honchariw v. County of Stanislaus (2011) 200 Cal.App.4th 1066, 1073.) As such, the burden of proof shifts to the City to support denial with specific findings that approval would result in a "specific, adverse impact" on "public health or safety" Not only that, the phrase "specific, adverse impact" means a "significant, quantifiable, direct, and unavoidable impact, based on objective, identified written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete." (Government Code § 65589.5, subd. (j)(1). (Emphasis added.) No such findings were made, nor can such findings be made as the City has no objective, identified written public health or safety standards or policies that would warrant project denial. VII. THE CITY IS EXPOSING ITSELF TO LIABILITY FOR A TAKING AND CIVIL RIGHTS VIOLATIONS When governmental restrictions interfere with a property owner's "distinct investment -backed expectations" for developing property, the government generally must compensate for the loss. Kavanau v. Santa Monica Rent Control Bd. (1997) 16 Ca1.4th 761, 775; see also Penn Central Transportation Company v. New York City (1978) 438 U.S. 10. The First District Court of Appeal affirmed this Constitutional mandate in Lockaway Storage v. County of Alameda (2013) 216 Ca1.App.4th 161. There, the plaintiff had purchased a parcel of land for which the County had granted a Conditional Use Permit allowing the property to be used for storage of recreational vehicles and boats. Id. at 168. After the plaintiff purchased the property, however, the County refused to issue the permits that were necessary for the plaintiff to construct such a storage facility. The County justified its denials by claiming that the proposed construction would be "inconsistent with the County's [newly adopted] general plan." Id. at 171. Nonetheless, the Court still found a taking, in part, because the County's actions had denied the plaintiff its "reasonable investment backed expectation" that it could use the property as a storage facility. Id. at. 186. Please be further advised that Kipling Post will be entitled to damages for a temporary taking even if a building permit is ultimately issued.. In the Lockaway Storage case referenced above, of which the undersigned was counsel of record, several million dollars of damages and over $700,000 in attorney's fees were awarded the property owner for the wrongful delay in issuing 8 building permits. Individual Alameda County employees were also named as defendants in a civil rights action under 42 U.S.C. section 1983. That matter settled for $500,000. Similarly here, the ARB and Planning Department's perpetual delay in approving the Project has interfered with Kipling Post's "reasonable investment backed expectations." The denial of an investment backed expectation is ad hoc —a fact -specific inquiry that necessarily considers all circumstances surrounding the denial. Obeisance to the design whims of Michael Harbour, coupled with the astonishing lack of consideration of the City Council's prior findings, will only result in further depriving Kipling Post's investment backed expectations. CONCLUSION Especially tragic, after so many years of work and expense on this Project, is Interim Director Lait's refusal to intervene and restore some semblance of objectivity and discretion to the process. In particular, Board Member Gooyer's express concession of bias should have been enough for Mr. Lait to approve the "exterior building materials, colors and craftsmanship -related detailing associated with the project." It is clear that Mr. Lait will do nothing contrary to the ARB on this issue, regardless of the circumstances, and regardless of the express concessions of bias of ARB members. One wonders why the Municipal Code provision mandating the Director to approve or deny ARB recommendations even exists. We expect the City Council to grant the appeal and put the matter to rest. As you know from my prior correspondence, Kipling Post began construction activity and has spent inordinate time and expense in obtaining Project approval. This is evidenced by: • Retention of the Ko Architects firm to provide three separate sets of drawings to address three separate ARB hearings at great expense; • Completion of the removal of street trees pursuant to validly issued permits; • Payment of fees for new water service connections, fire service capacity, and water meters; • Removal of hazardous materials; • Archaeological services; • Disconnection of utilities to the site; • Eviction of tenants; • Preparation of construction documents; • CALGreen compliance; • Building permit fees ($186,871.77); 9 • Issuance of Encroachment Permit for installation of ground water level monitoring piezometer; • Hundreds of hours of work and hundred of thousands of dollars in expenses in obtaining Building Permit approval status from multiple departments as set forth in Exhibit B; and • Three ARB Minor level hearings Evidence of the above examples is attached as Exhibit E. To have this entire Project ground to halt because an ARB member just doesn't like it is arbitrary and capricious. I sincerely hope that you recognize the liability facing the City if, under these circumstances, the Project is denied. Accordingly, the City Council is urged to grant the appeal and approve Kipling Post's proposal for exterior building material, colors and craftsmanship - related detailing, which was recommended for approval by Planning Department staff in their ARB Staff Reports (Exhibit A). Thank you for your prompt attention. Sincerely, mo assouni cc [via e-mail]: Ed Shikada Jonathan Lait George Hoyt Brad Eggleston Rosemary Morse Peter Ko 10 Exhibit A Staff Reports to Minor Level Review ARB Architectural Review Board Staff Report (ID # 9470) CITY OF PA LO A LTO Report Type: Summary Title: Title: Action Items Meeting Date: 8/16/2018 429 University: Condition Compliance - West Wall, Landscaping, Materials (1st Formal) PUBLIC HEARING / QUASI-JUDICIAL. 429 University Avenue [18PLN-00240]: Recommendation on the Applicant's Request for Approval of a Minor Architectural Review Consistent With Condition of Approval #3, for a Previously Approved Mixed -Use Building (14PLN-00222), Requiring Architectural Review Board Approval for the Proposed West Elevation Wall Design, Landscape Details, and Exterior Building Materials, Colors, and Craftsmanship. Environmental Assessment: Use of Mitigated Negative Declaration Prepared for 14PLN-00222. Zoning District: CD-C(G)(P) (Downtown Commercial with Ground Floor and Pedestrian Shopping Overlay). For More Information Contact the Project Planner Adam Petersen at apetersen@m- group.us From: Jonathan Lait Recommendation Staff recommends the Architectural Review Board (ARB) take the following action(s): 1. Recommend approval of the proposed project to the Director of Planning and Community Environment based on findings and subject to conditions of approval. Background The subject project was reviewed and approved by the City. Council on February 6, 2017. Condition of Approval #3 in the attached Record of Land Use Action (Attachment G) requires the project to return to the ARB to evaluate three specific items. These items are: a. A decorative wall design treatment, feature or element, shall be applied to the exterior walls immediately adjacent to the southern property line (project's south elevation) City of Palo Alto Planning & Community Environment 2S0 Hamilton Avenue Palo Alto, CA 94301 (650) 329-2442 City of Palo Alto Planning & Community Environment Department Page 2 b. Landscape details and plans for all proposed planting, including individual planters, the greenwall, and landscaping near the rooftop elevator. c. The exterior building materials, colors and craftsmanship -related detailing associated with the project. The previous staff report from the February 6, 2017 hearing includes extensive background information, project analysis and evaluation against City Codes and Policies. The report, action minutes, transcript, and video of the meeting are available online: 1 Document Staff Report Action Minutes Transcript Video Lin https://www.citvofpa loalto.org/civicax/filebank/documents/55707 https://www.cit of aloalto.ore/civicax/filebank/documents/56154 https://www.citvofpaloalto.ore/civicax/filebank/documents/56868 http://midpenmedia.org/city-council-115/ Additionally, theproject returned to City Council on March 20, 2017 as an item on the consent calendar for adoption of the findings and the Record of Land Use Action (ROLUA). The report, action minutes, transcript and video of the meeting are available online: Document Staff Report Action Minutes Link https://www.citvofpaloalto.ore/civicaxlfiiebank/documents/56356 https://www.cityofpaloalto.org/civicax/filebank/documents/56839 Transcript https://www.cityofpaioaito.org/civicax/filebank/documents/57427 Video http://midpenmedia.ore/city-council-120/ Additional history is available on the City's project webpage at bit.ly/429University. A copy of the City Council staff report without prior attachments is available in Attachment D. The purpose of this report is to detail the applicant's response to the condition of approval, as part of a Minor Architectural Review application. Other minor changes to the project are being reviewed through the building permit process, as is the City's standard process. The analysis section below builds upon information contained in earlier reports and is modified to reflect recent project changes. Analysis1 1 The information provided in this section is based on analysis prepared by the report author prior to the public hearing. The Architectural Review Board in its review of the administrative record and based on public testimony may reach a different conclusion from that presented in this report and may choose to take an alternative action from the recommendation in this report. Packet Pg, CITY OF PAL O ALTO Architectural Review Board Staff Report (ID # 9555) Report Type; Action Items Meeting Date: 9/6/2018 Summary Title: 429 University: Condition Compliance - West Wall Landscaping, Materials (2nd Formal) ' PUBLIC HEARING / QUASI-JUDICIAL. 429 University Avenue [18PLN-00240]: Recommendation on the Applicant's Request for Approval of a Minor Architectural Review Consistent With Condition of Approval #3, for a Previously Approved Mixed;Use Building (14PLN-00222), Requiring Architectural Review Board Approval for the Proposed West Elevation Wall Design, Landscape Details, and Exterior Building Materials, Colors, and Craftsmanship. Environmental Assessment: Use of Mitigated Negative Declaration Prepared for 14PLN-00222. Zoning District: CD-C(G)(P) (Downtown Commercial with Ground Floor and Pedestrian Shopping Overlay). For More Information Contact the Project Planner Adam Petersen at apetersen@m- group.us From: Jonathan Lait Recommendation Staff recommends the Architectural Review Board (ARB) take the following action(s): 1. Recommend approval of the proposed project to the Director of Planning and Community Environment based on findings and subject to conditions of approval. Report Summary The subject project was previously reviewed by the ARB at the August 16, 2018 public hearing. The Municipal Code encourages the Director of Planning and Community Environment to make a decision on projects after two public hearings for Minor AR projects. Earlier staff reports include background information, project analysis and evaluation codes and policies; these reports uation of City Title: ports are available online; a copy of the August 16th. report without City of Palo Alto Planning & Community Environment 250 Hamilton Avenue Palo Alto, CA 94301 (650) 329-2442 City of Palo Alto Planning & Community Environment Department Page 2 prior attachments is available in Attachment H. Links to the full staff report and video of the meeting are provided below: Document . .. Link Staff Report https://www.cityofpaloalto.ore/civicax/filebank/documents/66300 Video http://midpen media.org/architectural-review-board-74-2-3-2-2-2-2-2-2-2- 2-2/ The purpose of this report is to restate the comments made by the Board and detail the applicant's response to those comments. The analysis section below builds upon the information contained in earlier reports and modified to reflect recent project changes. The ARB is encouraged to make a final recommendation to approve, conditionally approve or deny the project. Discussion) The ARB last considered this project on August 16, 2018. The Board expressed the following comments: �3. 7 ¢� 1 44 West Wall Plans: The ARB requested clarification about how the west wall design relates to the entire building. The motion referenced that the design include more detail and layering, and better relay the architect design intent of resembling a tree like structure. Y-i The proposed reveals have been revised to take the shape of an up -lifting tree -like pattern Craftsmanship: The ARB noted in their motion that the applicant should include construction details that demonstrate the craftsmanship of the building. Landscaping: The ARB expressed concerns about how the landscaping would look over time and that the garden wall planter along the rear alley Lane 30 may be overbearing. The applicant has provided photos and construction level details of the building showing the elevations, with building sections, and details for the roof, windows and doors. The applicant is proposing indigenous plant material in conformance with the ARB Findings. A detail of the proposed vine trellis is shown on Sheet L4. Staff has prepared Architectural Review Findings and Conditions of Approval contained in Attachments B and C. The project plans are available as Attachment .1 of this staff report and they are also available online at the following link: bit.ly/429University. ' The information provided in this section is based on analysis prepared by the report author prior to the public hearing. The Architectural Review Board in its review of the administrative record and based on public testimony may reach a different conclusion from that presented in this report and may choose to take an alternative action from the recommendation in this report. Packet Pg. 1D5:: Architectural Review Board Staff Report (ID # 9674) CITY OF PALO A LTO Report Type: Summary Title: Title: From: Action Items Meeting Date: 10/4/2018 429 University: Condition Compliance - West Wall, Landscaping, Materials (3rd Formal) PUBLIC HEARING / QUASI-JUDICIAL. 429 University Avenue [18PLN-00240]: Recommendation on the Applicant's Request for Approval of a Minor Architectural Review Consistent With Condition of Approval #3, for a Previously Approved Mixed -Use Building (14PLN-00222), Requiring Architectural Review Board Approval for the Proposed West Elevation Wall Design, Landscape Details, and Exterior Building Materials, Colors, and Craftsmanship. Environmental Assessment: Use of Mitigated Negative Dedaration Prepared for 14PLN-00222. Zoning District: CD-C(G)(P) (Downtown Commercial with Ground Floor and Pedestrian Shopping Overlay). For More Information Contact the Project Planner Adam Petersen at apetersen@m- group.us Jonathan Lait Recommendation Staff recommends the Architectural Review Board {ARB) take the following action(s): 1. Recommend approval of the proposed project to the Director of Planning and Community Environment based on findings and subject to conditions of approval. Report Summary The subject project was previously reviewed by the ARB at the August 16, 2018 public hearing. The project was then scheduled for the September 6, 2018 ARB hearing, but a quorum was not achieved for that meeting. Accordingly, the project was continued to the September 20, 2018 hearing. At the September 20th hearing, the ARB recommended the project return for a third hearing with the following changes. City of Palo Alto Planning & Community Environment 250 Hamilton Avenue Palo Alto, CA 94301 (650) 329-2442 Packet Pg. 55 City of Palo Alto Planning & Community Environment Department ARB Comments/Direction Building Colors. Lighten the two proposed grey colors. Ensure the color of overhangs relate tothe color of the wall it is shading. Landscaping. Provide additional landscaping on all floors, especially the 4th floor, to buffer uses and provide visual interest. Enhance the proposed green screen at rear of the building to provide additional support for vines. West Wall Design. The proposed design on the west wall needs to be better integrated with the rest of the building. Renderings Provide accurate renderings that include views from University Avenue, the corner of University and Kipling, and the rear of the building at a minimum. Page 2 Applicant Response, The applicant is proposing lighter colors and will provide an updated material board at the hearing. However, the applicant has some concerns that the colors will fade over time and become even lighter than the ARB desires. Grey overhangs will be provided on the third and fourth floors to match the wall color of these floors, as shown in the renderings. Additional planters have been added to the project, especially on the 4th floor where 16 rectangular pots will be secured to the roof just outside the railing on the upper floor. The green screen will be enhanced with trellis to further encourage vine growth at the rear of the buildings The applicant is proposing two options for the west wall as shown in the plan set. The first option is the same as was presented to the ARB on September 20th. The second option uses the proposed tan color on the top half of the 3rd and 4th floor west wall with the grey color on the bottom half of the wall to better integrate all four floors while providing interest on the west wall. The applicant has provided high quality renderings of the west wall from the vantage point of University Avenue to demonstrative how the west wall and 4th floor landscaping will be perceived from street level. Additional renderings may be available at the hearing. Earlier staff reports include background information, project analysis and evaluation of City codes and policies; these reports are available online. The staff report for the September 6, 2018 hearing, which was continued to September 20th, is available in Attachment J. Additional staff reports, project plans and other information may be found on the City's project webpage at bit.lv/429University Public Comment Packet Pg. 56 1 Exhibit B City of Palo Alto Approvals Itlq Task building Review Elect Utilities Review Fire Review • Planning Review • Publc. Works Eng. Review Water Quality Review WGW Utilities Review Landscape Revjv Urban Forestry Review Ready To Issue Pennit Issuance Structural Structural Architectural Mechanical/Plumbing Electdcai Structural Architectural Mechanical/Plumbing Electrical isoop-oom - KIPUNG POST LP Devs Building Review Elect Vilifies Review Fire Review a Planning Review • Pubic Works Eng. Review Water Quality Review WGW Utilities Review Landscape Review Urban Forestry Review Ready To Issue Permit issuance 18000-0053T - KIPLING POST LP Approved Approved With Conditions Approved Inspection Re.. Not Approved Not Approved Approved Inspection Re.. Approved With Conditions Not Required • App Approved Approved Approved APPrOVed Approved Approved Approved Approved Approved Status Approved Not Approved Not Approved Approved Approved 10/05/2018 DAVID CHU... 04/05/2018 DANIEL_ ER.. 06/29/2018 HENRY RAF... 09/17/2018 ADAM PETE... 09/26/2018 PAIGE SAF... 03/16/2018 BRIAN JON... 0 2018 JOHN NGLJY... 06/07/2018 KELSEY AN... 06/25/2018 WALTER PA.. 08/02/2018 MEDHAT HE... 07/13/2018 MEDHAT HE... 08/02/2018 DAVID CHU... 08/02/2018 DAVID CH14... 08/02/2018 DAVID CHU... 08/01/2018 DAVID CHU... 08/01/2018 DAVID CHU... 08/01/2918 DAVID CHU... 08/01/2018 DAVID CHU... Statz lam* 0 16/2018 09/17/2018 09/11/2018 GOPAL JAG... • ADAM PE... PAIGE SAF... 08/17/2018 JOHN NGUY... 07/25/2018 WALTER PA.. Exhibit C Gerhardt & Harbour Pipeline PALO ALTO Cervantes, Yolanda From: Gerhardt, Jodie <Jodie.Gerhardt@CityofPaloAlto.org> Sent: Thursday, August 23, 2018 11:11 AM To: Michael Harbour Cc: Lait, Jonathan; Adam Petersen; Yang, Albert Subject: 429 University - Building Permits Michael, The Planning Department, along with Building, discussed this issue and confirmed we will not be issuing Building permits until after Minor Architectural Review approval of the three (3) items/conditions (File No. 18PLN-00240). However, we are allowing the applicant to move forward with the demolition permit after the appropriate mitigation measures and logistics plan are in place/prepared. Sincerely, Jodie Gerhardt, AICP ( Manager of Current Planning I P&CE Department 250 Hamilton Avenue I Palo Alto, CA 94301 T: 650.329.2575 j E: iodie.gerhardt@cityofpaloalto.org From: Michael Harbour [mailto:dr.mharbour@gmail.com] Sent: Wednesday, August 22, 2018 8:53 PM To: Gerhardt, Jodie Subject: Re: Request to speak Hi Jodie, What was the status of your meeting with Jonathan Lait with regard to issuing a building permit before all council mandated items are approved? Could you please let me know? Thanks, Michael Harbour On Sat, Aug 18, 2018 at 12:08 PM, Michael Harbour <dr.mharbour@gmail.com> wrote: Hi Jodie, Thank you for speaking with me yesterday about the status of 429 University Ave project. You mentioned that you would be meeting with Jonathan Lait to discuss the next steps. Can you please email me and let me know the outcome of the meeting? The appellant's concerns remain with the design features of the building including wall design, landscaping, exterior building materials, colors, and craftsmanship. These were some of the issues on which we won our appeal under violation of municipal code 18.18.100. The city council's resolution on February 6, 2017 was clear that all of these items would need to be addressed and approved by the ARB before a building permit was issued. If the applicant was to begin the building before all items were resolved including demolishing existing buildings, it would give her a "vesting claim" to continue building the project without adhering to the council i mandate. The responsibility of submitting the design plans to the ARB lies solely with the applicant. It is not our fault that she exceeded her one year limit, applied for an extension, and then submitted her first proposal to the ARB more than 18 months after the city's resolution. The very fact that the ARB unanimously voted 3-0 against the current design plans is very significant at this stage of the process. We appreciate the planning department's respectful adherence to our issues which the council mandated. I look forward to hearing the outcome of your meeting. Thanks, Michael Harbour Lead appellant for 429 University Ave On Thu, Aug 16, 2018 at 7:57 PM, Michael Harbour <dr.mharbour@gmail.com> wrote: Thanks, Jodie, for your quick repsonse. I'll call you in the morning. Michael On Thu, Aug 16, 2018 at 7:56 PM, Gerhardt, Jodie <Jodie.Gerhardt@cityofpaloalto.org> wrote: Yes, I will be in tomorrow morning. Jodie Sent from my iPhone On Aug 16, 2018, at 7:50 PM, Michael Harbour <dr.mharbourga,gmail.com> wrote: Hi Jodie, I left you a voice message earlier today. Can you please call me tomorrow at (650) 224-4171. Thanks, Michael Harbour 2 Exhibit D Timeline Extension ABOUT THIS E-MAIL: The infomation transmitted may contain confidential andfor legally privileged material that is only for the person or entity to which it is addressed. Any review, retransmission. dissemination or other use of, or taking of any action in reliance upon, this information by persons or entities other than the Intended recipient is prohibited. It you received this in error, please contact the sender and delete the material immediately. From: Gerhardt, Jodie [mai(to:Jodie.Gerhardt@CityofPa(oAlto.org] Sent: Wednesday, September 20, 2017 3:45 PM To: Laura Roberts <laura@koarch.com>; Lait, Jonathan <Jonathan. Lait@CityofPaloAlto.org> Cc: Peter Ko <design@koarch.com>; 'Elizabeth Wong' <elizabethwong2009@gmail.com>; Reiqh, Russ <Russ.Reich@CityofPaloAlto.org > Subject: RE: 425-429 University Ave. Mixed use project timeline Laura, The Planning approval period is "stayed" during building permit review. Therefore, if you submit a building permit prior to the expiration and keep that building permit active, the Planning approval would not expire. However, if the building permit goes inactive, then the Planning approval would expire. <ImageUU1.jpg> Jodie Gerhardt, AICP I Manager of Current Planning I P&CE Department 250 Hamilton Avenue I Palo Alto, CA 94301 T: 650,329.2575 Is: Jodie.gerhardt@cityofpaloalto.org From: Laura Roberts [maiito:Iaura@koarch.com] Sent: Wednesday, September 20, 2017 2:1S PM To: Lait, Jonathan Cc: Gerhardt, Jodie; Peter Ko; 'Elizabeth Wong'; Reich, Russ Subject: RE: 425-429 University Ave. Mixed use protect timeline From: Gerhardt, Jodie <;iodie.Gerhardtc cityofDaloalto.orq> Date: Fri, Oct 26, 2018 at 4:48 PM Subject: RE: Request for Permit Time Extension To: Elizabeth Wong <elizabethwong2009@gmail:com>, Lait, Jonathan <Jonathan, Lait@cityofoaloalto.orq> Cc: Hoyt, George <George.Hoyt@cityofoaloalto.orq>, Peter Ko < n(a k desig oarch.cnn, <iaurai8 koarsh,com>, Andrew Wong <a jaitne.wongagmail.com>, Jaime Wong >' Laura Roberts <iandewong@gmail.com> Elizabeth, The City has already issued one extension for this project (see attached) which is allowed by the Zoning Code. ! will need to speak with our attorneys to better understand if a second extension is allowed. Sincerely, Jodie Gerhardt, AICP j Manager of Current Planning 1 P&CE Department 250 Hamilton Avenue 1 Palo Alto, CA 94301 T: 650.329.2575 1E: iodieszerhardtPcitvofoaloalto.org From: Elizabeth Wong [mailto:eliza_�. bethwona nn4n�►r+�;; , Sent: Friday, October 26, 2018 10:15 AM ,. To: Gerhardt, Jodie; Laic, Jonathan Cc: Hoyt, George; Peter Ko; Laura Roberts; Andrew Wong; Jaime Wong Subject: Re: Request for Permit Time Extension Jodie, Jonathan, Please email me form and instructions for extending the Building Permit deadline. Thank you. Elizabeth Wong 1 Exhibit E Construction Activity EXAMPLES OF COMMENCEMENT OF PROPOSED USE OF SITE 425-429-435-44.1-447 UNIVERSITY AVENUE, PALO ALTO DATE 6/7/2018 3/2/2018 5/7/2018 8/27/2018 8/29/2018 10/30/2018 7/25/2018 6/13/2018 9/1/2017 5/7/2018 9/5/2018 DESCRIPTION Completed Removal of Street Trees Building Permit Fees Paid fees for new water service connection, fire service capacity, and water meter Removal of Hazardous Materials Archaeological Services as required in Conditions of Approval Move Sewer Line in Lane 30 Disconnection of Utilities to Site Eviction of Tenants Preparation of Construction Documents CALGreen Compliance Installation of Piezometer and Ground Water Level Monitoring Completion Notice from JWH Asbestos Removal Services b EXHIBITS Tree Removal Permit and Fees Paid Submitted Construction Plans for Building Permit; Amount Paid $186,871.77 Receipts from City of Palo Alto Utilities Department Executed Contract with Holman & Associates Contract with Able Septic Tank Service Termination of Service and Declaration Concerning Tenancy Court Stipulation and Order for removal of the last tenant by July 15, 2018 Contract acknowledgement letter and Timeline from Ko Architects Contract for Cal Green Tier 2 and Cal Green Consulting Services Enncroachment Permit and Temporary Lease by Exploration Geoservices Inc. City of Palo Alto Public Works Engineerits Ph one:6ZOF329-21si FAX:450/329- 4o Inspection; 65Uh396-6929 PERMIT TYP If ' f ? SAC. NT PERMIT (Right-of-way or pidgin utilities easement �w LEASE (Iraor uteazcraa°hmeaisj oachments on City -owned property) PERMIT NAME AND ADDRESS: LOCA.T1ON OF NCROAcL"MIE:V1lLEeSSE: AUG 2018 ENCROACHMENT PERMIT • ? ' TEMPORARY. LEA F ' ' IEN C RoACl p 'T TYPE: . n Residehti fi ftRFh putit ..» standard: Arnbitectu al, strua (PUE) or City ng.ht-of 1vay (RO etc. in a Public Utilities Easement _.__ ester or container (no insurance certificate is required). _____ Pence: Placement of a fence in a ME or ROW (no his:ge me+ certificate is rcqutr•ro) ° ____ Standard: Awnings, Iai10 or�sidewalk cI 6 structural or arcruteetvrai features, �te sttructures ian otther ioonn term erteroaohutenta in a YOE ar ROW, tasting more than S days. g corm I Short -Term: Sidowaludatreettelicy o=ncroa unloading ofmaterials. etc, tasting da s o ir lle sox dca'alk closures, ___„ I Days: Sidewalk ar lane closure lash 1 day or less. ___ 2vIraor: Me ese:lent of� er with;, downtown districts (;additional fee for pad`g Rade. if apt able), and restaurant tables Pursuant hereby requested provisions of Sec l riles r, Co chairs on s ested to construct and maintah an eat Palo Alto Municipal o zo u Coda, tramepermission is 1 at the above location and in themaunet' described bellooimont, or ro v. Caty�_aunted `P ': NATURE OF FIVCROA,C NT OR USE: '±ekt-- �' `�+.rt,..iA2.604 f REASON FOR ENCROACE ENTLLRASE: Ma fl , -ors r -- r- . n 4y77' i4la li TOTAL $ Date Paid: 1 Ternpoa tid i ry DaDays) S TED ESTIMA 1-107V1,97.4117 LIS. ONLY FEES: r� ps i Fee Paid 1' A, J.) {k 011 Parking RTIS CERT #: I- REVIJ WF.DAND RECOAfiiri tn.FOR APPROVAL BY: r Transportation -f $ldg Inspection Phoning .j Real Estate Light dt Poorer WOW 1'erttuttee�,ttlt atPcaati tee expense, . ::' . 139ttni thirty co days at e n ,reapnovcs:'. �p --. -. •.- u to hin thi ty e d yaci rnoncefam " ° Cyt.Bmi o , eat er me C+ pH 'rliasnKR tut�:d, h rFttFcnrlin�pr�t=eraent� tiiqFbiu tree. e�Rr.�Pra �tv ��g trnh� due ..., raFe q ▪ Palo Alto City; and cost thereof made a Tien �et t p� a e removed, �tm tha et o :a' Fu e �+ty; and the spect* e 1'ed, she prawn= � or�eut . pursuant to the pro��astons aySeQ 1? �e�cncx a' considcratroa.u.ficit isyttat,ce Oasis •l�oflite3 er .nhue w that i� ° earnes to �r evid of lia . pp Cttttseti an oie q° m pa the Cite' ofPalo AIm to its o cars, agents, anti lo, �, the ouoma audaoaazed or lU� of or xn Frt th for Faze1 ie of tr this P tliease e,ermine a ucr dna ectett vatth n( . Zs from any tiabzlit5' of Peaatittee snail be resDo Ste' stnct ttrtderstaF+ds + o ratioa>5, struaitves or prof rtv atullt�r use. ! far obtain. ]Fa£ Eizis Iaeraxut e� above, nothing contatnealtamin snail obligate City tot -issue artypegnits Orip-pyroervii: regiu k a for construction.p° Noitstibtain. n and ail permits a�bioll mix r.. ,.e...__-- , • arts tta estate. y an Ageo Iyhavinplur— uz-ulkon -AN II, Permjttee hereby ac IE andagr thetali o t ni interest e oc ca For imp/Wien ti, subjeot to all con 'bops sett f�1 end t a visions shah bts bra shall ox a ::. ,a o on etrrFttteathe pc&, hment, trot, or by the antics : start daatte ldiment pie APPROM by "--- Pe Be Wortcs Inspector at tees)s6-92s _Provirye _:_ issuance s:Ipwatta.noroitusencroaormaratifaaroachnieraparnatFonn.ctee As eppitcakte Red Special Prvvisiortsaadconditions, assigns, n�n �ccess era Ian \: \___ Reif tacatto ate APPROVED URBAN FORESTRY SECTION TREE PERMIT FOR RCG UL..1 ; " PU$UC WORKS �"� C e T e' OF Public Servkaes Division • Urban Forestry ALTO PALO ALTO PROJECT ADO ISS 429 Unjivierlity APPLICANT INPORNAION. Nano: itCCt8.Inc. Address: • IRE-__.__. _ t&3OO.OIft $0 Phone: (650) 853-1908 cat Fax t:° it. deaitglgP com SCOPE Ora WORK F f /W' CescrtpEbn Species value I. R2 Remove meet tree inventoried at 1 Climb $173044"e'tJ,�'SnWty. site RZ R1 .RCtu'tii anutreet treniatentadetat cep 447 University. site Ri R1 __.. $1750 35 40 Dist. From Left Prop. tine 100 Ast4 saw Soctoectsconling Cain to building permit sheet Ll �° Ar**.atton Date: t0 [i t $ Start Date: 613 J ttRIGUIRRD ATIIACNININTS 1. sae Plan 2. Olher: PERMIT COMMONS I. The perrMtted work ths$ co doe* to Chy of P.lo Alto standard apedfkadons and the Nee AeeAneeei Manus, including those chudad above. See attached specifications 2. Permit shoe be mailable on site during work. 3. Pennine, removing bras and slumps, and/or planting new trees shill use PW Detail 8604. 4. Permitter Is responsible to note* Underground Service Alert (USA) frier t0 stump ranwnsl and replacement tree pl ntIng. /48 work shell be completed by a licensed trim se p lannicePingboribeiceor 8. New tree shah be MsPseted by uibar! �Y inspector prior to installation (8S0.4S18..5853) 7. When required. tnlgetion bubbler hails shall be suppMsd 1D each new tree per PW NUS *Sp. 8. Applications dit bok.de pruning or femoral of regulated trees must attach a report from a certified aphorist 9. 8, consideration of the granbnq of this pennkk for pruning an h*Irnalional Socettyr of Arboriculture Certified Aphorist crest be en is AM work shall be dab in socordsnoe with: • Palo Alto Municipal Cods Tide 8. Tows and Vegetation • Tree TechMgl Manual, lM1NC 8301130 • American National Stands dr institute (ANSO Standards for Ti.. Care Operations A300 4 Z133 • ANSI Standard for Nursery Stoke M t • Underground Service Alert (UM) nothicMron requirements • Proof of insurance as seedbed by the City of Polo Alto • Scope of work must completed 10 Addltionel Conditions s de TBD Completion Date: ZO Pennines Ohms that di workdescribed hawin facts stated herein with a► ant trueinaand Mem that who. fib or her agents, employees, and conbatt rs shall perms abide with the Permit Conditions outlined above and hold the efinatiOna of the iciity of Pero es.ta. The pandas* to from at costs and okt► Paso Altos its officers officials. atones. !employees harmless at any time de" 11e�s which might arras frown the PW.wtn..ti use or occupancy of pubic right stirs (A),- TE PERMIT ISSUER DATE Permit may be revoked 6 !i Ii y) .^1`"CC'+w<nNWW40RAMh.:t tmo...KYVAV..MI•.C4 * W.S '#.'Q :•�_rlR:v..: :,...yyM �.Ya".a:!'� _.e ... -...•,•-&.,s.:t",,r...cv+.+...mWr;.+.:..sM1�irw-w rTt 1. i.w/y...MAM.iralni } f 1 CITY OF PALO ALTO DEVELOPMENT CENTER 285 HAMILTON AVENUE PALO ALTO, CA 94301 (650) 329-2496 OWNER: IUPLING POST LP CONTRACTOR: PROPERTY ADDRESS: 429 UNIVERSITY AV RECEIPT NUMBER: 334699 RECEIPT DATE: 3/2/2018 9:53:31AM PERMIT NUMBER: 18000-00536 FEE DESCRIPTION] Landscape Plan Check - Commercial & Multi -Family Buildina Plan Check Fee Utilit:es Plan Check Public Works Plan Check Fee Fire Plan Check - Commercial & Multi -Family Zoning Pien Check Fee Cheek Print Date: 03/02/2018 Type: Project Seb-Type: Building Permit Category: Building Permit SUBFUND-ACTIVITY 65060001 1337 65030001 1337 65030001 1337 65040001 1337 65050001 1337 65020001 1323 ~� Fees paid include a Technology Surcharge of 1.8%per transaction approved in FY 18 Municipal Fee Schedule Comment: UNITS 1 1 1 1 1 FEE AMOUNT 51973.00 $66627.98 $118.00 $39,088.12 $47,9711.773 Amount Duet Agiount Paid: 531,092.94 $186,871.77 8186,871.77 duck.* btg 20170818 an* of Paxa Ell UTtLITMESl Billing Address: KIPLPI(G POST LP P. O: Sox 204 Palo Alto CA 94301 Servlc. Address: 429 Unimak Av Palo Alto CA 94301 City of Palo Alto 250 Hamilton Ave. Palo Alto, California 04301 so 13slss 4tdsr/ Dasta*Von /Ref. Service Order .. • Invoke Number : 95019717 Wok* Dar) : 05/07/2018 Customer No : 2 551 OF DC1NEPARTMENT W.G-WZN • BILLI Tt AMOVNT HOOD FOR 90 DAYS DIMINPULL sotr Amount 000010 000020 000030 70041156 40023443 70041155 40023443 70041155 40029443 NEW f WATER SERVICE CONNECTION r FIRE SERVICE CAPACITY FEES 518° WATER METER INSTL CHARGE $137.00 22.530.00 898.00 Total Dus $ won Remit Payment to: t4ail: Revenue Collections -City of Palo Alto P.O. Box 10230 Palo Alto, CA 94303 In person: Revenue Collections, 250 80ai3ton Ave., 1st Floor, Palo, Alto, Ch 94301 for Billing Contact: snail: kelly.harntadaityofpsloalto.org huts invoice amount is (6501 617-3106 This in- god until 90 days after the effective date of the next +approved -rate increase. If you have not paid the aaount due within that tine, a new fnvaias will be prepared and nailed to you. The new invoice will be pied using tbe rates in effect at the time of mailing. ity of P4,14-*Mte ;ity of Palo Alto tevenue Collection Reference Neer: 2018128002-68 Bate/Time: 05/08/2018 1:54:55 PM S D Pro -Forma Payment 2018128002- -1 S D Pro -Forma Payment Contract Account: 000010006981 Last Name: P First Name `KIPLING POST Amount: Total: 1 ITEM TOTAL: TOTAL: Check Check Nbr: 04672 $31,365.00 Total City of Palo Alto 250 Hamilton Ave. elo Alto, California 04301 $31,365.00 $31,365.00 $31,365.00 $31,365.00 $31,365.00 19)1111011001111,11,1 Customer COPY 7Oel3?-7(Y Invoice Number : 95019717 Invoice Dab : 05107/2018 Customer No : 20002551 c to'Alo°ALT�; ....... UTILITIES DEPARTMENT W-G-WENGINERING BILLING AMOUNT GOOD FOR 90 DAYS IPANTIALIPATMZWISNOTACCOMOb t1on SERVICE CONNECTION CAPACITY FEES ER INSTL CHARGE Amount • 8.137.00 22530.00 698.00 Total Due $ =Ma Resit Payaent to: Moil: Revenue Collections -City of Palo Alto P.O. Box 10250 Palo Alto, CA 94303 In person: Revenue Collections, 250 Hamilton Ave., 1st Floor, Palo, Alto, CA 94301 Par Milling Contact: email: kelly.haruta6oityofpaloalto.orq phone: (650) 617-3106 This invoice amount is good until 90 days after the effective date of the next Council -approved rate increase. If you have not paid the amount due within that time, * new invoice will be prepared and availed to you. The new invoice will be pied using the rates in effect at the time of mailing. %" 1 13) I Nh Oi PAti M30 UTIUTIBS, Sabtp Ad in= KIPLNG POST LP P. O. Sox 204 Palo Alp CA 94301 Service Add 420 University Ave PabAlb CA 84301 Neon No A1aE. 000010 Sibs *Wert Sunibe Order 70041276 40023470 Ckof Pro Alto 260 tftly t Ave. Palo Ate, California 94301 awake Number : 05019723 invoice Date :Customer : 00/0 1112018 18 No Contract Account : 1000000/ Daserlption NEW 8 WATER SERVICE CONNECTION gcto3y13o 1.332.00 Total Due $ Inaag Itemit Payment to: Lail: Cellaatioaa+City of Palo Alto P.O. box 10250 Palo Alto, G 94303 In versos: bevemme Co11aatie:ga. 250 Naailtoa Asa. , lit floor, Palo For Billing Contact: email: kally. hazolal Ltyofpaloslts. osy • Alto, Ch S Ol pia: (150) 117-3i0d This in voice amount is good until 90 days after the effaota,,e date of the seat s; new + Z�b isam4W. if you have sot paid the must ,der within that time. UL3 np the stare in efface t Hof # °xO�`�' will be propexed %t J e !► M s H a Asbes Lion REMOVAL SERVICES CSLB No. 777430 OSHA No. 270 COMPLETION NOTICE This is to certify that J.W.H. Asbestos Removal Services has completed the removal of the asbestos contracted per HMA Asbestos Survey #18.240 dated July 27, 2018 Removal and disposal of 1,600 sq ft of sheetrock/joint compound less than 1% non -friable asbestos from tower walls on sides and back wall and 2 upper walls in Unit#425. Removal and disposal of 120 sq. ft. VAT tile and masdc and tape on flue pipe in Unit#441. Removal and disposal of asbestos tape on plenum box in Unit#447. Removal and disposal of carpet, floor tile and mastic on wood, transite flue pipe and asbestos tape on metal pipe in Unft#450. at the following job location: 425,441,447 University Ave, Palo Alto, CA 94301 450 Kipling Street, Palo Alto, CA 94301 In accordance with J.W.H. Asbestos Removal Services proposal signed/dated August 6, 2018. This notice conforms to and is in strict compliance with all applicable standards and regulations. This provision of completion is our acknowledgment by authorized signature that all services that have been contracted for are completed as specified at the above referenced property location. W. Howell .H. Asbestos Removal Services August 27, 2018 Date 710 E. McGlincy Lane 1111, Campbell, CA 95008 Tel: 408-374-1123 Fax: 408-374-1091 boLmyjssocus ARchaeoltc ical Consultants "SINGE THE UOINNIN0" 3.515 FOLSOM ST. SAN FRANCISCO, CALIFORNIA 94110 41S/SSo-? Elizabeth Wong Steleco LLC POBox 2014 Palo Alto, CA 94302 29 August 2018 re: for a Avernra. 10 jag 425.429 U. Thank you for contacting us regarding an archaeological and historical resources .Mitigation Measrequiring training for construdjon pew for your Project at 425429 University Avenue o .Ato. A adverselyredevelopment project proposed for the property will require excavations about 30 feet deep, which would historical or archaeological resources, if any, therefore the City has required this The Scope of Services for this work will be to provide a training. cultural resources ... that could be encountered ��g session ..,regarding how to recognize CUL- 1 (attached). Such a training session would during construction activities" as per Mitigation � at the jobsite. Potential attendees would betypically talcs 45 minutes to one hour and would be conducted Our fee for these services will be determined � you and your ��, s) which of our staff is used, and could be less if we can coordinate the training ► depending °n vicinity that same day. Any additional work or site visits would be charged with other work hourly rates f $ in the for Senior �(� ss)), S85/hr for Staff Archaeologist(s), eologist(s), or $80/b r f Archaeological Technician(s),� barge up to 100 mules. What we need from you i. Notice at least one week before the training, specifying time and plane. 2. Authorization to Proceed. Please sign and return an original of this Proposal to serve as A to pay Invoices within 30 uthorixation to Proceed and as dement to pay Invoices or n 30nd youras of receipt. A signed digital copy will suffice, or you may fax a signed copy standard contract/authorization with this Proposal as an exhibit. Please call Miley or email Holman. Assocecomcast,net or meat 650-726-6269 or nuccmseconrcastnet if you have any questions. Cordially yours, Matthew R. Clark, RPA Senior Associate E.Wonn re 425 Usive city Ado Alto Archaeological Training. 28 August 2018, tie 2 of 2 AuthriFingName , tor Mir• Title Cor eny/Agency sivierco Total Contract price: kagM+ 5O Project: H&A 08-06/18 IiMgiMion Measure CUb,.1: Prkw to commencement of site abating and project grading, the project applaud shed roue a quadhled archasologlstto train aansinsolion personnel regrading h #eel s ecognize ova rwomes or as anrourks etbone a abet, artifacts, remains,uman or ardidedural remains) 'het could be encountered during oontb'uclon aciYlies. If and** or unusual amounts Oohed or bone or ober dorm Indicative of buried aardhredo6lad beams' or human remains are enco untered daring eadh delftware modeled wilt the proposed project, Ihe oontracior shall knreedkdely notify ete City of Palo Alb (City) smiths Naive American ilediage baCoted lu&un n a s10appropriate. AN work .lad be quelled archaeologist, as defined byernia aEn Quality A it (CEQA) addslnes (14 CCR HOOPatseq) and e. a*,eas,1055a IlignIficened evaluation, et the Inds pursuant to $salon 106 ofthe Nalionsi Historic Preservation M. Any human remains unsardnd shall be tested In acoon Mno. wilt California Hub and Oats* Code, Salton 7050.5, and CaliforniaPublic Resources Code, Sections 6097. 44, 5097J$, and 5007.9l, which include erne b • consult wilt Nam American reprpeptMl es determined to be the Most Likely Desoendents, ea appointed by the M ore Me dian Heritage Commission. 'dandled shag be recorded en eb b wawa" resource s I Recreation Don n 523 0f and measures prescribed by** Reeve American Hedges, Commission, fee Sark' Clara oak' eon orey N otes_ American tlw be the Most Uirely yeerrendenie and require d by be Cily shall erh s determine d to be un dertaken Wore oonsivollon addles are resumed. if dielurbanos o f. pruject an* bawd resource cor net be ihr• City's Cultural Resourc e, M anagement Program ensign aomplan wtih Sections 16064. 6 and 16126.4 Mlle CEQA Guidelines, shd be implemented. City dPalo Alto- Prior end ,Training provided� won contactors • Reklinepeagone conducted to verify compliance licit 671444 PROJECT: Customer: Oeve*oer iteleco Attn: eft;Wong_ Ave_ _ __....._...._ACA _ _ ._._.._. _..._.. 650.143011 OknNt: r,m.iHf't!iuc:ri;42 '•45'>�rr -sn;i ii, • • • • • • • • • • Excludes .. • 1 1020 Ruff* Sat Jaya C* Nno Owc.ROW 3774W0 Fat (40Ii 4Pl.11Qe i�V�7IAR... Misc. plate $W30,201$ � AM�1s4>�n Hardesty Review SCOPE OF WORK: Install a ew manhole in the street and a sewer lateral with on -sits Install, per City permits. Able to mark out the construction area 46 hours prior to any Able topuN the permH* needed to comptets this project (permit cost excluded). Able to set up traffic control, lay out trench line and saw cut asphalt before digging. Able to dt are chwith install or sewer lateral approx. to 2 ' in ienges and approx. 8' deep. Able ID backlit, haul ell proper materials and compaction to be mechanical. is related to this job. Able to use proper shoring on all benches 5' or deeper. Able to pave around newly kistalled manhole and new sewer lateral. Able to replace small section of driveway approach. Able to reconnect 4 exhtkng sourer lines that are be be reconnected to our new sewer line. 4611/ Able to install one new sewer manhole to City of PA specs. Able to use native beckfHN on the on•site sewer and replace the concrete, to 8" thick then the trench line only. Compaction to be mechanical. Able to dig, trench and instill a 6" sewer line approx. 115' in length and approx. 8' Ws are estimating project to take 5 to 6 working days to complete. P• Able to provide traffic control p'an. to Bust men t ofo. a submission t^ the -:. ,,r. Ah:e .t, pros cle certificate of ins. With customer pravicte0 additional insureris ,upon signing C.>f he proposal. Perinite. OM Ord If needed. Soon "d di jai-• Any concrete thicker that 6". Is ; nrludEi:. Any utilities that will cause use to hand dig through our trench line. This bid is for tractor work. Hitting any unmarked utbtges lines in our bench area. Reese note. we have excluded the cost to abandon the existing line until we get fin. Rack arid Oroymd Water Clem may be rock/gr unedd �l found, alternate methods may be applicable. if found, additional charges g+.altlgunkee Any alterations or deviations from tits proposal. involving additional matsdats sndlor labor MN be =oersted only in a written charge order and w10 became an additional charge out rte the original proper cast. Any additional down time created by a change ceder win be payable by the customer per our standard time and materials rip. Thank you forgiving us the oPoortunite to bid on yourlandergrOUnd rfiroloct i THANK YOU P01? CHOOSING ABLE UNDERGROUND CONSTRUCTION Punted • Bennie - Stow . SPA= . ,yaw • Ecomo & IAlslitd Sop& Spataariv Cas+paec • xn0aaor . allaiml -1•Wecal Iftiabliv SOW & gnaw troth CeetCirtj; • %UN., . tip: . aAp p aftwavaia d tomtit SvpreSow Strom- 5note � Colmircirt Mod) Li t ,f. s lAosfra O aietp sow. Stunt+. • Pubst• *two . Doom & Spitmapvied palter: hrkw�: freoicaorr • .1 ::x:4r tC . AMMO'Ahem Ca lat, Z•Ult Apowppe.Soft* :ter/tr. -rt o:st1 t; 4-.. rc> t.; wvv re.:.bladackstatf: 4r. coer. • Wirer, ya:i.Pcoll or.40. goo CITY OF PALO ALTO 1111\f. �..�T!Lr rIESS Inspired by a brighter tomorrow. DEMO DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Street # (f3 Street Name VNiVEEL.A 1 g P Palo Alto Municipal code 16.04.060 section 105.1.3 provides no work or demolition shall begin upon any portion of such a unit until each and every portion has been vacated by all tenants lawfully in possession thereof. 1 ) t?.40.1DeJ h K!a hereby declare that 1 am the owner, or owner's agent. g nt, of the premises located at the servic address listed above. 1 also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise Consists of 1 number of buildings 1 will not use not use any demolition permit issued to aid in securing vacation of said promise. 1 certify under penalty or perjury that the foregoing is true and correct. 511241i1)6 Gvonj, fl4na5tr- Print Nayx� J Signature (off—eflt, -3a1-/ Phone Number City of Palo Alto Utilities. Customer Service Center 250 HamOton Ave., Ground Floor, Palo Alto. CA 94301 Tel. 650 329-2181 Fax. 850-321-2786 Hours Mon - Thur 7:30 am to 5:30 pm Friday 8:00 to 5:00 pm Email: UtnitiesCustornerSetvipei citvobpe oaito.orp Web: din./lwww.c Rev 12/2/2016 DEMO UTILITIES Utilities Disconnection Prior Inspired by a brighter tomorrow. To Building Demolition/Remodeling Affi Service Address 4°2( tilVt gar API t P7 (.1,iai ver, , Ave.& 14,14 All addresses on the property being demolished need to be listed. A is reiluined for each address. separate Demo application 0 Single Family Dwelling 0 Multi Family Dwelling XCommercial Building Applicant Naito' tx' I Z eA ruD Owner Name Rot uG-- P� - Lr M is — Phone ' - &1'i -, Qr I r� -� Phone —47 V-3 1 ll Billing Address n. fifyG ZO40 Ps..(0 44413 Cao�. R �3aa. Email Address eh ?.itkb,e, SAG .24::0 @, 1 M ai 1. GO S.ervices R nested for Removal Check all a 1 licable boxes ove Electric Service Line Remove Gas Service Line Utilities will be disconnected and/or removed within 1 and 10 working days after receipt of a completed application. Exact times and/or dates cannot be scheduled. If uti be reinstalled, a connection fee will be charged per current utility rate schedule. Signature (Applica Date General Information Will there be multiple or new address(s) when construction is complete? Will you need temporary power during construction? Have you applied for a building permit? Will the foundation be removed? No No No ..._ No What is the purposed property use after demolition? (Example: single family home, restaurant) City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor. Palo Alto, CA 84301 Tel, 650 3294181 Fax. 650417-3142 Hours Mon — Thor 7:30 am to 5:30 prn FrErnst liltlitemensignighasayabaneura iday Y800to eatisuist 4:30pm Rev 8/16/2017 ��iIII crry OF PALO ALTO UTILITIES Inspired by a brighter tomorrow. Uluio, Service Address 9ZS) t?V?, cP 3 API tete/ Un i vet's r j� {je f% a Ake All addresses on the property being demolished need to be listed. A separate Demo application is requited for each address. DEMO Utilities Disconnection Prior To Building Demolition/Remodeling ❑ Single Family Dwelling 0 Multi Family Dwelling XConumercial Building Applicant Name Cifititl244 OD, t �"t 41lt44 Phone 4,37,_ »/' _30r J Owner Name Billing Address Email Address 1 P'- tae— Pa Jo- ix f ,,,„ phone t� a ...g/ �'• d ► 8q)c 2ott° Presto A- I*, CA- q %f'3 oZ- ejiz.-C 4 'jam [ 6t'1l a i• Ca-( Services Requested for Removal (Check all applicable boxes) 'Remove Electric Meter # L'Remove Gas Meter # 0 Remove Water Meter # ve Electric Service Line Remove Gas Service Line Utilities will be disconnected and/or removed within 1 and 10 working days after receipt of a completed application. Exact times and/or dates cannot be scheduled. i If ' u . es ar to be reinstalled, a connection fee will be charged per current utility rate schedule. Signature (Appli General Information Will there be multiple or new address(s) when construction is complete? Will you need temporary power during construction? Have you applied for a building permit? Will the foundation be removed? Date No No No No What is the purposed property use after demolition? (Example: single family home, restaurant) City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 850 329 -21St Fax 850.817-3142 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 4:30 pm Email: Web: MITAmdtaitsdaggileaudtokaaftwiam Rev 8/16/2017 CITY OFLITIES PALO ALTO UTI inspired by a brighter tomorrow. DEMO DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Street # Street Name (JN` EAS t'T`( kW. PAO MO, a1/4" Palo Alto Municipal code 16.04,060 section 105.1.3 provides no work or demolition shall begin upon any portion of such a unit until each and every portion has been vacated by all tenants lawfully in possession thereof. 1 ) tZ4)04 L)A hereby declare that I am the owner. or owner's agent. of the premises located at the servic address listed above. I also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise. Consists of t number of buildings 1 wilt not use not use any demolition permit issued to aid in securing vacation of said premise - I certify under penalty or perjury that the foregoing is true and correct. 5[1247/ 1 t /15itO0/15i fla, .— Print Name (osb- !IL? -3os-f Phone Number / Date City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave.. Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 Fax. 650-321.2786 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 5:00 pm Email: UtilitiesCurtiomerSeryicelacityofaaloaRa,orp Web: ► ttu:/lWnw.eyvolbalaalto ornldeobsAndetatlat ass Rev 12/2/2016 DEMO •%t//e .;; CiTY OF PALO ALTO UTILITIES Utilities Disconnection Prior inspired by a brighter tomorrow. To Building Demolition/Remodeling viirlriverseri Ave.; Rae M % Service Address ¥.7°C) g7.gj Sr; J tetri U, i vers i j+� A 'e Pnt, /44-0 All addresses on the property being demolished need to be listed. A separate Demo application is required for each address. 0 Single Family Dwelling 0 Multi Family Dwelling XConunercial Building Applicant Name Ct 1 t CM ODA f ti atta �EC '" J Phone Owner Name 0C-- Pt) kr LP Phone y-34rI r -8I s'-3o,rJ Billing Address 1 a, aQX 7.0' GAO /4. 1--b, C.06.- gig 02. - Email Address t�l zate-ki cop �Ct7 ot� lmezi L CFI. f Services Requested for Removal (Check all applicable boxes) 'Remove Electric Meter # eRemove Gas Meter # 0 Remove Water Meter # ff:Remove Electric Service Line 0 Remove Gas Service Line Utilities will be disconnected and/or removed within 1 and 10 working days after receipt of a completed application. Exact times and/or dates cannot be scheduled. If utilitl re t t reinstalled, a connection fee will be charged per current utility rate schedule. Signature (Applicant) neral Information Will there be multiple or new address(s) when construction is complete? Will you need temporary power during construction? Have you applied for a building permit? Will the foundation be removed? Date 18 No No No No What is the purposed property use after demolition? (Example: single family home, restaurant) City of Palo Alto Udlities, Customer Service Center 250 Hampton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 fax. 650417-3142 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 4:30 pm Ematl:UtiNesPustomerServicefelcitvofnaloalto.ona Web: htlpJ/www.c itvofoa ipalto.000ldenrsiutUdefavlt.asn Rev 8/16/2017 \1l f/i CITY OFLITIPALO ALTO) `e UTI ES Inspired by a brighter tomorrow. DEMO DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Street :iita Street Name Ni ets 1 rj fVLG { PAt Ate''0, C- ' Palo Alto Municipal code 16.04,060 section 10513 provides no work or demolition shall begin upon anv portion of such a unit until each and every portion has been vacated by all tenants law-fulh- in possession thereof. 1 ) GJh ? hereby declare that 1 am the owner, or owner's agent, of the premises located at the servic address listed above. I also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise Consists of 1 number of buildings I will not use not use anv demolition permit issued to aid in securing vacation of said premise. I certify under penalty or perjury that the foregoing is true and correct. 5l124/Le-VI Ma 0' Print Name J 6b- �'I �P -3arf Phone Numbcr Signature 7i/ Dote City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor. Palo Alto. CA 94301 Tel. 650 329-2161 Fax. 650-321-2786 Hours Mon -- Thur 7:30 am to 5:30 pm Friday 8:00 to 5:00 pm Email: titilitiesCustqmerServicetilicitvotualoalto.org Web: htta:/Iw4m.oitvofaaloalic,orst/deateh ttldera sa Rev 12/2/2016 1° UTILITIES Inspired by a brighter tomorrow DEMO DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolidon/Remodeiing Street # Street Name ( t ✓E .s I � Atvg , Ptio A-c.yro, i Palo Alto Municipal code 16.04.060 section 105.1.3 upon any portion of such a unit until each and every provides no work or demolition shall begin lawfully in portion has been vacated by all tenants ' possession thereof. 1 g)14,124 4)0 hereby declare that 1 am the owner, or owner's premises located at the servie address listed above. I also declare the building located ate service address listed above, for which a demolition permit is the occupied or presently being used for residential purposes. reqnested, is not currently Said Premise Consists of r number of buildings T will not use not use any demolition permit issued to aid in securing vacation of said premise. I certify under penalty or perjury that the foregoing is true and correct. 5l1 GU04j, /1a V — Print Name J Signature �v1'15- ! -3c�- Phone Number -7/9(//e City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 050 329-2161 Fax. 650.321-27b6 Hours Mon — Thur 7:30 am to 5:30 pm Friday 800 to 5:00 pm t:malr: Ott Web: Rev 12/2/2016 1 TODD ROTHBARD #67351 2 100 ATTORNEY Saratoga Avenue #200 Santa Clara, California 95051 3 Tel.: (408) 244-4200 4 Attorney for the Plaintiff 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA, STATE OF CALIFORNIA KIPLING POST, LP, Plaintiff, Vs. DESIGN WITHIN REACH, INC., DOES I through V, inclusive, Defendants. No. 18CV329356 STIPULATION AND ORDER IT /S HEREBY STIPULATED AND AGREED, by and between plaintiff KIPLING POST LP and defendant DESIGN WITHIN REACH, Inc. that: 1. Defendant and all occupants will vacate the premises located at 447 University Avenue, Palo Alto, Santa Clara County, California 94301 on or before July 15, 2018 (hereinafter "the vacate date"). Notwithstanding that the vacate date falls on a Sunday, there shall be no extension of this limit to the following working day. Defendant shall turn in all keys to said premises to plaintiff or plaintiff's agent at such time as it leaves, and shall leave said premises in broom clean and 24 undamaged condition, ordinary wear and tear excepted, and shall 25 comply in all respects with any requirements set forth in the 26 lease. respecting the manner in which possession of the premises Toddxoturd 27 m uw � . swaxo 0.28 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Todd Rothburd 27 AWm sy atLsw 100 Seipp Avows 28 &MOODits asra.Celitaiii is to be restored to plaintiff. Defendant shall remove all items of personal property from said premises at such time as it leaves; any items of personal property remaining behind after the vacate date may be disposed of by plaintiff without liability and without need for resort to the procedures set forth in Civil Code sections 1993, et. seq. 2. Defendant shall pay to plaintiff, on or before June 15, 2018, the sum of $63,875.52. This sum is comprised of holdover rent from June 1 through July 15 ($59,445.72), reimbursement for plaintiff's attorney's fees ($3,500.00), reimbursement for plaintiff's Court filing fee ($435.00), reimbursement for defendant's Court filing fee ($435,00) and reimbursement of ex parte fee ($60.00) . 3. If defendant pays and leaves as set forth above, upon the completion of performance by defendant and upon written demand to plaintiff's attorney by defendant or its attorney, plaintiff shall file a dismissal of this action, with prejudice, with no further award of fees or costs in favor of either party. 4. If defendant fails to pay or leave as set forth above, ,or if any check given by defendant in payment of all or any part of any amount due as set forth above is returned unpaid by the bank upon which drawn, in any such event plaintiff shall be entitled to immediate judgment for the full relief set forth in the complaint, including restitution of possession of the premises, unlawful detainer damages, attorney's fees, and costs, less applicable credit(s) for any payments) made by defendant prior to the date upon which such payment is obtained. Plaintiff may obtain said judgment by ex parte application to 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19! 20 21 22 23 24 25 26 ToddRothbad 27 Mosey at Law '°° 28 an Clam Caul& 9$(61 the Court, coupled with a declaration under penalty of perjury setting forth the facto constituting defendant's failure to perform in accordance with the foregoing requirements.. Before seeking to obtain said judgment, plaintiff's attorney shall give notice by telephone and email to defendant's attorney (Ms. Jill Rowe, Cooper, White & Cooper; tel.: 415-765-6239; email: jroweecwclaw.com) of plaintiff's intention to so proceed. If defendant fails to perform in accordance with the foregoing requirements, defendant waives any right it might otherwise have to contest, appeal, or seek to set aside said judgment, waives any right it might otherwise have to seek any form of stay of execution, either pursuant to Code of Civil Procedure sections 918, 1176, or otherwise, waives any right it might otherwise have to seek any form of relief from forfeiture, either pursuant to Civil Code section 3275, Code of Civil Procedure sections 1174, 1179, or otherwise, and waives any right it might otherwise have to seek any form of relief from default, either pursuant to code of Civil Procedure sections 473, 473.5, or otherwise. 5. Time is of the essence with respect to the provisions of this STIPULATION. This provision shall be interpreted in its strictest sense, with any failure to perform any requirement set forth herein on or before the date upon which performance is due, even if performance is late by only a single day, y, resulting in the relief upon default set forth above without regard to the relative hardship to the parties. 6. Other than with respect to a violation of the foregoing requirements, both parties waive any and all claims, of any 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ' bdd xothb. d 27 Ananey M Law 'COS * 28 Clan. CaTikeniaNOSI nature whatsoever, which each might have against the other, or against any principals, agents, shareholders, partners, managers, members, employees, affiliates, or assigns of the other. The parties understand that California Civil Code section 1542 provides: "A general release does not extend to the claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor." Notwithstanding this language, the parties sp ecifically pacifically waive its protection. The parties understand that they may have sustained serious damage or consequential injuries which have not manifested themselves and/or which are presently unknown, but nonetheless deliberately intend to and do hereby release these possible future claims. 7. Each of the terms and conditions set forth above is a material part of the consideration for the execution of this STIPULATION. Strict performance of each and every term and condition set forth above is required. The failure to perform in strict compliance with each and every condition set forth above shall be deemed a material breach of this STIPULATION entitling plaintiff to the relief upon default set forth above. 8. This STIPULATION sets forth the entire agreement between the parties with respect to the matters addressed herein. it shall not be altered nor modified unless such alteration or modification is in writing and signed by all signatories hereto. 9. A fax or email copy of this STIPULATION, bearing the faxed or emailed signatures of all signatories hereto, may be 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 28 24 25 26 roaditabbant 27 iwM C fap7�Q used for all purposes in lieu of an original. This STIPULATION may be executed in counterparts, with the sum of the counterparts, whether executed by fax, email, or otherwise, being the equivalent in legal contemplation of one fully executed original. DATED: DATED: DATED: DATED: Plaintiff Attorney for Plaintiff Defendant . COOPER, WHITE & COOPER Attorneys for Defendant lG�GL I L j ixthrtte RDBRf3kvLjCf �cam_ The Court having read maid reviewed the foregoing STIPULATION of the parties, and good cause appearing therefor, IT IS SO ORDERED. DATED: %JUN 13 2018 5 i 11'0E4 f.Qr all purposes- in lieu -of an original. This STIPOLATxoN 2 may exec tec in counterparts, with the sum af. the 4 counterparts, whether -exegu :ed by fav, email., or atherWise, 4. being- the equivalent. in legal :contemplation of one fully exequte4 .orisint .. 6 7 9 DATED: 1011 .b b. t.4 � P.4 TBDs 7144/1. g z v 1 e 16 18 17 000 18 20 'Thy dnurt 'having. read. and previewed the- foregoing. 22 $TIPUI;ieY roN t'4e, parties;: aridgO94 cause appearing. therefor, 28 XrIsSO4ri -. 4 .20 DAT$D - taa a "40; twy;±:.panr.eansl r " fir., Plaintiff 4115D11 RDTREIAttn Attosay` gor ,Pl,aintift =now ITRIN •i ► ; `. tqC. 1:41AP4allt LCMithe. i -en), Cry fripiem.i) as -A RWA 00414.4, •rynJ.4L, 00 Attorneys for- befendint: wk 11 Ko Architects, Inc. September 1, 2017 Mrs. Elizabeth Wong ' • Kipling Post LP, Successors and Assigns RE: 425-429 University Mixed Use Project in Palo Alto Dear Elizabeth, Thank you very much for considering us to provide architectural services for construction documents of a mixed use project located at 425-429 University Avenue in Palo Alto, California. Please find the enclosed service proposal for your review and approval. We will proceed with the design services upon receiving yow signature on our agreement We are looking forward to working with you on this exciting project Please contact us if you have any questions. Sincerely, Peter Ko, AIA, LEED AP Principal Ko Architects, Inc. 4100 Nigh $b.ot, Suke Om Pea Mo. CA 94301 Tot 8601969-1608 Emit aesigekoa,ph coma 1 Litt NC{ uu AON 1101 100 'en v tut UL Aine us AWL tu► U1 eta 'fl'ti wok not lei von sess 'moan tin tot Moves Ma *et d tttL Vet I PA tioi let *MN ut iUYt 12t Dint fro J o woo 4.00.04 ,00 wevi •es - stlisimesti anfume *Ion :aime d ammo 10AeNId*p ew Att:tisvi X411MB Pleanawd:t Nevi mom ilwod :t Mslil mold Q3ateidwoorg Mfiyl amid aangdwors:►M AL liNitraNSIMMORMIIIMPS VIA 'tL 3 *IO 'ClAtdamson* LON. tau wawa D uman us/.►ouprM1YN0011N1!ifrv1 •tYO17VL1NO0 MMVNOILV,100iNtOTNON pOM t AMU .11MOi drllLWOW MIMSx)Itvl *maw N am • Ware= sou antamo vein 111NV1V*OOmoat/m ap -RW3QONolione mpeo Tur d 11140111013)010111310 -.11011d0180610 WOO 3 )111W. .flidill yaiyi1HY .0 '1.-1 arbas taONOM30:$ M1Yl ubewrinemyawloam-. arsoc omkmeinma 3MW1MYi, 414 241 V O :A@ CERW Nd e neis.v a 8'd1 pod * ado} :wa n* no LML'W f w4 wNdi=3Lve 810Z-LLQZ :31f105H3$ MOId J.N3$30VNYN 133f'OZid C2Ei Contract for CALGreen Tier 2 and CALGreen Consulting Services This Agreement is made on April 26, 2818 by and between Elizabeth Wong the ("Client") and Kate Latham ("Consultant'), for the property at 42911niversity Avenue, Palo: Alto, CA 94301, which is under the building jurisdiction of City of Palo Alto ("CPA"), with m ace to the following: L Prat jest Set; Client's intention is to have a CALGreen Tier 2 c atification fora three -unit, 8,100 fl , new construction residential pmj ct as required by the 2015 CPA Green Building Ordinance effective June 22, 2015. 2. Scope of CAtsLGre en Tier 2 Consulting Services: Consultant agrees to provide the following consulting services required to obtain a CALGeen Tier 2 certification: • Work arith Client's project team.to develop a cost effective CALGreen Tier 2 checklist that meets the requirements of the Ordinancefor the specific buildingproject noted above and the Client's needs. • Review Client's plans prior to submission for a building permit and suggest CALGreen Tier 2 notes for architectural plans. • Review Title 24 Q24) CF-IR for submission with GB -1 Application if necessary. • Assist with preparing the Client's CALGreen Tier 2 checklist sheet for submittal for building permit and provide preparation assistance and signatures. • Prepare and provide detailed CALGreen Tier 2 checklist requirements for project specific CALGreen Tier 2 measures and conduct preoonstruction meeting with contractor and Client. • Coosrdgnate and lead the three mandatory inspections required by the City of Palo Alto (CPA), which include CPA Green Building Inspector. • Prepare and provide detailed list of requirements for project specific CALGreen Tier 2 measures for precorwtruction meeting. • Provides timely CALGreen Tier 2 rater documentation and signatures for all the steps required in the Green Building Centifieation Summary on CPA submittal sheet GB -1 CALGreen Tier 2. • Conduct site field inspections as pan of basic CALGreen Ter 2 certification fee including pre -construction meeting with oortsratitor. • Conduct required CALGreen Tier 2 inspections in a timely manner. • Assess;whether each CALGreen Tier 2 measure applied for meets the detailed CPA requirements based on the CALGreen Tier 2 Manual and if not, provide suggestions of what CALGreen Tier 2 measures could be chosen by Client to meet the CALGreen Tier 2 requirements. • If neceSssry, arrange for HERS inspections as required by the 124 report. • Prepare comprehensive project dOotmsentation for each CALGreen Tier 2 measure certified with assistance from Client's project team for review by CPA. The role of the CALGreen Rater is primarily as a verifier. It is the responsibility of the Client and their contractor to provide written documentation of compliance with checklist requirements in the tom of invoices, product labels and specifications, dump tags, etc. unless they can be confirmed onsite by the Rater through inspections and photos. • Prepare and submit final project certified CALGreen Tier 2 checklist and all documentation to CPA for review demonstrating that project has met the minimum CPA green building ordinance. • Maintain project documentation for 5 years in anticipation of CALGreen Tier 2 CPA project audit. 3. Fee for CALGreen Tier 2 Consulting Services: The basic CALGreen Tier 2 certification fee will be $3,200.00 for Client's project as defined above and that meets the CALGreen Tier 2 certification requirements in effect at the time of this agreement 4. Payment Schedule: Client is to pay Consultant on the following schedule: • $960.80 (30%) upon accquance of this proposal • $1,600.00 (50%) at time of rough inspection with City Inspector • 5640.00 (20%) due before final Cal Green building inspection Clint: Elizabeth Wong Consultant: Kate Lathan) 429 University Avenue, Palo Alto hatea®iathamhomerath eom 1650-450.1827 Signature: Date: Peiltilt-14/4wy.4.1).14.4.0, Date: 4/26/22018 If proposal is acceptable, checks may be made to `Latham Home Rating' and sent to: Kate Latham at 763 N. Rengstorff Ave. #22, Mountain View, CA 94043 KASSOUNI LAW Via E -Mail and U.S. Mail October 31, 2018 Molly Stump Office of the City Attorney City of Palo Alto 250 Hamilton Ave. Palo Alto, CA 94301 Re: 429 University Ave., 14PLN-00222 Dear Ms. Stump: This firm represents Kipling Post, LP, the owner of 429 University Avenue. As you know, Elizabeth Wong, on behalf of Kipling Post, has spent the last 18 months seeking ARB approval for three minor aspects of the design of the above -referenced project, which was approved by the City Council in February of 2017. Recently, after the third ARB hearing, Jonathan Lait issued a Notice of Proposed Decision stating that the Planning Director (Acting) approved two of the three minor aspects of the design, but denied the third (building materials, colors, and craftsmanship -related details). (EX. A). The denial contradicts the Planning Department's recommendation to ARB of approval of all three aspects of the design. I will be addressing the denial in more detail in a forthcoming letter, which will support Kipling Post's appeal. The purpose of this letter is to address the issue of Palo Alto Code section 18.77.090, which sets forth a one year "expiration" of approvals. Last year Kipling Post sought and obtained a one year extension, up to and including February 6, 2019. Several days ago, in an abundance of caution, Ms. Wong requested of Jodie Gerhardt a second extension to February 6, 2020. As you will see in the attached e-mail (Ex. B), Ms. Gerhardt responded that she "will need to speak with our attorneys to better understand if a second extension is allowed." I wish to state in the strongest terms that the City has absolutely no discretion shut down this project based upon section 18.77.090, nor is Kipling Post required to obtain such an extension in the first instance. I am aware that Michael Harbour has long opposed this project, and has been in close contact with key members of the Planning Department on this very issue. For the following reasons, it is hoped that as City Attorney you will proactively discourage staff from being led down the wrong path on this issue. First, section 18.077.090 provides in part that the expiration date is only triggered if "the proposed use of the site or the construction of buildings has not commenced." Yet the history of the activity of Kipling Post unequivocally establishes commencement of proposed use as well as commencement of the construction of buildings. Examples include the following, all of which are set forth in more detail in Ex. C: 621 CAPITOL MALL, SUITE 2025 SACRAMENTO, CALIFORNIA 95814 TELEPHONE 916.930.0030 FACSIMILE 916.930.0033 Molly Stump Office of the City Attorney October 31, 2018 Page 2 of 4 • Retention of the Ko Architects firm to provide three separate sets of drawings to address three separate ARB hearings at great expense; • Completion of the removal of street trees pursuant to validly issued permits; • Payment of fees for new water service connections, fire service capacity, and water meters; • Removal of hazardous materials; • Archaeological services; • Disconnection of utilities to the site; • Eviction of tenants; • Preparation of construction documents; • CALGreen compliance; • Building permit fees ($186,871.77); • Issuance of Encroachment Permit for installation of ground level monitoring piezometer; • Hundreds of hours of work and hundreds of thousands of dollars in expenses in obtaining building permit approval status from multiple departments, as set forth in Ex. D; and • Three ARB hearings. These and other activities and substantial expenses more than establish the good faith intent of Kipling Post to proceed with all approvals necessary for issuance of the building permit. As such, Kipling Post has a right to continue with the process without the threat of application of section 18.077.090. It is settled authority in California that the purpose of statutes or ordinances providing for automatic expiration or revocation of land use approvals if a use has not yet been established is to prevent the reservation of land for future purposes when the permittee has no good faith intent to commence upon the proposed use. Molly Stump Office of the City Attorney October 31, 2018 Page 3 of 4 This conclusion is supported by the seminal First District Court of Appeal case on the subject, Community Development Com. v. City of Fort Bragg (1988) 204 Cal. App. 3d 1124, 1129. In this case, the trial court arbitrarily refused to consider factors other than completion of construction in determining whether there had been a good -faith effort to commence construction. In that case, the Community Development Commission of Mendocino County (CDC) obtained a use permit on April 26, 1983 for the construction of affordable housing. The Fort Bragg Municipal Code at the time contained a section providing for the expiration of conditional use permits in one year of the date of issuance unless substantial evidence of use was in progress. (Id. at p. 1126.) The trial court concluded that the use permit had expired on April 26, 1984 because no substantial work had been done on the property. (Id.. at p. 1128.) The trial court further concluded that residential use had not commenced on the property, and on -site construction expenses had not been incurred. The trial court stated that the "only activities undertaken by CDC with respect to this site related to steps preparatory to its application for a building permit." (Id.) On appeal, the CDC argued that the trial court erroneously construed the Municipal code section as intending "to cause the automatic expiration of use permits where the permittee has neither actually used the land for the purpose stated in the permit nor substantially begun construction work necessary for the use." (Community Development, supra, 204 Ca1.App.3d at p. 1129.) The CDC further contended on appeal that the trial court incorrectly found that the CDC's failure to actually construct buildings constituted a lack of substantial evidence of the use in progress. (Ibid.) The Court of Appeal agreed with the CDC and reversed the trial court's judgment and finding that the use permit had expired: The record in this case clearly demonstrates CDC was proceeding with a good faith intent to commence upon the proposed use. It is undisputed that CDC pursued and obtained a funding commitment from HUD; that it purchased the Sanderson property at a cost of $95,000; hired architects and engineers for the performance of preconstruction work at a cost of $85,000; had soil borings performed; arranged for the removal of two small structures; and submitted plans to Fort Bragg's building inspection for "plan check review." The trial court's determination that substantial evidence of use was not shown because of the absence of actual on -site construction bears no definitive relationship to the purpose of the Fort Bragg ordinance. In a complex, government - financed development, a good faith intent to proceed may be established in several ways, exclusive of actual on -site construction .... it was unreasonable for the trial court to apply a standard concerned with the extent of construction alone. (Community Development, supra, 204 Ca1.App.3d at pp. 1130-1131, emphases added.) Molly Stump Office of the City Attorney October 31, 2018 Page 4 of 4 It would be gross abuse of process for the City to apply section 18.077.090 to shut down this project, and any such attempt will be opposed in Court in an action for writ relief and damages under the Fifth Amendment and under 42 U.S.C. 1983. We anticipate that the City will promptly acknowledge and confirm that Kipling Post has already commenced proposed use of the site consistent with the foregoing Court of Appeal authority and the documentation included in this correspondence. Thank you for your prompt attention. Sincerely, othy V. Kassouni cc: Ed Shikada [via e-mail Ed.Shikada@cityofpaloalto.org] Jonathan Lait [via e-mail Jonathan.Lait@cityofpaloalto.org] George Hoyt [via e-mail George.Hoyt@cityofpaloalto.org] Brad Eggleston [via e-mail Brad.Eggleston@cityofpaloalto.org] Rosemary Morse [via e-mail Rosemary.Morse@cityofpaloalto.org] Exhibits A -D Ex. A C13` .7.= PALO ALTO NOTICE OF PROPOSED DIRECTOR'S DECISION Dear property owner or resident, This is to notify you that the City has made a decision on a proposed project within 600 feet.of your property. The project proposed for 429 UNIVERSITY AV was given a partial approval and partial denial by the City's Director of Planning and Community Environment. 4 ADDRESS: 429 UNIVERSITY AV FILE NUMBER: 18PLN-00240 PROJECT DECISION: Approving in -part and denying in -part: Approved with respect to the decorative wall treatment for the project's west elevation and landscape details; it is denied with respect to exterior building materials, colors, and craftsmanship -related details. Denial in part is consistent with comments and concerns expressed by Architectural Review Board Members at its August 16, September 20, and October 4, 2018 Meetings regarding the exterior detailing and craftsmanship of the project. It also follows Kipling Post LP' refusa on October 15, 2018, of suggestion to incorporate detailing into the design in an effort to secure a complete project approval. The plans may have changed since the initial plan submittal. More information about the project and the City's decision letter may be viewed online at: https://www. cityofpaloalto.org/gov/depts/oln/current/proi ects/default. asp In accordance with the provision of PANIC Chapter 18.77.070 (d), any person may file an appeal of the proposed decision. The director's decision shall become final 14 calendar days after the postmarked date that this notice is mailed or published, whichever is later, unless a formal written appeal and applicable fees are submitted to the Planning Department. Should you have any questions regarding the Director's decision, please do not hesitate.to contact the Project Planner. NAME: ADAM PETERSEN PHONE: 408 340-5642 EMAIL: apetersen@m-group.us v20180826 Ex. B From: Gerhardt, Jodie <Jodie.Gerhardt@cityofpaloalto.orq> Date: Fri, Oct 26, 2018 at 4:48 PM Subject: RE: Request for Permit Time Extension To: Elizabeth Wong <elizabethwona2009@gmail.com>, Lait, Jonathan <Jonathan. Lait@cityofpaloalto.orq> Cc: Hoyt, George <George.Hoyt@citvofpaloalto.org>, Peter Ko <design©koarch.com>, Laura Roberts <laura@koarch.com>, Andrew Wong <a.jaime.wong@gmail.com>, Jaime Wong <jandewonq@gmail.com> Elizabeth, The City has already issued one extension for this project (see attached) which is allowed by the Zoning Code. I will need to speak with our attorneys to better understand if a second extension is allowed. Sincerely, Jodie Gerhardt, AICP I Manager of Current Planning 1 P&CE Department 250 Hamilton Avenue I Palo Alto, CA 94301 T: 650.329.2575 I E: Iodie.gerhardt@citvofpaloalto.org From: Elizabeth Wong[mailto:elizabethwong2009Cahgmail.coml Sent: Friday, October 26, 2018 10:15 AM To: Gerhardt, Jodie; Lait, Jonathan Cc: Hoyt, George; Peter Ko; Laura Roberts; Andrew Wong; Jaime Wong Subject: Re: Request for Permit Time Extension Jodie, Jonathan, Please email me form and instructions for extending the Building Permit deadline. Thank you. Elizabeth Wong 1 On Fri, Oct 26, 2018 at 9:07 AM Spotwood, Alicia <Alicia.Spotwood@cityofpaloalto.org> wrote: Elizabeth, Please discuss with Jodie, 1 don't have a form for you. Thanks, Jodie Original Message From: Elizabeth Wong [mailto:elizahethwong2009 a;gmail.comj Sent: Friday, October 26, 2018 9:06 AM To: Spotwood, Alicia Cc: Hoyt, George; design.i oarch.com; (aura cc koarch.com; Andrew Wong; jandewong n,gmail.com Subject: Request for Permit Time Extension Hi Alicia I don't have the permit yet so it is not in George Hoyt 's perview It is in Planning 's perview. Could you email me the forms for the time extension? Thanks Elizabeth Sent from my iPhone Ex. C EXAMPLES OF COMMENCEMENT OF PROPOSED USE OF SITE 425-429-435-441-447 UNIVERSITY AVENUE, PALO ALTO DATE DESCRIPTION EXHIBITS 6/7/2018 Completed Removal of Street Trees Tree Removal Permit and Fees Paid 3/2/2018 Building Permit Fees Submitted Construction Plans for Building Permit; Amount Paid $186,871.77 5/7/2018 Paid fees for new water service connection, fire service capacity, and water meter Receipts from City of Palo Alto Utilities Department 8/27/2018 Removal of Hazardous Materials Completion Notice from JWH Asbestos Removal Services 8/29/2018 Archaeological Services as required in Conditions of Approval Executed Contract with Holman & Associates 10/30/2018 Move Sewer Line in Lane 30 Contract with Able Septic Tank Service 7/25/2018 Disconnection of Utilities to Site Termination of Service and Declaration Concerning Tenancy 6/13/2018 Eviction of Tenants Court Stipulation and Order for removal of the last tenant by July 15, 2018 9/1/2017 Preparation of Construction Documents Contract acknowledgement letter and Timeline from Ko Architects 5/7/2018 CALGreen Compliance Contract for Cal Green Tier 2 and Cal Green Consulting Services 9/5/2018 Installation of Piezometer and Ground Water Level Monitoring Enncroachment Permit and Temporary Lease by Exploration Geoservices Inc. 0) days afterwctP ° remove said e� ahtitent 3 t° remove such any anon , �� °B from the rii'0• g et or a a7 inearo enta construct od, and thin/melt/lease 2 restored, by tie City, and the co thereof madwithin a We.Lime °$Edd, lie saute ma°ay be - Fenn/nee ec: pe shall easement Palo Alto v the City, Code. upon/against Perminee/ sions ilia exam or failure reamed, and the .oreasetr2 ��ne°° � OO�d�lion oFth isyu ° Punt to the Pro��stons o Sec I3.12 ai tbi: �any nature w�e°t' drat utde�� �dholds�Penmtt/lease, agrees to maintain • onctna issuance -of •. hatsaerrcr caused m whole in }i runless the City ofPalo Alto, its o C evidence of iiab' Q, conditions authorized or Q P by reason or in genes, and a Toro life of ' manner connected -with , Io ees from liability Per conditions shall be permitted ft. by this perimit/iease. The Pcrmittee agrees and un $- operations, esstr or prop me-nons1.1 for ob ends that3this permit tests no estate. 1�Po d use: Notwitlu: and all permits which b re urdred flueabo noticingcontatnedl msh bi ay te Cittyt oisstiea yp'stmitsor over the Petntittce hereby , gild agrees theta]] t "• easel sib' approvals evel DURATION: Temporary JAL_ Days) ._indefinite ESTIMATED START DATE: Fee Paid Parking TOTAL Date Paid: INS CERT it: I- fEI N f OOo REVIEWED AND RECOMMENDED ED FOR APPROVAL BY: Transportation Bldg Inspection Planning Real Estate Li�' WOW Power PF STAFF USE ONIF- FEES: 11 :. A,--31CQ I City of Palo Alto Public Works Engineering Phan :650529 215] FAX: d50/3,ig.2240 Inspection: 65(1!496-6929 PERMIT TYPE: DEVELOP MEN i SE V CE �I:NclzoA ��®� J,, Copy IMENT PERMIT (Ri o f Way or pnbiic utilitiea es — TEMPORARY LEASE easement encroachments) (El! on City -owned gcnPon,3') z PERMUTES nano � ADDRESS: Name: r LOCATION {!F CROAC)i 1ITlLEA,E: ill phone: y 1: bg7-? I°CROAC - NTF�T=IPi; . . Ressslen_ trsi ffi c Far+. - _ Standard: Architectural, structural, decks, (PUE) or City right of -way [ROVE ems_ in a Public, Utilities Easement - Aster or container (no insurance csrtiFicata is rewired). F- ence: Placement ofa fence in a PUS or ROW no ?Il11t idenSal f mmAr, { insulin/0e cecitioate is required) z — S�dzark Awnings, Toile orsidewatic closures, pedeshisn protectio• n structures, 0 structural or architectural features private eneroacllments in a PUE or ROW, Jesting striatum. other long term Short -Term: Sidowalk/siteeVaI1 encroachments, $ more than 5 days_ �' ' hdays lane ar sidewalk closures, � of materials, lasting 3 days or less. I Day: Sidewalk ar lane closure lases 1 day or less. _Minor: Places spaceent er within dovt tov�n.distticts (additional paw apace �if applicable), and fee for Pursuant to the restauranttables & chairs on sidewalk., P Provisions of Sec 12.12 s of the Pala Alto Municipal Code, hereby requestedeatron wad indmaintain an encroachment, or to use C� _-o dsi ro e , at the above JO IIner dese ibed blow: rt3 olvned prop, N.TUR.E OF •ENCROAC�N}•' OR USE: ed:cox C- REASON FOR` Ei CROACA'IENT,LEASE: 04!ef'D sJ r - f _ r A COn "te i17a!3 en Penninee ; hall, atPernritte.e e - within thirty require for construction. ae . ur a alI of td . , tndr oas ,je°t to all conditions set forth h interest of a �� , , pravistans strap be bin � and the atmc n' res ase shall t:. dmgottPerrstinee, coot SpecialProYisionsand andconcessor, PPmta or a co -owners, he' � ¢ty& seers ca ro 1• tee AUG 17 2018 ENCROACHMENT PERMIT -8s TEMPORARY LEASE Cr) a »' For ins .,, Phan work on the erect - 1. by the mica start dal as m�/ t describe ti`nn c�oees of cor ncL within Po ate APPR O p BY lie Works Inspector C (650) 496-5929 -Provide ~� minimum one working dayridvautm notice. issuance ate anPWCIlaNG,pRMSelixnachreentencpachm=ntFefiut FonT.t'ac Aa appticabte Rev iomalto APPROVED CITY Of PALO ALTO Tree Site No. R2 RI R1 URBAN FORESTAY SECTION TREE PERMIT Fop RE�aTGU 7-, c��,.k1 P TRE- PUBLIC WORKS try �F PALO ALTO Public Services Division - Urban Forestr9CSec&on pwps@cityofpaloaltoorg PROJECT ADDRESS: 429 University APPLICANT INFORMATION Nam Ko Architects. Inc. Address: • • • s - 18000-00:536 so Phone: (650) 853-1908 E-ripil. dcsitm@koarch.com SCOPE OF WORK Description Cell: Fax Remove street tree inventoried at 447 University, site R2 Species Value Size Carob $1750 itsmoyestreot treeJnYeats»d 8t 447 University, site R1 Carob Plant 4 sew Otect trl es__Lcaortilig. Gingko to building permit sheet Ll $1750 35 40 Application Date: Start Date: 6/11(g Completion Date: REQUIRED AITACHMENTS t Site Plan 2. Other: PERMIT CONDITIONS 1. The permitted work shall conform to City of Palo Alto standard specifications and the Tree Technical Manual including those checked above. See attached specifications 2. Permit shall be available on site during work. 3. Perr hues removing trees and stumps, and/or planting new trees shall use PW Detail #604. 4. PPanwtteeisresponsible to notify Underground Service Alert (USA) prior to stump ►ernowi and replacement tree 5. All work shall be completed by a licensed tree service or landscaping,contrachor. a 6. New tree shall be Inspected by urban forestry inspector prior to antaltation (650.4$6.5953) 7. When required, Irrigation bubbler heads shall be suppled to each new tree per PW Detail #513. 8. Applications that Include pruning or removal of regulated trees must attach a report from a certified arboreal 9. In consideration of the granbng of this omit. for priming an International Society of Arboriculture Certified Arborist must be en site. All work shall be done in accordance with: • Palo Alto Municipal Code Title a Trees and Vegetation • Tree Technical Manual. PAMC. 8.10.130 • American National Standards Institute (ANSI) Standards for Tree Care Operations A300 & 2133 • ANSI Standard for Nursery Stock Z603 • Underground Service Alert (USA) notification requirements • Proof of insurance as specified by the City of Palo Alto • 10 Add{ t+onaIlCConditions: Of WOrk t be completed Dist From Left Prop. Line 58 100 TBD _reragitiangsffikgaggettian.conditions soli voluble. and ini ae specilledin the building Pew Permutes affirms that the facts stated herein are true and agrees that (s)he. his or her agents. employees, and contractors shall perform ell work described heroin in conformance with ordinances and standard specification of the City of Palo Alto. The parriittge agrees abide with the Permit Conditions outlined above and hold the City of Palo Alto. Its officers. officials. agents. to from ell costs and damages which might arise from the Pemiittee'k use or occupancy of public right -of- permit may be revokedevs at any time - f the above lilies. Pernik be 6 a (A) APPLI NATU j DATE PERMIT ISSUER x(1(16 DATE r .. •.n, r .encr.s.vwaa.w...v`wavneoc...t v... m o-r..uwr�... a c.• +sm:a,Hr xrM+...me�r_..vaei.+r.v �sw.sv assw.:aw.t.emea CITY OF PALO ALTO DEVELOPMENT CENTER 285 HAMILTON AVENUE PALO ALTO, CA 94301 (650) 329-2496 OWNER: KIPLING POST LP CONTRACTOR: PROPERTY ADDRESS: 429 UNIVERSITY AV RECEIPT NUMBER: 334699 RECEIPT DATE: 3/2/2018 9:53:31AM PERMIT NUMBER: 18000-00536 Print Date: 03/02/2018 Type: Project Sub -Type: Building Permit Category: Building Permit FEE DESCRIPTION ` SUBFUND-ACTIVITY Landscape Plan Check - Commercial & Multi -Family 65060001 1337 Buildine Plan Check Fee Utilities Plan Check Public Works Plan Check Fee Fire Plan Check - Commercial & Multi-Familv Zonine Plan Check Fee UNITS FEE AMOUNT 1 $1,973.00 65030001 1337 1 $66,627.98 65030001 1337 1 $118.00 65040001 1337 1 $39,088.12 65050001 1337 1 , $47,971.73 65020001 1323 1 $31,092.94 Amount Due: $186,871.77 Check Amount Paid: $186,87L77 Fees paid include a Technology Surcharge of 1.8% per transaction approved in FY 18 Municipal Fee Schedule Comment: t-I,ecl* r- i 041g 3�v1�8 20170818 �•♦ GRr OF PAla ALTO UTILITIES Billing Address: KIPLING POST LP P. O. Box 204 Palo Afto CA 94301 Service Address: 429 University Ave Palo Alto CA 94301 Item N . Sales Order/ /Ref. Service Order City of Palo Alto 250 Hamilton Ave. Palo Alto, California 94301 Invoice Number : 95019717 Invoice Date : 05/07/2018 Customer No : 20002551 CrV-gact Accius+t • 1An.^a9R1 CITY OF PALO ALTO UTILITIES DEPARTMENT W-G-WENGDIEERING BILLING AMOUNT GOOD FOR 90 DAYS DUE IN PULL PARTIAL ItINENT8 NOT ACC PI D 000010 000020 000030 70041155 40023443 70041155 40023443 70041155 40023443 Service Description NEW 6" WATER SERVICE CONNECTION 6" FIRE SERVICE CAPACITY FEES 5/8" WATER METER INSTL CHARGE Amount 8,137.00 22,530.00 698.00 Total Due $ 31.365.00 Remit Payment to: Nail: Revenue Collections -City of Palo Alto P.O. Box 10250 Palo Alto, CA 94303 In person: Revenue Collections, 250 BosiltonAme., lst Floor, Palo, Alto, CA 94301 For Billing Contact: email: kelly.haruta6cityofpaloalto.org phone: (650) 617-3106 This invoice amount is good until 90 days after the effective date of that next Council -approved rata increase. If you have not paid the amount due within that time, a new invoice will be prepared and mailed to you. The new invoice will be prepared using the sates in effect at the time of mailing. ity of itY of part° tevenue Collection Reference ."05 ber: 2016128002-68 DatelTime 08/2018 54:55 PM S 0 Pro -Forma Payment 2018128002-68-1 S 0 Pro -Forma Payment Contract Account:L 000010006981 Last Name First Name KIPLING POST Amount: Total: 1 ITEM TOTAL: TOTAL: Check 04672 Check Nbr: $31,365.00 Total Received`d:```` `` `` iI'U�I�����II�I� III'll�l�l'�I'III�I'�I� - 6 8 I�I�IIIE2 128002 CE 018 $31,365.00 $31,365,00 City of Palo Alto 250 Hamilton Ave. 9lo Alto, California 94301 Customer Copy $31,365.00 • $31,365.00 $31,365.00 Invoice Number : 95019717 Invoice Dote : 05/07/2018 Customer No : 20002551 Contra Peg-AND/4 • lnnan981 CITY OF PALO ALTO UTILITIES DEPARTMENT W -G -W ENGINEERING BILLING AMOUNT GOOD • FOR 90 DAYS DUE IN PULL PAAflALP.Ut1ENrSNOT ACCEPTED )tion SERVICE CONNECTION E CAPACITY FEES ER INSTL CHARGE Amount 8,137.00 22,530.00 698.00 Total Due $ 31.365.00 Remit Payment to: Mail: Revenue Collections -City of Palo Alto P.O. Box 10250 Palo Alto, CA 94303 In person: Revenue Collections, 250 Hamilton Ave., 1st Floor, Palo, Alto, CA 94301 For Billing Contact: email: kslly.haruta€cityofpaloalto.org phone: (650) 617-3106 This invoice amount is good until 90 days after the effective date of the next Council -approved rate increase. If you have not paid the amount due within that time, a new invoice will be prepared and mailed to you. The new invoice will be prepared using the rates in effect at the time of mailing. Psio Alto 250 Icon Ave. Palo Alto, California 94301 antocPAW WO UTILITIES, Billing Address: KIPLING POST LP P. O. Box 204 Palo Alto CA 94301 Service address: 429 University Ave Palo Alto CA 94301 Item No /Ref. Sales V eke Service Order Service beecription Invoice Number : 95019723 invoice Date : 0509/2018 Customer No : 20002551 Contract Account :10008981 96391 30 Amount 000010 70041278 40023479 NEW 8" WATER SERVICE CONNECTION 1.332.00 Total Due $ 1. bait Payment to: Mail: Revenue Collections -City of Palo Alto B.O. Hoe 10250 Palo Alto, CA 94303 Xis person: Revenue Collections, 280 Hamilton Ave., 1st floor, Palo, Alto, CA 94301 For Billing Contact: email: kelly.haruta$cityofpaloalto.org phone: (650) 617-3106 This invoice amount is good until 90 days after the effective date of the next Council -approved sate increase. Xf you have not paid the amount due within that time, a new invoice will be prepared and mailed to yea. The new invoice will be pampered using the rates in effect at the time of sailing. J . W. H . Asbestos REMOVAL SERVICES CSLB No, 777430 OSHA No. 270 COMPLETION NOTICE This is to certify that J.W.H. Asbestos Removal Services has completed the removal of the asbestos contracted per HMA Asbestos Survey #18.240 dated July 27, 2018 Removal and disposal of 1,600 sq ft of sheetrock/joint compound less than 1% non -friable asbestos from lower walls on sides and back wall and 2 upper walls in Unit#425. Removal and disposal of 120 sq. ft. VAT tile and mastic and tape on flue pipe in Unit#441. Removal and disposal of asbestos tape on plenum box in Unit#447. Removal and disposal of carpet, floor tile and mastic on wood, transite flue pipe and asbestos tape on metal pipe in Unit#450. at the following job location: 425,441,447 University Ave, Palo Alto, CA 94301 450 Kipling Street, Palo Alto, CA 94301 In accordance with J.W.H. Asbestos Removal Services proposal signed/dated August 6, 2018. This notice conforms to and is in strict compliance with all applicable standards and regulations. This provision of completion is our acknowledgment by authorized signature that all services that have been contracted for are completed as specified at the above referenced property location. il4 - W. Howell Date .H. Asbestos Removal Services August 27, 2018 710 E. McGlincy Lane #111, Campbell, CA 95008 Tel: 408.374-1123 Fax: 408-374-1091 tOLfl'OFASSOCIATES Auchaeologicat Consultants "SINCE THE BEGINNING" 3615 FOLSOM ST. SAN FRANCISCO, CALIFORNIA 94110 41S/SSQ 7286 Elizabeth Wong Steleco LLC POBox2014 Palo Alto, CA 94302 29 August 2018 re: Proposal/Authorization for Historical Resources/Archaeological Training, 425-429 University Avenue, Palo Alto Thank you for contacting us regarding an archaeological and historical resources Mitigation Measure requiring training for construction personnel for your Project at 425-429 University Avenue in Palo Alto. A redevelopment project proposed for the property will require excavations about 30 feet deep, which would adversely impact historical or archaeological resources, if any, therefore the City has required this training. The Scope of Services for this work will be to provide a training session "... regarding how to recognize cultural resources ... that could be encountered during construction activities" as per Mitigation Measure CUL- 1 (attached). Such a training session would typically take 45 minutes to one hour and would be conducted at the jobsite. Potential attendees would be determined by you and your construction contractor(s). Our fee for these services will be Not to Exceed $400 (plus mileage at 58.501mile), depending on which of our staff is used, and could be less if we can coordinate the training session with other work in the vicinity that same day. Any additional work or site visits would be charged at standard hourly rates of $100/hr for Senior Associate(s), $85/hr for Staff Archaeologist(s), or $80/hr for Archaeological Technician(s), plus a maximum daily mileage charge up to 100 miles. What we need from you: 1. Notice at least one week before the training, specifying time and place. 2. Authorization to Proceed. Please sign and return an original of this Proposal to serve as Authorization to Proceed and as agreement to pay Invoices within 30 days of receipt. A signed digital copy will suffice, or you may fax a signed copy to 415-282-6239, or send your standard contract/authorization with this Proposal as an exhibit. Please call Miley or email Holman.Assoc@comcastnet or me at 650-726-6269 or mrccrm@comcastnet if you have any questions. Cordially yours, Matthew R Clark, RPA Senior Associate E.Wone re 425 University Palo Alto Archaeological Training, 28 August 2018. page 2 of 2 Autl-E. I1 � Name Title Vv 8 br 44,ker.y0{- M'r Company/Agency stew& _, ?is/ Dated: Total Contract Price: NTE $458.50 Project: H&A 08-06/18 CULTURAL RESOURCES Mltlgellion Measure CU41: Prior to oommencement of sit e clearing and project grading, the project applicant shall retain a qualified prchaeologtst to train construction personnel regarding howto rec ognize cultural resources (such its structural features, unusual amounts of bone or shag, artifacts, human remains, or architectural remains) that could be encountered during construction activities. If ar8taota or unusual amounts of shell or bone or o8her it ems IndlostIve of burled araheeolog cal resarrces or human remains are encountered during earth disturbance associated with the proposed project, the on-ete contractor shag immediately notify the City of Palo Alto ({ and the Native American Heritage Commiselon as appropriate. AU soli -disturbing work shad be halted within 100 fact of the discovery unlit a qualified archaeologist, as defined by the California Envlrenmentat Quality Act (CEQA) Gusda�hee (14 CCR 1. s etseq .) and the City, completes a significence evaluation . the finds pursuant to Section 106 of the National Historic Preservation A. Any human remains unearthed shall be treated in accordance with California Health and Safety Code, Section 7050.5, and California Public Resources Code, Sermons 5097. 94, 5097.98, and 5097.99, which include requirements to notify the Santa are County ,'':'i;:9"office and consult with Native American represenistives determined to be the Most Likely De scenda nts, as appointed byte Native American Heritage Commission. Identified cultural resources shall be recorded on State Department of Parks and Recreation Form 523 (archaeological sites). Mitigation measu res wed by the Native American Heritage Commissio n, the Santa Clare County Medical Examiner's • office, and any Native Ame rican represe ntatives determined to belie Most Likely Descendants and required by the City shal be undertaken before construction activities are resumed. If disturbance of a project area cultural resource cannot be avoided, a mitigation program, Including measurer set forth In the We Cultural Resources Mana gement Program and in compliance with Sections 15064. 5 and 15126.4 of the CEQA Guidelines, shaft be implemented. APPikent City of Palo Alto . Prior to and during earth disturbance • Training materials provided to construction contractors • Field inspections conducted to verify compliance Ltd 67747 PROJECT: Customer Oweloer&shao Attn: Elisabeth Wong _ Address: 429 University Ave _ _ _ City: _ Palo Alto_ _ State CA ZIP -__- Phone: 650.814.3051 Email: alitat^rinsona^i'1S^cernaii.-rnn Qty 1020 Ruff Dr San Jose. CA 06110 Office (408) 377-9990 Fax (108) 4924008 ;PROPOSAL Misc. Date 10/30/2018 Order No. AC -16.378r1 Rep Sob Hardesty Review • • • • • • f • • • Excludes •w M f SCOPE OF WORK: Install a new manhole in the street and a sewer lateral with on -site install, per City permits. Able to mark out the construction area 48 hours prior to any digging. Able to -pull the permits needed to complete this project (permit cost excluded. Able to set up traffic control, lay out trench line and saw cut asphalt before digging. Able to dig, trench and install a•4" sewer lateral approx. to 26' in length and approx. 6' deep. Able to backfitl with proper materials and compaction to be mechanical. Able will off haul all spoils related to this job. Able to use proper shoring on ail trenches 8' or deeper. Able to pave around newly installed manhole and new sewer lateral. Able to replace small section of driveway approach. Able to reconnect 4 existing sewer fines that are to be reconnected to our new sewer line. , f _ , Able to install one new sewer manhole to City of PA specs. �1'W Able to use native backfill on the on -site sewer and replace the concrete" thick thru the trench line only. Compaction to be mechanical. Able to dig, trench and install a 8" sewer line approx. 115' in length and approx. 6' deep. We are estimating this project to take 5 to 6 working days to complete. Able to provide traffic centre! plan to customer before submission to the City. Able to pro v'de certificate of Ins. With customer provided additional insureds upon sinning cif the pi.optisa. Permits, fees or engineering if needed. Some ?land digging, is included Any concrete thicker that 6". Any utilities that will cause use to hand dig through our trench line. This bid is for tractor work. Hitting any unmarked utilities lines in our trench ansa. Please note, we have excluded the cost to abandon the existing line until we get clarification. lirmis and Ground Wear Clause If roeklground water is found, alternate methods may be applicable. If found, additional charges may be needed. Chance orders Any aItsM3ons or deviations from this proposal, involving additional materials andior labor will be executed only in a written charge order and will become an additional charge outside the original proposal cost. Any additional down time created by a change order will be payable by the customer per our standard time and materials rates. Thank you for giving us the opportunity to bid on your underground sewer project. 1 Thank You fot THANK YOU FOR CHOOSING ABLE UNDERGROUND CONSTRUCTION tAnimproutuf f`.Q S s• tearer - Stem • idler • E.4 -dater & ktskale Sttptft Spate= reared • ke wif • &wad Ai • fraccatla Pravutting Sumo & D:iix unit C ea.-.iy • R.7Wog - ReNlidS1 • &Paw • Rifkaana, 4 Cornice; sett usi r Sot. s r&orn ..rsfiszsebesiterreirems *rev R kL Sew- Ma a v • P,sbSG' *Wks • Orerxx'* & Sp efe f.A11.A.r Stoppage: Piped Viik fuspectina: ftelone Inspection • ;.triv .11ratr!i • Aguirre SS Cowles, 3 f6: EmaugensyS+art*. Wt7W..:?i0:Si1 (1..±•L?tv /ltd ckaA4:v114c. at • Yrisula.'{Ai18pcoR+i3O*4.noto CITY OF PALO ALTO 11F UTILITIES Inspired by a b•ighter tomorrow. DEMO DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Street # Street Name NI v5As I flite1/ P A4,110, C " Palo Alto Municipal code 16.04.060 section 105.1.3 provides no work or demolition shall begin upon any portion of such a unit until each and every portion has been vacated by all tenants laaxfully in possession thereof. 1azttioe4) L)0 hereby declare that I am the oVNner, or owner's agent. of the premises located at the servic address listed abo‘c. I also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise Consists of 1 number of buildings I will not use not use any demolition permit issued to aid in securing vacation of said premise. I certify under penalty or perjury that the foregoing is true and correct. 5I1249/LA GvflnL, /114Aailr Print Name, Signature fflLe -30r/ Phone Number City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto. CA 94301 Tel. 650 329-2161 Fax. 650-321-2786 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 5:00 pm Email: UtliitiesCustomerServicencitvofpaloalto.orq Web: http://www.citvofpaloalto.orsi/depts/ut&default.asp Rev 12/2/2016 DEMO �'��►�` UTILITIES Utilities Disconnection Prior Inspired by a brighter tomorrow. To Building Demolition/Remodeling L/ M ,:rj Aeyej A-t4u Service Address (P?A Lt 3S j 4'i j tf' # U/1 N/1rl r7y Awe., at) 1140 All addresses on the property being demolished need to be listed. A separate Demo application is required for each address. ❑ Single Family Dwelling 0 Multi Family Dwelling 35(Conunercial Building Applicant Name 0(2010c -"A ODA) t H 42110.50 -- et,‘ Owner Name Phone Phone ~ V I y -3cr' eV) F 9oi / Billing Address 0. e•ox 70(e, Pc - W A- IA, C46- Q `P3 c7 y Email Address ell ?.fit-t>e-(1 alp ..2-coct I. q m Q i L . C J- f Services Requested for Removal (Check all applicable boxes) W.Remove Electric Meter # Er/Remove Gas Meter # 0 Remove Water Meter # move Electric Service Line Remove Gas Service Line Utilities will be disconnected and/or removed within 1 and 10 working days after receipt of a completed application. Exact times and/or dates cannot be scheduled. If uti Signature (Applies General Information Will there be multiple or new address(s) when construction is complete? Will you need temporary power during construction? Have you applied for a building permit? Will the foundation be removed? be reinstalled, a connection fee will be charged per current utility rate schedule. // 113 Date No No No No What is the purposed property use after demolition? (Example: single family home, restaurant) City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 Fax 650-617-3142 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 4:30 pm Email: UtilitieeCustomerService(a/citvokaloalto.orq Web: htto://www.cltvofualoalto.orb/deots/utl/default.aso Rev 8/16/2017 1111 CITY OF PALO ALTO V' UTILITIES Utilities Disconnection Prior DEMO Inspired by a brighter tomorrow. To Building Demolition/Remodeling upNersrry ,w, adz A -U Service Address ) tf , V? j (4,3 c j 41-11 e-7 Un i vers , jy Ave, j etc) l 'tfo All addresses on the property being demolished need to be listed. A separate Demo application is required for each address. 0 Single Family Dwelling 0 Multi Family Dwelling XCommercial Building Applicant Name i e4 1001, r M Qnaj8 P.r uc— e0 b1- Gr Owner Name Phone " �i y -3car / Phone 6.0 ' c 1 - 3 Q1-/ Billing Address O. Oox 7.1)(e, (78.-L A' ("lb) e p- q Y3 a 2,za.1 4-11 cap( - Email Address Services Requested for Removal (Check all applicable boxes) 'Remove Electric Meter # Remove Gas Meter # 0 Remove Water Meter # ove Electric Service Line Remove Gas Service Line Utilities will be disconnected and/or removed within 1 and 10 working days after receipt of a completed application. Exact times and/or dates cannot be scheduled. If 'li es ar to be reinstalled, a connection fee will be charged per current utility rate schedule. -z/2c/: Date Signature (Applic General Information Will there be multiple or new address(s) when construction is complete? Will you need temporary power during construction? Have you applied for a building permit? Will the' foundation be removed? No No No No What is the purposed property use after demolition? (Example: single family home, restaurant) City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 Fax 650-617-3142 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 4:30 pm Email: UtititiesCustomerService(Wdtvoraaloalto.orq Web: htta://www.citvooaloalto.oro/deots/uU/default.aso Rev 8/16/2017 • \1//i CITY OF PALO ALTO '/!1>` UTILITIES Inspired by a brighter tomorrow. %tLf/ Street # '�F Street Name OIUt✓ER*S I' I farvg eadz �i ck DEMO DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Palo Alto Municipal codc 16.04.060 section 105.1.3 prov ides no work or demolition shall begin upon any portion of such a unit until each and every portion has been vacated by all tenants lawfulb in possession thereof. I ) tz4ioeJh 4), hereby declare that I am the owner. or owner's agent. of the premises located at the scrvic address listed above. I also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise Consists of 1 number of buildings I will not use not use an demolition permit issued to aid in securing vacation of said premise. I certify under penalty or perjury that the foregoing is true and correct. 5II2 LA tvo ij, fl 4 55 Print Namc 6ro- fit--3a"f Phonc Number City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 Fax. 650-321-2786 Hours Mon — Thur 7.30 am to 5:30 pm Friday 8:00 to 5:00 pm Email: UtilitiesCustomerService@citvofoaloalto.org Web: htto://www.citvotaloalto.oraidePts/uti/default.aso Rev 12/2/2016 DEMO CITY OF PALO ALTO UTILITIES Utilities Disconnection Prior Inspired by a brighter tomorrow. To Building Demolition/Remodeling 4-r;'11vNers):11 kite.; adz 0011/1110 Service Address 44211) q 9.,c) ) Let -f7 U/1 i very i Awe. , et() kifo All addresses on the property being demolished need to be listed. A separate Demo application is required for each address. 0 Single Family Dwelling 0 Multi Family Dwelling XCommercial Building Applicant Name CJt2'e "' LUD1 t tl angl Phone Owner Name ! -� '( t �� Pn LP Phone ' 3 o (ate- / y -3ar Billing Address Email Address o. eCkx 7Dte, GAO A- c- 1 ca- a 0z e!t2aLe7 i conk ?co't Q jmQi 1. �M l Services Requested for Removal (Check all applicable boxes) Remove Electric Meter # I''Remove Gas Meter # 0 Remove Water Meter # move Electric Service Line 0 Remove Gas Service Line Utilities will be disconnected and/or removed within 1 and 10 working days after receipt of a completed application. Exact times and/or dates cannot be scheduled. If utilitie : re toe reinstalled, a connection fee will be charged per current utility rate schedule. 1124 Signature (Applicant) neral Information Will there be multiple or new address(s) when construction is complete? Will you need temporary power during construction? Have you applied for a building permit? Will the foundation be removed? Date No No No No What is the purposed property use after demolition? (Example: single family home, restaurant) City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 Fax. 650-617-3142 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 4:30 pm Email: UtilitiesCustomerServiceecitvofoaloalto.orq Web: htta://www.citvofoaloalto,oraldeots/utlldefaultaso Rev 8/16/2017 DEMO CITYOFPALO ALTO O UTILITIES Inspired by a brighter tomorrow. DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Street #:00111 Street Name unit vegs 1 'r`'( tbNe t P� A -C/11), ciet- Palo Alto Municipal code 16.04.060 section 105.1.3 provides no work or demolition shall begin upon any portion of such a unit until each and even portion has been vacated by all tenants lawfulh in possession thereof. I g) eel:4 00 her* declare that I am the owner, or owner's agent, of the premises located at the sen-ic address listed above. I also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise Consists of 1 number of buildings I will not use not use ant demolition permit issued to aid in securing s aeation of said premise. I certify under penalty or perjury that the foregoing is true and correct. 5It2s�e- tOonj, f(4ra5e Print Name Signature 60- !N -3a-j Phone Number City of Palo Alto Utilities, Customer Service Center 250 Hamilton Ave., Ground Floor, Palo Alto, CA 94301 TeI. 650 329-2161 Fax 650-321-2786 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8.00 to 5:00 pm Email: UtilitiesCustomerServicel6tcfirofpaloalto.orq Web: http://www,citvofpaloalto.ora/depts/utl/default.aso Rev 12/2/2016 DEMO CITY OF PALO ALTO UTILITIES Inspired by a brighter tomorrow. DECLARATION CONCERNING TENANCY OF BUILDING PRIOR TO ISSURANCE OF A DEMOLITION PERMIT Service Address for Demolition/Remodeling Street # Street Name (WI t ✓Ei S 1 Dj g 19,40 IQ's , Palo Alto Municipal code 16.04.060 section 105.1.3 provides no work or demolition shall begin upon any portion of such a unit until each and every portion has been vacated by all tenants lawfully in possession thereof. I g) 124164) &)o il' hereby declare that I am the owner, or owner's agent, of the premises located at the servic, f address listed above. I also declare the building located at the service address listed above, for which a demolition permit is requested, is not currently occupied or presently being used for residential purposes. Said Premise Consists of 1 number of buildings I will not use not use any demolition permit issued to aid in securing vacation of said premise. I certify under penalty or perjury that the foregoing is true and correct. Elie , GUoj, Print Name Signature loo- g/ -3tar/ Phone Number -7/7-4-1/? City of Palo Alto Utilities, Customer Service Center 250 Hamltton Ave., Ground Floor, Palo Alto, CA 94301 Tel. 650 329-2161 Fax. 650-321-2786 Hours Mon — Thur 7:30 am to 5:30 pm Friday 8:00 to 5:00 pm Email: UtilitlasCustomerServicettcitvofnaloalto.org Web: httpJ/www.citvafpaloalto.ora/deot$A4Udefault.aea Rev 12/2/2016 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Todd Rothbard 27 Attorney et Law 100 SagaAvoaue 28 Subs 200 O 2 a dart California p5051 TODD ROTHBARD *67351 ATTORNEY AT LAW 100 Saratoga Avenue #200 Santa Clara, California 95051 Tel.: (408) 244-4200 Attorney for the Plaintiff t .. SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA, STATE OF CALIFORNIA KIPLING POST, LP, ) Plaintiff, ) No. 18CV329356 vs. ) STIPULATION AND ORDER DESIGN WITHIN REACH, INC., DOES I ) through V, inclusive, ) Defendants. ) IT IS HEREBY STIPULATED. AND AGREED, by and between plaintiff KIPLING POST LP and defendant DESIGN WITHIN REACH, Inc. that: 1. Defendant and all occupants will vacate the premises located at 447 University Avenue, Palo Alto, Santa Clara County, California 94301 on or before July 15, 2018 (hereinafter "the vacate date"). Notwithstanding that the vacate date falls on a Sunday, there shall be no extension of this limit to the following working day. Defendant shall turn in all keys to said premises to plaintiff or plaintiff's agent at such time as it leaves, and shall leave said premises in broom clean and undamaged condition, ordinary wear and tear excepted, and shall comply in all respects with any requirements set forth in the lease. respecting the manner in which possession of the premises 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Todd Rothbard 27 Attorney at Law 1005 Saratoga 28 Solo'Ma Cdr. California 93051 is to be restored to plaintiff. Defendant shall remove all items of personal property from said premises at such time as it leaves; any items of personal property remaining behind after the vacate date may be disposed of by plaintiff without liability and without need for resort to the procedures set forth in Civil Code sections 1993, et. seq. 2. Defendant shall pay to plaintiff, on or before June 15, 2018, the sum of $63,875.52. This sum is comprised of holdover rent from June 1 through July 15 ($59,445.72), reimbursement for plaintiff's attorney's fees ($3,500.00), reimbursement for plaintiff's Court filing fee ($435.00), reimbursement for defendant's Court filing fee ($435.0Q) and reimbursement of ex parte fee ($60.00) . 3. If defendant pays and leaves as set forth above, upon the completion of performance by defendant and upon written demand to plaintiff's attorney by defendant or its attorney, plaintiff shall file a dismissal of this action, with prejudice, with no further award of fees or costs in favor of either party. 4. If defendant fails to pay or leave as set forth above, .or if any check given by defendant in payment of all or any part of any amount due as set forth above is returned unpaid by the bank upon which drawn, in any such event plaintiff shall be entitled to immediate judgment for the full relief set forth in the complaint, including restitution of possession of the premises, unlawful detainer damages, attorney's fees, and costs, less applicable credit(s) for any payment(s) made by defendant prior to the date upon which such payment is obtained. Plaintiff may obtain said judgment by ex parte application to 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Todd xothbard 27 Attorney at Law 100 SamWp Avenue 28 Seim 200 nits CIxa, Ca1itaa1a 95051 the Court, coupled with a declaration under penalty of perjury setting forth the facts constituting defendant's failure to perform in accordance with the foregoing requirements. Before seeking to obtain said judgment, plaintiff's attorney shall give notice by telephone and email to defendant's attorney (Ms. Jill Rowe, Cooper, White 4 Cooper; tel.: 415-765-6239; email: jrowe@cwclaw.com) of plaintiff's intention to so proceed. If defendant fails to perform in accordance with the foregoing requirements, defendant waives any right it might otherwise have to contest, appeal, or seek to set aside said judgment, waives any right it might otherwise have to seek any form of stay of execution, either pursuant to Code of Civil Procedure sections 918, 1176, or otherwise, waives any right it might otherwise have to seek any form of relief from forfeiture, either pursuant to Civil Code section 3275, Code of Civil Procedure sections 1174, 1179, or otherwise, and waives any right it might otherwise have to seek any form of relief from default, either pursuant to Code of Civil Procedure sections 473, 473.5, or otherwise. 5. Time is of the essence with respect to the provisions of this STIPULATION. This provision shall be interpreted in its strictest sense, with any failure to perform any requirement set forth herein on or before the date upon which performance is due, even if performance is late by only a single day, resulting in the relief upon default set forth above without regard to the relative hardship to the parties. 6. Other than with respect to a violation of the foregoing requirements, both parties waive any and all claims, of any 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Todd Rothberd 27 Aaomey atLnw Sang°` Avnne 28 Suite 200 mn O,n. CaHfoxr i 95RSI nature whatsoever, which each might have against the other, or against any principals, agents, shareholders, partners, managers, members, employees, affiliates, or assigns of the other. The parties understand that California Civil Code section 1542 provides: "A general release does not extend to the claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor." Notwithstanding this language, the parties specifically waive its protection. The parties understand that they may have sustained serious damage or consequential injuries which have not manifested themselves and/or which are presently unknown, but nonetheless deliberately intend to and do hereby release these possible future claims. 7. Each of the terms and conditions set forth above is a material part of the consideration for the execution of this STIPULATION. Strict performance of each and every term and condition set forth above is required. The failure to perform in strict compliance with each and every condition set forth above shall be deemed a material breach of this STIPULATION entitling plaintiff to the relief upon default set forth above. 8. This STIPULATION sets forth the entire agreement between the parties with respect to the matters addressed herein. It shall not be altered nor modified unless such alteration or modification is in writing and signed by all signatories hereto. 9. A fax or email copy of this STIPULATION, bearing the faxed or emailed signatures of all signatories hereto, may be 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ToddRofbbnd 27 at Lew �� 28 Sam Clam. Otlizasa9303L used for all purposes in lieu of an original. This STIPULATION may be executed in counterparts, with the sum of the counterparts, whether executed by fax, email, or otherwise, being the equivalent in legal contemplation of one fully executed original. DATED: DATED: DATED: DATED: ti i$ -L61 KIPLINd P Plaintiff Attorney for Plaintiff DESIGN WITHIN REACH, INC. Defendant JILL ROWE COOPER, WHITE & COOPER Attorneys for Defendant /"iGP Lhpk. �tl j GCS Gird ORDER POALS np'2t._ r The Court having and and reviewed the foregoing STIPULATION of the parties, and good cause appearing therefor, IT IS SO ORDERED. DATED: 'JUN 13 2018 5 JUDGE OP THE SUP used f9r all ,purposes• in lieu of an original. This STIPULATI©N 2 inay 1Se eXecuted in counterparts, with the sum of the 3 counterparts,, whartbex execut 4 :by a , ?mail., or oth rwise, 4 being the equivalent in legal .contemplation. of one fully axeclited b�iinat 6 DATED: 7 8 9 10 •bA1LED: 11- 12 '1.3 14 : TATEb.: 7v.n/t Z n i e 15 16 17 DAB :j4k4 6, .01 18 19. 20`. ORDER CPY,i�G .PAST, DP Plaintiff '£6D "R D A4 -or ey.: for Plaintiff DESIGN' WITHIN' p INC. Defe7ndanit LO1.1 frte. 4124%17, .CF SAI- WRITE. Jr 000MAttorneys for Defendant Al The. .& urt having read. and reviewed the foregoing 22 STIPULATION a the and goQa caue& :appearing. therefor, 23. IT Is 30 ognmiEA . 24 26 . DATED : 26 zvdd.Itab011 2'l dgomq� W i�w tsx Odliaee.sgixt Gt)k c-bil Ko Architects, Inc. September 1, 2017 Mrs. Elizabeth Wong ' Kipling Post LP, Successors and Assigns RE: 425-429 University Mixed Use Project in Palo Alto Dear Elizabeth, s Thank you very much for considering us to provide architectural services for construction documents of a mixed use project located at 425-429 University Avenue In Palo Alto, Califomia. Please find the enclosed service proposal for your review and approval. We will proceed with the design services upon receiving your signature on our agreement We are looking forward to working with you on this exciting project. Please contact us if you have any questions. Sincerely, Peter Ko, AIA, LEED AP Principal Ko Architects, Inc. 1 900 High Street, Suite One, Palo Alto, CA 94301 Tet 650/853-1908 Emelt designgicoarch.coml PROJECT MANAGEM ENT FLOW SCHEDULE: 2017-2018 DATE: 8eptsmbsr 8 th, 2017 CLIENT: KipOng Post LP, Successes & Assigns PRO JECT: 429 Unh emity Mixed Use Porleet (KAI 17-721) PREPARED BY: Ko Architects, Inc. 2017 2018 TA61vraIE 1:1•9 OCT . NOV . DE C. JAN. FEB . MARC H APRL AMY JUNE JULY AUG . SEPT. OCT. N OV . DEC. 0/1 9110 10/1 10/10 11 11 11/10 12/1 12/16 1/1 1116 2/1 2/10 3/1 3/16 411 4110 511 5110 6/1 0116 7 11 7/16 6/1 N10 0/1 010 1011 10116 11/1 11/10 12/1 12/10 TASK 1: DESIGN DEVELOPMENT -DESIGN 3MTH CONSULTANTS) TASK 1: DESIGN DEVELO PMENT- CLIENT REVE IMC DM.EN TB TASK 1: DEMON DEVELOPM ENT - DESIGN REVISION¢ TASK 1: DESIGN DEVELOPM EN T- CU ENT/COMTR ACTOR APPROVAL• TASK 2: CONSTRUCTION DOIIAENTs- DESIGN MTTH CONSULTANTS) TASK 2 CONSTRUCTION D OCUMEN TS -• . R EVIEW/COMMEN TS • TASK 2 CONSTRUCTION DOCUMENTS - DESIGN REVISIONS TASK2: CONSTRUCTION DOCUM ENTS- CU ENT ONTRACTORPPPROVAL• TASK 3: DIADEM PERMIT SU BMITTAL IL CO MMENTS • TASK 3: PLAN CHECK RESPONSE & REVISIONS ION r TASK 3: BUILDIN G PERMT APPROVN. • TASK 4: BIDDING AND NEGOTIATION -SUBCONTRACTORS TASK 5: START CON STRUCTION • NEST. 22 MONTHS CONSTR. TIME) • NOT CONTROLLED BY KOARC HITEC TS, WC. , Anticipated Protect Milestone Dates; TASK 1: Complete DD phase TASK 2: Co mplete CD phase TASK 3: Bulidin g Permit Submittal: TASK 3: Provide Bid Seta (For C ontracto r): TASK 3: City FIRS) Appro val (Budding Permit): TASK 4: Bidding and Negotiation - Subcontractors TASK 5: Demolition start: Nov. 1st, 2017 Feb. 15th, 2018 Fe b. 15th, 2015 Marcb 1st, 2018 May 10, 2018 March 1st, 2018 April 15th, 2018 Contract for CALGreen Tier 2 and CALGreen Consulting Services This Agreement is made on April 26, 2018 by and between Elizabeth Wong the ("Client") and Kate Latham ("Consultant"), for the property at 429 XJniversity Avenue, Palo Alto, CA 94301, which is under the building jurisdiction of City of Palo Alto ("CPA"), with reference to the following: 1. Project Sco Client's intention is to have a CALGreen Tier 2 certification for a three -unit, 8,100 112, new construction residential proj , t as required by the 2015 CPA Green Building Ordinance effective June 22, 2015. 2. Scope of CALGreen Tier 2 Consulting Services: Consultant agrees to provide the following consulting services required to obtain a CALGreen Tier 2 certification: • Work with Client's project team to develop a cost effective CALGreen Tier 2 checklist that meets the requirements of the Ordinance for the specific buildinwproject noted above and the Client's needs. • Revies, Client's plans prior to submission for a building permit and suggest CALGreen Tier 2 notes for architectural plans. • Review Title 24 (T2.4) CF -1R for submission with GB -1 Application if necessary. • Assist }vith preparing the Client's CA,LGreen Tier 2 checklist sheet for submittal for building permit and provide preparation assistance and signatures. • Prepare and provide detailed CALGreen Tier 2 checklist requirements for project specific CALGreen Tier 2 measures and conduct preconstruction meeting with contractor and Client. • Coordinate and lead the three mandatory inspections required by the City of Palo Alto (CPA), which include CPA Green Build i g Inspector. • Prepare and provide detailed list of requirements for project specific CALGreen Tier 2 measures for preconstruction meeting. • Provide timely CALGreen Tier 2 rater documentation and signatures for all the steps required in the Green Building Certification Summary on CPA submittal sheet GB -1 CALGreen Tier 2. • Conduct site field inspections as part of basic CALGreen Tier 2 certification fee including pre -construction meeting with contractor. • Conduct required CALGreen Tier 2 inspections in a timely manner. • Assess whether each CALGreen Tier 2 measure applied for meets the detailed CPA requirements based on the CALGreen Tier 2 Manual and if not, provide suggestions of what CALGreen Tier 2 measures could be chosen by Client to meet the CALGreen Tier 2 requirements. • If necessary, arrange for HERS inspections as required by the T24 report. • Prepare comprehensive project documentation for each CALGreen Tier 2 measure certified with assistance from Client's project team for review by CPA. The role of the CALGreen Rater is primarily as a verifier. It is the responsibility of the Client and their contractor to provide written documentation of compliance with checklist requirements in the form of invoices, product labels and specifications, dump tags, etc. unless they can be confirmed onsite by the Rater through inspections and photos. • Prepare and submit final project certified CALGreen Tier 2 checklist and all documentation to CPA for review demonstrating that project has met the minimum CPA green building ordinance. • Maintain project documentation for 5 years in anticipation of CALGreen Tier 2 CPA project audit. 3. Fee for CALGreen Tier 2 Consulting Services: The basic CALGreen Tier 2 certification fee will be $3,200.00 for Client's project as defined above and that meets the CALGreen Tier 2 certification requirements in effect at the time of this agreement. 4. Payment Schedule: Client is to pay Consultant on the following schedule: • $960.(0 (30%) upon acceptance of this proposal • $1,60 .00 (50%) at time of rough inspection with City Inspector • $640.00 (20%) due before final Cal Green building inspection 1.Co ikc h1 T.41c� Client: Elizabetth Wong Consultant: Kate Latham 429 UniversitytAvenne, Palo Alto kate(Jlathamhomerating.com 1650-450-1827 P 1 /{ 146. t I . dl.tdiu m, Signature: Date: Date: 4/26/2018 If proposal is acceptable, checks may be made to `Latham Home Rating' and sent to: Kate Latham at 765 N. RengstoriAve. #22, Mountain View, CA 94043 Ex. D Task Building Review Elect Utilities Review Fire Review • Planning Review • Public. Works Eng. Review Water Quality Review WGW Utilities Review Landscape Review Urban Forestry Review Ready To Issue Permit Issuance Structural Structural Architectural Mechanical/Plumbing Electrical Structural Archrlectural Mechanical/Plumbing Electrical 18000-00536 - KIPLING POST LP Task Building Review Elect Utilities Review Fire Review 1 Planning Review • • Public Works Eng. Review Water Quality Review WGW Utilities Review Landscape Review Urban Forestry Review Ready To Issue Permit Issuance 18000-00537 - KIPLING POST LP Status Approved Approved With Conditions Approved Inspection Re... Not Approved Not Approved Approved Inspection Re... Approved With Conditions Not Required Approved Approved Approved Approved Approved Approved Approved Approved Approved Approved Status Approved Not Approved Not Approved Approved Approved Status Date Action By 10/05/2018 04/05/2018 06/29/2018 09/17/2018 09/26/2018 03/16/2018 08/03/2018 06/07/2018 06/25/2018 08/02/2018 07/13/2018 08/02/2018 08/02/2018 08/02/2018 08/01/2018 08/01/2018 08/01/2018 08/0112018 DAVID CHU... DANIEL ER.. HENRY RAF... ADAM PETE... PAIGE SAF... BRIAN JON... JOHN NGUY... KELSEY AN... WALTER PA_. MEDHAT HE.., MEDHAT HE... DAVID CHU... DAVID CHIC... DAVID CHU... DAVID CHU... DAVID CHU... DAVID CHU... DAVID CHU... Status Date Action By 08/06/2018 GOPAL JAG... 09/17/2018 ADAM PETE... 09/11/2018 PAIGE SAF... 08/17/2018 JOHN NGUY... 07/25/2018 WALTER PA .. Attachment H Project Plans Hardcopies of project plans are provided to Council members. These plans are available to the public online and/or by visiting the Planning and Community Environmental Department on the 5th floor of City Hall at 250 Hamilton Avenue. Directions to review Project plans online: 1. Go to: bit.ly/PApendingprojects 2. Scroll down to find "429 University Avenue" and click the address link 3. On this project specific webpage you will find a link to the project plans and other important information Direct Link to Project Webpage: https://www.cityofpaloalto.org/news/d isplaynews.asp?NewsID=4338&targetlD=319 CITY OF PA LC A LTC City of Palo Alto (ID # 9890) City Council Staff Report Report Type: Action Items Meeting Date: 12/3/2018 Summary Title: 2018 Comp Plan Implementation/Housing Ordinance (First Reading) Title: PUBLIC HEARING: Adoption of an Ordinance Amending Various Sections of Title 18 of the Palo Alto Municipal Code Related to Residential and Mixed - use Development Standards Including, but not Limited to, Minimum and Maximum Unit Density, Unit Size, Floor Area Ratio, Height, and Open Space Including Rooftop Gardens; Parking Requirements Including, but not Limited to, Regulations Related to In -lieu Parking for Downtown Commercial Uses and Retail Parking for Mixed Use Projects; Exclusively Residential Projects in Certain Commercial Zoning Districts; Ground -floor Retail and Retail Preservation Provisions; the Entitlement Approval Process; and Other Regulations Governing Residential, Multi -family Residential and Commercial Zoning Districts, all to Promote Housing Development Opportunities in These Zoning Districts in Furtherance of Implementation of the Comprehensive Plan. CEQA: Determination of Consistency with the Comprehensive Plan Environmental Impact Report (EIR) Certified and Adopted on November 13, 2017 by Council Resolution No. 9720. The Planning and Transportation Commission Recommended Approval of the Proposed Ordinance on October 10, 2018 (Continued From November 26, 2018) From: City Manager Lead Department: Planning and Community Environment Recommendation Staff recommends that the City Council: 1. Find the proposed ordinance is consistent with the Comprehensive Plan Update Final Environmental Impact Report. 2. Adopt the attached ordinance (Attachment A) City of Palo Alto Page 1 Executive Summary The draft ordinance is intended to create additional opportunities for new housing production to complement other policy initiatives approved by the City Council this year. While significant changes are proposed to advance housing goals, this set of policy changes alone is not expected to create the number of annual housing units anticipated from the Comprehensive Plan update. Existing policies and market conditions continue to favor commercial development over housing particularly downtown and in the California Avenue area. Additional gains in housing development can be achieved with additional changes to parking, floor area and height standards. However, such modifications would benefit from additional public comment. The value of the proposed ordinance is that it streamlines project review, increases unit density, adjusts parking requirements to be more aligned with industry standards and modifies other development regulations that constrain housing development. It increases floor area for housing projects (on par with existing floor area standards for commercial development) and preserves local control of the design review process. The building volume that exists in the code today with respect to setbacks, height, and daylight plane are generally preserved. In short, the proposed ordinance makes gains toward increased housing production while balancing interests to preserve neighborhood character. This report summarizes work completed over the past year to develop the 2018 Comprehensive Plan Implementation/ Housing Ordinance. 1. The Background section of this report summarizes the following items: a. The purpose of the Housing Work Plan b. Work completed by the Architectural Review Board and Planning & Transportation Commission on drafting the 2018 Comprehensive Plan Implementation/Housing Ordinance c. Findings and outcomes from advisory meetings with developers and architects, and with the community at -large d. Findings from an evaluation of parking demand and supply in multifamily developments in Palo Alto. 2. The Discussion section presents zoning revisions identified in the ordinance in Attachment A that meet the intent of the Housing Work Plan and describes the rationale for each zoning change. 3. The Analysis section analyzes potential impacts of the draft zoning revisions, including how the revisions would increase housing production and affordability, and implications City of Palo Alto Page 2 under State Density Bonus Law and SB35 streamlining provisions. Additionally, massing models of how hypothetical sites could buildout under existing and proposed standards are provided in Attachments B and C. The ordinance proposes a variety of changes to the multifamily zoning districts and certain commercial zoning districts in Palo Alto as well as some broader citywide changes, all to encourage housing production. Due, in part, to the scope of the ordinance, potential conflicts of interest are implicated for several members of the Council with respect to different portions of the ordinance. This necessitates the structuring of the Council's consideration of the ordinance as follows: after the staff presentation of the entire ordinance and public comment, the Council's discussion, deliberation and vote on the ordinance will be segmented to allow Councilmembers to participate in those portions for which they do not have a conflict; specifically, the Council will be asked to segment the matter into four parts: (a) proposed changes specific to the Downtown CD -C zoning district, (b) proposed changes specific to the California Avenue CC(2) zoning district and sites on El Camino Real zoned Neighborhood Commercial CN and Service Commercial CS, (c) proposed changes specific to the Multi -family Residential RM zoning district, and (d) proposed citywide changes. During each of the first three portions, the conflicted Councilmember(s) will leave the public hearing. Thereafter, the Council as a whole will consider the fourth part, the proposed citywide changes. While this may appear cumbersome, this is necessitated by the conflict of interest rules while maximizing Councilmember participation as allowed and feasible. Background On February 12, 2018, the City Council approved a Housing Work Plan, which outlined steps to implement the City's vision and adopted policies and programs for housing production, affordability, and preservation. The Work Plan included select policies and programs from the adopted Comprehensive Plan, adopted Housing Element, and a City Council colleagues' memo issued on November 6, 2017. February 5, 2018 City Council Staff Report and City Council Colleagues' Memo https://www.cityofpaloalto.org/civicax/filebank/documents/63054 Draft Housing Work Plan (February 2018) https://www.cityofpaloalto.org/civicax/filebank/documents/63027 February 12, 2018 (as continued) City Council Action Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/63659 The Work Plan describes the City's progress towards the housing production goals at various income levels (i.e. Regional Housing Needs Assessment, or RHNA). The Work Plan also explains the City's progress towards the housing projections developed during preparation of the updated Comprehensive Plan (i.e., 3,545-4,420 new units between 2015 and 2030). In both City of Palo Alto Page 3 cases, the City is behind in its effort to meet these goals. The approved Housing Work Plan indicates what action is needed to spur housing production. This report and the draft ordinance attached for the Council's consideration represents one aspect of the Work Plan. PTC and ARB Referral The City Council referred specific Work Plan items to the PTC that would be included in the subject ordinance. The PTC held seven meetings to analyze various aspects of the Work Plan and to consider possible zoning changes to facilitate implementation of both the Work Plan and (by extension) the Comprehensive Plan housing production targets. The Architectural Review Board (ARB) also reviewed draft open space standards. A summary of previous study sessions is provided with links to the staff reports and attachments: 1. March 14th: The PTC discussed the Work Plan goals, timeline, and the PTC's role in implementation. Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/63859 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/64589 2. April 25th: The PTC discussed key issues in the zoning code as they relate to the Council referral, including issues regarding development standards and the entitlement process. Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/64680 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/65784 3. May 30th: The PTC discussed parking topics as they relate to housing production, including a new study of parking occupancy in multi -family residential developments in Palo Alto. Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/65225 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/66124 4. August 29th: The PTC discussed a conceptual framework for the ordinance, including ideas for zoning changes to development and parking standards, use regulations, and the public review process. Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/66513 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/67075 5. September 20th: The ARB reviewed draft standards and guidelines for rooftop open spaces. Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/66725 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/67283 City of Palo Alto Page 4 6. September 26th: The PTC reviewed refinements to the conceptual framework for the ordinance. Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/66826 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/67266 7. October 10th (continued): The PTC recommended that the City Council adopt a draft ordinance. The ordinance provided to the Council in Exhibit A represents this ordinance with the PTC's recommended modifications. (See details in the Discussion section below.) Staff report and attachments: https://www.cityofpaloalto.org/civicax/filebank/documents/67132 Minutes: https://www.cityofpaloalto.org/civicax/filebank/documents/67665 The PTC endorsed the subject ordinance by a 5-1 vote (Commissioner Summa dissenting and Commissioner Riggs absent). This outcome was the result of several focused meetings that facilitated broad discussion and opportunities to focus on areas of shared support and disagreement. Throughout the process, Commissioners addressed the clear mandate from the Council and deliberated thoughtfully and at times compromising to advance the policy objectives. There are aspects of the ordinance that each Commissioner individually objected to and supported. The attached ordinance reflects the Commission's final recommendation. This report also includes site massing models requested by the Commission to illustrate how actual sites could build out under the revised zoning regulations. Community Outreach Staff conducted two complementary community outreach efforts, as directed by the City Council as part of Work Plan implementation: (1) meetings with individuals who regularly use the City's zoning code; and (2) a community meeting with the public at -large. Findings from these efforts are described below. (1) Advisory Meetings. City consultants conducted 16 meetings with 22 individuals (primarily architects and developers) in April and May 2018. Key findings were as follows: 0 PROJECT REVIEW PROCESS OPPORTUNITIES FOR INPUT What is it like today? What could change? • Generally, developers and architects agreed with the direction of the Council referral, including streamlining the review process and reducing zoning constraints. • Density and parking were cited as the major constraints lT PALO ALTO to configuring a site in terms of site planning, massing, and the number of units attainable. • There was a general sense that the current zoning does not support the City's stated goals of multi -family housing, and a recommendation that the City instead allow the City of Palo Alto Page 5 types of developments that it wants "by right" and/or through modifications to density, parking, and related standards. • Developers and architects expressed frustration about the length of time the entitlement process takes due to multiple reviewing bodies and instead recommended having one review body conduct design review based on a clear set of standards. A more detailed summary and list of advisory groups can be found in the September 29th PTC report, linked above. (2) Community Open House. On June 28, 2018, the City held a community open house on housing topics to describe the Housing Work Plan, present ideas for its implementation, and solicit feedback from community members on proposed ideas. Over 30 community members attended the meeting, which included a presentation, an open house of "idea stations" that allowed participants to interact with staff and other participants one-on-one or in small groups, and a debrief to share community members' comments. The presentation, idea station boards, and detailed feedback (in the form of notes taken by staff and individual feedback forms) may be reviewed on the project website: https://www.cityofpaloalto.org/gov/depts/pin/long range planning/housing programs and p olicies/housing work plan.asp Key findings are summarized below: • Participants expressed a range of perspective on housing needs and ideas to spur housing production. There was little consensus about how to implement the adopted goals of the Comprehensive Plan, Housing Element and direction proposed in the Housing Work Plan. • While some participants supported revisions to development standards and review processes to streamline housing production, others were concerned about impacts of new development on existing neighborhoods, traffic, and services. • Ideas for revisions to parking regulations had the greatest range in perspectives: some participants were concerned that reductions in parking requirements would lead to spillover parking in neighborhoods; others supported requirements that more closely matched demand, especially for populations with lower parking demand such as seniors, homeless, and low income households. A more detailed summary can be found in the September 29th PTC report, linked above. Evaluation of Parking Supply and Demand in Multifamily Housing Developments_The City engaged Fehr & Peers to study parking demand in multi -family developments in Palo Alto, including market rate, affordable, and senior housing projects located at varying distances to City of Palo Alto Page 6 transit. The purpose of the study was to provide another data point in the ongoing discussion regarding the relationship between parking demand and parking supply (i.e., is the amount of parking that the City is requiring and/or that developers are building too much, about right, or too little). Fehr & Peers, in coordination with City staff, selected nine sites/developments to observe. They counted occupied spaces at three time periods (midday, evening, and late night) on weekdays and at two time periods (midday and late night) on weekends. The report also reviews six other recent South Bay and statewide studies of parking demand and supply, including studies that made observations at other Palo Alto housing developments, and describes standard parking ratios issued by the Institute of Transportation Engineers. The PTC expressed two concerns about the first draft of the report. First, that it did not survey on -street parking spaces adjacent to each development. Second, that it did not consider residents behaviors to understand where residents park and why. In response, Fehr & Peers revised the study and conducted new surveys at eight of the nine apartment complexes to measure peak parking demand for both off-street and on -street spaces.' Most of the complexes demonstrated similar or slightly lower on -site parking demand between the previous surveys and the new surveys. In addition, Fehr & Peers conducted intercept surveys at one of the complexes, the Marc, to determine residents' perspectives on parking conditions.' Residents at this complex generally parked in the on -site garage since they have assigned spaces, feel safe, and can avoid the hassle of on -street parking. However, the sample size of one complex is too small to draw conclusions. Although anecdotally interesting, the supplemental parking information it fell short of the PTC's expectations to better understand tenants' perspectives. The Marc, located 0.7 miles from the Downtown Caltrain station. The project provides 0.92 parking spaces per bedroom, but has peak demand of 0.58 spaces per bedroom, suggesting an oversupply of parking. In conclusion, the study observed the following trends: 'One apartment complex had been sold since Fehr & Peers conducted the original survey; the new owners did not want to participate in the updated survey. Z For this in -person survey, Fehr & Peers intercepted residents in and near the project garage to ask questions about their perspectives on parking inside the project versus outside on the street. Only one property manager/owner allowed Fehr & Peers to conduct the intercept survey; the other eight declined to participate. City of Palo Alto Page 7 • On a per bedroom basis, the affordable and senior housing sites had comparable demand rates while market rate units had the highest rates. • Resident experiences at The Marc indicated that residents prefer to park at the apartment complex instead of on the street and that residents view having available parking/empty spaces any time of day as the "right amount of parking." • Parking supply exceeded peak parking demand in the developments surveyed. The study -helped inform the revised parking regulations presented in the draft ordinance, including reductions for senior housing based on evidence of lower demand. Coincidently, the revised parking requirements generally equate to those standards allowed under State Density Bonus Law. The complete parking report was presented to the PTC on September 29th and is directly available online: https://www.cityofpaloalto.org/civicax/filebank/documents/67711. Discussion These zoning revisions are proposed in parallel with several other zoning and policy changes to achieve Housing Work Plan, Comprehensive Plan, and Housing Element goals. Specifically, changes to local implementation of State Density Bonus Law, an updated Accessory Dwelling Unit Ordinance, an Affordable Housing Overlay, and a Workforce Housing Overlay are intended to facilitate affordable housing at varying income levels and market rate housing opportunities, consistent with the City's adopted policy. As these zoning changes are implemented through individual development projects, the City will continue to evaluate the effects of the code change, and make additional revisions over time, as necessary. Overview of Ordinance Organization and Purpose The ordinance proposes zoning changes by location and/or zoning district for: • Citywide - all districts where multifamily uses are permitted • Multi -family Residential districts - RM districts • Downtown - CD(C) • California Avenue - CC(2) • El Camino Real - CS and CN Revisions aim to increase housing production and shift redevelopment interests toward housing. The recommendations represent a modest step in that direction. However, City policy on commercial development, high property values, commercial rents, construction costs and other market influences may restrict efforts to expand housing opportunities without significant concessions on housing density and parking. The proposed suite of amendments is City of Palo Alto Page 8 intended to be considered as a complete package. Each concept is interrelated to site planning and housing production objectives, and eliminating one concept could limit the ordinance's effectiveness. The passage of SB 35 and other housing reforms requires careful examination of how changes in local housing policy may result in development that is larger than anticipated and permitted by -right. The recommendations below are intended to support State and regional housing policy interests, while ensuring Palo Alto retains local control of development with opportunities for analysis of project related impacts. Consistent with the 2018 Work Plan, the recommendations promote market rate and affordable housing unit production. Commercial floor area is not decreased, but residential uses may apply unused commercial floor area toward housing. Future policy direction may consider further incentives for housing by reducing the amount of commercial floor area that can be achieved. For example, on California Avenue, commercial land uses today can reach a 2.0 FAR. Raising the residential FAR from 0.6 to 2.0 FAR (as proposed) is helpful but is not likely to persuade a land owner redeveloping their property to build residential housing instead of commercial. Decreasing office floor area or significantly increasing residential FAR and likely height limits are standards that could be adjusted further in the future if the proposed changes and market conditions do not result in new housing projects. Summary of Proposed Zoning Code Amendments' Proposed zoning changes are described below. Detailed analysis of these concepts, including the rationale behind the changes, is provided in the Analysis section of the report. 1. CITYWIDE REVISIONS a. Open Space. Establish a consistent open space requirement for multi -family housing units in multi -family residential and commercial districts of 150 square feet (current code ranges from 100 to 200 square feet depending on the number of units provided). Micro units, defined herein as units with less than 450 square feet, are proposed to have a commensurate requirement of 40 square feet/unit. (See Table 4 in Analysis section.) 3 Detailed analysis of these concepts provided in the Analysis section of the report. City of Palo Alto Page 9 b. Review Process. Eliminate Site & Design Review, which currently applies to residential and residential mixed -use projects with 10 more units in commercial zones. Site & Design applications are reviewed by the PTC, ARB and City Council. By contrast, commercial -only development projects and housing projects in multi -family zones are reviewed only by the ARB. The amendment makes the review of housing projects (including mixed -use development) no more burdensome than the review process for commercial projects and retains options for appeals to Council. c. Retail Preservation. Exempt 100% affordable housing projects (120% AMI and below) from the retail preservation requirement except in the Ground Floor (GF) and Retail (R) combining districts, and on El Camino Real. d. Parking. Adjust multifamily parking requirements based on maximum anticipated demand. Coincidentally, the changes generally reflect the standards permitted by State Density Bonus Law. Other changes are proposed to incentivize affordable housing and reflect lower parking demand near transit. (See Table 2 in Analysis section.) 2. MULTI -FAMILY ZONES (RM-15, RM-30, RM-40) a. Unit Density. Replace RM-15 zoning designation, which allows 15 units per acre with a RM-20 designation that allows 20 units per acre, to align with Housing Element density allowance. b. Minimum Density. Establish a minimum unit density as provided below. Allow fewer units when determined by the Planning Director, after review by the ARB, that existing site improvements or parcel constraints preclude meeting this minimum standard: • RM-20: 11 units/acre • RM-30: 16 units/acre • RM-40: 21 units/acre c. Non -complying Unit Density. Allow redevelopment and replacement of legally established residential housing units that exceed the maximum unit density allowed for the parcel, subject to the following criteria: i. Other than unit density, the project complies with all applicable development standards. ii. The project is a residential rental project. iii. The development shall not be eligible for a density bonus pursuant to PAMC Chapter 18.15. The applicant must elect whether to utilize state density bonus law or the exception described herein as an alternative to state density bonus law. City of Palo Alto Page 10 d. Administrative Code Clean Up. Modify PAMC Section 18.13.040(g) regarding below market rate (BMR) housing units to reflect regulatory requirements of Chapter 16.65 of Title 16. 3. DOWNTOWN CD -C ZONING DISTRICT a. Unit Density. Eliminate the unit density requirement restricting the maximum density to 40 units per acre. With the proposed amendment, unit density would be controlled by other existing development standards, such as height, floor area, parking requirements, etc. (See Table 3 in Analysis section.) b. Unit Size. Establish a maximum average housing unit size of 1,500 square feet, (weighted average by the number of bedrooms).4 c. Retail Parking. Exempt the first 1,500 sq. ft. of ground -floor retail from parking requirements within residential mixed -use buildings. d. Driveway Approach. Reinforce existing city policy and guidelines to preclude curb cuts on University Avenue, except for City -owned parcels or City -sponsored projects. e. Residential Only Development. Allow housing -only projects to be constructed downtown, except in the ground floor (GF) combining district. Retail preservation ordinance standards apply for market rate housing projects. Note, current zoning standards permit housing only when part of a commercial, mixed - use development or on housing opportunity sites (i.e., in the Housing Element). f. Open Space. Allow rooftops to qualify for up to 75% of the usable open space requirement for the multi -family residential portion of a project, subject to objective performance standards (see draft ordinance for details). g. Housing Incentive Program (HIP). Establish a process that would allow property owners to apply to receive greater floor area than otherwise allowed under the zoning code and under State Density Bonus Law through waivers granted by the Director of Planning after review by the ARB. This program would be an alternative to the State Density Bonus Law and SB 35 streamlining, since it allows for more density. Components of the HIP include the following: i. FAR waiver to increase residential FAR from 1.0 up to 3.0, except for portion of FAR required to remain commercial by the requirements of the retail preservation ordinance or GF combining district. (See Table 4 in Analysis section for detailed standards and discussion of how this FAR value puts residential development potential on par with non-residential development.) ii. No TDRs may be used in conjunction with a qualifying HIP project. 4 For example, a project with ten 800 -square foot 1 -bedroom units, eight 1,200 square -foot 2 -bedroom units, and two 1,800 -square foot 3 -bedroom units would have a weighted (by # of bedrooms/unit size) of 1,060 square feet [((10x800)+(8x1,200)+(2x1,800))/(10+8+2)]. This weighted average more accurately represents the average unit size across all units in a development. City of Palo Alto Page 11 iii. Require discretionary architectural review consistent with PAMC 18.76.020 (Architectural Review) 4. CALIFORNIA AVENUE CC(2) ZONING DISTRICT a. Unit Density. Eliminate the unit density requirement restricting the maximum density, which currently ranges from 30 to 50 dwelling units per acre. With the proposed amendment, unit density would be controlled by other existing development standards, such as height, floor area, parking requirements, etc. (See Table 3 in Analysis section.) b. Residential Only Development. Allow housing only projects to be constructed, except on properties in the retail shopping (R) combining district. Current zoning standards permit housing only when part of a commercial, mixed -use development. c. Retail Parking. Exempt the first 1,500 sq. ft. of ground -floor retail from parking requirements within residential mixed -use buildings to facilitate ground -floor retail. d. Driveway Approach. Reinforce existing City policy and guidelines to preclude curb cuts on California Avenue, except for City -owned parcels or City -sponsored projects. e. Open Space. Allow rooftops to qualify for up to 60% of the usable open space requirement for the multi -family residential portion of a project, subject to objective performance standards. f. Housing Incentive Program (HIP). Establish a process that would allow property owners to apply to receive greater floor area than otherwise allowed under the zoning code through waivers granted by the Director of Planning after review by the ARB. This program would be an alternative to the State Density Bonus Law and SB 35 streamlining, since it allows for more density. Components of the HIP include the following: i. FAR waiver to increase residential FAR from 0.6 up to 2.0, except for that portion of the commercial FAR required to remain commercial by the requirements of the retail preservation ordinance or R combining district. (See Table 4 in Analysis section for detailed standards and discussion of how this FAR value puts residential development potential on par with non-residential development.) ii. Require discretionary architectural review consistent with PAMC 18.76.020 (Architectural Review) 5. PROPERTIES ADJACENT TO EL CAMINO REAL IN THE CN AND CS ZONING DISTRICTS City of Palo Alto Page 12 a. Unit Density. Eliminate the unit density requirement restricting the maximum density, which currently ranges from 30 to 50 dwelling units per acre. With the proposed amendment, unit density would be controlled by other existing development standards, such as height, floor area, parking requirements, etc. (See Table 3 in Analysis section.) b. Open Space. Allow rooftops to qualify for up to 60% of the usable open space requirement for the multi -family residential portion of a project, subject to objective performance standards. c. Retail Parking. Exempt the first 1,500 sq. ft. of ground -floor retail from parking requirements within new residential mixed -use buildings that are subject to the d. Ground Floor Residential Design Standards. Adopt objective design standards to create an attractive active appearance for residential development on the ground -floor, while also maintaining privacy for residents: i. Individual dwelling units shall not be permitted on the ground -floor fronting El Camino Real. Instead, the ground -floor frontage on El Camino Real may include common areas, such as lobbies, stoops, community rooms, and work-out spaces with windows and architectural detail to create visualize interest. Ground floor residential would be permitted beyond the common areas or if set back away from El Camino Real. ii. Parking shall be located behind buildings or below grade, or, where those options are not feasible, screened by landscaping, low walls, or structured garages with architectural detail. e. Housing Incentive Program (HIP). Establish a process that would allow property owners to apply to receive greater floor area than otherwise allowed under the zoning code through waivers granted by the Director of Planning after review by the ARB. This program would be an alternative to the State Density Bonus Law and SB 35 streamlining, since it allows for more density. Components of the HIP include the following (see Table 4 in Analysis section for detailed standards.): i. FAR waiver to increase residential FAR from .5 (CN) and .6 (CS) up to 1.5, except for that portion of FAR required to remain commercial by the requirements of the retail preservation ordinance or other district requirements. (See Table 4 in Analysis section for detailed standards and discussion of how this FAR value puts residential development potential on par with non-residential development.) ii. Waiver to eliminate or reduce the 50% lot coverage requirement and instead rely on site planning, landscape and setback requirements. iii. Require discretionary architectural review consistent with PAMC 18.76.020 (Architectural Review) City of Palo Alto Page 13 PTC Modifications at October 10th Hearing The PTC made the following changes to the ordinance and/or staff recommendation at the October 10th hearing. These changes have been integrated into the draft ordinance herein, except as noted below where Council input is requested: 1. Increase the maximum average unit size Downtown from 1,350 to 1,500 sq. ft. 2. Remove 100% affordable housing projects on El Camino Real from the proposed exemption from the Retail Preservation Ordinance. 3. Through the proposed Housing Incentive Program, allow 100% affordable housing projects to utilize the development standards established in the Affordable Housing Combining District when the project qualifies for federal tax credits. Qualifying projects would be processed through a discretionary review and would not require the legislative approval for a combining district. 4. Disallow in -lieu parking for commercial land uses above the ground floor. Ground -floor commercial could still take advantage of the program. 5. Consider retaining a separate guest parking requirement; discuss with Council (not included in draft ordinance; see discussion in Analysis section). Analysis Floor area, density allowance and parking are three of the greatest drivers influencing unit yield. According to feedback from developer advisors, these standards —in addition to the project review process —affect a property owner's decision to redevelop a property. The proposed amendments do not fundamentally change the buildable envelope of projects in the affected zoning districts. There are no recommended changes to heights, setbacks, and transitional height limits (daylight plane)6. The revisions propose increases to floor area and changes to open space requirements, which may result in bigger buildings, but the development envelope is not proposed to change. Moreover, the proposed FAR thresholds are maximums and not guaranteed to be achieved on every property being redeveloped. Changes in market conditions, state -mandated regulations, or other external factors will also influence housing production in the future. Other factors, many of which are addressed in the proposed amendments, support land use decisions that can spur housing development. Lot 5 This report asks the Council to explore whether increased height for 100% affordable housing projects is appropriate Downtown and around California Avenue. 6 Along El Camino Real, changes are recommended to lot coverage. City of Palo Alto Page 14 consolidation, not addressed in the proposed amendments, is another area that requires further exploration and should be considered in phase 2 of this multi -year housing work plan. State Density Bonus Law and SB 35 (Housing) Streamlining A key consideration of the recommendations is the inter -relatedness between the City's existing and proposed standards; bonuses, waivers and incentives authorized by the State Density Bonus program; and application of State law, notably SB 35, which is described in the text box below. The City's existing density, height, and other development standards represent the "base" or "floor" standards for a project proposed under SB 35 and State Density Bonus Law. Under State Density Bonus Law, an applicant can achieve up to 35% additional density bonus (i.e., increased FAR from 1.0 to 1.35 or 2.0 to 2.7) in exchange for providing affordable housing on site. The provision of 11% of units at Very -Low Income levels or 20% of units at Low Income levels qualify a project for the 35% density bonus. Many residential projects in Palo Alto —which are subject to the City's 15% inclusionary housing ordinance —could automatically qualify for such a bonus. The State Density Bonus Law and the City's density bonus ordinance provide developers an opportunity to seek development incentives or concessions that support the construction of the affordable housing units. The staff proposed Housing Incentive Program (HIP) aims to create a local alternative to the State Density Bonus that allows for more floor area, while also retaining an opportunity for architectural review. Electing to participate in the HIP means that an applicant is not eligible for State Density Bonus law and no additional waivers or incentives. The developer could opt not to apply for the HIP and use the base zoning standards in conjunction with State law, but those standards and incentives yield less floor area and therefore would be a less attractive alternative. City of Palo Alto Page 15 SB 35 Streamlining Effective January 1, 2018, SB 35, the "by right" housing bill, allows residential or residential mixed use projects that meet certain criteria to secure a streamlined review process (90 to 180 days depending on the project size). No CEQA review is required and no discretionary review (e.g., ARB, PTC or Council review) is permitted beyond advisory comments. Projects near transit may take advantage of zero parking requirements. Projects must be at least two- thirds residential, meet certain affordability requirements, and consistent with the City's zoning and other "objective standards." Currently, in Palo Alto, housing projects with 50% or more housing units affordable at low-income levels (up to 80% AMI) may be eligible for SB 35 streamlining. Other criteria apply in order to qualify for a SB 35 project. State Density Bonus Law California's Density Bonus Law gives developers the right to build additional dwelling units and obtain flexibility in local development requirements, in exchange for building affordable or senior housing. State Density Bonus Law may be used in combination with SB35. By right housing development in accordance with SB 35 has occurred in some jurisdictions in the Bay Area. Some of the provisions included in the City's proposed ordinance are intended to introduce objective standards that would apply to by -right housing development, such as clarification of curb cuts on California and University Avenues. As directed by the Council through its adopted Housing Work Plan, staff is concurrently working on other changes to the zoning code. This will introduce more objective standards into the code that can be applied to future housing projects, including SB 35 development. None of the recommendations in this report preclude SB 35 or State Density Bonus development. Analysis of Specific Zoning Changes The balance of this report provides information analyzing the key zoning changes in the proposed ordinance. Parking The parking demand and supply study described in the Background section of this report found that parking supply exceeds demand across each product type studied: market rate, senior, and affordable multifamily housing. This suggests that there are opportunities to reduce parking requirements without creating spillover impacts or an undersupply of available parking. Existing regulations and proposed changes are shown in Table 1. The current code provides an opportunity to reduce parking for affordable housing projects up to 40%. This represents a discretionary request, which complicates application processing for affordable housing providers. The ordinance recommends removing discretion and applying the City's existing standard by right, based on deed restricted household income levels. City of Palo Alto Page 16 Similarly, the zoning code also allows for a 20% parking reduction for housing units located near fixed rail. Staff recommends applying that standard by right, eliminating the controversy that often surrounds requests for parking reductions. In exchange for using this proposed standard, property owners would be required to provide a (Caltrain) transit pass with each dwelling unit or implement a demonstrably equivalent measure. Additionally, the zoning changes include an exemption for the first 1,500 sq. ft. of ground -floor retail from parking requirements. According to the developers and architects interviewed, the provision of parking for the commercial portion of mixed use residential buildings can be a challenge to making a project viable. This exemption would help to relieve physical and financial constraints, and provide an incentive for including retail uses in a project. The 1,500 - square foot number in particular reflects the current trend toward smaller retail spaces. Aligning parking supply and demand sets the right amount of parking based on use and location, and frees up space to be used for additional housing units, community space, or other amenities. However, developers have told staff that the proposed parking standards are still challenging to accommodate new housing development, particularly given the small lots Downtown. At this time, staff is not prepared to make further reductions, based on the available data. Exploring options for small lot consolidation in the future may help address this perceived constraint. Table 1: Existing and Proposed Parking Standards Use/Unit Type Existing Proposed Citywide Within %-Mile of Fixed Rail Station * Micro Unit (<450 sq. ft.) No current standard 1 0.5 Studio 1.25 1 0.8 1 Bedroom 1.5 1 0.8 2+ Bedroom 2 2 1.6 Guest 1+10% of total units included above Senior Housing up to 50% reduction from existing standard 0.75 per unit No additional parking reduction. Affordable Housing Potential reduction by income level: 40% for extremely low 30% for very low 20% for low income Allow existing reductions by right * Projects that qualify for this standard must provide annual transit passes (ie; Go Passes) to each tenant. City of Palo Alto Page 17 Project Review Process/Application Processing Time The public review process provides opportunities for community input and feedback from decision -makers, but also adds time, expense, and uncertainty from the perspective of applicants. Streamlining the review process by maintaining Architectural Review and eliminating Site & Design Review would maintain the following processes, but eliminate the burden placed on projects to undergo review by three separate bodies: 1. Staff review of zoning compliance 2. Public noticing and public comment at ARB hearings 3. Project review of context -based design criteria by the ARB 4. Opportunity for appeal to the City Council Notably, the proposed revision represents the same process that currently exists for most project types in the city, including commercial development, multi -family residential projects in the RM districts, and residential or mixed -use projects with fewer than 10 units. Site & Design Review was originally created to address environmental issues, such as in the Baylands or Foothills and was later applied to review mixed -use projects when that concept was relatively new. This change makes the review of housing projects no more burdensome than the review process for commercial office buildings. Density and Intensity Standards Current density/intensity maximums are one of the major items restricting housing production, according to architects and developers interviewed, and to the quantitative analysis of housing opportunity sites completed for Downtown.' Unit Density Eliminating residential density standards in commercial mixed -use districts would allow more flexibility for developers to increase the overall unit count without affecting the massing or design of a project. (See Table 2.) A density standard would still be retained in the form of FAR. As shown in Figure 1, residential density can be an imperfect metric on which to consider a project's potential impact. FAR values can be more easily illustrated and compared between projects to demonstrate the relationship between total floor area and the site area, and the resulting massing. This change could modestly increase the number of units proposed and the affordability of those units without impacting the massing and bulk of a project. Dyett & Bhatia and EPS. "Downtown Development Evaluation: Residential Capacity and Feasibility Analysis" October 30, 2017. <https://www.cityofpaloalto.org/civicax/filebank/documents/64477> City of Palo Alto Page 18 Figure 1: Residential Density vs. FAR Residential Density Floor Area Ratio (FAR) Hypothetical 1 -Acre Project Senior Housing Student Housing • 50 units • Studios and 1 -bedrooms • 50 bedrooms = 50 units/acre • 10 units • 5 -bedroom suites • 50 bedrooms = 10 units/acre Residential density values vary based on the number of units and do not reflect the unit size or number of bedrooms in each unit. U.i FAR -, r ,� Q � 2 Stories Entire Lot Area Half L< r Arta Quarter Lot Area (So u rce: City of Seattle Land Use Code) Equal FAR values can appear as very different massing and height configurations, but are independent of unit count and bedroom sizes. Existing regulations and proposed changes are shown in Table 2. Table 2: Existing and Proposed Residential Density Standards, by Commercial Zoning District Maximum Residential Density (du/acre) CD -C (Downtown) CC(2) (Cal Ave.) CN District (El Camino) CS District (El Camino) Existing 40 40 (50 w/BMR units) 15 (20 for Housing Element sites) 30 Proposed -- -- -- -- Residential Density in the RM Districts Size Setting reasonable minimum densities on conforming lots ensures that sites will not be underutilized, while not creating a burden on property owners and developers. This change could incrementally increase the number of units proposed and the affordability of those units, without impacting the building envelope already permitted pursuant to current regulations. Increasing the residential density maximum in RM-15 district from 15 to 20 (and renaming the district accordingly) would make the allowed densities in the Housing Element and district regulations consistent and provide an opportunity for some increased density. The proposed zoning change contemplates circumstances where a property owner is not able to meet the City of Palo Alto Page 19 minimum density standards and establishes a review and approval process to permit fewer units if warranted due to site constraints. Commercial Floor Area May be Used for Residential Projects The proposed amendments generally seek to allow residential development to achieve the total FAR that is currently allowed for non-residential projects through the Housing Incentive Program, or HIP, waiver. Existing regulations and proposed changes are shown in Table 3. The examples below describe how sites could build out, based on the draft proposed regulations (also see the site massing models in Attachment B and C): • In the Downtown CD(C) district, a 100% residential project (e.g., on a Housing Element opportunity site) could develop at up to the proposed maximum FAR allowance of 3.0. However, most CD(C) sites also contain the GF overlay and/or would be subject to the Retail Preservation Ordinance requirements. As a result, a residential mixed use project with ground -floor retail is a more likely scneario. For example, a mixed use project could be developed at 0.5 retail FAR and 2.5 residential FAR --not to exceed 3.0. • Similarly, on California Avenue and El Camino Real, 100% residential projects could achieve 2.0 and 1.5 FAR in the CC(2) or CN/CS districts, respectively. However, given district requirements for ground -floor residential, R overlay standards, and Retail Preservation Ordinance requirements, mixed use projects are still often required in these districts. A more likely scenario is for a residential mixed use project to develop with ground -floor retail. For example, a mixed use project could be developed at 0.25 retail FAR and up to 1.75 residential FAR (not to exceed 2.0 total) on California Ave. and 0.15 retail FAR and up to 1.35 residential FAR (not to exceed 1.5 total) on El Camino Real. Allowing residential FAR to compose the entire mixed -use FAR allowance (where retail is not required) would remove some of the disincentive that currently exists for residential development compared with commercial development, due to construction costs, lease rates, and development standards. Ai&LA; ► .,, .411 This specific change would not increase In the CS District, hotels are permitted 2.0 FAR, while the total amount of development residential uses are permitted only 0.6 FAR. This currently allowed by the code, but may discrepancy has provided an incentive for hotel incrementally increase the amount of rlavainnmant in tha rlictrirt future residential development, and potentially decrease new commercial development. City of Palo Alto Page 20 Table 3: Existing and Proposed FAR Standards, by Commercial Zoning District Maximum Intensity (FAR) CD -C (Downtown) CC(2) (Cal Ave.) CN District (El Camino) CS District (El Camino) EXISTING Residential Mixed Use Residential Commercial (Max.) Ground Floor Commercial (Min.) Subtotal Mixed Use Non -Residential Commercial FAR Hotel FAR Bonus and/or TDR Total Maximum FAR 1.0 1.0 n/a (except GF overlay) 2.0 1.0 2.0 1.0 3.0 1.0 0.25-0.35 0.15 or 0.25 (dep. on location) 1.25 2.0 2.0 0.5 2.0 0.5 0.5 0.15 1.0 0.4 2.0 N/A 2.0 (hotel) 1.0 (other) 0.6 0.4 0.15 1.0 0.4 2.0 N/A 2.0 (hotel) 1.0 (other) PROPOSED Residential Mixed Use Residential (Max.) Commercial (Max.) Ground Floor Commercial (Min.) Subtotal Mixed Use Non -Residential Hotel FAR Commercial FAR Bonus and/or TDR Total Maximum FAR 3.0 2.0 1.5 1.5 No Change (see above) n/a (except GF overlay) n/a (except R overlay) 0.0-0.15 (dep. on location) 0.0-0.15 (dep. on location) 3.0 2.0 1.5 1.5 No Change No Change No Change 3.0 2.0 2.0 (hotel) 1.5 (other) 2.0 (hotel) 1.5 (other) In its review of the proposed changes, the City Council may want to consider whether the floor area dedicated to housing projects in the CN and CS districts ought to be consistent with the floor area granted to hotel development as there may be policy reasons to support this change. However, not all properties may be able to achieve the 2.0 floor area maximum due to other development constraints. The PTC supported increasing the FAR by .5 to achieve a 1.5 FAR, but it did not consider an increase to 2.0 during its review. Maximum Average Unit Size The City has seen several large penthouse dwelling units constructed in Downtown in recent years as a result of parking requirements and high rental rates. When a developer has a 12,000 City of Palo Alto Page 21 square foot floor plate, they could choose to develop 12 units at 1,000 square feet. This would require 26 parking spaces or 3 units at 4,000 square feet each that requires only 6 parking spaces. Without the benefit of an in -lieu parking fee, residential parking spaces must be provided on site. Developers say they cannot fit many parking spaces on site without going underground, which is expensive. As a result, the developer builds a few luxury units rather than 12 moderately - sized units. This new standard of a maximum average unit size of 1,500 square feet is intended to eliminate the former option Downtown. Combined with reduced parking requirements (including for micro units), this standard would provide an incentive for small and moderate - sized units in the City's most walkable transit -oriented core. Open Space On -site open space is an important factor in supporting livability in higher density residential areas, but current standards are applied inconsistently across districts and housing types. Standardization can clarify what is expected of developers, while flexibility in the location of open space can provide opportunities to develop sites with the allowable massing and unit density. Using Building Rooftops as Open Space The zoning code requires open space for residential uses in the City's commercial districts. In areas of the city designated for higher density multi -family housing, options to configure the massing and site plan for a project can help maximize the number of appropriate units for a site. Rooftop decks in a climate such as Palo Alto can offer an amenity for residents to take advantage of views and community outdoor space. The ordinance includes a range of standards and guidelines to address issues of privacy, noise, visibility, odors, and safety. Standardized Requirements A single standard for each district —regardless of how many units are on the site —simplifies the code and eliminates any bias for projects that are choosing between proposing five or six units. No changes are proposed to required landscaping areas (i.e., green space) or dimensional requirements. The proposed ordinance also contemplates micro -units with a maximum floor area of 450 square feet. While open space is an important component for any dwelling unit, the 150 square foot approach is excessive for these units; the ordinance instead proposes 40 square feet. Existing regulations and proposed changes are shown in Table 4. City of Palo Alto Page 22 Table 4: Existing and Proposed Open Space Standards, by Commercial Zoning District CD -C (Downtown) CC(2)/PTOD (Cal Ave.) CN District (El Camino) CS District (El Camino) Existing <5 units: 200 sq. ft./du 6+ units: 150 sq. ft./du <5 units: 200 sq. ft./du 6+ units: 100 sq. ft./du or less w/BMR units <5 units: 20 sq. ft./du 6+ units: 150 sq. ft./du <5 units: 20 sq. ft./du 6+ units: 150 sq. ft./du Proposed (Dwelling Units) 150 sq. ft./du 150 sq. ft./du 150 sq. ft./du 150 sq. ft./du Proposed (Micro Units) 40 sq. ft./du 40 sq. ft./du 40 sq. ft./du 40 sq. ft./du Retail Incentives and Preservation The Retail Preservation Ordinance has the benefit of preventing the conversion of retail uses and precluding office uses from occupying these spaces. However, the ordinance may also frustrate City efforts to enhance housing production by retaining retail in areas that do not have a strong retail environment and where a housing provider is unable or unwilling to include new retail floor area in their project due to financing, constructions costs (more required parking) or other market considerations. 801 Alma was originally conceived to include ground floor retail. However, the financing and logistics proved too complicated; ultimately, a 100% residential oroiect was approved and constructed. Staff recommends a narrow exemption to the Retail Preservation Ordinance for 100% affordable housing developments on sites outside of the GF and R overlays in Downtown and California Avenue, respectively. This change seeks to balance the tradeoff between housing production and retail preservation. The PTC recommended retaining El Camino Real as a location where the Retail Preservation Ordinance for affordable housing developments would continue to apply and this change is reflected in the ordinance. Ground Floor Retail Parking Reduction To support continued retention of ground floor retail uses while recognizing the challenges developers have making a mixed -use housing project viable, staff recommends exempting the first 1,500 square feet of a retail or retail -like use within a residential mixed -use development from vehicle parking requirements. This change would reduce a retail use's requirement by City of Palo Alto Page 23 approximately 8 parking spaces and a restaurant use's requirement by 18 spaces (6 spaces within the parking district). In Lieu Parking Non-residential uses have the option of paying into the Parking In -Lieu Fund in -lieu of providing parking on site (at a rate of $70,094/space), subject to certain findings. Given the high cost of land and the value of office lease rates, developers often choose to pay this fee and maximize their leasable area. Residential uses do not have this option; moreover, they likely cannot afford the per space rate, as it is currently set. At one point over the course of the Commission's discussion of possible zoning code changes, staff presented the concept of allowing residential properties to participate at a subsidized rate in the in -lieu parking program. This was not supported by a majority of the Commission and there was some discussion about the program as it relates to commercial development. When testing some of the zoning ordinance concepts with developers, it became clear to staff that the in -lieu parking program did create a significant incentive that supported commercial development over housing. This presented a challenge that touched on varied community interests to promote housing while also allowing for moderate commercial growth against the backdrop of parking complaints downtown and related traffic congestion. Staff explored these issues with the Commission, which ultimately supported a motion to restrict commercial uses from participating in the in -lieu parking program above the first floor. The PTC minority view on this motion expressed opposition to this action, noting the lack of outreach to the business community and property owners, and that this fell outside of the Commission's scope or review for the Council -directed housing workplan. Staff acknowledges that there is no reference to the in -lieu parking program in the housing workplan, but also notes the significance of this program as it relates to choices property owners make on how to redevelop property. While modification of this program may not be ripe for action at this time, staff supports a future community conversation that engages downtown property owners and businesses to explore whether modification to the program is warranted. Since the ordinance reflects the Commission's recommendation, changes to the in -lieu parking program have been incorporated into Attachment A. If Council supports the Commission recommendation, no change is needed. If Council does not support action at this time, a motion can be made to strike Sections 8 from the attached ordinance (related to changes in to PAMC section 18.18.090(d). This would effectively retain the existing in -lieu parking program unchanged. Remove Legislative Requirement for the Affordable Housing Overlay City of Palo Alto Page 24 The PTC motion included a request to eliminate the legislative requirement for 100% affordable housing projects seeking to take advantage of the recently adopted Affordable Housing Combining District. The PTC would apply this to housing projects that qualify for federal income tax credits and not affordable housing projects up to 120% of the area median income, which is the current provision in the combining district. Staff supports this request and has included as a waiver that could be requested through the proposed Housing Incentive Program. The Affordable Housing Combining District still has applicability in other parts of the city not affected by the proposed ordinance. Additional Considerations Consider Reinstating Guest Parking — PTC Request As noted in the draft ordinance and parking discussion above, the revised parking standards are inclusive of guest parking. This change is based on findings from the empirical parking study and related literature review. The PTC recommended that the Council consider reinstating a requirement for guest parking stalls. The City's current guest parking requirement is 1 space, plus 10% of the required parking spaces for the residential development. Staff does not support this PTC recommendation as parking is a key driver in decisions to not only establish housing but also the size of the units and unit density. To achieve more housing, the zoning standards need to more accurately reflect the relationship between demand and supply, which is lower than what the current ordinance requires. Increase Affordable Housing Density and Height Downtown — PTC — No Consensus The PTC also discussed but did not make a motion to support additional incentives for 100% affordable housing development in high -amenity transit -oriented locations (i.e., Downtown and California Avenue). Staff explored a concept to increase FAR and allow an additional 10 -feet in height to allow for an additional floor of residential. This included the following: • In Downtown, allow 100% affordable housing projects at a specified area median income (AMI) percentage to achieve a 4.0 FAR and 10 additional feet in height (up to 60 feet) when located within .5 miles of the Caltrain station. • Around California Avenue, allow 100% affordable housing projects at a specified AMI percentage to achieve a 2.5 FAR (whereas 1.5 FAR is allowed for BMR today) and extend to 50 feet in height when located within .5 miles of the Caltrain station. The current pedestrian and transit overlay district (PTOD) standard allows up to 50 feet in height when applied to below -market rate projects within the PTOD boundary. The PTC, while conceptually interested in additional incentives, requested massing models to better understand how increases in height and FAR would fit in with the downtown. The PTC City of Palo Alto Page 25 also requested that massing models be presented to the Council that showed what construction would look like with the proposed standards on El Camino Real and near California Avenue. Staff was able to have these illustrations prepared for Downtown and El Camino Real at the time this report was prepared; see Attachment B and C. These massing models are illustrative and accurate relative to existing and proposed development standards. If the Council is not interested in pursuing these additional incentives at this time, no further action is required. If, however, the Council would like to introduce these standards, then incorporating this direction in a motion supporting the attached ordinance would be necessary. Staff would adjust the ordinance and the language would be provided to Council on the second reading of the ordinance. Policy Implications Relationship to Housing Work Plan/Council Referral Table 5 analyzes how each of the ordinance provisions fits into the Housing Work Plan. Table 5: Relationship between Work Plan Items and Proposed Ordinance Work Plan Items Key Ordinance Provisions 2.1 Identify By Right Project Procedures (SB 35) Ongoing — not included in this ordinance 2.2 Strengthen objective standards Ongoing — not included in this ordinance 2.3 Comp Plan and SOFA plan changes to strengthen objective standards Ongoing — not included in this ordinance. 2.4 Provide incentives and remove constraints for multifamily housing in the Downtown (CD -C), Cal Ave (CC(2)/PTOC), and El Camino Real (CN and CS) districts, including: 2.4.1 Review and revise development standards (e.g. landscaping, open space) • Allow rooftop gardens to qualify as usable open space • Simplify open space standards • Eliminate the 50% lot coverage requirement on El Camino Real 2.4.2. Consider eliminating dwelling unit densities and relying on FAR and average unit sizes • Eliminate residential density standards in the CD -C, CC(2), and CN, CS districts • Establish a maximum average unit size Downtown 2.4.3 Review and revise permitted uses • Provide exemptions from the Retail City of Palo Alto Page 26 Work Plan Items Key Ordinance Provisions and use mix (e.g. allow 100% residential w/ground floor retail) Preservation Ordinance for 100% affordable projects • Allow 100% residential projects in the CD, CC2, and on El Camino Real in the CN and CS districts, except in all cases, where precluded by ground floor retail protections. 2.4.4 Review and revise level of permitting and plan review required • • Eliminate Site & Design Review Provide Housing Incentive Program as an alternative to State Density Bonus Law 2.4.5 Allow parking reductions based on TDM plans and on payment of parking in lieu fees for housing (Downtown and Cal Ave). Update the TDM Ordinance to the extent that it does not already include metrics of measurements, accomplishments, and enforcement, include these metrics.' • The Office of Transportation is currently updating guidelines for administering, monitoring and enforcing TDM programs (not part of draft ordinance) 2.4.6 Convert some non-residential FAR to residential FAR • Allow residential development to utilize all existing FAR allowance, except where precluded by ground floor retail requirements. 2.4.7 Remove constraints to special needs housing' • Special needs housing is a defined term in the housing element and more work is needed to address certain housing populations. However, the ordinance includes the following provisions that may address other housing needs: o Removes the legislative requirement to establish the Affordable Housing Combining District, adjusting the % AMI levels to match federal tax credit standards o Creates an incentive for micro units near fixed rail transit. o Reduces by -right parking standards for affordable and senior housing 2.4.8 Increase Floor Area Ratio (FAR) in • FAR increases through the Housing City of Palo Alto Page 27 Work Plan Items Key Ordinance Provisions the Downtown, California Avenue, and El Camino Real areas Incentive Program 2.5 Support multifamily housing in the multifamily (RM) zoning districts by: i. Consider establishment of minimum densities in all RM zones ii. Allow redevelopment (replacement) of existing residential units on sites that are nonconforming because of the number of units or FAR • Minimum residential density standards proposed in the RM districts • Opportunity to rebuild legally established housing units that presently exceed permitted density allowances. 2.6 Provide incentives and remove constraints in all zoning districts, including: 2.6.1 Adjustment to parking requirements to reduce costs (based on an ongoing study of parking demand by housing type and location); identify the appropriate amount of parking for various housing types and locations, taking into account parking mitigations • Adjust parking requirements based on parking demand/supply analysis • Exempt 1,500 s.f. of ground floor retail from parking requirements 1 A provision to allow residential uses to pay a fee in lieu of providing parking on site in Downtown and around California Avenue was considered and rejected by the PTC. Instead, the PTC action supported eliminated the in -lieu parking payment Downtown for commercial uses above the ground floor. 2 Staff were not able to develop a strategy for teacher housing opportunities within Fair Housing Laws, but has considered possible changes to the Workforce Housing Overlay to support a possible housing project on Santa Clara County owned land near the courthouse. The PTC considered and rejected fee waivers for special needs housing. Source: Palo Alto Planning & Community Environment, November 2018 Resource Impact Most of the recommendations in this report do not have significant budget or fiscal impacts. If the in -lieu parking program is modified to preclude commercial development from participating in the program above the ground floor, the City would likely see a reduction in in -lieu parking fees over time. Timeline A timeline for development of the ordinance is provided in Table 6. Table 6: Project Timeline Meeting Type Topic Date City of Palo Alto Page 28 Meeting Type Topic Date PTC Study Session Review objectives for housing work plan and city council direction March 14 PTC Study Session Overview of issues, including key findings from an analysis of residential capacity in Downtown April 25 PTC Study Session Parking, including key findings from an analysis of residential parking demand May 30 Community Meeting Present and receive feedback on ordinance framework ideas June 28 PTC Study Session Framework for ordinance August 29 ARB Hearing Review of rooftop open space design standards September 20 PTC Hearing Revised framework for ordinance September 26 PTC Hearing Recommendation on Draft Ordinance October 10 City Council Hearing Draft Ordinance (First Reading) November 26 Environmental Review The City Council certified a Final EIR (http://www.paloaltocompplan.org/wp- content/uploads/2017/08/PaloAltoCompPlanFEIR Aug2017.pdf) on November 13, 2017 to analyze potential impacts associated with the updated Comprehensive Plan. The 2018 Comprehensive Plan Implementation and Housing Ordinance is consistent with the Comprehensive Plan and its Final EIR. At this time, no substantially greater or more severe impacts are anticipated and no development is proposed, beyond what is allowed by the Comprehensive Plan. Report Author & Contact Information Jean Eisberg, Consultant Planner (415) 841-3539 jean@lexingtonplanning.com Attachments: PTC8 Liaison & Contact Information Jonathan Lait, AICP, Interim Director (650) 329-2679 Jonathan.lait@cityofpaloalto.org Attachment A: 2018111402 ORD Draft 2018 Housing Work Plan Ordinance for CC v 11-13-18 (PDF) Attachment B: CD -C Downtown Massing Model_11-09-18 (PDF) Attachment C: CN ECR Massing Model_11-09-18 (PDF) 8 Emails may be sent directly to the PTC using the following address: planning.commission@cityofpaloalto.org City of Palo Alto Page 29 Attachment A Not Yet Approved Ordinance No. Ordinance of the Council of the City of Palo Alto Amending Title 18 (Zoning) of the Palo Alto Municipal Code, Including Chapters 18.04 (Definitions), 18.13 (Multiple Family Residential RM-15, RM-30 and RM-40) Districts), 18.16 (Neighborhood, Community, and Service Commercial (CN, CC, and CS) Districts), 18.18 (Downtown Commercial (CD) District), 18.40 (General Standards and Exceptions), and 18.52 (Parking and Loading Requirements), to Establish or Modify Development Standards for Residential and Mixed -Use Projects Including, But Not Limited to, Minimum and Maximum Unit Density, Unit Size, Floor Area Ratio, Height, and Open Space Including Rooftop Gardens, to Modify Parking Requirements and Adjustments, to Limit In -Lieu Parking for Downtown Commercial Uses Above the Ground Floor, to Allow Exclusively Residential Projects in Certain Commercial Zoning Districts, to Exempt Certain Affordable Housing Projects from Retail Preservation, to Simplify the Entitlement Process Removing Site and Design Review for Residential and Mixed -Use Projects, and to Make Other Technical Corrections and Clarifications, All to Promote Housing Development Opportunities in the Multi -Family Residential Zoning Districts and Commercial Zoning Districts in Furtherance of Implementation of the Comprehensive Plan The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. Findings and Declarations. The City Council finds and declares as follows: A. California is in the midst of a housing crisis due to a severe shortage of housing that is affordable to large segments of the population, including above -moderate and moderate income households and, most acutely, lower -income households. According to the California Department of Housing and Community Development (HCD), throughout the State, housing production averaged less than 80,000 new homes over the last 10 years, and ongoing production continues to fall far below the projected need of 180,000 additional homes annually. The lack of supply, with a deficit that deepens each year, has been a key driver of the lack of affordability for millions of households throughout the State. The majority of Californian renters pay more than 30 percent of their income toward rent, and nearly one-third pay more than 50 percent of their income toward rent. B. In the nine -county Bay Area, which contains job centers that have produced a substantial number of new jobs, the lack of housing affordability is even more severe. The Bay Area continues to produce housing units in insufficient numbers to adequately house both existing and projected populations. Between 2011 and 2015, the Bay Area added 500,000 jobs but built only 65,000 new homes. Limited housing, with increasing demand and constraints on 1 2018111402 Not Yet Approved production, have resulted in high housing cost burdens that fall most heavily on lower income households who are more likely to be renters. Between 2000 and 2016, rents increased 24 percent while renter incomes rose just 9 percent. Six of every 10 economically insecure residents are renters and 75 percent of them pay more than 30 percent of their income for housing. C. For Palo Alto, as a job center with among the highest housing prices and greatest jobs to housing imbalances in the Bay Area, the housing shortage threatens the city's prosperity, diversity, stability, environment, quality of life, and community character. D. The cost pressures associated with substantially increased housing prices and rents have resulted in displacement and contributed to homelessness, separated families, and loss of diversity. Residents in search of affordability are driven to move to far outlying areas, requiring longer commutes to job centers in the Bay Area, including Palo Alto. According to a recent report by the Bay Area Economic Council, more than 100,000 Bay Area mega -commuters travel 90 minutes or more to reach their jobs, contributing to a 78 percent increase since 1990 in the number of mega -commuters crossing county and regional boundaries to get to work. Of the nearly 200,000 commuters crossing regional boundaries in 2013, 69 percent were commuting into the Bay Area for work. This results in health and quality of life impacts to individuals, as well as community -wide and region -wide impacts in terms of increased traffic congestion, air pollution and greenhouse gas emissions. Without the construction of more housing near urban centers and jobs, the State's ability to achieve its climate change goals is in jeopardy. E. In November 2017, the City adopted an updated Comprehensive Plan that projected 3,545 to 4,420 new housing units between 2015 and 2030, and included policies to encourage housing production. The Council subsequently approved a Housing Work Plan with a recognition that if Palo Alto remains on its current course, the City will fall short of meeting its Regional Housing Needs Assessment (RHNA) allocation of 1,988 units at varying levels of affordability and the goals inherent in the Comprehensive Plan policies. The Housing Work Plan detailed the actions needed to spur the production of housing, and included the proposed zoning changes reflected in this Ordinance to remove barriers and disincentives to housing development at higher densities where appropriate near transit, jobs and services, and that is affordable for a range of income levels. 2 2018111402 Not Yet Approved SECTION 2. Subsection (a)(142) of Section 18.04.030 of Chapter 18.04 (Definitions) of Title 18 (Zoning) of the Palo Alto Municipal Code (PAMC) is amended to read as follows: 18.04.030 Definitions (142) "Usable open space" means outdoor or unenclosed area on the ground, or on a roof, balcony, deck, porch, patio or terrace, designed and accessible for outdoor living, recreation, pedestrian access, or landscaping, but excluding parking facilities, driveways, utility or service areas, or areas with mechanical equipment. Usable open space may be covered if at least 50% open on the sides. Usable open space shall be sited and designed to accommodate all groups including children, seniors, and other adults, different activities, groups, including active and passive recreation and uses, and should be located convenient to the intended users (e.g., residents, employees, or public). Any usable open space that is not landscaped shall be developed to encourage outdoor recreational use and shall include elements such as decks, seating, decorative paved areas and walkways which do not serve as an entrance walkway. Usable open space shall be screened from utility or service areas, and areas with mechanical equipment. Parking, driveways and required parking lot landscaping shall not be counted as usable open space. SECTION 3. The title of Chapter 18.13 of Title 18 (Zoning) of the PAMC is amended to read as follows: Chapter 18.13 MULTIPLE -FAMILY RESIDENTIAL (RM-2015, RM-30 AND RM-40) DISTRICTS SECTION 4. Section 18.13.010 (Purposes) and Section 18.13.040 (Development Standards) of Chapter 18.13 (Multiple Family Residential RM-15, RM-30 and RM-40) Districts) of Title 18 (Zoning) of the PAMC are amended as follows: 18.13.010 Purposes This section specifies regulations for three multiple family residential districts. (a) RM-2015 Low Density Multiple -Family Residence District [RM-2015] The RM-204 low -density multiple -family residence district is intended to create, preserve and enhance areas for a mixture of single-family and multiple -family housing which is compatible with lower density and residential districts nearby, including single- family residence districts. The RM-2015 residence district also serves as a transition to moderate density multiple -family districts or districts with nonresidential uses. Permitted densities in the RM-2015 residence district range from eight to fifteen twenty dwelling units per acre, with no required minimum density. 3 2018111402 Commented [LS1]: These amendments clarify the generally applicable attributes of "usable open space," consistent with the purpose and requirements included in the discussion of rooftop usable open space. 3.f, 4.e, 5.b Commented [LS2]: The amendments to this Section, together with those to Table 2 of Section 18.13.040 that immediately follows, would establish a minimum density for each of the multi- family residential subdistricts and increase the maximum density in RM-15 (re -named RM-20) from 15 to 20 dwelling units/acre. The latter change and the proposed 8 units/acre minimum for RM-15 are a Housing Element program. 2.a, 2.b Not Yet Approved (b) RM-30 Medium Density Multiple -Family Residence District [RM-30] The RM-30 medium density multiple -family residence district is intended to create, preserve and enhance neighborhoods for multiple -family housing with site development standards and visual characteristics intended to mitigate impacts on nearby lower density residential districts. Projects at this density are intended for larger parcels that will enable developments to provide their own parking spaces and to meet their open space needs in the form of garden apartments or cluster developments. Permitted densities in the RM-30 residence district range from sixteen to thirty dwelling units per acre, with no required minimum density. (c) RM-40 High Density Multiple -Family Residence District [RM-40] The RM-40 high density multiple -family residence district is intended to create, preserve and enhance locations for apartment living at the highest density deemed appropriate for Palo Alto. The most suitable locations for this district are in the downtown area, in select sites in the California Avenue area and along major transportation corridors which are close to mass transportation facilities and major employment and service centers. Permitted densities in the RM-40 residence district range from thirty-one to forty dwelling units per acre, with no required minimum density. Section 18.13.040 Development Standards (a) Site Specifications, Building Size and Bulk, and Residential Density The site development regulations in Table 2 shall apply in the multiple -family residence districts, provided that more restrictive regulations may be recommended by the Architectural Review Board and approved by the Director of Planning and Community Environment, pursuant to the regulations set forth in Chapter 18.76, performance criteria set forth in Chapter 18.23, and the context -based design criteria set forth in Section 18.13.060. Table 2 Multiple Family Residential Development Table RM-2013 RM-30 RM-40 Subject to regulations in: Minimum Site Specifications Site Area (ft2) 8,500 Site Width (ft) 70 Site Depth (ft) 100 4 2018111402 Not Yet Approved RM-203-5 RM-30 RM-40 Subject to regulations in: Substandard Lot Specifications Site Area (ft2) Less than 8,500 square feet and/or less than 70 feet in width Site Width (ft) Minimum Setbacks Setback lines imposed by a special setback map pursuant to Chapter 20.08 of this code may apply Front Yard (ft) 20 20 0-25 (1) 18.13.040(b) On arterial roadways1�1 0-20 (1) 0-20 (1) 0-25 (1) Interior Side Yards (ft) For lots with width of 70 feet or greater 10 10 10 For lots with width of less than 70 feet 6 feet Interior Rear Yards (ft)3 10 10 10 Street Side and Street Rear Yards (ft) 16 16 0-161 Comrr reflect Maximum Height (ft) 30 35 40 Maximum height for those portions of a site within 50 feet of a more restrictive residential district or a site containing a residential use in a nonresidential district 35 Daylight Planes(7) • Daylight Plane for side and rear lot lines for sites abutting any R-1, R-2, RMD, or RM-205 district or abutting a site containing a single- family or two-family residential use in a nonresidential district: Initial Height (ft) 10 Angle (degrees) 45 • Daylight Plane for side and rear lot lines for sites abutting a RM-30, RM-40, Planned Community, or nonresidential district that does 5 2018111402 ented [ LS3] : This reflects the existing code, but is not d in the web version and requires an update. Not Yet Approved RM-203-5 RM-30 RM-40 Subject to regulations in: not contain a single-family or two-family residential use: For lots with width of 70 feet or greater None For lots with width of less than 70 feet, limited to the first 10 feet from the property line (no daylight plane beyond 10 feet): Initial Height (ft) 10 Angle (degrees) 45 Maximum Site Coverage: Base 35% 40% 45% Additional area permitted to be covered by covered patios or overhangs otherwise in compliance with all applicable laws 5% 5% 5% Maximum Floor Area Ratio (FAR)(4) 0.5:1 0.6:1 1.0:1 Maximum Residential Density (units) Maximum number of units per acre(3) 2035 30 40 18.13.040(g) Minimum Residenti„t Density (unit) Minimum number of units per acre(8) 11 16 21 Minimum Site Open Space(5) (percent) 35 30 20 18.13.040(e) Minimum Usable Open Space (sf per unit)]5) 150280 150 150380 Comrr chang stands multi -f Minimum common open space (sf per unit) 751-00 75 755-0 18.13.04 Minimum private open space (sf per unit) 50 50 50 Performance Criteria See provisions of Chapter 18.23 Ch. 18.23 Landscape Requirements 18.40.130 Parking(6) See provisions of Chapter 18.52 Ch. 18.52 (1) Minimum front setbacks shall be determined by the Architectural Review Board upon review pursuant to criteria set forth in Chapter 18.76 and the context -based criteria outlined 6 2018111402 ented [LS4]: This amendment, together with the same to other Chapters, would establish a consistent open space ds for multi -family and residential mixed -use projects in mily residential and commercial zoning districts. 1.a Not Yet Approved in Section 18.13.060. Arterial roadways do not include residential arterials. (2) Minimum street side setbacks in the RM-40 zone may be from 0 to 16 feet and shall be determined by the Architectural Review Board upon review pursuant to criteria set forth in Chapter 18.76 and the context -based criteria outlined in Section 18.13.060. (3) Provided that, for any lot of 5,000 square feet or greater, two units are allowed, subject to compliance with all other development regulations. (4) Covered parking is not included as floor area in multi -family development, up to a maximum of 230 square feet per required parking space that is covered. Covered parking spaces in excess of required parking spaces count as floor area. (5) Subject to the limitations of Section 18.13.040(e). Usable open space is included as part of the minimum site open space; required usable open space in excess of the minimum required for common and private open space may be used as either common or private usable open space; landscaping may count towards total site open space after usable open space requirements are met. (6) Tandem parking is allowed for any unit requiring two parking spaces, provided that both spaces in tandem are intended for use by the same residential unit. For projects with more than four (4) units, not more than 25% of the required parking spaces shall be in a tandem configuration. (7) Each daylight plane applies specifically and separately to each property line according to the adjacent use. (8) The minimum density for a site may be reduced by the Director if, after the proposal is reviewed by the Architectural Review Board, the Director finds that existing site improvements or other parcel constraints, preclude the development from meeting the minimum density. (b) Setbacks, Daylight Planes and Height - Additional Requirements and Exceptions (1) Setbacks (A) Setbacks for lot lines adjacent to an arterial street, expressway or freeway, as designated in the Palo Alto Comprehensive Plan, shall be a minimum of twenty-five feet (25'), except that lesser setbacks may be allowed or required by the Planning Director, upon recommendation by the Architectural Review Board, where prescribed by the context -based criteria outlined in Section 18.13.060. Special setbacks of greater than 25 feet may not be reduced except upon approval of a design enhancement exception or variance. 7 2018111402 Not Yet Approved (B) Required parking spaces shall not be located in a required front yard, nor in the first ten feet (10') adjoining the street property line of a required street side yard. (C) Projections into yards are permitted only to the extent allowed by Section 18.40.070 of this code. (2) Height and Daylight Planes (A) Exceptions to maximum height limitations are permitted only to the extent allowed by Section 18.40.090 of this code. (B) The following features may extend beyond the daylight plane established by the applicable district, provided that such features do not exceed the height limit for the district unless permitted to by Section 18.40.090 of this code: i. Television and radio antennas; ii. Chimneys and flues that do not exceed 5 feet in width, provided that chimneys do not extend past the required daylight plane a distance exceeding the minimum allowed pursuant to Chapter 16.04 of this code. iii. Cornices and eaves, excluding flat or continuous walls or enclosures of usable interior space, provided such features do not extend past the daylight plane more than 4 feet, and so long as they do not encroach into the side setback greater than 2 feet. (e) Usable Open Space The following usable open space regulations shall apply: (1) Required Minimum Site Open Space. Each site shall, at a minimum, have a portion of the site, as prescribed in Table 2, developed into permanently maintained open space_ Site open space includes all usable open space plus landscape or other uncovered areas not used for driveways, parking, or walkways. (2) Usable Open Space (Private and Common). Each project shall, at a minimum, have a portion of the site, as prescribed in Table 2, developed into permanently maintained usable open space, including private and common usable open space areas. Usable open space shall be located protected from the activities of commercial areas and adjacent public streets and shall provide noise buffering from surrounding uses 8 2018111402 Not Yet Approved where feasible. Parking, driveways and required parking lot landscaping shall not be counted as usable open space. (A) Private Usable Open Space. Each dwelling unit shall have at least one private usable open space area contiguous to the unit that allows the occupants of the unit the personal use of the outdoor space. The minimum size of such areas shall be as follows: (i) Balconies (above ground level): 50 square feet, the least dimension of which shall is 6 feet. (ii) Patios or yards in the RM-2013 and RM-30 districts: 100 square feet, the least dimension of which is 8 feet for at least 75% of the area. (iii) Patios or yards in the RM-40 district: 80 square feet, the least dimension of which is 6 feet for at least 75% of the area. (B) Common Usable Open Space. The minimum designated common open space area on the site shall be 10 feet wide and each such designated area shall comprise a minimum of 200 square feet. In the RM-30 and RM-40 districts, part or all of the required private usable open space areas may be added to the required common usable open space in a development, for purposes of improved design, privacy, protection and increased play area for children, upon a recommendation of the Architectural Review Board and approval of the Director. (f) Personal Services, Retail Services, and Eating and Drinking Services in the RM-30 and RM-40 Districts Within a single residential development containing not less than 40 dwelling units, personal services, retail services, and eating and drinking services solely of a neighborhood -serving nature to residents in the development or in the general vicinity of the project may be allowed upon approval of a conditional use permit, subject to the following limitations and to such additional conditions as may be established by the conditional use permit: (1) Total gross floor area of all such uses shall not exceed 5,000 square feet or three percent of the gross residential floor area within the development, whichever is smaller, and may not occupy any level other than the ground level or below grade levels. (2) A maximum of 2,500 square feet of retail and/or service and/or eating and drinking uses shall be allowed per establishment. 9 2018111402 Commented [LS5]: This was added to the usable open space definition. Not Yet Approved (3) Personal services, retail services, and eating and drinking services provided in accordance with this section shall not be included in the gross floor area for the site. (4) The conditional use permit for the project may preclude certain uses and shall include conditions that are appropriate to limit impacts of noise, lighting, odors, parking and trash disposal from the operation of the commercial establishment. The hours of operation shall be limited to assure compatibility with the residential use and surrounding residential uses. (5) Allowable Neighborhood -Serving Uses. A neighborhood -serving use primarily serves individual consumers and households, not businesses, is generally pedestrian oriented in design, and does not generate noise, fumes or truck traffic greater than that typically expected for uses with a local customer base. A neighborhood -serving use is also one to which a significant number of local customers and clients can walk, bicycle or travel short distances, rather than relying primarily on automobile access or the provider of the goods or services traveling off -site. Allowable neighborhood -serving personal services, retail services and eating and drinking services may include, but are not limited to, "agent" dry cleaners, flower shops, convenience grocery stores (excluding liquor stores), delicatessens, cafes, fitness facilities, day care facilities, and similar uses found by the Planning Director to be compatible with the intent of this provision. (6) Sign programs, including size, number, color, placement, etc. shall be permitted only as specified in the conditional use permit and by the Planning Director upon recommendation of the Architectural Review Board (7) Off-street parking and bicycle facilities, in addition to facilities required for residential uses, shall be provided as may be specified by the conditional use permit. However, there shall not be less than one parking space for each employee working or expected to be working at the same time. (8) For any project, other than a 100% affordable housing project, containing forty (40) or greater units and located more than 500 feet from neighborhood commercial services, as determined by the Director, a minimum of 1,500 square feet of neighborhood serving retail, personal service, and/or eating or drinking uses shall be provided, subject to the above limitations. No conditional use permit is required, but the commercial use shall be reviewed by the Architectural Review Board as part of the architectural review approval. A minimum of one parking space for each employee working or expected to be working at the same time shall be provided. A "100% affordable housing project" as used herein means a multiple -family housing project consisting entirely of affordable units, as defined in Section 16.65.020 of 10 2018111402 Commented [LS6]: These revisions would exempt 100% affordable housing projects from the retail requirement in the RM district. Not Yet Approved this code, available only to households with income levels at or below 120% of the area median income for Santa Clara County, as defined in Chapter 16.65, except for a building manager's unit. (g) Below Market Rate Units and Rental Housing Protection {1) In developments of five or morc units on sites of less than five acres, not lers than fifteen percent (15%) of the units shall be provided at below market rates (BMR) to very low, low and moderate income households in accordance with Program H 36 of the Palo Alto Comprehensive Plan Housing Element. In developments of five or more units on sites of five acres or morc, not less than twenty percent (20%) of thc units shall be provided at below market rates (BMR). Specified percentages arc applied to all proposed units in a project, including those designated as BMR units. {2) Further details of thc BMR program requirements, including their applicability to subdivisions and for density bonus purposes, arc found in the discussion of Programs H 36 and H 38 of the Palo Alto Comprehensive Plan Housing Element. {3) Below market rate units shall be fully integrated into the development unless good cause is shown for an exception. (g) Redevelopment of Sites with Non -complying Density For a parcel with a residential use that exceeds the maximum unit density of the applicable zoning district, the Director may grant an exception to the maximum unit density standard and allow the parcel to be redeveloped to replace the legally established residential units at the existing density, subject to all of the following: (1) The applicant must make the request for exception under this provision at the time of project application; (2) The project is a residential rental project; (3) The project complies with all other applicable development standards; and (4) The project shall not be eligible for a density bonus under Chapter 18.15 (Density Bonus). The applicant must elect whether to utilize state density bonus law or the exception described herein as an alternative to state density bonus law. (h) Performance Criteria 11 2018111402 Com m ented [ LS7] : This deletion is an administrative clean-up, as the BMR program is now addressed in Chapter 16.65 of the code. 2.d Commented [ LS8] : This new subsection would authorize the Director to grant a zoning exception to allow residentially used sites in the multi -family zoning district that exceed the density standard to be redeveloped as a residential rental project with the same number of units. This option would be an alternative to state density bonus law. 2.c Not Yet Approved In addition to all other provisions of this chapter, all multi -family development shall comply with applicable provisions of Chapter 18.23 (Performance Criteria for Multiple Family, Commercial, Industrial and Planned Community Districts). SECTION 5. The Residential Uses portion of Table 1 of subsection (a) of Section 18.16.040 (Land Uses) of Chapter 18.16 (Neighborhood, Community, and Service Commercial (CN, CC, and CS) Districts) of Title 18 (Zoning) of the PAMC is amended as follows: Section 18.16.040 Land Uses The uses of land allowed by this Chapter in each commercial zoning district are identified in the following tables. Land uses that are not listed on the tables are not allowed, except where otherwise noted. Where the last column on the following tables ("Subject to Regulations in") includes a section number, specific regulations in the referenced section also apply to the use; however, provisions in other sections may apply as well. (a) Commercial Zones and Land Uses Permitted and conditionally permitted land uses for each commercial zone are shown in Table 1: TABLE 1 CD -PERMITTED AND CONDITIONALLY PERMITTED USES P = Permitted Use CUP = Conditional Use Permit Required LAND USE CN(4) CC, CC(2) CS(4) Subject to Regulations In: RESIDENTIAL USES Multiple -Family p(1) P(1) P(1) 18.16.060(b) and (c) Home Occupations P P P Residential Care Homes P P P (1) Residential is only permitted: (i) as part of a mixed use development, pursuant to the provisions of Section 18.16.060(b), or (ii) on sites designated as Homing Opportunity Site5housing inventory sites in the Housing Element of the Comprehensive Plan, (iii) on CN or CS sites on El Camino Real, or (iv) on CC(2) sites outside of the retail shopping (R) combining district, all pursuant to the provisions of Section 18.16.060(b) and (c). 12 2018111402 Commented [ LS9] : These amendments, together with other changes to the commercial zoning chapter 18.16, would allow residential only development in certain parts of the commercial zoning district, specifically in the CC(2) subdistrict and on CN or CS sites on El Camino Real. 4.b; 5.d Not Yet Approved SECTION 6. Subsections (b) and (c) of Section 18.16.060 (Development Standards) of Chapter 18.16 (Neighborhood, Community, and Service Commercial (CN, CC, and CS) Districts) of Title 18 (Zoning) of the PAMC are amended as follows: Section 18.16.060 Development Standards (b) Mixed Uses and Residential Table 4 specifies the development standards for new residential mixed use developments and residential developments. These developments shall be designed and constructed in compliance with the following requirements and the context -based design criteria outlined in Section 18.16.090, provided that more restrictive regulations may be recommended by the architectural review board and approved by the director of planning and community environment, pursuant to Section 18.76.020. Table 4 Mixed Use and Residential Development Standards CN CC CC(2) CS Subject to regulations in: Minimum Site Specifications Site Area (ft2) None required Site Width (ft) Site Depth (ft) Minimum Setbacks Setback lines imposed by a special setback map pursuant to Chapter 20.08 of this code may apply Front Yard (ft) 0'-10'to create an 8' 12' effective sidewalk width (8) None Required 0'-10'to create an 8' - 12' effective sidewalk width (8) 0'-10'to create an 8' - 12' effective sidewalk width (8) Rear Yard (ft) 10' for residential portion; no requirement for commercial portion Rear Yard abutting residential zone district (ft) 10' Interior Side Yard if abutting residential zone district (ft) 10' Street Side Yard (ft) 5' 13 2018111402 Not Yet Approved CN CC CC(2) CS Subject to regulations in: Build -to -Lines 50% of frontage built to setback (1) 33% of side street built to setback (1) Permitted Setback Encroachments Balconies, awnings, porches, stairways, and similar elements may extend up to 6' into the setback. Cornices, eaves, fireplaces, and similar architectural features (excluding flat or continuous walls or enclosures of interior space) may extend up to 4' into the front and rear setbacks and up to 3' into interior side setbacks Maximum Site Coverage 50% 50% 100% 50% Landscape/Open Space Coverage 35% 30% 20% 30% Usable Open Space 20 sq ft for 5 or fewer per unit units (-1-150 sq ft per unit for 6 units or ♦2 (2) Commented [LS10]: T commercial zoning district a single open space require Maximum Height (ft) family units. 1.a Standard 35' (4) 50' 37' 50' Within 150 ft. of a residential zone district (other than an RM-40 or PC zone) abutting or located within 50 feet of the side 35' 35' (5) 35' (5) 35' (5) Daylight Plane for lot lines abutting one or more residential zoning districts Daylight plane height and slope shall be identical to those of the most restrictive residential zoning district abutting the lot line Residential Density (net) (3) 15 or 20 (9) See sub - section (e) below No maximum 30 18.16.060(1) Commented [LS11]: Th residential unit density max Sites on El Camino Real No maximum No maximum CS and CN sites on El Camir 39 0.5:1 (4) 0.6:1 Maximum Residential Floor Area Ratio (FAR) 0.6:1 Maximum Nonresidential Floor Area Ratio (FAR) 0.4:1 2.0:1 0.4:1 Total Mixed Use Floor Area Ratio (FAR) 0.9:1 (4) 2.0:1 1.0:1 0.15:1 10 (7) (10) 0.15:1 (10) Minimum Mixed Use Ground Floor Commercial FAR (6) 0.15:111:1) 0.25:1 14 2018111402 his change implements in this the citywide modification to provide for ment regardless of the number of multi - is amendment would eliminate imums in the CC(2) subdistrict and on io Real. 4.a; 5.a Not Yet Approved CN CC CC(2) CS Subject to regulations in: Parking See Chapters 18.52 and 18.54 (Parking) 18.52, 18.54 I (1) Twenty -five-foot driveway access permitted regardless of frontage; build -to requirement does not apply to CC district. (2) Required usable open space: (1) may be any combination of private and common open spaces; (2) does not need to be located on the ground (but rooftop gardens are not included as open space except as provided below); (3) minimum private open space dimension six feet; and (4) minimum common open space dimension twelve feet. (3) For CN and CS sites on El Camino Real and CC(2) sites that do not abut a single - or two-family residential use or zoning district, rooftop gardens may qualify as usable open space and may count as up to 60% of the required usable open space for the residential component of a project. In order to qualify as usable open space, the rooftop garden shall meet the requirements set forth in Section 18.40.190. Residential density shall be computed based upon the total site area, irrespective of the percent of the site devoted to commercial use. (4) For CN sites on El Camino Real, height may increase to a maximum of 40 feet and the FAR may increase to a maximum of 1.0:1 (0.5:1 for nonresidential, 0.5:1 for residential). (5) For sites abutting an RM-40 zoned residential district or a residential Planned Community (PC) district, maximum height may be increased to 50 feet. (6) Ground floor commercial uses generally include retail, personal services, hotels and eating and drinking establishments. Office uses may be included only to the extent they are permitted in ground floor regulations. (7) (8) A 12 -foot sidewalk width is required along El Camino Real frontage. (9) If located in the California Avenue Parking Assessment District. Residential densities up to 20 units/acre anly-are allowed on CN zoned housing inventory sites identified in the Housing Element. Other CN zoned sites are subject to a maximum residential density of up to 15 units/acre. (10) In the CC(2) zone and on CN and CS zoned sites on El Camino Real, there shall be no minimum mixed use ground floor commercial FAR for a residential project, except to the extent that the retail preservation requirements of Section 18.40.180 or the retail shopping (R) combining district (Chapter 18.30(A)) applies. 15 2018111402 Commented [LS12]: Changes to this footnote would allow rooftop open space to qualify as usable open space for multifamily residential or residential mixed -use projects in the CC(2) subdistrict and on CN and CS zoned sites on El Camino Real, subject to standards specified in new Section 18.40.190 (below) of this ordinance. 4.e; 5.b Not Yet Approved {1) Residential and nonresidential mixcd usc projects shall be subject to site and design review in accord with Chapter 18.30(G), except that mixcd usc projects with nine or fewer residential units shall only require review by the architectural review board. (12) Nonresidential uses that involve the use or storage of hazardous materials in excess of the exempt quantities prescribed in Title 15 of the Municipal Code, including but not limited to dry cleaning plants and auto repair, are prohibited in a mixed use development with residential uses. (23) Residential mixed use development is prohibited on any site designated with an Automobile Dealership (AD) Combining District overlay. (c) Exclusively Residential Uses Exclusively residential uses are generally prohibited in the CN, CS, and CC, and CC(2). zone districts, except on housing inventory sites identified in the Housing Element, subject to the standards in Section 18.16.060(b), and on CS and CN sites on El Camino Real, subject to the following. (1) On CS and CN sites on El Camino Real and on CC(2) sites, where the retail shopping (R) combining district and the retail preservation provisions of Section 18.40.180 do not apply, exclusively residential uses are allowed subject to the standards in Section 18.16.060(b) and the following additional requirements: (A) Residential units shall not be permitted on the ground -floor of development fronting on El Camino Real unless set back a minimum of 15 feet from the property line or the 12 -foot effective sidewalk setback along the El Camino Real frontage, whichever is greater. Common areas, such as lobbies, stoops, community rooms, and work-out spaces with windows and architectural detail are permitted on the ground -floor El Camino Real frontage. (B) Parking shall be located behind buildings or below grade, or, if infeasible, screened by landscaping, low walls, or garage structures with architectural detail. (1) Housing Incentive Program (1) For an exclusively residential or residential mixed -use project in the CC(2) zone or on CN or CS zoned sites on El Camino Real, the Director may waive the 16 2018111402 Commented [LS13]: This change would eliminate site & design review for residential and residential mixed use projects in the commercial zoning district, and only apply the architectural review process like all other projects in this zoning district. 1.b Commented [LS14]: These changes allow for exclusively residential uses in the CC(2) zone and CN or CS zoned sites on El Camino Real, except where the retail preservation ordinance or the retail shopping (R) combining distrct applies. The changes also require that for frontages on El Camino Real, an exclusively residential project be designed to maintain ground -floor interest. 4.b, 5.d Commented [LS1 5] : This new subsection would authorize the Director to grant zoning waivers to allow increased FAR for the residential portion of a project, and to waive other development standards for a 100%affordable housing project, in the CC(2) subdistrict and on CN or CS zoned sites on El Camino Real, subject to architectural review. 4.f; 5.e Not Yet Approved residential floor area ratio (FAR) limit and the maximum site coverage requirement after the project with the proposed waiver or waivers is reviewed by the Architectural Review Board, if the Director finds that a project exceeding these standards is consistent with the required architectural review findings. In no event shall the Director approve a commercial FAR that exceeds the standard in Table 4 of Section 18.16.060(b) or a total FAR (including both residential and commercial FAR) in excess of 2.0 in the CC(2) zone or 1.5 in the CN or CS zone. (2) For a 100% affordable housing project in the CC(2) zone or on CN or CS zoned sites on El Camino Real, the Director may waive any development standard including parking after the project with the proposed waiver or waivers is reviewed by the Architectural Review Board, if the Director finds that a project with such waiver or waivers is consistent with the required architectural review findings. In no event shall the Director approve development standards more liberal than the standards applicable to the Affordable Housing (AH) Combining District in Chapter 18.30(1). A "100% affordable housing project" as used herein means a multiple -family housing or mixed -use project in which the residential component consists entirely of affordable units, as defined in Section 16.65.020 of this code, available only to households with income levels at or below 120% of the area median income, as defined in Section 16.65.020, with an average not to exceed 60% of the area median income, except for a building manager's unit. (3) This program is a local alternative to the state density bonus law, and therefore, a project utilizing this program shall not be eligible for a density bonus under Chapter 18.15 (Density Bonus). (i) Parking and Vehicular Access on California Avenue Restricted Vehicular access to CC(2) zoned sites on California Avenue which requires vehicular movement across the sidewalk on California Avenue shall be prohibited, except where required by law and as applied to parcels owned, leased or controlled by the City. SECTION 7. Subsections (b) and (c) of Section 18.18.060 (Development Standards) of Chapter 18.18 (Downtown Commercial (CD) District) of Title 18 (Zoning) of the PAMC are amended as follows: Section 18.18.060 Development Standards (b) Mixed Use and Residential Table 3 specifies the development standards for new residential mixed use developments and 17 2018111402 Com m en ted [ LS16] : This new subsection would preclude curb cuts on California Avenue, except for City parcels. 4.d Not Yet Approved residential developments. These developments shall be designed and constructed in compliance with the following requirements and the context -based design criteria outlines in Section 18.18.110, provided that more restrictive regulations may be recommended by the architectural review board and approved by the director of planning and community environment, pursuant to Section 18.76.020: TABLE 3 MIXED USE AND RESIDENTIAL DEVELOPMENT STANDARDS CD -C CD -S CD -N Subject to regulations in Section: Minimum Setbacks Setback lines imposed by a special setback map pursuant to Chapter 20.08 of this code may apply Front Yard (ft) None required 10' Rear Yard (ft) 10' for residential portion; no requirement for commercial portion Interior Side Yard (ft) No requirement 10' if abutting residential zone 10' if abutting residential zone Street Side Yard (ft) No requirement 5' 5' Permitted Setback Encroachments Balconies, awnings, porches, stairways, and similar elements may extend up to 6' into the setback. Cornices, eaves, fireplaces, and similar architectural features (excluding flat or continuous walls or enclosures of interior space) may extend up to 4' into the front and rear setbacks and up to 3' into interior side setbacks Maximum Site Coverage No requirement 50% 50% Landscape Open Space Coverage 20% 30% 35% Usable Open Space 200 sq ft for 5 or fcwcr per unit units44; 150 sq ft per unit for 6 units or morci�1 Com comm a fasmil Y Maximum Height (ft) 18 2018111402 m ented [LS17]: This change implements in the downtown ercial zoning district the citywide modification to provide for e open space requirement regardless of the number of multi - units. 1.a Not Yet Approved Standard Within 150 ft. of an abutting residential zone Daylight Plane for lot lines abutting one or more residential zoning districts or a residential PC district Residential Density (net)(z) Maximum Weighted Average Residential Unit Sizes) Maximum Residential Floor Area Ratio (FAR) Maximum Nonresidential Floor Area Ratio (FAR) Total Floor Area Ratio (FAR)(3) Parking Requirement (1) CD -C 40'(4) CD -S 40'(4) CD -N 35'(4) Daylight plane height and slope identical to those of the most restrictive residential zone abutting the lot line 40 No maximum 1,500 sq ft per unit 1.0:1(3) 1.0:1(3) 30 No maximum 0.6:1(3) 0.4:1 30 No maximum 0.5:1(3) 0.4:1 See Chapters 18.52 and 18.54 Subject to regulations in Section: Commented [ LS18] : This change implements a maximum average unit size for residential units in a project. 3.b 18.18.070 Chs. 18.52, 18.54 Required usable open space: (1) may be any combination of private and common open spaces; (2) does not need to be located on the ground (but rooftop gardens are not included as open space except as provided below); (3) minimum private open space dimension 6'; and (4) minimum common open space dimension 12'. For CD -C sites that do not abut a single- or two-family residential use or zoning district, rooftop gardens may qualify as usable open space and may count as up to 75% of the required usable open space for the residential component of a project. In order to qualify as usable open space, the rooftop garden shall meet the requirements set forth in Section 18.40.190. (2) Residential density shall be computed based upon the total site area, irrespective of the percent of the site devoted to commercial use. There shall be no deduction for that portion of the site area in nonresidential use. 19 2018111402 Commented [LS19]: Changes to this footnote would allow rooftop open space to qualify as usable open space for multifamily residential or residential mixed -use projects in the CD -C zone subject to standards specified in new Section 18.40.190 (below) of this ordinance. 1.a Not Yet Approved (3) FAR may be increased with transfers of development and/or bonuses for seismic and historic rehabilitation upgrades, not to exceed a total site FAR of 3.0:1 in the CD -C subdistrict or 2.0:1 in the CD -S or CD -N subdistrict. (4) For sites abutting an RM-40 zoned residential district or a residential Planned Community (PC) district, maximum height may be increased to 50 feet. (5) The weighted average residential unit size shall be calculated by dividing the sum of the square footage of all units by the number of units. For example, a project with ten 800 -square foot 1 -bedroom units, eight 1,200 -square foot 2 - bedroom units, and two 1,800 -square foot 3 -bedroom units would have a weighted average residential unit size of ((10x800)+(8x1200)+(2x1800)) (10+8+2) = 1,060 square feet. {1) Residential and nonresidential mixcd use projects shall be subject to sitc and design review in accord with Chapter 18.30(G), except that mixcd use projects with nine or fcwcr units shall only require review and approval by the architectural review board. (12) Nonresidential uses that involve the use or storage of hazardous materials in excess of the exempt quantities prescribed in Title 15 of the Municipal Code, including but not limited to dry cleaning plants and auto repair, are prohibited in a mixed use development with residential uses. (c) Exclusively Residential Uses (1) Exclusively residential uses are allowed in the CD -C subdistrict, except in the ground floor (GF) combining district. (2) Exclusively residential uses are generally prohibited in the CD district and CD -N and CD -S subdistricts. Such uses are allowed, however, where a site is designated as a Housing Opportunity Sitohousing inventory site in the Housing Element of the Comprehensive Plan. Such sites shall be developed pursuant to the regulations for the multi -family zone designation (RM-204 , RM-30, or RM- 40) identified for the site in the Housing Element. (1) Housing Incentive Program (1) For an exclusively residential or residential mixed -use project in the CD -C zone, the Director may waive the residential floor area ratio (FAR) limit after the project with the proposed waiver is reviewed by the Architectural Review Board, if the Director finds that the project exceeding the FAR standard is consistent with the required architectural review findings. In no event shall the Director approve a commercial FAR in excess of 1.0 or a total FAR (including both 20 2018111402 Commented [LS20]: This change would eliminate site & design review for residential and residential mixed use projects in the downtown commercial zoning district, and only apply the architectural review process like all other projects in this zoning district. 1.b Commented [LS21]: This change would allow residential -only development in the downtown, except in the ground floor (GF) combining district. 3.e Com m en ted [ LS22] : This new subsection would authorize the Director to grant zoning waivers to allow increased FAR for the residential portion of a project, and to waive other development standards for a 100%affordable housing project, in the CD -C subdistrict, subject to architectural review. 3.h Not Yet Approved residential and commercial FAR) in excess of 3.0. Nor shall the use of transferable development rights under Section 18.18.080 be allowed to cause the site to exceed a FAR of 3.0. (2) For a 100% affordable housing project in the CD -C zone, the Director may waive any development standard including parking after the project with the proposed waiver or waivers is reviewed by the Architectural Review Board, if the Director finds that a project with such waiver or waivers is consistent with the required architectural review findings. In no event shall the Director approve a FAR in excess of 3.0 or approve other development standards more liberal than the standards applicable to the Affordable Housing (AH) Combining District in Chapter 18.30(J). A "100% affordable housing project" as used herein means a multiple -family housing or mixed -use project in which the residential component consists entirely of affordable units, as defined in Section 16.65.020 of this code, available only to households with income levels at or below 120% of the area median income, as defined in Section 16.65.020, with an average not to exceed 60% of the area median income, except for a building manager's unit. (3) This program is a local alternative to the state density bonus law, and therefore, a project utilizing this program shall not be eligible for a density bonus under Chapter 18.15 (Density Bonus). (m) Parking and Vehicular Access on University Avenue Restricted Vehicular access to CD -C zoned sites on University Avenue which requires vehicular movement across the sidewalk on University Avenue shall be prohibited, except where required by law and as applied to parcels owned, leased or controlled by the City. SECTION 8. Subsection (d) of Section 18.18.090 (Parking and Loading) of Chapter 18.18 (Downtown Commercial (CD) District) of Title 18 (Zoning) of the PAMC is amended as follows: Section 18.18.090 Parking and Loading (d) In -lieu Parking Provisions In connection with any expansion of the supply of public parking spaces within the CD commercial downtown district, the city shall allocate a number of spaces for use as "in - lieu parking" spaces to allow development to occur on sites which would otherwise be precluded from development due to parking constraints imposed by monetary contribution to the city to defray the cost of providing such parking. Contributions for each required parking space shall equal the incremental cost of providing a net new 21 2018111402 Commented [ LS23] : This new subsection would preclude curb cuts on University Avenue, except for City parcels. 3.d Not Yet Approved parking space in an assessment district project plus cost for the administration of the program, all as determined pursuant to Chapter 16.57 of Title 16 of this code, by the director of planning and community environment, whose decision shall be final. Only sites satisfying one or more of the following criteria, as determined by the director of planning and community environment, shall be eligible to participate in the in -lieu parking program: (1) Construction of on -site parking would necessitate destruction or substantial demolition of a designated historic structure; (2) The site area is less than 10,000 square feet, but of such an unusual configuration that it would not be physically feasible to provide the required on - site parking; (3) The site is greater than 10,000 square feet, but of such an unusual configuration that it would not be physically feasible to provide the required on - site parking; (4) The site is located in an area where city policy precludes curb cuts or otherwise prevents use of the site for on -site parking; or (5) The site has other physical constraints, such as a high groundwater table, which preclude provision of on -site parking without extraordinary expense. Commercial uses above the ground floor shall not be eligible to participate in the in -lieu parking program. SECTION 9. Section 18.40.180 (Retail Preservation) of Chapter 18.40 (General Standards and Exceptions) of Title 18 (Zoning) of the PAMC is amended as follows: Section 18.40.180 Retail Preservation (a) Conversion of Retail and Retail -Like Uses Prohibited. (1) Any ground floor Retail or Retail -Like use permitted or operating as of March 2, 2015 may be replaced only by another Retail or Retail -Like use, as permitted in the applicable district. (A) A ground floor Retail or Retail -Like use in the RT-35 district on properties with frontage on Alma Street between Channing Avenue and Lincoln Avenue may additionally be replaced by a Private Educational Facility use, provided that such use shall not be thereafter replaced by an Office use. (2) The phrase 'use permitted or operating' as used in this section means: 22 2018111402 Commented [LS24]: This change would restrict the use of in - lieu parking for commercial uses above the ground floor to further incentivize housing development. Not Yet Approved (A) A lawfully established use conducting business, including legal non- conforming uses. (B) An established use conducting business without required city approvals, but is a permitted or conditionally permitted use in district. (C) For parcels vacant on March 2, 2015, the last use that was lawfully established, or established without required permits, and permitted or conditionally permitted in the district. (b) Non -conforming Uses. (1) The requirements imposed by subsection (a) shall not apply to Retail or Retail - like uses that are no longer permitted or conditionally permitted in the applicable district. (2) Nothing in this section shall modify the provisions of Chapter 18.70 regarding the expansion, change, discontinuance, or termination of a non -conforming use. (c) Waivers and Adjustments; and Exemptions. (1) Grounds. The following shall be grounds for a request for waiver or adjustment of the requirements contained in this section: (A) Economic Hardship. An applicant may request that the requirements of this section be adjusted or waived based on a showing that applying the requirements of this section would effectuate an unconstitutional taking of property or otherwise have an unconstitutional application to the property; or (B) Alternative Viable Active Use. Except in the GF or R combining districts, an applicant may request that the requirements of this Section 18.40.160 be adjusted or waived based on a showing that: the permitted retail or retail - like use is not viable; the proposed use will support the purposes of the zoning district and Comprehensive Plan land use designation; and the proposed use will encourage active pedestrian -oriented activity and connections. (2) Documentation. The applicant shall bear the burden of presenting substantial evidence to support a waiver or modification request under this Section and shall set forth in detail the factual and legal basis for the claim, including all supporting technical documentation. Evidence in support of a waiver under subsection (c)(1)(B) must demonstrate the viability of existing and future uses on the site, based on both the site characteristics and the surrounding uses; specifically whether a substitute use could be designed and/or conditioned to 23 2018111402 Com m en ted [ LS25] : The changes to this subsection would exempt 100% affordable projects (excluding manager's unit) from the Retail Preservation Ordinance, except in the GF and R combining districts. 1.c Not Yet Approved contribute to the goals and purposes of the zoning district. Examples of such evidence include: (A) A 10 -year history of the site's occupancy and reasons for respective tenants vacating the site; (B) A map that indicates all the existing surrounding uses, both residential and non-residential, within one City -block; include the corresponding zone district on the map; (3) Any request under this section shall be submitted to the Director together with supporting documentation. The Director, in his or her sole discretion, may act on a request for waiver or refer the matter to the City Council. (A) A decision by the Director shall be placed on the City Council's consent calendar within 45 days. (B) Removal of the recommendation from the consent calendar shall require three votes, and shall result in a new public hearing before the City Council, following which the City Council shall take action on the waiver request. (C) The decision of the Council is final. (4) Exemptions. The provisions of this Chapter shall not apply to: (A) A 100% affordable housing project not within the Ground Floor (GF) and/or Retail (R) combining districts or on a site abutting El Camino Real . A "100% affordable housing project" as used herein means a multiple -family housing project consisting entirely of affordable units, as defined in Section 16.65.020 of this code, available only to households with income levels at or below 120% of the area median income, as defined in Chapter 16.65, except for a building manager's unit. SECTION 10. Chapter 18.40 (General Standards and Exceptions) of Title 18 (Zoning) of the PAMC is amended to add a new Section 18.40.190 (Rooftop Gardens) as follows: Section 18.40.190 Rooftop Gardens Where allowed under this Title, in order to qualify as usable open space, a rooftop garden shall meet the following standards: (a) Permanent fixtures on the rooftop shall be placed so as not to exceed height limit for the applicable zoning district, except: 24 2018111402 Not Yet Approved (i) Elevators, stairs and guardrails may exceed the height limit to allow for access to the rooftop useable open space as and to the extent required to comply with the Americans With Disabilities Act (ADA). These fixtures shall be designed to the lowest height and size feasible. (ii) Permanent fixtures associated with the useable open space, such as trellises, shade structures, furniture, and furnishings such as planters, lighting and heaters, may exceed the height limit by up to 12 feet. (iii) For the height limit exceptions in (i) and (ii) above, all fixtures shall not intersect a plane measured at a forty-five degree angle from the edge of the building starting at the rooftop garden surface sloping upward and inward toward the center of the property. (b) The rooftop garden may be located on the second or higher story or on a roof deck. (c) The rooftop garden shall be accessible to all residents of dwelling units on the parcel, but not to commercial tenants of a residential mixed -use development. (d) Structures or fixtures providing a means of access or egress (i.e., stairway, elevator) shall be located away from the building edge to the extent feasible or screened to minimize visibility from the public right-of-way and adjacent buildings and privacy impacts. These access structures or fixtures, when exceeding the height limit, shall be subject to the provisions of subsection (a)(iii) above. (e) Any lighting shall have cutoff fixtures that cast downward -facing light or consist of low- level string lights. Lights shall be dimmable to control glare and placed on timers to turn off after 10:00 PM. Photometric diagrams must be submitted by the applicant to ensure there are no spillover impacts into windows or openings of adjacent properties. (f) At least 15% but no more than 25% of the rooftop shall be landscaped with raised beds for gardening, C.3 stormwater planters, or other landscaping. All required landscaped areas shall be equipped with automatic irrigation systems and be properly drained. (g) Rooftop equipment that emit noise and/or exhaust, including but not limited to vents, flues, generators, pumps, air conditioning compressors, and other protrusions through the roof, shall be directed away and screened from the useable open space areas. (h) Rooftop open space noise levels shall not exceed exterior residential noise level as defined by Section 9.10.030(a) of this code. (i) The use of sound amplifying equipment shall be prohibited. Signs shall be affixed adjacent to access elevators and stairs within the rooftop garden providing notice of this prohibition. 25 2018111402 Not Yet Approved SECTION 11. Table 1 (Minimum Off -Street Parking Requirements) and Table 2 (Minimum Off - Street Parking Requirements for Parking Assessment Districts) of subsection (c) of Section 18.52.040 (Off- Street Parking, Loading and Bicycle Facility Requirements) of Chapter 18.52 (Parking and Loading Requirements) of Title 18 (Zoning) of the PAMC are amended as follows: Section 18.52.040 Off- Street Parking, Loading and Bicycle Facility Requirements (c) Tables 1, 2 and 3: Parking, Bicycle, and Loading Requirements Tables 1 and 2 below outline vehicle and bicycle parking requirements in general and for Parking Assessment Districts, respectively. Table 3 outlines loading requirements for each land use. For mixed -use projects, the requirements for each land use shall be applied and required for the overall project. Table 1 Minimum Off -Street Parking Requirements Use Vehicle Parking Requirement (# of spaces) Bicycle Parking Requirement Spaces Class 1 Long Term (LT) and Short Term (ST) RESIDENTIAL USES Comm 1 per micro unit (2) Section residen 15 per studio unit 1,5 per 1 -bedroom unit availab housin€ near a project Multiple -Family Residential 2 per 2 -bedroom or larger unit At least one space per unit must be covered Tandem parking allowed for any unit requiring two spaces (one tandem space per unit, associated directly with another parking space for the same unit, up to a maximum of 25% of total required spaces for any project with more than four (4) units) 1 per unit o 100%- LT Multiple -Family 0.5 per micro unit (2) Residential Near 0.8 per studio unit Fixed Rail Station111 26 2018111402 ented [ LS26] : The changes to the Residential Uses in this implement reduced parking requirements for multifamily tial projects generally, and convert the parking adjustments le for senior housing, housing near transit, and affordable into by -right reduced standards for senior housing, housing najor fixed rail station and 100% affordable housing 1.d Not Yet Approved ll 0.8 per 1 -bedroom unit 1.6 per 2 -bedroom or larger unit (a) Guest Parking No additional guest parking 1 space for each 10 units ° 100% ST required For projects exceeding 3 units; 1 space plus 10% of total number of units, that if more provided than one space per unit is assigned or secured parking, then guest spaces equal to 33% of all units is required. 100% Affordable a. 40% reduction in the 1 per unit 100%- LT applicable parking requirement for Extremely Low Income units Housing (4)(7) b. 30% reduction for Very Low Income units c. 20% reduction for Low Income units Com r Altern parkin (5)(7) Senior Housing 0.75 per unit RETAIL USES- Retail: (a) Intensive (retail not defined as extensive) 1 per 200 sq. ft. of gross floor area 1 per 2,000 sf 20% - LT 80% -ST (b) Extensive (retail with more than 75% of gross floor area used for display, sales and related storage, with demonstrably low parking demand 1 per 350 sq. ft. of gross floor area 1 per 3,500 sf 20% LT 4080% ST 27 2018111402 ented [LS27]: tive option: 0.75 per unit consistent with the residential standard for the Affordable Housing (AH) combining district Not Yet Approved generation per square foot of gross floor area) (c) Open lot Drive -up windows providing services to occupants in vehicles 1 space for each 500 square feet of sales, display, or storage site area Queue line for 5 cars, not blocking any parking spaces, in addition to other applicable requirements 1 per 5,000 sf 100% -ST None additional Eating and Drinking Services: (a) With drive-in or take-out facilities (b) All others 3 per 100 sq. ft. of gross floor area 1 space for each 60 gross sq. ft. of public service area, plus 1 space for each 200 gross sq. ft. for all other areas. 3 per 400 sf 40% - LT 60% - ST 1 per 600 sf of public service area, plus 1 per 2,000 sf for other areas (1) Long Term (LT) and Short Term (ST) bicycle spaces as described in Section 18.54.060. 2) A "micro -unit" as used herein means a residential unit of 450 souare feet or less. (3) These standards apply to housing projects, other than 100% affordable housing projects, on parcels located within one-half mile radius of a major fixed rail transit station (as measured from the platform). Projects that qualify for and utilize this reduced parking requirement shall provide at least one annual transit pass (i.e., Caltrain go -pass) per unit to the unit occupant on an ongoing basis or implement an equally effective measure approved by the Director for the life of the project. (4) Applies to 100% affordable housing projects and the residential component of 100% affordable housing mixed -use projects. "100% affordable housing" as used herein means a multiple -family housing project consisting entirely of affordable units, as defined in Section 16.65.020 of this code, available only to households with income levels at or below 120% of the area median income, as defined in Chapter 16.65, except for a building manager's unit. 28 2018111402 Not Yet Approved (5) Senior housing for purposes of this provision means an independent living facility, not a convalescent or residential care facility. (6) For residential mixed -use developments in the CD -C zone, CC(2) zone, and on CN and CS zoned sites abutting El Camino Real, the first 1,500 square feet of ground -floor retail uses shall not be counted toward the vehicle parking requirement. (7) Because these parking standards are reduced from the standards otherwise applicable to multiple -family residential development, projects that utilize these reduced parking standards shall not be eligible for further parking reductions through adjustments under Section 18.52.050, Table 4. Table 2 Minimum Off -Street Parking Requirements for Parking Assessment Districts (IF USE IS NOT LISTED, REFER TO TABLE 1 FOR REQUIREMENTS) Com m ented [LS28] : The changes to the Retail Uses in this Section would exempt the first 1500 sf of ground -floor retail from parking requirements citywide to relieve physical and financial constraints of providing retail. 3.c, 4.c, 5.c Use Vehicle Parking Requirement (# of spaces) Bicycle Parking Requirement Class 1 Spaces For Downtown University Avenue Parking Assessment District: All uses (except residential) 1 per 250 square feet 1 per 2,500 square feet 40% - LT 60% - ST For California Avenue Parking Assessment District: Retail:2 (a) Intensive 1 per 240 sf of gross floor area 1 per 2,400 sf 20% - LT 80% - ST (b) Extensive 1 per 350 sf of gross floor area 1 per 3,500 sf (c) Open Lot 1 for each 500 square feet of sales, display, or storage site area. 1 per 5,000 sf 100%- LT 1. Long Term (LT) and Short Term (ST) bicycle spaces as described in Section 18.54.060. 2. For residential mixed -use developments in the CD -C zone, CC(2) zone, and on CN and CS zoned sites abutting El Camino Real, the first 1,500 square feet of ground -floor retail uses shall not be counted toward the vehicle parking requirement. 29 2018111402 Not Yet Approved SECTION 12. Table 4 (Allowable Parking Adjustments) of Section 18.52.050 (Adjustments by the Director) of Chapter 18.52 (Parking and Loading Requirements) of Title 18 (Zoning) of the PAMC is amended as follows: Section 18.52.050 Parking and Loading Requirements Automobile parking requirements prescribed by this chapter may be adjusted by the director in the following instances and in accord with the prescribed limitations in Table 4, when in his/her opinion such adjustment will be consistent with the purposes of this chapter, will not create undue impact on existing or potential uses adjoining the site or in the general vicinity, and will be commensurate with the reduced parking demand created by the development, including for visitors and accessory facilities where appropriate. No reductions may be granted that would result in provision of less than ten (10) spaces on a site. The following are adjustments that apply to developments not located within a parking assessment district. Adjustments within the parking assessment districts are contained in Section 18.52.080. The decision of the regarding parking adjustments may be appealed as set forth in Chapter 18.78 (Appeals). Table 4 Allowable Parking Adjustments Purpose of Adjustment Amount of Adjustment Maximum Reduction 2a On -Site Employee Square footage of commercial or 100% of requirement for Amenities industrial uses to be used for an on -site on -site employee cafeteria, recreational facility, and/or day care facility, to be provided to employees or their children and not open to the general public, may be exempted from the parking requirements amenities Joint Use (Shared) For any site or sites with multiple uses 20% of total spaces Parking Facilities where the application of this chapter requires a total of or more than ten (10) spaces, the total number of spaces otherwise required by application of required for the site Table 1 may be reduced when the joint facility will serve all existing, proposed, and potential uses as effectively and conveniently as would separate parking facilities for each use or site. In making such a determination, the director shall consider a parking analysis using criteria developed by the Urban Land Institute (ULI) or similar methodology to estimate 30 2018111402 Commented [LS29]: These changes remove parking reductions available because these reductions will become by -right parking standards for the specific types of developments referenced. 1.d Not Yet Approved Purpose of Adjustment Amount of Adjustment Maximum Reduction 2a the shared parking characteristics of the proposed land uses. The analysis shall employ the city's parking ratios as the basis for the calculation of the base parking requirement and for the determination of parking requirements for individual land uses. The director may also require submittal and approval of a TDM program 1 to further assure parking reductions are achieved. Housing for Seniors The total 50% the total number of spaces required may be reduced for housing facilities for of spaces required for thc site seniors, commensurate with the reduced demand created by the parking housing facility, including for visitors. and accessory facilities, and subject to submittal and approval of a parking thc analysis justifying reduction proposed. Affordable Housing Units and Single Room Occupancy (SRO) Units L3l The total number of spaces required may be reduced for affordable housing and single room occupancy (SRO) units, commensurate with the reduced parking demand created by the housing facility, including for visitors and accessory facilities. The reduction shall consider proximity to transit and support services and the director may require traffic demand management measures' in conjunction with any approval. a. 40% for Extremely Low Income and SRO Units b. 30% for Very Low Income Units c. 20% for Low Income Units Housing Near Transit Facilities (3) The total number of spaces required may be reduced for housing located within a designated Pedestrian/Transit Oriented area or elsewhere in immediate proximity to public transportation facilities serving a significant portion of residents, employees, or customers, when such reduction will be commensurate with the reduced parking demand created by the housing facility, including for visitors and accessory facilities, and subject to 20% of the total spaces required for the site. 31 2018111402 Not Yet Approved Purpose of Adjustment Amount of Adjustment Maximum Reduction 2a submittal and approval of a TDM program.' Transportation and Parking Alternatives Where effective alternatives to automobile access are provided, other than those listed above, parking requirements may be reduced to an extent commensurate with the permanence, effectiveness, and the demonstrated reduction of off-street parking demand effectuated by such alternative programs. Examples of such programs may include, but are not limited to, transportation demand management (TDM) programs or innovative parking pricing or design solutions.' (note: landscape reserve requirement is deleted). 20% of the total spaces required for the site Combined Parking Adjustments Parking reductions may be granted for any combination of the above circumstances as prescribed by this chapter, subject to limitations on the combined total reduction allowed. a. 30% reduction of the total parking demand otherwise required b. 40% reduction for affordable housing projects c. 50% rcduction for ;cnior housing projcct5 Modification to Off- Street Loading Requirements The director may modify the quantity or dimensions of off-street loading requirements for non-residential development based on existing or proposed site conditions; availability of alternative means to address loading and unloading activity; and, upon finding that: 1) the off-street loading requirement may conflict with Comprehensive Plan goals and policies related to site design planning, circulation and access, or urban design principles; and 2) the use of shared on - street loading would not conflict with Comprehensive Plan goals and policies related to site design planning, circulation and access or urban design One loading space may be waived 32 2018111402 Not Yet Approved Purpose of Adjustment Amount of Adjustment Maximum Reduction 2a principles; maximum reduction in one loading space. 1. See Section 18.52.050(d) below regarding requirements for TDM programs. 2. No parking reductions may be granted that would result in provision of less than ten (10) parking spaces on site. 3. No parking reductions may be granted for projects that are entitled to the reduced parking standards in Table 1 of Section 18.52.040 for multiple -family residential near a major fixed rail station, 100% affordable housing and senior housing. (a) Combining Parking Adjustments Parking reductions may be granted for any combination of circumstances, prescribed by this chapter, so long as in total no more than a 30% reduction of the total parking demand otherwise required occurs, or no less than a 40% reduction for affordable housing projects (including Single Room Occupancy (SRO) units), or no less than 50% reduction for senior housing projects. SECTION 13. Subsection (c) of Section 18.52.070 (Parking Regulations for CD Assessment District) of Chapter 18.52 (Parking and Loading Requirements) of Title 18 (Zoning) of the PAMC is amended as follows: Section 18.52.070 Parking Regulations for CD Assessment District (c) In -lieu Parking Provisions Within the CD commercial downtown district, the provisions of Section 18.18.090(d) shall apply. In connection with any expansion of thc supply of public parking spaces within thc CD commercial downtown district, thc city shall allocate a number of spaces for use as "in lieu parking" spaces to allow development to occur on sites which would otherwise be precluded from development due to parking constraints imposed by monetary contribution to thc city to defray thc cost of providing such parking. Contributions for ach required parking space shall equal the incremental cost of providing a net new parking space in an assessment district project plus cost for the administration of the program, all as determined pursuant to Chapter 16.57 of Title 16 of this code, by the 33 2018111402 Commented [LS30]: The changes to this subsection would incorporate the new restriction on the use of in -lieu parking for commercial uses above the ground floor in Chapter 18.18 above, and would remove the repetition of the in -lieu parking provisions in Chapter 18.52, instead simply referencing the provisions as previously stated in Chapter 18.18. Even if the substantive change to Section 18.18.090(d) is not approved, staff recommends approval of the proposed change here as an administrative clean-up to remove unnecessary repetition of the in -lieu parking provisions. Not Yet Approved director of planning and community environment, whose decision shall be final. Only cites satisfying one or more of the following criteria, as determined by the director of planning and community environment, shall be eligible to participate in the in lieu parking program: {1) Construction of on site parking would necessitate destruction or substantial demolition of a designated historic structure; {2) The site ar a is less than 10,000 square feet, but of such an unusual configuration that it would not bc physically f asiblc to provide the required on site parking; {3) The site is gr ater than 10,000 square feet, but of such an unusual configuration that it would not bc physically f asiblc to provide the required on site parking; {1) Thc sitc is located in an ar a where city policy precludes curb cuts or otherwise prevents use of the site for on site parking; or {5) Thc sitc has other physical constraints, such as a high groundwater table, which preclude provision of on site parking without extraordinary expense. SECTION 14. Any provision of the Palo Alto Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance. SECTION 15. This Ordinance shall not apply to any project for which the application has been deemed complete as of the effective date of the Ordinance, for the last required discretionary approval for the project. However, the project applicant may elect to be subject to this Ordinance in which case the Ordinance in its entirety shall apply to the project. SECTION 16. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional. SECTION 17. The Council finds that the potential environmental impacts related to this Ordinance were analyzed in the Final EIR for the Comprehensive Plan Update, which was certified and adopted by the Council by Resolution No. 9720 on November 13, 2017. The Ordinance is consistent with and implements the program evaluated in the EIR. 34 2018111402 Not Yet Approved SECTION 18. This Ordinance shall be effective on the thirty-first date after the date of its adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: NOT PARTICIPATING: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Assistant City Attorney City Manager Director of Planning & Community Environment 35 2018111402 CD -C Downtown Zoning Analysis Site Diagram High/Hamilton Parking Lot Parcel Size: 150' x Zoo' 15,00o sf 0.34 acres Zoning Analysis Study 1) Existing Mixed -Use Zoning 2) Proposed l00% Residential, 50' Height, 3.0 FAR Max 3) Proposed l00% Affordable Residential, 60' Height, 4.0 FAR Max EMI raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CD -C Downtown Zoning Analysis Existing Mixed -Use Zoning Massing Diagram Existing Standards: Height: 50 ft Res FAR: 1.0 Com FAR: 1.0 FAR: 2.0 max Statistics: Height: 50 ft, 4 stories Res FAR: 1.0 Comm. FAR: 1.0 Parking FAR: 0.34 (not counted in total FAR) FAR: 2.0 Retail: 4,300 sf Office: 10,700 sf Residential.: 10 units Avg Unit: 1,116 sf Density: 29 du/a Res. Parking: 20 sp Comm. Parking: 35 sp " *55 required, 20 Located offsite, $70,000 in -Lieu fee would be required per space H 4th Floor 3rd Floor 2nd Floor I� Retail 1st Floor Basement Levels (Bi * B2) Floor Plans Building Section raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CD -C Downtown Zoning Analysis Existing Mixed -Use Zoning Massing in Context: Statistics: CD -C Downtown Zoning Analysis Parcel Gross Area Acres Standards FAR Max GSF 2091 Residential Landscape/0 Parking Studio 1 BR 2 BR 3 8R Guest Commercial Parking Retail Address 15,000.0 sf 0.34 2.0 30,000.0 sf 3,000.0 sf 20 1.25 1.5 2 2 10%+1 60 250 Notes: Floor Circ/Common Landscape Open Space Studio 1 BR 2 BR 3 BR Total Parking/Mech. Spaces Gross Area Retail Net Res 5 0.0 0 units 4 6,980.0 5,580.0 sf 1,400,0 sf 0 units 3 6,980.0 5,580.0 sf 1,400.0 sf 3,320.0 sf 2 3 ' 5 units 2 10,300.0 10,000.0 sf 300.0 sf 3,500.0 sf 2 3 ' 5 units 1 10,850.0 5,000.0 sf 750.0 sf 750 0 0 0 units 5,100.0 sf 9 61 13,675.0 13,675.0 sf 22 B2 13,675.0 13,675.0 sf 24 Totals 62,460sf 15,000sf 11,160sf 3,850sf 750 sf 6,820sf 0 4 6 0 10 units 32,450.0sf 55sp Retail 4,300.0sf 0% 40% 60% 0% Office 10,700.0sf 40% 60% Summary Stats FAR 2.0 Efficiency 74% OS Standard 150 sf/unit DU/A 29.0 OS Req'd 1,500 sf Units 10 units Parking 55 sp Common Open Space 6,820 sf Avg Unit 1,116.0 sf Parking Ratio 5.5 Private Open Space TBD Lanscape/OS Req'd 3,000 sf 20% RES FAR 1.00 Parking FAR 0.34 Landscape/OS 7,570 sf COMM FAR 1.00 raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CD -C Downtown Zoning Analysis Proposed: 50' Height - 3.0 FAR - 100% Residential Massing Diagram Proposed Standards: Height: 50 ft Res FAR: 3.0 Tot FAR: 3.0 max Statistics: Height: 50 ft, 4.5 stories Res FAR: 2.82 Parking FAR: 0.10 (not included in Total FAR) FAR: 2.82 Residential: 36 units Avg Unit: 881 sf Density: 104 du/a Parking: 39 sp (1.08:1) `includes puzzle lifts Project Qualifies for reduced parking standards due to proximity to fixed rail transit. Caltrain Go Passes required for each unit. ($285/user or $23,940, whichever is greater) Roof 1 r 3rd/4th Floors x 1 I 2nd Floor r x I A Ground Floor 1 A x I Basement Floor Plans dualP Oa. Building Section MEM raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CD -C Downtown Zoning Analysis Proposed: 50' Height - 3.o FAR - s00% Residential Massing in Context: Statistics: CD -C Downtown Zoning Analysis Parcel Gross Area Acres Standards FAR Max GSF 20% Landscape/0 Residential Parking Studio 1 BR 2 BR 3 BR Guest Commercial Parking Retail Address 15,000.0 sf 0.34 3.0 45,000.0 sf 3,000.0 sf 38.4 0.8 0.6 1.6 1.6 0% Notes: Floor Gross Area Retail Net Res Circ/Common Landscape Open Space Studio 1 BR 2 BR 3 BR Total Parking/Mech. Spaces Roof 4 3 2 1 B1 800.0 10,625.0 10,625.0 10,625.0 11,166.0 15,000.0 8,650.0 sf 8,650.0 sf 8,650.0 sf 5,766.0 sf 800.0 sf 1,975.0 sf 1,975.0 sf 1,975.0 sf 3,900.0 sf 1,848.0 sf 0 875.0 sf 0 3,150.0 sf 0 0 7 2 7 2 7 2 3 3 " 0 units 1,500.0 sf 0 15,000.0 sf 39 1 10 units 1 ' 10 units 1 ' 10 units 0 6 units Totals Summary Stats 58,841 sf 0 sf 31,716 sf 10,625 sf 0 sf 5,873 sf 0 0% 67% 24 9 3 36 units 16,500.0 sf 39 sp 67% 25% 8% 33% _ FAR DU/A Units Avg Unit RES FAR COMM FAR 2.82 104.5 36 units 881.0 sf 2.82 0.00 Efficiency Parking' Parking Ratio Parking FAR 75% 39 sp 1.08 0.10 OS Standard OS Req'd Common Open Space Private Open Space Lanscape/OS Req'd Landscape/OS 150 sf/unit 5,400 sf 5,873 sf 'includes puzzle lifts TBD" " Remainder of OS to be provided in Balconies 3,000 sf 20% 5,873 sf raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 pg 5 CD -C Downtown Zoning Analysis Proposed: 6o' Height - 4.o FAR - i00% Affordable Residential Massing Diagram Proposed Standards: Height: 60 ft Res FAR: 4.0 Tot FAR: 4.0 max Statistics: Height: 60 ft, 5.5 stories Res FAR: 3.41 Parking FAR: 0.10 (not included in Total FAR) FAR: 3.41 Residential: 41 units (affordable) Avg Unit: 971 sf Density: 119 du/a Parking: 52 sp (1.27:1) Project Qualifies for reduced parking standards due to proximity to fixed rail transit. A further reduction in parking standards is possible with a 100% affordable project. Roof 3rd/4th/5th Floors 2nd Floor I Ground Floor I Basement (Bi + B2) Floor Plans 1 .0110 A yolk _gnu Building Section raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CD -C Downtown Zoning Analysis Proposed: 60' Height - 4.0 FAR - i00% Affordable Residential Massing in Context: Statistics: CD -C Downtown Zoning Analysis Parcel Gross Area Acres Standards FAR Mac GSF 20% Landscape/0 Residential Parking Studio 1 BR 2 BR 3 BR Guest Commercial Parking Retail Address 15,000.0 sf 0.34 4.0 60,000.0 sf 3,000.0 sf 56 0.8 0.8 1.6 1.6 0% 0 Notes: Floor Gross Area Retail Net Res Circ/Common Landscape Open Space Studio 1 BR 2 BR 3 8R Total Parking/Mech. Spaces Roof 800.0 800.0 sf 2,150.0 sf 0 units 5 10,208.0 8,558.0 sf 1,650.0 sf 0 2 4 3 9 units 4 10,208.0 8,558.0 sf 1,650.0 sf 0 3 4 2 9 units 3 10,208.0 8,558.0 sf 1,650.0 sf 0 3 4 2 9 units 2 10,208.0 8,558.0 sf 1,650.0 sf 875.0 sf 0 3 4 2 ' 9 units 1 10,987.0 5,587.0 sf 3,900.0 sf 3,575.0 sf 0 1 2 2 ' 5 units 1,500.0 sf 0 81 15,000.0 15,000.0 sf 24 82 13,675.0 15,000.0 sf 28 Totals 81,294sf osf 39,819sf 11,300sf osf 6,600sf 0 12 18 11 41 units 31,500.0sf 52sp 0% 29% 44% 26.83% 29% 71% Summary Stats FAR 3.41 Efficiency 78% OS Standard 50 sf/unit DU/A 119.1 OS Req'd 2,050 sf Units 41 units Parking 52 sp Common Open Space 6,600 sf Avg Unit 971.2 sf Parking Ratio 1.27 Private Open Space TBD Lanscape/OS Req'd 3,000 sf 20% RES FAR 3.41 Parking FAR 0.10 Landscape/OS 6,600 sf COMM FAR 0.00 MOE raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CN ECR Zoning Analysis Site Diagram 372o El Camino Real, Palo Alto CA Parcel Size: 150' x 106' 15,775.8 sf 0.362 acres -3,100 sf Retail 0.2 FAR Zoning Analysis Study 1) Existing Mixed -Use Zoning, 35' Height, 1.0 FAR (0.5 Res. Max) 2) Proposed Mixed -Use Zoning, 4o' Height, 1.5 FAR (1.5 Res. Max) paraffirM raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CN ECR Zoning Analysis Existing Mixed -Use Zoning (3720 ECR) Massing Diagram Existing Standards: Height: 35 ft Res FAR: 0.5 Com FAR: 0.15-0.5 FAR: 1.o max Statistics: Height: 35 ft, 3 stories Res FAR: 0.5 Com FAR: 0.2 (retail) FAR: 0.7 Retail: 3,000 sf Residential: 3 units Avg Unit: 1722 sf Density: 8.3 du/a Res. Parking: 6 sp (2.0:1) +2 sp (guest) Comm. Parking: 15 (1:200sf) Roof 2nd Floor r H X H ist Floor Ground Floor Floor Plans 60 deg daylight plane Building Section Tffiprogill ra i m i + Palo Alto Zoning Analysis 1 11.09.2018 associates CN ECR Zoning Analysis Existing Mixed -Use Zoning (3720 ECR) Massing in Context: Statistics: CN El Camino Real (ECR) Analysis Parcel Gross Area Acres Standards FAR Max GSF 35% landscape Residential Parking Studio 1 BR 2 BR 3 BR Guest Commercial Parking Retail Address 15,755.8 sf 0.36 2.0 31,511.6 sf 5,514.5 sf 7.3 1.25 1.5 2 2 10%+1 15 200 Notes: E.'st r g Retail. 3.100 sf Floor Gross Area Retail Net Res Total Circ/Common Landscape 22.3 Open Space Studio 1 BR 2 BR 3 BR Total Parking/Mech. Spaces 5 0.0 Roof 0.0 3 2,628.0 2 3,865.0 1 5,740.0 B1 0.0 B2 0.0 3,000.0 sf 2,128.0 sf 3,039.0 sf 500.0 sf 826.0 sf 1,215.0 sf 700.0 sf 805.0 sf 1,163.0 sf 2,860.0 sf 432.0 sf 961.0 sf 0 0 1 0 2 0 0 0 units 0 units ' 1 units ' 2 units 0 units 1,525.0 sf 23 Totals 12,233 sf Summary Stats 3,000 sf 5,167 sf 2,541 sf 5,528 sf 1,393 sf 0 0 0% 0% 0% 0 3 0% 100% 100% 3 units 1,525.0 sf Residential Commercial 23 sp 8 1.5 FAR 0.7 DU/A 8.3 Units 3 units Avg Unit 1,722.3 sf RES FAR 0.49 COMM FAR 0.19 Efficiency Parking Parking Ratio Parking FAR 67% 8 sp 2.7 0.10 OS Standard OS Req'd Common Usable OS Private Open Space 20 sf/unit 60 0 1,393 sf TBD ramra raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CN ECR Zoning Analysis Proposed: 40' Height - 1.5 FAR (3720 ECR) Massing Diagram Proposed Standards: Height: 40 ft Res FAR: 1.5 Tot FAR: 1.5 max Statistics: Height: 40 ft, 3 stories Res FAR: 1.25 Comm. FAR: 0.25 Parking FAR: 0.36 (Commercial Parking) FAR: 1.5 Retail: 4,000 sf Residential: 14 units Avg Unit: 1,065 sf Density: 39 du/a Res. Parking: 22 sp (1.6:1) Comm. Parking: 13 (1:200sf, first 1,500 sf exempt) Roof 3rd Floor I H 2nd Floor 1 H Ground Floor Basement Floor Plans 60 deg daylight plane Building Section rOprodil raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 CN ECR Zoning Analysis Proposed: 40' Height - 1.5 FAR (3720 ECR) Massing in Context: Statistics: CN El Camino Real (ECR) Analysis Parcel Gross Area Acres Standards FAR Max GSF 35% Landscape Residential Parking Studio 1 BR 2 BR 3 BR Guest Commercial Parking Retail" Address 15,755.8 sf 0.36 2.0 31,511.6 sf 5,514.5 sf 22 1 1 2 2 0% 12.5 200 Notes: Floor Total 35 "first 1,500 exempt Existing Retail: 3,100 sf Gross Area Retail Net Res Circ/Common Open Space Studio 1 BR 2 BR 3 BR Total Parking/Mech. Spaces Roof 3 2 1 B1 B2 724.0 8,670.0 8,670.0 11,362.0 13,810.0 0.0 4,000.0 sf 7,456.0 sf 7,456.0 sf 724.0 sf 1,214.0 sf 1,214.0 sf 1,760.0 sf 2,750.0 sf 1,566.0 sf 1,217.0 sf 1,130.0 sf 0.0 sf 1,242.0 sf 3 0 3 3 1 r • 3 1 0 0 0 units 7 units 7 units 0 units 5,602.0 sf 13 13,810.0 sf 22 Totals Summary Stats 43,236 sf 4,000 sf 14,912 sf 4,912 sf 5,533 sf 2,372 sf 0 6 0% 43% 43% 6 2 43% 14% 57% 14 units 19,412.0 sf 35 sp Residential 22 Commercial 12 FAR DU/A Units Avg Unit RES FAR COMM FAR 1.5 38.7 14 units 1,065.1 sf 1.26 0.25 Efficiency Parking Parking Ratio Parking FAR 75% 22 sp 1.6 0.36 OS Standard OS Req'd Common Usable OS Private Open Space 150 sf/unit 2,100 sf 2,372 sf TBD raimi+ associates Palo Alto Zoning Analysis 1 11.09.2018 pg 5