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HomeMy WebLinkAbout2022-08-08 City Council Agenda Packet1 City Council Special Meeting Monday, August 8, 2022 5:00 PM Council Chamber & Virtual AMENDED AGENDA Amended agenda items appear in red below. Pursuant to AB 361 Palo Alto City Council meetings will be held as “hybrid” meetings with the option to attend by teleconference/video conference or in person. To maximize public safety while still maintaining transparency and public access, members of the public can choose to participate from home or attend in person. Information on how the public may observe and participate in the meeting is located at the end of the agenda. Masks are strongly encouraged if attending in person. HOW TO PARTICIPATE VIRTUAL PARTICIPATION CLICK HERE TO JOIN (https://cityofpaloalto.zoom.us/j/362027238) Meeting ID: 362 027 238 Phone:1(669)900-6833 The meeting will be broadcast on Cable TV Channel 26, live on YouTube at https://www.youtube.com/c/cityofpaloalto, and streamed to Midpen Media Center at https://midpenmedia.org. TIME ESTIMATES Time estimates are provided as part of the Council's effort to manage its time at Council meetings. Listed times are estimates only and are subject to change at any time, including while the meeting is in progress. The Council reserves the right to use more or less time on any item, to change the order of items and/or to continue items to another meeting. Particular items may be heard before or after the time estimated on the agenda. This may occur in order to best manage the time at a meeting or to adapt to the participation of the public. REVISED PUBLIC COMMENTS Public Comments will be accepted both in person and via Zoom for up to three minutes or an amount of time determined by the Chair. All requests to speak will be taken until 5 minutes after the staff’s presentation. Written public comments can be submitted in advance to city.council@cityofpaloalto.org and will be provided to the Council and available for inspection on the City’s website. Please clearly indicate which agenda item you are referencing in your email subject line. PowerPoints, videos, or other media to be presented during public comment are accepted only by email to city.clerk@cityofpaloalto.org at least 24 hours prior to the meeting. Once received, the City Clerk will have them shared at public comment for the specified item. To uphold strong cybersecurity management practices, USB’s or other physical electronic storage devices are not accepted. 2 Special Meeting August 8, 2022 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. CALL TO ORDER SPECIAL ORDERS OF THE DAY (5:00 PM – 5:25 PM) 1.Appreciation for State Senator Josh Becker for Securing $2 million for Newell Bridge Replacement Project 2.Select Applicants to Interview for the Human Relations Commission AA1. Sibling City Update from Mayor John Hamilton, Bloomington, Indiana AGENDA CHANGES, ADDITIONS AND DELETIONS PUBLIC COMMENT (5:25 – 5:45 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 (5:45 – 5:50 PM) Items will be voted on in one motion unless removed from the calendar by three Council Members. 3.Adoption of a Resolution Establishing FY 2023 Property Tax Levy for General Obligation Bonds (Measure N Libraries) 4.Approval of the Rail Committee Charter and Workplan for 2022-23 CITY MANAGER COMMENTS (5:50 – 6:10 PM) ACTION ITEMS Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. 5.Approval of Appointment and Employment Agreement with Andrew Binder as Chief of Police (6:10 – 6:45 PM) 6.Adoption of an Ordinance Approving the Police Department's Military Equipment Use Policy Under AB 481 Continued to a future meeting AA2. Adoption of Resolutions: (1) Placing a Business Tax on the November 2022 Ballot; (2) Placing a Measure Affirming the Natural Gas Utility Transfer on the November 2022 Ballot; and (3) Establishing Advisory Spending Guidelines for Business Tax Proceeds (6:45 PM – 8:15 PM). Supplemental Information Added. AA3. PUBLIC HEARING / QUASI-JUDICIAL. 1033 Amarillo Ave [22PLN- 00016]: Request for a Preliminary Parcel Map With Exceptions to Subdivide a 20,787 Square Foot R-1 Property Into Two (2) Lots, Where Lot 1 Will be 10,668.50 Square Feet and Lot 2 Will be 10,118.77 Square Feet. Exception is for Minimum lot Width and Q&A Q&A Public Letters Public Letters Presentation Presentation 3 Special Meeting August 8, 2022 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. Maximum lot Size. Zoning District R-1 Single Family Residential. (8:15 – 9:30 PM). Supplemental Information Added. 7.Discuss and Provide Comments on the City's Draft Comment letter to the California High Speed Rail Authority (CHSRA) and Authorize the Mayor to Send a Comment Letter to the CHSRA on the Final Environmental Impact Report/Environmental Impact Statement (EIR/EIS) for the California High Speed Rail segment between San Francisco and San Jose, Which Traverses Palo Alto. (9:30 – 10:15 PM) 8.Designation of Voting Delegate and Alternate for the League of California Cities Annual 2022 Conference, to be held September 7-9 in Long Beach, CA Continued to August 15, 2022 COUNCIL MEMBER QUESTIONS, COMMENTS, ANNOUNCEMENTS Members of the public may not speak to the item(s) ADJOURNMENT INFORMATION REPORTS Information reports are provided for informational purposes only to the Council and the public but are not listed for action during this meeting’s agenda. 8.Investment Activity Report for the Fourth Quarter, Fiscal Year 2022 9.Fiscal Year 2022 Annual Evaluation Report for the Santa Clara County Multi-Jurisdictional Program for Public Information on Flood Preparedness and Awareness, and the Resulting Community Rating System Flood Insurance Discounts 10.City Council Recess Report OTHER INFORMATION Standing Committee Meetings Policy & Services Committee Meeting August 9, 2022 - Canceled Public Comment Letters Schedule of Meetings 4 Special Meeting August 8, 2022 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. AMENDED AGENDA ITEMS Items that have been added/modified from the original publication of the agenda are listed below. Any corresponding materials are appended to the end of the initial packet. If full items have been added to the Agenda, they will be denoted with a number staring with AA, meaning Amended Agenda item. 6.Adoption of an Ordinance Approving the Police Department's Military Equipment Use Policy Under AB 481 Continued to a future meeting 8.Designation of Voting Delegate and Alternate for the League of California Cities Annual 2022 Conference, to be held September 7-9 in Long Beach, CA Continued to August 15, 2022 AA1. Sibling City Update from Mayor John Hamilton, Bloomington, Indiana AA2. Adoption of Resolutions: (1) Placing a Business Tax on the November 2022 Ballot; (2) Placing a Measure Affirming the Natural Gas Utility Transfer on the November 2022 Ballot; and (3) Establishing Advisory Spending Guidelines for Business Tax Proceeds (Continued from 8/1/22). Supplemental Information Added. AA3. PUBLIC HEARING / QUASI-JUDICIAL. 1033 Amarillo Ave [22PLN- 00016]: Request for a Preliminary Parcel Map With Exceptions to Subdivide a 20,787 Square Foot R-1 Property Into Two (2) Lots, Where Lot 1 Will be 10,668.50 Square Feet and Lot 2 Will be 10,118.77 Square Feet. Exception is for Minimum lot Width and Maximum lot Size. Zoning District R-1 Single Family Residential. (Continued from 8/1/22). Supplemental Information Added. AA4. PUBLIC HEARING: Adoption of a Resolution Confirming the Weed Abatement Report and Ordering the Cost of Abatement to be a Special Assessment on the Respective Properties Described Therein This item has been continued and will be re-noticed for a future meeting. 5 Special Meeting August 8, 2022 Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection at www.CityofPaloAlto.org. PUBLIC COMMENT INSTRUCTIONS Members of the Public may provide public comments to teleconference meetings via email, teleconference, or by phone. 1.Written public comments may be submitted by email to city.council@cityofpaloalto.org. 2.Spoken public comments using a computer will be accepted through the teleconference meeting. To address the Council, click on the link below to access a Zoom-based meeting. Please read the following instructions carefully. A.You may download the Zoom client or connect to the meeting in- browser. If using your browser, make sure you are using a current, up-to-date browser: Chrome 30+, Firefox 27+, Microsoft Edge 12+, Safari 7+. Certain functionality may be disabled in older browsers including Internet Explorer. B.You may be asked to enter an email address and name. We request that you identify yourself by name as this will be visible online and will be used to notify you that it is your turn to speak. C.When you wish to speak on an Agenda Item, click on “raise hand.” The Clerk will activate and unmute speakers in turn. Speakers will be notified shortly before they are called to speak. D.When called, please limit your remarks to the time limit allotted. E.A timer will be shown on the computer to help keep track of your comments. 3.Spoken public comments using a smart phone will be accepted through the teleconference meeting. To address the Council, download the Zoom application onto your phone from the Apple App Store or Google Play Store and enter the Meeting ID below. Please follow the instructions B-E above. 4.Spoken public comments using a phone use the telephone number listed below. When you wish to speak on an agenda item hit *9 on your phone so we know that you wish to speak. You will be asked to provide your first and last name before addressing the Council. You will be advised how long you have to speak. When called please limit your remarks to the agenda item and time limit allotted. CLICK HERE TO JOIN Meeting ID: 362 027 238 Phone:1(669)900-6833 City of Palo Alto (ID # 14621) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Special Orders of the Day City of Palo Alto Page 1 Title: Appreciation for State Senator Josh Becker for Securing $2 million for Newell Bridge Replacement Project From: City Manager Lead Department: City Manager This item has no written report. 1 Packet Pg. 5 City of Palo Alto (ID # 14579) Office of the City Clerk City Council CAO Report Meeting Date: 8/8/2022 Report Type: Special Orders of the Day Title: Select Applicants to Interview for the Human Relations Commission From: Lesley Milton, City Clerk Recommendation Direct Staff to schedule interviews with selected applicants for one vacancy on the Human Relations Commission. Discussion Boards and Commissions are established as advisory bodies to the City Council, made up of community volunteers that provide essential feedback on matters of importance to the community. The City Clerk’s office advertises and recruits for vacancies, the Council considers the applications, interviews desired candidates, and makes recommendations for appointment for the open positions. Commissioner Patti Regehr resigned from the Human Relations Commission on May 31, 2022. As such, the current vacancy staff is requesting to be filled is: • One (1) position on the Human Relations Commission, with term expiring March 31, 2023 A total of 6 applications have been submitted during the recruitment period. Scheduling Interviews During the last several recruitments, the City Council has elected to interview all qualified applicants for respective Boards and Commissions. It is at the discretion of the Council to determine if they wish to continue the past practice, interview all candidates, or identify and provide direction on a select cohort of applicants to continue to the interview processes. Interviews of the selected applicants will be scheduled for a future Special City Council meeting date to be determined. 2 Packet Pg. 6 Page 2 Membership Requirements Per PAMC 2.22.010, The Human Relations Commission requires each member of the commission to have Palo Alto residency. Human Relations Commission: One position Term ending March 31, 2023 • Palo Alto Residency • APPLICANTS: 1. Donald Barr 2. Katie Causey 3. Sunita de Tourreil 4. Tracy Alejandra Navichoque 5. Chitra Sharma 6. Kat Snyder Public Outreach Palo Alto Municipal Code 2.16.060 requires public notification regarding vacancies of the Commissions as follows, “The City Clerk shall exercise their discretion in choosing the method of advertisement that will most effectively reach potential candidates.” Based on the September 14, 2021 Policy & Services Committee meeting report (available here) regarding Board and Commission Member demographics and community representation the City Clerk’s office expanded recruitment efforts through additional means to “most effectively reach potential candidates”. The Human Relations Commission special recruitment invited applications from June 10, 2022 through July 27, 2022 through the new online application process. The vacancy was advertised through various methods in partnership with the Communications team. This included paid and digital print advertisements in the Daily Post and Palo Alto Weekly; via the City’s website and social media channels; in physical locations of the Palo A lto Libraries and Community Centers; and distributed by e-mail and through the City subscription-based notification lists. ATTACHMENTS: • Attachment2.a: HRC - All Applications_Redacted (PDF) 2 Packet Pg. 7 Human Relations Commission Application Submission date:15 July 2022, 1:40PM Receipt number:8 Related form version:3 Personal Information Name Donald Barr Address City Postal Code Cell Phone Number Home Phone Number Email Address Are you a Palo Alto resident?Yes Do you have any relatives or members of your household who are employed by the City of Palo Alto, who are currently serving on the City Council, or who are Commissioners or Board Members? No Are you available and committed to complete the term applied for? Yes 1 of 7 2.a Packet Pg. 8 Fair Political Practices California state law requires board/commission members to file a disclosure of financial interests (Fair Political Practices Commission, Conflict of Interest, Form 700). Do you/your spouse have an investment in, or do you or your spouse serve as an officer or director of, a company doing business in Palo Alto which you believe is likely to: 1. Engage in business with the City; 2. Provide products or services for City projects; or 3. Be affected by decisions of this Board or Commission? No Excluding your principal residence, do you or your spouse own real property in Palo Alto? No How did you learn about the vacancy on the Human Relations Commission? City Website Consent to Publish Personal Information on the City of Palo Alto Website Read the code, and check only ONE option below:I give permission for the City of Palo Alto to post to the City’s website the attached Board and Commission Application intact. I have read and understand my rights under Government Code Section 6254.21. I may revoke this permission at any time by providing written notice to the Palo Alto City Clerk. Alternate Contact Information - Address Alternate Contact Information - Phone Number Alternate Contact Information - Email 2 of 7 2.a Packet Pg. 9 Personal and Job Experience Please list your relevant education, training, experience, certificates of training, licenses, and professional registration. (621 characters max) MD - University of California, San Francisco 1973 PhD - Sociology, Stanford University 1993 Licensed physician in California, 1974 - present Faculty, Stanford University, 1993 - present, teaching courses on U.S. Health Care Policy and on Racial and Social Inequality in Health. Employment Information Company/Employer Name Stanford University Occupation Professor of Pediatrics, and of Education (by courtesy) Is your Company/Employer your current one or last?Current Employer Please describe your involvement in community activities, volunteer and civic organizations, including dates and any offices held. (1242 characters max) For more than 2 decades I have been involved in developing affordable housing in Palo Alto and in providing services to the homeless. I founded the Community Working Group and led the non-profit organization in the development of the Opportunity Center in Palo Alto, which provides housing, social services, and medical care to the homeless. I also led the organization's effort in developing the affordable housing facility at 801 Alma in Palo Alto. I served on the Board of the organization for more than 10 years. I founded the nonprofit organization that is now the Peninsula Healthcare Connection (PHC), and currently serve as Board Secretary. PHC is a federally certified (lookalike) health clinic that provides medical services and social services support to the currently homeless and to the formerly homeless who have been placed in housing. For the past year I have also served on the Board of Directors of Avenidas, the senior services agency in Palo Alto. I have also worked for more than two decades at Stanford to reduce racial inequalities in access to medical school. With my support, a substantial number of former Stanford students from under-represented racial minorities have become successful health care professionals. 3 of 7 2.a Packet Pg. 10 Application Questions 1. W hy are you interested in serving on the Human Relations Commission and what experience would you bring to the position? (1518 characters max) The Palo Alto community is facing a number of challenges, some as a result of the pandemic and some unrelated to the pandemic. Seniors – those age 65 or older – are one of the groups most affected by these challenges. As a member of the Board of Directors of Avenidas, I have committed to addressing the personal and social needs of seniors in Palo Alto. Issues such as social isolation as a result of the pandemic and rising costs of housing have impacted the lives of a number of senior residents of Palo Alto. As a member of the HRC I would work both to learn about and to address these issues. As I have also been working for many years to support the homeless population in our community, I would also address the needs of this population as a Commissioner. As a member of the HRC I would build on my experience addressing the needs of seniors and of the homeless to work to understand and to support the needs of all members of our community, with a focus on the needs of socially and economically disadvantaged populations. 4 of 7 2.a Packet Pg. 11 2. Please describe an issue that recently came before the Commission that is of particular interest to you and describe why you are interested in it. (1449 characters max) Archived video meetings are available from the Midpen Media Center. As part of the May 24 meeting, the HRC established a series of “ad hoc sub-committees” to address issues that are part of the 2022-23 HRC Work Plan. I note that the membership of the sub-committee on “Housing/Homelessness – Advocacy” was “TBD”, which I take to mean to be determined. As a Commissioner, I would hope to play a role in this important public health issue. Through my work in support of the homeless, I am aware that there are a number of groups in the population we consider homeless or at risk of becoming homeless. These include the recently housed, the unhoused who come to the Opportunity Center for services, and the unhoused who remain isolated and do not seek services. It is important to learn more about these populations through collaboration with both County agencies and community organizations that focus on the needs of these populations. I also note that, in identifying the issues to be addressed by the HRC ad-hoc committees, the social and economic needs of the population of seniors in our community were not included. I would advocate to establish an ad-hoc committee to assess and address the needs of seniors. In this role I would work to collaborate with Avenidas in addressing this issue. 5 of 7 2.a Packet Pg. 12 3. If you are appointed, what specific goals would you like to see the Human Relations Commission achieve, and how would you help in the process? (1656 characters max) As I have indicated in my response to the earlier questions, I would like the HRC to focus on understanding and supporting the needs of seniors and of the homeless. A key step in this process would be to gather data from other governmental agencies and from community groups on the social, economic, and health care needs of these groups. The Commission can then suggest to the City Council and the City government steps that might be taken to address these needs. As an additional goal, I would encourage the HRC to address the needs of another group in our community: workers in the retail and service sectors of our community. It would be important to learn about the typical wages and income of these workers, and where their income places these workers on the spectrum of housing affordability (e.g., moderate-income, low-income, very-low-income). As the City Council continues to consider options for expanding housing in our community, including the housing needs of workers will be essential. The HRC could play a central role in this process. 4. Human Relations Commission Members work with the documents listed below. If you have experience with any of these documents, please describe that experience. Experience with these documents is not required for selection. (690 characters max) Human Services Needs Assessment (2020) Muni Code 9.72 – Mandatory Response Program Community Services Element of the Comprehensive Plan (2017) I have no personal experience with any of these documents. As a member of HRC, I would read each of these documents to learn about the issues they address. If you'd like to provide any additional documents, please upload below. Tall Tree-2006.pdf 6 of 7 2.a Packet Pg. 13 Please confirm that you have read the Boards and Commissions Handbook. View the Boards and Commissions Handbook. Yes Signature Name of signatory: Donald A Barr Link to signature Date Completed 07/15/2022 7 of 7 2.a Packet Pg. 14 Select FILE --> PRINT to print this story. News - Wednesday, February 1, 2006 Education, housing activists win 'Tall Tree' awards Honors planned for Barbara Spreng, Donald Barr, Children's Health Council, Lockheed Martin Advanced Technology Center by Jay Thorwaldson School-leadership activist Barbara Spreng and advocate for the homeless Donald Barr, M.D., have been named 2006 recipients of the Tall Tree Award by the Palo Alto Chamber of Commerce. The Children's Health Council has been cited as outstanding non -profit organization and the Palo Alto-based Lockheed Martin Advanced Technology Center as outstanding business, due to its support for community programs. The awards will be presented Wednesday, April 5, at the 26 th annual Tall Tree Awards dinner, this year at the Crowne Plaza Cabana hotel in Palo Alto. Spreng will receive the award for "outstanding volunteer" for her years of work on behalf of Palo Alto schools, including key roles in raising funds, and for her community and education work generally. The array of organizations for which she has worked include the Palo Alto Council of PTAs (PTAC), Palo Alto Foundation for Education, Adolescent Counseling Service - she served terms as board president of all three organizations. She also has been active with Palo Altans for Government Effectiveness, Leadership Midpeninsula, the Foundation for a College Education and others. "Barbara personifies the meaning of 'outstanding volunteer,'" Mayor Judy Kleinberg said in a nomination letter. "She has unselfishly, and with little recognition, devoted her talents and time to a broad cross-section of organizations committed to improving the quality of life for children and families in Palo Alto." Spreng also has worked as a child advocate for Kids in Common, a Silicon Valley children's advocacy organization, where she helped create an immunization program for underprivileged children in the region. Nancy Shepherd, another former PTAC president, noted that "Few presidents have ever served during a parcel-tax campaign, let alone two in one year! Her service leadership style contributed directly (to) the development and final success of these campaigns." Dr. Barr, named "outstanding professional," was founding president of the Community Working Group on Homeless Services beginning in 1998 after a flood shut down a small drop -in center. He spearheaded the creation of the Opportunity Center, now under construction on Encina Avenue between the Palo Alto Medical Foundation and Town & Country Village Shopping Center. "Don's devotion to responding creatively, in this very tangible way, to the problem of homelessness in our community is unprecedented," the Rev. Jeffrey Vamos of the Community Working Group board - which nominated Dr. Barr - said of his leadership. "Don has been the key factor in the creation of this $24 million facility," which will be "a lasting legacy to our whole community," the Rev. Vamos said. He noted that Dr. Barr has performed without pay the duties of a CEO in the complex, often challenging development of the center. "He has performed this service in addition to his duties as a professor of sociology at Stanford - where he has also received the Dinkelspiel Award for his outstanding work - and his work as a practicing physician at the Palo Alto Medical Foundation," he said. The Children's Health Council, for just over a half century, has provided diagnostic, treatment and counseling services for children and families facing the challenges of learning disabilities and emotional and speech problems, ranging from autism to dyslexia, depression to hyperactivity disorders. It also operates the Esther B. Clark School for young persons aged 7 to 17 who are unable to function in public or private school systems, typically transitioning them back into regular schools within a year or two. The school is named for the late Esther Clark, one of the first women pediatricians on the Peninsula and an early partner with the Palo Alto Medical Clinic. The CHC was initially founded to address needs of children stricken with polio, but evolved to include a range of complex medical problems and their side effects. 2.a Packet Pg. 15 The Lockheed Martin Advanced Technology Center (ATC), in the Stanford Research Park, is comprised of more than 700 persons engaged for the past half century in research and development for Lockheed Martin Space Systems. The ATC community activities have included being a founding community leader in "Palo Alto Green," the city-wide effort to create a more sustainable environment through use of renewable energy. The company executed the first renewable power purchase nationally by a leading defense and aerospace contractor. The firm has donated to scores of local and regional organizations, directly and through an employee -giving program. In the past year, it has contributed to Habitat for Humanity, Committee for Green Foothills, Community School for Music and Arts, Resource Area for Teachers, the Marine Science Center, Camp Anytown, Junior Achievement, Teach for America, the Arts Council of Silicon Valley and the California League of Conservation Voters - in addition to other programs. Editor Jay Thorwaldson can be reached at jthorwaldson@paweekly.com. Find this article at: http://www.paloaltoonline.com/weekly/story.php ?story_id=132 2.a Packet Pg. 16 Human Relations Commission Application Submission date:14 June 2022, 10:54PM Receipt number:4 Related form version:3 Personal Information Name Katie Causey Address City Postal Code Cell Phone Number Home Phone Number Email Address Are you a Palo Alto resident?Yes Do you have any relatives or members of your household who are employed by the City of Palo Alto, who are currently serving on the City Council, or who are Commissioners or Board Members? No Are you available and committed to complete the term applied for? Yes 1 of 7 2.a Packet Pg. 17 Fair Political Practices California state law requires board/commission members to file a disclosure of financial interests (Fair Political Practices Commission, Conflict of Interest, Form 700). Do you/your spouse have an investment in, or do you or your spouse serve as an officer or director of, a company doing business in Palo Alto which you believe is likely to: 1. Engage in business with the City; 2. Provide products or services for City projects; or 3. Be affected by decisions of this Board or Commission? No Excluding your principal residence, do you or your spouse own real property in Palo Alto? No How did you learn about the vacancy on the Human Relations Commission? Email from the City Consent to Publish Personal Information on the City of Palo Alto Website Read the code, and check only ONE option below:I request that the City of Palo Alto redact my home address, phone numbers, and email address from the attached Board and Commission Application prior to posting to the City’s website. I am providing the following alternate information and request that the following contact information below: Alternate Contact Information - Address Alternate Contact Information - Phone Number Alternate Contact Information - Email Personal and Job Experience 2 of 7 2.a Packet Pg. 18 Please list your relevant education, training, experience, certificates of training, licenses, and professional registration. (621 characters max) I was born and raised in Palo Alto where I have lived my entire life I attended PAUSD for my entire K-12 education I graduated from the George Washington University in 2017 with a Bachelor’s in Women’s Studies where my program primarily focused on looking at community issues and different approaches to resolve them (for example: addressing discrimination, harrassment, intersectional approaches resolving conflict between communites with complex history between eachother, etc.). Employment Information Company/Employer Name Palo Alto Forward Occupation Community Engagement Manager Is your Company/Employer your current one or last?Current Employer 3 of 7 2.a Packet Pg. 19 Please describe your involvement in community activities, volunteer and civic organizations, including dates and any offices held. (1242 characters max) I’ve been a member of the American Association of University Women since 2017 and have been hired as community advocate for them to speak on issues such as addressing sexual harassment in schools. In 2019 I assisted the Palo Alto Recreation Foundation with their fundraising and community outreach. Since I was a teenager I have actively volunteered in Palo Alto and the Bay Area. Between 2019 - 2020 I served on the Fund Development Council for the Junior League of San Francisco which supports a variety of programs in the Bay Area including those used in Palo Alto. I was also awarded by them for my volunteer work in the community and my leadership. I’ve worked on a variety of local campaigns and in 2020 ran for PAUSD Board of Education. From the end of 2021 until last month I worked as an Organizer for the Palo Alto Renters’ Association primarily helping tenants in Palo Alto facing eviction during the pandemic. I am currently a student completing the necessary coursework to become eligible for a Master’s in Bioengineering. Between 2018 - 2020 I served as Chair for the League of Women Voters Palo Alto Committee to End Gun Violence, I also supported their Climate Change Committee. Application Questions 4 of 7 2.a Packet Pg. 20 1. W hy are you interested in serving on the Human Relations Commission and what experience would you bring to the position? (1518 characters max) I've been interested in serving on the Human Relations Commission the last several years, as I stated before my undergraduate degree was in Women's Studies and how my program worked was we would look at the history of different communities and identities, and each week we would get an example based on a real case of an issue in a community (mediating a conflict, discrimination, harassment, etc.) and we would discuss the different interest groups and perspectives involved, and how to solve the issue from both a lens of community action and also policy change. I've brought that perspective to a work with a variety of nonprofits in the area and I've heavily volunteered in the community since I was a teenager. The Human Relations Commission covers a very broad range of subjects I'm highly interested in. I also can say from running for office I know how to be open and seek feedback from a wide range of community members in Palo Alto. I'm also a young LGBT+ women someone who grew up in this community and I currently balance multiple jobs and being a student, a huge reason I haven't applied to this commission sooner is a 4 year unpaid position is a big commitment, but this was the perfect timing of I know I can commit to the next 9 months. 5 of 7 2.a Packet Pg. 21 2. Please describe an issue that recently came before the Commission that is of particular interest to you and describe why you are interested in it. (1449 characters max) Archived video meetings are available from the Midpen Media Center. As an Organizer at the Palo Alto Renters' Association I met with members of the Human Relations Commission to give feedback on the impact of renters protections in Palo Alto based on my last 6 months of working with tenants. While there's a very wide range of subjects the Human Relations Commission covers that I am interested in, housing is such a critical issue and evictions are happening now. As someone who grew up here working as an organizer, the impact of evictions are horrific they rip our community apart I've seen first hand what happens in Palo Alto when someone faces eviction whether their a single parent just trying to keep their kid in the local schools or they're elderly on social security and have lived in this community for decades. 3. If you are appointed, what specific goals would you like to see the Human Relations Commission achieve, and how would you help in the process? (1656 characters max) While this appointment is only for 8-9 months I would love to help the Human Relations Commission in any manner possible in furthering their work to support independent investigation of the hate crimes that have occurred the last several years, as their occurrence has been deeply unsettling. If this was 9 months where we had an unlimited amount of time and resources I would love to work to further support our LGBT+ youth in Palo Alto whether through a pride celebration or youth community resources. 6 of 7 2.a Packet Pg. 22 4. Human Relations Commission Members work with the documents listed below. If you have experience with any of these documents, please describe that experience. Experience with these documents is not required for selection. (690 characters max) Human Services Needs Assessment (2020) Muni Code 9.72 – Mandatory Response Program Community Services Element of the Comprehensive Plan (2017) NA If you'd like to provide any additional documents, please upload below. Please confirm that you have read the Boards and Commissions Handbook. View the Boards and Commissions Handbook. Yes Signature Name of signatory: Katie Causey Link to signature Date Completed 06/14/2022 7 of 7 2.a Packet Pg. 23 Human Relations Commission Application Submission date:13 June 2022, 8:57PM Receipt number:3 Related form version:3 Personal Information Name Sunita de Tourreil Address City Postal Code Cell Phone Number Home Phone Number Email Address Are you a Palo Alto resident?Yes Do you have any relatives or members of your household who are employed by the City of Palo Alto, who are currently serving on the City Council, or who are Commissioners or Board Members? No Are you available and committed to complete the term applied for? Yes 1 of 5 2.a Packet Pg. 24 Fair Political Practices California state law requires board/commission members to file a disclosure of financial interests (Fair Political Practices Commission, Conflict of Interest, Form 700). Do you/your spouse have an investment in, or do you or your spouse serve as an officer or director of, a company doing business in Palo Alto which you believe is likely to: 1. Engage in business with the City; 2. Provide products or services for City projects; or 3. Be affected by decisions of this Board or Commission? No Excluding your principal residence, do you or your spouse own real property in Palo Alto? No How did you learn about the vacancy on the Human Relations Commission? Email from the City Consent to Publish Personal Information on the City of Palo Alto Website Read the code, and check only ONE option below:I request that the City of Palo Alto redact my home address, phone numbers, and email address from the attached Board and Commission Application prior to posting to the City’s website. I am providing the following alternate information and request that the following contact information below: Alternate Contact Information - Address City Hall HRC contact address (my home address should not be listed) Alternate Contact Information - Phone Number 650-796-5287 Alternate Contact Information - Email sunita@chocolatedividends.org 2 of 5 2.a Packet Pg. 25 Personal and Job Experience Please list your relevant education, training, experience, certificates of training, licenses, and professional registration. (621 characters max) I have a graduate degree in Science, worked in medical research for many years, became an entrepreneur and have my own business for nearly 20 years. I served on the HRC for a partial term, like the one I am applying for, I trained to be a Court Appointed Special Advocate in the early 2000s, for children in the foster system. Employment Information Company/Employer Name Happy Chocolate Experiences, LLC Occupation entrepreneur Is your Company/Employer your current one or last?Current Employer Please describe your involvement in community activities, volunteer and civic organizations, including dates and any offices held. (1242 characters max) HRC Fall 2020-Spring 2021 Palo Alto Girls Softball Assistant and Head Coach Application Questions 1. W hy are you interested in serving on the Human Relations Commission and what experience would you bring to the position? (1518 characters max) I served a partial term in 2020-2021, and I learned a lot about how the organization works, the kind of grant work we do, and how we can make sure all voices are heard. I am interested in serving again, because it is my main way to engage and do my civic duty, as I am not a citizen of this country (by choice) and yet I feel I owe my community my engagement, and it deserves alternate points of view that come from being raised in another country, with parents who were nationals of yet two other countries. 3 of 5 2.a Packet Pg. 26 2. Please describe an issue that recently came before the Commission that is of particular interest to you and describe why you are interested in it. (1449 characters max) Archived video meetings are available from the Midpen Media Center. I remain interested in all issues relating to bringing compassion and kindness to all of our neighbors. An ongoing issue that remains on my radar, is to do with the unhoused, the cost of housing and ensuring that post-Covid we are able to enable folks who are struggling to be able to have the support needed to be able to keep finding more opportunity, not less. 3. If you are appointed, what specific goals would you like to see the Human Relations Commission achieve, and how would you help in the process? (1656 characters max) I believe that a national reckoning is necessary and underway, to rectify inequities and economic and racial injustices, and Palo Alto needs to do its part. It's leaders and our community have a responsibility to see where we have historically fallen short, and continue to fall short, and take an honest and humble look at how our systems (housing, policing, parks and recreation) are not serving all. We must be the innovative leader, showing how we take Silicon Valley principles and apply them to community problems. We are leaders at thinking outside of the box, and daring greatly. We can do this with more than tech, we can also lead the way in fostering a more inclusive and welcoming community that is a tight knit group of folks who are stronger together. We can show that inclusion leads to so much more than the sum of its parts. None of this needs to be a pure sacrifice, we can all grow and be better by being better together. 4 of 5 2.a Packet Pg. 27 4. Human Relations Commission Members work with the documents listed below. If you have experience with any of these documents, please describe that experience. Experience with these documents is not required for selection. (690 characters max) Human Services Needs Assessment (2020) Muni Code 9.72 – Mandatory Response Program Community Services Element of the Comprehensive Plan (2017) I believe I worked with the Human Services Needs Assessment and some other guidelines used for doing the CBDG grants and helping with the granting of emergency funds. If you'd like to provide any additional documents, please upload below. Please confirm that you have read the Boards and Commissions Handbook. View the Boards and Commissions Handbook. Yes Signature Name of signatory: Sunita de Tourreil Link to signature Date Completed 06/13/2022 5 of 5 2.a Packet Pg. 28 Human Relations Commission Application Submission date:26 July 2022, 3:46PM Receipt number:12 Related form version:3 Personal Information Name Tracy Alejandra Navichoque Address City Postal Code Cell Phone Number Home Phone Number Email Address Are you a Palo Alto resident?Yes Do you have any relatives or members of your household who are employed by the City of Palo Alto, who are currently serving on the City Council, or who are Commissioners or Board Members? No Are you available and committed to complete the term applied for? Yes 1 of 6 2.a Packet Pg. 29 Fair Political Practices California state law requires board/commission members to file a disclosure of financial interests (Fair Political Practices Commission, Conflict of Interest, Form 700). Do you/your spouse have an investment in, or do you or your spouse serve as an officer or director of, a company doing business in Palo Alto which you believe is likely to: 1. Engage in business with the City; 2. Provide products or services for City projects; or 3. Be affected by decisions of this Board or Commission? No Excluding your principal residence, do you or your spouse own real property in Palo Alto? No How did you learn about the vacancy on the Human Relations Commission? City Website Consent to Publish Personal Information on the City of Palo Alto Website Read the code, and check only ONE option below:I request that the City of Palo Alto redact my home address, phone numbers, and email address from the attached Board and Commission Application prior to posting to the City’s website. I am providing the following alternate information and request that the following contact information below: Alternate Contact Information - Address Alternate Contact Information - Phone Number Alternate Contact Information - Email Personal and Job Experience 2 of 6 2.a Packet Pg. 30 Please list your relevant education, training, experience, certificates of training, licenses, and professional registration. (621 characters max) Bachelors Degree in History from Northwestern University Master's Degree in Public Diplomacy from USC Employment Information Company/Employer Name Stanford University Occupation Program Manager Is your Company/Employer your current one or last?Current Employer Please describe your involvement in community activities, volunteer and civic organizations, including dates and any offices held. (1242 characters max) Volunteer at the Boys and Girls Club of the Peninsula Application Questions 3 of 6 2.a Packet Pg. 31 1. W hy are you interested in serving on the Human Relations Commission and what experience would you bring to the position? (1518 characters max) Although I have only lived in Palo Alto since January of 2020, I am keen to serve and contribute to my community. As a first generation American who first learned to speak Spanish, I have constantly seeking ways to make equity a priority for all, especially when it comes to language and translation. My current work revolves around human rights and ensuring that our right to privacy and free expression are protected in digital spaces. I would like to contribute my fresh perspective and dedication equality. Most of my work in this space has been through volunteer positions but I would like to complement that work with discussions about policy. I am currently a program manager at Stanford and can bring organizational, management, and analyst skills to the commission. I have also lived and worked abroad (Turkey, Uruguay, and Guatemala) so I am willing seeking to integrate worldly perspectives. In the past, I served as an education manager for the Los Angeles World Affairs Council and also as an arts educators for several art museums, where I was tasked with focusing on integration and equity for all demographics and learning abilities. 2. Please describe an issue that recently came before the Commission that is of particular interest to you and describe why you are interested in it. (1449 characters max) Archived video meetings are available from the Midpen Media Center. I would like to work and learn about all topics but am keen on contributing to the reduction of hate speech in our communities. I am particularly interested in this topic because my employment explicitly deals with the nuances of freedom of speech and considers the negative impacts of hateful discriminatory speech and its adverse effects on communities. This topic was explicitly debated during the March 10, 2022 meeting. I would also like to work on human rights specific projects. 4 of 6 2.a Packet Pg. 32 3. If you are appointed, what specific goals would you like to see the Human Relations Commission achieve, and how would you help in the process? (1656 characters max) My goal is to ensure that all persons can participate equally. Moreover, I would like to contribute to the promotion of community awareness and understanding. The pandemic has isolates us greatly. As a relatively new community member, I would like to sponsor more neighbor initiatives so that we can interact with one another. My goal is to oil the wheels of conversation. When we speak to one another, we can put in place a better practice of listening! When we listen, we can better understand one another. I would also like to use the robust park system in Palo Alto as a medium through which we can apply some of the commission's laudable goals. Secondly, I live next to two elderly neighbors. While I help day to day with groceries and some digital literacy, I would like to consider policies that could assist our aging neighbors at a city wide level. 4. Human Relations Commission Members work with the documents listed below. If you have experience with any of these documents, please describe that experience. Experience with these documents is not required for selection. (690 characters max) Human Services Needs Assessment (2020) Muni Code 9.72 – Mandatory Response Program Community Services Element of the Comprehensive Plan (2017) None at the moment but willing and able to learn and engage. If you'd like to provide any additional documents, please upload below. Please confirm that you have read the Boards and Commissions Handbook. View the Boards and Commissions Handbook. Yes 5 of 6 2.a Packet Pg. 33 Signature Name of signatory: Tracy Navichoque Link to signature Date Completed 07/26/2022 6 of 6 2.a Packet Pg. 34 Human Relations Commission Application Submission date:17 June 2022, 5:43AM Receipt number:6 Related form version:3 Personal Information Name chitra sharma Address City Postal Code Cell Phone Number Home Phone Number Email Address Are you a Palo Alto resident?Yes Do you have any relatives or members of your household who are employed by the City of Palo Alto, who are currently serving on the City Council, or who are Commissioners or Board Members? No Are you available and committed to complete the term applied for? Yes 1 of 5 2.a Packet Pg. 35 Fair Political Practices California state law requires board/commission members to file a disclosure of financial interests (Fair Political Practices Commission, Conflict of Interest, Form 700). Do you/your spouse have an investment in, or do you or your spouse serve as an officer or director of, a company doing business in Palo Alto which you believe is likely to: 1. Engage in business with the City; 2. Provide products or services for City projects; or 3. Be affected by decisions of this Board or Commission? No Excluding your principal residence, do you or your spouse own real property in Palo Alto? No How did you learn about the vacancy on the Human Relations Commission? City Website Consent to Publish Personal Information on the City of Palo Alto Website Read the code, and check only ONE option below:I give permission for the City of Palo Alto to post to the City’s website the attached Board and Commission Application intact. I have read and understand my rights under Government Code Section 6254.21. I may revoke this permission at any time by providing written notice to the Palo Alto City Clerk. Alternate Contact Information - Address Alternate Contact Information - Phone Number Alternate Contact Information - Email 2 of 5 2.a Packet Pg. 36 Personal and Job Experience Please list your relevant education, training, experience, certificates of training, licenses, and professional registration. (621 characters max) MS Pharmaceutical Sciences - worked in the Biotech industry for over 25 years and have a mindset to work towards better governance and compliance in public health for communities. Have been part of the PTA at Duveneck and Palo Alto High School, and volunteered heavily in the school district for the last 11 years. Am the block disaster coordinator and also helped neighbors widely during Covid, esp those with preexisting conditions and vulnerabilities. Am actively engaged as a parent leader in the BSA Troop 57 Boy Scout troop in Palo Alto. My life goal is to volunteer and give back to my neighbors and community. Employment Information Company/Employer Name gCompliance, Inc. Occupation Scientist Is your Company/Employer your current one or last?Current Employer Please describe your involvement in community activities, volunteer and civic organizations, including dates and any offices held. (1242 characters max) 1989-1992 Built a audio book library with recorded books for the visually handicapped in Bombay, India 1992-1994 Raised funds for natural disasters such as floods and earthquakes in the world for the school of Internally affairs, UConn , CT 1995-1999 Served a non-profit to assist poor children gain scholarships. 2000-2004 Worked to raise money to serve Breast cancer 2013 Raised money and walked 39.2 miles for Breast cancer awareness. 2006-2017 Active volunteer in PAUSD schools, Duveneck PTA and PALY PTA-2022 Parent leader in BSA Boy Scouts of America Troop 57 3 of 5 2.a Packet Pg. 37 Application Questions 1. W hy are you interested in serving on the Human Relations Commission and what experience would you bring to the position? (1518 characters max) I want to work on actionable items on the city’s community planning and help my community 2. Please describe an issue that recently came before the Commission that is of particular interest to you and describe why you are interested in it. (1449 characters max) Archived video meetings are available from the Midpen Media Center. Castelija school building issue 3. If you are appointed, what specific goals would you like to see the Human Relations Commission achieve, and how would you help in the process? (1656 characters max) I would like to streamline homelessness and see how best to svt 4. Human Relations Commission Members work with the documents listed below. If you have experience with any of these documents, please describe that experience. Experience with these documents is not required for selection. (690 characters max) Human Services Needs Assessment (2020) Muni Code 9.72 – Mandatory Response Program Community Services Element of the Comprehensive Plan (2017) I do not have any experience but would love to learn more. If you'd like to provide any additional documents, please upload below. 4 of 5 2.a Packet Pg. 38 Please confirm that you have read the Boards and Commissions Handbook. View the Boards and Commissions Handbook. Yes Signature Name of signatory: Chitra Sharma Link to signature Date Completed 06/17/2022 5 of 5 2.a Packet Pg. 39 Human Relations Commission Application Submission date:26 July 2022, 3:45PM Receipt number:13 Related form version:3 Personal Information Name Kat Snyder Address City Postal Code Cell Phone Number Home Phone Number Email Address Are you a Palo Alto resident?Yes Do you have any relatives or members of your household who are employed by the City of Palo Alto, who are currently serving on the City Council, or who are Commissioners or Board Members? No Are you available and committed to complete the term applied for? Yes 1 of 8 2.a Packet Pg. 40 Fair Political Practices California state law requires board/commission members to file a disclosure of financial interests (Fair Political Practices Commission, Conflict of Interest, Form 700). Do you/your spouse have an investment in, or do you or your spouse serve as an officer or director of, a company doing business in Palo Alto which you believe is likely to: 1. Engage in business with the City; 2. Provide products or services for City projects; or 3. Be affected by decisions of this Board or Commission? No Excluding your principal residence, do you or your spouse own real property in Palo Alto? No How did you learn about the vacancy on the Human Relations Commission? Other: watching HRC and City Council meetings Consent to Publish Personal Information on the City of Palo Alto Website Read the code, and check only ONE option below:I request that the City of Palo Alto redact my home address, phone numbers, and email address from the attached Board and Commission Application prior to posting to the City’s website. I am providing the following alternate information and request that the following contact information below: Alternate Contact Information - Address Alternate Contact Information - Phone Number Alternate Contact Information - Email katsnyderux@gmail.com Personal and Job Experience 2 of 8 2.a Packet Pg. 41 Please list your relevant education, training, experience, certificates of training, licenses, and professional registration. (621 characters max) User Experience Researcher/Designer, Catalina Labs, Palo Alto, CA, 2016-2017 User Experience Researcher, Go Live Labs, Sunnyvale, CA, 2016 M.A. Psychology, Cognition and Perception UT Austin, 2014 (PhD Coursework) B.S. Symbolic Systems, Stanford University, 2006 Educated in PAUSD 1990-2002 Peace Ambassador Training (one evening, July 2020) via San Jose Peace and Justice Center. Learned de- escalation tactics useful for march and rally organizers. Poll Monitor Training (one evening, before each volunteer day) via Asian Law Caucus - Northern California chapter Employment Information Company/Employer Name Ashworth College, HVAC certification program Occupation student Is your Company/Employer your current one or last?Current Employer 3 of 8 2.a Packet Pg. 42 Please describe your involvement in community activities, volunteer and civic organizations, including dates and any offices held. (1242 characters max) - 350 Palo Alto Steering Committee Member, March 2022-present. Helped organize the 2022 Earth Day event co-sponsored by the City of Palo Alto. Organized an upcoming demo of an induction cooktop powered by an electric vehicle at the Sept 25th Midtown Ice Cream Social. - Palo Alto Against ICE, head of Ordinance Committee, 2019-2020. The primary goal was to research whether to and how to pass a city ordinance that prohibits the city from contracting with any companies that pass information to ICE. We also ran actions such as public comment campaigns against allowing Palantir to co-sponsor any city cultural events, and a protest rally in front of Palantir that got covered in Business Insider. - Volunteer Poll Monitor - Asian Law Caucus - Northern California chapter. November 2020 general election, monitored 4 precincts in San Francisco. June 2022 primary election, monitored 4 precincts in Stanislaus County. - Co-op Director, Laurel Housing Co-op, Austin, TX, 2008-2009 Ran a 60 person housing co-op as well as managing a team of house officers. Ran house elections and weekly house meetings. - Board Member (and Finance Subcommittee Member), College Houses Board of Directors, Austin, TX, 2008-2009 Application Questions 4 of 8 2.a Packet Pg. 43 1. W hy are you interested in serving on the Human Relations Commission and what experience would you bring to the position? (1518 characters max) This particular slot only runs through March and it leaves the Climate Emergency workplan item without any commissioners. I’ve attended the HRC meetings for the past 3 years, I’ve watched every S/CAP meeting, and I’m a steering committee member of 350 Palo Alto. I believe I’m well positioned to start work on the HRC and also to help head the Climate Emergency item. Participating in city government meetings has taught me the scope of different committees/commissions and of the standard deliverables from one body to another. Getting from ideas to action involves understanding the city process and how different suggestions create different administrative burdens. I also learn some of the latest city work on electrification through my weekly 350 Palo Alto meetings, which gives me more context for the city's plans around the climate emergency and can help me make recommendations that are better scoped for the city. My graduate psychology background helps me digest and summarize the latest research about racial trauma and effective healing interventions. We need to use every tool in our toolbox to help provide healing and create community resiliency as hate crimes only continue to increase. My work in cognitive psychology, and user experience research and design, is especially pertinent when designing for communities with disabilities or other marginalized communities. I would also be well- equipped to read through that research and bring that knowledge to the table when designing new policies. 5 of 8 2.a Packet Pg. 44 2. Please describe an issue that recently came before the Commission that is of particular interest to you and describe why you are interested in it. (1449 characters max) Archived video meetings are available from the Midpen Media Center. I have followed the national conversation around policing, racism, and criminal justice reform since Trayvon Martin was killed in 2012, but that was mostly educating myself on the latest academic research around the subject. After the death of George Floyd, I made a promise to myself to get actively involved in these issues at a city level because I can best make a difference at the local level. I followed the 8 Can't Wait conversations through the HRC, City Council and various other city forums at the time. I gave comment where I thought appropriate - around changes in police policy, around the first amendment right to protest, and around the press' role in police oversight. I even read through academic papers around police policy reform and pulled out an actionable suggestion, which the HRC's then Vice Chair Valerie Stinger forwarded to City Council. Over time and with experience, I'm learning to hone my recommendations to better interface with city government and I have also gradually gotten a wider sense of the number of departments and bodies that could and should be considered stakeholders in these issues. I am committed to strengthening the city's process around improving police policy as informed by a wide variety of community, academic research, and criminal justice perspectives. 3. If you are appointed, what specific goals would you like to see the Human Relations Commission achieve, and how would you help in the process? (1656 characters max) Note: Because of the short timeframe, I would first ask the HRC to help me scope and prioritize the following ideas Climate Change: develop a disability-inclusive plan for public safety power shutoffs, wildfires, and floods. - Collect and summarize background research on what people across the spectrum of disability need from emergency services. - Interview a range of disability activists, disability organizations, people with disabilities, and caregivers 6 of 8 2.a Packet Pg. 45 (when applicable) on their emergency services needs and the barriers to meeting them. - Seek out partnerships with governmental and non- governmental organizations that help provide emergency services to people with disabilities. Include any relevant stakeholders around our city's emergency services in this conversation. - Start a conversation around whether any of the organizations from the previous bullet point should be invited to apply for HSRAP grants, including the Emerging Needs fund. Hate Crimes: - Flesh out trauma-informed interventions for victims of Hate Crimes - Partner with a community group that holds bystander intervention trainings and create an advertising campaign to urge Palo Alto residents to complete the training Police Reform: - The HRC's review of 8 Can't Wait (as directed by City Council) was triggered by a national tragedy. Going forward, it makes sense to create objective criteria for triggering a review of police policy by the City Council - and/or by the HRC, when applicable. I would recommend that the HRC, in co-operation with relevant stakeholders, draft a set of criteria for City Council to review. 7 of 8 2.a Packet Pg. 46 4. Human Relations Commission Members work with the documents listed below. If you have experience with any of these documents, please describe that experience. Experience with these documents is not required for selection. (690 characters max) Human Services Needs Assessment (2020) Muni Code 9.72 – Mandatory Response Program Community Services Element of the Comprehensive Plan (2017) I am familiar with the Human Services Needs Assessment document as that shows up during HRC meetings. I am not familiar with the other two, but feel confident I could use them to fulfill my duties. If you'd like to provide any additional documents, please upload below. Please confirm that you have read the Boards and Commissions Handbook. View the Boards and Commissions Handbook. Yes Signature Name of signatory: Katherine "Kat" Snyder Link to signature Date Completed 07/26/2022 8 of 8 2.a Packet Pg. 47 City of Palo Alto (ID # 13999) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Consent Calendar City of Palo Alto Page 1 Title: Adoption of a Resolution Establishing FY 2023 Property Tax Levy for General Obligation Bonds (Measure N Libraries) From: City Manager Lead Department: Administrative Services Recommendation Adopt a resolution (Attachment A) approving the establishment of the Fiscal Year (FY) 2023 property tax levy of $8.16 per $100,000 in Assessed Value (AV) for the secured and utility tax roll and $9.26 per $100,000 in AV for the unsecured tax roll for the City of Palo Alto's Measure N General Obligation (GO) Bond Library Bonds (First and Second Series). Background On November 4, 2008, City voters passed Measure N which gave the City authority to issue a maximum amount of $76 million of General Obligation bonds (the "Bonds") for capital improvements to the Mitchell Park, Downtown, and Rinconada (formerly Main) libraries and to construct the Mitchell Park Community Center. The City successfully sold the Bonds in two series to provide $76 million in funds for the design and construction costs. Both Standard and Poor's (S&P) and Moody's awarded their highest credit ratings, Triple A, to both series of Bonds which was affirmed by Standard and Poor’s and Moody’s in March 2021. On March 1, 2016, Council approved the decommissioning of the Library Bond Oversight Committee and accepted a financial report showing approximately $3.0 million in project savings (CMR: 6632). In addition, bond premium of $3.1 million could be used to redeem and/or defease bonds. On June 6, 2016, Council authorized the use of $6.1 million of the Series 2010A & 2013A GO Bonds to defease and/or retire a portion of outstanding bonds and to pay associated redemption costs (CMR: 6993). To maximize savings to property owners the longest bonds were paid off; total savings of $11 million were realized which includes $4.9 million in interest savings over time. Of the $11 million, $5.4 million will be saved through FY 2040 while $5.6 million will be saved from FY 2041 through FY 2044. On March 2, 2022, Council approved the refinancing of the Series 2010A and 2013A outstanding principal of $40.6 million and $13.6 million respectively (CMR: 13438) on page 12 of link). The Series 2010A was refinanced as a tax-exempt bonds and Series 2013A was partially refinanced as taxable bonds. The tax reform bill passed by Congress and signed into law on 3 Packet Pg. 48 City of Palo Alto Page 2 December 22, 2017 prohibits the issuance of tax-exempt advance refunding bonds during the (ten-year) call protection period. The call protection period has passed on the Series 2010A Bonds, but it has not passed for the Series 2013A Bonds. The portions of the Series 2013A bonds or $2.1 million in principal, that had realized savings were refinance d. In total, a net present value savings of $4.5 million or 10.6 percent was realized. The cash savings is $6.4 million and average annual debt service savings over 18 years is $356 thousand. In the Council refinancing approval CMR the total cash savings was estimated at $7.5 million, however, the interest rate rose before the refinancing occurred due to the Federal Open Market Committee (FOMC) raising the federal funds rate by 0.25 percent on March 16, 20 22. This was the first FOMC rate increase after 17 consecutive meetings, since March 2020. There are three GO Bonds outstanding, the portion of the tax-exempt Series 2013A bonds that were not refinanced, the tax-exempt Series 2022A bonds that refinanced the Series 2010A bonds, and the taxable Series 2022B bonds that partially refinanced the Series 2013A bonds. Standard and Poor's (S&P) affirmed their highest credit ratings, Triple A, to both the issuer or City of Palo Alto’s General Fund credit rating and the long-term rating on the City’s GO Bonds outstanding in May 2022. As of July 1, 2022, principal amount of $48.7 million is outstanding on the GO Bonds. Discussion Debt service payments on these Bonds are paid through ad valorem taxes on all taxable land and improvements (both secured and unsecured assessment roll) within the City. An ad valorem tax is a tax based on the assessed value of real estate (land, buildings and other structures) or personal property (e.g. airplane, business machinery, etc.). Staff is seeking Council approval of the attached resolution (Attachment A) which authorizes th e placement of an ad valorem property tax levy in the amount of $0.00816 per $100 or $8.16 per $100,000 in AV for the secured tax roll; and $0.00926 per $100 or $9.26 per $100,000 in AV for the unsecured tax roll. In comparison, prior year’s secured and unsecured tax levy was $9.26 and $9.56 respectively, per $100,000 of AV. The assessment rate for FY 2023 is decreasing for both the secured and unsecured property taxes. The rate decreases are attributable to the rise in the Secured AV for properties throughout Palo Alto by 6.4 percent, an increase of $2.7 billion and the decrease in the annual debt service payments due to the lower interest rate realized due to the June 2022 refinancing. In addition, the rise in AV during FY 2023, due to property sales and new construction, resulted in excess collections which further reduced the FY 2023 annual assessment. As for the unsecured property taxes, per the County of Santa Clara’s methodology, the prior year’s secured tax rate becomes this year’s unsecured tax rate as a result this rate won’t benefit from the coming year’s AV increase and prior fiscal year’s refinancing until FY 2024. However, it did benefit from the Secured AV increase that occurred in FY 2022. 3 Packet Pg. 49 City of Palo Alto Page 3 With the new assessment for FY 2023, a house with an assessed value of $1.0 million, for example, would see an annual assessment of $81.60 on their property tax bill. In comparison, in FY 2022, a $1.0 million home had an assessment of $92.60. Resource Impact The bond issuances result in a 2023 calendar year debt service expenditure of approximately $4.11 million and Council approval of the attached resolution will result in ad valorem tax levy revenue of $3.82 million with the $0.30 million difference attributable to available funds on hand. As outlined in the Discussion section of this report, the secured and unsecured property owners will see a levy of $8.16 and $9.26, respectively, per $100,000 of AV on their FY 2023 property tax statement. Stakeholder Engagement This levy was reviewed and approved the voters in Palo Alto as part of the November 2008 election. Environmental Review There is no environmental review required for this report . Attachments: • Attachment3.a: Attachment A: Resolution Establishing FY 2022-23 Property Tax Levy 3 Packet Pg. 50 1 Attachment A Not Yet Approved Resolution No. Resolution of the Council of the City of Palo Alto Establishing Fiscal Year 2023 Property Tax Levy of $8.16 Per $100,000 of Secured and $9.26 Per $100,000 of Unsecured Assessed Valuations for the City’s General Obligation Bond Indebtedness (Measure N Library Projects) R E C I T A L S A. At the City of Palo Alto’s (“City”) general election held on November 4, 2008, more than two-thirds of voters approved Measure N, authorizing the issuance of general obligation bonds in the amount not to exceed $76,000,000 (the “Authorization”) to fund construction of a new Mitchell Park Library and Community center and renovation and improvements to Downtown and Main libraries. B. Pursuant to the Authorization, the City issued two series (Series 2010A and 2013A) of general obligation bonds in June 2010 and June 2013 that yielded $75.8 million for project needs. In June 2022, the Series 2010A was refinanced with a tax-exempt Series 2022A and the Series 2013A was partially refinanced with a taxable Series 2022B. As a result, there are three general obligation bonds series outstanding, the Series 2013A portion that wasn’t refinanced and the refinanced Series 2022A and 2022B bonds. C. The City is obligated to levy ad valorem taxes on all property within the City subject to taxation by the City, without limitation on rate or amount (except with respect to certain personal property which is taxed at limited rates), for the payment of the debt service on the Bonds. D. The City is obligated to direct the County of Santa Clara to collect such ad valorem taxes in such amounts and at such times as is necessary to ensure the timely payment of debt service on the Bonds. E. The amount of the annual ad valorem tax levied by the City to repay the Bonds is determined by the relationship between the assessed valuation of taxable property in the City and the amount of debt service due on the bonds. The Council of the City of Palo Alto RESOLVES as follows: SECTION 1. Pursuant to the Authorization, an ad valorem property tax is hereby established to be levied on all land and improvements in the City of Palo Alto during Fiscal Year 2023 in the amount of $0.00816 per $100 in assessed value for the secured and utility tax roll and $0.00926 per $100 in assessed value for the unsecured tax roll based 3.a Packet Pg. 51 2 Attachment A Not Yet Approved on the calculations set forth in the attached Exhibit "A". SECTION 2. The City’s Director of Administrative Services shall cause a certified copy of this Resolution to be delivered to the Auditor of the County of Santa Clara for entry in the assessment book of the respective sums in dollars and cents, to be paid as established by this Resolution. SECTION 3. The Council finds that this is not a project under the California Environmental Quality Act and, therefore, no environmental impact assessment is necessary. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: City Clerk Mayor APPROVED AS TO FORM: APPROVED: Assistant City Attorney City Manager Director of Administrative Services 3.a Packet Pg. 52 A) Assessed Valuations (AV) 1 ) 2022-23 Taxable Secured Assessed Valuation (AV) 44,434,380,962$ 2 ) 2022-23 Taxable Unsecured AV 2,088,552,009$ 3 ) Less: Estimated Delinquency 0.00% -$ 4 ) Net Taxable Unsecured AV 2,088,552,009$ 5 ) Total Assessed Valuation (AV)46,522,932,971$ B) Tax Levy Requirement 5 ) 2023 Calendar Year Debt Service Payments 2013 (Tax-Exempt) GO Bonds - February 1,2023 234,650.00$ 2013 (Tax-Exempt) GO Bonds - August 1, 2023 739,650.00 974,300.00 6 ) 2022A (Tax-Exempt) GO Bonds - February 1,2023 1,076,093.75$ 7 ) 2022A (Tax-Exempt) GO Bonds - August 1, 2023 1,965,875.00 3,041,968.75 8 ) 2022B (Taxable) GO Bonds - February 1,2023 52,750.00$ 9 ) 2022B (Taxable) GO Bonds - August 1, 2023 42,200.00 94,950.00 10 ) Total Calendar Year 2023 Debt Service Payments 4,111,218.75 11 ) Excess Funds on Hand Applied Toward Debt Service (300,000.00) 12 ) Sub-total 3,811,218.75 13 ) Santa Clara County Administration Fee (0.25% of Principal & Interest) 9,528.05 14 )Total 2022-23 Annual Debt Service Requirement 3,820,746.80 C)Secured and Unsecured Tax Rate 15 )2022-23 Unsecured Tax Rate per $100 of Unsecured AV (Prior Year's Secured Tax Rate) 0.00926$ 16 )2022-23 Unsecured Tax Rate per $100,000 of Unsecured AV 9.26$ 17 ) 2022-23 Estimated Revenue from Unsecured AV (line 4 divide by 100 times by line 12) 193,399.92$ 18 ) 2022-23 Estimated Revenue from Secured AV (line 11 minus line 13) 3,627,346.88 19 ) Total 2022-23 Annual Debt Service Requirement 3,820,746.80$ 20 )2022-23 Secured Tax Rate per $100 of Secured AV (line 14 divided by line 1*100) 0.00816$ 21 )2022-23 Secured Tax Rate per $100,000 of Secured AV (line 14 divided by line 1 times 100,000) 8.16$ Exhibit A City of Palo Alto General Obligation (GO) Bonds, Election of 2008, Series 2013, 2022A and 2022B Tax Rate Calculation Based on 2022-23 Assessed Values 3.a Packet Pg. 53 City of Palo Alto (ID # 14468) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Consent Calendar City of Palo Alto Page 1 Title: Approval of the Rail Committee Charter and Workplan for 2022 -23 From: City Manager Lead Department: Transportation Department Recommendations Rail Committee and Staff recommend that the City Council approve the Rail Committee Charter including its Guiding Principles and the Rail Committee Workplan for 2022-23. Executive Summary The Rail Committee and Staff worked to develop the Rail Committee Charter including the Rail Committee Guiding Principles and the Rail Committee Workplan for 2022-23. The Workplan includes the delegation of additional items within the Rail Committee scope associated with rail crossings as follows: • Policy Items: Review grade separation selection criteria for any revisions • Bicycle and Pedestrian Items: Advance the planning and selection of new east-west bike/ped rail crossings, including consideration of whether the City should move forward on specific crossings before the upcoming Bicycle and Pedestrian Transportation Plan is finished. • Funding Items: Seek/Obtain funding for Palo Alto rail crossing projects and new east- west bike/ped rail crossings The Rail Committee and staff recommend the City Council approval of the Rail Committee Charter and its Workplan. Background and Discussion With the re-initiation of the Rail Committee in April 2022, one of the tasks was to review the guiding principles and the committee workplan. Rail Committee Charter & Guiding Principles The rail committee charter and guiding principles provide for the framework and guidance to the Rail committee in performing, reviewing, conducting, and directing staff for work related to rail related infrastructure projects. The proposed update to the Committee charter in Attachment A would reflect anticipated work of the Committee in 20 22 and 2023, and primarily includes the following: 4 Packet Pg. 54 City of Palo Alto Page 2 • Reviewing the mobility including bicycle and pedestrian across the Caltrain corridor ; • Advocating for funding for Palo Alto grade separations; • Monitoring activities of the California High Speed Rail Authority and Caltrain; • Monitoring other relevant activities in the rail corridor such as San Francisquito Bridge along the Caltrain Corridor; • Recommending specific comments/actions to the full Council The Rail Committee and staff discussed the Rail Committee Charter that includ es the guiding principles at its June 15, 2022, meeting. The 2014 Rail Committee charter including the guiding principles was updated to reflect the current workplan related to the upcoming rail-related projects. The Charter was further worked upon by the Rail Committee Ad-hoc members as directed by the committee. The updated draft of the Rail Committee Charter is included in Attachment A. Rail Committee Workplan The Rail Committee Workplan for 2022-23 was developed in coordination with the rail committee with input from the community and members of the Expanded Community Advisory Panel (XCAP). The committee worked to refine the workplan at its May and June meeting s. The workplan for 2022-23 was finalized by the committee on June 15, 2022. The detailed Rail Committee Workplan for 2022-23 is included in this report as Attachment B. The Rail Committee Workplan includes various elements related to the rail corridor. These items were previously in the rail charter and includes activities related to grade sepa rations and other items relevant to rail corridor, such as advocating for funding and monitoring activities for California High Speed Rail and Caltrain. With the re-initiation of the rail committee, the review the work associated with additional studies directed by the council involving geotechnical study, review of construction technologies, refinement of the partial underpass/underpass alternatives of the grade separation, and outreach to key stakeholders would fall within the scope of Rail Committee. Additionally, Council directed rail committee to include the following elements: 1. Review of the guiding principles and criteria 2. Pursue with Caltrain the reduction in areas in Palo Alto being considered for four tracks 3. Facilitate and engagement with Palo Alto Unified School District (PAUSD) and Stanford on all grade crossings 4. Engage with Caltrain through the Local Policy Makers Group (LPMG) and staff to design alternatives and construction methods preferable to Palo Alto. However, the workplan prepared by the Rail Committee will need the delegation of the following items to the Rail Committee's purview by the City Council: Policy Items • Review grade separation selection criteria for any revisions 4 Packet Pg. 55 City of Palo Alto Page 3 Bicycle and Pedestrian Items • Advance the planning and selection of new east-west bike/ped rail crossings, including consideration of whether the City should move forward on specific crossings before the upcoming Bicycle and Pedestrian Transportation Plan is finished. Funding Items • Seek/Obtain funding for Palo Alto rail crossing projects • Seek/Obtain funding for new east-west bike/ped rail crossings The Rail Committee approved its Charter and Workplan for 2022-23 with the consensus approval of the committee. Therefore, Rail Committee and Staff recommend that th e City Council approve the Rail Committee Charter including its guiding principles and Rail Committee Workplan for 2022-23 Resource Impact The work involved in performing actions included in the Rail Committee Workplan for 2022-23 is generally associated with the grade separation projects. However, there may be some elements in the Workplan that involve other approved Capital Improvement Projects. Any project(s) resulting from the discussions at the Rail Committee will require City Council approval and direction. There is no financial impact at this time. Stakeholder Engagement The Rail Committee meetings are open to the public and therefore provide the community with opportunities to provide comments to the rail committee and the City. In 2022, these meetings were held on April 20, May 18, and June 15. Environmental Review The recommendation in this report does not constitute a project in accordance with the California Environmental Quality Act and is therefore not subject to environmental review. Attachments: • Attachment4.a: ATTACHMENT A - Rail Committee Charter and Guiding Principles • Attachment4.b: ATTACHMENT B - Rail Committee Proposed 2022-23 Workplan 4 Packet Pg. 56 Rail Committee Charter  Proposed Draft August 9, 2022    Preamble  The City of Palo Alto supports transportation and urban design solutions for the Caltrain  corridor that are compatible with community values and that complement the goals and  policies of the City’s Comprehensive Plan.  The Caltrain corridor has long been a physical constraint to east‐west movement in Palo  Alto, and the current grade crossings create traffic congestion and pose safety and noise  challenges that will get worse as the frequency of train service increases. As a result, the  City actively participates in planning for the rail corridor, and supports changes that  improve and do not exacerbate impacts to the Palo Alto community.  Purpose of the Committee:   The formation and purpose of the Rail Committee has changed over the years. In 2008, California  voters pass Proposition 1A, the Safe, Reliable High‐Speed Passenger Train Bond Act for the 21st  Century, authorizing issuance of $9.95 billion of general obligation bonds to partially fund a  statewide high‐speed rail system. In 2009, the City Council created an ad hoc High Speed Rail Sub‐ Committee (which later became a standing committee and was renamed the High Speed Rail  Committee) to swiftly be able to respond to the California High Speed Rail project planned for the  Caltrain line. The Council also adopted a set of Guiding Principles which allowed the Committee to  take a variety of actions in the name of the City without action of the full Council.   The Committee subsequently updated its Guiding Principles in 2010 and 2011 to address project  changes. In 2012, Caltrain approved their Electrification Project and in 2013, the High Speed Rail  Authority and Caltrain signed a Memorandum of Understanding for operations along the Caltrain  corridor. As such, in 2013 the Committee was re‐named the Rail Committee to reflect the focus of  issues related to Caltrain and High Speed Rail’s agreement to operate a “blended system” on the  Caltrain corridor.   In 2015, the Rail Committee was re‐established with the goal of advancing the City’s objectives  regarding grade separations. In 2016, Santa Clara County Voters Passed Measure B which includes  $700 million for grade separations along the Caltrain Corridor. Work on grade separations  continued in 2017 and 2018.   In 2019, Caltrain began work on it’s business plan while the City Council voted to further advance  grade separation work through a series of community meetings and the formation of a Community  4.a Packet Pg. 57 Advisory Panel (CAP) and then an Expanded Community Advisory Panel (XCAP) which provided  their final report to the City Council in 2021.   The City Council’s Rail Committee was re‐established in 20222015 to further analyze and advance  grade separated crossings for all modes of travel (bicycles, motor vehicles, transit, and  pedestrians). While the Committee in the past has focused on High Speed Rail, Caltrain grade  separations and electrification will be the essential focus of the Committee for 2017‐2018.  A detailed timeline of the City’s work on the Rail Corridor from 2008‐2021 is available at:  https://connectingpaloalto.com/timeline/  Guiding Principles  1. Palo Alto seeks to improve east‐west connectivity, traffic circulation, pedestrian and bicycle  movements, safety, and the noise environment along the Caltrain corridor.  2. Palo Alto strongly supports Caltrain and the improved commuter rail service that will come  as a result of modernization (including electrification).  3. Palo Alto will continue to work with Caltrain to ensure that all potential impacts of  modernization are addressed and adopted mitigation measures are implemented.  4. Palo Alto supports Caltrain as the lead agency for all system improvements in the Caltrain  corridor.  5. Palo Alto has long had concerns about the potential impacts of High Speed Rail and  believes that the project should be terminated. If the project proceeds, CHSRA should  provide funding for affected cities to analyze potential impacts and needed infrastructure.   6. Palo Alto believes that CAHSRA must coordinate with Caltrain as the lead agency and  should fund the study and construction of any potential passing tracks and, if needed,  grade separations or modifications to grade separations and should not commence service  until they are complete.  7. Palo Alto will advocate strenuously for its fair share of County Measure B funding for grade  separations and actively seek additional funding from Caltrain, CAHSRA, Santa Clara  County, VTA, MTC, State, Federal, and other external funding sources.  8. Palo Alto supports the use of the Context Sensitive Solutions process for High Speed Rail  and grade separations and will structure a CSS process to engage the community in  selection of a preferred grade separation alternative for the corridor.  9. Palo Alto seeks modernization of freight operations onin the corridor and will seek  flexibility from the UPRR to pursue desired improvements in the Caltrain corridor.  10. Palo Alto will work cooperatively with neighboring communities with respect to HSR and  Caltrain issues of mutual concern, including grade separations, through efforts such as the  Caltrain Local Policy Maker Working Group (LPMG). 4.a Packet Pg. 58 Attachment B DRAFT RAIL COMMITTEE 2022-23 WORKPLAN Focus Issue Planned Rail Committee Activities Anticipated Timeframe A. Advance the planning and design of preferred rail crossing alternatives • Review grade separation selection criteria for any revisions • Receive progress reports and review consultant engineering studies as work proceeds • Monitor and engage with Caltrain on San Francisquito Bridge rehabilitation • Consider the Comprehensive Plan, the Bicycle and Pedestrain Transproation Plan, the 2012/2013 Rail Plan, and the SCAP plan in the review of grade separation election criteira. • Additional studies will take up to a year, dependent on start date and other criteria (such as any holds for 4 tracks info etc.) B. Seek/Obtain funding for Palo Alto rail crossing projects • Support for new funding opportunities and grants • Monitor and engage with Caltrain, VTA, MTC, CAHSR, and other State/Federal funding/legislation • City has advocated for funding opportunities and applied for grants • This is an ongoing task C. Seek changes to rail design criteria/technical standards in order to reduce costs and uncertainty to Palo Alto crossing projects • Advocate Caltrain review and revision of design criteria/technical standards through LPMG • Monitor and engage on HSR final EIR/EIS • Letters to Caltrain sent regarding 4-tracks and key design standards • LPMG receiving regular updates on Caltrain grade separation study D. Advance the planning and selection of new east-west bike/ped rail crossings • Receive updates and provide feedback on new crossings as Bicycle and Pedestrian Transportation Plan (BPTP) Update proceeds • Rail Commmittee to work in parallell with BPTP update process for planning and prioritizing these new east-west bike/ped crossings. • BPTP project is scheduled with procurement for Request for Proposals in Summer, project to continue into 2023 E. Seek/Obtain funding for new east-west bike/ped rail crossings • Engage VTA for use and prioritization of Measure B Grade Separation funds for bike/ped crossings • Letter sent to VTA requesting Measure B fund eligibility – awaiting VTA full response • Staff reviewing Embarcadero/Alma near-term options & prior CIP project end of life consideration of Embarcadero-Alma project. • Major funding applications will follow BPTP location selection 4.b Packet Pg. 59 Focus Issue Planned Rail Committee Activities Anticipated Timeframe F. Explore establishment of quiet zones at Palo Alto Avenue and elsewhere as applicable • Receive updates and provide feedback on quiet zone study for Palo Alto Avenue • TBD, pending Menlo Park’s bids/contract award G. Engage Palo Alto community in all rail planning activities • Receive presentations from outside agencies • Receive information from additional community engagement including (PAUSD, Stanford, PABAC, CSTSC, community design experts) • Following additional meetings, which are scheduled to occur in Summer/Fall H. Engage with regional and state agencies • Participate and provide updates: o Caltrain Local Policy Makers Group (LPMG) Delegated to Rail Committee o VTA Board • Ongoing 4.b Packet Pg. 60 City of Palo Alto (ID # 14575) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Action Items City of Palo Alto Page 1 Title: Approval of Appointment and Employment Agreement with Andrew Binder as Chief of Police From: City Manager Lead Department: Human Resources Recommendation The City Manager recommends that the City Council approve the appointment of Andrew Binder as Chief of Police and his employment agreement (Attachment A). Background The Palo Alto City Charter and Municipal Code establish the City Manager as the appointing authority for all officers, department directors, and employees under the City Manager’s control. The City Charter and Municipal Code additionally specify that the City Manager’s appointments of department heads are subject to approval of the City Council 1. Employment terms or benefits not included in the Council-approved Compensation Plan for Management and Professional Personnel require City Council approval. The Chief of Police position became vacant because of the retirement of Robert Jonsen announced earlier this year. The Palo Alto Police Department is one of fourteen departments in the City of Palo Alto and is supported by 125.5 FTE (86 sworn) and has an annual FY 2021 -22 General Fund budget of $40 million. The Department is organized across eight divisions: Field Services, Technical Services, Investigations, Traffic Services, Parking Services, Police Personnel Services, Animal Services, and Administration. The Department responds to 55,000 calls for service annually with an average current response time of 6:30 for emergency calls. Discussion The City Manager recommends approval of the appointment of Andrew Binder to the position of Chief of Police2. Binder’s law enforcement experience includes serving eighteen years with 1 Palo Alto Municipal Code 2.08.020 Approval of city manager's appointments. 2 Department Director responsibilities are specified in Palo Alto Municipal Code as follows: 2.08.170 Police department. 5 Packet Pg. 61 City of Palo Alto Page 2 the City of San Jose in addition to more than seven years in Palo Alto. In Palo Alto, Binder held several command level executive leadership roles; progressing within the department from Lieutenant to Captain, and two years of experience as Assistant Chief, before serving in his current capacity as Acting Chief of Police since June. Binder holds a Criminal Justice Administration degree from San Jose State University and a Master's Degree in Criminal Justice from Arizona State University. He has also completed the FBI National Academy for Law Enforcement Managers, the POST Executive Development Course, the Stanfor d Local Government Summer Institute, and Leadership Palo Alto. Binder was selected as a result of an extensive search that attracted nationwide interest among executive and qualified public safety leaders, conducted by the City’s Human Resources Department with assistance by Teri Black & Company. The City began recruitment for the Chief of Police in January 2022 when Chief Robert Jonsen announced his plans to retire in the summer of 2022. The City’s outreach strategy was to reach highly qualified and ded icated public safety leaders who align with the diverse and forward-thinking Palo Alto community. The City invested in advertising with 10 executive public safety sites, relevant government and affinity group-focused job boards, the City of Palo Alto’s website with a dedicated page, and direct mailing outreach to 200 top safety leaders nationwide. In addition, the City Manager also conducted direct personal outreach to highly respected regional chiefs. This outreach resulted in 1,386 individuals viewing the job posting and 12 qualified public safety leaders submitting a cover letter and resume. For context, this volume of views is high, and th e number of candidates is typical for this type of position.  The selection and screening process included: 1) Experience, education, and training review of submitted candidate materials and phone screen of best-qualified applicants by consultant and Human Resources staff. 2) Multiple panel interviews that included residents, local business, faith, education, and other organizations, City leadership staff, public safety unions and police chiefs from other Bay Area cities. More details are provided in the Stakeholder Engagement section below. 3) Final interviews conducted by the City Manager with the top candidates. Binder will be an “At-Will” employee, which means he will serve at the pleasure of the City Manager and can be terminated or asked to resign at any time. His initial annual salary will be $295,484 which is within the Council-approved salary range for the Police Chief position. The employment agreement includes 24 weeks of severance, which is commensurate with other highly responsible executive positions. The agreement also adjusts Binder’s annual vacation accrual to 200 hours annually in recognition of his prior years of service as a public safety officer. All other benefits offered are consistent with the Compensation Plan for Management and Professional Personnel. Binder’s appointment will be effective on August 9, 2022. 5 Packet Pg. 62 City of Palo Alto Page 3 Resource Impact The Police Chief position is included in the FY 2023 Adopted Budget. No budget modifications or additional funding are necessary. Policy Implications This recommendation is consistent with existing City policies. Stakeholder Engagement In March, community engagement for the selection of the next Chief of Police began, and included a listening session hosted by the Human Relations Commission on March 10 , 2022 with City Manager Ed Shikada, and the two community listening sessions hosted by City Manager Shikada on March 19 and 31, 2022. The input received, and other feedback gained via a web input form and direct emails to the City Manager also helped to inform the process. Themes heard from the community include transparency, accountability, and the importance of making community connections. The City’s recruitment brochure and candidate profile for the Chief of Police included themes from the community engagement process. To review all the online feedback received through this process, a dedicated webpage was set up for the selection process of the Chief of Police and can be accessed at www.cityofpaloalto.org/policechiefselection. The panel interview process consisted of 16 stakeholders including residents, local business, faith, City Executive Leadership staff, public safety unions and Police Chiefs from Bay Area cities. Panelists included Don Austin, Superintendent, PAUSD; Lt. Ben Becchetti, Labor (PMA); Geo Blackshire, Palo Alto Fire Chief; Agt. Christopher Correia, Labor (PAPOA); Chantal Cotton Gaines, Palo Alto Deputy City Manager; Winter Dellenbach, Community Member; Erica Escalante, President, Buena Vista Residents Association; Annette Glanckopf, Team Leader, Palo Alto Emergency Services Volunteers; Hamilton Hitchings, Community Member; Meghan Horrigan-Taylor, Palo Alto Chief Communications Officer; Chris Hsiung, Mountain View Police Chief; David Mineta, CEO, Momentum for Health; Daryl Savage, Human Relations Commission (former chair); John Shenk, CEO, Thoits Brothers; Kaloma Smith, Human Relations Commission Chair; and Shawny Williams, Vallejo Police Chief. Environmental Review This employment agreement is not a project for purposes of the California Environmental Quality Act and therefore no environmental review is required. Attachments: • Attachment5.a: Attachment A: Employment Agreement, Chief Binder 5 Packet Pg. 63 1 EMPLOYMENT AGREEMENT BETWEEN CITY OF PALO ALTO AND ANDREW BINDER THIS AGREEMENT is between the City of Palo Alto, a municipal corporation and chartered city (“City”) and Andrew Binder (“Binder”). It is effective on the latest date next to the signatures on the last page. This Agreement is entered into on the basis of the following facts: A. City, acting by and through its City Manager, wishes to employ Binder as its Police Chief, subject to the terms and conditions set forth in this Agreement, the Palo Alto Municipal Code and the Charter of the City of Palo Alto (the "Charter"). B. Under chapter 2.08 of the Palo Alto Municipal Code, the Police Chief is appointed by the City Manager with the approval of the City Council. Notwithstanding any provision of the City of Palo Alto Merit System Rules and Regulations, the Police Chief serves on an at-will basis, with no expectation of continued employment, and with no right to pre-or post-separation due process or appeal. C. Binder desires to be employed by the City as its Police Chief, subject to the terms and conditions in this Agreement, the Palo Alto Municipal Code, the Charter, the Palo Alto Merit System Rules and Regulations, and all other applicable laws, resolutions, and policies. D. The City and Binder wish to establish specific terms and conditions relating to compensation and benefits and related matters. BASED UPON THE FOREGOING, THE CITY AND BINDER AGREE AS FOLLOWS: 1. Employment. The City appoints Binder as its Police Chief for an indefinite term to begin on August 9, 2022 (“Employment Start Date”). Except as otherwise provided herein, Binder’s employment with the City shall be governed by the City Council-adopted Compensation Plan for Management and Professional Personnel and Council Appointees, as it currently exists and may be changed from time to time. 2. Duties of the Police Chief. Binder will perform the duties established for the Police Chief by the Palo Alto Municipal Code, by direction given by the City Manager, and as otherwise provided by law, ordinance, or regulation. Binder agrees to comply with all federal, state and local laws, ordinances, rules and regulations applicable to or associated with these duties. 2.1. Full Energy and Skill. Binder will devote his full energy, skill, ability, and productive time to the performance of his duties. 5.a Packet Pg. 64 2 2.2. No Conflict. Binder will not engage in any employment, activity, consulting service, or other enterprise, for compensation or otherwise, which is actually or potentially in conflict with or which interferes with the performance of his duties. Binder acknowledges that he is subject to the various conflict of interest requirements found in the California Government Code and state and local policies and regulations. 2.3 Permission Required For Outside Activities. Binder will not engage in any employment, activity, consulting service, or other enterprise, for compensation or not, without written permission of the City Manager. 3. Salary. While performing the duties of Police Chief, Binder will receive a base salary within the range provided in the City Council-approved Compensation Plan for Management and Professional Personnel and Council Appointees, as it currently exists and may be changed from time to time. Binder will receive an initial gross base annual salary of Two Hundred Ninety-Five Thousand Four Hundred and Eighty-Four Dollars ($295,484), beginning on the Employment Start Date, and subject to increases or changes approved by Council in the Compensation Plan for Management and Professional Personnel and Council Appointees. This amount is subject to authorized or required deductions and withholding, prorated and paid on City's regular paydays. Binder is an exempt employee under applicable wage and hour law and his base salary shall be compensation for all hours worked. The City agrees that the amount of Binder's base annual salary will not decrease, except as part of a permanent decrease that is consistent with the Fair Labor Standards Act. 4. Benefits, Allowances and Obligations. Binder will be eligible for, and shall receive, all regular benefits (i.e., health insurance, PERS contributions to the extent paid by the City, etc.) and vacation, sick leave, and management leave, as are generally provided to management employees under the City Council-approved Compensation Plan for Management and Professional Personnel and Council Appointees, as it currently exists and may be changed from time to time. In addition, Binder will assume all obligations and make all regular contributions (i.e., employee assumption of a portion of the employer PERS contribution) as are generally required of management employees under the City Council- approved Compensation Plan for Management and Professional Personnel and Council Appointees, as it currently exists and may be changed from time to time. 5. Additional Benefits and Allowances. In addition to the benefits specified in section 4, Binder will receive the following additional benefits and allowances: 5.1 Severance. If Binder is terminated or asked to resign, he shall, upon execution of a release of all claims against the City, be eligible for a severance payment equivalent to twelve (12) weeks of salary and benefits. The amount of the severance payment shall increase by twelve (12) weeks, to a total of twenty-four (24) weeks, on August 9, 2023. No severance shall be paid if Binder is terminated for serious misconduct involving abuse of his office or position, including, but not limited to, waste, fraud, violation of the law under color of authority, misappropriation of public resources, violence, harassment, or discrimination. If Binder is later convicted of a crime involving such abuse of his position, he shall fully reimburse the City as set forth in Government Code section 53243.3. 5.a Packet Pg. 65 3 5.2 Vacation Leave Upon Start of Employment. In recognition of his prior public service, Binder will be credited with vacation leave at the rate applicable to an employee with nineteen or more years of continuous service, currently a rate of 200 hours annually, prorated and credited according to the City’s normal procedures. 6. Duration of Employment. Binder understands and agrees that he has no constitutionally protected property or other interest in his employment as Police Chief. Binder waives any and all rights, if any, under the Merit System Rules and Regulations, including without limitation, the right to pre-or post- disciplinary due process. Binder understands and agrees that he works at the will and pleasure of the City Manager and that he may be terminated or asked to resign at any time, with or without cause. Binder may terminate this agreement (terminating all employment) upon 30 days written notice to the City Manager. 7. Miscellaneous. 7.1. Notices. Notices given under this Agreement shall be in writing and shall be either: a) served personally; or b) sent by Email (provided a hard copy is mailed within one (1) business day); or c) delivered by first-class United States mail, certified, with postage prepaid and a return receipt requested; or d) sent by Federal Express, or some equivalent private mail delivery service. Notices shall be deemed received at the earlier of actual receipt or three (3) days following deposit in the United States mail, postage prepaid. Notices shall be directed to the addresses shown below, provided that a party may change such party's address for notice by giving written notice to the other party in accordance with this subsection. CITY: Attn: City Manager 250 Hamilton Avenue Palo Alto, CA 94301 Phone: (650) 329-22280 Fax: (650) 328-3631 BINDER: Andrew Binder 250 Hamilton Avenue Palo Alto, CA 94301 7.2. Entire Agreement/ Amendment. This Agreement constitutes the entire understanding and agreement between the parties as to those matters contained in it, and supersedes any and all prior or contemporaneous agreements, representations and understandings of the parties. This Agreement may be amended at any time by mutual agreement of the parties, but any such amendment must be in writing, dated, and signed by the parties and attached hereto. 5.a Packet Pg. 66 4 7.3. Applicable Law and Venue. This Agreement shall be interpreted according to the laws of the State of California. Venue of any action regarding this Agreement shall be in the proper court in Santa Clara County. 7.4. Severability. In the event any portion of this Agreement is declared void, such portion shall be severed from this Agreement and the remaining provisions shall remain in effect, unless the result of such severance would be to substantially alter this Agreement or the obligations of the parties, in which case this Agreement shall be immediately terminated. 7.5. Waiver. Any failure of a party to insist upon strict compliance with any term, undertaking, or condition of this Agreement shall not be deemed to be a waiver of such term, undertaking, or condition. To be effective, a waiver must be in writing, signed and dated by the parties. 7.6. Representation by Counsel. Binder and the City acknowledge that they each did, or had the opportunity to, consult with legal counsel of their respective choices with respect to the matters that are the subject of this Agreement prior to executing it. 7.7. Section Headings. The headings on each of the sections and subsections of this Agreement are for the convenience of the parties only and do not limit or expand the contents of any such section or subsection. BINDER CITY OF PALO ALTO Andrew Binder City Manager Date: Date: Approved as to Form: Chief Assistant City Attorney 5.a Packet Pg. 67 City of Palo Alto (ID # 14446) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Action Items City of Palo Alto Page 1 Title: Adoption of an Ordinance Approving the Police Department's Military Equipment Use Policy Under AB 481 From: City Manager Lead Department: Police Recommendation Staff recommends that the City Council adopt an ordinance (Attachment A) approving the Palo Alto Police Department Military Equipment Use Policy in accordance with AB 481. Background Assembly Bill 481 (Attachment B) was adopted by the California Legislature and approved by Governor Gavin Newsom in September 2021. It went into effect on January 1, 2022. AB 481 is designed to increase community awareness and oversight over the possession and use by local police departments of certain types of equipment that AB 481 labels as “military” equipment. It requires the City Council to provide both authorization and oversight of the equipment used. The law, codified in California Government Code sections 7070 through 7075, requires law enforcement agencies to produce a military equipment use policy that identifies and describes: each type of military equipment; its authorized use; fiscal impact; rules/laws that govern use of such equipment; training required; and mechanisms to ensure compliance with the policy. (See Gov. Code section 7070(d)). The City Council is required to approve the policy for the Department to continue using this equipment. Additionally, the law requires an annual report and annual review by the governing body for continued use of the equipment. AB 481 requires every local law enforcement agency in California to post its proposed military equipment use policy no later than May 1, 2022. The law also requires at least a 30-day period for public comment on the proposed policy before the governing body discusses the proposed policy in a public meeting. Police agencies across the state have developed similar policies to comply with this new law. The Department’s proposed policy describes the equipment that has already been in the Department’s possession. The Department does not anticipate adding any new equipment. The Department does not possess any equipment that is atypical for the region. Palo Alto possesses fewer types of this equipment than many other Bay Area agencies. Discussion 6 Packet Pg. 68 City of Palo Alto Page 2 Staff recommends that the City Council adopt the attached ordinance approving the proposed Military Equipment Use Policy to ensure that the Palo Alto Police Department will continue to have access to each of its existing pieces of qualifying equipment, and to affirm the corresponding policies and procedures applicable to maintenance and use of the equipment. On April 28, 2022, the Police Department launched a new web page (viewable at www.cityofpaloalto.org/PAPDequipment ) dedicated to AB 481. This web page includes a link to a Medium article posted by the City on the same day explaining the new law, a link to the proposed policy, and a web form to collect community input about the draft proposed policy. Since the web page launched on April 28, 2022, the Police Department has received one response from the community via the web form. The response is attached (Attachment C). AB 481 defines the term “military equipment” to include many pieces of equipment that are designed exclusively for, and commonly used by, local law enforcement agencies throughout the United States. While the Palo Alto Police Department possesses some equipment as defined by AB 481, the types of equipment possessed by the Palo Alto Police Department have been possessed for years (in some cases decades) and are all designed specifically for a law enforcement (not military) application. Under AB 481, military equipment is defined as: drones and robots; command and control vehicles; military-grade vehicles for breaching (Mine Resistant Ambush Protected vehicles (MRAP) and Humvees); vehicles propelled by tracks; weaponized aircraft, vessels, or vehicles; explosive rams, slugs, or breaching devices; any .50 caliber or larger weapon or ammunition; any firearm or firearm accessory that is designed to launch explosive projectiles; “flashbang” grenades and explosive breaching tools, “tear gas,” and “pepperballs”; Taser Shockwave, microwave weapons, water cannons, and the Long Range Acoustic Device (LRAD); 40mm projectile launchers, “bean bag,” rubber bullet, and specialty impact munition (SIM) weapons; any other equipment as determined by a governing body or a state agency to require additional oversight. (See Gov. Code section 7070(c)). For each type of qualifying equipment possessed by the Palo Alto Police Department, the possession and use of that equipment was already governed by applicable Department policy, various statutes, and state and federal case law before the state enacted AB 481. Personnel of the Palo Alto Police Department meet or exceed all California Peace Officer Standards & Training (POST) training requirements that apply to the qualifying equipment. In addition, many of the pieces of qualifying equipment possessed by the Palo Alto Police Department are specifically designed for the safe resolution of critical incidents, as opposed to everyday routine patrol deployment; as such, some are used exclusively by members of the specially-trained PAPD Crisis Response Unit (which includes the Special Weapons & Tactics Team and the Crisis Negotiation Team), who receive additional specialized training in the use of the equipment. The proposed policy outlines all qualifying equipment possessed by the Department in Section “G” on page 4 of the policy. Several pieces of qualifying equipment are designed to support community safety and criminal apprehension by: 6 Packet Pg. 69 City of Palo Alto Page 3 • Alternatives to the use of deadly force, such as less-lethal munitions and chemical agents available to properly certified and/or trained sworn officers to provide less-lethal force options to safely effectuate arrests of criminal suspects in limited situations. • Means of de-escalation, such as the long-range acoustic device intended to send messages to facilitate communications with subjects from a safe distance. • Means of gathering information without jeopardizing the safety of officers, bystanders, and criminal suspects, such as an unmanned aerial vehicle or robot, neither of which are possessed by the Palo Alto Police Department but that may be used by a partner law enforcement agency to safely resolve a critical incident during a mutual aid event. • Command and control vehicle (the Mobile Emergency Operations Center, or MEOC) which serves as a mobile command post at critical incidents, disasters, or special events, as well as a backup 9–1–1 dispatch center in the event the City’s main dispatch center is compromised or unavailable; (the MEOC is most typically operated by the City’s Office of Emergency Services). • Diversionary devices, used exclusively by members of the Department’s SWAT team who have received specialized additional training; the equipment creates an auditory and visual diversion to facilitate the operation of tactical teams during a critical public safety incident. • One sniper rifle with associated ammunition, used exclusively by members of the Department’s SWAT team who have received specialized additional training. While not covered by AB 481, all properly trained patrol officers carry standard-issue AR-15 patrol rifles that are carried locked in patrol vehicles. In both cases, rifles allow sworn officers to address threats with greater precision at a greater distance. Per state law, the Police Department will release a public report annually to discuss any actual deployments or use of the equipment, gain public input on the report, and obtain authorization from the City Council to continue its use. AB 481 requires the City Council to consider the proposed military equipment use policy and make the following findings in approving the policy: 1. The military equipment is necessary because there is no reasonable alternative that can achieve the same objective of officer and civilian safety. 2. The proposed military equipment use policy will safeguard the public’s welfare, safety, civil rights, and civil liberties. 3. If purchasing the equipment, the equipment is reasonably cost effective compared to available alternatives that can achieve the same objective of officer and civilian safety. 4. Prior military equipment use complied with the military equipment use policy that was in effect at the time, or if prior uses did not comply with the accompanying military 6 Packet Pg. 70 City of Palo Alto Page 4 equipment use policy, corrective action has been taken to remedy nonconforming u ses and ensure future compliance. (See Gov. Code section 7071(d)(1)). Should the Council desire to approve the policy, these findings are made in the attached ordinance. Stakeholder Engagement The Department and the City Manager’s Communications Office collaborated on public communications about this proposed policy. In addition to the dedicated webpage on this topic, and a blog post issued, information was shared via the City’s homepage news, and distributed through the City and Police Department’s social media channels, Uplift Local digital newsletter. The community input portal has been active since April 28, 2022 and will continue to be a place for the community to comment. To date, the Police Department has received one response from the community via the web form (Attachment C). Policy Implications With Council approval of the proposed policy, the Police Department will continue to have access to each of its existing pieces of qualifying equipment, and the corresponding policies and procedures surrounding the use of the equipment will remain in effect. Resource Impact There are no budget implications resulting from the a doption of this policy. Staff time will be required to prepare the annual report, which will occur within regularly assigned duties. Environmental Review Adoption of an ordinance approving a military equipment use policy is not a “project” within the meaning of CEQA. Attachments • Attachment A: Ordinance Approving City’s Military Equipment Use Policy • Attachment B: Assembly Bill 481 • Attachment C: Public Input for Proposed Policy on AB 481 Attachments: • Attachment6.a: Attachment A: Ordinance Approving City's Military Equipment Use Policy • Attachment6.b: Attachment B: Assembly Bill 481 • Attachment6.c: Attachment C AB481 comment 5-6-2022 6 Packet Pg. 71 *NOT YET APPROVED* 1 257_20220725_ts24 Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Implementing AB 481 (2021) by Approving a Military Equipment Use Policy The Council of the City of Palo Alto ORDAINS as follows: SECTION 1. Findings and declarations. The City Council finds and declares as follows: 1. In 2021, the California Legislature and the Governor approved AB 481, which requires the City Council to approve a “Military Equipment Use Policy” in order to acquire, use, or seek funds for the use of certain equipment used by law enforcement. AB 481 is codified at Gov. Code section 7070 et seq. 2. The Palo Alto Police Department posted the proposed policy on its website on April 28, 2022 in compliance with Gov. Code section 7071. 3. The policy is attached to this ordinance as Exhibit A and is fully incorporated into this Ordinance. 4. The City Council now seeks to approve the attached Military Equipment Use Policy in compliance with AB 481. SECTION 2. The City Council makes the following required findings in compliance with AB 481 (now codified at Gov. Code section 7071(d)(1)) as to the attached Military Equipment Use Policy: (A) The military equipment is necessary because there is no reasonable alternative that can achieve the same objective of officer and civilian safety. (B) The proposed military equipment use policy will safeguard the public’s welfare, safety, civil rights, and civil liberties. (C) The equipment is reasonably cost effective compared to available alternatives that can achieve the same objective of officer and civilian safety. (D) Prior military equipment use complied with the military equipment use policy that was in effect at the time, or if prior uses did not comply with the accompanying military equipment use policy, corrective action has been taken to remedy nonconforming uses and ensure future compliance. SECTION 3. The City Council hereby approves the attached Military Equipment Use Policy incorporated as Exhibit A to 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. 6.a Packet Pg. 72 *NOT YET APPROVED* 2 257_20220725_ts24 SECTION 5. The Council finds that adoption of this Ordinance is not a “project” within the meaning of CEQA. SECTION 6. This Ordinance shall be effective on the thirty-first date after the date of its adoption. SECTION 7. This Ordinance shall be uncodified. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: NOT PARTICIPATING: ATTEST: ____________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ____________________________ ____________________________ Assistant City Attorney City Manager ____________________________ Chief of Police 6.a Packet Pg. 73 PAPD Military Equipment Use Policy    Page 1 of 10  Palo Alto Police Department Military Equipment Use Policy  PURPOSE  This policy is provided to fulfill the obligations set forth in Assembly Bill No. 481 and establishes  guidelines for the acquisition, funding, use and reporting of “military equipment”, as the term is  defined in Government Code section 7070. These obligations include but are not limited to  seeking approval on specific items deemed, by statute, to be military equipment and  requirements related to compliance, annual reporting, cataloging, and complaints regarding  these items.   PROCEDURE   A.   DEFINITIONS     1. Governing Body – The City Council of the City of Palo Alto. 2. Military Equipment – Shall have the same meaning as defined by California Government Code § 7070(c).    B.   GOVERNING BODY APPROVAL  1. The Department shall obtain approval of the governing body prior to engaging in any of the following activities:  a. Requesting military equipment made available pursuant to Section 2576a of Title 10 of the United States Code.   b. Seeking funds for military equipment including, but not limited to, applying for a grant, soliciting or accepting private, local, state, or federal funds, in‐kind donations, or other  donations or transfers.   c. Acquiring military equipment either permanently or temporarily, including by borrowing or leasing.   d. Collaborating with another law enforcement agency in the deployment or other use of military equipment within the territorial jurisdiction of the governing body.  e. Using any new or existing military equipment for a purpose, in a manner, or by a person not previously approved by the governing body pursuant to general order  f. Soliciting or responding to a proposal for, or entering into an agreement with, any other person or entity to seek funds for, apply to receive, acquire, use, or collaborate in the use  of, military equipment.   g. Acquiring military equipment through any means not provided in a. through f. 2. In seeking the approval of the governing body, the Department shall comply with Gov. Code § 7071, which requires that the Department submit a proposed military equipment use policy, or subsequent amendments, to the City Council and the public via the law enforcement  Exhibit A6.a Packet Pg. 74 PAPD Military Equipment Use Policy                                                                                  Page 2 of 10    agency’s internet website at least 30 days prior to any public hearing concerning the military  equipment at issue.     3. The governing body must be able to make the following findings in approving the Military  Equipment Use Policy as required by Gov. Code § 7071(d)(1) in order to use military equipment:     a. The military equipment is necessary because there is no reasonable alternative that can  achieve the same objective of officer and civilian safety.  b. The proposed military equipment use policy will safeguard the public’s welfare, safety,  civil rights, and civil liberties.  c. If purchasing the equipment, the equipment is reasonably cost effective compared to  available alternatives that can achieve the same objective of officer and civilian safety.  d. Prior military equipment use complied with the military equipment use policy that was  in effect at the time, or if prior uses did not comply with the accompanying military  equipment use policy, corrective action has been taken to remedy nonconforming uses  and ensure future compliance.    C.   MILITARY EQUIPMENT ANNUAL REPORT    The Department shall submit an annual military equipment report to the governing body that  addresses each type of military equipment possessed by the Department in compliance with  Gov. Code § 7072.     1. The Department shall also make each annual military equipment report publicly available on  its internet website for as long as the military equipment is available for use.     2. The annual military equipment report shall, at a minimum, include the following information  for the immediately preceding calendar year for each type of military equipment:   a. A summary of how the military equipment was used and the purpose of its use.   b. A summary of any complaints or concerns received concerning the military  equipment.   c. The results of any internal audits, any information about violations of the military   equipment use policy, and any actions taken in response.  d. The total annual cost for each type of military equipment, including acquisition,  personnel, training, transportation, maintenance, storage, upgrade, and other ongoing costs,  and from what source funds will be provided for the military equipment in the calendar year  following submission of the annual military equipment report.   e. The quantity possessed for each type of military equipment.   f. If the Department intends to acquire additional military equipment in the next year,  the quantity sought for each type of military equipment.     6.a Packet Pg. 75 PAPD Military Equipment Use Policy                                                                                  Page 3 of 10    The Department will document each use of military equipment and, via administrative review,  ensure compliance with this policy.  Any instances of non‐compliance will be reported to the  City Council via the annual military equipment report, and to the Independent Police Auditor  where appropriate.      D.    MILITARY EQUIPMENT USE POLICY COMPLAINTS AND CONCERNS     Pursuant to Gov. Code § 7070(d)(7), members of the public may register complaints or concerns  or submit questions by any of the following means:    1. Via web form available at www.cityofpaloalto.org/PAPDequipment  2. Via phone call to: (650) 329‐2406  3. Via mail sent to:  Palo Alto Police Department  Attn: Personnel and Training  275 Forest Avenue  Palo Alto, CA 94301  The Department is committed to responding to complaints, concerns and/or questions received  through any of the above methods in a timely manner.     E.   MILITARY EQUIPMENT TRAINING     Military equipment shall only be used after applicable training, including any course required by  the Commission on Peace Officer Standards and Training (P.O.S.T.), has been completed, unless  exigent circumstances arise.     F.   MILITARY USE EQUIPMENT POLICY CONTENTS      All military use equipment kept and maintained by the Department shall be cataloged in a way  which addresses each of the following requirements in compliance with Gov. Code § 7070(d):     1. A description of each type of military equipment, the quantity sought, its capabilities,  expected lifespan, and product descriptions from the manufacturer of the military  equipment.  2. The purposes and authorized uses for which the law enforcement agency or the state  agency proposes to use each type of military equipment.  3. The fiscal impact of each type of military equipment, including the initial costs of obtaining  the equipment and estimated annual costs of maintaining the equipment.  4. The legal and procedural rules that govern each authorized use.  5. The training, including any course required by the Commission on Peace Officer Standards  and Training, that must be completed before any officer, agent, or employee of the law  enforcement agency or the state agency is allowed to use each specific type of military  6.a Packet Pg. 76 PAPD Military Equipment Use Policy                                                                                  Page 4 of 10    equipment to ensure the full protection of the public’s welfare, safety, civil rights, and civil  liberties and full adherence to the military equipment use policy.  6. The mechanisms to ensure compliance with the military equipment use policy, including  which independent persons or entities have oversight authority, and, if applicable, what  legally enforceable sanctions are put in place for violations of the policy.    G.  USE POLICY FOR SPECIFIC EQUIPMENT    Qualifying Equipment Owned/Utilized by the Department    Equipment Type: 37mm Less Lethal Launchers and Kinetic Energy Munitions ‐ CA Gov’t Code  §7070(c)(14)  Quantity Owned/Sought:  30 owned  Lifespan: Approximately 15 years  Equipment Capabilities: The 37MM Less Lethal Launcher is capable of firing 37MM Kinetic  Energy and Chemical Agent Munitions.  Palo Alto PD only possesses “KO1” impact baton  rounds in its inventory.  Manufacturer Product Description: Sage Control Ordinance 37MM launchers are rugged,  reliable, and simple to operate less lethal launchers.   These launchers are light weight,  versatile and used worldwide by police officers. The 37MM launcher family of products is  available in single‐shot (“Ace”), double‐shot (“Deuce”), or magazine fed configurations.   Palo  Alto PD possesses the “Ace” and “Deuce” models.  Purpose/Authorized Uses: The 37MM Less Lethal Launchers and Kinetic Energy Munitions  are intended for use as a less lethal use of force option.  Kinetic energy projectiles, when  used properly, are less likely to result in death or serious physical injury and can be used in an  attempt to de‐escalate a potentially deadly situation.  Circumstances appropriate for deployment include, but are not limited to, situations in  which:    (a) The suspect is armed with a weapon and the tactical circumstances allow for the safe  application of approved munitions.  (b) The suspect has made credible threats to harm him/herself or others.  (c) The suspect is engaged in riotous behavior or is throwing rocks, bottles or other  dangerous projectiles at people and/or officers.  (d) There is probable cause to believe that the suspect has already committed a crime of  violence and is refusing to comply with lawful orders.  Fiscal Impacts: The initial cost of this equipment was approximately $27,000.  The ongoing  costs for munitions will vary and maintenance is conducted by departmental staff.   Legal/Procedural Rules Governing Use: Use governed by applicable State, Federal and Local  law, and PAPD policy, including but not limited to PAPD policy §§ 300 (Use of Force) and 308  (Control Devices and Techniques).  Use will continue to be subject to an administrative Use of  Force review.    6.a Packet Pg. 77 PAPD Military Equipment Use Policy                                                                                  Page 5 of 10    Training Required: Officers must complete a department certified 37mm course as well as  regular training and qualifications as required by law and policy.   Other Notes: None.    Equipment Type: Long Range Acoustic Device (LRAD) ‐ CA Gov’t Code §7070(c)(13)  Quantity Owned/Sought: 1  Lifespan: Unknown.  Equipment Capabilities: LRAD systems are a type of Acoustic Hailing Device (AHD) used to  send messages over long distances. LRAD systems produce much higher sound levels  (volume) than normal loudspeakers or megaphones, and can be more narrowly directed.   Manufacturer Product Description: LRAD systems are a type of Acoustic Hailing Device (AHD)  used to send messages over long distances. LRAD systems produce much higher sound levels  (volume) than normal loudspeakers or megaphones. Over shorter distances, LRAD signals are  loud enough to cause pain in the ears of people in their path.  Purpose/Authorized Uses: Primarily used to communicate, from a safe distance, with armed  and/or barricaded subjects, for the purpose of negotiation.  Can also be used in furtherance  of search and rescue operations, and to communicate lawful dispersal orders.    Fiscal Impacts:   Legal/Procedural Rules Governing Use: Use governed by applicable State, Federal and Local  law, and PAPD policy, including but not limited to PAPD policy § 414 (Hostage and Barricade  Incidents).  Use will be subject to an administrative review.  Training Required:  The Palo Alto Police Department provides internal training for staff  members prior to allowing them to use this equipment.  Other Notes:  This equipment is maintained and operated by members of the Department’s  Crisis Negotiation Team (CNT).      Equipment Type: Diversionary Devices and Chemical Agents (tear gas) and pepper balls ‐ CA  Gov’t Code §7070(c)(12)  Quantity Owned/Sought: 108  Lifespan: 5 years  Equipment Capabilities: Capable of creating auditory/visual distractions, and/or deploying  tear gas or pepper chemical to distract potentially dangerous individuals.  Manufacturer Product Description:     The Palo Alto Police Department uses Diversionary Devices and Chemical Agents produced by  Defense Technology (DT) and Combined Tactical Systems (CTS).  All Chemical Agents utilized  by PAPD contain CS (Orthochlorobenzalmalononitrile) or OC (Oleoresin Capsicum).    Diversionary Devices:    1. Flash‐Bang (CTS‐7290)  a. The CTS 7290 is the standard for diversionary flash‐bang devices. The 7290  produces a 165‐180db and 6‐8 million candela of light output.    6.a Packet Pg. 78 PAPD Military Equipment Use Policy                                                                                  Page 6 of 10    2. Mini‐Bang (CTS‐7290M)  a. The Model 7290M Flash‐Bang exhibits all of the same attributes of its larger  counterpart but in a smaller and lighter package. Weighing in at just 15 ounces  the new 7290M is approximately 30% lighter than the 7290 but still has the  same 180db output of the 7290 and produces 6‐8 million candela of light.      Chemical Agents:    1. CS 37mm Liquid Ferret Barricade Round (CTS‐3330)  a. 3330 – Liquid CS filled projectile penetrates intermediate barriers and delivers  irritant agents into an adjacent room.  2. CS 37mm Liquid Ferret Barricade Round (DT‐1162)  a. The Ferret® 37 mm CS Round is a frangible projectile filled with chemical  agent. Upon impacting the barrier, the nose cone ruptures and  instantaneously delivers the .16 oz. agent payload inside a structure.   3. CS Flameless Tri‐Chamber (DT‐1032)  a. The design of the Tri‐Chamber Flameless CS Grenade allows the contents to  burn within an internal can and disperse the agent safely with reduced risk of  fire. The grenade is designed primarily for indoor tactical situations to detect  and/or dislodge a barricaded subject. This grenade will deliver approximately  .70 oz. of agent during its 20‐25 seconds burn time. The Tri‐Chamber  Flameless Grenade can be used in crowd control as well as tactical deployment  situations by Law Enforcement and Corrections, but was designed with the  barricade situation in mind.   4. CS Triple Chaser Separating Canister (DT‐1026)  a. The Triple‐Chaser® CS consists of three separate canisters pressed together  with separating charges between each. When deployed, the canisters separate  allowing increased area coverage in a short period of time. This grenade can  be hand thrown or launched from a fired delivery system.   5. CS Riot Control (DT‐1082)  a. The Riot Control CS Grenade is designed specifically for outdoor use in crowd  control situations with a high volume continuous burn. . This grenade can be  used to conceal tactical movement or to route a crowd. The volume of smoke  and agent is vast and obtrusive. .    Smoke:    1. Maximum HC (Hexachlorethane) Smoke (DT‐1073)  a. The Maximum Smoke Grenade is designed specifically for outdoor use in  crowd control situations with a high volume continuous burn. This grenade  can be used to conceal tactical movement or to route a crowd. The volume of  non‐irritant smoke and agent is vast and obtrusive.   Pepperball:    6.a Packet Pg. 79 PAPD Military Equipment Use Policy                                                                                  Page 7 of 10    Less lethal launchers are designed for minimum time between launches and quick reload  speed, so whether in a crowd control scenario, tactical or even Mobile Field Force situation,  the PepperBall system offers flexibility, safety and security, all within one platform.  Each  launcher is air powered, with either carbon dioxide (CO2), nitrogen, or compressed air  powering the launch of projectiles.   Purpose/Authorized Uses: creating explosive distractions, and/or deploying chemical agents.  Fiscal Impacts: The initial cost of the Pepperball equipment was approximately $7,920.  The  ongoing costs for munitions will vary and maintenance is conducted by departmental staff.   The initial cost of the distraction devices and chemical agents was approximately $2,400.  The  ongoing costs for munitions will vary and (minimal, if any) maintenance is conducted by  departmental staff.  Legal/Procedural Rules Governing Use Use governed by applicable State, Federal and Local  law, and PAPD policy, including but not limited to PAPD policy §§ 300 (Use of Force), 308  (Control Devices and Techniques), and 408 (Crisis Response Unit).Use of tear gas or pepper  balls will continue to be subject to an administrative Use of Force review.  Use of distraction  devices will be subject to an administrative review to ensure policy compliance.    Training Required: A P.O.S.T. certified Control Devices and Techniques Department chemical  agent   and distraction device instructor provides internal training for all members of the  SWAT team prior to allowing them to use flashbang grenades or tear gas.  The Department  provides internal training for all members prior to allowing them to use pepper balls.    Other Notes:  Distraction devices and chemical agents are exclusively maintained and  operated by members of the Department’s Special Weapons and Tactics Team (SWAT).      Equipment Type: Bolt Action Rifle and Ammunition ‐ CA Gov’t Code §7070(c)(10)  Quantity Owned/Sought:  1 owned  Lifespan: Approximately 15 years  Equipment Capabilities: Accuracy International rifle is capable of firing a 7.62mm/.308 cal  projectile bullet.  Manufacturer Product Description: Accuracy International (AI) Accuracy Tactical bolt action  rifle .308 Winchester/7.62mm NATO.  1. 20" barrel threaded 5/8x24  2. Nightforce:C622 Scope .250 MOA  3. AI Adjustable cheek piece  4. AI Two‐stage trigger  5. AI 10‐round .380 caliber magazine  6. AI Three‐position safety    Purpose/Authorized Uses: This rifle is authorized for use by a specially‐trained, SWAT  marksman only and may be deployed in any circumstance where the officer can articulate a  reasonable expectation that the rifle may be needed. Examples of some general guidelines  for deploying the rifle may include but are not limited to:   1. Situations where the officer reasonably anticipates an armed encounter.  6.a Packet Pg. 80 PAPD Military Equipment Use Policy                                                                                  Page 8 of 10    2. When the officer is faced with a situation that may require accurate and effective fire  at long range.  3. Situations where an officer reasonably expects the need to meet or exceed a  suspect's firepower.  4. When an officer reasonably believes that there may be a need to fire on a barricaded  person or a person with a hostage.  5. When an officer reasonably believes that a suspect may be wearing body armor.  6. When authorized or requested by a supervisor.  Fiscal Impacts: This equipment was purchased by the Palo Alto Police Department at an  initial cost of $6500.00. The ongoing costs for ammunition will vary and maintenance is  conducted by departmental staff.   Legal/Procedural Rules Governing Use: Use governed by applicable State, Federal and Local  law, and PAPD policy, including but not limited to PAPD policy §§ 300 (Use of Force), 312  (Firearms), and 408 (Crisis Response Unit).Each use will continue to be subject to an  administrative Use of Force review.     Training Required: In addition to CA P.O.S.T. certified patrol rifle and CA P.O.S.T. certified  standard SWAT Operator training, SWAT marksmen must successfully complete a CA P.O.S.T.  certified course as well as regular SWAT marksmanship training and qualifications as required  by law and policy.   Other Notes: The Palo Alto Police Department does not presently have an active‐duty SWAT  marksman among its staff, so there are no Palo Alto Police personnel presently authorized to  use this Military Equipment.      Qualifying Equipment Owned/Utilized by Palo Alto OES    Equipment Type: Command and control vehicle – CA Gov’t Code §7070(c)(5)  Quantity Owned/Sought: 1  Lifespan: Approximately 20 years  Equipment Capabilities:  The City of Palo Alto Office of Emergency Services (OES) has a  Mobile Emergency Operations Center (MEOC) vehicle.  Manufacturer Product Description: The MEOC is built on a 40’ Freightliner chassis, 2010  Model Year.  Purpose/Authorized Uses:  The MEOC serves as a resource for public safety and coordinates  with other such vehicles operated by other agencies.  It is deployed to “all hazards” ranging  from natural disasters, wildfires, crime, special events, and planned and unplanned  disruptions to 9‐1‐1 and Emergency Operations Center systems and facilities.  Fiscal Impacts:  The MEOC was acquired in approximately 2010 with grant funding of  $300,000 and City funding of $375,000.  The ongoing costs for maintenance and operation  will vary and most maintenance is conducted by City staff.  Legal/Procedural Rules Governing Use: It is the policy of OES to use the MEOC in accordance  with California State law regarding the operation of motor vehicles.  Furthermore, since the  MEOC is grant‐funded and since the MEOC is a rare resource, the City may support mutual  6.a Packet Pg. 81 PAPD Military Equipment Use Policy                                                                                  Page 9 of 10    aid with the MEOC (for example wildfire response).  Use will be subject to an administrative  review to ensure policy compliance.    Training Required: The MEOC is a highly complex system.  City staff are provided with  requisite training and licensing, depending on their role in supporting the MEOC.  Other Notes: The MEOC is not a “military vehicle” but could support coordination with the  National Guard, FEMA, and other cooperating agencies after a major earthquake or other  disaster.      Qualifying Equipment known to be owned and/or utilized by law enforcement units with which  the  Palo  Alto  Police  Department  collaborates  and/or  participates  for  law  enforcement  purposes    Equipment Type: Unmanned Aircraft Systems (UAS/Drones) – CA Gov’t Code §7070(c)(1)  Quantity Owned/Sought: None (outside owned)  Lifespan: Various  Equipment Capabilities: Remotely piloted aerial vehicles capable of providing live and  recorded video images captured from aerial positions, including images enhanced by Forward  Looking Infrared (FLIR) and optical zoom lenses.   Manufacturer Product Description: Various. Dependent upon the availability of mutual aid  equipment and personnel at the time of need.  Purpose/Authorized Uses: UAS/Drones may be utilized to enhance the Department’s mission  of protecting lives and property when other means and resources are not available or are less  effective.  Uses may include but are not limited to: search and rescue; suspect apprehension;  crime scene documentation; tactical operations; scene security; hazard monitoring,  identification and mitigation; response to emergency calls; crisis communications; legally  authorized surveillance.  Fiscal Impacts: None. Equipment owned, maintained, and operated by another agency.  Legal/Procedural Rules Governing Use: Use governed by applicable State, Federal and Local  law, Federal Aviation Administration (FAA) regulations, and PAPD policy, including but not  limited to PAPD policy §§ 322 (Search and Seizure) and 352 (Outside Agency  Assistance).Federal Aviation Administration (FAA) regulations . Absent a warrant or exigent  circumstances, operators and observers shall adhere to FAA altitude regulations and shall not  intentionally record or transmit images of any location where a person would have a  reasonable expectation of privacy (e.g., residence, yard, enclosure). Operators and observers  shall take reasonable precautions to avoid inadvertently recording or transmitting images of  areas where there is a reasonable expectation of privacy. Upon mutual aid or other request  from PAPD, UAS/Drone will be operated by the deploying agency’s staff pursuant to their  own policies and review.      Training Required: Prior to piloting any UAS/Drone staff members must secure an FAA  Remote Pilot License and complete all training required by our FAA COA.  Other Notes: None.      6.a Packet Pg. 82 PAPD Military Equipment Use Policy                                                                                  Page 10 of 10    Equipment Type: Unmanned, remotely piloted, powered ground vehicles ‐ CA Gov’t Code  §7070(c)(1)  Quantity Owned/Sought: None (outside owned) Lifespan: Various  Equipment Capabilities: Robots are capable of being remotely navigated to provide scene  information and intelligence in the form of video and still images transmitted to first  responders.   Manufacturer Product Description: Various. Dependent upon the availability of mutual aid  equipment and personnel at the time of need.  Purpose/Authorized Uses: To enhance the safety of potentially dangerous situations by  providing first responders with the ability to capture video and still images of hazardous  areas prior to, or in lieu of, sending in personnel.  Fiscal Impacts: None. Equipment owned, maintained, and operated by another agency.  Legal/Procedural Rules Governing Use: Absent a warrant or exigent circumstances,  operators and observers shall adhere to all applicable privacy laws and shall not intentionally  record or transmit images of any location where a person would have a reasonable  expectation of privacy (e.g., residence, yard, enclosure).  Use governed by applicable State,  Federal and Local law, Federal Aviation Administration (FAA) regulations, and PAPD policy,  including but not limited to PAPD policy §§ 322 (Search and Seizure) and 352 (Outside Agency  Assistance).  Upon mutual aid or other request from PAPD, vehicle will be operated by  deploying agency’s staff pursuant to their own policies and review.   Training Required: Subject to the policies of the deploying agency.  Other Notes:  While the Palo Alto Police Department does not own or operate this  equipment, it could be deployed to an incident within city limits.    Equipment Type: Wheeled vehicles that have a breaching apparatus attached ‐ CA Gov’t  Code §7070(c)(3)  Quantity Owned/Sought: None (outside owned) Lifespan: Various  Equipment Capabilities: Capable of breaching doors, gates, and other points of entry;  facilitating the safe transport of officers or civilians facing an armed suspect.   Manufacturer Product Description: Various. Dependent upon the availability of mutual aid  equipment and personnel at the time of need.  Purpose/Authorized Uses: Breaching doors, gates, and other points of entry.  Safely  transporting police personnel or evacuating civilians, when facing with an armed suspect.   Fiscal Impacts: None. Equipment owned, maintained, and operated by another agency.  Legal/Procedural Rules Governing Use: Use governed by applicable State, Federal and Local  law, and PAPD policy, including but not limited to PAPD policy §§ 322 (Search and Seizure)  and 352 (Outside Agency Assistance).  Upon mutual aid or other request from PAPD, vehicle  will be operated by deploying agency’s staff pursuant to their own policies and review.  Training Required: Subject to the policies of the deploying agency.  Other Notes:  While the Palo Alto Police Department does not own or operate this  equipment, it could be deployed to an incident within city limits.    6.a Packet Pg. 83 Assembly Bill No. 481 CHAPTER 406 An act to add Chapter 12.8 (commencing with Section 7070) to Division 7 of Title 1 of the Government Code, relating to military equipment. [Approved by Governor September 30, 2021. Filed with Secretary of State September 30, 2021.] legislative counsel’s digest AB 481, Chiu. Law enforcement and state agencies: military equipment: funding, acquisition, and use. Existing law designates the Department of General Services as the agency for the State of California responsible for distribution of federal surplus personal property, excepting food commodities, and requires the department to, among other things, do all things necessary to the execution of its powers and duties as the state agency for the distribution of federal personal surplus property, excepting food commodities, in accordance with specified federal law. Existing law, the Federal Surplus Property Acquisition Law of 1945, authorizes a local agency, as defined, to acquire surplus federal property without regard to any law which requires posting of notices or advertising for bids, inviting or receiving bids, or delivery of purchases before payment, or which prevents the local agency from bidding on federal surplus property. Existing federal law authorizes the Department of Defense to transfer surplus personal property, including arms and ammunition, to federal or state agencies for use in law enforcement activities, subject to specified conditions, at no cost to the acquiring agency. This bill would require a law enforcement agency, defined to include specified entities, to obtain approval of the applicable governing body, by adoption of a military equipment use policy, as specified, by ordinance at a regular meeting held pursuant to specified open meeting laws, prior to taking certain actions relating to the funding, acquisition, or use of military equipment, as defined. The bill would also require similar approval for the continued use of military equipment acquired prior to January 1, 2022. The bill would allow the governing body to approve the funding, acquisition, or use of military equipment within its jurisdiction only if it determines that the military equipment meets specified standards. The bill would require the governing body to annually review the ordinance and to either disapprove a renewal of the authorization for a type, as defined, of military equipment or amend the military equipment use policy if it determines, based on an annual military equipment report prepared by the law enforcement agency, as provided, that the military equipment does not comply with the above-described standards for approval. The bill would specify these provisions do not preclude a county or local municipality from implementing 92 6.b Packet Pg. 84 additional requirements and standards related to the purchase, use, and reporting of military equipment by local law enforcement agencies. This bill would also require a state agency, as defined, to create a military equipment use policy before engaging in certain activities, publish the policy on the agency’s internet website, and provide a copy of the policy to the Governor or the Governor’s designee, as specified. The bill would also require a state agency that seeks to continue use of military equipment acquired prior to January 1, 2022, to create a military equipment use policy. This bill would also include findings that the changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities. By adding to the duties of local officials with respect to the funding, acquisition, and use of military equipment, this bill would impose a state-mandated local program. The California Constitution requires local agencies, for the purpose of ensuring public access to the meetings of public bodies and the writings of public officials and agencies, to comply with a statutory enactment that amends or enacts laws relating to public records or open meetings and contains findings demonstrating that the enactment furthers the constitutional requirements relating to this purpose. This bill would make legislative findings to that effect. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. The people of the State of California do enact as follows: SECTION 1. The Legislature finds and declares all of the following: (a)  The acquisition of military equipment and its deployment in our communities adversely impacts the public’s safety and welfare, including increased risk of civilian deaths, significant risks to civil rights, civil liberties, and physical and psychological well-being, and incurment of significant financial costs. Military equipment is more frequently deployed in low-income Black and Brown communities, meaning the risks and impacts of police militarization are experienced most acutely in marginalized communities. (b)  The public has a right to know about any funding, acquisition, or use of military equipment by state or local government officials, as well as a right to participate in any government agency’s decision to fund, acquire, or use such equipment. (c)  Decisions regarding whether and how military equipment is funded, acquired, or used should give strong consideration to the public’s welfare, safety, civil rights, and civil liberties, and should be based on meaningful public input. 92 — 2 — Ch. 406 6.b Packet Pg. 85 (d)  Legally enforceable safeguards, including transparency, oversight, and accountability measures, must be in place to protect the public’s welfare, safety, civil rights, and civil liberties before military equipment is funded, acquired, or used. (e)  The lack of a public forum to discuss the acquisition of military equipment jeopardizes the relationship police have with the community, which can be undermined when law enforcement is seen as an occupying force rather than a public safety service. SEC. 2. Chapter 12.8 (commencing with Section 7070) is added to Division 7 of Title 1 of the Government Code, to read: Chapter 12.8. Funding, Acquisition, and Use of Military Equipment 7070. For purposes of this chapter, the following definitions shall apply: (a)  “Governing body” means the elected body that oversees a law enforcement agency or, if there is no elected body that directly oversees the law enforcement agency, the appointed body that oversees a law enforcement agency. In the case of a law enforcement agency of a county, including a sheriff ’s department or a district attorney’s office, “governing body” means the board of supervisors of the county. (b)  “Law enforcement agency” means any of the following: (1)  A police department, including the police department of a transit agency, school district, or any campus of the University of California, the California State University, or California Community Colleges. (2)  A sheriff ’s department. (3)  A district attorney’s office. (4)  A county probation department. (c)  “Military equipment” means the following: (1)  Unmanned, remotely piloted, powered aerial or ground vehicles. (2)  Mine-resistant ambush-protected (MRAP) vehicles or armored personnel carriers. However, police versions of standard consumer vehicles are specifically excluded from this subdivision. (3)  High mobility multipurpose wheeled vehicles (HMMWV), commonly referred to as Humvees, two and one-half-ton trucks, five-ton trucks, or wheeled vehicles that have a breaching or entry apparatus attached. However, unarmored all-terrain vehicles (ATVs) and motorized dirt bikes are specifically excluded from this subdivision. (4)  Tracked armored vehicles that provide ballistic protection to their occupants and utilize a tracked system instead of wheels for forward motion. (5)  Command and control vehicles that are either built or modified to facilitate the operational control and direction of public safety units. (6)  Weaponized aircraft, vessels, or vehicles of any kind. (7)  Battering rams, slugs, and breaching apparatuses that are explosive in nature. However, items designed to remove a lock, such as bolt cutters, 92 Ch. 406 — 3 — 6.b Packet Pg. 86 or a handheld ram designed to be operated by one person, are specifically excluded from this subdivision. (8)  Firearms of .50 caliber or greater. However, standard issue shotguns are specifically excluded from this subdivision. (9)  Ammunition of .50 caliber or greater. However, standard issue shotgun ammunition is specifically excluded from this subdivision. (10)  Specialized firearms and ammunition of less than .50 caliber, including assault weapons as defined in Sections 30510 and 30515 of the Penal Code, with the exception of standard issue service weapons and ammunition of less than .50 caliber that are issued to officers, agents, or employees of a law enforcement agency or a state agency. (11)  Any firearm or firearm accessory that is designed to launch explosive projectiles. (12)  “Flashbang” grenades and explosive breaching tools, “tear gas,” and “pepper balls,” excluding standard, service-issued handheld pepper spray. (13)  Taser Shockwave, microwave weapons, water cannons, and the Long Range Acoustic Device (LRAD). (14)  The following projectile launch platforms and their associated munitions: 40mm projectile launchers, “bean bag,” rubber bullet, and specialty impact munition (SIM) weapons. (15)  Any other equipment as determined by a governing body or a state agency to require additional oversight. (16)  Notwithstanding paragraphs (1) through (15), “military equipment” does not include general equipment not designated as prohibited or controlled by the federal Defense Logistics Agency. (d)  “Military equipment use policy” means a publicly released, written document governing the use of military equipment by a law enforcement agency or a state agency that addresses, at a minimum, all of the following: (1)  A description of each type of military equipment, the quantity sought, its capabilities, expected lifespan, and product descriptions from the manufacturer of the military equipment. (2)  The purposes and authorized uses for which the law enforcement agency or the state agency proposes to use each type of military equipment. (3)  The fiscal impact of each type of military equipment, including the initial costs of obtaining the equipment and estimated annual costs of maintaining the equipment. (4)  The legal and procedural rules that govern each authorized use. (5)  The training, including any course required by the Commission on Peace Officer Standards and Training, that must be completed before any officer, agent, or employee of the law enforcement agency or the state agency is allowed to use each specific type of military equipment to ensure the full protection of the public’s welfare, safety, civil rights, and civil liberties and full adherence to the military equipment use policy. (6)  The mechanisms to ensure compliance with the military equipment use policy, including which independent persons or entities have oversight 92 — 4 — Ch. 406 6.b Packet Pg. 87 authority, and, if applicable, what legally enforceable sanctions are put in place for violations of the policy. (7)  For a law enforcement agency, the procedures by which members of the public may register complaints or concerns or submit questions about the use of each specific type of military equipment, and how the law enforcement agency will ensure that each complaint, concern, or question receives a response in a timely manner. (e)  “State agency” means the law enforcement division of every state office, officer, department, division, bureau, board, and commission or other state body or agency, except those agencies provided for in Article IV (except Section 20 thereof) or Article VI of the California Constitution. (f)  “Type” means each item that shares the same manufacturer model number. 7071. (a)  (1)  A law enforcement agency shall obtain approval of the governing body, by an ordinance adopting a military equipment use policy at a regular meeting of the governing body held pursuant to the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2) or the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5), as applicable, prior to engaging in any of the following: (A)  Requesting military equipment made available pursuant to Section 2576a of Title 10 of the United States Code. (B)  Seeking funds for military equipment, including, but not limited to, applying for a grant, soliciting or accepting private, local, state, or federal funds, in-kind donations, or other donations or transfers. (C)  Acquiring military equipment either permanently or temporarily, including by borrowing or leasing. (D)  Collaborating with another law enforcement agency in the deployment or other use of military equipment within the territorial jurisdiction of the governing body. (E)  Using any new or existing military equipment for a purpose, in a manner, or by a person not previously approved by the governing body pursuant to this chapter. (F)  Soliciting or responding to a proposal for, or entering into an agreement with, any other person or entity to seek funds for, apply to receive, acquire, use, or collaborate in the use of, military equipment. (G)  Acquiring military equipment through any means not provided by this paragraph. (2)  No later than May 1, 2022, a law enforcement agency seeking to continue the use of any military equipment that was acquired prior to January 1, 2022, shall commence a governing body approval process in accordance with this section. If the governing body does not approve the continuing use of military equipment, including by adoption pursuant to this subdivision of a military equipment use policy submitted pursuant to subdivision (b), within 180 days of submission of the proposed military equipment use policy to the governing body, the law enforcement agency shall cease its use of 92 Ch. 406 — 5 — 6.b Packet Pg. 88 the military equipment until it receives the approval of the governing body in accordance with this section. (b)  In seeking the approval of the governing body pursuant to subdivision (a), a law enforcement agency shall submit a proposed military equipment use policy to the governing body and make those documents available on the law enforcement agency’s internet website at least 30 days prior to any public hearing concerning the military equipment at issue. (c)  The governing body shall consider a proposed military equipment use policy as an agenda item for an open session of a regular meeting and provide for public comment in accordance with the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2) or the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5), as applicable. (d)  (1)  The governing body shall only approve a military equipment use policy pursuant to this chapter if it determines all of the following: (A)  The military equipment is necessary because there is no reasonable alternative that can achieve the same objective of officer and civilian safety. (B)  The proposed military equipment use policy will safeguard the public’s welfare, safety, civil rights, and civil liberties. (C)  If purchasing the equipment, the equipment is reasonably cost effective compared to available alternatives that can achieve the same objective of officer and civilian safety. (D)  Prior military equipment use complied with the military equipment use policy that was in effect at the time, or if prior uses did not comply with the accompanying military equipment use policy, corrective action has been taken to remedy nonconforming uses and ensure future compliance. (2)  In order to facilitate public participation, any proposed or final military equipment use policy shall be made publicly available on the internet website of the relevant law enforcement agency for as long as the military equipment is available for use. (e)  (1)  The governing body shall review any ordinance that it has adopted pursuant to this section approving the funding, acquisition, or use of military equipment at least annually and, subject to paragraph (2), vote on whether to renew the ordinance at a regular meeting held pursuant to the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2) or the Ralph M. Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of Division 2 of Title 5), as applicable. (2)  The governing body shall determine, based on the annual military equipment report submitted pursuant to Section 7072, whether each type of military equipment identified in that report has complied with the standards for approval set forth in subdivision (d). If the governing body determines that a type of military equipment identified in that annual military equipment report has not complied with the standards for approval set forth in subdivision (d), the governing body shall either disapprove a renewal of the authorization for that type of military equipment or require modifications 92 — 6 — Ch. 406 6.b Packet Pg. 89 to the military equipment use policy in a manner that will resolve the lack of compliance. (f)  Notwithstanding subdivisions (a) to (e), inclusive, if a city contracts with another entity for law enforcement services, the city shall have the authority to adopt a military equipment use policy based on local community needs. 7072. (a)  A law enforcement agency that receives approval for a military equipment use policy pursuant to Section 7071 shall submit to the governing body an annual military equipment report for each type of military equipment approved by the governing body within one year of approval, and annually thereafter for as long as the military equipment is available for use. The law enforcement agency shall also make each annual military equipment report required by this section publicly available on its internet website for as long as the military equipment is available for use. The annual military equipment report shall, at a minimum, include the following information for the immediately preceding calendar year for each type of military equipment: (1)  A summary of how the military equipment was used and the purpose of its use. (2)  A summary of any complaints or concerns received concerning the military equipment. (3)  The results of any internal audits, any information about violations of the military equipment use policy, and any actions taken in response. (4)  The total annual cost for each type of military equipment, including acquisition, personnel, training, transportation, maintenance, storage, upgrade, and other ongoing costs, and from what source funds will be provided for the military equipment in the calendar year following submission of the annual military equipment report. (5)  The quantity possessed for each type of military equipment. (6)  If the law enforcement agency intends to acquire additional military equipment in the next year, the quantity sought for each type of military equipment. (b)  Within 30 days of submitting and publicly releasing an annual military equipment report pursuant to this section, the law enforcement agency shall hold at least one well-publicized and conveniently located community engagement meeting, at which the general public may discuss and ask questions regarding the annual military equipment report and the law enforcement agency’s funding, acquisition, or use of military equipment. 7073. (a)  A state agency shall create a military equipment use policy prior to engaging in any of the following: (1)  Requesting military equipment made available pursuant to Section 2576a of Title 10 of the United States Code. (2)  Seeking funds for military equipment, including, but not limited to, applying for a grant, soliciting or accepting private, local, state, or federal funds, in-kind donations, or other donations or transfers. (3)  Acquiring military equipment either permanently or temporarily, including by borrowing or leasing. 92 Ch. 406 — 7 — 6.b Packet Pg. 90 (4)  Collaborating with a law enforcement agency or another state agency in the deployment or other use of military equipment within the territorial jurisdiction of the governing body. (5)  Using any new or existing military equipment for a purpose, in a manner, or by a person not previously approved by the governing body pursuant to this chapter. (6)  Soliciting or responding to a proposal for, or entering into an agreement with, any other person or entity to seek funds for, or to apply to receive, acquire, use, or collaborate in the use of, military equipment. (7)  Acquiring military equipment through any means not provided by this subdivision. (b)  No later than May 1, 2022, a state agency seeking to continue the use of any military equipment that was acquired prior to January 1, 2022, shall create a military equipment use policy. (c)  A state agency that is required to create a military equipment use policy pursuant to this section shall do both of the following within 180 days of completing the policy: (1)  Publish the military equipment use policy on the agency’s internet website. (2)  Provide a copy of the military equipment use policy to the Governor or the Governor’s designee. 7074. The Legislature finds and declares that ensuring adequate oversight of the acquisition and use of military equipment is a matter of statewide concern rather than a municipal affair as that term is used in Section 5 of Article XI of the California Constitution. Therefore, this chapter applies to all cities, including charter cities and shall supersede any inconsistent provisions in the charter of any city, county, or city and county. 7075. Nothing in this chapter shall preclude a county or local municipality from implementing additional requirements and standards related to the purchase, use, and reporting of military equipment by local law enforcement agencies. SEC. 3. The Legislature finds and declares that Section 1 of this act, which adds Chapter 12.8 (commencing with Section 7070) to Division 7 of Title 1 of the Government Code, furthers, within the meaning of paragraph (7) of subdivision (b) of Section 3 of Article I of the California Constitution, the purposes of that constitutional section as it relates to the right of public access to the meetings of local public bodies or the writings of local public officials and local agencies. Pursuant to paragraph (7) of subdivision (b) of Section 3 of Article I of the California Constitution, the Legislature makes the following findings: Requiring local agencies to hold public meetings prior to the acquisition of military equipment further exposes that activity to public scrutiny and enhances public access to information concerning the conduct of the people’s business. SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district under this act would 92 — 8 — Ch. 406 6.b Packet Pg. 91 result from a legislative mandate that is within the scope of paragraph (7) of subdivision (b) of Section 3 of Article I of the California Constitution. O 92 Ch. 406 — 9 — 6.b Packet Pg. 92 Public Input for Proposed Policy on AB 481 Submission date:6 May 2022, 2:33PM Receipt number:2 Related form version:2 Please share your thoughts with us! I went to the Ciy site titled: New State Law: Draft Military Equipment Use Policy, Next Steps & Ways to Share Input. On it was a "list" of military equipment the PAPD has. This list is useless - it is simply a list of general categories, indeed by use, but this about about law inforcement possessiong military weapons/equipment. Example - less lethal weapons as a category is mentioned, but not what the weapons are. Thus - no transparency, no actual information about the heart of the matter to the public. All hat, no cattle. This is not acceptable. Winter Dellenbach Optional contact information... 1 of 2 6.c Packet Pg. 93 I went to the Ciy site titled: New State Law: Draft Military Equipment Use Policy, Next Steps & Ways to Share Input. On it was a "list" of military equipment the PAPD has. This list is useless - it is simply a list of general categories, indeed by use, but this about about law inforcement possessiong military weapons/equipment. Example - less lethal weapons as a category is mentioned, but not what the weapons are. Thus - no transparency, no actual information about the heart of the matter to the public. All hat, no cattle. This is not acceptable. Winter Dellenbach 2 of 2 6.c Packet Pg. 94 City of Palo Alto (ID # 14601) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Action Items City of Palo Alto Page 1 Title: Discuss and Provide Comments on the City's Draft Comment letter to the California High Speed Rail Authority (CHSRA) and Authorize the Mayor to Send a Comment Letter to the CHSRA on the Final Environmental Impact Report/Environmental Impact Statement (EIR/EIS) for the California High Speed Rail segment between San Francisco and San Jose, Which Traverses Palo Alto. From: City Manager Lead Department: Transportation Department Recommendation Staff recommends that the City Council: 1) Discuss and provide comments on the City’s draft comment letter (Attachment A) to the California High Speed Rail Authority (CHSRA) regarding the Final Environmental Impact Report/Environmental Impact Statement (Final EIR/EIS) for the California High Speed Rail San Jose to San Francisco segment, which traverses the City of Palo Alto. 2) Authorize the Mayor to sign the City’s comment letter, incorporating Council’s requested revisions (if any), and to submit the letter to the CHSRA prior to its consideration for approval of the proposed project and certification of the Final EIR/EIS. 3) Discuss and authorize further actions to advance the City’s interests related to the proposed High Speed Rail project, such as designating representatives to advocate support for the City’s position with state and regional bodies. Executive Summary On June 10, 2022, the California High Speed Rail Authority (CHSRA) released the Final Environmental Report/Environmental Impact in compliance with California Environmental Quality Act (CEQA) and National Environmental Policy Act (NEPA) for the proposed improvements of High-Speed Rail between San Francisco and San Jose. The CHSRA Board of Directors will consider approval of the proposed project and certification of the Final EIR/EIS at a two-day board hearing on August 17 and 18, 2022. If approved, certification of the EIR/EIS for the San Francisco to San Jose segment will complete environmental clearance for the California High Speed Rail in Northern California. As a responsible agency for the proposed project, which would traverse the City along the existing Caltrain tracks, the City of Palo Alto provided comments on the Draft EIR/EIS during the Draft EIR/EIS public comment period. The City’s comments on the Draft/EIS, and the Authority’s responses to those comments are included in Attachment B. City staff reviewed the Final EIR/EIS, including the responses to 7 Packet Pg. 95 City of Palo Alto Page 2 comments. Staff believe that the Authority failed to adequately identify and mitigate the impacts of the proposed project on the City. In particular, the clear and significant impacts related to emergency response, noise, land use, and traffic warrant consideration of grade separation in the EIR/EIS. Staff prepared a draft comment letter in response to the Final EIR/EIS, which is included in Attachment A. Background In 2008, California passed a $9.95 billion bond measure for the High-Speed Rail (Proposition 1A) in order to connect major urban centers from San Francisco to Los Angeles. Since then, the following project milestones have occurred: • On July 18, 2012, Governor Brown signed Senate Bill 1029 authorizing the expenditure of voter- approved Proposition 1A funds and effectively initiating project construction. • On September 19, 2012, the U.S. Federal Railroad Administration (FRA) issued a Record of Decision that approved the alignment from Merced to Fresno. This allowed construction of the Initial Construction Segment (ICS) to begin in 2013. • On March 18, 2013, the CHSRA Board of Directors approved an MOU with the Peninsula Corridor Joint Powers Board (PCJPB) that authorized the Blended System concept for HSR in the San Francisco to San Jose project section. During the same time period California High Speed Rail Authority and Caltrain agreed to electrify the existing Caltrain corridor. The key component of this blended approach is to have the two rail systems share the tracks and maintain the corridor as primarily a two-track railroad. Thus, the High-Speed Rail will primarily utilize the existing Caltrain right-of-way through urban areas. Caltrain is currently in construction for the electrification of this corridor. • In July 2017, Caltrain broke ground to initiate construction for the modernization and electrification of the Caltrain Corridor. These improvements are anticipated to be complete by 2022 when the first electric trains are expected to arrive. In accordance with the 2014 Caltrain EIR, the full fleet of electric trains is anticipated by 2029. • In July 2020, CHSRA released the Draft Environmental Impact Report (EIR)/Environmental Impact Statement (EIS) for the California High Speed Rail San Francisco to San Jose Project section. The City of Palo Alto provided comments on the Draft report during the public comment period (Attachment B). On June 10, 2022, the CHSRA released the Final EIR/EIS for the High-Speed Rail San Francisco and San Jose Section. The CHSRA Board of Directors will consider certifying the Final EIR/EIS and approving the Preferred Alternative in this project section during its two-day board meeting on August 17 and 18, 2022. As this schedule did not allow for staff to analyze the documents and the City Council’s Rail Committee to discuss and develop recommendations on the issues, this item is being advanced for full City Council consideration. The Final EIR report and related documents are available on the CHSRA website.1 The Authority issued a new Notice of Preparation for the proposed San Francisco to San Jose project section in April 2016 based on substantial feedback from stakeholders encouraging a blended Calt rain 1 The Final EIR/EIS for the California High Speed Rail San Francisco to San Jose Section is available online at: https://hsr.ca.gov/programs/environmental-planning/project-section-environmental-documents-tier-2/san- francisco-to-san-jose-project-section-draft-environmental-impact-report-environmental-impact-statement/ 7 Packet Pg. 96 City of Palo Alto Page 3 and High-Speed Rail system. The preferred Alternative A (proposed project) identified in the Draft and Final EIR/EIS proposes a predominantly two-track blended system with no additional passing tracks. The project includes: • Service at one future station (Salesforce Transit Center, which would serve as a HSR station when the Transbay Joint Powers Authority completes its Downtown Extension Project) • Service at three existing Caltrain stations to be shared by HSR and Caltrain (4th and King Street [an interim station only], Millbrae, and San Jose Diridon) • Construction of the East Brisbane light maintenance facility (LMF). Alternative B is similar to Alternative A; however, it includes a 6-mile-long, four-track passing track between San Mateo and Redwood City, the West Brisbane LMF, and an aerial viaduct approaching the San Jose Diridon Station. Both Alternatives have the same alignment and facilities within the jurisdictional boundaries of the City of Palo Alto. The environmental analysis concluded that Alternative A has fewer adverse visual impacts, displacements, road closures, and impacts on wetlands and aquatic habitats as well as a lower capital cost. The project alignment calls for shifts in the railroad alignment to accommodate an increased speed of up to 110 mph of high-speed trains. In addition, there are minor facilities proposed, including communication towers and train control facilities within Palo Alto. Although staff agrees with the conclusion that Alternative A would be the environmentally superior alternative in comparison to Alternative B, City staff have repeatedly expressed concern that the EIR/EIS must include an alternative that evaluates grade separation to address the numerous significant and unavoidable impacts of the High Speed Rail project, as identified in the EIR/EIS. In particular, staff disagrees with the CHSRA’s conclusion that the significant and unavoidable impacts under CEQA or NEPA with respect to traffic circulation and emergency response cannot be mitigated to a less than significant level. For example, for both traffic and circulation either no mitigation has been proposed or mitigation has been proposed that improperly defers responsibility and costs to the City. To the contrary, grade separation would clearly reduce these impacts to a less than significant level and therefore must be analyzed in the Draft EIR/EIS. Although the Authority has stated that it would support and provide cooperation with local jurisdictions, transportation funding agencies, and state and federal agencies, for community-initiated grade- separation efforts over time as funding becomes available, this does not provide any specific commitment for either resources or funding despite the high-speed rail’s direct impacts, which drive the need for grade-separation. Study of grade separation as mitigation or as an alternative in the EIR/EIS is appropriate to address significant impacts. Evaluation would clearly show that this alternative would reduce impacts to a less than significant level and therefore should be constructed and funded as part of the HSR project. Furthermore, the proposed project does not analyze the reasonably foreseeable future scenario of the blended Caltrain system with Caltrain’s anticipated growth scenario, which may include up to twelve (12) Caltrain trains and four (4) HSR trains per hour per direction, as identified in the adopted Caltrain Vision Plan. The draft comment letter identifies this deficiency in the EIR/EIS. By not analyzing this scenario, the CHSRA avoids the need to identify and evaluate the need for passing tracks, which, it is anticipated, could affect Palo Alto to accommodate Caltrain’s adopted vision plan. Failure to identify for 7 Packet Pg. 97 City of Palo Alto Page 4 this reasonably foreseeable future scenario jeopardizes the City’s planning efforts with respect to grade separation projects as well as other land use planning efforts. The draft letter therefore raises the concern that CHSRA must evaluate this scenario in the EIR/EIS so that the location of these tracks would be known and so that the realistic impacts of the proposed project, along with other reasonably foreseeable projects, would be known. The significant cumulative impacts would only reinforce the need for the CHSRA to study and fund grade separation and passing tracks to reduce the impacts of the proposed HSR project. The Authority did, however, address some of the City’s previous concerns regarding safety and noise. As outlined in the Authority’s responses to the City’s comments in Attachment B, the Authority responded with modifications to the Draft EIR/EIS by agreeing to implement four quadrant gates along the corridor, which would improve safety and help to facilitate quiet zones for at-grade crossings. The Authority also modified noise mitigation measures to require that the Authority provide technical support for local jurisdictions filing for permits from the Federal Rail Authority to establish quiet zones. Timeline & Resource Impact With Council’s approval, the Mayor will send a final comment letter on behalf of the City to the CHSRA prior to its two-day public hearing on the proposed project on August 17 and 18, 2022. In the draft letter in Attachment A, the City has expressed concerns regarding the proposed project’s potential impacts on City resources, including reliance on the City to initiate projects of its own (e.g. expansion of roadways, grade separation, quiet zones, etc.) to reduce the significant impacts of the proposed project on the City. Environmental Review Transmittal of the City’s comments on the Final EIR/EIS for the California High Speed Rail San Francisco to San Jose segment does not constitute a project in accordance with Public Resources Code § 21065 and is therefore not subject to environmental review in accordance with the California Environmental Quality Act. Attachments: • Attachment7.a: Attachment A: Comments on the High Speed Rail Final EIR-EIS • Attachment7.b: Attachment B: City of Palo Alto Comments on the Draft EIR and Authority Responses to Comments 7 Packet Pg. 98 [DRAFT – NOT YET APPROVED] August 8, 2022 Northern California Regional Office California High-Speed Rail Authority 100 Paseo De San Antonio, Suite 300 San Jose, CA 95113 Email: san.francisco_san.jose@hsr.ca.gov RE: The San Francisco to San José Project Section Final Environmental Impact Report/Environmental Impact Statement (EIR/EIS) Thank you for the including the City of Palo Alto (City) in the environmental review process for the above- referenced project. The California High Speed Rail (HSR) will have a long-lasting and far-reaching impact on the City of Palo Alto; therefore, we appreciate the opportunity to comment on this Final EIR/EIS as a responsible agency for the Project. Executive Summary The Final EIR/EIS, similar to the Draft EIR, remains seriously flawed in numerous respects, as outlined in this letter. As the City previously commented, the document fails to adequately analyze or to mitigate a variety of clear and significant impacts on the environment. The City disagrees with the Authority’s conclusion that grade separation of at grade crossings does not warrant evaluation, either as mitigation or as an alternative in the EIR, to address the clear and significant impacts on multi-modal transportation, land use, noise, and emergency response. We support the Authority’s addition of four quadrant gates, which improve pedestrian, bicycle, and vehicular safety at these crossings when compared to a project that does not include four quadrant gates. However, the EIR/EIS is flawed in its conclusion that there would be no impacts on safety and, therefore, mitigation to address safety concerns would not be warranted. The City also disagrees with the Authority’s position that the cumulative impacts of this project with the adopted Caltrain Vision Plan do not warrant analysis. By not planning for this reasonably foreseeable future condition, the Authority does not properly disclose impacts in accordance with CEQA and NEPA. For example, underreporting the realistic impacts on delays for emergency responders. In addition, it avoids identification of the need for passing tracks that the City understands would be necessary in Palo Alto, among other jurisdictions, under this cumulative scenario. Avoidance of appropriate planning for this reasonably foreseeable future condition jeopardizes local planning efforts in the design of grade separation projects. Therefore, the Final EIR continues to fall short of reasonable analysis, mitigation, and public disclosure in accordance with state law. Project Understanding The City understands that the San Francisco to San Jose Project Section (project) would provide High Speed Rail (HSR) service from the Salesforce Transit Center in San Francisco to Diridon Station in San Jose along approximately 49 miles of the Caltrain corridor. Within the City of Palo Alto, the project would be located along 3.8 miles of Caltrain right-of-way through the middle of Palo Alto, where the existing Caltrain tracks bifurcate the City from east to west. The current project design proposes a blended infrastructure with Caltrain operations through the City. The current proposed project, as well as both Alternatives carried forward in the environmental analysis, propose two at-grade tracks through the City, mostly within the existing Caltrain right-of-way. The City understands that within Palo Alto, the project would require slight modifications (typically of less than one foot) to the tracks in several areas to straighten curves in order to support higher speeds. The project also requires the installation of two radio towers (one north of 7.a Packet Pg. 99 [DRAFT] San Francisco to San José Final EIR/EIS Comments Page 2 of 5 Embarcadero Road and one north of West Charleston Road), four-quadrant gates at existing at-grade crossings, and either fencing or sound walls along the entire corridor within the City. The Project will provide HSR services at a downtown San Francisco station, a Millbrae station, and the San Jose Diridon Station; no station is proposed within the City of Palo Alto under the current proposed project or either of the two alternatives. The blended system would accommodate operating speeds of up to 110 mph for up to four HSR trains and six Caltrain trains per hour per direction in the peak period. HSR and Caltrain are the only passenger rail services that would operate in the blended system. North of the Santa Clara Caltrain Station, freight would use the same tracks as HSR and Caltrain, but would operate at night with temporal separation to avoid conflicting with HSR and Caltrain operation, similar to existing conditions. Rail Alignment, Profile, and Safety 1. The EIR concludes that there would be a significant impact related to emergency response times within several jurisdictions, including within the City of Palo Alto’s jurisdiction at the Menlo Park/Palo Alto Boundary west of El Camino Real and North of Sand Hill Road. The impacted areas include specific land uses where response times for emergency vehicles would be particularly important, including, but not limited to, assisted living facilities. The EIR/EIS identifies SS-MM #4 which indicates that the City should implement measures to reduce impacts related to the Authority’s HSR project. Suggested measures provided in the EIR/EIS include construction of emergency vehicle and transit queue bypass lanes, modifying roadway capacity and operational improvements to facilities paralleling the rail line to improve access to adjacent grade-separated rail crossings, construction of new fire stations to reduce fire station response times in affected areas, and/or expansion of existing fire stations to reduce fire station response times in affected areas in order to reduce impacts from the Authority’s project. Alternatively, SS-MM #4 indicates that the Authority, with agreement from the local jurisdiction, could make a one-time contribution toward a project that reduce impacts related to emergency response such as those listed above or grade separation. The identified mitigation improperly defers the responsibility of mitigation for the HSR project to the City, both with respect to cost and implementation. It’s unclear whether any of these measures could be feasibly implemented (for example due to lack of right-of-way for expanding roadways, lack of land to build a new or expanded fire station, or with respect to funding or staffing to facilitate any of these future projects). Further, the EIR/EIS fails to analyze the associated environmental impacts of implementing such measures, improperly stating that the responsibility of preparing environmental analysis for that mitigation would fall on the local jurisdiction. The vague alternative mitigation of providing a one-time contribution toward an unspecified project for emergency response times fails to provide any realistic, concrete reduction to the identified impacts and therefore does not provide any meaningful mitigation. Grade separation would reduce this identified significant and unavoidable impact to a less than significant level and therefore must be analyzed. As stated in the City’s previous comments on this project, if the Authority does not pursue at-grade crossings as part of an alternative or as mitigation to restore response times, the Authority must bear the full cost of restoring response times to existing conditions. 2. The EIR/EIS analyzes the effect of HSR train operations on safety for vehicles, bicycles, and pedestrians crossing at at-grade crossings in section 3.11, Safety and Security. The EIR/EIS concludes that, with considerations of planned safety improvements as part of the project, there would be no significant safety impacts associated with the project and that no mitigation is therefore required. While the City concurs that the addition four quadrant gates improves safety at these crossings, particularly for 7.a Packet Pg. 100 [DRAFT] San Francisco to San José Final EIR/EIS Comments Page 3 of 5 vehicles, the City disagrees that this measure reduces the significant safety impacts from the proposed project to a less than significant level. The conclusion fails to consider other safety impacts caused by increased gate down times as well as the foreseeable risk of pedestrian collisions. For example, vehicle delays would result in extensive queueing spilling on to through lanes, which would create safety hazards near at grade crossings. 3. The City recognizes that the Authority’s implementation of four-quadrant gates as part of the proposed project in the Final EIR/EIS would assist the City in establishing a quiet zone for Palo Alto Crossings. The City also appreciates modifications to NV-MM#4 requiring that the Authority assist with the preparation of technical analysis and materials needed for local jurisdictions to file a Quiet Zone application with the Federal Railroad Administration. The City supports this requirement and appreciates the Authority’s response to the City’s comments on this matter to reduce operational noise impacts on surrounding uses. However, because approval of quiet zones is outside of the Authority’s purview and because alternative mitigation that requires construction of sound walls across most of the City’s jurisdiction would result in further impacts to aesthetics and land use, the City continues to assert that grade separation should be evaluated to reduce the identified significant impacts related to operational noise. This mitigation would be within the Authority’s purview and would eliminate the improper need for the City to provide resources and funding to mitigate the impacts of the Authority’s project. Cumulative Impacts 4. The City reiterates the concerns raised in its previous comments that the EIR/EIS does not address the cumulative impacts of CAHSR and Caltrain service vison plans. The EIR assumes 6 trains per direction per peak hour per day, however the Caltrain Vision Plans considers up to 12 trains per direction per peak hour per day. By not analyzing the reasonably foreseeable cumulative impacts of the Caltrain Vision Plan and the proposed project, the EIR/EIS does not properly disclose the realistic delays in response times, among other environmental impacts, including but not limited to, transportation operations and safety, which may result in new or more significant impacts than those identified. The City continues to assert that impacts to all elements combined, including vehicular, bike and pedestrian safety, delays, and emergency response warrants analysis of grade separation as an alternative to the proposed project or as mitigation. Proper analysis of the reasonably foreseeable future condition would only further demonstrate the need for a comprehensive plan to address the identified impacts such as grade separation. Because passing tracks and grade separation are necessitated by the proposed project, the CHSRA must be responsible for implementation and funding of these projects. The High- Speed Rail should not commence service until these infrastructure improvements are complete. Transportation 5. The EIR/EIS contemplates the gate close time of 40-48 seconds for peak hour for 8 trains during any weekday period. Considering the advanced preemption and gate down initiation and opening times, the times assumed in the analysis are not indicative of actual field conditions. Furthermore, there are existing gate closures due to the existing Caltrain running along this corridor. The EIR/EIS must evaluate the cumulative conditions for these gate time closures and based on the realistic delays on traffic. Even when utilizing less conservative assumptions for anticipated gate down times, as noted above, Appendix 3.2A (Page 45, 46, 94, 95) indicates that eight of Palo Alto’s intersections would be significantly impacted. TR-MM#1 in Section 3.2, Transportation, of the Final EIR/EIS discusses site- specific mitigation identified for adverse LOS effects under NEPA. The Authority developed site-specific mitigation for the Final EIR/EIS for certain locations where adverse NEPA traffic effects were identified. However, the Authority concludes that no feasible mitigation was identified that could address the 7.a Packet Pg. 101 [DRAFT] San Francisco to San José Final EIR/EIS Comments Page 4 of 5 effects of any of these intersections, including: El Camino Real/Palo Alto Avenue/Sand Hill Road, Alma Street/Palo Alto Avenue, Alma Street/Churchill Avenue, Mariposa Avenue/Churchill Avenue, Park Boulevard/Meadow Avenue, Park Boulevard/Charleston Road, Castilleja Avenue/Churchill Avenue, and Wilkie Way/West Charleston Road. Therefore, the significant impacts at all of these Palo Alto intersections remain unmitigated. The related impacts on the City with respect to multi-modal transportation and the physical division of the City due to these substantial delays is unacceptable. Grade separation would serve to address these impacts and therefore must be analyzed in the EIR/EIS. 6. Despite significantly higher train speeds, as noted in the Authority’s response to comments 1118-2530, the requirements for warning times and gate down times would not change. As the City previously asserted, this presents safety concerns in that there is reduced reaction time for pedestrians, cyclists and vehicles. The addition of four-quadrant gates does not address this reduction in reaction times, especially for children that may be crossing the tracks to attend one of the many nearby schools. Therefore, the conclusion that the project would have no impact on safety is flawed. The EIR/EIS must conclude that this is a significant impact and accordingly mitigate for the impact. 7. The Authority also notes that “Caltrain is the host railroad and is responsible for compliance with all FRA safety regulations with regard to track and warning systems and would be responsible to make any adjustments in gate activation and any connection to preemption of nearby traffic signal systems.” Again, no clarity on how the Authority may change the nearby traffic signal systems is provided and there is no requirement in the EIR/EIS to coordinate with local agencies to their traffic signal system. The EIR/EIS must be revised to address this. Land Use 8. The City continues to assert that the EIR/EIS fails to properly identify and mitigate land use impacts within the City of Palo Alto. The analysis concludes that because these tracks are existing, the project would not physically divide an established community. However, under current conditions, the gate down times do not discourage transit across the tracks. The significant increase in gate down times and substantial increase in delays at nearby intersections as a result of the proposed project will serve to discourage transit across these tracks, effectively dividing the community in a way that the existing conditions do not. Because these impacts have not been properly identified, appropriate mitigation to reduce impacts, such as grade separation, similarly has not been identified. Noise 9. Impact NV#1 in Section 3.4 of the EIR/EIS identifies temporary exposure of sensitive receptors to construction noise as a significant and unavoidable impact. The proposed mitigation (NV-MM#1) encourages, but does not require, daytime construction. Although the Authority’s response to comments states that some track realignments would require nighttime construction work that could exceed FRA construction noise limits at night, it’s unclear which locations these would occur, how often they may occur, and how many/what types of uses would be affected. The EIR/EIS must disclose this information. The City continues to assert that NV-MM#1 should be revised to require daytime construction given that no other measures can effectively reduce impacts to a less than significant level in accordance with the established thresholds for nighttime noise. Historic 10. The Final EIR/EIS indicates that tree trimming of the historic Palo Alto redwood would be required. The City of Palo Alto’s Urban Forestry Division should be on site to monitor during any tree trimming work for this historic tree. 7.a Packet Pg. 102 [DRAFT] San Francisco to San José Final EIR/EIS Comments Page 5 of 5 We appreciate the opportunity to comment and look forward to responses to the City’s concerns. Should you have any questions regarding this letter, please contact Philip Kamhi, Director of the Office of Transportation at (650) 329-2136 or via e-mail at Philip.Kamhi@CityofPaloalto.org Sincerely, Patrick Burt Mayor, City of Palo Alto 7.a Packet Pg. 103 Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) San Francisco - San Jose - RECORD #1118 DETAIL Status : Unread Record Date : 9/9/2020 Interest As : Local Agency First Name : Ed Last Name : Shikada Attachments : HSR San Francisco to San Jose Project Section EIR Comments_Palo Alto.pdf (1 mb) Stakeholder Comments/Issues : Dear Northern California Regional Office of the California High-Speed Rail Authority, On behalf of City Manager Ed Shikada, please find attached letter regarding the City's comments to the San Francisco to San Jose Project Section Draft Environmental Impact Report/Environmental Impact Statement (EIR/EIS). The California High Speed Rail will have a long-lasting and far-reaching impact on the City of Palo Alto; therefore, we appreciate the opportunity to comment on this Draft EIR/EIS as a responsible agency for the Project. Highest regards, Danille [cid:image003.png@01D685C9.0AD3C620]Danille Rice Executive Assistant to the City Manager (650) 329-2105 | danille.rice@cityofpaloalto.org <mailto:danille.rice@cityofpaloalto.org > www.cityofpaloalto.org<http://www.cityofpaloalto.org/> [cid:image004.png@01D685C8.6BFD8AE0]<https://www.facebook.com/cityofpaloalto/> [cid:image005.png@01D685C8.6BFD8AE0] <https://twitter.com/cityofpaloalto> [cid:image006.jpg@01D685C8.6BFD8AE0] <https://www.instagram.com/cityofpaloalto > [cid:image007.png@01D685C8.6BFD8AE0] <https://medium.com/@PaloAltoConnect > [cid:image008.png@01D685C8.6BFD8AE0] <https://www.linkedin.com/company/cityofpaloalto > C ITY OF PALOALTO OFFICE OF THE CITY MANAGER 250 Hamilton Avenue, 7th Floor Palo Alto, CA 94301 650.329.2392 September 8, 2020 Northern California Regional Office California High-Speed Rail Authority 100 Paseo De San Antonio, Suite 300 San Jose, CA 95113 Email: san.francisco san.jose@hsr.ca.gov RE: The San Francisco to San Jose Project Section Draft Environmental Impact Report/Environmental Impact Statement (EIR/EIS) Thank you for including the City of Palo Alto in the environmental review process for the above-referenced project. The California High Speed Rail (HSR) will have a long-lasting and far-reaching impact on the City of Palo Alto; therefore, we appreciate the opportunity to comment on this Draft EIR/EIS as a responsible agency for the Project. 1118-2511 Executive Summary The Draft EIR/EIS is seriously flawed in numerous respects as outlined in this letter. Fundamentally, the document fails to adequately analyze, much less mitigate, a variety of clear and significant impacts that this project will cause to the Palo Alto community. Failure of the Draft EIR/EIS to consider the cumulative impacts of this project with the Caltrain business plan through the four at-grade crossings would pose an increased safety risk of collisions between trains and people walking, biking, and driving across these crossings. When examining impacts, the Draft EIR/EIS does not analyze the reasonably foreseeable consequences and impacts of the adopted or on-going planning efforts of other users of the corridor that are tied to the HSR project. Such a disconnect ignores the impacts related to the at-grade crossings and the additional four-tracking that may be needed within the corridor. The proposed project alternatives lead to significant impacts to emergency response, noise, and circulation. Grade separation between tracks and crossings at Meadow Drive, Charleston Road, Churchill Avenue, and Palo Alto Avenue would address the impacts related to noise with the elimination of train horns and alleviate the other safety concerns posed at-grade intersection. There is no rationale for excluding grade separations as a feasible mitigation particularly given the Federal Rail Administration's conclusion that the Palo Alto at-grade crossings are amongst the most dangerous in the State. The Draft EIR/EIS falls woefully short of any reasonable standard of environmental analysis. 1118-2512 Project Understanding The City of Palo Alto (City) understands that, Consistent with Tier 1 decisions, the San Francisco to San Jose Project Section (Project Section or project) would provide High Speed Rail (HSR) service from the Salesforce Transit Center (SFTC) in San Francisco to Diridon Station in San Jose along approximately 49 miles of the Caltrain corridor. Within the City of Palo Alto, the project would be located along 3.8 miles of Caltrain right- of-way through the middle of Palo Alto, where the existing Caltrain tracks bifurcate the City from east to West. The current project design proposes a blended infrastructure with Caltrain operations through the City. The current proposed project, as well as both Alternatives carried forward in the environmental analysis, propose two at-grade tracks through the City, mostly within the existing Caltrain right-of-way. CityOfPaloAlto.org Printed with soy-based inks on 100% recycled paper processed without chlorine, 7.b Packet Pg. 104 1118-2512 The City understands that within Palo Alto, the project would require slight modifications (typically of less one than foot) to the tracks in several areas to straighten curves in order to support higher speeds. The project also requires the installation of two radio towers (one north of Embarcadero Road and one north of West Charleston Road), four-quadrant gates at existing at-grade crossings, and either fencing or sounds walls along the entire corridor within the City. The Project will provide HSR services at a downtown San Francisco station, a Millbrae station, and the San Jose Diridon Station; no station is proposed within the City of Palo Alto under the current proposed project or either of the two alternatives. The blended system would accommodate operating speeds of up to 110 mph for up to four HSR trains and six Caltrain trains per hour per direction in the peak period. HSR and Caltrain are the only passenger rail services that would operate in the blended system. North of the Santa Clara Caltrain Station, freight would use the same tracks as HSR and Caltrain but would operate at night with temporal separation to avoid conflicting with HSR and Caltrain operation, similar to existing conditions. 1118-2513 Rail Alignment. Profile, and Right-of-Wav 1 .As discussed further throughout this letter, the EIR/EIS shall consider an alternative or mitigation that includes grade separation of the existing at-grade crossings within the City to reduce impacts related to land use, transportation, and safety that would result from the project. Impacts under these three resources have not been fully identified and mitigated in the Draft EIR/EIS. Additionally, the Authority shall begin inter-agency conversations with the City and other relevant state, regional and local agencies with respect to fair-share funding contributions for grade separations. 1118-2514 2. The City understands that two options are provided for each of the two radio towers required within the City. For each of these two options a site located on private property (4131 Park Blvd and 100 Addison Avenue) and a site located within Caltrain right-of-way is shown. The installation of these towers requires a discretionary permit from the City of Palo Alto and may require easements and/or encroachment permits, depending on which option is selected. The City would not support the location of these towers on private property if an alternate location within Caltrain right-of-way is viable. If construction of either of these radio towers is necessary on private property, the California High Speed Rail Authority (Authority) shall contact and inform these property owners and coordinate for such needs with these property owners prior to filing for any permits from the City. 1118-2515 3. The EIR baseline operational analysis considers only six (6) trains per direction during the peak hours for Caltrain services, which requires the two tracks currently proposed. However, Caltrain's 2040 Vision Plan identifies a moderate growth scenario that calls for eight (8) Caltrain trains per direction during the peak hours and a high growth scenario that calls for twelve (12) Caltrain trains per direction during the peak hours. This conflict in corridor planning needs to be reconciled. The City understands that if eight (8) trains are proposed during the peak hours, additional passing tracks would be necessary. Based on Caltrain's adopted 2040 Vision Plan, this shall be considered a reasonably foreseeable future project and shall be analyzed under the Cumulative scenario. The location of these additional passing tracks shall be disclosed, and the impacts of these tracks must be fully evaluated. 1118-2516 Land Use 4. In the City's scoping comments dated March 31, 2009, the City of Palo Alto requested that the Authority utilize the City's CEQA thresholds in evaluating impacts on components within the City's jurisdiction. However, the EIR/EIS established its own thresholds for land use impacts, which do not reflect the City's thresholds or the State CEQA Guidelines. As a responsible agency, the City of Palo Alto will rely on this EIR in issuing the necessary permits for construction of the project. Therefore, for the purposes of CEQA , the environmental analysis needs to evaluate impacts under land use consistent with the thresholds recommended by the state and adopted by the City of Palo Alto. This includes an analysis of: 1118-2516 whether the project would physically divide and established community; and whether the project would cause a significant environmental impact due to a conflict with any land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect. 1118-2517 5. In accordance with the thresholds identified above, the EIR/EIS must analyze the impacts of HSR preemptions at at-grade crossings and the construction of a noise barrier across the City. With major educational (elementary, middle, high schools, Stanford University), employment centers, and central business districts across the train corridor, the addition of HSR preemptions for at-grade intersections and a 12-14 foot noise barrier across the majority of the tracks will significantly impact connections across the City, visually and physically dividing the community. Because these impacts have not been properly identified, mitigations measures have similarly not been identified to reduce these impacts. 1118-2518 6. In accordance with the thresholds identified above, the EIR/EIS must identify the project's conflicts with the City's Comprehensive Plan policies and Municipal Code Regulations. Land Use Section 3.13 does not identify any inconsistencies with the City of Palo Alto's policies or regulations and concludes that the projects impacts would be less than significant without the need for mitigation. However, Appendix 2-J clearly states that the project is inconsistent with the City of Palo Alto's Comprehensive Plan policies and regulations with respect to noise. Table 1 of Appendix 2-J acknowledges that "Although mitigation measures would be able to reduce project noise levels, they would not reduce all levels to the standards for residential, commercial, and institutional land uses due to the limitations in noise barrier cost effectiveness, implementation (HSR cannot implement quiet zones; only local jurisdictions can), and funding (in regards to grade separations)." Land Use Section 3.13 must be revised to accurately reflect that the project would have a significant impact with respect to inconsistencies with applicable plans and policies within the City of Palo Alto. It must clearly identify the mitigation measures that would reduce that impact to the extent feasible. If mitigation does not reduce this impact to a less than significant level, the EIR/EIS must conclude, for the purposes of CEQA, that impacts would be significant and unavoidable with respect to consistency with local land use policies. 1118-2519 Noise 7. Impact NV#1 in Section 3.4 of the EIR/EIS identifies temporary exposure of sensitive receptors to construction noise as a significant and unavoidable impact. The proposed mitigation (NV-MM#1) encourages, but does not require, daytime construction. It appears to allow the construction contractor to determine the appropriate measures to limit noise but does not set a performance measure that the contactor is required to meet. It only requires reporting after the fact (annually) to the Authority, identifying measures that were implemented. NV-MM#1 should be revised to require daytime construction if other measures cannot effectively reduce impacts to a less than significant level in accordance with the established thresholds for nighttime noise. 1118-2520 8. Table 3.4-25 of the Draft EIR/EIS explains that under Impact NV#8, temporary exposure of sensitive receptors and buildings to construction vibrations, the project "would cause annoyance at nighttime to sensitive receptors within 140 feet for infrequent events and within 300 feet for repetitive equipment such as pile driving, vibratory compaction, and ongoing demolition work with jackhammers or hoe- rams." However, NV-MM#2 only appears to address potential impacts to buildings and does not address impacts to sensitive receptors that may be impacted by vibrations at nighttime. Although NV-IAMF#1 (impact, avoidance and minimization feature) is identified to reduce impacts to sensitive receptors, this measure primarily reduces noise rather than vibration. The measure does not identify performance criteria that must be met to reduce impacts on sensitive receptors to a less than significant level. 7.b Packet Pg. 105 1118-2520 Within the City there are hundreds of sensitive receptors along this corridor, many of which are residences that would be severely impacted due to nighttime vibrations during construction. The Draft EIR/EIS must identify mitigation with clear performance criteria to reduce impacts to these sensitive receptors to a less than significant level. Mitigation shall include prohibition of nighttime construction that causes vibration if other measures cannot effectively reduce impacts to a less than significant level. Pile driving at nighttime shall be prohibited. 1118-2521 9. The analysis of both noise and vibrations needs to clearly quantify the expected level of noise and vibration that sensitive receptors would experience before and after the implementation of mitigation. The analysis currently only provides information on the number of receptors that would be impacted before and after mitigation; not on the level of impact that those receptors would experience. 1118-2522 10. The proposed construction hours for track modifications are outside of the City's allowed construction hours, as established in Chapter 9.10 of the City's Municipal Code. Construction outside of the allowed construction hours requires a permit from the City. The City would not issue this permit for construction activities near residential areas if measures cannot be implemented to reduce impacts on receptors to a less than significant level. 1118-2523 11. Under Impact NV# 2, the Draft EIR/EIS concludes that implementation of the project alternatives would not change current practices regarding the sounding of train horns and crossing bells, but would change the amount of train horns and crossing bells sounding due to the additional trains. Additional trains will cause noise levels above existing ambient levels and in exceedance of FRA criteria, causing severe noise impacts at sensitive receptors. The City understands that the project has analyzed two scenarios with respect to mitigation for noise associated with train horns. The first scenario assumes that quiet zones have not been established within the peninsula and identifies the location where sound walls would therefore be constructed along the corridor to reduce noise levels associated. The City understands that sound walls would be constructed along the majority of the corridor within the City of Palo Alto if quiet zones are not established at the City's existing at-grade crossings. Under the second scenario, if the City were to establish quiet zones for the City of Palo Alto through the requisite process, this would eliminate the requirement for all trains to routinely sound their warning horns when approaching at-grade crossings. Under this scenario, the EIR/EIS shows that sound walls would therefore only be necessary in three locations with the City of Palo Alto. The City recommends that the Authority shall consider grade separation for at-grade crossings due to safety and other reasons stated in this letter, which is feasible mitigation that would also mitigate the need for train horns and therefore construction of noise barriers across the City. However, for the interim measures until grade crossings are built the City of Palo Alto recommends the Authority to establish a Quiet Zone within the City of Palo Alto. In addition, since this process is only necessary to address impacts of the proposed project (as an alternative to noise barriers) the City of Palo Alto shall not bear the financial burden of the process to establish a Quiet Zone. The mitigation measures must require that the Authority bear any costs and to support the process of establishing a Quiet Zone for any jurisdiction that elects to pursue this alternative as well as any liabilities associated with this. 1118-2524 Transportation 12. The City has established a Local transportation Impact Analysis Policy (See Attachment A). The City requests that the Authority comply with this policy, in addition to CEQA and NEPA guidelines, in order to assess the project's local impacts within the City's jurisdiction. The analysis of intersection delays 1118-2524 that was included in the Draft EIR/EIS under Impact TR#5 shall utilize the City's significance criteria when determining whether localized impacts would occur outside of CEQA. 1118-2525 13. Section 3.2 of the Draft EIR/EIS analyzes impacts on bicycle and pedestrian access and Section 3.11 of the Draft EIR/EIS studies hazards associated with the project. However, the Draft EIR/EIS does not adequately analyze the potential hazards associated with the increase in the number of trains and increase in train speeds on school age pedestrians and bicyclists. In Palo Alto, approximately 58 percent of students from elementary school to high school ages walked or hiked to school in 2019. Therefore, a significant number of school age children cross the train tracks at existing at-grade crossings in order to attend nearby K-12 schools (e.g. Hoover Elementary, Palo Alto High, Castilleja, etc.). The proposed four-channel crossing gate mechanism is not adequate to protect these children; this shall be identified as a significant impact with respect to safety and shall be evaluated further. Providing a grade-separated crossing would reduce impacts on pedestrians and bicyclists, including school age children. 1118-2526 14. With the addition of new trains, the proposed gate down time during peak hours will increase by almost 67% (with the addition of 4 HSR). These additional trains throughout the day reduce the time available for pedestrians and bicyclists to cross through the at-grade locations in Palo Alto (Churchill, Meadow, Charleston and Palo Alto) crossings. The impact of the proposed project on these crossing connections for pedestrians and bicyclists must be analyzed and mitigated. 1118-2527 15. Impacts TR # 1 through TR #5 identify impacts and delays on intersection operations. As explained on page 3.2.63, the project results in a 334 second increase in delays at Churchill and 187 second increase in delays at West Meadow Drive. This will severely affect signal operations and controls and thus traffic flow in the area. Although under SB 743 vehicle delays are no longer considered a significant impact under CEQA, the delay at these intersections will impact other modes of transportation such as bicyclists, pedestrians, and bus transit. Such impacts to other modes of transportation still require analysis and appropriate mitigation in accordance with CEQA. These impacts have not been properly identified and TR-MM#1 does not adequately address these impacts. 1118-2528 16. Vehicle delays would also result in extensive queueing spilling on to through lanes and may cause the need for additional storage for turning movements. Extensive queueing will create safety hazards near at grade crossings. The intersection geometry at all four at-grade crossings within the City must be studied in order to properly identify potential hazards and these impacts shall be mitigated. 1118-2529 17. With major educational (elementary, middle, high schools, Stanford University), employment centers, and central business districts across the train corridor, the addition of HSR preemptions for at-grade intersections will significantly impact all modes of transit throughout the day, causing impacts on the transportation system. These impacts have not been properly identified; therefore, mitigations measures have similarly not been identified to reduce these impacts. 1118-2530 1118-2531 18. The project proposes a change in the speed of trains from 79 mph to 110 mph. This change will reduce the reaction time for pedestrian, bicycle, and vehicular activities. In addition, this will impact advanced preemption timings for nearby signals. The existing signals in the vicinity, until grade separated, will need to have advanced preemption to ensure that there is adequate queue clearance, pedestrian times, track clearance and signal operation coordination. These impacts are identified generally but are not quantified and clearly explained to address such impacts. The project shall describe how these improvements will be funded and constructed. The City does not support higher speeds of trains running through urbanized area and therefore requests to use Caltrain planned speed limits or speeds that match existing speed of Caltrain service unless grade separation is proposed at crossings. 7.b Packet Pg. 106 1118-2532 19. The analysis shall evaluate service options that include HSR operating at the same speed as Caltrain from San Jose to San Francisco and must identify the safety benefits that could be derived by running slower speed trains in an urban environment. 1118-2533 20. Due to additional delay at the intersections near the at-grade crossings, the traffic may be diverted to other parallel residential streets, thus impacting the character of neighborhood and livability of Palo Alto residents. These impacts must be identified and mitigated and shall be studied in accordance to City of Palo Alto Traffic impact policy on Traffic Infusion and Residential Environment (TIRE) (Attachment B in Exhibit A). 1118-2534 21. Under Impact TR#7, the analysis identifies that the HSR will increase the parking demand on the other Caltrain stations with increased ridership to connect to get onto HSR at other HSR stations. This increase in ridership to get to HSR transit hubs will necessitate additional parking at other existing Caltrain Stations. This must be identified and mitigated in the EIR/EIS. 1118-2535 22. Impact TR# 9 and TR#11 study permanent and continuous impacts on bus transit. However, the Draft EIR/EIS fails to recognize existing transit routes near the corridor that are impacted by project. Alma Avenue, which parallels the HSR tracks in Palo Alto, is a major road used by express bus transit. The intersections along this corridor will experience significant delays at traffic signals adjacent to at-grade crossings, which in turn, will affect express bus service. TR-MM#2 identifies the transit priority for corridors but fails to identify such impacts on Alma Avenue, and therefore fails to provide any mitigation to address this impact. 1118-2536 Public Services 23. As discussed on Draft EIR/EIS Page 3.11-60, the reduced availability of crossings will impact emergency response times. The project includes mitigation, which includes the Authority's fair share toward reducing the vehicle response time; however, impacts are still identified as significant and unavoidable. Under CEQA, the analysis must analyze any feasible mitigation or alternatives to address impacts before identifying an impact as significant and unavoidable. An alternative or mitigation that includes grade separation for at-grade crossings must be evaluated to ensure adequate response times. If the Authority does not pursue at-grade crossings as part of an alternative or as mitigation to restore response times, the Authority shall bear the full cost of restoring response times to existing conditions. 1118-2537 Historic 24. The proposed project identifies track modifications, including horizontal alignment changes of more than 1 foot and less than 3 feet on the SPRR San Francisquito Creek Bridge, which is located approximately 10 feet west of the Historic El Palo Alto redwood tree. Track work in this location may also require relocation of OCS poles and OCS pole electrical safety zones. The EIR/EIS concludes that the project would not result in modifications to the El Palo Alto redwood, and that impacts would therefore be less than significant without mitigation. However, although the project does not propose direct removal or modifications to the tree, grading or the use of vibratory equipment for track work within 10 feet of the historic tree could result in direct or indirect impacts to the root structure. These impacts must be evaluated and mitigated to ensure that impacts to this historic landmark would remain less than significant. 1118-2538 Utilities 25. Impact PUE#2 identifies impacts associated with the relocation or removal of existing major utilities as less than significant without mitigation. However, construction activities that result in vibrations above or immediately adjacent to existing infrastructure could indirectly impact infrastructure. The City of 1118-2538 Palo Alto owns and maintains a wide variety of infrastructure that cross these tracks. The potential for indirect impacts must be identified and mitigation shall be included to require advanced coordination with the City when working in close proximity to its infrastructure as well as to verify, post- construction, that the City's infrastructure has not been damaged. 1118-2539 26. Although the analysis concludes that the Authority and service providers would work to relocate utilities on a long-term basis, the discussion identifies that temporary utility disruptions may occur. Although applicant proposed measures are identified to reduce these impacts and provide notifications to customers, the duration of these outages is unclear. The document needs to more clearly identify the anticipated temporary impacts on utilities, including the likely duration of outages that may be necessary. 1118-2540 Trees and Vegetation 27. The proposed project plans appear to show that new wails or fence would be installed up to the edge of the existing right-of-way, with no space planned for planting vegetation screening. It is unclear to what extent existing vegetation along the right-of-way, which currently provides effective screening in some locations, would be retained or replanted. Space needs to be provided for vegetation screening, especially where the rail is within close proximity to sensitive receptors. 1118-2541 28. MM-39 states that mitigation would be provided at no more than a 1:1 ratio unless the City's ordinance provides for stricter ratios. For mitigation within the City, the project would be required to replace trees in accordance with the City's Tree Tech Manual tree value replacement standard, as outlined in the City's Tree Technical Manual, which is codified in Chapter 8 of the City's Municipal Code. The Tree Technical Manual can be found at: https://tinvurl.com/PA-Tree-Technical-Manual We appreciate the opportunity to comment and look forward to reviewing the Final EIR/EIS, including responses to the City's comments. Should you have any questions regarding this letter, please contact Philip Kamhi at (650) 329-2500 or via e-mail at Philip.Kamhi@citvofpaloalto.org Sincerely, Ed Shikada City Manager Attachments: Exhibit A: Local transportation Impact Analysis Policy CC: Palo Alto City Council Members Expanded Community Advisory Panel Palo Alto Planning and Transportation Commission Palo Alto Pedestrian and Bicycle Advisory Committee Palo Alto Safe Routes to School Committee 7.b Packet Pg. 107 V CITY OFPALO ALTO CITY OF PALO ALTO LOCAL TRANSPORTATION IMPACT ANALYSIS POLICY Senate Bill (SB) 743, adopted in 2013, required the Governor's Office of Planning and Research (OPR) to prepare amendments to the CEQA Guidelines with respect to the analysis of potential transportation effects to provide an alternative metric to traffic congestion and delay at intersections (often referred to as Level of Service (LOS)). After five years of analysis and outreach, in December 2018, the California Natural Resources Agency approved OPR's proposed amendments to the CEQA Guidelines requiring agencies to use vehicle miles traveled (VMT) generated by a project as the metric for transportation impact analyses under CEQA effective July 1, 2020. Under SB 743 and the revised CEQA Guidelines, LOS may no longer be used to determine whether a project may have a significant environmental impact to transportation and traffic under CEQA. While statewide implementation of VMT analysis to replace LOS analysis is required under CEQA, SB 743 did not require changes to transportation analyses outside of CEQA, including the evaluation of regionally significant intersections under the Congestion Management Program (CMP) under a separate state law. Nor did SB 743 affect the discretion of public agencies to assess impacts on local streets and intersections for compliance with adopted plans and policies. As such, in conformance with Policy T-2.3 and Program T-2.3.1 of the City's Comprehensive Plan 2030,1 LOS standards are adopted through this policy to analyze potential local transportation impacts of projects in Palo Alto. I. Purpose The purpose of this Policy is to ensure consistency in reviewing and identifying transportation effects of proposed development projects for local intersections and facilities and to determine standards for necessary remediation measures. 1 Comprehensive Plan Policy T-2.3: Use motor vehicle LOS at signalized intersections to evaluate the potential impact of proposed projects, including contributions to cumulative congestion. Use signal warrants and other metrics to evaluate impacts at unsignalized intersections. Program T-2.3.1: When adopting new CEQA significance thresholds for VMT for compliance with SB 743 (2013), adopt standards for vehicular LOS analysis for use in evaluating the consistency of a proposed project with the Comprehensive Plan, and also explore desired standards for MM LOS, which includes motor vehicle LOS, at signalized intersections. Policy T-2.4: Consistent with the principles of Complete Streets adopted by the City, work to achieve and maintain acceptable levels of service for transit vehicles, bicyclists, pedestrians and automobiles on roads in Palo Alto, while maintaining the ability to customize to the Palo Alto context. Policy T-3.3: Avoid major increases in single-occupant vehicle capacity when constructing or modifying roadways unless needed to remedy severe congestion or critical neighborhood traffic problems. Where capacity is increased, balance the needs of motor vehicles with those of pedestrians and bicyclists II. Level of Service (LOS) Analysis LOS is the measurement of delay at intersections used to determine whether a project is consistent with the City's Comprehensive Plan and this Policy LOS is based on the Highway Capacity Manual (HCM) methodology where a letter grade is assigned to an intersection operation based on the amount of delay motorists experience in traveling through the intersection. Table 1 below shows the comparison in LOS depending on whether the intersection is signalized or not. Table 1: Level of Service Delay - Signalized vs. Non-Signalized Intersections Level of Service Grade Description Signalized Average Delay (Sec) Unsignalized Average Delay (Sec) A Signal Progression is extremely favorable. Little or no traffic delay. 10.0 or less 10.0 or less B Operations characterized by good signal progression and/or short cycle lengths. Short traffic delays. 10.1 to 20.0 10.1 to 15.0 C Higher delays may result from fair signal progression. Average traffic delays. 20.1 to 35.0 15.1 to 25.0 D Congestion becomes noticeable. Long traffic delays. 35.1 to 55.0 25.1 to 35.0 E Considered the limit of acceptable delay. 55.1 to 80.0 35.1 to 50.0 F Level of delay is considered unacceptable by most drivers. Extreme traffic delays. Greater than 80.0 Greater than 50.0 Source: Transportation Research Board, Highway Capacity Manual 2010 III. Standards for Determining Transportation Analysis 1. Within the CMP Svstem Regional CMP Analysis Traffic Impact Analysis (TIA) reports vary in scope depending on the use of the report and size of the project. Under the purview of the California Congestion Management Program (CMP) Statute, Palo Alto must follow the methodologies presented in the VTA Transportation Impact Analysis Guidelines for intersections within the CMP system, to evaluate transportation effects and submit a full TIA report of all development projects that are expected to generate 100 or more net new weekday (AM or PM peak hour) or weekend peak hour trips, including both inbound and outbound trips. 7.b Packet Pg. 108 CMP intersections within Palo Alto are listed below. A map of all CMP intersections can be found in Attachment A. i. Middlefield Rd./Oregon Exp. ii. Middlefield Rd./San Antonio Rd. iii. El Camino Real/University Ave./Palm Dr. iv. El Camino Real/ Sand Hill Rd./Palo Alto Ave. v. El Camino Real/Embarcadero Rd. vi. El Camino Real/Page Mill Rd. vii. El Camino Real/Arastradero Rd./Charleston Rd. viii. Foothill Exp./Junipero Serra Blvd./Page Mill Rd. ix. Foothill Exp./Arastradero Rd. x. San Antonio Rd./Charleston Rd. 2. Outside the CMP System Local Analysis The City requires a Local Transportation Analysis (LTA) report for any project that is expected to generate 50 or more net new weekday (AM or PM peak hour) trips, including both inbound and outbound trips, prior to any reductions assumed for Transportation Demand Management (TDM) measures. The City may also require a LTA if in its reasonable judgement a project will potentially cause a deficiency in the operation of local intersections. A LTA report must include the following: i. Project description; ii. Existing conditions; iii. Site access and circulation; iv. Vehicle trip generation (weekday AM and PM peak); v.__Vehicle trip distribution; V. Vi. LOS analysis for selected study intersections: and vi. vii. Remediation measures (if proposed) Depending on the size and layout of the project, additional elements listed below may be required by the City to include in the LTA report. i. Traffic Infusion on Residential Environments (TIRE) Analysis is an analysis of new potential traffic disturbances along a local residential streets created by a project as described in the Attachment B. When a proposed development project is expected to add 10 or more peak hour vehicles per any direction to a local residential street that is not on a project's direct route to collector or arterial streets, the project is required to submit a TIRE analysis. ii. Queuing Analysis that identifies queues spilling beyond their current storage bays. Improvements may include lengthening storage bays to meet projected demand or roadway capacity improvements to add additional turn pockets at an intersection. The City typically takes the lead in identifying potential capacity improvements to help facilities site design. iii. Transit Analysis for projects located along a key transit route, such as El Camino Real, a focused analysis in partnership with the VTA or other transit operators is provided to determine if off-site improvement of a project should consider additional parking stop improvements such as shelters or bus duck- outs. iv. Bicycle and Pedestrian Circulation Study is an analysis of how the site operations may affect bicycle and pedestrian operations. Where appropriate, if a project is located along a major bicycle route in the City's Bicycle & Pedestrian Transportation Plan, the project may be required to help implement a portion of the recommended facility. Additional improvements may include limiting driveway curb-cuts to minimize conflicts with pedestrians or provision of enhanced crosswalk facilities. v. Parking Analysis is a study to determine location, use, and adequacy of the proposed parking facility. Projects should include a parking analysis under the following conditions: a. Change in the facilities' existing design or supply; or b. Change in the existing parking management; or c. Propose parking less than that required by the Palo Alto Municipal Code 18.52 (https://tinvurl.com/PA-Municipal-Code): or d. Use of parking adjustments by the Director as defined in the Palo Alto Municipal Code 18.52 (https://tinvurl.com/PA-Municipal-Code). When a proposed project requests a parking reduction or exception as allowed under the Municipal Code, a robust Transportation Demand Management (TDM) Plan is typically required independent of the LTA. For projects in a Parking Assessment District, required payment of assessments to the District will be noted in the LTA report and included in the project's conditions of approval. A project will provide an analysis of one or more of the above elements if the project is expected to substantially affect the identified local facilities, even if the anticipated number of new vehicle trips would not require a LOS analysis. _ 7.b Packet Pg. 109 IV. Local Transportation Impacts - Standards for Determining Transportation Consistency 1. Level of Service Standard The City of Palo Alto's Level of Service (LOS) standard is D, which is more conservative than the CMP LOS standard of E. If the LTA shows that a development project is anticipated to cause a transportation facility (intersection or roadway) to degrade below LOS D to LOS E or F, then the project will be deemed inconsistent with this Policy. For a transportation facility determined to have been at LOS E or F under existing and background conditions without the project, a project is said to have significant local impact if the LTA shows that the project will cause LOS to deteriorate by the following amounts: i. Addition of project traffic increases the average delay for critical movements by four or more seconds; or ii. Addition of project traffic increases the critical Volume/Capacity (V/C) value by 0.01 or more; or iii. Affects a freeway segment or ramp to operate at LOS F or project traffic increases freeway capacity by one or more percent. 2. Selection of Study Intersections or Roadways An intersection should be included in the LTA if it meets any one of the following conditions: i. Proposed development project is expected to add 10 or more peak hour vehicles per any lane to any intersection movement; or ii. The intersection is adjacent to the project; or iii. Based on engineering judgement, City staff determines that the intersection should be included in the analysis. Additionally, a roadway segment should be included in the LTA with a TIRE analysis if a proposed development project is expected to add 10 or more peak hour vehicles per any direction to a local residential street. More details on the TIRE analysis are available in Attachment B. 3. CMP Intersection Standard A CMP intersection must adhere to the standards set by the Congestion Management Agency2 (currently LOS E), as set forth in the VTA Transportation Impact Analysis Guidelines. The City's standard of LOS D would apply for determining local level impacts.. Any transportation impact triggered by VTA's standard for CMP intersections would need to be addressed following guidelines established by VTA. More information regarding mitigation measures and Multimodal Improvement Plans (MIP) are available in the VTA Guidelines for TIAs and Deficiency Plans. 4. Auto Level of Service Analysis at Unsignalized Intersections For all-way stop control, the LOS is based on the average delay. For 1- or 2-way stop control, the LOS should be based on the critical approach movement. The above standards for determining transportation consistency remain appropriate only if traffic volumes satisfy the peak hour traffic signal warrant. Meeting a peak hour traffic signal warrant does not automatically make a traffic signal an appropriate remediation measure. 5. Other Transportation Impacts Depending on the size and layout of the project, a LTA may require analysis to evaluate other project-related effects on the transportation system. The following is a list of elements that are considered to have project-related local impacts: i. Result in noticeable traffic effects on local residential streets defined as an increase of 0.1 or more using the TIRE methodology. ii. Impede the development or function of existing or planned pedestrian or bicycle facilities. iii. Increase demand for pedestrian or bicycle facilities that cannot be met by existing or planned facilities. iv. Impede the operation of a transit system as a result of increased traffic congestion. v. Create demand for transit services that cannot be met by current or planned services. vi. Create the potential demand for cut-through traffic or redistribution of traffic to use local residential streets, based on the TIRE methodology described above. vii. Create an operational safety hazard. viii. Result in inadequate emergency access. 2The Santa Clara Valley Transportation Authority (VTA) is the Congestion Management Agency (CMA) for Santa Clara County. 7.b Packet Pg. 110 V. Remediation Measures All Local Transportation Impacts under Section VI of this Policy must be addressed through the project's adoption or use of appropriate local remediation measures, including funding their associated costs. The LTA must include proposed remediation measures and identify any potential impacts of such measures. Remediation measures shall reduce the project-related local impacts to a level without the proposed project, and should not themselves create potentially significant CEQA impacts. These remediation measures will be incorporated in the project conditions of approval and not as part of the CEQA analysis. The following is a list of potential remediation methods in priority order: 1. Projects and programs that reduce a project's vehicle trip generation, including, but not limited to Transportation Demand Management (TDM) programs, capital improvements to transit, bicycle, and pedestrian facility enhancements within an influential project area.3 The following is a non-exhaustive list of potential remediation methods: i. Provide new or upgrade existing access to, from, and through the project for pedestrians and bicyclists. ii. Provide improvements to transit facilities or services. iii. Implement TDM programs such as flexible at-place working hours, telecommuting, carpools, shuttles, transit passes, parking cash-out, among others. 2. Multimodal operational or facility improvements including intersection operational efficiency treatments. Proposed improvements or treatments with geometric changes to an intersection are limited to features that would not likely lead to substantial or measurable increase in vehicle travel. 3. If project impacts cannot be remediated through methods 1 and 2 above, a fair share of the cost for multimodal network remediation shall be contributed to the City's transportation improvement funds. While the remediation measures in method 1, above, should be proposed within an influential project area, methods 2 and 3 may apply outside the area. However, these proposed improvements should substantially contribute to the City's Comprehensive Plan goals in expanding the City's multimodal transportation system. By implementing or funding these types of improvements, the project would therefore be consistent with the Comprehensive Plan and this Policy. 3 Area of influence of a project is defined as up to half-mile for pedestrian facilities and up to three miles for bicycle facilities, or bicycle facilities that provide a connection to the local or regional bicycle network. Unacceptable Measures In addition, remediation measures that will result in a physical reduction in the capacity and/or deterioration in the quality of any existing or planned transportation facilities are unacceptable. The following is a list of remediation methods that would be considered generally unacceptable without special justification, but are not limited to: 1. Roadway widening not directly related to site access and circulation, or specific conditions that reduce local impacts as a result of the project. 2. Negatively affecting a sidewalk or reducing the width of a sidewalk without substantial improvement to the overall pedestrian circulation. 3. Maintaining an existing sidewalk in the immediate vicinity that is below the current city standard. 4. Negatively affecting existing bicycle infrastructure or reducing the length of a bicycle infrastructure. 5. Maintaining existing bicycle infrastructure that is below the current city standard. 6. Eliminating a bus stop without adequate replacement or improvement to the system. 7. Encouraging neighborhood cut-through traffic (intrusion effects along local residential streets). VI. Authority to Adopt Guidelines The Chief Transportation Official is authorized to adopt guidelines to implement this Policy. 7.b Packet Pg. 111 ATTACHMENT A CONGESTION MANAGEMENT PROGRAM INTERSECTIONS O «**'***' --------------------------- ol 4 @ m ° CMPWe"*c“"W0 0 / ' 1 ° 0<5» b i o - r z . ** 4> ° 0 ° o „ , I, O ° ^ O O l<gyt OO --------------------=E P Jg a -„ J° 8 O sfvcP oI ft- Q 0 ^ . 0 0* «b °o o ° ft O <P b O’ ° >°© S o o V0® ° /o ^ l ° o »«—l s off1 ® / ° V q, o° s r° . ft \ O o 30 0-0 OCCP8 Q o ^ O% * t ‘■''0«C 0° / 8 \0 8 * .,*.*,0 % k a" “ " 1 ) 0 0 O 0 0 ^0 0 — <b f' o ° O ----------------------- 0 | o o 9 oO o South County 0 # « 13 (fc Q ° 8 0 —^ \ > • % 0 0^ ° “ CO ° \ 8 V Q O Braoh»ti O& o o 000 -a o® a 8 § 8 «o ® ° 6 0 * £ " “ ° 6 ‘ 3~...-■ - & 0\ Source: Santa Clara Valley Transportation Authority Congestion Management Program Document 2017 ATTACHMENT B CITY OF PALO ALTO - TRAFFIC INFUSION ON RESIDENTIAL ENVIRONMENTS (TIRE) ANALYSIS Excessive vehicular speed and traffic volume on residential streets pose a major threat to quality of life. Most Palo Alto streets are bordered by residential uses, and it is the City's priority to preserve local neighborhood characteristics. Additionally, the City has designated some streets as residential arterials to recognize that they carry large traffic volumes of through-traffic but also have residential uses on both sides of the streets. The objective of this analysis is to address the desires of residents of these streets who prefer slower vehicular speeds and to determine if implementation of a project would cause a substantial change in the character of these streets. The City of Palo Alto uses the Traffic Infusion on Residential Environments (TIRE) methodology to estimate residential perception of traffic effects based on anticipated average daily traffic growth. Although not required under the California Environmental Quality Act (CEQA) or pursuant to the Santa Clara Valley Transportation Authority (VTA) guidelines, this methodology intends to determine new potential traffic disturbances - cut-through traffic (intrusion effects) and direct traffic (infusion effects) - along local residential streets due to a proposed development project. For projects on a local residential street, new traffic disturbances along that specific street will likely be unavoidable. Thus, the potential infusion effects generated along a specific local residential street of which a project is proposed will be used only for informational purposes. A map of Palo Alto's local residential streets can be found in Map 1 in this attachment. The City aims to reduce potential adverse intrusion effects along local residential streets. Significant amount of vehicle intrusion on these streets may need to be addressed through traffic management strategies. Traffic Infusion on Residential Environments (TIRE) Index The TIRE methodology assigns a numerical value to "residents' perception of traffic effects on activities such as walking, bicycling, and maneuvering out of a driveway on local residential streets." The TIRE index scale ranges from 0 to 5 depending on daily traffic volume. An index of 0 represents the least traffic disturbances and 5 the greatest, and thereby, the poorest residential environment. Streets with a TIRE index of 3 and above are considered to function primarily as a traffic street and exhibit an impaired residential environment. Therefore, streets with a TIRE index below 3 are better suited for residential activities. Any projected change in the TIRE index of 0.1 or less is considered to have no noticeable effects. A change of 0.1 would be barely noticeable, and a change of 0.2 or greater would be noticeable. The TIRE Index can be found in Table 1 in this attachment. 2020052801 2020052801 CITY OF PALO ALTO i CITY OFPALO ALTO 7.b Packet Pg. 112 v CITY OFPALO ALTO I. Standards for Determining Analysis A proposed development project expecting to add 10 or more peak hour vehicles per any direction to a local residential street. II. Selection and Data Collection of Roadway Segments Roadway segments should be included in the LTA if a proposed development project is expected to add 10 or more peak hour vehicles per any direction to a local residential street. Data collected under the TIRE methodology must be supported by 24-hour weekday traffic counts. For projects on a local residential street including both single- or multi-family, as defined in the City's Comprehensive Plan 2030, the TIRE analysis must include the following: 1. Direct routes to the project; 2. Immediate connections to a project's direct collector or arterial streets; and 3. Based on engineering judgement, City staff determines what roadway segments should be included in the analysis. A Palo Alto land use map can be found in Map 2 in this attachment. III. Standards for Determining Noticeable Effect Projected change in the TIRE index of 0.1 or more under existing and background conditions, is considered to cause noticeable effects on the character of local residential streets. These traffic effects may need to be addressed through traffic management strategies. v CITY OFPALO ALTO Table 1: Traffic Infusion on Residential Environments (TIRE) Index TIRE Index Existing Daily Traffic Volume Volume to Cause +0.1 Change in TIRE Index Volume to Cause +0.2 Change in TIRE Index Volume Description 1.5 29-35 6 15 Low 1.6 36-44 8 20 1.7 45-56 10 25 1.8 57-70 13 32 1.9 71-89 17 41 2.0 90-110 22 52 Moderate 2.1 111-140 29 65 2.2 141-180 40 80 2.3 181-220 52 100 2.4 221-280 65 125 2.5 281-350 79 160 2.6 351-450 94 205 2.7 451-560 114 260 2.8 561-710 140 330 2.9 711-890 170 415 3.0 891-1,100 220 520 High 3.1 1,101-1,400 290 650 3.2 1,401-1,800 380 800 3.3 1,801-2,200 500 1,000 3.4 2,201-2,800 650 1,300 3.5 2,801-3,500 825 1,700 3.6 3,501-4,500 1,025 2,200 3.7 4,501-5,600 1,250 2,800 3.8 5,601-7,100 1,500 3,500 3.9 7,101-8,900 1,800 4,300 4.0 8,901-11,000 2,300 5,300 Very High 4.1 11,001-14,000 3,000 6,500 4.2 14,001-18,000 4,000 8,000 4.3 18,001-22,000 5,200 10,000 4.4 22,001-28,000 6,600 13,000 4.5 28,001-35,000 8,200 17,000 4.6 35,001-45,000 10,000 22,000 4.7 45,001-56,000 12,200 28,000 4.8 56,001-71,000 14,800 35,000 4.9 71,001-89,000 18,000 43,000 Source: Goodrich Traffic Group 2020052801 2020052801 7.b Packet Pg. 113 CITY OF PALO ALTO Mnn 1 Citv nf Pnln Altn I nrnl Rpsicipntinl Strppts CITY OFI f PALO ALTO 2020052801 2020052801 Source: City of Palo Alto Comprehensive Plan 2030 Map 2: City of Palo Alto Comprehensive Plan 2030 Land Use Designations Source: City of Palo Alto Comprehensive Plan 2030 7.b Packet Pg. 114 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) 1118-2511 Refer to Standard Response FJ-Response-GEN-4: Consideration of 2040 Caltrain Service Vision and Caltrain Business Plan, FJ-Response-GS-1: Requests for Grade Separations. The comment asserts that the Draft EIR/EIS is inadequate as it fails to analyze and mitigate significant impacts in the City of Palo Alto. The Authority disagrees with this assertion. The Draft EIR/EIS provides sufficient information to inform the public and decisionmakers of the significant environmental effects of the project within the City of Palo Alto, and identifies mitigation measures to avoid, reduce, or minimize impacts, when feasible. In subsequent individual comments, the commenter raised specific concerns about the impact analysis or mitigation related to land use, socioeconomics and communities, noise and vibration, transportation, safety and security, cultural resources, public utilities and energy, and biological resources. Each of these specific comments has been addressed. Please refer to the responses to submission FJ-1118 as follows: comments 2516 through 2518 related to land use and communities; comments 2519 through 2523 related to noise; comments 2524 through 2535 related to transportation and safety; comments 2536, 2538, and 2539 related to public services and utilities; comment 2537 related to cultural resources; and comments 2540 and 2541 related to biological resources. The comment also asserts that the Draft EIR/EIS fails to consider cumulative impacts of the Caltrain Business Plan. Please refer to Standard Response FJ-Response-GEN-4: Consideration of 2040 Caltrain Service Vision and Caltrain Business Plan, which addresses this topic. The comment requests that the Authority consider grade separations as mitigation for project impacts. Please refer to Standard Response FJ- Response-GS-1: Requests for Grade Separations, which addresses this topic. 1118-2512 The comment summarizes information presented in the Draft EIR/EIS. The comment is noted but does not raise any specific concern regarding the conclusions or adequacy of the Draft EIR/EIS, nor did it result in any revisions to the Draft EIR/EIS. 1118-2513 Refer to Standard Response FJ-Response-GS-1: Requests for Grade Separations, FJ- Response-SS-1: At-Grade Crossing Safety. The comment asserts that land use, transportation, and safety impacts resulting from the project have not been fully analyzed and mitigated. The Authority disagrees with this assertion. Refer to Draft EIR/EIS Section 3.2, Transportation; Section 3.11, Safety and Security; and Section 3.13, Station Planning, Land Use, and Development which provide analysis of the environmental impacts of the project and identify mitigation measures to avoid, reduce, or minimize impacts, when feasible. In subsequent individual comments, the commenter raised specific concerns about the impact analysis or mitigation related to land use, transportation, safety and security. Please also refer to the response to submission FJ-1118, comments 2516 through 2518 related to land use and communities and comments 2524 through 2535 related to transportation and safety, which address the city’s concerns in more detail. The comment did not result in any revisions to the Draft EIR/EIS. California High-Speed Rail Authority June 2022 San Francisco to San Jose Project Section Final EIR/EIS Page | 20-711 7.b Packet Pg. 115 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2514 Please refer to Table 8-3 in Section 8.4.4, Preferred Alternative Identification, of the Final EIR/EIS, which identifies the Authority’s preferred radio communication tower sites. In Palo Alto, the preferred radio communication tower sites are standalone radio tower 8 alternate site 2 (located southwest of the Embarcadero Road underpass of the Caltrain corridor immediately adjacent to the Caltrain right-of-way) and standalone radio tower 8A alternate site 1 (located within the Caltrain right-of-way). These locations are preferred because they would minimize additional right-of-way acquisition, which is consistent with the City’s preferences. With respect to the process for coordinating with property owners should the acquisition of private property be required, the Authority would begin the outreach process for acquisition during the final design phase. The Authority would hold community meetings to explain the acquisition process and answer questions. Individual affected property owners would receive an official communication from the Authority and be assigned a real property agent to work with. All acquisition would be conducted in accordance with the Uniform Relocation Act (42 U.S.C. Chapter 61), as described in SOCIO-IAMF#2. The Uniform Relocation Act establishes minimum standards for the treatment of and compensation to individuals whose real property is acquired for a federally funded project. Information about acquisition, compensation, and relocation assistance is also available on the Authority's website: hsr.ca.gov/programs/private-property/. 1118-2515 Refer to Standard Response FJ-Response-GEN-4: Consideration of 2040 Caltrain Service Vision and Caltrain Business Plan. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2516 Refer to Standard Response FJ-Response-OUT-3: Local Government Permits. The comment states that the Draft EIR/EIS needs to evaluate impacts on land use consistent with CEQA significance thresholds adopted by the state and the City of Palo Alto. This includes (1) whether the project would physically divide an established community and (2) whether the project would cause a significant environmental impact due to a conflict with any land use plan, policy, or regulation adopted for the purpose of avoiding or mitigating an environmental effect. Please refer to Section 3.12.4.5, Method for Determining Significance under CEQA, which identifies the first CEQA threshold mentioned by the commenter (whether the project would physically divide an established community). Please refer to Section 3.13.4.5, Method for Determining Significance under CEQA, which identifies the second CEQA threshold mentioned by the commenter (if the project would cause a significant environmental impact due to a conflict with any land use plan, policy, or regulations adopted for the purpose of avoiding or mitigating an environmental impact). Please also refer to Appendix 2-J, Policy Consistency Analysis, which provides a policy consistency analysis for the project alternatives. The EIR/EIS includes the thresholds identified in the comment and no revisions are required. June 2022 California High-Speed Rail Authority Page | 20-712 San Francisco to San Jose Project Section Final EIR/EIS 7.b Packet Pg. 116 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2517 The comment from the City of Palo Alto asserts that community division impacts associated with HSR preemptions at at-grade crossings and the inclusion of a noise barrier have not been adequately identified in the Draft EIR/EIS. The Authority respectfully disagrees with the assertion that the Draft EIR/EIS has not fully described these impacts. In both Alternative A and B, HSR trains would use the existing Caltrain tracks. To some extent, these existing tracks already visually and physically divide the community. Regarding the effects of HSR preemptions (gate closures) at at-grade crossings, refer to Draft EIR/EIS Section 3.12, Socioeconomics and Communities. In that section, refer to Impact SOCIO#3, which acknowledges that gate closures at the at-grade crossings could lead to greater delays to pass across such areas. Access would still be maintained and such temporary delays would not represent a physical division of the existing community. While the project would include bicycle and pedestrian facilities to maintain all forms of transportation across and along the rail corridor, such aspects of the project are noted for the record; the CEQA conclusion does not hinge on this point. Regarding noise barriers, refer to Draft EIR/EIS Section 3.4, Noise and Vibration. In that section, Table 3.4-21 identifies 13 locations in Palo Alto where noise barriers would be effective in reducing noise impacts. No noise barriers are proposed to be constructed across any at-grade crossings and thus would not cause or contribute to any road closures or decreased vehicle connectivity. Moreover, the Authority would not construct any noise barriers without the consent of 75 percent of all affected parties. Several sections of the Draft EIR/EIS consider the impacts of noise barriers. Refer to Section 3.4.7, Mitigation Measures, and Section 3.15.7, Mitigation Measures, particularly AVQ-MM#4, AVQ-MM#5, and AVQ-MM#6. Please also refer to the response to submission FJ-1118, comment 2540, which addresses the visual impacts of noise barriers. The analysis in these sections support the conclusion for Impact SOCIO#3 that there would be no secondary impacts on community cohesion associated with project operations, because the recommended noise barriers would be constructed within an existing transportation corridor and would not physically divide established communities 1118-2517 or disrupt community circulation to the extent that community character or cohesion would be affected. Accordingly, impacts on communities associated with transportation, noise and vibration, or visual quality would not physically divide established communities, and therefore no mitigation associated with Impact SOCIO#3 is required. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2518 The comment states that the EIR/EIS must identify any inconsistencies with the City of Palo Alto’s Comprehensive Plan and determine impacts based on this analysis. As the commenter notes, Draft EIR/EIS Section 3.4.3, Consistency with Plans and Laws, and Volume 2, Appendix 2-J, Policy Consistency Analysis, provide a policy consistency analysis for the project alternatives and identify that the project alternatives would be inconsistent with the City of Palo Alto’s Comprehensive Plan policies and regulations with respect to noise. However, as stated in Section 3.4.2.3, Regional and Local, of the Draft EIR/EIS, the HSR system is not subject to local general plan policies and ordinances related to noise limits or to locally based criteria concerning noise and vibration for the project alternatives. Instead, the project is subject to federal noise and vibration impact criteria (as set forth by the FRA). The noise and vibration impact assessments were conducted following FRA methodology and criteria. Please refer to Draft EIR/EIS Section 3.4, Noise and Vibration, Impacts NV#2 and NV#6, which identify significant and unavoidable operational impacts related to noise, even after the application of numerous mitigation measures. The comment did not result in any revisions to the Draft EIR/EIS. California High-Speed Rail Authority June 2022 San Francisco to San Jose Project Section Final EIR/EIS Page | 20-713 7.b Packet Pg. 117 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2519 NV-MM#1 in Section 3.4.7, Mitigation Measures, discusses construction noise mitigation measures. NV-MM#1 requires the contractor to establish a construction noise monitoring program and implement measures to comply with FRA construction noise limits (an 8-hour Leq, dBA of 80 during the day and 70 at night for residential land use, 85 for both day and night for commercial land use, and 90 for both day and night for industrial land use) where a noise-sensitive receptor is present and wherever feasible. Measures for minimizing construction noise would include prohibiting certain noise- generating activities during nighttime hours, but due to the constraints of working within an active rail corridor some track realignments would require nighttime construction work that could exceed FRA construction noise limits at night. As described in mitigation measure NV-MM#1, the Authority would establish and maintain in operation until completion of construction a toll-free “hotline” regarding the project construction activities and would make a reasonable good-faith effort to address all noise concerns during construction. Accordingly, even with the implementation of NV-MM#1, the Draft EIR/EIS concludes that that some construction noise impacts would remain after mitigation, and the impact would be significant and unavoidable for both project alternatives. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2520 NV-IAMF#1 addresses both noise and vibration from construction. Consistent with typical construction practices contained in FTA and FRA guidelines for minimizing construction vibration, the contractor would route truck traffic away from residential streets, employ construction phasing, and use alternative construction methods to avoid the use of impact pile driving near vibration-sensitive land uses where possible. The contractor would document in a construction noise and vibration control plan how these measures would be employed to minimize construction vibration within 1,000 feet of sensitive receptors. Table 3.4-9 identifies the applicable FRA impact criteria that are the performance criteria the contractor must meet to avoid annoyance from construction vibration. As identified in Table 3.4-26, NV-MM#2 would be implemented to reduce this impact to less than significant levels under CEQA. NV-MM#2 would be effective in reducing human annoyance, as well as potential building damage. Additional information on the Authority’s noise and vibration mitigation guidelines is available in Appendix 3.4-B, Noise and Vibration Mitigation Guidelines. Changes in the sequence of operations and using alternative construction methods are available vibration mitigation options that will be identified in the required vibration control plan prepared by the contractor. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2521 Tables 3.4-23 and 3.4-24 in Section 3.4, Noise and Vibration, of the Draft EIR/EIS include the number of sensitive receptors that would experience moderate or severe noise impact before mitigation, with noise barriers, and with a combination of quiet zones and noise barriers. Additional detail regarding the specific noise impacts, levels, and locations before mitigation can be found in Volume 2, Appendix 3.4-A, Noise and Vibration Technical Report, in Tables 5-9 and 5-10, of the Draft EIR/EIS. Additional detail regarding the specific vibration impacts, levels, and locations before mitigation can be found in Tables 5-19 and 5-20. The comment did not result in any revisions to the Draft EIR/EIS. June 2022 California High-Speed Rail Authority Page | 20-714 San Francisco to San Jose Project Section Final EIR/EIS 7.b Packet Pg. 118 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2522 Refer to Standard Response FJ-Response-OUT-3: Local Government Permits. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2523 Refer to Standard Response FJ-Response-GS-1: Requests for Grade Separations. Regarding establishing quiet zones, please refer to Section 3.4.7, Mitigation Measures, NV-MM#4, that states quiet zones can only be legally undertaken by local jurisdictions. The Authority cannot legally establish or require a quiet zone. However, this measure has been revised in the Final EIR/EIS to clarify that HSR would assist with the preparation of technical analysis and materials needed for the quiet zone application, which would then be provided to local communities for submittal to the FRA. 1118-2524 Refer to Standard Response FJ-Response-OUT-2: Consultation with Local Agencies and Consistency with Local Regulations. The comment requests that intersections be evaluated based on the adopted Local Transportation Impact Analysis Policy in Palo Alto. The Local Transportation Impact Analysis Policy was adopted by the City of Palo Alto in June 2020 in conjunction with new CEQA VMT thresholds pursuant to SB 743. The Local Transportation Impact Analysis policy establishes a process for conducting transportation analysis outside of the CEQA process, specially to address compliance with the City of Palo Alto’s LOS policy. The stated purpose of the policy is to review and identify “transportation effects of proposed development projects.” The Local Transportation Impact Analysis Policy standards for determining whether a transportation impact analysis is required are based on the number of net new weekday (AM or PM peak hour) trips generated by a development project. The HSR project would not add any new vehicle trips to local intersections or roadways in the City of Palo Alto. As such, the HSR project would not be required to prepare a transportation impact analysis under the standards for determining transportation analysis in Palo Alto's Local Transportation Impact Analysis Policy. The Draft EIR/EIS does, however, evaluate LOS impacts at eight intersections in the City of Palo Alto, all adjacent to at-grade crossings. As CEQA was amended in 2018 to eliminate the use of LOS as a threshold to identify significant CEQA transportation impacts, the Draft EIR/EIS addresses LOS impacts for NEPA purposes only. The Authority identified a single LOS methodology and criterion to identify adverse effects under NEPA that is applied for intersections in all jurisdictions along the corridor, and for other corridors throughout the state, to provide a fair and consistent evaluation of project impacts. As described in Standard Response FJ-Response-OUT-2: Consultation with Local Agencies and Consistency with Local Regulations, the Authority is not subject to local government general plan policies or zoning regulations. However, while the analysis of intersection delays in the Draft EIR/EIS was not based on the City of Palo Alto’s Local Transportation Impact Analysis Policy, the criteria for evaluating NEPA LOS effects in the Draft EIR/EIS is based on the same LOS D standard applied in the City of Palo Alto Local Transportation Impact Analysis Policy. Please refer to Sections 3.2.4.4, Method for Evaluating Impacts under NEPA, and California High-Speed Rail Authority June 2022 San Francisco to San Jose Project Section Final EIR/EIS Page | 20-715 7.b Packet Pg. 119 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2524 3.2.4.5, Method for Determining Significance under CEQA, of the Draft EIR/EIS for a description of the methods and impact criteria incorporated within the transportation assessment. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2525 Refer to Standard Response FJ-Response-GS-1: Requests for Grade Separations, FJ- Response-SS-1: At-Grade Crossing Safety. The comment asserts that the Draft EIR/EIS does not analyze the potential hazards to school age pedestrians and bicyclists associated with increases in the number of trains and in train speeds. The comment also requests grade-separated crossings. These concerns are addressed by the standard responses referenced above. With regard to the assertion that the Draft EIR/EIS did not address project operation effects on children, please refer to Section 3.12, Socioeconomics and Communities. In this section, Impact SOCIO#6 specifically addresses the issues raised in the comment regarding children at at-grade crossings and found that the four-quadrant gates and perimeter fencing would improve safety conditions in the corridor. As there would be no disproportionate impacts on children’s health and safety due to project operations, no mitigation is required. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2526 The comment states that the project would increase gate-down time during peak hours by almost 67 percent, and that the impact on pedestrians and bicyclists must be analyzed and mitigated. Please refer to Impact TR#17 of Section 3.2, Transportation, of the Draft EIR/EIS, which evaluates pedestrian and bicycle impacts based on whether the project would conflict with a program, plan, ordinance, or policy regarding bicycle or pedestrian facilities, or otherwise materially decrease the performance of such facilities. The gate-down time for HSR trains at at-grade crossings in Palo Alto would range from 40 to 48 seconds depending on location. The addition of eight HSR trains during weekday peak hours would not have an effect on travel by pedestrians or bicyclists in Palo Alto about 90 percent of the time during peak hours when the crossing gates are not affected by HSR trains. For pedestrians or bicyclists arriving at the at-grade crossings in Palo Alto during the times when the gate is down for an HSR train, the wait time of up to 48 seconds is not considered a significant effect. The comment did not result in any revisions to the Draft EIR/EIS. June 2022 California High-Speed Rail Authority Page | 20-716 San Francisco to San Jose Project Section Final EIR/EIS 7.b Packet Pg. 120 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2527 The comment states that the Draft EIR/EIS identifies an impact at the intersections in Palo Alto and that the delay at the intersections would affect other modes of transportation including bicyclists, pedestrians, and bus transit. Regarding delay impacts on bus transit, please refer to Impact TR#5 in Section 3.2, Transportation, of the Draft EIR/EIS, which incorporates impacts on local bus transit into the analysis of vehicle congestion/delay. Local bus routes and shuttle services are part of the vehicle volumes that are evaluated to identify continuous permanent congestion/delay consequences on intersection operations. The Draft EIR/EIS indicates that adverse NEPA effects would occur at eight Palo Alto intersections adjacent to at-grade crossings including El Camino Real/Palo Alto Avenue/Sand Hill Road, Alma Street/Palo Alto Avenue, Alma Street/Churchill Avenue, Mariposa Avenue/Churchill Avenue, Park Boulevard/Meadow Drive, Park Boulevard/Charleston Road, Castilleja Avenue/Churchill Avenue, and Wilkie Way/West Charleston Road (Impact TR#5). Refer to TR-MM#1 in Section 3.2, Transportation, of the Final EIR/EIS for a discussion of the site-specific mitigation identified for adverse LOS effects; however no feasible mitigation was identified for intersections in Palo Alto that met the Authority’s policy on traffic mitigation. Please also refer to Standard Response FJ-Response-TR-1: Site-Specific Mitigation for Traffic Impacts, regarding how the Authority analyzed and is mitigating LOS impacts. Regarding delay impacts on bicyclists and pedestrians, please refer to Impacts TR#16 and TR#17, which evaluate pedestrian and bicycle impacts based on whether the project would conflict with a program, plan, ordinance, or policy regarding bicycle or pedestrian facilities, or otherwise materially decrease the performance of such facilities. The gate-down time for HSR trains at at-grade crossings in Palo Alto would range from 40 to 48 seconds. For pedestrians or bicyclists arriving at the Palo Alto at-grade crossings during the times when the gate is down for an HSR train, the wait time of up to 48 seconds is not considered a significant effect. 1118-2528 Refer to Standard Response FJ-Response-SS-1: At-Grade Crossing Safety, FJ- Response-TR-1: Site-Specific Mitigation for Traffic Impacts. The comment suggests that the Draft EIR/EIS should evaluate the effect of queues spilling onto through lanes, which would create safety hazards near at-grade crossings. The intersection LOS analysis methodology employed in the Draft EIR/EIS takes into the account the effect of queues created by added gate-down time at the at-grade crossings on the operations/LOS of intersections adjacent to the at-grade crossing. This analysis is reflected in Impact TR#5 in Section 3.2, Transportation, of the Draft EIR/EIS. Refer to TR-MM#1 in Section 3.2, Transportation, of the Final EIR/EIS for a discussion of the site-specific mitigation identified for adverse LOS effects. As discussed in Standard Response FJ-Response-TR-1: Site-Specific Mitigation for Traffic Impacts, the Authority developed site-specific mitigation for the Final EIR/EIS for certain locations where adverse NEPA traffic effects were identified. However, no feasible mitigation was identified that could address the effects at the intersections of El Camino Real/Palo Alto Avenue/Sand Hill Road, Alma Street/Palo Alto Avenue, Alma Street/Churchill Avenue, Mariposa Avenue/Churchill Avenue, Park Boulevard/Meadow Avenue, Park Boulevard/Charleston Road, Castilleja Avenue/Churchill Avenue, and Wilkie Way/West Charleston Road. The Authority will construct improvements at at-grade crossings, including four-quadrant gates where not currently present, consistent with FRA standards to address safety at all at-grade crossings. As discussed under Impact S&S#14 in Section 3.11, Safety and Security, the Draft EIR/EIS analysis found that installation of improvements to at-grade crossings, perimeter fencing, and four-quadrant gates would improve safety along the right-of-way, providing sufficient protections. Volume 3, Preliminary Engineering Plans, of the Draft EIR/EIS reflects a conceptual level of design for four-quadrant gate applications. The design for at-grade crossings would be refined as part of the final design in compliance with all relevant engineering standards, including MUTCD and CPUC GOs, and in coordination with CPUC. California High-Speed Rail Authority June 2022 San Francisco to San Jose Project Section Final EIR/EIS Page | 20-717 7.b Packet Pg. 121 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2529 Refer to Standard Response FJ-Response-TR-1: Site-Specific Mitigation for Traffic Impacts. The comment suggests that the project would significantly affect all modes of transit throughout the day and that impacts have not been properly identified. Please refer to Impact TR#11 in Section 3.2, Transportation, of the Draft EIR/EIS, which addresses the effects on high-frequency bus routes that operate near the HSR stations, maintenance facilities, or cross at-grade rail crossings. Significant effects due to added vehicle traffic in station areas or added gate-down time at at-grade rail crossings are identified for nine high-frequency bus routes. TR-MM#2 mitigates the effects identified in Impact TR#11. Local bus routes and shuttle services are part of the vehicle volumes that are evaluated to identify continuous permanent congestion/delay consequences on intersection operations in Impact TR#5. The Draft EIR/EIS indicates that an adverse NEPA effect would occur at eight Palo Alto intersections adjacent to at-grade crossings including El Camino Real/Palo Alto Avenue/Sand Hill Road, Alma Street/Palo Alto Avenue, Alma Street/Churchill Avenue, Mariposa Avenue/Churchill Avenue, Park Boulevard/Meadow Drive, Park Boulevard/Charleston Road, Castilleja Avenue/Churchill Avenue, and Wilkie Way/West Charleston Road. Refer to TR-MM#1 in Section 3.2 of the Final EIR/EIS for a discussion of the site-specific mitigation identified for adverse LOS effects; however, no feasible mitigation was identified for these intersections that met the Authority’s policy on traffic mitigation. 1118-2530 Refer to Standard Response FJ-Response-SS-1: At-Grade Crossing Safety. The commenter states that the HSR train speeds would reduce the reaction time for pedestrian, bicycle, and vehicle activities at at-grade crossings, and that the project would affect intersections adjacent to at-grade crossings that require improvements. FRA regulations require that at-grade crossing warning systems must provide at least 20 seconds warning time for normal train operations (49 C.F.R. Section 234.225) and require crossing gates to lower no sooner than 3 seconds after flashing light activation and to reach horizontal no later than 5 seconds before a train enters the crossing (49 C.F.R. Section 234.223). These requirements do not change for trains operating at 79 mph or 110 mph. Caltrain is the host railroad and is responsible for compliance withal FRA safety regulations with regard to track and warning systems and would be responsible to make any adjustments in gate activation and any connection to preemption of nearby traffic signal systems. As discussed in Standard Response FJ-Response-SS-1: At-Grade Crossing Safety, the Authority would install four-quadrant gates, median channelization, and fencing, which would improve at-grade crossing safety. In addition, Caltrain is upgrading its signal system, which will improve connections between onboard train systems and wayside signal operations. Caltrain conducts periodic hazard analysis to determine when crossings will be upgraded. CPUC regulations (CPUC General Order NO. 75-D) require that traffic signals at at-grade crossings with automatic warning devices be interconnected with the automatic warning devices at locations where a diagnostic team determines that preemption is necessary (e.g., where vehicular traffic queues from traffic signal-controlled intersections exceed the Clear Storage Distance as defined in the MUTCD). Caltrain would be responsible for preemption improvements with regard to blended service operations. Caltrain will meet all state (CPUC) and federal (FRA) requirements for railroad operations and signaling. For further information about Caltrain’s existing and future plans concerning signal systems, please refer to Standard Response FJ-Response-SS-1: At-Grade Crossing Safety. The comment did not result in any revisions to the Draft EIR/EIS. June 2022 California High-Speed Rail Authority Page | 20-718 San Francisco to San Jose Project Section Final EIR/EIS 7.b Packet Pg. 122 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2531 Refer to Standard Response FJ-Response-GS-1: Requests for Grade Separations, FJ- Response-SS-1: At-Grade Crossing Safety. The Authority acknowledges the City’s concern regarding the higher operating speeds of trains within the Caltrain corridor as compared to existing Caltrain speeds of 79 mph. As explained in Chapter 2, Alternatives, of the Draft EIR/EIS, with implementation of the HSR project, HSR trains and Caltrain trains would operate at speeds of up to 110 mph. Higher speeds are necessary for consistency with Proposition 1A travel time requirements for system design, which requires the HSR system to be designed to achieve maximum non-stop service times of 30 minutes between San Francisco and San Jose. Consistent with FRA safety guidelines for HSR systems with operating speeds of up to 110 mph, the blended system would install safety improvements (e.g., four-quadrant gates at at-grade crossings, perimeter fencing) to create a “sealed corridor” that would reduce conflicts with automobiles, bicycles, and pedestrians. The Draft EIR/EIS analysis under Impact S&S#14 found that installation of four-quadrant gates and median barriers consistent with FRA standards would improve safety along the right-of-way, providing sufficient protections. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2532 Please refer to the response to submission FJ-1118, comment 2531, which addresses the required design speeds needed for the project to remain consistent with Prop 1A. Due to this requirement, slower speed trains have not been evaluated, and are not required to be evaluated, in the EIR/EIS. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2533 Refer to Standard Response FJ-Response-OUT-2: Consultation with Local Agencies and Consistency with Local Regulations. The comment requests that the Draft EIR/EIS transportation analysis impacts and mitigations be studied in accordance with the adopted Local Transportation Impact Analysis Policy in Palo Alto. The Authority developed the methodology and significance criteria applied for the Draft EIR/EIS assessment in accordance with CEQA and NEPA guidelines. The Authority identified a single LOS criterion to identify adverse effects under NEPA that is applied for intersections in all jurisdictions along the corridor, and for other corridors throughout the state, to provide a fair and consistent evaluation of project impacts. As such, the analysis of intersection delays in the Draft EIR/EIS were not based on the City of Palo Alto’s Local Transportation Impact Analysis Policy on traffic Infusion and Residential Environment (TIRE). As described in Standard Response FJ- Response-OUT-2: Consultation with Local Agencies and Consistency with Local Regulations, the Authority is not subject to local government general plan policies or zoning regulations. Please refer to Sections 3.2.4.4, Method for Evaluating Impacts under NEPA, and 3.2.4.5, Method for Determining Significance under CEQA, of the Draft EIR/EIS for a description of the methods and impact criteria incorporated within the transportation assessment. Please refer also to Standard Response FJ-Response-TR-1: Site-Specific Mitigation for Traffic Impacts, regarding how the Authority analyzed and is mitigating LOS impacts. California High-Speed Rail Authority June 2022 San Francisco to San Jose Project Section Final EIR/EIS Page | 20-719 7.b Packet Pg. 123 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2534 As discussed under Impact TR#13, the project is expected to result in a 6.5 percent increase in Caltrain ridership due to HSR riders using Caltrain to reach HSR stations for outbound trips and for inbound riders to reach destinations not served by HSR. It is possible that increased ridership may increase demand for parking at other Caltrain stations. However, as explained in the EIR for the Caltrain Peninsula Corridor Electrification Project (PCJPB 2015b), Caltrain does not plan to meet unconstrained parking demand at its stations, particularly in the urbanized portions of the Caltrain service area. Caltrain’s 2010 Comprehensive Access Program Policy Statement emphasizes station access by walking, transit, and bicycling over automobile access at most stations. For transit center stations like Palo Alto, access priority for autos is the lowest priority after transit, walking, and bicycles. A parking deficit in and of itself, or the need to find a parking space off-site, while inconvenient, is not in and of itself a significant physical impact on the environment. Some station users unaware of the parking deficits may circle while looking for parking, but experienced station users will modify their behavior to take into account the parking deficits and take alternative actions. Those actions may include arriving earlier, using other nearby stations with available parking, using the kiss and ride, using parking areas further from the station, or accessing the station via other modes such as transit, biking or walking. Given Caltrain’s policy approach to station access, the increased riders generated by the increased demand for Caltrain service due to the HSR project are expected to be accommodated by modes other than personal vehicle parking or by behavioral shifts. As such, there would be no significant physical impact on the environment and no requirement for mitigation. The comment does not identify any inadequacies in the analysis in the Draft EIR/EIS and no revisions are necessary. 1118-2535 Refer to Standard Response FJ-Response-TR-1: Site-Specific Mitigation for Traffic Impacts. The comment suggests that the project would significantly affect bus service on Alma Avenue. While the Draft EIR/EIS does not specifically identify individual local bus service routes, impacts on local bus transit are incorporated into the analysis of intersection operations. Please refer to Impact TR#5 in Section 3.2, Transportation, which analyzes local bus routes as part of the vehicle volumes that are evaluated to identify continuous permanent congestion/delay consequences on intersection operations. The Draft EIR/EIS indicates that an adverse NEPA effect would occur at eight Palo Alto intersections adjacent to at-grade crossings, including Alma Street/Palo Alto Avenue and Alma Street/Churchill Avenue. Local bus services are incorporated into this effect on intersection operations. Refer to TR-MM#1 in Section 3.2 of the Final EIR/EIS for a discussion of the site-specific mitigation identified for adverse LOS effects. No feasible mitigation was identified that could address the effects at the intersections of Alma Street/Palo Alto Avenue and Alma Street/Churchill Avenue. 1118-2536 Refer to Standard Response FJ-Response-GS-1: Requests for Grade Separations, FJ- Response-SS-2: Emergency Vehicle Response Times. The comment asserts that the Draft EIR/EIS must evaluate grade separation for at- grade crossings as mitigation measures for effects to emergency response times. The Draft EIR/EIS evaluation of continuous permanent impacts on emergency access and response times due to increased gate-down time under Impact S&S#6 concluded that there would be a significant impact along the Menlo Park/Palo Alto boundary in the areas west of El Camino Real and north of Sand Hill Road, but not for other portions of the City of Palo Alto. Mitigation Measure SS-MM#4, which calls for installing emergency vehicle priority treatments related to increased gate-down time impacts, indicates that the Authority and a local agency may make a mutual agreement to have the Authority make an in-lieu payment towards other infrastructure projects, as an alternative to the listed emergency vehicle priority treatments, including nearby grade-separation projects. June 2022 California High-Speed Rail Authority Page | 20-720 San Francisco to San Jose Project Section Final EIR/EIS 7.b Packet Pg. 124 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2537 The comment states that the Draft EIR/EIS must evaluate and mitigate the impacts on the root-structure from grading or the use of vibratory equipment for track work within 10 feet of the Historic El Palo Alto Tree. The El Palo Alto redwood tree is located adjacent to the Caltrain right-of-way, and the tree branches and foliage are located within 5 feet of the right-of-way. As part of Caltrain PCEP, Caltrain will be performing some limited tree trimming that an arborist has determined will not compromise the health of the tree and will be installing OCS poles along the opposite side of the tracks to minimize effects on tree roots. As part of the HSR project, minor horizontal track shifts would be required further westward, away from the tree. This would be done using track-mounted equipment that would operate along the existing Caltrain track as it adjusts track and ballast; this equipment operates in a similar way to existing train operations in the Caltrain corridor. As the track bed is already compacted and the track adjustments would be shifting track further from El Palo Alto, it is not anticipated that additional compaction or vibratory impacts beyond the existing conditions would occur. Please refer to BIO-MM#39 of the Draft EIR/EIS, which requires the project biologist to establish environmentally sensitive areas around protected trees with the potential to be affected by construction activities. The intent of this measure is to avoid construction impacts on protected trees. Although, a 10 foot buffer will not be possible in this location, the Historic El Palo Alto Tree would be protected by the largest feasibly possible environmentally sensitive area, which would minimize root structure grading and vibratory impacts. BIO-MM#39 has been updated to reflect that locations near protected trees where a 10 foot buffer is not possible will have the largest possible buffer employed to avoid and minimize impacts. 1118-2538 The comment states that construction-related vibration could indirectly affect existing City of Palo Alto utility infrastructure in the vicinity of the project, particularly infrastructure that crosses the railroad tracks. Anticipated construction work within the city of Palo Alto is limited to minor track shifts, installation of four-quadrant gates, and standalone radio towers. These activities would not be substantial sources of construction-related vibration and therefore significant indirect vibration impacts on utilities are not expected and mitigation is not required. Any work in proximity to City- owned utilities would be coordinated with the City, and the Authority generally ensures that overall local government facilities and utilities function in a materially equivalent manner to prior to the relocations, modifications, or impact. This comment does not require any revisions to the Draft EIR/EIS. 1118-2539 The issue of temporary disruptions to utilities is acknowledged and explained at length in Impact PUE#1 in Section 3.6, Public Utilities and Energy, of the Draft EIR/EIS. Impact PUE#1 states that planned, temporary interruptions of major utility service to public utility customers could occur during construction at any given location and could interrupt utility services to industrial, commercial, and residential customers. Impact PUE#1 explains that the alternatives incorporate PUE-IAMF#3, which provides for advance notification of planned temporary outages. The alternatives also incorporate PUE-IAMF#4, which further commits the Authority to coordinate with utility providers such that outages can be avoided or minimized. Neither CEQA, NEPA, nor any other pertinent regulation require that outage durations be precisely defined or that the Authority speculate on the durations of such outages. The Authority recognizes that outages are inconvenient to surrounding utility users, but for health and safety purposes, some temporary outages would be required. The comment did not result in any revisions to the Draft EIR/EIS. California High-Speed Rail Authority June 2022 San Francisco to San Jose Project Section Final EIR/EIS Page | 20-721 7.b Packet Pg. 125 Chapter 20 Local Agency Comments Response to Submission 1118 (Ed Shikada, City of Palo Alto, September 9, 2020) - Continued 1118-2540 As shown in Table 3.4-21 in Section 3.4, Noise and Vibration, of the Draft EIR/EIS there are numerous locations where noise barriers would be considered in Palo Alto. Mature vegetation already exists outside the railway right-of-way in most potential noise barrier locations to shield views from residences and other sensitive receptors. In locations where existing landscaping is minimal, AVQ-MM#4 and AVQ-MM#5 detail landscaping mitigations along the HSR corridor. Additionally, in accordance with AVQ-MM#6 as part of the final design and construction management plan, the Authority would work with local jurisdictions to develop the appropriate noise barrier style and treatments for visually sensitive areas, to reduce the visual effect of barriers on adjacent land uses. With respect to the commenter’s question about whether the Authority would retain or replant existing vegetation along the right-of-way, the Authority would replace removed trees based upon local jurisdictional requirements consistent with AVQ-MM#1. The comment did not result in any revisions to the Draft EIR/EIS. 1118-2541 The comment is noted but does not raise any specific concern regarding the conclusions or adequacy of the Draft EIR/EIS, nor did it result in any revisions to the Draft EIR/EIS. Appendix 2-I, Regional and Local Plans and Policies, of the Draft EIR/EIS includes a summary of the tree requirements in the Palo Alto Municipal Code. The project would replace trees in accordance with the City of Palo Alto’s Tree Technical Manual and use the City of Palo Alto’s required tree replacement ratios if they are greater than a 1:1 ratio. June 2022 California High-Speed Rail Authority Page | 20-722 San Francisco to San Jose Project Section Final EIR/EIS 7.b Packet Pg. 126 City of Palo Alto (ID # 14538) Office of the City Clerk City Council CAO Report Meeting Date: 8/8/2022 Report Type: Action Items Title: Designation of Voting Delegate and Alternate for the League of California Cities Annual 2022 Conference, to be held September 7-9 in Long Beach, CA From: Lesley Milton, City Clerk The City Council should consider attendees Council Member Cormack, Vice Mayor Kou, or Mayor Burt and designate one council member as the voting delegate and two council members as alternate voting delegates for the 2022 League of California Cities Annual Conference. BACKGROUND: The League’s 2022 Annual Conference is scheduled for September 7-9, 2022 in Long Beach. An important part of the Annual Conference is the Annual Business Meeting scheduled for noon on Friday, September 9 at the Long Beach Convention Center. At this meeting, the League membership considers and takes action on resolutions that establish League policy. The resolutions will be agendized for Council consideration prior to the conference. In order to vote at the Annual Business Meeting, the City Council must delegate a voting delegate and could appoint up to two alternate voting delegates. At this time only Council Member Cormack and Vice Mayor Kou and Mayor Burt have expressed interest in attending. Please find attached correspondence received from the League of California Cities. FISCAL IMPACT: 8 Packet Pg. 127 Page 2 There is no fiscal impact associated with this item. ATTACHMENTS: • Attachment8.a: 2022 Annual Conference Voting Delegate Alternate Form (PDF) 8 Packet Pg. 128 8.a Packet Pg. 129 8.a Packet Pg. 130 8.a Packet Pg. 131 8.a Packet Pg. 132 City of Palo Alto (ID # 13998) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Information Reports City of Palo Alto Page 1 Title: Investment Activity Report for the Fourth Quarter, Fiscal Year 2022 From: City Manager Lead Department: Administrative Services Background The City’s Investment Policy requires that staff report to Council quarterly on the City’s portfolio composition and performance compared to the Council -adopted policy; discuss overall compliance with the City’s Investment Policy; and provide recommendations, if any, for policy changes. In addition, staff provides a detailed list of all securities and report on the City’s ability to meet expenditure requirements over the next six months. This report is to inform Council of the City’s investment portfolio performance as of the fourth quarter ending June 30, 2022 and to disclose staff’s cash flow projections for the next six months. The report includes a discussion of the sale of investments prior to maturity, which occurred in July 2022 to meet higher than expected cash flow needs and resulted in a small principal gain of $3,519. Discussion The City’s investment portfolio is summarized in Graph 1 and detailed in the Investments by Fund Report (Attachment B). The Investments by Fund Report groups the portfolio’s securities by investment type and includes details of the investment issuer, date of maturity, current market value, the book and face (par) value, and the weighted average maturity of each type of investment and of the entire portfolio. 9 Packet Pg. 133 City of Palo Alto Page 2 The par value of the City’s portfolio is $584.7 million; in comparison, last quarter it was $575.9 million. The $8.8 million portfolio growth since the last quarter results from expected and typical timing of cash flows. Contributing factors include the continued rebound of the local economy, second year of pandemic federal aid of $6.9 million, and property tax receipts including Excess ERAF (Educational Revenue Augmentation Funds) totaling $27.7 million. These sources are partially offset by an extra pay period cost in the fourth quarter compared to the third quarter and restoration of some City services. The portfolio consists of $46.6 million in liquid accounts and $538.1 million in various investment types as detailed in the following Table 1. The investment policy requires that at least $50 million be maintained in securities maturing in less than two years. The portfolio includes $107.5 million in investments maturing in less than two years, comprising 18.4 percent of the City’s investment portfolio. In addition, the Investment Policy allows up to 30 percent of the portfolio to be invested in securities with maturities beyond five years; actual at the end of the second quarter is 28.0 percent of the portfolio. 9 Packet Pg. 134 City of Palo Alto Page 3 The current market value of the portfolio is 93.5 percent of the book value. The market value of securities fluctuates, depending on how interest rates perform. When interest rates decrease, the market value of the securities in the City’s portfolio will like ly increase; likewise, when interest rates increase, the market value of the securities will likely decrease. Understanding and showing market values is not only a reporting requirement, but essential to knowing the principal risks in actively buying and selling securities. It is important to note, however, that the City’s practice is to buy and hold investments until they mature so changes in market price do not affect the City’s investment principal. As a result, there’s no risk of principal loss due to the declining market value. The market valuation is provided by U.S. Bank, which is the City’s safekeeping agent. The average life to maturity of the investment portfolio is 3.85 years compared to 4.12 years last quarter. The Investment Policy states “Should the ratio of the market value of the portfolio to the book value of the portfolio fall below 95 percent, the Administrative Services Department will report this fact to the City Council within a reasonable time frame and evaluate whether there is an y risk of holding any of the securities to maturity.” At the end of the fourth quarter, the market value of the City’s investment portfolio fell to 93.5 percent. Interest rates are expected to further increase causing market value of the portfolio to fluctuate. A key investment objective in the City’s Investment Policy is safety, where investments are undertaken in a manner to ensure the preservation of capital in the overall investment portfolio. This guided the City’s practice is to buy and hold investments to mature; this minimizes the investment risk in this fluctuating market. As of writing of this report (last week of July 2022), market value was 97.2 percent. Investments Made During the Fourth Quarter During the fourth quarter, $12.8 million of securities with an average yield of 2.1 percent matured. During the same period, per the following Table 2, securities totaling $3.9 million 9 Packet Pg. 135 City of Palo Alto Page 4 with an average yield of 3.0 percent were purchased. As expected, as interest rates slowly rose on new investments, the City’s portfolio’s average yield plateaued in this and the prior few quarters and the portfolio’s average yield is expected to eventually rise due to higher yielding new investments. In the prior two fiscal years or during the height of the COVID -19 economic closures, the portfolio’s interest rate had steadily declined. The City’s short -term money market and pool account increased by $17.7 million compared to the third quarter of Fiscal Year 2022. Staff continually monitors the City’s short-term cash flow needs and adjusts liquid funds to meet them. Availability of Funds for the Next Six Months Typically, the flow of revenues from the City’s utility billings and General Fund sources is enough to provide funds for ongoing expenditures in those respecti ve funds. Projections indicate that for the City’s cashflow, an overall decline in the portfolio of $34.1 million is expected over the coming six months due to routine business needs. This reflects expected receipts of $290.7 million and expenditures of $324.8 million over the next six months. The expected decline in the portfolio is attributable to pre-paying a portion of the Fiscal Year 2023 Public Employers’ Retirement System’s (PERS) employer contribution of $43.1 million, representing the City’s unfunded accrued liability (UAL) lump-sum prepayment for FY 2023. This has occurred for the past five years with this payment being the sixth. By prepaying PERS instead of making payments with each payroll period, the City is expected to save $1.5 million in pension expense; the savings will be offset by the loss of approximately $0.8 million in interest income in the City’s investment portfolio, resulting in net citywide savings of $0.7 million. As of June 30, 2022, the City had $46.6 million deposited in the Local Agency Investment Fund (LAIF) and a money market account that could be withdrawn to satisfy daily liquid cash 9 Packet Pg. 136 City of Palo Alto Page 5 requirements. Table 1 cites that investments totaling $122.8 million will mature within 12 months; of that amount, $35.2 million will mature between July 1, 2022 and December 31, 2022. Staff expects that the City will have adequate funds to meet expenditure requirements for the next six months. Sale of Investments Prior to Maturity (July 2022) As mentioned earlier in this report, a primary objective of the City’s Investment Policy is safety with preservation of capital being the approach in the execution of investment activities. The sale of securities is permitted in the Investment Policy (see p. 8) and was authorized by the Director of Administrative Services to maintain required liquid cash for daily City operations. Staff forecasts both short-term and long-term cash needs and ladders the investments accordingly so there is adequate cash on hand combined with maturing investments to meet the forecasted liquidity needs. In the latter part of the fourth quarter (Q4) of Fiscal Year 2022, due to timing of capital expense and rise in utility commodity costs, there was a need to sell investments prior to maturity to ensure sufficient liquid cash balances for potentially the higher than capital costs in July 2022. As a result, a one-time sale of $10.7 million (par value) in securities was completed in early July 2022 for a net principal gain of $3,519. These security sales provided extra payment flexibility and lowered the July’s liquidity risk. Overall FY 2022 regular warrants (Accounts Payable) and purchase card payments increased by $74.4 million, or 28.9 percent, over the prior year. Going forward staff has adjusted cash projections to consider the higher expenditure levels. As a result, future near-term security sales are not anticipated. Revenues receipts remain within trend and are expected to keep up with the above higher costs. In addition, investments that are scheduled to mature in August and September are sufficient to maintain the City’s liquid cash requirements. Should the conservative outlook not materialize, these funds can be reinvested in a few months in higher yielding securities since the interest rates on new investments is expected to continue to rise in the coming months and quarters as the federal government increase interest rates to address the elevated inflation rate. Compliance with City Investment Policy During the fourth quarter, staff complied with all aspects of the investment policy. Attachment C lists the major restrictions in the City’s investment policy compared w ith the portfolio’s actual performance. Investment Yields Interest income on an accrual basis for the fourth quarter was $2.4 million; $0.1 million higher than the prior quarter. As of June 30, 2022, the yield to maturity of the City’s portfolio was 1.62 percent; in the prior quarter it was similar or at 1.61 percent. In the fourth quarter, LAIF’s average yield was 0.69 percent while the average yield on the two-year and five-year Treasury bonds was approximately 2.72 percent and 2.95 percent, respectively. In comparison, in the 9 Packet Pg. 137 City of Palo Alto Page 6 prior quarter LAIF had 0.29 percent yield and the two-year and five-year Treasury bonds yields were significantly lower at 1.43 percent and 1.81 percent. Historically, the City’s portfolio yield has outperformed the two-year and five-year Treasury bond rates and did so again starting over two years ago; this is an expected occurrence during economic downturns. However, during economic recovery periods, interest rates rise and the City’s portfolio yield is expected to be lower, as is the current financial environment. As the City’s laddered portfolio investments mature in the next year or two, funds will continue to be reinvested and trends will follow the economic patterns. Graph 2 shows the City’s yields and interest earnings for the past 20 years. 5.88% 5.00% 4.17% 4.54% City of Palo Alto 2.71% 1.80%1.93% 1.62% 1.41% 0.81%0.25% 2 Yr. Treasury 2.72% 4.39% 4.98% 1.10% 5-Yr. Treasury 2.88% 2.47% 0.27% 2.95% 1.44% 5.25% 0.23% LAIF 0.69% $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 $4.5 $5.0 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% Int. Earnings (Millions)Yields Fiscal Year Quarters Graph 2: Yields and Interest Earnings City’s portfolio duration is 3.85 years. Yield Trends The Federal Open Market Committee (FOMC), after 17 consecutive meetings, since March 2020, has raised the federal funds rate three times totaling 1.50 percent with the first occu rring on March 16, 2022. The third occurred on June 15, 2022 with the rate increase being 0.75 percent (1.50 percent to 1.75 percent). Prior to this the rate was near zero. In order to mitigate the persistent elevated inflation rate, the expectation is FOMC will continue to do multiple federal funds rate interest rate increases in the second half of 2022 and 2023. Consistent with the prior quarter, job growth remains “robust” and unemployment rate remains low, however, FOMC’s inflation concern are “reflecting supply and demand imbalances related to the pandemic, higher energy prices, and broader price pressures.” In addition, they state “lockdowns in China are likely to exacerbate supply chain disruptions.” The following Graph 3 9 Packet Pg. 138 City of Palo Alto Page 7 shows the U.S. inflation rate trend for FY 2022. The FOMC’s target rate, ideally, is to bring the inflation rate to around 2 percent. Graph 3: U.S. Inflation Rate Funds Held by the City or Managed Under Contract Attachment A is a consolidated report of all City investment funds, including those not held directly in the investment portfolio. These include cash in the City’s regular bank account with US Bank and Wells Fargo. A description of the City’s banking relationships can be found in City Council Staff Report ID # 7858 and ID # 11402. The bond proceeds, reserves, and debt service payments being held by the City’s fiscal agents are subject to the requirements of the underlying debt indenture. The trustees for the bond funds are U.S. Bank and California Asset Management Program (CAMP). Bond funds with U.S. Bank are invested in federal agency and money market mutual funds that consist exclusively of U.S. Treasury securities. Bond funds in CAMP are invested in banker’s acceptance notes, certificates of deposit, commercial paper, federal agency securities, and repurchase agreements. The most recent data on funds held by the fiscal agent is as of June 30, 2022. In January 2017, the City established a Section 115 Irrevocable Trust (Public Agencies Post - Employment Benefits Trust) administered by Public Agency Retirement Services (PARS). This fund is not governed by the City’s Investment Policy; however, it is discussed in this report to present the full picture of the City’s investments. It is the City’s intent to prefund pension costs and began to address the Net Pension Liabilities (NPL) as calculated by Governmental Accounting Standards Board Pronouncement No. 68 (GASB 68). The Section 115 Trust offered by PARS has five portfolios from which to choose in making investments of City funds. The City has selected the “Moderately Conservative” portfolio which is the second most conservative. Additional information on this trust can be found in City Council Staff Report ID # 7553. Through June 30, 2022, principal investment contributions of $38.3 million made over time 9 Packet Pg. 139 City of Palo Alto Page 8 since May 2017, have grown to $39.0 million and the net return for one and three years has been -9.90 percent and 2.17 percent respectively. Resource Impact This is an information report discussing the previous three months and the information presented does not result in a financial impact. Environmental Review This information report is not a project under the California Environmental Quality Act; therefore, an environmental review is not required. . Attachments: • Attachment9.a: Attachment A Consolidated Report of Cash Management • Attachment9.b: Attachment B Investment Portfolio • Attachment9.c: Attachment C Investment Policy Compliance 9 Packet Pg. 140 Book Value Market Value City Investment Portfolio (see Attachment B)590,753,786$ 552,545,617$ Other Funds Held by the City Cash with Wells Fargo Bank 217,733 217,733 (includes general and imprest accounts) Cash with US Bank 2,255,286 2,255,286 (includes general and imprest accounts) Petty/Working Cash 11,927 11,927 Total - Other Funds Held By City 2,484,946 2,484,946 Funds Under Management of Third Party Trustees * Debt Service Proceeds US Bank Trust Services ** 1999 Utility Revenue Bonds Debt Service Fund 82 82 2009 Water Revenue Bonds (Build America Bonds) Debt Service and Reserve Funds 2,551,358 2,551,358 2010 & 2013 General Obligation (Library) Bond Debt Service and Escrow Funds 2,927,702 2,927,702 2011 Utility Revenue Refunding Bonds Debt Service and Reserve Funds 789,151 789,151 2012 University Ave. Parking Refunding Bonds Reserve and Escrow Funds 1,677,540 1,677,540 2018 Capital Improvement (Golf Course & 2002B COP Refinance) (Taxable- Green Bond) Certificates of Participation Debt Service and Cost of Issuance Funds 1 1 2021 Public Safety Building Certificates of Participation Construction Debt Svc, Capitalized Interest, and Cost of Issuan 49,704,763 49,704,763 California Asset Management Program (CAMP) *** 2012 University Ave. Parking Refunding Bonds Reserve Fund 2,712,382 2,712,382 2013 General Obligation (Library) Bond Reserve Fund 251,072 251,072 Public Agencies Post-Employment Benefits Trust **** Public Agency Retirement Services (PARS) 39,039,274 39,039,274 Total Under Trustee Management 99,653,325 99,653,325 GRAND TOTAL 692,892,057$ 654,683,888$ * These funds are subject to the requirements of the underlying debt indenture. ** U.S. Bank investments are in money market mutual funds that exclusively invest in U.S. Treasury securities. *** CAMP investments are in money market mutual fund which invest in bankers acceptance, certificate of deposit, commercial paper, federal agency securities, and repurchase agreements. **** PARS investments are in moderately conservative index plus funds Attachment A Fourth Quarter, Fiscal Year 2021-22 (Unaudited) Consolidated Report of Cash Management City of Palo Alto Cash and Investments 9.a Packet Pg. 141 City of Palo Alto City of Palo Alto Administration Svcs. Dept. 250 Hamilton Ave., 4th Floor Palo Alto, CA 94301 (650)329-2362 June 30, 2022 Fund ALL - Portfolio Listings Investments by Fund Par Value Days To Maturity Maturity Date Current RateMarket ValueCUSIPInvestment # Issuer Purchase Date Book Value YTM 360 YTM 365 LAIF & Fidelity Cash Accounts Fidelity Investments158 3,717,486.48SYS158 11.23007/01/2020 3,717,486.48 1.213 1.2303,717,486.48 Local Agency Investment Fund159 42,921,049.99SYS159 10.94007/01/2020 42,438,340.03 0.927 0.94042,921,049.99 Subtotal and Average 46,638,536.47 46,638,536.47 46,155,826.51 0.950 0.963 1 Negotiable Certificates of Deposits Comenity Capital Bank1959 NCD 245,000.0020033AM86 10/30/2023 4863.45010/30/2018 246,408.75 3.404 3.451245,000.00 American Federal Bank1476 NCD 245,000.0002600ADE4 09/30/2022 912.45009/30/2015 245,392.00 2.418 2.451245,000.00 Allegiance Bank - Texas1844 NCD 245,000.0001748DAW6 09/29/2022 902.05009/29/2017 245,149.45 2.022 2.051245,000.00 Alpine Bank1525 NCD 245,000.0002082CBG4 08/16/2023 4112.40002/16/2016 243,586.35 2.367 2.400245,000.00 Aneca Federal Credit Union2298 NCD 249,000.00034577AN6 03/20/2025 9931.10003/20/2020 234,304.02 1.085 1.100249,000.00 American State Bank OSCE1805 NCD 245,000.00029733BX9 05/30/2024 6992.30005/30/2017 240,614.50 2.270 2.301245,000.00 American Express Centurion Bk1986 NCD 245,000.0002589AA28 12/04/2023 5213.55012/04/2018 246,697.85 3.501 3.550245,000.00 Banner Capital Bank2453 NCD 249,000.0006654HAA6 11/28/2025 1,2460.45011/27/2020 225,539.22 0.493 0.500248,575.46 Bank of Wisconsin Dells2455 NCD 249,000.00065847EH4 07/28/2025 1,1231.05011/23/2020 231,953.46 0.542 0.549252,780.78 Beal Bank - Plano, TX2668 NCD 249,000.0007371AYT4 02/24/2027 1,6992.05003/02/2022 234,465.87 2.053 2.081248,651.33 Texas Exchange Bank2346 NCD 249,000.0088241THJ2 06/13/2025 1,0781.00006/02/2020 232,262.22 0.986 1.000249,000.00 Bank West1472 NCD 245,000.00063615AX6 09/16/2022 772.25009/16/2015 245,232.75 2.220 2.251245,000.00 Apex Bank1693 NCD 245,000.0003753XAN0 09/30/2022 911.70009/30/2016 244,936.30 1.676 1.700245,000.00 Century Next Bank2074 NCD 245,000.00156634AY3 08/30/2024 7911.70008/30/2019 236,719.00 1.678 1.701245,000.00 BankUnited NA2474 NCD 249,000.00066519QC6 01/22/2026 1,3010.55001/22/2021 225,536.73 0.592 0.600248,556.48 BMO Harris Bank2480 NCD 249,000.0005600XBX7 10/27/2028 2,3101.00001/27/2021 213,629.55 1.019 1.034248,491.88 BMW Bank of North America2448 NCD 249,000.0005580AXU3 11/20/2025 1,2380.50011/20/2020 226,174.17 0.493 0.500249,000.00 Beal Bank USA - Las Vegas, NV2669 NCD 249,000.0007371CH69 02/24/2027 1,6992.05003/02/2022 234,465.87 2.053 2.081248,651.33 Balboa Thrift & Loan1984 NCD 245,000.0005765LAW7 11/30/2022 1523.25011/30/2018 246,266.65 3.207 3.252245,000.00 Citigroup1950 NCD 245,000.0017312QJ67 04/22/2023 2953.00004/24/2018 245,894.25245,000.00 Encore Bank2343 NCD 249,000.0029260MBH7 05/21/2027 1,7851.15005/21/2020 223,375.41 1.134 1.150249,000.00 First Carolina Bank2389 NCD 248,000.0031944MBB0 08/20/2025 1,1460.45008/20/2020 226,300.00 0.444 0.450248,000.00 Celtic Bank2063 NCD 245,000.0015118RRH2 08/30/2024 7911.85008/30/2019 237,488.30 1.826 1.852245,000.00 Central State Bank IOWA2324 NCD 249,000.0015523RCP9 03/27/2025 1,0001.00003/27/2020 233,542.08 1.189 1.206247,636.36 Choice Bank - Oshkosh WI1884 NCD 245,000.0017037VBT8 12/29/2022 1812.35012/29/2017 245,306.25 2.317 2.350245,000.00 Cinfed Fed Credtit Union Bank2504 NCD 249,000.0017248MAC1 03/04/2027 1,7070.65003/04/2021 219,259.44 0.691 0.701248,418.02 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 Attachment B9.b Packet Pg. 142 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 2 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits Citadel Federal Credit Union2267 NCD 245,000.0017286TAG0 02/27/2025 9721.65002/27/2020 234,322.90 1.668 1.691244,739.31 Citizens State Bank1541 NCD 250,000.0017670BAQ1 02/17/2023 2311.75002/19/2016 249,172.50 1.727 1.751250,000.00 Commercial Savings Bank1868 NCD 245,000.00202291AD2 10/18/2022 1092.10010/18/2017 245,169.05 2.071 2.100245,000.00 Enerbank USA2215 NCD 245,000.0029278TMR8 01/29/2025 9431.80001/29/2020 235,567.50 1.779 1.803245,000.00 Connexus Credit Union2643 NCD 249,000.0020825WAR1 12/23/2026 1,6361.25012/23/2021 226,806.63 1.273 1.291248,553.82 Capital One Bank USA NA2089 NCD 245,000.0014042TCP0 09/05/2024 7971.90009/05/2019 237,725.95 1.873 1.900245,000.00 Capital One Bank USA NA2609 NCD 249,000.0014042RQB0 11/17/2026 1,6001.10011/17/2021 225,965.01 1.084 1.100249,000.00 Community State Bank, IA1471 NCD 245,000.0020404MAN1 09/12/2022 732.25009/11/2015 245,220.50 2.224 2.255245,000.00 Crescent Bank & Trust2296 NCD 248,000.00225645DN7 03/20/2025 9931.10003/20/2020 233,363.04 1.085 1.100248,000.00 Country Club Bank2477 NCD 249,000.00222327AD0 01/29/2030 2,7691.10001/29/2021 207,613.71 1.154 1.170247,741.44 Delta Natl Bank & TR2670 NCD 249,000.0024773RCR4 02/25/2027 1,7002.00003/09/2022 233,920.56 1.975 2.003249,000.00 Discover Bank / Delaware1956 NCD 245,000.00254673VJ2 10/24/2023 4803.35010/24/2018 246,085.35 3.304 3.350245,000.00 Eaglemark Savings Bank2545 NCD 249,000.0027004PBV4 07/07/2026 1,4670.85007/07/2021 225,788.22 0.919 0.932248,199.82 Eagle Bank2040 NCD 245,000.0027002YEL6 04/28/2023 3012.65004/30/2019 245,171.50 2.615 2.651245,000.00 Farmers & Merchant State Bank2486 NCD 249,000.00308682BM4 02/12/2029 2,4181.00002/12/2021 211,886.55 1.037 1.052248,175.79 Flagstar Bank FSB2414 NCD 249,000.0033847E4E4 09/30/2024 8220.40009/30/2020 233,295.57 0.394 0.400249,000.00 Poppy Bank2285 NCD 249,000.0073319FAF6 03/18/2025 9911.10003/18/2020 234,336.39 1.085 1.100249,000.00 First Federal S&L Bank1626 NCD 245,000.0032018YAW8 06/22/2023 3561.80006/22/2016 242,812.15 1.776 1.800245,000.00 1st Financial Bank2390 NCD 248,000.0032022RNT0 08/19/2025 1,1450.45008/19/2020 226,317.36 0.444 0.450248,000.00 First Farmers Bank & Trust2076 NCD 245,000.00320165JK0 09/04/2024 7961.75009/04/2019 236,939.50 1.727 1.751245,000.00 First Internet Bank1834 NCD 245,000.0032056GCQ1 07/14/2022 132.05007/14/2017 245,034.30 2.023 2.051245,000.00 Farmers Insurance Group CU2479 NCD 249,000.0030960QAK3 01/27/2026 1,3060.50001/27/2021 224,971.50 0.543 0.550248,554.77 First Oklahoma Bank2451 NCD 249,000.00335857CK2 11/30/2026 1,6130.65011/30/2020 221,027.34 0.691 0.701248,450.06 Farmers &Merchants Bank2644 NCD 249,000.00307811DM8 01/22/2030 2,7621.60001/14/2022 216,034.89 1.630 1.653248,061.11 First National Bank of America2465 NCD 249,000.0032110YRQ0 12/31/2026 1,6440.60012/31/2020 219,899.37 0.625 0.633248,626.33 FNB Bank Inc.1863 NCD 245,000.00330459CB2 10/13/2023 4692.25010/13/2017 242,714.15 2.220 2.251245,000.00 First Northeast Bank1779 NCD 245,000.0033583FAA0 10/19/2022 1102.10004/19/2017 245,171.50 2.072 2.101245,000.00 First Technology Federal Credi1955 NCD 245,000.0033715LCM0 10/17/2023 4733.40010/17/2018 246,261.75 3.355 3.401245,000.00 First Community Credit Union2554 NCD 249,000.0031986JAD3 02/26/2027 1,7010.85007/28/2021 221,532.81 0.892 0.905248,376.83 Firstier Bank2061 NCD 245,000.0033766LAJ7 08/23/2024 7841.95008/23/2019 238,078.75 1.925 1.952245,000.00 First Kentucky Bank1856 NCD 245,000.0032065TAW1 10/06/2022 972.10010/06/2017 245,178.85 2.072 2.101245,000.00 Gesa Credit Union2456 NCD 249,000.0037424PAC8 11/30/2027 1,9780.80011/30/2020 216,201.72 0.825 0.836248,518.27 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 143 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 3 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits Great Plains Bank1865 NCD 245,000.0039115UBB8 07/25/2022 242.00010/25/2017 245,051.45 1.972 2.000245,000.00 Grant County Bank West V.2042 NCD 245,000.00387625AA4 05/08/2024 6772.55005/08/2019 241,971.80 2.513 2.548245,000.00 Goldman Sachs Bank USA / NY1951 NCD 245,000.0038148PJ81 05/09/2023 3123.15005/09/2018 246,104.95 3.106 3.150245,000.00 Haddon Savings Bank2447 NCD 207,000.00404730DA8 10/20/2025 1,2070.35011/16/2020 187,486.11 0.491 0.498205,750.06 Bank Hapoalim BM2457 NCD 249,000.0006251A2Q2 12/15/2025 1,2630.50012/14/2020 225,763.32 0.543 0.550248,569.67 Investors Community Bank1765 NCD 245,000.0046147USQ4 09/23/2022 842.20003/24/2017 245,227.85 2.172 2.202245,000.00 Inst. for Sav in Newburyport2556 NCD 249,000.0045780PAQ8 07/29/2026 1,4890.90007/29/2021 225,718.50 0.888 0.900249,000.00 Jonesboro State Bank2452 NCD 249,000.0048040PJL0 11/26/2027 1,9740.75011/27/2020 215,653.92 0.790 0.801248,326.68 Kansas State Bank Manhattan1798 NCD 245,000.0050116CAX7 05/31/2024 7002.50005/31/2017 241,521.00 2.465 2.500245,000.00 Knox TVA Empl Credit Union2140 NCD 248,000.00499724AF9 10/31/2023 4873.35010/24/2019 249,098.64 2.210 2.241251,504.81 Lakeside Bank1686 NCD 245,000.0051210SLR6 09/18/2023 4441.80009/16/2016 241,636.15 1.775 1.800245,000.00 Legacy Bank & Trust Company2469 NCD 249,000.0052470QAN4 12/21/2028 2,3650.85012/30/2020 210,527.01 0.889 0.901248,191.37 Live Oak Banking Company2599 NCD 249,000.00538036SS4 10/18/2027 1,9351.10010/18/2021 220,524.36 1.135 1.151248,340.28 Bank Leumi USA NY2335 NCD 249,000.00063248KR8 03/31/2023 2731.45003/31/2020 247,177.32249,000.00 Malaga Bank FSB2402 NCD 249,000.0056102AAQ9 06/30/2025 1,0950.40008/31/2020 227,705.52 0.394 0.400249,000.00 Meritrust Federal Credit Union2672 NCD 249,000.0059001PAP4 03/10/2026 1,3480.55003/07/2022 227,685.60 1.904 1.930236,791.35 Medallion Bank - Salt Lake2010 NCD 245,000.0058404DDB4 01/03/2024 5513.30001/10/2019 245,764.40 3.254 3.299245,000.00 Merchants State Bank2059 NCD 245,000.00589227AG2 08/30/2024 7911.80008/30/2019 237,280.05 1.775 1.800245,000.00 Merrick Bank2610 NCD 249,000.0059013KPS9 05/19/2026 1,4181.10011/19/2021 228,591.96 1.152 1.168248,354.90 Minwest Bank MV2478 NCD 249,000.0060425SJQ3 01/29/2029 2,4041.00001/28/2021 212,053.38 1.024 1.039248,385.64 Maine Savings Credit Union2144 NCD 245,000.00560507AN5 11/08/2024 8611.90011/08/2019 237,042.40 1.875 1.902245,000.00 Mainstreet Bank2038 NCD 245,000.0056065GAG3 04/26/2024 6652.60004/26/2019 242,302.55 2.567 2.602245,000.00 Mountain America FD Credit Uni2202 NCD 249,000.0062384RAC0 11/08/2022 1302.30001/08/2020 249,323.70 1.928 1.955249,297.12 Morgan Stanley Bank NA1890 NCD 245,000.0061747MF63 01/11/2023 1942.65001/11/2018 245,651.70 2.613 2.650245,000.00 Morgan Stanley Bank NA1993 NCD 245,000.0061760ASZ3 12/06/2023 5233.55012/06/2018 246,695.40 3.501 3.550245,000.00 Municipal Trust and Savings1800 NCD 245,000.00625925AP7 05/02/2024 6712.35005/22/2017 241,155.95 2.317 2.349245,000.00 Nebraska State Bank & Trust1466 NCD 245,000.0063969ABL7 08/26/2022 562.25008/26/2015 245,345.45 2.220 2.251245,000.00 Numerica Credit Union1991 NCD 245,000.0067054NAN3 11/28/2023 5153.55011/28/2018 246,707.65 3.503 3.551245,000.00 South Ottumwa Savings Bank1851 NCD 245,000.00839145AA7 09/29/2022 902.05009/29/2017 245,149.45 2.022 2.051245,000.00 Ottawa Savings Bank1892 NCD 245,000.0068956HAC7 01/19/2023 2022.40001/19/2018 245,306.25 2.368 2.401245,000.00 Pacific Western Bank2420 NCD 249,000.0069506YSA8 09/30/2025 1,1870.45009/30/2020 226,639.80 0.443 0.450249,000.00 Pathfinder Bank2429 NCD 249,000.0070320KAR2 10/14/2025 1,2010.50010/13/2020 226,679.64 0.533 0.540248,672.63 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 144 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 4 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Negotiable Certificates of Deposits People's Bank2468 NCD 249,000.00710665GD6 12/31/2029 2,7400.90012/30/2020 204,832.38 0.967 0.981247,547.50 Pentagon Fed Cred Union2565 NCD 249,000.0070962LAE2 09/01/2026 1,5230.85009/01/2021 224,680.17 0.889 0.901248,480.80 Preferred Bank LA California2047 NCD 245,000.00740367HP5 08/16/2024 7772.00008/16/2019 238,399.70 1.972 2.000245,000.00 Parkside Financial Bank1833 NCD 245,000.0070147ACE2 03/15/2023 2572.10007/19/2017 244,539.40 2.072 2.101245,000.00 Pony Express Bank2488 NCD 249,000.00732770BJ0 02/25/2030 2,7961.00002/24/2021 205,778.58 1.055 1.070247,729.55 Rayond James Bank NA2188 NCD 245,000.0075472RAU5 12/30/2024 9131.85012/30/2019 236,189.80 1.824 1.850245,000.00 Sallie Mae Bank2102 NCD 245,000.007954504D4 09/18/2024 8101.90009/18/2019 237,591.20 1.873 1.900245,000.00 State Bank of India2403 NCD 249,000.00856285UJ8 09/04/2025 1,1610.50009/04/2020 227,454.03 0.493 0.500249,000.00 Stifel Bank & Trust1953 NCD 245,000.0086063QAK1 05/15/2023 3182.95005/15/2018 245,644.35 2.911 2.951245,000.00 San Francisco Credit Union2297 NCD 249,000.0079772FAF3 03/27/2025 1,0001.10003/27/2020 234,191.97 1.085 1.100249,000.00 Sunwest Bank2491 NCD 249,000.0086804DCQ9 02/17/2028 2,0570.80002/17/2021 214,916.88 0.861 0.873247,998.06 Somerset Trust Company Bank1616 NCD 245,000.00835104BL3 06/12/2023 3461.80006/10/2016 242,981.20 1.776 1.800245,000.00 Slovak Savings Bank1872 NCD 245,000.0083158TAA0 10/20/2022 1112.10010/20/2017 245,171.50 2.072 2.101245,000.00 Southwest Financial Fed. Credi2333 NCD 249,000.0084485EAG2 03/28/2024 6361.15003/31/2020 240,399.54 1.134 1.150249,000.00 Synchrony Bank2563 NCD 249,000.0087165FZN7 08/20/2026 1,5110.90008/20/2021 225,494.40 0.887 0.900249,000.00 Texas Bank Henderson2464 NCD 249,000.00882214AA7 12/23/2025 1,2710.45012/23/2020 224,914.23 0.483 0.490248,653.36 Third Federal Savings and Loan2157 NCD 245,000.0088413QCK2 11/25/2024 8781.95011/25/2019 237,167.35 1.923 1.950245,000.00 Crossfirst Bank of Leawood1804 NCD 245,000.0022766ABF1 06/09/2023 3432.15006/09/2017 243,601.05 2.121 2.151245,000.00 Toyota Financial Savings Bank2551 NCD 249,000.0089235MLC3 07/15/2026 1,4750.95007/15/2021 226,582.53 0.936 0.950249,000.00 Uinta Bank1639 NCD 245,000.00903572BC8 12/26/2023 5431.70006/24/2016 240,974.65 1.676 1.700245,000.00 Greenstate Credit Union2552 NCD 249,000.0039573LBM9 07/21/2026 1,4810.95007/21/2021 226,336.02 0.937 0.950249,000.00 USAlliance Federal Credit Unio2325 NCD 249,000.0090352RAU9 03/31/2025 1,0041.15003/31/2020 234,777.12 1.155 1.171248,863.09 USF Federal Credit Union2546 NCD 249,000.0090353EAR4 07/15/2031 3,3011.75007/15/2021 209,486.19 1.801 1.826247,424.52 Vystar Credit Union2136 NCD 245,000.0092891CCE0 12/11/2023 5283.65010/18/2019 247,043.30 2.170 2.200249,909.70 Washington Federal2049 NCD 245,000.00938828BJ8 08/23/2024 7842.05008/23/2019 238,585.90 2.024 2.052245,000.00 Western State Bank2342 NCD 248,000.0095960NKE6 11/13/2025 1,2311.05005/13/2020 229,700.08 1.035 1.050248,000.00 Wyoming Bank & Trust2446 NCD 249,000.0098321PAJ9 11/28/2025 1,2460.50011/27/2020 225,947.58 0.515 0.522248,745.28 Woodford State Bank1459 NCD 245,000.00979424AA6 07/29/2022 282.35008/12/2015 245,186.20 2.317 2.349245,000.00 Subtotal and Average 29,081,295.56 29,104,000.00 27,609,197.84 1.600 1.622 975 Corporate Medium Term Bonds Apple, Inc.2053 MTN 1,500,000.00037833CU2 05/11/2024 6802.85008/06/2019 1,489,170.00 1.998 2.0251,521,096.21 Apple, Inc.2082 MTN 550,000.00037833AK6 05/03/2023 3062.40008/29/2019 546,821.00 1.726 1.750552,890.44 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 145 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 5 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Corporate Medium Term Bonds Apple, Inc.2401 MTN 1,500,000.00037833DF4 01/13/2025 9272.75008/28/2020 1,481,265.00 0.620 0.6281,579,383.95 Apple, Inc.2489 MTN 700,000.00037833EB2 02/08/2026 1,3180.70002/08/2021 637,308.00 0.684 0.694700,145.06 Apple, Inc.2667 MTN 750,000.00037833CJ7 02/09/2027 1,6843.35002/23/2022 745,162.50 2.115 2.145787,413.12 Alphabet (Google) Inc.2507 MTN 200,000.0002079KAH0 08/15/2025 1,1410.45003/01/2021 183,818.00 0.668 0.678198,599.85 Alphabet (Google) Inc.2675 MTN 1,000,000.0002079KAC1 08/15/2026 1,5061.99803/14/2022 946,870.00 2.197 2.228991,008.32 Johnson & Johnson2466 MTN 2,000,000.00478160CN2 09/01/2025 1,1580.55012/23/2020 1,844,600.00 0.479 0.4862,003,993.58 Johnson & Johnson2508 MTN 2,000,000.00478160BY9 03/01/2026 1,3392.45003/01/2021 1,945,220.00 0.812 0.8232,110,903.32 Johnson & Johnson2509 MTN 1,000,000.00478160BY9 03/01/2026 1,3392.45003/01/2021 972,610.00 0.812 0.8241,055,437.44 Microsoft Corporation2212 MTN 1,800,000.00594918BX1 02/06/2024 5852.87501/22/2020 1,794,132.00 1.727 1.7511,829,825.65 Microsoft Corporation2450 MTN 2,920,000.00594918BJ2 11/03/2025 1,2213.12511/18/2020 2,917,693.20 0.572 0.5803,152,101.69 Microsoft Corporation2506 MTN 180,000.00594918BJ2 11/03/2025 1,2213.12503/01/2021 179,857.80 0.753 0.763193,183.22 Stanford University2046 MTN 2,000,000.00525555AB4 02/01/2024 5806.87505/14/2019 2,111,820.00 2.367 2.4002,091,131.76 Stanford University2182 MTN 1,000,000.00525555AB4 02/01/2024 5806.87512/12/2019 1,055,910.00 1.934 1.9601,074,371.79 Stanford University2648 MTN 1,500,000.0085440KAC8 06/01/2027 1,7961.28901/07/2022 1,346,205.00 1.479 1.5001,485,100.61 Stanford University2658 MTN 500,000.0085440KAC8 06/01/2027 1,7961.28902/01/2022 448,735.00 1.849 1.875486,348.70 Yale University2376 MTN 2,000,000.0098459LAA1 04/15/2025 1,0190.87307/01/2020 1,877,880.00 0.616 0.6252,013,347.84 Yale University2511 MTN 3,000,000.0098459LAA1 04/15/2025 1,0190.87303/01/2021 2,816,820.00 0.638 0.6463,018,266.85 Subtotal and Average 26,844,549.40 26,100,000.00 25,341,897.50 1.168 1.185 1,074 Federal Agency Bonds Federal Agricultural Mortgage1130 1,500,000.0031315PPX1 07/05/2022 42.20012/13/2012 1,500,090.00 1.930 1.9571,500,036.76 Federal Agricultural Mortgage1134 750,000.0031315PB32 11/21/2022 1432.00012/19/2012 749,632.50 2.081 2.110749,711.63 Federal Agricultural Mortgage1137 1,500,000.0031315PUE7 12/27/2022 1792.18001/04/2013 1,498,935.00 2.165 2.1961,499,894.86 Federal Agricultural Mortgage1141 1,500,000.0031315PUE7 12/27/2022 1792.18001/08/2013 1,498,935.00 2.195 2.2251,499,701.35 Federal Agricultural Mortgage1144 1,500,000.0031315PUE7 12/27/2022 1792.18001/23/2013 1,498,935.00 2.111 2.1411,500,255.58 Federal Agricultural Mortgage1147 2,595,000.0031315PUE7 12/27/2022 1792.18001/28/2013 2,593,157.55 2.199 2.2292,594,433.10 Federal Agricultural Mortgage1279 1,250,000.0031315PPX1 07/05/2022 42.20004/23/2014 1,250,075.00 2.889 2.9301,249,910.42 Federal Agricultural Mortgage1428 404,000.0031315PL23 03/27/2024 6353.33001/09/2015 406,286.64 2.540 2.575408,687.64 Federal Agricultural Mortgage1433 1,604,000.0031315PD89 06/12/2023 3462.61001/22/2015 1,598,706.80 2.269 2.3011,608,244.95 Federal Agricultural Mortgage1447 1,450,000.0031315PD89 06/12/2023 3462.61002/09/2015 1,445,215.00 2.377 2.4101,452,471.43 Federal Agricultural Mortgage1576 1,000,000.0031315PZS1 01/24/2023 2072.13004/06/2016 998,070.00 1.839 1.8641,001,396.37 Federal Agricultural Mortgage1580 474,000.0031315PEM7 08/04/2025 1,1304.35004/08/2016 491,509.56 2.296 2.328500,492.86 Federal Agricultural Mortgage1595 1,500,000.0031315P2J7 05/01/2024 6703.30004/21/2016 1,508,955.00 2.084 2.1121,529,878.13 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 146 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 6 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Agricultural Mortgage1604 1,500,000.0031315P2J7 05/01/2024 6703.30004/26/2016 1,508,955.00 2.159 2.1891,527,857.26 Federal Agricultural Mortgage1617 500,000.0031315PUE7 12/27/2022 1792.18005/26/2016 499,645.00 1.844 1.870500,708.16 Federal Agricultural Mortgage1665 2,000,000.003132X0BH3 07/15/2022 142.38007/25/2016 2,000,560.00 1.499 1.5202,000,636.97 Federal Agricultural Mortgage1710 1,500,000.0031315PRA9 02/03/2026 1,3134.81010/18/2016 1,589,160.00 2.131 2.1601,628,562.69 Federal Agricultural Mortgage1817 1,000,000.0031315PPX1 07/05/2022 42.20006/14/2017 1,000,060.00 1.908 1.9341,000,027.94 Federal Agricultural Mortgage1867 1,000,000.003132X0WL1 08/23/2024 7842.25010/06/2017 984,590.00 2.332 2.365997,731.06 Federal Agricultural Mortgage1877 1,500,000.003132X0ZZ7 12/12/2022 1642.26012/12/2017 1,497,285.00 2.229 2.2601,500,000.00 Federal Agricultural Mortgage1893 1,000,000.003130H0AU7 08/01/2024 7622.62501/09/2018 992,640.00 2.546 2.5811,000,822.40 Federal Agricultural Mortgage1901 1,500,000.003130H0AU7 08/01/2024 7622.62501/11/2018 1,488,960.00 2.623 2.6601,498,998.27 Federal Agricultural Mortgage1912 2,000,000.003132X0G39 01/30/2023 2132.50001/30/2018 1,997,120.00 2.472 2.5071,999,921.04 Federal Agricultural Mortgage1915 1,500,000.003132X0G39 01/30/2023 2132.50001/30/2018 1,497,840.00 2.481 2.5151,499,870.77 Federal Agricultural Mortgage1921 2,000,000.003132X0G39 01/30/2023 2132.50001/31/2018 1,997,120.00 2.556 2.5921,999,002.84 Federal Agricultural Mortgage1924 1,100,000.0031315PZS1 01/24/2023 2072.13002/08/2018 1,097,877.00 2.578 2.6141,097,199.37 Federal Agricultural Mortgage1928 1,500,000.003132X0H87 02/22/2023 2362.60002/22/2018 1,499,880.00 2.564 2.6001,500,000.00 Federal Agricultural Mortgage1936 1,500,000.003132X0L33 02/21/2023 2352.77002/23/2018 1,501,515.00 2.732 2.7701,500,000.00 Federal Agricultural Mortgage1999 549,000.0031315P4B2 01/30/2024 5783.46012/14/2018 553,046.13 3.018 3.060552,185.58 Federal Agricultural Mortgage2034 1,000,000.0031422BEJ5 04/09/2024 6482.35004/09/2019 988,980.00 2.365 2.398999,195.41 Federal Agricultural Mortgage2035 678,000.0031315PCY3 11/20/2024 8735.25004/08/2019 712,293.24 2.420 2.454720,003.80 Federal Agricultural Mortgage2098 550,000.0031315PEM7 08/04/2025 1,1304.35009/09/2019 570,317.00 1.659 1.683592,994.25 Federal Agricultural Mortgage2301 1,569,000.0031315PB99 11/19/2027 1,9672.85003/11/2020 1,536,615.84 1.050 1.0641,713,398.04 Federal Agricultural Mortgage2340 Call 2,000,000.0031422BZS2 05/13/2030 2,8731.50005/13/2020 1,761,040.00 1.479 1.5002,000,000.00 Federal Agricultural Mortgage2366 Call 1,750,000.0031422BF54 06/24/2030 2,9151.40006/24/2020 1,526,682.50 1.380 1.4001,750,000.00 Federal Agricultural Mortgage2367 Call 2,000,000.0031422BF54 06/24/2030 2,9151.40006/24/2020 1,744,780.00 1.380 1.4002,000,000.00 Federal Agricultural Mortgage2381 Call 1,500,000.0031422BH78 07/08/2030 2,9291.40007/08/2020 1,307,505.00 1.380 1.4001,500,000.00 Federal Agricultural Mortgage2425 Call 2,000,000.0031422BX54 09/27/2030 3,0101.30010/08/2020 1,722,120.00 1.286 1.3042,000,000.00 Federal Agricultural Mortgage2435 Call 2,000,000.0031422BZ45 10/21/2030 3,0341.28010/21/2020 1,717,280.00 1.262 1.2802,000,000.00 Federal Agricultural Mortgage2439 Call 2,000,000.0031422B2E9 10/29/2030 3,0421.34010/29/2020 1,724,340.00 1.321 1.3402,000,000.00 Federal Agricultural Mortgage2449 1,500,000.0031422B3D0 11/20/2030 3,0641.15011/20/2020 1,238,910.00 1.134 1.1501,500,000.00 Federal Agricultural Mortgage2458 Call 1,500,000.0031422B4A5 12/11/2030 3,0851.30012/11/2020 1,286,265.00 1.282 1.3001,500,000.00 Federal Agricultural Mortgage2459 Call 2,000,000.0031422B3W8 12/16/2030 3,0901.45012/16/2020 1,738,720.00 1.430 1.4502,000,000.00 Federal Agricultural Mortgage2461 1,000,000.0031422B3D0 11/20/2030 3,0641.15012/09/2020 825,940.00 1.144 1.160999,156.94 Federal Agricultural Mortgage2471 1,500,000.0031422B6K1 01/15/2026 1,2940.48001/15/2021 1,370,085.00 0.493 0.5001,498,938.33 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 147 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 7 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Agricultural Mortgage2473 Call 1,500,000.0031422B6A3 01/15/2031 3,1201.29001/15/2021 1,282,200.00 1.319 1.3381,494,236.25 Federal Agricultural Mortgage2484 Call 1,000,000.0031422B7E4 01/28/2031 3,1331.32001/28/2021 856,160.00 1.301 1.3201,000,000.00 Federal Agricultural Mortgage2496 Call 1,500,000.0031422XAW2 02/25/2031 3,1611.53002/25/2021 1,302,870.00 1.509 1.5301,500,000.00 Federal Agricultural Mortgage2513 1,000,000.0031422XCB6 03/04/2031 3,1681.47003/04/2021 842,740.00 1.581 1.602989,381.80 Federal Agricultural Mortgage2519 1,500,000.0031422XDX7 03/27/2026 1,3650.83003/29/2021 1,381,080.00 0.828 0.8401,499,438.54 Federal Agricultural Mortgage2524 1,500,000.0031422XDX7 03/27/2026 1,3650.83003/31/2021 1,381,080.00 0.913 0.9261,494,716.43 Federal Agricultural Mortgage2527 Call 1,500,000.0031422XEE8 04/07/2031 3,2022.07004/07/2021 1,352,175.00 2.074 2.1031,496,280.00 Federal Agricultural Mortgage2529 2,000,000.0031422XEL2 04/13/2028 2,1131.37504/15/2021 1,797,640.00 1.311 1.3302,004,944.54 Federal Agricultural Mortgage2530 1,500,000.0031422XFJ6 04/29/2031 3,2241.66004/29/2021 1,280,415.00 1.627 1.6501,501,191.75 Federal Agricultural Mortgage2533 1,500,000.0031422XDX7 03/27/2026 1,3650.83005/20/2021 1,381,080.00 0.864 0.8761,497,477.12 Federal Agricultural Mortgage2540 255,000.0031422XDX7 03/27/2026 1,3650.83006/08/2021 234,783.60 0.820 0.831254,983.72 Federal Agricultural Mortgage2593 1,000,000.0031422XNM0 10/05/2026 1,5571.05010/05/2021 918,050.00 1.035 1.0501,000,000.00 Federal Agricultural Mortgage2621 1,000,000.0031422XPS5 11/17/2026 1,6001.15011/17/2021 919,050.00 1.272 1.290994,063.73 Federal Agricultural Mortgage2625 1,000,000.0031422XQM7 12/01/2026 1,6141.32012/01/2021 925,030.00 1.301 1.3201,000,000.00 Federal Agricultural Mortgage2634 1,500,000.0031422XRK0 01/04/2027 1,6481.32001/04/2022 1,384,335.00 1.301 1.3201,500,000.00 Federal Agricultural Mortgage2640 Call 1,500,000.0031422XRY0 12/29/2031 3,4682.15012/29/2021 1,347,150.00 2.120 2.1501,500,000.00 Federal Farm Credit Bank .1241 500,000.003133ECRH9 06/06/2023 3402.45001/09/2014 498,550.00 3.383 3.430496,129.75 Federal Farm Credit Bank .1526 625,000.003133EAA65 07/26/2023 3902.12501/27/2016 619,712.50 2.024 2.052625,449.33 Federal Farm Credit Bank .1615 1,000,000.003133EC7D0 12/13/2024 8962.12505/13/2016 979,250.00 1.930 1.9561,003,773.48 Federal Farm Credit Bank .1787 900,000.003133EEVD9 03/25/2024 6332.30005/04/2017 891,873.00 2.274 2.306899,907.19 Federal Farm Credit Bank .1822 500,000.003133EDWX6 10/07/2024 8292.91006/21/2017 499,390.00 2.143 2.172507,683.02 Federal Farm Credit Bank .1843 445,000.003133ED6R8 11/07/2022 1292.93009/14/2017 446,504.10 1.870 1.896446,525.66 Federal Farm Credit Bank .1932 1,500,000.003133EJDE6 02/16/2023 2302.57002/16/2018 1,498,740.00 2.605 2.6421,499,371.56 Federal Farm Credit Bank .2016 500,000.003133EEG79 09/07/2023 4332.15001/15/2019 495,550.00 2.656 2.693496,993.16 Federal Farm Credit Bank .2017 650,000.003133EC2C7 11/09/2023 4962.13001/15/2019 641,699.50 2.662 2.699645,320.84 Federal Farm Credit Bank .2314 1,000,000.003133EAG44 08/03/2026 1,4942.63003/13/2020 981,020.00 1.089 1.1041,060,057.60 Federal Farm Credit Bank .2371 Call 1,500,000.003133ELQ31 07/01/2030 2,9221.33007/01/2020 1,267,830.00 1.311 1.3301,500,000.00 Federal Farm Credit Bank .2372 Call 1,500,000.003133ELQ31 07/01/2030 2,9221.33007/01/2020 1,267,830.00 1.311 1.3301,500,000.00 Federal Farm Credit Bank .2391 Call 1,500,000.003133EL3H5 08/12/2025 1,1380.57008/12/2020 1,383,795.00 0.587 0.5951,498,832.29 Federal Farm Credit Bank .2406 Call 1,500,000.003133EL4W1 08/25/2025 1,1510.61009/03/2020 1,385,145.00 0.611 0.6201,499,525.39 Federal Farm Credit Bank .2408 Call 1,500,000.003133EL4W1 08/25/2025 1,1510.61009/10/2020 1,385,145.00 0.611 0.6201,499,523.53 Federal Farm Credit Bank .2416 Call 1,500,000.003133EL7K4 09/16/2025 1,1730.55009/22/2020 1,385,670.00 0.542 0.5491,500,000.00 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 148 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 8 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Farm Credit Bank .2417 Call 1,500,000.003133EMBH4 09/29/2025 1,1860.53009/29/2020 1,378,230.00 0.522 0.5301,500,000.00 Federal Farm Credit Bank .2423 Call 1,500,000.003133EMBJ0 09/29/2025 1,1860.53009/29/2020 1,362,750.00 0.537 0.5451,499,270.00 Federal Farm Credit Bank .2427 Call 2,000,000.003133EMAZ5 06/24/2030 2,9151.25010/01/2020 1,675,000.00 1.246 1.2631,997,949.61 Federal Farm Credit Bank .2442 Call 1,500,000.003133EMFG2 11/04/2030 3,0481.37011/04/2020 1,244,325.00 1.351 1.3701,500,000.00 Federal Farm Credit Bank .2443 Call 1,500,000.003133EMFG2 11/04/2030 3,0481.37011/04/2020 1,244,325.00 1.351 1.3701,500,000.00 Federal Farm Credit Bank .2472 Call 1,500,000.003133EMNB4 01/14/2031 3,1191.38001/14/2021 1,293,270.00 1.361 1.3801,500,000.00 Federal Farm Credit Bank .2525 Call 1,500,000.003133EMRE4 02/18/2031 3,1541.42004/01/2021 1,281,105.00 1.834 1.8591,448,180.27 Federal Farm Credit Bank .2538 Call 1,000,000.003133EMUG5 03/24/2031 3,1881.98005/27/2021 870,980.00 1.887 1.9131,005,233.89 Federal Home Loan Bank1699 500,000.003133827E7 02/06/2023 2202.13010/05/2016 498,550.00 1.578 1.600501,498.68 Federal Home Loan Bank1886 1,000,000.003130A3VC5 12/08/2023 5252.25001/03/2018 988,280.00 2.359 2.392998,101.51 Federal Home Loan Bank1896 1,000,000.003130A3DL5 09/08/2023 4342.37501/09/2018 993,860.00 2.376 2.409999,621.48 Federal Home Loan Bank1903 500,000.003130ADEV0 01/17/2023 2002.38001/18/2018 499,690.00 2.385 2.418499,901.95 Federal Home Loan Bank2347 Call 1,500,000.003130AJMF3 11/28/2028 2,3421.32005/28/2020 1,307,280.00 1.301 1.3201,500,000.00 Federal Home Loan Bank2358 Call 1,000,000.003130AJP78 06/11/2029 2,5371.40006/11/2020 858,550.00 1.380 1.4001,000,000.00 Federal Home Loan Bank2361 Call 1,000,000.003130AJP78 06/11/2029 2,5371.40006/11/2020 858,550.00 1.427 1.447996,913.58 Federal Home Loan Bank2368 Call 900,000.003130AJR76 06/29/2029 2,5551.25006/29/2020 764,208.00 1.232 1.250900,000.00 Federal Home Loan Bank2369 Call 1,500,000.003130AJRG6 06/24/2030 2,9151.36006/24/2020 1,312,650.00 1.341 1.3601,500,000.00 Federal Home Loan Bank2375 Call 1,500,000.003130AJSR1 07/09/2030 2,9301.39007/09/2020 1,280,220.00 1.370 1.3901,500,000.00 Federal Home Loan Bank2377 Call 1,500,000.003130AJSR1 07/09/2030 2,9301.39007/09/2020 1,280,220.00 1.370 1.3901,500,000.00 Federal Home Loan Bank2384 Call 1,500,000.003130AJSR1 07/09/2030 2,9301.39007/09/2020 1,280,220.00 1.382 1.4011,498,676.33 Federal Home Loan Bank2395 Call 1,500,000.003130AJZ36 08/27/2025 1,1530.60008/27/2020 1,381,815.00 0.611 0.6201,499,053.33 Federal Home Loan Bank2399 Call 1,500,000.003130AJZ36 08/27/2025 1,1530.60008/27/2020 1,381,815.00 0.611 0.6201,499,053.33 Federal Home Loan Bank2405 Call 1,500,000.003130AK3Z7 09/29/2025 1,1860.57009/29/2020 1,392,165.00 0.582 0.5901,499,026.67 Federal Home Loan Bank2411 Call 1,180,000.003130AJZ36 08/27/2025 1,1530.60009/16/2020 1,087,027.80 0.591 0.5991,180,000.00 Federal Home Loan Bank2419 Call 1,500,000.003130AKAZ91 09/29/2025 1,1860.52009/29/2020 1,389,900.00 0.512 0.5201,500,000.00 Federal Home Loan Bank2445 Call 1,200,000.003130AJQS1 06/25/2030 2,9161.35011/04/2020 1,003,104.00 1.334 1.3531,199,682.05 Federal Home Loan Bank2475 Call 1,500,000.003130AKQN9 01/09/2031 3,1141.40001/28/2021 1,293,480.00 1.380 1.4001,500,000.00 Federal Home Loan Bank2476 Call 1,500,000.003130AKQV1 01/28/2031 3,1331.40001/28/2021 1,292,070.00 1.380 1.4001,500,000.00 Federal Home Loan Bank2485 Call 1,500,000.003130AKVH6 02/10/2031 3,1461.35002/10/2021 1,254,450.00 1.331 1.3501,500,000.00 Federal Home Loan Bank2490 Call 2,000,000.003130AKYB6 02/18/2031 3,1541.40002/18/2021 1,720,600.00 1.380 1.4002,000,000.00 Federal Home Loan Bank2494 Call 1,500,000.003130AL2J2 02/26/2031 3,1621.50002/26/2021 1,299,840.00 1.479 1.5001,500,000.00 Federal Home Loan Bank2500 Call 1,500,000.003130ALF66 02/25/2031 3,1611.62502/25/2021 1,317,150.00 1.602 1.6251,500,000.00 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 149 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 9 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Federal Home Loan Bank2520 Call 1,925,000.003130ALF33 03/16/2026 1,3540.75003/25/2021 1,775,273.50 0.853 0.8651,916,964.66 Federal Home Loan Bank2607 Call 1,000,000.003130APPJ8 11/04/2031 3,4132.00011/04/2021 901,150.00 1.972 2.0001,000,000.00 Federal Home Loan Bank2613 Call 1,000,000.003130APV77 12/10/2026 1,6231.50012/10/2021 942,190.00 1.479 1.5001,000,000.00 Federal Home Loan Bank2616 Call 1,000,000.003130APW84 12/03/2026 1,6161.50012/03/2021 942,790.00 1.479 1.5001,000,000.00 Federal Home Loan Bank2618 Call 1,000,000.003130APXD2 12/17/2026 1,6301.55012/17/2021 943,920.00 1.528 1.5501,000,000.00 Federal Home Loan Bank2619 Call 1,000,000.003130APWY7 12/07/2026 1,6201.35012/07/2021 937,190.00 1.331 1.3501,000,000.00 Federal Home Loan Bank2620 Call 1,000,000.003130APXT7 12/17/2026 1,6301.60012/17/2021 939,690.00 1.578 1.6001,000,000.00 Federal Home Loan Bank2659 Call 1,000,000.003130AQSM6 02/25/2027 1,7002.05002/25/2022 957,900.00 2.021 2.0501,000,000.00 Federal Home Loan Bank2662 Call 1,000,000.003130AQX65 03/04/2027 1,7072.25003/04/2022 964,070.00 2.219 2.2501,000,000.00 Federal Home Loan Bank2663 Call 1,000,000.003130AQYA5 02/24/2027 1,6992.25002/28/2022 962,350.00 2.219 2.2501,000,000.00 Federal Home Loan Bank2664 Call 1,500,000.003130AQYG2 02/25/2027 1,7002.50002/28/2022 1,457,100.00 2.470 2.5041,500,000.00 Federal Home Loan Bank2665 Call 1,000,000.003130AQZD8 02/25/2027 1,7002.62502/25/2022 972,110.00 2.589 2.6251,000,000.00 Fed. Home Loan Mortgage Corp.2345 Call 455,000.003134GVUA4 05/18/2028 2,1481.20005/18/2020 410,314.45 1.183 1.200455,000.00 Fed. Home Loan Mortgage Corp.2370 Call 1,500,000.003134GV3B2 06/28/2030 2,9191.40006/30/2020 1,267,515.00 1.380 1.4001,500,000.00 Fed. Home Loan Mortgage Corp.2373 Call 1,500,000.003134GV3U0 06/29/2029 2,5551.25006/29/2020 1,300,080.00 1.232 1.2501,500,000.00 Fed. Home Loan Mortgage Corp.2379 Call 1,500,000.003134GV4E5 12/29/2028 2,3731.20007/01/2020 1,332,585.00 1.183 1.1991,500,000.00 Fed. Home Loan Mortgage Corp.2380 Call 1,500,000.003134GV5D6 01/08/2029 2,3831.20007/08/2020 1,319,445.00 1.183 1.2001,500,000.00 Fed. Home Loan Mortgage Corp.2382 Call 1,500,000.003134GV5A2 07/15/2030 2,9361.37507/15/2020 1,263,255.00 1.356 1.3751,500,000.00 Fed. Home Loan Mortgage Corp.2386 Call 1,500,000.003134GV7L6 07/29/2030 2,9501.35007/29/2020 1,260,510.00 1.331 1.3501,500,000.00 Fed. Home Loan Mortgage Corp.2387 Call 1,500,000.003134GV7L6 07/29/2030 2,9501.35007/29/2020 1,260,510.00 1.331 1.3501,500,000.00 Fed. Home Loan Mortgage Corp.2396 Call 1,000,000.003134GWNC6 08/19/2025 1,1450.62508/20/2020 928,270.00 0.616 0.6251,000,000.00 Fed. Home Loan Mortgage Corp.2400 Call 1,500,000.003134GWC53 09/15/2025 1,1720.65009/15/2020 1,391,085.00 0.641 0.6501,500,000.00 Fed. Home Loan Mortgage Corp.2404 Call 1,447,000.003134GWA55 09/09/2025 1,1660.65009/09/2020 1,342,454.25 0.641 0.6501,447,000.00 Fed. Home Loan Mortgage Corp.2407 Call 1,500,000.003134GWD52 09/02/2025 1,1590.68009/04/2020 1,393,530.00 0.670 0.6791,500,000.00 Fed. Home Loan Mortgage Corp.2409 Call 1,500,000.003134GWP75 09/23/2025 1,1800.62509/23/2020 1,383,285.00 0.616 0.6251,500,000.00 Fed. Home Loan Mortgage Corp.2410 Call 1,000,000.003134GWP75 09/23/2025 1,1800.62509/23/2020 922,190.00 0.616 0.6251,000,000.00 Fed. Home Loan Mortgage Corp.2418 Call 1,500,000.003134GWVV5 10/15/2025 1,2020.50010/15/2020 1,372,470.00 0.493 0.5001,500,000.00 Fed. Home Loan Mortgage Corp.2421 Call 2,000,000.003134GWW93 09/30/2025 1,1870.55009/30/2020 1,837,860.00 0.542 0.5502,000,000.00 Fed. Home Loan Mortgage Corp.2422 Call 1,500,000.003134GWW93 09/30/2025 1,1870.55009/30/2020 1,378,395.00 0.542 0.5501,500,000.00 Fed. Home Loan Mortgage Corp.2424 Call 1,500,000.003134GWXK7 09/30/2025 1,1870.55009/30/2020 1,379,115.00 0.542 0.5501,500,000.00 Fed. Home Loan Mortgage Corp.2426 Call 1,500,000.003134GWXX9 10/15/2025 1,2020.55010/15/2020 1,377,030.00 0.542 0.5501,500,000.00 Fed. Home Loan Mortgage Corp.2428 Call 1,500,000.003134GWY26 10/08/2025 1,1950.57010/08/2020 1,378,725.00 0.562 0.5701,500,000.00 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 150 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 10 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Federal Agency Bonds Fed. Home Loan Mortgage Corp.2430 Call 1,500,000.003134GWYZ3 10/28/2025 1,2150.53010/28/2020 1,374,585.00 0.522 0.5301,500,000.00 Fed. Home Loan Mortgage Corp.2431 Call 1,500,000.003134GWZ33 10/22/2030 3,0351.25010/22/2020 1,245,510.00 1.232 1.2501,500,000.00 Fed. Home Loan Mortgage Corp.2432 Call 1,500,000.003134GWZL3 10/29/2025 1,2160.57010/29/2020 1,376,655.00 0.562 0.5701,500,000.00 Fed. Home Loan Mortgage Corp.2433 Call 2,000,000.003134GW3T1 10/28/2030 3,0411.40010/28/2020 1,680,340.00 1.380 1.4002,000,000.00 Fed. Home Loan Mortgage Corp.2434 Call 1,500,000.003134GW3H7 10/29/2025 1,2160.61010/29/2020 1,378,680.00 0.601 0.6101,500,000.00 Fed. Home Loan Mortgage Corp.2436 Call 2,000,000.003134GWZZ2 10/28/2030 3,0411.30010/28/2020 1,666,040.00 1.282 1.3002,000,000.00 Fed. Home Loan Mortgage Corp.2437 Call 750,000.003134GW3Z7 10/28/2025 1,2150.60010/28/2020 692,250.00 0.591 0.600750,000.00 Fed. Home Loan Mortgage Corp.2438 Call 1,500,000.003134GW3X2 10/27/2025 1,2140.62510/27/2020 1,379,145.00 0.616 0.6251,500,000.00 Fed. Home Loan Mortgage Corp.2440 Call 1,500,000.003134GW6N1 11/05/2030 3,0491.40011/05/2020 1,259,235.00 1.380 1.4001,500,000.00 Fed. Home Loan Mortgage Corp.2444 Call 1,500,000.003134GW6N1 11/05/2030 3,0491.40011/05/2020 1,259,235.00 1.380 1.4001,500,000.00 Federal National Mortgage Asso1715 500,000.0031364CCC0 04/30/2026 1,3997.12511/10/2016 571,980.00 2.367 2.400580,515.84 Federal National Mortgage Asso1883 500,000.003136G05L1 08/26/2022 562.00012/29/2017 500,280.00 2.238 2.270499,805.12 Federal National Mortgage Asso1894 1,000,000.003135G0T78 10/05/2022 962.00001/09/2018 999,530.00 2.288 2.320999,212.08 Federal National Mortgage Asso1904 1,000,000.003135G0T78 10/05/2022 962.00001/19/2018 999,530.00 2.409 2.443998,912.80 Federal National Mortgage Asso1926 1,500,000.003135G0T94 01/19/2023 2022.37502/08/2018 1,499,115.00 2.574 2.6101,498,191.52 Federal National Mortgage Asso2392 Call 1,000,000.003136G4R62 08/28/2025 1,1540.62508/28/2020 926,850.00 0.616 0.6251,000,000.00 Federal National Mortgage Asso2393 Call 1,000,000.003136G4S87 08/27/2025 1,1530.65008/27/2020 927,750.00 0.641 0.6501,000,000.00 Federal National Mortgage Asso2394 Call 1,500,000.003136G4Q97 08/27/2025 1,1530.65008/27/2020 1,391,505.00 0.641 0.6501,500,000.00 Federal National Mortgage Asso2397 Call 1,500,000.003136G4V59 08/27/2025 1,1530.62508/27/2020 1,390,380.00 0.616 0.6251,500,000.00 Federal National Mortgage Asso2412 Call 1,500,000.003136G44G5 09/22/2025 1,1790.51509/22/2020 1,382,910.00 0.507 0.5151,500,000.00 Federal National Mortgage Asso2413 Call 1,500,000.003136G43L5 09/30/2025 1,1870.55009/30/2020 1,383,810.00 0.542 0.5501,500,000.00 Federal National Mortgage Asso2415 Call 1,500,000.003136G44L4 09/25/2025 1,1820.60009/25/2020 1,386,525.00 0.591 0.6001,500,000.00 Federal National Mortgage Asso2460 2,000,000.003135G05Q2 08/05/2030 2,9570.87512/07/2020 1,654,700.00 1.139 1.1551,957,220.00 Federal National Mortgage Asso2463 Call 1,500,000.003135GAAS0 12/23/2030 3,0971.40012/23/2020 1,289,715.00 1.380 1.4001,500,000.00 Federal National Mortgage Asso2467 Call 1,000,000.003135G06Q1 12/30/2025 1,2780.64012/30/2020 912,810.00 0.597 0.6051,001,182.06 Tennessee Valley Authority1133 1,010,000.00880591EN8 08/15/2022 451.87512/14/2012 1,009,808.10 1.893 1.9201,009,949.38 Tennessee Valley Authority1508 1,000,000.00880591CJ9 11/01/2025 1,2196.75011/20/2015 1,114,490.00 2.807 2.8461,112,617.70 Tennessee Valley Authority1519 750,000.00880591ER9 09/15/2024 8072.87501/15/2016 746,632.50 2.564 2.600754,044.44 Tennessee Valley Authority1589 775,000.00880591CJ9 11/01/2025 1,2196.75004/18/2016 863,729.75 2.337 2.370875,739.62 Tennessee Valley Authority1703 1,490,000.00880591EN8 08/15/2022 451.87510/07/2016 1,489,716.90 1.538 1.5601,490,545.81 Tennessee Valley Authority1714 1,250,000.00880591CJ9 11/01/2025 1,2196.75011/10/2016 1,393,112.50 2.317 2.3501,414,419.68 Subtotal and Average 226,561,616.27 225,730,000.00 208,156,764.21 1.451 1.471 1,704 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 151 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 11 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Treasury Securities (Notes) U.S. Treasury1866 TB 1,500,000.00912828L57 09/30/2022 911.75010/06/2017 1,499,760.00 1.914 1.9411,499,322.53 U.S. Treasury1898 TB 1,500,000.00912828P38 01/31/2023 2141.75001/11/2018 1,492,800.00 2.308 2.3401,495,134.57 U.S. Treasury1905 TB 1,500,000.00912828N30 12/31/2022 1832.12501/22/2018 1,496,835.00 2.387 2.4201,500,011.37 U.S. Treasury1923 TB 1,500,000.00912828P38 01/31/2023 2141.75002/05/2018 1,492,800.00 2.560 2.5961,493,066.86 U.S. Treasury1925 TB 1,000,000.00912828P38 01/31/2023 2141.75002/08/2018 995,200.00 2.487 2.521995,774.33 U.S. Treasury1929 TB 1,000,000.00912828P79 02/28/2023 2421.50002/09/2018 991,720.00 2.534 2.570993,389.14 U.S. Treasury1934 TB 1,000,000.00912828P79 02/28/2023 2421.50002/15/2018 991,720.00 2.601 2.638992,980.68 U.S. Treasury2505 TB 1,500,000.0091282CBC4 12/31/2025 1,2790.37502/26/2021 1,367,055.00 0.731 0.7421,481,101.31 U.S. Treasury2516 TB 1,500,000.0091282CBQ3 02/28/2026 1,3380.50003/09/2021 1,367,175.00 0.819 0.8311,482,205.41 U.S. Treasury2587 TB 1,500,000.0091282CCP4 07/31/2026 1,4910.62509/24/2021 1,360,320.00 0.888 0.9011,483,492.08 Subtotal and Average 13,416,478.28 13,500,000.00 13,055,385.00 1.857 1.883 583 Municipal Bonds Acalanes Union High School Dis2334 MUN 485,000.00004284ZY4 08/01/2022 312.90003/25/2020 485,354.05 1.677 1.700485,472.96 County of Alameda2173 MUN 290,000.00010878AS5 08/01/2026 1,4924.00012/05/2019 299,378.60 2.139 2.168310,087.34 Alameda County Joint Pws Auth.2005 MUN 505,000.00010831DS1 06/01/2025 1,0663.36512/24/2018 506,434.20 3.175 3.220506,910.91 Alameda County Joint Pws Auth.2566 MUN 110,000.00010831DT9 06/01/2026 1,4313.39508/13/2021 110,165.00 0.925 0.938120,321.00 Antelope Valley Community Coll1790 MUN 220,000.0003667PFL1 08/01/2022 312.60805/09/2017 220,079.20 2.266 2.298220,052.85 Antelope Valley Community Coll2069 MUN 500,000.0003667PFN7 08/01/2024 7623.02608/16/2019 494,925.00 1.876 1.902511,117.65 Bay Area Toll Authority2558 MUN 1,750,000.00072024XC1 04/01/2026 1,3701.07907/26/2021 1,594,040.00 0.739 0.7501,771,171.36 Beverly Hills Public Fing Auth2612 MUN 350,000.00088006KA8 06/01/2026 1,4311.14711/15/2021 320,379.50 1.183 1.200349,294.14 Beverly Hills Public Fing Auth2680 MUN 490,000.00088006KB6 06/01/2027 1,7961.32704/01/2022 441,068.60 2.810 2.850456,100.69 Beverly Hills Unified Sch Dist2682 MUN 920,000.00088023PL4 08/01/2026 1,4922.70004/13/2022 894,286.00 2.644 2.681920,681.44 Burlingame School District1548 MUN 470,000.00121457EQ4 08/01/2025 1,1276.23802/24/2016 490,318.10 3.557 3.606502,101.12 Burbank Unified School Distri.2570 MUN 1,000,000.0012082SDN1 08/01/2026 1,4921.36708/30/2021 904,160.00 0.947 0.9601,016,185.77 Cabrillo Community College Dis2119 MUN 2,000,000.00127109QD1 08/01/2027 1,8572.38510/08/2019 1,883,920.00 2.342 2.3752,000,000.00 Carlsbad Unified School Dist .1857 MUN 305,000.00142665DJ4 08/01/2026 1,4925.23409/27/2017 325,605.80 2.850 2.890330,591.43 CA Infrastructure -Econ Dev Bk2666 MUN 210,000.0013034AL73 10/01/2026 1,5531.03502/16/2022 189,445.20 2.224 2.254199,714.54 CA ST Dept of WTR Resources2633 MUN 180,000.0013067WRC8 12/01/2025 1,2490.79012/13/2021 164,853.00 1.301 1.320176,834.04 CA ST Dept of WTR Resources2645 MUN 300,000.0013067WRD6 12/01/2026 1,6140.92012/23/2021 268,572.00 1.430 1.450293,244.74 Chabot-Las Positas CCD2564 MUN 285,000.0015722TJR3 08/01/2026 1,4921.08008/16/2021 256,839.15 0.897 0.910286,929.28 Chabot-Las Positas CCD2589 MUN 125,000.0015722TJQ5 08/01/2025 1,1270.88009/29/2021 115,143.75 0.897 0.910124,885.55 City of Chula Vista2653 MUN 1,000,000.0017131RAU0 06/01/2026 1,4310.84001/10/2022 896,770.00 1.676 1.700967,670.78 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 152 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 12 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds Calleguas Municipal Water Dist2544 MUN 550,000.0013124MCE3 07/01/2029 2,5571.86507/01/2021 482,779.00 1.425 1.445565,217.12 Calleguas Municipal Water Dist2646 MUN 600,000.0013124MCB9 07/01/2026 1,4611.09712/27/2021 546,132.00 1.233 1.250596,435.47 City of Corona2601 MUN 500,000.0021969AAJ1 05/01/2030 2,8612.24210/14/2021 431,290.00 2.052 2.081505,746.31 Cerritos Community College Dis1876 MUN 55,000.00156792GW7 08/01/2022 312.97111/30/2017 55,034.10 2.416 2.45055,022.41 Contra Costa Community College2103 MUN 400,000.00212204JJ1 08/01/2028 2,2232.21309/12/2019 358,428.00 2.071 2.100402,491.90 Contra Costa Community College2120 MUN 990,000.00212204JK8 08/01/2029 2,5882.26309/20/2019 871,130.70 2.505 2.539972,923.55 Contra Costa Community College2244 MUN 1,500,000.00212204JK8 08/01/2029 2,5882.26302/07/2020 1,319,895.00 2.100 2.1301,512,727.59 Contra Costa Community College2291 MUN 320,000.00212204JF9 08/01/2025 1,1271.91803/09/2020 301,936.00 1.128 1.143327,387.50 Contra Costa Community College2555 MUN 1,000,000.00212204LM1 08/01/2026 1,4921.30008/02/2021 900,260.00 0.764 0.7751,020,983.66 State of Delaware1952 MUN 1,500,000.002463807H6 07/01/2022 03.50005/03/2018 1,500,000.00 2.927 2.9671,500,000.00 Desert Community Clg Dist2611 MUN 200,000.00250375JX1 08/01/2027 1,8571.16911/12/2021 176,624.00 1.479 1.500196,784.39 Desert Sands Unif Sch District2635 MUN 880,000.00250433UA5 08/01/2026 1,4921.98212/16/2021 833,967.20 1.390 1.410899,819.66 Fremon Union High School Distr1646 MUN 525,000.00357172VA0 02/01/2026 1,3116.08006/28/2016 558,715.50 2.994 3.035575,014.12 Fremon Union High School Distr2595 MUN 235,000.00357172C52 08/01/2031 3,3182.02010/01/2021 200,708.80 1.825 1.851238,275.68 Fullerton School District1916 MUN 995,000.00359819DN6 08/01/2026 1,4923.16002/14/2018 980,721.75 3.028 3.070998,192.20 Fullerton School District1917 MUN 750,000.00359819DM8 08/01/2025 1,1273.04002/14/2018 742,050.00 2.959 3.000750,817.94 Fullerton School District2085 MUN 365,000.00359819DN6 08/01/2026 1,4923.16008/29/2019 359,762.25 1.913 1.940381,936.21 State of Georgia1613 MUN 500,000.00373384RU2 10/01/2022 923.57005/17/2016 502,410.00 1.878 1.904501,956.93 State of Georgia1645 MUN 365,000.00373384W69 02/01/2023 2153.25006/27/2016 365,810.30 1.898 1.925367,636.90 State of Georgia1666 MUN 1,825,000.003733844V5 02/01/2025 9462.37507/29/2016 1,780,798.50 1.972 1.9991,841,179.86 State of Georgia1691 MUN 385,000.00373384RU2 10/01/2022 923.57009/26/2016 386,855.70 1.630 1.653386,752.35 State of Georgia1775 MUN 250,000.00373384RX6 10/01/2025 1,1884.00004/10/2017 254,702.50 2.739 2.777258,798.97 State of Georgia1919 MUN 1,095,000.00373384RY4 10/01/2026 1,5534.31001/26/2018 1,133,029.35 2.979 3.0201,147,475.18 State of Georgia1945 MUN 200,000.00373384RY4 10/01/2026 1,5534.31003/19/2018 206,946.00 3.204 3.248207,812.82 State of Georgia1962 MUN 390,000.00373384SP2 10/01/2023 4573.74010/25/2018 393,147.30 3.093 3.136392,706.61 State of Georgia1967 MUN 350,000.00373385BU6 02/01/2027 1,6762.72010/31/2018 339,377.50 3.412 3.460339,743.06 State of Georgia1980 MUN 1,200,000.00373384PB6 11/01/2027 1,9495.01411/30/2018 1,286,556.00 3.649 3.7001,271,050.17 State of Georgia2086 MUN 1,500,000.00373384RV0 10/01/2023 4573.72008/29/2019 1,511,745.00 1.749 1.7741,535,038.55 State of Georgia2229 MUN 425,000.00373384RY4 10/01/2026 1,5534.31001/31/2020 439,760.25 1.837 1.863466,390.48 State of Georgia2332 MUN 1,000,000.00373384RW8 10/01/2024 8233.82003/23/2020 1,010,170.00 1.889 1.9151,040,881.14 City of Glendora2109 MUN 1,345,000.00378612AL9 06/01/2028 2,1622.26509/16/2019 1,236,956.15 2.318 2.3501,338,895.63 City of Glendora2137 MUN 400,000.00378612AL9 06/01/2028 2,1622.26510/02/2019 367,868.00 2.194 2.225400,852.27 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 153 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 13 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds City of Glendora2590 MUN 1,365,000.00378612AJ4 06/01/2026 1,4312.10809/29/2021 1,290,771.30 1.075 1.0901,417,910.71 State of Hawaii1685 MUN 1,045,000.00419792DA1 10/01/2026 1,5533.15010/19/2016 1,033,034.75 2.431 2.4651,071,812.65 State of Hawaii1944 MUN 1,000,000.00419792NH5 10/01/2022 921.92103/20/2018 1,000,000.00 2.584 2.620998,361.68 State of Hawaii1947 MUN 1,500,000.00419792NH5 10/01/2022 921.92103/29/2018 1,500,000.00 2.663 2.7001,497,265.88 State of Hawaii1961 MUN 250,000.00419791YS1 02/01/2025 9465.23010/25/2018 261,135.00 3.363 3.410260,496.51 State of Hawaii1981 MUN 500,000.00419791YV4 02/01/2028 2,0415.48011/30/2018 544,940.00 3.687 3.739540,808.91 State of Hawaii1995 MUN 800,000.00419791YT9 02/01/2026 1,3115.33012/06/2018 850,704.00 3.304 3.350850,081.06 State of Hawaii2019 MUN 750,000.00419792NH5 10/01/2022 921.92101/17/2019 750,000.00 2.613 2.650748,705.15 City of Huntington Beach2560 MUN 1,000,000.00446201AE5 06/15/2026 1,4451.34408/12/2021 896,690.00 0.909 0.9211,016,282.46 City of Huntington Beach2562 MUN 1,000,000.00446201AE5 06/15/2026 1,4451.34408/13/2021 896,690.00 0.927 0.9391,015,580.62 City of La Habra2660 MUN 500,000.00503433AK0 08/01/2031 3,3182.67302/07/2022 432,930.00 2.638 2.675499,904.22 Los Altos Elementary Sch Distr2681 MUN 500,000.00544290JH3 10/01/2024 8231.00003/24/2022 476,900.00 2.522 2.557483,107.88 City of Los Angeles1748 MUN 1,000,000.00544351KS7 09/01/2023 4272.64002/14/2017 995,990.00 2.784 2.8231,000,317.18 City of Los Angeles1879 MUN 1,090,000.00544351KR9 09/01/2022 622.44012/11/2017 1,090,991.90 2.355 2.3881,090,088.10 City of Los Angeles1969 MUN 295,000.00544351NP0 09/01/2026 1,5233.30011/02/2018 292,846.50 3.530 3.579292,015.99 City of Los Angeles2008 MUN 1,000,000.00544351MS5 09/01/2026 1,5233.50001/07/2019 1,000,380.00 3.077 3.1191,013,970.59 City of Los Angeles2200 MUN 840,000.00544351NQ8 09/01/2027 1,8883.40001/06/2020 831,314.40 2.360 2.393879,698.00 City of Los Angeles2213 MUN 985,000.00544351LQ0 09/01/2029 2,6193.05001/22/2020 936,400.10 2.413 2.4461,022,741.13 City of Los Angeles2283 MUN 1,000,000.00544351KV0 09/01/2026 1,5233.15003/05/2020 986,950.00 1.519 1.5411,063,563.78 Los Angeles Community College2487 MUN 1,000,000.0054438CYN6 08/01/2030 2,9531.80601/28/2021 862,490.00 1.432 1.4521,026,646.74 Los Angeles Community College2592 MUN 250,000.0054438CYL0 08/01/2026 1,4921.17409/30/2021 227,420.00 1.064 1.078250,943.55 Los Angeles Community College2614 MUN 1,500,000.0054438CYL0 08/01/2026 1,4921.17411/15/2021 1,364,520.00 1.233 1.2501,495,475.59 Los Angeles Community College2642 MUN 275,000.0054438CYL0 08/01/2026 1,4921.17412/21/2021 250,162.00 1.282 1.300273,628.96 Los Angeles Cnty Met Tran Auth2641 MUN 1,000,000.005447122K7 06/01/2025 1,0665.13012/21/2021 1,049,110.00 1.085 1.1001,115,107.66 Los Angeles Dept. of WTR & PWR1949 MUN 1,500,000.00544495VX9 07/01/2027 1,8265.51603/29/2018 1,618,365.00 3.254 3.3001,642,163.27 Los Angeles Dept. of WTR & PWR1965 MUN 425,000.00544495VX9 07/01/2027 1,8265.51610/29/2018 458,536.75 3.600 3.650458,714.40 Los Angeles Dept. of WTR & PWR1975 MUN 300,000.00544525NW4 07/01/2022 05.18111/07/2018 300,000.00 3.166 3.210300,000.00 State of Massachusetts2227 MUN 250,000.0057582PUT5 05/01/2029 2,4964.91001/30/2020 261,032.50 2.331 2.363288,869.99 State of Massachusetts2543 MUN 1,000,000.0057582PUT5 05/01/2029 2,4964.91007/01/2021 1,044,130.00 1.484 1.5051,219,053.40 State of Massachusetts2684 MUN 1,000,000.0057582PUS7 05/01/2027 1,7654.76004/05/2022 1,040,060.00 2.968 3.0101,077,871.19 State of Maryland1943 MUN 1,280,000.005741925D8 03/01/2023 2434.40003/20/2018 1,292,979.20 2.633 2.6701,293,740.34 State of Maryland1958 MUN 1,690,000.005741926L9 08/01/2024 7624.20010/19/2018 1,724,357.70 3.413 3.4611,713,403.10 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 154 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 14 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds State of Maryland2184 MUN 500,000.005741926N5 08/01/2025 1,1274.35012/16/2019 516,320.00 2.089 2.118532,258.52 State of Maryland2581 MUN 245,000.005741926N5 08/01/2025 1,1274.35009/23/2021 252,996.80 0.690 0.700272,153.85 State of Maryland - Dept/Trans2134 MUN 1,000,000.00574204WH2 06/15/2023 3494.45010/15/2019 1,012,700.00 1.893 1.9201,023,230.42 State of Michigan2002 MUN 825,000.005946108C4 05/15/2026 1,4143.85012/21/2018 825,635.25 3.452 3.500834,760.75 City of Manhattan Beach2647 MUN 650,000.00562784AM0 01/01/2032 3,4712.34101/05/2022 566,462.00 2.129 2.159659,087.35 Menlo Park City School Dist.2104 MUN 1,000,000.00586840ND8 07/01/2027 1,8262.21410/08/2019 940,770.00 2.183 2.2141,000,000.00 Marin Community College Dist.1858 MUN 500,000.0056781RGU5 08/01/2027 1,8573.27209/28/2017 492,485.00 2.791 2.830509,738.82 Marin Community College Dist.1973 MUN 120,000.0056781RGT8 08/01/2026 1,4923.17211/05/2018 118,484.40 3.452 3.500118,600.07 Marin Community College Dist.2084 MUN 250,000.0056781RJL2 08/01/2027 1,8573.33008/29/2019 246,907.50 1.874 1.900266,795.32 Marin Community College Dist.2287 MUN 310,000.0056781RJJ7 08/01/2025 1,1275.00003/06/2020 324,210.40 1.193 1.210344,961.98 Marin Community College Dist.2495 MUN 1,000,000.0056781RKH9 08/01/2030 2,9531.45102/25/2021 832,710.00 1.431 1.4511,000,000.00 Marin Community College Dist.2499 MUN 710,000.0056781RKH9 08/01/2030 2,9531.45102/25/2021 591,224.10 1.470 1.490707,870.63 Marin Community College Dist.2568 MUN 1,000,000.0056781RKU0 08/01/2026 1,4920.89309/14/2021 901,600.00 0.880 0.8931,000,000.00 Marin Community College Dist.2588 MUN 285,000.0056781RKD8 08/01/2026 1,4920.67909/29/2021 254,658.90 1.025 1.040280,911.51 Mt. San Antonio Community Coll1489 MUN 1,335,000.00623040GX4 08/01/2023 3964.10310/26/2015 1,348,363.35 2.490 2.5251,355,600.60 Mt. San Antonio Community Coll2208 MUN 230,000.00623040KQ4 08/01/2029 2,5882.56902/04/2020 211,825.40 2.533 2.569230,000.00 Mt. San Antonio Community Coll2661 MUN 785,000.00623040KX9 08/01/2030 2,9532.64902/07/2022 716,249.70 2.173 2.203810,670.89 State of Mississippi1968 MUN 1,500,000.00605581LM7 11/01/2026 1,5843.75111/07/2018 1,515,176.40 3.377 3.4241,518,392.69 State of Mississippi1972 MUN 500,000.00605581LM7 11/01/2026 1,5843.75111/07/2018 505,058.80 3.401 3.449505,655.95 State of Mississippi2087 MUN 750,000.00605581HL4 12/01/2024 8842.98708/30/2019 745,147.50 1.745 1.770770,969.02 State of Mississippi2090 MUN 500,000.00605581HL4 12/01/2024 8842.98709/04/2019 496,765.00 1.783 1.807513,531.80 State of Mississippi2096 MUN 150,000.006055805W5 11/01/2025 1,2194.68109/09/2019 156,271.50 1.888 1.914163,025.59 State of Mississippi2189 MUN 250,000.006055805V7 11/01/2024 8544.51112/19/2019 256,950.00 2.079 2.108263,253.25 State of Mississippi2329 MUN 1,000,000.00605581LJ4 11/01/2023 4883.40803/20/2020 1,005,250.00 1.626 1.6491,022,685.90 State of Mississippi2626 MUN 1,000,000.00605581QR1 10/01/2031 3,3792.11712/09/2021 859,560.00 1.992 2.0201,008,089.30 State of Mississippi2629 MUN 250,000.00605581LL9 11/01/2025 1,2193.64612/06/2021 252,382.50 1.080 1.095270,752.31 City of Napa Solid Waste2055 MUN 595,000.00630337AL7 08/01/2024 7622.20008/08/2019 580,969.90 1.968 1.996597,394.27 New York St Envrnmntl Facs2007 MUN 450,000.0064985HWS2 07/15/2024 7452.12001/04/2019 437,935.50 2.860 2.900443,430.50 New York State Urban Dev Corp.2097 MUN 700,000.006500357D4 03/15/2026 1,3533.07009/09/2019 685,832.00 2.071 2.100723,396.75 New York State Urban Dev Corp.2683 MUN 1,000,000.00650036AV8 03/15/2027 1,7181.49603/28/2022 901,500.00 2.777 2.816942,392.62 New York State Envrnmntl Corp2022 MUN 1,000,000.00649791CN8 03/01/2023 2434.69001/22/2019 1,011,160.00 2.752 2.7911,011,878.30 New York State Envrnmntl Corp2024 MUN 1,000,000.00649791CN8 03/01/2023 2434.69002/08/2019 1,011,160.00 2.751 2.7901,011,893.37 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 155 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 15 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds New York State Envrnmntl Corp2146 MUN 1,500,000.00649791PQ7 02/15/2025 9602.12010/31/2019 1,453,710.00 2.063 2.0911,501,092.66 New York State Envrnmntl Corp2224 MUN 580,000.00649791PS3 02/15/2027 1,6902.36001/30/2020 550,536.00 1.933 1.960589,967.20 New York State Envrnmntl Corp2575 MUN 1,500,000.00649791PR5 02/15/2026 1,3252.26009/13/2021 1,440,390.00 0.794 0.8051,577,502.81 New York State Envrnmntl Corp2677 MUN 1,000,000.00649791PS3 02/15/2027 1,6902.36003/16/2022 949,200.00 2.325 2.3581,000,075.25 New York State Envrnmntl Corp2678 MUN 1,000,000.00649791PS3 02/15/2027 1,6902.36003/21/2022 949,200.00 2.367 2.400998,245.44 City of Oakland2293 MUN 1,500,000.00672240WY0 01/15/2030 2,7552.11003/09/2020 1,308,495.00 1.436 1.4561,568,561.79 City of Oakland2307 MUN 1,500,000.00672240WY0 01/15/2030 2,7552.11003/13/2020 1,308,495.00 1.638 1.6611,546,652.14 City of Oakland2313 MUN 1,080,000.00672240WY0 01/15/2030 2,7552.11003/16/2020 942,116.40 2.247 2.2791,067,651.03 City of Oakland2316 MUN 1,500,000.00672240WX2 01/15/2029 2,3902.07003/16/2020 1,332,735.00 2.151 2.1811,490,003.46 City of Oakland Pension2630 MUN 450,000.00672319CF5 12/15/2025 1,2634.67612/06/2021 461,956.50 1.562 1.584496,391.93 Ohlone Community College Distr2165 MUN 600,000.00677765GY9 08/01/2027 1,8572.23711/22/2019 560,040.00 2.271 2.303598,152.16 Ohlone Community College Distr2175 MUN 280,000.00677765GY9 08/01/2027 1,8572.23712/06/2019 261,352.00 2.327 2.360278,404.21 Ohlone Community College Distr2179 MUN 970,000.00677765HA0 08/01/2029 2,5882.33712/11/2019 882,923.10 2.382 2.415965,224.08 Ohlone Community College Distr2341 MUN 1,185,000.00677765GZ6 08/01/2028 2,2232.28705/08/2020 1,091,752.35 1.849 1.8751,212,370.38 State of Ohio1688 MUN 800,000.00677522JB1 05/01/2023 3042.11009/13/2016 793,840.00 1.764 1.788802,010.05 State of Ohio1742 MUN 2,000,000.00677522JB1 05/01/2023 3042.11001/31/2017 1,984,600.00 2.485 2.5201,993,709.33 State of Ohio1832 MUN 900,000.006775207G7 04/01/2024 6404.97106/30/2017 925,101.00 2.416 2.450936,380.36 State of Ohio2308 MUN 500,000.00677521CT1 09/01/2026 1,5235.26203/13/2020 533,590.00 1.710 1.734569,226.80 Orange Cnty Water District2578 MUN 315,000.0068442CCY0 08/15/2025 1,1412.09509/16/2021 303,556.05 0.690 0.700328,509.06 Orchard School District1910 MUN 200,000.00685585FD8 08/01/2027 1,8573.12501/25/2018 196,744.00 3.208 3.253198,913.05 State of Oregon1974 MUN 500,000.0068607LXQ5 06/01/2027 1,7965.89211/06/2018 534,065.00 3.516 3.565541,839.63 State of Oregon2003 MUN 300,000.0068608USE7 08/01/2025 1,1272.87712/21/2018 300,066.00 3.156 3.200297,323.41 State of Oregon2015 MUN 445,000.0068607LXQ5 06/01/2027 1,7965.89201/16/2019 475,317.85 3.537 3.587488,214.95 State of Oregon2223 MUN 570,000.0068609TDT2 05/01/2024 6703.22701/30/2020 571,584.60 1.641 1.664585,696.71 State of Oregon2230 MUN 495,000.0068607LXQ5 06/01/2027 1,7965.89201/31/2020 528,724.35 2.583 2.619567,016.87 State of Oregon2266 MUN 1,000,000.0068607LXQ5 06/01/2027 1,7965.89202/24/2020 1,068,130.00 2.482 2.5171,150,737.45 State of Oregon2310 MUN 350,000.0068609BXT9 05/01/2027 1,7653.08003/13/2020 345,341.50 1.302 1.320378,305.04 State of Oregon2378 MUN 355,000.0068609TVS4 06/01/2030 2,8921.67207/02/2020 304,057.50 1.433 1.452360,715.01 State of Oregon2542 MUN 870,000.0068608KA24 08/01/2030 2,9535.33207/01/2021 947,551.80 1.943 1.9701,085,436.83 State of Oregon2549 MUN 1,225,000.0068609TU30 08/01/2028 2,2231.48407/08/2021 1,084,872.25 1.134 1.1501,248,831.43 State of Oregon2584 MUN 265,000.0068609TT81 08/01/2025 1,1270.80309/24/2021 246,296.30 0.690 0.700265,827.10 State of Oregon2624 MUN 250,000.0068609TZT8 08/01/2026 1,4920.98411/19/2021 228,670.00 1.292 1.310246,781.12 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 156 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 16 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds State of Oregon2627 MUN 900,000.0068609T3M8 11/01/2031 3,4102.03711/26/2021 772,308.00 2.020 2.048899,086.46 State of Oregon2679 MUN 1,000,000.0068607LXQ5 06/01/2027 1,7965.89204/01/2022 1,068,130.00 3.259 3.3041,116,030.16 City of Pacifica2138 MUN 1,015,000.0069511AAS3 06/01/2025 1,0662.56310/23/2019 990,538.50 2.469 2.5031,016,610.77 City of Pacifica2139 MUN 580,000.0069511AAT1 06/01/2026 1,4312.66310/23/2019 562,762.40 2.611 2.647580,309.51 Pasadena CA Public Finance Aut1985 MUN 665,000.00702274CP4 12/01/2023 5183.43812/06/2018 668,597.65 3.205 3.250666,621.12 Pasadena CA Public Finance Aut2573 MUN 120,000.0070227RBM1 05/01/2026 1,4001.98409/09/2021 112,796.40 0.903 0.915124,802.60 Pasadena CA Public Finance Aut2615 MUN 550,000.00702274CS8 12/01/2026 1,6143.50012/01/2021 554,757.50 1.380 1.400599,098.32 Polomar Community Clge Distri2582 MUN 1,000,000.00697511FU2 08/01/2026 1,4921.03110/13/2021 905,730.00 1.016 1.0311,000,000.00 Polomar Community Clge Distri2676 MUN 335,000.00697511FD0 08/01/2026 1,4921.19903/15/2022 305,533.40 2.288 2.320320,495.22 Redondo Beach Unified School D2388 MUN 750,000.00757710UE6 08/01/2030 2,9531.66008/06/2020 630,157.50 1.439 1.459761,316.22 State of Rhode Island2192 MUN 260,000.0076222RYN6 01/15/2025 9292.00012/20/2019 251,888.00 2.231 2.262259,717.44 State of Rhode Island2219 MUN 1,500,000.0076222RXB3 04/01/2028 2,1013.25001/27/2020 1,485,720.00 2.077 2.1061,590,133.59 State of Rhode Island2239 MUN 550,000.0076222RXB3 04/01/2028 2,1013.25002/06/2020 544,764.00 1.990 2.018585,737.65 Riverside Cmnty College Distt.2596 MUN 1,365,000.0076886PJP9 08/01/2026 1,4921.12410/04/2021 1,236,239.55 1.006 1.0201,370,637.28 Rancho Santiago Comm College D2522 MUN 450,000.00752147HH4 09/01/2024 7930.63403/29/2021 423,027.00 0.625 0.633450,000.00 Redwood City School District2130 MUN 1,000,000.00757889EH9 08/01/2027 1,8572.28410/16/2019 936,000.00 2.252 2.2841,000,000.00 Redwood City School District2253 MUN 1,095,000.00757889EG1 08/01/2026 1,4922.15902/13/2020 1,038,060.00 1.727 1.7511,112,168.22 City of Santa Ana2603 MUN 175,000.00801139AE6 08/01/2026 1,4921.17610/18/2021 155,519.00 1.223 1.240174,556.57 Santa Barbara Unified School D2385 MUN 490,000.00801315KU5 08/01/2029 2,5881.65307/21/2020 425,741.40 1.483 1.504494,801.92 San Bernardino Cmty College Di2166 MUN 1,500,000.00796720NC0 08/01/2028 2,2232.59012/12/2019 1,404,885.00 2.554 2.5901,500,000.00 San Bernardino Cmty College Di2365 MUN 2,000,000.00796720NV8 08/01/2029 2,5881.84807/07/2020 1,752,320.00 1.822 1.8482,000,000.00 County of Santa Clara1897 MUN 1,340,000.00801546PH9 08/01/2023 3962.50001/11/2018 1,334,171.00 2.436 2.4701,340,402.40 County of Santa Clara1899 MUN 1,460,000.00801546PJ5 08/01/2024 7622.68001/12/2018 1,445,531.40 2.643 2.6801,460,000.00 Santa Clarita Community Colleg2557 MUN 1,250,000.00801686TF3 08/01/2026 1,4921.14608/02/2021 1,141,575.00 0.742 0.7521,269,794.75 Santa Clara Valley Water Dist.2181 MUN 1,555,000.0080168ACV7 06/01/2028 2,1622.43412/12/2019 1,452,509.95 2.416 2.4501,553,663.84 Santa Cruz County Capital Fin.1906 MUN 465,000.0080181PCT2 06/01/2024 7012.50001/25/2018 458,764.35 2.968 3.010460,887.62 Santa Cruz County Capital Fin.1907 MUN 465,000.0080181PCU9 06/01/2025 1,0662.75001/25/2018 458,494.65 3.008 3.050461,374.11 Santa Cruz County Capital Fin.1908 MUN 470,000.0080181PCV7 06/01/2026 1,4313.00001/25/2018 462,935.90 3.107 3.150467,890.30 Santa Cruz County Capital Fin.1909 MUN 280,000.0080181PCW5 06/01/2027 1,7963.00001/25/2018 273,028.00 3.205 3.250277,286.40 Santa Cruz MET Transit Dist.2671 MUN 1,000,000.00801747AF3 08/01/2027 1,8572.47003/03/2022 938,330.00 2.030 2.0581,019,690.35 San Diego Unified Sch District2602 MUN 1,000,000.00797356DL3 07/01/2031 3,2871.98410/21/2021 853,060.00 1.824 1.8501,010,982.58 San Diego Unified Sch District2606 MUN 900,000.00797356DL3 07/01/2031 3,2871.98410/23/2021 767,754.00 2.024 2.053894,983.94 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 157 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 17 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds San Diego Unified Sch District2617 MUN 270,000.00797356DH2 07/01/2028 2,1921.59911/17/2021 239,954.40 1.712 1.736267,908.41 San Diego Community College Di2550 MUN 255,000.00797272QS3 08/01/2027 1,8572.40707/09/2021 240,230.40 1.007 1.021272,376.40 San Diego Community College Di2639 MUN 1,980,000.00797272RN3 08/01/2026 1,4921.44512/28/2021 1,829,143.80 1.193 1.2101,998,417.95 San Diego Community College Di2651 MUN 500,000.00797272RT0 08/01/2031 3,3182.11301/10/2022 424,015.00 2.120 2.150498,484.26 San Diego Regl Trans Commissio2632 MUN 200,000.00797400MR6 04/01/2026 1,3701.03612/08/2021 183,328.00 1.292 1.310198,006.32 San Diego Cnty Wtr Authority2580 MUN 875,000.00797412DN0 05/01/2026 1,4000.97109/17/2021 795,541.25 0.887 0.900877,322.12 San Diego Cnty Wtr Authority2600 MUN 210,000.00797412DM2 05/01/2025 1,0350.74310/08/2021 194,594.40 0.838 0.850209,373.93 San Diego Cnty Wtr Authority2604 MUN 250,000.00797412DN0 05/01/2026 1,4000.97110/20/2021 227,297.50 1.134 1.150248,331.05 San Diego Cnty Wtr Authority2623 MUN 750,000.00797412DN0 05/01/2026 1,4000.97111/19/2021 681,892.50 1.282 1.300740,832.30 San Dieguito Union High Sch Di2536 MUN 430,000.00797508JW9 08/01/2026 1,4921.07406/09/2021 394,004.70 1.059 1.074430,000.00 San Dieguito Union High Sch Di2537 MUN 435,000.00797508JX7 08/01/2027 1,8571.37206/09/2021 392,913.75 1.353 1.372435,000.00 San Dieguito Union High Sch Di2674 MUN 435,000.00797508HF8 08/01/2026 1,4921.86003/11/2022 411,514.35 2.070 2.099430,960.94 Sequoia Union High School Dist2320 MUN 400,000.00817409N35 07/01/2025 1,0961.73503/18/2020 380,264.00 1.381 1.400403,859.17 Sequoia Union High School Dist2531 MUN 250,000.00817409N76 07/01/2029 2,5572.10304/30/2021 222,222.50 1.658 1.681256,854.81 City & County of San Francisco1509 MUN 1,000,000.00797646NC6 06/15/2025 1,0805.45011/27/2015 1,059,850.00 3.067 3.1101,059,432.97 City & County of San Francisco1711 MUN 2,105,000.00797646T48 06/15/2025 1,0802.29011/01/2016 2,040,081.80 2.219 2.2492,107,236.83 City & County of San Francisco1712 MUN 245,000.00797646T55 06/15/2026 1,4452.39011/01/2016 235,111.80 2.376 2.410244,825.76 City & County of San Francisco1839 MUN 230,000.00797646T48 06/15/2025 1,0802.29007/14/2017 222,906.80 2.682 2.720227,384.56 City & County of San Francisco2014 MUN 1,420,000.00797646ND4 06/15/2026 1,4455.60001/16/2019 1,537,973.60 3.304 3.3501,531,059.09 City & County of San Francisco2148 MUN 1,120,000.007976466C5 06/15/2029 2,5412.10010/31/2019 1,020,331.20 2.337 2.3691,101,273.78 San Francisco Cmnty Facs Dist1937 MUN 680,000.0079772EBC2 09/01/2027 1,8883.25003/02/2018 655,479.20 3.451 3.499672,600.35 San Francisco Cmnty Facs Dist2132 MUN 350,000.0079772ECL1 09/01/2029 2,6193.64810/11/2019 337,421.00 2.398 2.431376,966.71 San Francisco Cmnty Facs Dist2309 MUN 130,000.0079772ECJ6 09/01/2027 1,8883.46803/13/2020 126,089.60 1.577 1.599141,783.46 San Francisco Cmnty Facs Dist2571 MUN 300,000.0079772ECF4 09/01/2024 7933.10808/30/2021 295,752.00 0.741 0.752315,140.67 San Francisco Cmnty Facs Dist2608 MUN 575,000.0079772EDY2 09/01/2031 3,3492.59111/03/2021 498,979.25 2.305 2.337586,895.30 San Francisco Cmnty Facs Dist2628 MUN 1,295,000.0079772EDA4 09/01/2026 1,5232.23611/29/2021 1,208,338.60 1.425 1.4451,336,069.40 SF Bay Area Rapid Transit Dist2029 MUN 200,000.00797669XW3 07/01/2023 3652.62102/25/2019 199,340.00 2.672 2.710199,832.18 SF Bay Area Rapid Transit Dist2572 MUN 500,000.00797669ZJ0 07/01/2024 7311.97109/08/2021 488,020.00 0.419 0.425515,363.81 SF Bay Area Rapid Transit Dist2636 MUN 480,000.00797669ZR2 07/01/2031 3,2872.76812/16/2021 443,923.20 1.846 1.872515,291.28 SF Bay Area Rapid Transit Dist2638 MUN 600,000.00797669XW3 07/01/2023 3652.62112/20/2021 598,020.00 0.572 0.580612,172.05 Sierra Joint Com. College Dist2501 MUN 585,000.00826239GD1 08/01/2029 2,5881.44503/09/2021 515,472.75 1.425 1.445585,000.00 Sierra Joint Com. College Dist2535 MUN 500,000.00826239GD1 08/01/2029 2,5881.44505/27/2021 440,575.00 1.461 1.481498,787.36 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 158 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 18 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds City of San Jose2656 MUN 350,000.00798135E96 09/01/2026 1,5232.50001/28/2022 339,741.50 1.686 1.710361,030.40 San Jose Financing Authority2622 MUN 345,000.00798153NF5 06/01/2026 1,4311.31111/18/2021 314,888.40 1.459 1.480342,798.61 San Jose Evergreen Cmnty Colll1966 MUN 315,000.00798189PK6 09/01/2027 1,8883.72810/29/2018 317,491.65 3.676 3.727315,000.00 San Jose Evergreen Cmnty Colll2105 MUN 500,000.00798189QA7 08/01/2028 2,2232.35010/01/2019 465,195.00 2.317 2.350500,000.00 San Jose Unified School Dist.1435 MUN 580,000.00798186C83 08/01/2023 3962.50001/29/2015 577,111.60 2.663 2.700578,883.77 San Jose Unified School Dist.2518 MUN 1,000,000.00798186N81 08/01/2025 1,1270.55803/15/2021 920,930.00 0.739 0.750994,182.36 Santa Monica Cmnty College Dis2025 MUN 215,000.00802385QW7 08/01/2022 312.90802/19/2019 215,154.80 2.714 2.752215,026.75 Santa Monica Cmnty College Dis2091 MUN 315,000.00802385RC0 08/01/2028 2,2233.47209/05/2019 309,307.95 1.972 2.000340,717.68 Santa Monica Cmnty College Dis2481 MUN 570,000.00802385RV8 08/01/2030 2,9531.69601/22/2021 481,387.80 1.499 1.520577,525.57 Santa Monica Cmnty College Dis2482 MUN 600,000.00802385RT3 08/01/2028 2,2231.49601/22/2021 525,426.00 1.085 1.100613,842.79 Santa Monica-Malibu USD2561 MUN 650,000.00802498VW2 07/01/2026 1,4610.98908/12/2021 589,160.00 0.877 0.890652,511.61 Santa Monica-Malibu USD2637 MUN 215,000.00802498ZA6 08/01/2026 1,4920.84912/20/2021 193,259.20 1.193 1.210211,925.12 San Mateo Cnty Comm. College D2521 MUN 2,000,000.00799038NP5 09/01/2024 7930.50004/14/2021 1,884,520.00 0.444 0.4502,002,140.67 San Mateo Cnty Comm. College D2523 MUN 1,500,000.00799038NP5 09/01/2024 7930.50004/14/2021 1,413,390.00 0.444 0.4501,501,605.51 San Mateo Foster City SCH Dist1902 MUN 1,000,000.00799017UW6 09/01/2025 1,1582.69901/16/2018 982,620.00 2.786 2.825996,424.26 San Mateo Foster City SCH Dist1940 MUN 1,000,000.00799017UW6 09/01/2025 1,1582.69903/09/2018 982,620.00 2.959 3.000991,513.52 San Mateo Foster City SCH Dist2153 MUN 1,360,000.00799017WD6 09/01/2028 2,2542.23711/07/2019 1,264,990.40 2.447 2.4801,341,727.27 San Mateo Foster City SCH Dist2178 MUN 1,565,000.00799017VM7 09/01/2028 2,2542.54212/11/2019 1,481,882.85 2.311 2.3431,582,183.40 San Mateo Foster City SCH Dist2567 MUN 500,000.00799017XW3 09/01/2026 1,5230.92509/21/2021 453,880.00 0.912 0.925500,000.00 San Mateo Foster City SCH Dist2585 MUN 175,000.00799055QV3 08/01/2026 1,4921.79909/27/2021 165,277.00 0.897 0.910181,199.67 San Mateo Foster City SCH Dist2591 MUN 1,320,000.00799055ME5 08/01/2026 1,4926.00009/29/2021 1,417,719.60 2.297 2.3291,506,019.98 Solano Cnty Community Clg Dist2176 MUN 1,150,000.0083412PFQ0 08/01/2028 2,2232.71712/09/2019 1,090,349.50 2.462 2.4961,163,782.15 Solano Cnty Community Clg Dist2579 MUN 750,000.0083412PHQ8 08/01/2026 1,4921.02510/06/2021 679,657.50 1.011 1.025750,000.00 Solano Cnty Community Clg Dist2583 MUN 200,000.0083412PGZ9 08/01/2026 1,4921.02510/06/2021 181,242.00 0.887 0.900200,994.69 Solano Cnty Community Clg Dist2594 MUN 390,000.0083412PHE5 08/01/2031 3,3181.86110/06/2021 329,475.90 1.948 1.975386,320.21 Solano Cnty Community Clg Dist2597 MUN 750,000.0083412PHU9 08/01/2030 2,9531.76110/06/2021 643,342.50 1.834 1.860744,480.17 Solano Cnty Community Clg Dist2598 MUN 825,000.0083412PHW5 08/01/2031 3,3181.86110/06/2021 696,968.25 1.879 1.905821,984.01 Solano Cnty Community Clg Dist2649 MUN 350,000.0083412PHB1 08/01/2028 2,2231.47901/07/2022 308,458.50 1.775 1.800343,576.83 Sonoma Cnty Jr. College Distr.2577 MUN 155,000.00835569GT5 08/01/2026 1,4922.44709/15/2021 149,613.75 0.843 0.855164,847.12 South Pasadena Unified School1914 MUN 180,000.00839278JM1 08/01/2027 1,8573.00002/15/2018 174,717.00 3.057 3.100179,210.32 South Pasadena Unified School2161 MUN 370,000.00839278KC1 08/01/2029 2,5885.00012/12/2019 396,921.20 2.598 2.634424,439.60 South Pasadena Unified School2162 MUN 250,000.00839278KB3 08/01/2028 2,2235.00012/12/2019 267,135.00 2.549 2.584282,737.29 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 159 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 19 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds South Pasadena Unified School2163 MUN 145,000.00839278KA5 08/01/2027 1,8575.00012/12/2019 154,063.95 2.500 2.534161,428.73 South Pasadena Unified School2164 MUN 390,000.00839278JZ2 08/01/2026 1,4925.00012/12/2019 411,602.10 2.378 2.411427,882.44 San Rafael City High Sch Distr2150 MUN 1,755,000.00799289MR1 08/01/2024 7621.96511/13/2019 1,706,211.00 1.938 1.9651,755,000.00 San Ramon Vly Unif Sch Dist.2605 MUN 1,500,000.007994082K4 08/01/2030 2,9531.91411/03/2021 1,290,165.00 1.805 1.8301,509,345.65 Sunnyvale Elementary Sch Distr2100 MUN 135,000.00867578UT1 09/01/2028 2,2542.19009/19/2019 123,877.35 2.157 2.187135,000.00 Sunnyvale Elementary Sch Distr2101 MUN 135,000.00867578US3 09/01/2027 1,8882.09009/19/2019 125,537.85 2.061 2.090135,000.00 Tracy Unified School District2493 MUN 500,000.00892404CN2 08/01/2029 2,5881.64402/08/2021 435,780.00 1.437 1.457506,197.51 Temecula Valley Unified School2539 MUN 250,000.0087970GPS0 08/01/2028 2,2231.50306/16/2021 220,482.50 1.482 1.503250,000.00 Temecula Valley Unified School2569 MUN 355,000.0087970GPQ4 08/01/2026 1,4921.05108/27/2021 323,010.95 0.887 0.900357,135.64 State of Tennessee1673 MUN 1,000,000.00880541XY8 08/01/2026 1,4922.11608/25/2016 953,490.00 1.923 1.9501,006,129.11 State of Tennessee1674 MUN 1,650,000.00880541XX0 08/01/2025 1,1272.06608/25/2016 1,593,553.50 1.893 1.9201,656,793.08 State of Tennessee1676 MUN 700,000.00880541XX0 08/01/2025 1,1272.06608/25/2016 676,053.00 1.893 1.920702,881.91 State of Tennessee2001 MUN 205,000.00880541QU4 08/01/2024 7623.72812/20/2018 207,160.70 2.860 2.900208,239.32 State of Texas1855 MUN 250,000.00882723EN5 08/01/2025 1,1273.83209/22/2017 250,295.00 2.747 2.785257,194.99 State of Texas2195 MUN 1,500,000.008827237P8 10/01/2025 1,1883.05112/23/2019 1,489,440.00 1.975 2.0031,547,988.02 State of Texas2225 MUN 940,000.008827237T0 10/01/2029 2,6493.52101/30/2020 936,240.00 2.191 2.2211,019,289.72 State of Texas2255 MUN 1,265,000.008827237T0 10/01/2029 2,6493.52102/14/2020 1,259,940.00 2.192 2.2221,371,658.44 State of Texas2311 MUN 250,000.008827237N3 10/01/2024 8232.89903/16/2020 248,042.50 1.231 1.248258,999.17 State of Texas2541 MUN 245,000.008827235K1 10/01/2025 1,1882.92206/30/2021 242,312.35 0.641 0.650262,813.12 State of Texas2548 MUN 1,000,000.00882724RF6 10/01/2030 3,0142.42607/02/2021 912,830.00 1.480 1.5011,070,989.16 State of Texas2631 MUN 500,000.00882723A90 10/01/2025 1,1882.83112/07/2021 493,130.00 1.030 1.045528,372.93 University of California2077 MUN 1,500,000.0091412GQG3 05/15/2025 1,0493.05008/26/2019 1,480,410.00 1.930 1.9571,544,300.30 University of California2095 MUN 1,000,000.0091412GQG3 05/15/2025 1,0493.05009/09/2019 986,940.00 1.797 1.8211,033,354.84 University of California2685 MUN 440,000.0091412HGF4 05/15/2027 1,7791.31604/05/2022 394,587.60 3.028 3.070405,438.57 State of Utah1731 MUN 450,000.00917542QR6 07/01/2024 7314.55401/04/2017 456,363.00 2.904 2.944462,910.75 State of Utah2306 MUN 1,500,000.00917542QV7 07/01/2025 1,0963.53903/13/2020 1,509,495.00 1.948 1.9751,566,472.64 State of Washington1672 MUN 250,000.0093974DHW1 08/01/2022 312.74008/08/2016 250,122.50 1.504 1.524250,245.52 State of Washington1721 MUN 515,000.0093974CPH7 08/01/2022 314.63612/05/2016 515,947.60 2.465 2.500515,849.67 State of Washington1802 MUN 485,000.0093974CRC6 08/01/2024 7624.66905/23/2017 496,838.85 2.416 2.450505,437.75 State of Washington2196 MUN 500,000.0093974CRC6 08/01/2024 7624.66912/24/2019 512,205.00 1.978 2.005526,372.21 State of Wisconsin2547 MUN 2,000,000.0097705MNU5 05/01/2031 3,2262.45107/02/2021 1,812,620.00 1.553 1.5752,142,834.93 State of Wisconsin2574 MUN 1,500,000.0097705MNP6 05/01/2026 1,4002.08909/09/2021 1,438,815.00 0.739 0.7501,575,520.33 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 160 June 30, 2022 Par Value Days To Maturity Maturity Date Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 20 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Municipal Bonds State of Wisconsin2576 MUN 1,000,000.0097705MNP6 05/01/2026 1,4002.08909/13/2021 959,210.00 0.769 0.7801,049,176.98 Yosemite Community College Dis2657 MUN 1,000,000.00987388GX7 08/01/2027 1,8572.08202/17/2022 940,460.00 2.053 2.0821,000,000.00 Subtotal and Average 209,322,603.30 204,650,000.00 196,072,145.60 2.021 2.049 1,590 Supranationals (World Bank) Bonds Inter-American Dev. Bank1978 IADB 1,500,000.004581X0CZ9 09/14/2022 751.75011/09/2018 1,498,935.00 3.106 3.1501,496,017.84 Inter-American Dev. Bank2528 IADB 2,000,000.004581X0DV7 04/20/2026 1,3890.87504/20/2021 1,836,760.00 0.910 0.9231,996,425.39 Inter-American Dev. Bank2586 IADB 2,000,000.0045818WDH6 06/17/2026 1,4470.80009/27/2021 1,839,380.00 0.914 0.9271,990,161.05 Inter-American Dev. Bank2652 IADB 1,000,000.004581X0EB0 01/13/2027 1,6571.50001/13/2022 930,610.00 1.504 1.525998,893.87 Inter-American Dev. Bank2655 IADB 1,000,000.004581X0EB0 01/13/2027 1,6571.50001/14/2022 930,610.00 1.518 1.540998,258.23 Intl Bk Recon & Development1976 IBRD 1,500,000.00459056LD7 01/19/2023 2027.62511/08/2018 1,539,030.00 3.111 3.1551,534,273.81 Intl Bk Recon & Development1982 IBRD 1,000,000.00459058GL1 09/27/2023 4533.00011/27/2018 999,760.00 3.018 3.060999,307.40 Intl Bk Recon & Development2470 IBRD 1,500,000.00459058JL8 10/28/2025 1,2150.50001/08/2021 1,375,455.00 0.480 0.4871,500,620.64 Intl Bk Recon & Development2492 IBRD 1,500,000.00459058JS3 02/10/2026 1,3200.65002/10/2021 1,349,790.00 0.641 0.6501,500,000.00 Intl Bk Recon & Development2497 IBRD 1,500,000.0045905U5Y6 02/18/2026 1,3280.60002/18/2021 1,371,570.00 0.591 0.6001,500,000.00 Intl Bk Recon & Development2498 IBRD 1,500,000.00459058JL8 10/28/2025 1,2150.50002/18/2021 1,375,455.00 0.591 0.6001,495,088.40 Intl Bk Recon & Development2510 IBRD 1,500,000.00459058JL8 10/28/2025 1,2150.50003/01/2021 1,375,455.00 0.787 0.7981,485,428.29 Intl Bk Recon & Development2534 IBRD 1,500,000.00459058JS3 02/10/2026 1,3200.65005/26/2021 1,349,790.00 0.833 0.8451,489,672.03 Intl Bk Recon & Development2553 IBRD 1,500,000.00459058JS3 02/10/2026 1,3200.65007/15/2021 1,349,790.00 0.839 0.8511,489,339.51 Intl Bk Recon & Development2559 IBRD 1,500,000.00459058JS3 02/10/2026 1,3200.65008/12/2021 1,349,790.00 0.871 0.8831,487,652.68 Intl Bk Recon & Development2650 IBRD 1,000,000.0045906M2L4 02/24/2026 1,3340.65001/07/2022 914,600.00 1.368 1.387973,951.92 Intl Bk Recon & Development2673 IBRD 1,000,000.0045906M2Z3 03/17/2025 9902.05003/17/2022 975,660.00 2.107 2.136997,740.74 International Finance Corp.2441 IFC 1,000,000.0045950VPE0 10/15/2025 1,2020.25010/30/2020 916,570.00 0.497 0.5041,000,000.00 International Finance Corp.2454 IFC 1,500,000.0045950VPH3 11/15/2025 1,2330.25011/30/2020 1,380,300.00 0.683 0.6921,500,000.00 International Finance Corp.2483 IFC 1,500,000.0045950VPJ9 01/15/2026 1,2940.58001/25/2021 1,371,825.00 0.501 0.5081,503,736.59 International Finance Corp.2502 IFC 1,500,000.0045950VPJ9 01/15/2026 1,2940.58002/11/2021 1,371,825.00 0.522 0.5301,502,606.89 International Finance Corp.2503 IFC 1,500,000.0045950VPS9 02/26/2026 1,3360.50002/26/2021 1,368,510.00 0.616 0.6251,493,267.30 International Finance Corp.2514 IFC 2,000,000.0045950VPT7 03/15/2026 1,3530.50003/15/2021 1,846,940.00 0.808 0.8192,000,000.00 International Finance Corp.2515 IFC 1,500,000.0045950VPU4 03/23/2026 1,3610.75003/23/2021 1,382,535.00 0.746 0.7571,499,597.40 International Finance Corp.2517 IFC 2,000,000.0045950VPU4 03/23/2026 1,3610.75003/23/2021 1,843,380.00 0.887 0.9001,989,070.16 International Finance Corp.2532 IFC 1,500,000.0045950VPY6 05/15/2026 1,4140.50005/28/2021 1,407,525.00 1.006 1.0201,500,000.00 International Finance Corp.2654 IFC 1,000,000.0045950KCX6 10/08/2026 1,5600.75001/12/2022 902,550.00 1.518 1.540967,587.55 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 161 June 30, 2022 Current RateMarket Value Fund ALL - Portfolio Listings Investments by Fund Page 21 CUSIP Investment #Issuer Purchase Date Book Value YTM 360 YTM 365 Subtotal and Average 38,888,697.69 39,000,000.00 36,154,400.00 1.091 1.106 1,220 Total Investments and Average 590,753,776.97 584,722,536.47 552,545,616.66 1.593 1.615 1,407 Portfolio CPA AP Run Date: 07/19/2022 - 16:21 FI (PRF_FI) 7.3.11 Report Ver. 7.3.11 9.b Packet Pg. 162 1 General Investment Guidelines:Full Compliance a) The max. stated final maturity of individual securities in the portfolio should be 10 years. b) A max. of 30 percent of the par value of the portfolio shall be invested in securities with maturities 28.03% beyond 5 years. c) The City shall maintain a minimum of one month's cash needs in short term investments. d) At least $50 million shall be maintained in securities maturing in less than 2 years. Plus two managed pool accounts which provide instant liquidity: - Local Agency Investment Fund (LAIF) - maximum investment limit is $75 million $42.9 million - Fidelity Investments $3.7 million e) Should market value of the portfolio fall below 95 percent of the book value, report this fact within a 93.52% reasonable time to the City Council and evaluate if there are risk of holding securities to maturity. d) Commitments to purchase securities newly introduced on the market shall be made no more than three (3) working days before pricing. f) Whenever possible, the City will obtain three or more quotations on the purchase or sale of comparable securities (excludes new issues, LAIF, City of Palo Alto bonds, money market accounts, and mutual funds). 2 U.S. Government Securities:Full Compliance a) There is no limit on purchase of these securities. b) Securities will not exceed 10 years maturity. 3 U.S. Government Agency Securities:Full Compliance a) There is no limit on purchase of these securities except for: Callable and Multi-step-up securities provided that: - The potential call dates are known at the time of purchase; - the interest rates at which they "step-up" are known at the time of purchase; and - the entire face value of the security is redeemed at the call date. - No more than 25 percent of the par value of portfolio.24.30% b) Securities will not exceed 10 years maturity. 4 California State, California Local Government Agencies, and other United States State Bonds:Full Compliance a)Having at time of investment a minimum Double A (AA/Aa2) rating as provided by a nationally recognized rating service (e.g., Moody’s, Fitch, and/or Standard and Poor’s). b)May not exceed 40 percent of the par value of the portfolio.35.01% 5 Certificates of Deposit (CD):Full Compliance a) May not exceed 20 percent of the par value of the portfolio;None Held b) No more than 10 percent of the par value of the portfolio in collateralized CDs in any institution. c) Purchase collateralized deposits only from federally insured large banks that are rated by a nationally recognized rating agency (e.g. Moody's, Fitch, and/or Standard & Poor's). d) For non-rated banks, deposit should be limited to amounts federally insured (FDIC) e) Rollovers are not permitted without specific instruction from authorized City staff. 6 Banker's Acceptance Notes (BA):Full Compliance a) No more than 30 percent of the par value of the portfolio.None Held b) Not to exceed 180 days maturity. c) No more than $5 million with any one institution. $107.5 million 2.31% Attachment C Investment Policy Compliance As of June 30, 2022 Investment Policy Requirements Compliance Check / Actual 9.c Packet Pg. 163 Attachment C Investment Policy Compliance As of June 30, 2022 Investment Policy Requirements Compliance Check / Actual 7 Commercial Paper:Full Compliance a) No more than 15 percent of the par value of the portfolio.None Held b) Having highest letter or numerical rating from a nationally recognized rating service. c) Not to exceed 270 days maturity. d) No more than $3 million or 10 percent of the outstanding commercial paper of any one institution, whichever is lesser. 8 Short-Term Repurchase Agreement (REPO):Full Compliance a) Not to exceed 1 year.None Held b) Market value of securities that underlay a repurchase agreement shall be valued at 102 percent or greater of the funds borrowed against those securities. 9 Money Market Deposit Accounts Full Compliance a) Liquid bank accounts which seek to maintain a net asset value of $1.00. 10 Mutual Funds:Full Compliance a) No more than 20 percent of the par value of the portfolio.None Held b) No more than 10 percent of the par value with any one institution. 11 Negotiable Certificates of Deposit (NCD):Full Compliance a) No more than 20 percent of the par value of the portfolio.4.98% b) No more than $5 million in any one institution.Federally Insured 12 Medium-Term Corporate Notes:Full Compliance a) No more than 10 percent of the par value of the portfolio.4.46% b) Not to exceed 5 years maturity. c) Securities eligible for investment shall have a minimum rating of AA or Aa2 from a nationally recognized rating service. d) No more than $5 million of the par value may be invested in securities of any single issuer, other than the U.S. Government, its agencies and instrumentality. e) If securities owned by the City are downgraded by either rating agencies to a level below AA it shall be the City's policy to review the credit situation and make a determination as to whether to sell or retain such securities. 13 Supranational Organizations Securities:Full Compliance a) Securities will not exceed 5 years maturity b) No more than 20 percent of the par value of the portfolio.6.67% c) No more than 10 percent in any one institution. d) Securities eligible for investment shall have a minimum rating of AA or Aa2 from a nationally recognized rating service. 14 Prohibited Investments: a) Reverse Repurchase Agreements b) Derivatives as defined in Appendix B of the Investment Policy 15 All securities shall be delivered to the City's safekeeping custodian, and held in the name of the City, with the exception of : - Certificates of Deposit, Mutual Funds, and Local Agency Investment Fund (LAIF) Full Compliance None Held Full Compliance 9.c Packet Pg. 164 City of Palo Alto (ID # 14466) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Information Reports City of Palo Alto Page 1 Title: Fiscal Year 2022 Annual Evaluation Report for the Santa Clara County Multi -Jurisdictional Program for Public Information on Flood Preparedness and Awareness, and the Resulting Community Rating System Flood Insurance Discounts From: City Manager Lead Department: Public Works Recommendation This is an informational report and no Council action is required. Background The CRS is a voluntary program under the Federal Emergency Management Agency’s (FEMA) National Flood Insurance Program that allows communities to earn flood insurance premium discounts for their residents and businesses. Communities earn CRS credit points for activities that promote flood risk reduction practices and encourage residents and businesses to purchase flood insurance. CRS Class Ratings are assigned at 500-point increments, and each improvement in Class Rating nets an additional 5% flood insurance premium discount. The CRS Class Ratings range from 1 to 10, with 10 being the lowest rating and 1 being the highest. The City of Palo Alto has participated in the CRS program since 1990 and has been rated as a Class 6 community since 2017, affording residents and businesses a 20% or 10% (outside of Special Flood Hazard Area, or SFHA) discount on their flood insurance premiums. The CRS rating was due to a significant effort on flood awareness and floodplain management by the City. Neighboring cities have earned similar CRS ratings (Mountain View – 7, East Palo Alto – 7, Los Altos – 8, Sunnyvale – 7). The CRS Coordinator’s Manual includes the option to implement a regional Program for Public Information (PPI). Under the PPI, a community or group of communities work together to create and deliver customized and consistent flood risk reduction outreach messages. By disseminating these messages each community earns points that can improve their CRS rating. The number of CRS credit points earned depends on how extensive the implemented program is within each community’s boundaries. City of Palo Alto has earned up to 122 points for its PPI efforts. City of Palo Alto residents and businesses pay $3.4 million (per FEMA data as of May 3, 2022) 10 Packet Pg. 165 City of Palo Alto Page 2 for flood insurance premiums per year. The total savings from the 20% insurance discount achieved by the City on behalf of its residents due to its CRS part icipation is approximately $700,000 per year (per FEMA data as of May 3, 2022). Without CRS, the residents and businesses would have paid $4.1 million. Palo Alto participates in the Santa Clara County Multi- Jurisdictional program to enhance the effectiveness of the flood risk messages to residents, reduce flood risks, and to maintain or improve the City’s CRS rating of 6. As required by the terms of the PPI, the regional PPI committee must convene annually to evaluate whether the flood risk reduction messages are still appropriate and adjust them as needed. A report to FEMA must be submitted annually describing the PPI implementation. The annual report is transmitted to the council of each participating agency to provide updates on the various flood preparedness and awareness outreach programs that the Santa Clara County Multi-Jurisdictional PPI has undertaken for the past year. Discussion The annual report for the 2022 Santa Clara County Multi-Jurisdictional PPI is provided as information for Council. The report highlights the elements of the flood safety outreach programs implemented by the eleven Santa Clara County communities (Cupertino, Gilroy, Los Altos, Milpitas, Morgan Hill, Mountain View, Palo Alto, San Jose, Santa Clara, Santa Clara County, and Sunnyvale) that participate with the Santa Clara Valley Water District (Valley Water) in CRS. Valley Water, along with representatives from each of the participating communities, developed the original 2015 PPI and the associated annual report. The committee meets annually to evaluate and approve the PPI. The attached 2022 report was created bas ed on meetings that occurred on March 10 and May 19, 2022. The final version of the 2022 PPI was presented to and approved by Valley Water’s Board of Directors on July 15, 2022. The worksheet on Appendix A of Attachment A lists the outreach projects, impl ementing agencies, and the messages associated with each of the projects; similarly, Appendix B of Attachment A lists the non-credited CRS outreach projects. Every year, participating communities must present the PPI plan to the legislative bodies to continue receiving CRS credit. The 2021 Santa Clara County Multi-Jurisdictional PPI was presented to Council on June 14, 2021 (Staff Report ID# 12264). Staff will continue to provide information to Council on the Santa Clara County Multi-Jurisdictional PPI on a yearly basis after the end of each Fiscal Year to achieve the maximum number of CRS credit point s and associated flood insurance premium discounts for the community. Stakeholder Engagement The program was discussed and prepared by representative staff from the eleven participating communities. Resource Impact 10 Packet Pg. 166 City of Palo Alto Page 3 The review and approval of this informational report has no impact on the City’s budget. Maintaining this rating and participation in this program saves the Palo Alto community 20% on flood insurance costs. Environmental Review This is an informational report and not subject to the California Environmental Quality Act (CEQA). 10 Packet Pg. 167 City of Palo Alto (ID # 14620) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Information Reports City of Palo Alto Page 1 Title: City Council Recess Report From: City Manager Lead Department: City Manager DISCUSSION The following informational report provides a brief update on activities accomplished during the City Council’s July recess. The updates are organized by depart ment. While the summary is not an exhaustive list of staff activities, it seeks to inform the City Council and the broader community about items completed since the last City Council meeting of the fiscal year or recent efforts underway. The report is transmitted with the August 8 City Council meeting packet. Administrative Services Department End of Fiscal Year and New Fiscal Year Activities Administrative Services Department (ASD) staff have been focusing on annual steps needed to transition from one fiscal year to a new fiscal year, it is the “New Year” for financial staff. This year, in partnership with the Information Technology Department, staff was able to increase automation of software processes needed on June 30 to transition to the new fiscal yea r on July 1. This increased automation helped this work effort finishing during normal business hours for the first time in years! Staff also completed other year-end activities including the annual inventory of both warehouses at the Municipal Services Center and Regional Water Quality Control Plant (RWQCP). This annual process requires the physical count of inventory and resulted in no material discrepancies. Staff implemented employment contract terms for payroll processing such as the sunset of provisions implemented for adaptation to the pandemic including changes to leave accrual balances on June 30, 2020. Additionally, staff is actively working on publishing the FY 2023 Adopted Operating and Capital Budget books, targeting an August release date. Staff published the FY 2023 Municipal Fees, available online. Other Administrative Activities 11 Packet Pg. 168 City of Palo Alto Page 2 Other staff activities included a focus on employee recruitment and retention, with three active recruitments underway and two new employees beginning in critical roles. An additional Storekeeper in the warehouse (approved in the FY 2023 Adopted Budget) will ensure a safe working environment and the Finance Manager will supervise all accounting functions, including payroll and accounts payable activities. Throughout this summer, staff continued to support the activities of two Council Ad Hoc committees for the exploration of potential ballot measures as part of the November 2022 election as well as the review of documents in relationship to the ROTH building and partnership with the Palo Alto History Museum. The Purchasing division engaged internal stakeholders to review and improve the City’s procurement process as part of the Purchasing Redesign Project. Staff successfully timed the sale of securities to ensure no loss to the City in order to meet cash-flow needs including the pre-payment of the unfunded accrued liability annual actuarial determined payment. City Manager’s Office Three Assistant to the City Manager and Communications Coordinator positions were filled in July, all expected to start in August. The Assistant to the City Manager positions (approved by the City Council as part of the FY 2023 Adopted Budget) will focus on key areas such as housing, economic development and other priorities. Uplift Local Update Per Council direction, the Uplift Local closed streets program was extended to December 31, 2023, and adopted access and perimeter rules such as implementation of an emergency access lane, edge treatments no taller than 36” placed around retail and dining spaces, elimination of large tents, and re-established the eight-foot sidewalk width. In order to truly refresh the space, staff planned the physical changes to include a much -needed deep cleaning of the streets and sidewalks. By Friday, August 5, businesses are required to remove all large tents. During the week of August 8-11, Public Works staff and a City contractor will perform sweeping and power washing of the streets and sidewalks. Cleaning will be performed overnight so that businesses can continue to operate during daytime business hours. Businesses will remove a ll items from the street and sidewalk prior to the nightly cleaning. Once the roads are clean, a City crew will install intermittent striping in front of businesses that use the streets for business operations, which will create the “invisible” emergency access lane down the center of California Avenue and Ramona Street. Coordinated barrier wraps and pole banners will be installed in downtown and on California Avenue that will feature work from local artists. Additionally, staff began working with a consultant to further develop the closed streets, compile a scope of work for the closed streets alternative analysis study, and create a stakeholder engagement plan that will assist with both efforts. Federal Grant Earmarks Approved 11 Packet Pg. 169 City of Palo Alto Page 3 On June 30, Senator Josh Becker shared that the City will receive $2M in funding to replace the 100-year old Newell Road Bridge at San Francisquito Creek. Staff continue to work on the design and are working on a grant application with California Consulting due in mid -September. In addition, thanks to Assemblymember Marc Berman, the City will receive $5.4M in funding for the Fire Station 4 replacement project. Community Services Department Summer Camps The Community Services Department (CSD) offered a full menu of summer camps includin g music, dance and theatre, art, science, sports/recreation, and popular Foothills camps. Special interest camps are also offered such as LEGO, technology, writing, and cooking camps. Most camps are offered in person, with a few academic camps in virtual f ormat. Roughly 3,000 youth were served through the City’s camps. Vice Mayor Kou made a special appearance on July 1 at the Young Mayors Kidizens camp, where “kidizens” build small-scale cities with LEGOs and learn how their decisions impact others in their community. The campers built cities that included police stations, schools, grocery stores, fire stations, and more. Special Events CSD continued to host events in July, offering a safe and welcoming space for the community to come together, including family movie nights and the July 4th Festival at Mitchell Park featuring live music, a DJ, games and art activities for kids, inflatables, and food trucks. The 2022 Twilight Concert Series, overseen by staff from Palo Alto Children’s Theatre, kicked off on June 25 with a World Music Day Celebration. Presented in collaboration with the Palo Alto Recreation Foundation in Rinconada Park, a diverse roster of acoustic musicians play in the park throughout the day, culminating in an evening concert by the Bay Area Beatles cover band, The Sun Kings. In July, the Twilight Concert Series continued with two concerts featuring popular bands “In the Led” (Led Zepelin tribute band) and “Carnaval” (celebrating the music of Santana) on July 9 and 23. This year’s concert series continues through August at Mitchell Park with Grammy-Award winning musician Mads Tolling on August 6, Heartless on August 13, and The Boys of Summer on August 20. CSD also supports the Magical Music and Motion Summer Concert Series at the Magical Bridge Playground on Friday nights, May through September. The Palo Alto Children’s Theatre Summer Hot Dog Series production of Goldilocks and the Three Bears completed performances in July, before opening The Stinky Cheese Man on July 20, with performances running through August 7. In addition to a busy roster of summer camps and classes, the Children’s Theatre expanded its Magical Series, spectrum and sensory friendly programming, to include free Music Therapy classes at Mitchell Park Library and Saturday Summer Sing-Alongs held at the Magical Bridge Playground in Mitchell Park. In July, the Children’s Theatre concluded its fourth annual collaboration with the Stanford University Engineering Department’s Compression Forum, with this summer’s research project focused on the creation of a virtual interactive experience that explores human interaction with algorithms. 11 Packet Pg. 170 City of Palo Alto Page 4 Public Art initiated a new round of ten ArtLift Microgrant projects in July that will provide more than twenty uplifting community engagements, workshops, performances, and installations through the end of September. Artist in Residence, Rayos Magos, completed the community engagement portion of his residency, which included 21 workshops as well as conducting interviews and gathering stories through his Five Box Project installed at Palo Alto City Libraries. Rayos Magos is working on design development for his temporary artwork in King Plaza, which will be installed this fall. Information and how to sign -up is available on the Public Art Program website. The Art Center opened its new exhibit RESTART in late June and hosted a free Friday Night at the Art Center for the community on July 1. RESTART showcases how art can promote healing, connection, and restoration and is the Art Center’s first juried exhibition in more than a decade. The exhibition features work from a wide range of media by Northern California artists, including six artists from Palo Alto. RESTART is on view through August 20. The Art Center also hosted the annual Palo Alto Clay and Glass Festival on July 9-10 and resumed its free virtual meditation sessions with stress management consultant Julie Forbes on Thursdays at noon through August 25. Sessions will rotate each week between mindful meditation, body scan, loving kindness, and guided visualization, with some gentle movement activities. Parks and Open Space Open Space Rangers provided support to Public Works and Fire Department staff to clear brush and vegetation along Arastradero Road and Page Mill Road to reduce fire risk in the Foothills. Rangers closely monitored Open Space Preserves on July 4 to monitor visitors and prevent illegal fireworks. Parks and Tennis Courts Maintenance Parks staff continued to maintain neighborhood parks, athletic fields, and courts with an emphasis on water conservation. While staff reduced irrigation, specifically targeting aesthetic grass areas, particular care is being taken to ensure that trees continue to be adequately irrigated. On July 20, 2022, a contractor completed the resurfacing of the Cubberley and Peers Park tennis courts, which were in dire need of repair. Office of Emergency Services The City’s Office of Emergency Services (OES) continued to support pandemic-related functions, both internal to City operations as well as regional coordination with the County of Santa Clara. The Emergency Operations Center (EOC) posture remained in “virtual” mode, with OES staff in the office, at the Mobile Emergency Operations Center (MEOC), and other sites. OES led the annual 4th of July Safety Watch that involved agencies such as CAL FIRE, the Midpeninsula Regional Open Space District, San Mateo County, Santa Clara County, and other state and local agencies. 11 Packet Pg. 171 City of Palo Alto Page 5 OES continued to work with regional partners to improve wildfire safety. This includes the alertwidlfire.org program, with new equipment at the Montebello Reservoir and other locations. Internally, OES worked with the Foothills Fire Management Team to coordinate various City departments (Fire, Public Works, Utilities, Community Services, etc.) to continue mitigation work, such as roadside clearing of brush per the Foothills Fire Management Plan. OES also conducted numerous public outreach and education events such as the MSC Open House and training and exercises for the Emergency Services Volunteer (ESV) program. Fire Department Fire Station 8 Staffing Palo Alto Fire (PAFD) and Santa Clara County Fire (SCCFD) firefighters began staffing Fire Station 8 in the Palo Alto Nature Preserve. The summer of 2022 is the second fire season that PAFD and SCCFD staffed Fire Station 8 since the Tri-Party Fire Agreement for Foothills Fire Station staffing was signed in June 2021. Fire Station 8 is occupied every day between 8 a.m. and 8 p.m. and is available to respond to emergencies that occur in Palo Alto, Los Altos Hills, and surrounding open spaces. This staffing rotation will continue until the end of fire season, typically in November. Santa Clara County Joint Fire Academy Graduation On July 8, the Palo Alto Fire Department graduated ten firefighters from the Santa Clara Joint Fire Academy (SCCJFA). The SCCJFA wrapped up after eighteen weeks of firefighter and Emergency Medical Services training with partnering agencies, Milpitas Fire Department, Santa Clara County Fire Department, and South Bay Regional Consortium. There were two women in the academy, both of whom are Palo Alto Fire Department hires. Both women were Palo Alto Fire Department cadets before they became PAFD recruits. Battalion Chief Promotion The Palo Alto Fire Department conducted a promotional process for the Battalion Chief position. Human Resources personnel and nine chief officers from five different counties representing nine fire agencies assisted in the assessment center. As a result, Marc Muzzi was promoted to Battalion Chief on July 16. Human Resources Department Human Resources staff continue to focus on employee recruitment and hiring new talent. In June and July, 90 new hires were onboarded. HR partnered with Community Services to hire 57 of these new hires to lead summer camps. Other successfully completed recruitments include placement for three Assistant to City Managers positions who will focus on Housing, Economic Development, and other priorities. Other positions filled include: 11 Packet Pg. 172 City of Palo Alto Page 6 • Utilities Assistant Director, Engineering • Sustainability Program Administrators (2) • Assistant Power Engineer • Associate Power Engineer • Planner In addition, there were 13 promotions including a Battalion Chief recruitment resulting in the promotion of Captain Marc Muzzi, who has served Palo Alto for 22 years. Human Resources staff also completed the critical and extensive Police Chief recruitment process. In June, negotiated salary increases were processed and implemented for the Fire Chief’s Association, the International Association of Firefighters, and Service Employee International Union hourly employee group. Most recently, negotiations with SEIU launched and will continue the bargaining process with a goal to reach agreement of a new contract and bring to Council for approval by the end of 2022. Finally, a significant amount of staff’s time and resources continue to be required to track, monitor, and complete reporting requirements related to COVID-19, including assisting the administration of employee and community testing, which remains available daily Monday to Thursday each week. Library Department Events & Activities The 2022 Summer Reading Program launched on June 1 with nearly 1500 signups. This year’s theme of “All Together Now” provides participants a unique opportunity to read for a cause. For every participant who completes the program, the Library will donate $1 to the Palo Alto Community Fund (PACF), an organization which provides grants to non-profits that improve the quality of life for everyone in our community. With the start of Summer Reading Program, the Library also launched in-person events for all ages. A Little Ones Storytime in the Secret Garden at Children’s Library attracts a weekly crowd of 80+ babies and caregivers. The summer’s “What’s Up Wednesdays” series has provided performances and craft activities for all ages at Children’s, Mitchell Park, and Rinconda Libraries. The Seed Library has returned to Rinconada Library. It is currently stocked with native wildflower seeds from the #PlantWildFlowers grant courtesy of HHMI Tangled Bank Studios and PBS Nature. Reboot Services at Mitchell Park Library quietly launched in mid-July. The newly re-vamped Ventura Technology Learning Center on the 2nd floor, provides a variety of hands-on technology workshops, in-person help with eBooks and other digital resources, and the return of the popular Vintage Media Lab, which provides equipment to digitize old formats, such as photos 11 Packet Pg. 173 City of Palo Alto Page 7 and video cassettes. The Library is currently offering Reboot Room tours and Vintage Media Lab appointments. Coming Soon The Library will be expanding hours at all locations later this year, including adding a fourth service day at Children’s, College Terrace, and Downtown Libraries; and a sixth day at Mitchell Park and Rinconda Libraries. The Library is still filling vacancies to meet these expansion plans. Planning and Development Services Department Boards and Commissions Continued to Meet Planning and Development Services continued to staff meetings and hearings of commissions and boards during July including the Historic Resources Board, Planning and Transportation Commission, and Architectural Review Board. Topics discussed included permanent parklet standards, courtesy review of the Project Homekey, consideration of accessory dwelling unit policy development, and more. Safe Parking Neighborhood Check In The Department held a virtual Safe Parking Neighborhood Check In for a proposed congregation-based safe parking permit at First Congregational Church at 1985 Louis Road. Over 80 participants attended the event. Staff, the applicant, and the safe parking program operator answered questions from attendees and shared information about the proposed permit. An appeal of the permit has been filed. Appeal of safe parking permits are adjudicated by the City Council, which will be scheduled soon. Policy Development Staff continue to develop policies related to notable topics such as hazardous materials, green building, and the 2022 triennial building code update. A potential moratorium on hazardous materials, previously contemplated for Council action in June, was deferred to allow staff additional time to develop a stronger understanding of current and potential new regulations. Staff are preparing outreach to local stakeholders in advance of City Council discussions on this topic. The triennial building code update also presents an opportunity to explore local energy reach codes. Staff have been preparing for two outreach meetings to occur in August. Every three years, the State adopts new building standards referred to as the California Building Standards Code. While the State sets the minimum building standards, local jurisdictions can enact more stringent local building standards based on unique local climatic, geologic, and topographic conditions. The City’s proposed 2022 green building regulations aim to increase water conservation and reduce water loss, lower embodied carbon in new construction projects, reduce fossil fuel use in buildings, and facilitate electric vehicle adoption by community members and visitors to Palo Alto. The two upcoming meetings will be held on August 16 and August 18 (both scheduled from 6 p.m. to 8 p.m.) to provide background information 11 Packet Pg. 174 City of Palo Alto Page 8 and create an opportunity for community input on these new proposals. Community input gained will help inform the City Council as they consider staff recommendations later this fall. A new webpage is available for the public to learn more about the proposed green building and local energy code updates here. Project Homekey Staff continue collaboration with LifeMoves to develop an 88-bed shelter facility on San Antonio Road. Efforts include meetings to review plans for the proposed site to provide feedback and problem solve. In addition, the Architectural Review Board met on July 21, 2022 and provided non-binding comments on the proposed design. Hiring The Department continues to work with Human Resources to recruit and fill vacant positions— including newly approved positions in the FY 2023 budget. An offer was made to a building inspector, two new planners were hired, and two planners in Current Planning were promoted. The summer also included the conclusion of Rachael Tanner’s tenure with the City of Palo Alto; she served as assistant director of PDS from 2019 through the end of July. Police Department Recruiting and Hiring The Department is focused on the recruitment and hiring of qualified cand idates to fill current vacancies this fiscal year: (14) police officers (9 vacant/5 hire -ahead for pending vacancies), (5) Dispatchers (4 vacant/1 hire-ahead for pending vacancies), (2) Records Specialists, (1) Business Analyst, (1) Admin Associate. The Department has been working collaboratively with HR to advance the recruitment and hiring processes in this competitive hiring environment. Currently, there are (5) officers in the Field Training Program and (4) in the police academy. New Police Chief Selection The City Manager has announced the selection of Acting Chief Andrew Binder as the City’s Chief of Police, following the retirement of former-Chief Robert Jonsen in July. This appointment will be considered by the City Council on August 8 and if confirmed, Chief Binder would become the 11th police chief in the 128-year history of Palo Alto. Personnel in the Department are excited to welcome Chief Binder and are enthusiastic to continue their service to the residents, businesses, and visitors to Palo Alto under his leadership. New Efforts in Public Communications Staff worked over the summer to develop ways to re-engage with the community online, after the reduction in staffing due to the global pandemic and economic shifts limited the Department’s budget. The Department shuffled resources and worked with employees to solicit 11 Packet Pg. 175 City of Palo Alto Page 9 online content from all workgroups, and recently began new efforts to share more information (especially pictures and videos) via social media highlighting police personnel, the work they do on a daily basis, and the bonds they have with our community. The Department will continue engaging with the community online by using social media to have two-way conversations with community members whenever possible, answer questions, provide information, and address concerns in a public way. These efforts are currently underway and are intended to be another way that staff are “getting back to normal.” Below is media inquiry response data for Palo Alto Police Department in June 2022. Media Inquiries Handled: 18 Staff continued to track these inquiries to ensure response to media requests. Watch Commanders continue to be responsive and accessible, and prioritizing media inquiries appropriately and the web form continues to increase effectiveness and efficiencies of staff supporting these inquiries. Staff responded to requests on the same workday 100% of the time in June (18 of 18 inquiries). In mid-June at the annual shift change, the two Watch Commanders who will be handling media inquiries for the foreseeable future are David Lee and Con Maloney. Number of news releases proactively distributed in June 2022: 5 Total media inquiries handled by PAPD in June 2022: 18 Shortest response time: 5 minutes Longest response time to one of those 18 inquiries: 6 hours and 2 minutes Other Stats: Response time on each of the 18 inquiries • More than 24 hours: 0 (0%) • Within 24 hours: 18 (100%) • Same work-day response: 18 (100%) • Between 90 minutes and 24 hours: 5 (28%) • Within 90 minutes: 13 (72%) • Within 30 minutes: 6 (33%) Method of response to all 18 inquiries • Via e-mail with reporter: 13 (72%) • Via phone conversation with reporter: 5 (28%) 11 Packet Pg. 176 City of Palo Alto Page 10 • Daily Post: 5 Making Community Connections Due to the pandemic, the Department had largely been unable to continue the longstanding tradition of formal community interaction opportunities during the past two years. Over the summer, staff spent time planning how to bring back many of those opportunities moving forward. National Night Out on August 2 is the first example of this, and staff planned a free block party open to the public to bring the police and community together over food, games, and conversations. Police are also planning on visiting several resident-hosted block parties throughout town that night. Other planned community events, set to debut again this fall and winter, include the Department’s popular Basic Citizens Police Academy, “Breaking with the Law” gatherings (our unique spin on “Coffee with a Cop” events that other agencies often host), and other opportunities for outreach with our schools, community groups, resident associations, nonprofits, and businesses. Public Works Department Progress on Public Safety Building and Charleston/Arastradero Corridor Project Significant progress was made on the Public Safety Building (PSB) and Charleston/Arastradero Corridor projects this summer. The PSB reached a key milestone and “topped out” on June 24, pouring the roof of the third story. Since then, work started on the construction masonry unit (CMU) walls in the basement levels and ongoing mechanical, electrical, and plumbing work continues. Two thirds of the Phase 3 section of the Charleston/Arastradero Corridor project were paved and striped, concrete medians and irrigation lines were installed, and work on the El Camino Real/Arastradero intersection began. Other Capital Projects Several construction projects made significant progress and are nearing completion including Mitchell Park Library roof and gutter redesign/construction, Municipal Service Center re roofing, and street resurfacing construction projects. The Citywide building assessment started and the draft facility and electrification assessment report was completed and is now being reviewed by staff. Additionally, prior to Council’s summer break, the design contract for Fire Station #4 was approved and staff held the design kick-off meeting in July. Several important Regional Water Quality Control Plant (RWQCP) projects are going through the procurement process and have either already started or ar e beginning shortly. The projects include the RWQCP’s 12kV Electrical Loop Rehabilitation, Primary Sedimentation Tank Rehabilitation, and Secondary Treatment Upgrades projects. Foothills Roadside Vegetation Clearance/Fire Prevention 11 Packet Pg. 177 City of Palo Alto Page 11 Roadside vegetation clearance and dead tree removals began on Arastradero Road, Los Trancos Road, and Page Mill Road. Work was completed on Arastradero Road and Los Trancos Road. Work on Page Mill Road is in progress. This year, the work is being performed with in -house crews from Public Works and Community Services Department Open Space staff provide fire watch and firefighting equipment during the work in coordination with the Fire Department. Fire mitigation work involves clearing dry grass 15 feet from the edge of the road or to a fence line and removing dead trees. Work on Page Mill Road includes 3.3 miles of road from Foothills Park up to Monte Bello parking reserves. Due to the rugged terrain and slope, much of the work has to be done manually by a crew of 8-10 employees. Hot weather and poison oak add to the challenge. In parallel with this work, the Foothills Fire Management Plan team is working on preparing a scope of work and bid documents to contract this work out. TESLA Supercharging Stations Installation at Bryant Street Parking Garage TESLA is nearly complete with the installation of 19 supercharging stations on the 3 rd floor of the Bryant Street parking garage. Many City departments including the City Manager’s Office, Attorney’s Office, Office of Transportation, Utilities, and Public Works had a hand in bringing this project to fruition. The contractor is currently waiting for final wire material delivery, and the supercharging stations should be available for public use by August 1, 2022. Airport Updates A contract was executed for a self-pay parking app for vehicle and transient aircraft parking at the airport, which will make all payments for transient aircraft and vehicles at the airport paperless. By reducing the need for face-to-face contact, the app reduces the spread of COVID- 19 pathogens as well as maximizes staff time. The Palo Alto Airport will be the first general aviation airport in the country to implement an app -based payment system for transient aircraft in the Country. Airport staff implemented an aviation account management system for all tenants to view their account balances, communicate with Airport staff, and submit maintenance requests. Testing and staff training begins the first week of August. Office of Transportation (OOT) Safe Routes to School (SRTS) Following last year’s successful elementary school event, the Office of Transportation Safe Routes team coordinated an Adaptive Cycling event for Palo Alto Unified School District (PAUSD) Exceptional Needs secondary school students at Palo Alto High School on June 28. In total, 13 middle school, 6 high school and 3 post-secondary students attended this year’s event. Bay Area Outreach and Recreation Program (BORP) staff fitted each student with adaptive road bikes customized for youth with various physical abilities at the Paly basketball courts. Adaptive cycling is one way the Safe Routes staff incorporates equity for all students into its programs. SRTS staff wrapped up a successful Mobile Information Kiosk E-bike program, providing active transportation outreach to the community at City parks, community events, and public schools. 11 Packet Pg. 178 City of Palo Alto Page 12 This activity was supported via Measure B Bicycle and Pedestrian funds, and staff are preparing the final report for VTA. SRTS staff also prepared materials, updated Walk and Roll Maps, and streamlined processes in advance of the busy fall season, including creating Zero Waste Bike Rodeos, scheduling Back to School events at all secondary schools, and contracting with partners on fall educational programming. South Palo Alto Bikeways Grant Applications Staff applied for two grants for the South Palo Alto Bikeways project. Construction phase funding was requested from the Active Transportation Program and from the One Bay Area Grant Program. Grant notification will occur by February 2023. Churchill Avenue Enhanced Bikeways Project Design consultants are currently working to develop 95% improvement plans for the Churchill Avenue Enhanced Bikeways Project. Next steps include finalizing design plans and submitting the project to Caltrans for obtaining encroachment permit application for work in State of California Right-of-way at El Camino and Churchill Intersection. Churchill Avenue/Alma Street Railroad Crossing Safety Improvements Work continues towards developing final improvement plans and bidding documents for the Churchill Avenue/Alma Street Railroad Crossing Safety Improvements project. Staff received and incorporated California Public Utilities Commission (CPUC) comments and changes were submitted for Final Approval from CPUC. Staff is working with Caltrain’s Joint Powers Board (JPB) to execute a Service Agreement & Construction and Maintenance Agreement to perform work in JPB Right-of-Way. Alma Street/Meadow Road Intersection Repair and Improvements Staff finalized, began, and completed construction of repairs and pedestrian refuge improvements for the north-east corner of the signalized intersection. San Antonio & Charleston Intersection Improvements Staff is working towards completion of the 95% design plans for the intersection improvements that includes traffic signal modification at the San Antonio and Charleston. Potholing was recently conducted at the intersection to determine traffic signal pole locations and to determine any potential conflicts for the installation of signal pole foundations. Quiet Zone Study at Palo Alto Avenue Staff is initiating a study in collaboration with the City of Menlo Park to review the Palo Alto Avenue railroad crossing for quiet zone implementation. Kimley Horn & Associates was selected 11 Packet Pg. 179 City of Palo Alto Page 13 as consultant to provide support to both cities in performing this study in accordance with Federal Rail Administration guidelines and requirements. Rail Grade Separation Project (Churchill Avenue, Meadow Drive, and Charleston Road) Staff are reaching out to PAUSD, PABAC, Stanford and local designers for refinements to the partial underpass alternative and other alternatives. Parking Updates Staff have been working on improving the permit order process as parking programs transition to offering virtual permit purchasing and issuing options. College Terrace Residential Preferential Parking permit renewal sales will begin online August 1, 2022, with current permits expiring at the end of August. Crescent Park No Overnight Parking permit renewal sales begin September 1, 2022, with current permits expiring at the end of September. California Avenue Parking District permit sales begin in September with vendor Duncan Solutions for permits valid during the final quarter of 2022. Parking and City Managers Office staff continue to improve the parking web pages to increase customer service and ensure they are streamlined, user-friendly, and service oriented. Grant Administration Staff submitted the necessary paperwork to receive grant funds for several grants such as Measure B: Bike/Ped Grant where the City will receive $60,000; Section 130 Grant to support the Churchill Avenue/Alma Street Railroad Crossing Safety Improvements project where City will receive $74,164; Measure B: Local Streets & Roads Grant to support local streets and roads programs where the City will receive $64,667. Ongoing Work Transportation Planning staff have been conducting development reviews, fulfilling bicycle parking requests, and providing continued support for cross-departmental initiatives, including the PAUSD relocation of Palo Verde Elementary to Greendell School, review of the County’s Stanford Community Plan Update, S/CAP Implementation Planning, Permanent Parklet Program guidelines, and Uplift Local coordination. Staff is also working in close coordination Public Works related to on-going projects such as the Charleston/Arastradero Corridor Phase 3, which has completed new paving, islands, and roadway delineation on Charleston Road between Middlefield Road and San Antonio Road. Utilities Department Drought Update California’s drought continues and State and local water use restrictions are in place in addition to Palo Alto’s permanent water waste regulations. New restrictions prohibit irrigating ornamental landscapes with potable water (drinking water) more than two days per week and between 10 a.m. to 6 p.m. Some exceptions apply for trees and perennial (non -turf) plants such as edible gardens or landscapes that are functional as well as aesthetic. At non-residential sites, 11 Packet Pg. 180 City of Palo Alto Page 14 functional turf (e.g., playing fields and golf courses) is exempt from these limits and non - functional turf cannot be irrigated at all, except to protect trees and perennial plants, or to address an immediate health and safety need. Additional water use restrictions include use of a hose without a nozzle or shut-off device and washing hardscapes except for health and safety reasons. In Palo Alto, restaurants are required to provide water only upon request and hotels and motels must provide guests with the option to opt-out of daily laundry services. Staff are collaborating with regional partners, such as Valley Water, BAWSCA, and Canopy, on outreach campaigns to share resources that help consumers conserve water while protecting the health of valuable landscapes and our urban canopy. Details, including designated watering days, are provided at cityofpaloalto.org/water. Fiber-to-the-Premises (FTTP) Update On June 23, 2022, the City launched the internet services market research survey and Palo Alto Fiber deposit program. This survey is designed to learn more about internet preferences and service needs for the community. The responses will provide guidance to the City Council for decision making on services such as pricing and speed and to help determine next steps for the Palo Alto Fiber project. The new deposit program is one measure of many to gauge community support for the Palo Alto Fiber internet services effort. By submitting a $50 deposit for the Palo Alto Fiber effort, residents and businesses have the ability to demonstrate strong support to obtain locally controlled fiber internet services. As of July 28, the City received 3,281 completed survey responses and 694 deposits. The survey will be available tentatively through August to gather as many responses as possible. The City Council and Utilities Advisory Commission will host a joint study session on September 19, 2022 to review the survey results and FTTP financial models. Sustainability and Climate Action Plan Progress Staff continues to move forward efforts focused on the Sustainability and Climate Acton Plan (S/CAP) Update, including assessing and developing potential program options to spur heat pump water heater adoption. Program evaluation will consider issues related to grid impacts and permitting. Staff anticipate bringing program recommendations to Council in late September for consideration. Staff are also making progress on other key priorities including the Sea Level Rise Vulnerability Assessment, implementing the updated tree ordinance, and supporting outreach during the drought. Business Electrification Technical Assistance Program The City will soon launch a new Business Electrification Technical Assistance Program. This program will offer free consultation and on-site assessment to all businesses to identify beneficial building electrification opportunities. Through work with the contractor, CLEAResult, the City will support the business’ electrification journey with contractor and equipment selection, and assistance with building permits and utility rebate applications. Staff anticipate a program rollout in August. Page Mill Pastures 11 Packet Pg. 181 City of Palo Alto Page 15 Earlier this year, City staff began investigating the equestrian facility Page Mill Pastures for possible use of water, unmetered and unpaid for, from a City fire hydrant. The City requires that water use from hydrants be metered and paid for just like any other utility servic e. The City does not have record of Palo Alto Pastures renting a hydrant meter from the City or paying for water usage from a hydrant. Staff have been attempting to work with the property manager to address and resolve the situation. Palo Alto Pastures rents the land from Stanford, so staff have engaged Stanford real estate to assist in the efforts to resolve the situation. Investigation is ongoing and staff will keep the City Council apprised of the outcome. Update on Engineering and Operations Projects Electric Engineering is continuing to underground utilities in the Foothills to reduce fire risk. The Grid Modernization and Electrification study is in progress and is on track for completion in fall 2022. Advanced planning is occurring for expected rotation outage blocks in late summer due to systemwide shortages caused by the lack of reliable energy sources when renewables become unavailable. The Corte Madera Water Reservoir was replaced in April 2022. Staff will complete Phase 3 of the Cross Bore Inspection Project by March 2023, which is a critical safety program administered to ensure that there is no potential cross connection of natural gas pipelines or other utility within sewer laterals. Outage Management System (OMS) The City’s current electric outage management system, National Information Solutions Cooperative, Inc (NISC), was purchased in 2011. The system, which has not been upgraded, no longer meets staff and customer needs for quick and efficient outage updates. The City received two responses to an RFP and upon evaluation, a contract with Milsoft Solutions, Inc. is being recommended to Council at the September 12, 2022 meeting. Once implemented, the new OMS will substantially improve Utilities’ ability to notify customers and mobilize resources in response to electric outages and emergencies. STAKEHOLDER ENGAGEMENT Citywide Communications During recess, the City Manager’s Office Communications Office drafted and/or coordinated important updates to keep the community aware of—and encourage engagement in—City initiatives, such as: Blog Posts on Medium • June 23, 2022 – Water Conservation Tips and New Drought Updates • July 1, 2022 – New City Budget Focuses on Fiscal Sustainability, Community Recovery & Near-Term Restoration of Services 11 Packet Pg. 182 City of Palo Alto Page 16 •July 6, 2022 – Palo Alto Race & Equity Priorities: Progress Update •July 14, 2022 – Palo Alto Fiber Blog Series: What’s New & What’s Next! News Articles Posted to the City Website •June 13, 2022 – Human Relations Commission Recruitment Now Open! •June 27, 2022 – Water Conservation & Drought Updates •June 29, 2022 – Internet/Broadband Services Market Research Survey and Deposit Program •July 1, 2022 – Fiscal Year 2023 City Budget Summary Blog •July 6, 2022 – Flags Flown at Half-Staff in Honor of Highland Park Tragedy Victims News Releases •June 28, 2022 – County Fire Agencies Warn Community of the Extreme Danger of Fireworks •July 26, 2022 – City Manager Selects Andrew Binder as Palo Alto Chief of Police ENVIRONMENTAL REVIEW This report is not subject to environmental review. 11 Packet Pg. 183 7/28/2022 Schedule of Meetings Published July 28, 2022 This is a courtesy notice only. Meeting dates, times, and locations are subject to change. Almost all Palo Alto Council and some Standing Committee meetings are cablecast live on Channel 26. If there happens to be concurrent meetings, one meeting will be broadcast on Channel 29. Meetings are held in-person and by virtual teleconference. MONDAY, August 1 Sp. City Council Meeting, 5:00 p.m. TUESDAY, August 2 Sp. Finance Committee Meeting, Cancelled WEDNESDAY, August 3 Sp. Utilities Advisory Committee Meeting, 6:00 p.m. THURSDAY, August 4 Architectural Review Board Meeting, 8:30 a.m. MONDAY, August 8 Sp. City Council Meeting, 5:00 p.m. TUESDAY, August 9 Rail Committee Meeting, 6:00 PM Policy & Services Committee Meeting, Cancelled WEDNESDAY, August 10 Sp. City Council Closed Session Meeting, 1:00 p.m. Planning & Transportation Commission Meeting, 6:00 p.m. THURSDAY, August 11 Historic Resources Board Meeting, 8:30 a.m. Stormwater Management Oversight Committee, 1:00 p.m. MONDAY, August 15 Sp. City Council Meeting, 5:00 p.m. TUESDAY, August 16 Finance Committee Meeting, 5:30 p.m. THURSDAY, August 18 City/School Liaison Committee Meeting, 8:30 a.m. Architectural Review Board Meeting, 8:30 a.m. Public Art Commission Meeting, 7:00 p.m. MONDAY, August 22 Sp. City Council Meeting, 5:00 p.m. Persons with disabilities who require auxiliary aids or services in using City facilities or programs, or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact: ADA Coordinator, City of Palo Alto, 650-329-2550 (voice) or 329-1199 (TDD), ada@cityofpaloalto.org. Listening assistive devices are available in the Council Chambers. Sign language interpreters will be provided upon request with 72 hours advance notice. Please advise the City Clerk's Office (650-329-2571) of meetings or changes by 3:00 p.m. on Wednesdays for inclusion in the following week’s schedule. a Packet Pg. 184 - Canceled City of Palo Alto (ID # 14654) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Special Orders of the Day City of Palo Alto Page 1 Title: Sibling City Update from Mayor John Hamilton, Bloomington, Indiana From: City Manager Lead Department: City Clerk There is no report for this item. A verbal presentation will be made at the meeting. Packet Pg. 185 AA1 City of Palo Alto (ID # 14639) City Council Staff Report Meeting Date: 8/8/2022 Report Type: Action Items City of Palo Alto Page 1 Title: Adoption of Resolutions: (1) Placing a Business Tax on the November 2022 Ballot; (2) Placing a Measure Affirming the Natural Gas Utility Transfer on the November 2022 Ballot; and (3) Establishing Advisory Spending Guidelines for Business Tax Proceed s From: City Manager Lead Department: Administrative Services RECOMMENDATION Staff recommends that the City Council: 1.Adopt one of the two attached Resolutions to submit a measure to the voters at the general municipal election on November 8, 2022, to adopt a business tax – either Attachment A reflecting Council’s August 1st direction, or Attachment B, reflecting an alternative measure proposed by the Ad Hoc Committee; 2.Adopt the attached revised Resolution establishing advisory spending guidelines regarding use of business tax proceeds if passed by voters (Attachment C); and 3.Adopt the attached Resolution to submit a measure to the voters at the general municipal election on November 8, 2022, to affirm the natural gas utility transfer (Attachment D). BACKGROUND The Palo Alto City Council places a high value on fiscal sustainability and has worked diligently with City staff to put the City on strong fiscal footing into the future. The Fiscal Sustainability Workplan of 2019 (CMR 10267) outlines a number of City initiatives, including proactive funding contributions for the city’s long-term liabilities for both pension and Other Post-Employment Benefits (OPEB) which have already been implemented and strategies to structurally balance the General Fund’s revenue and expenditures on an ongoing basis. The two revenue measures before Council are important elements in continuing progress towards long term sustainable budgets that meet the public’s evolving needs. A summary of the City’s work on revenue generating ballot measures can be found in CMR 13983, Attachment G. The City Council met on June 20 and directed staff to return on August 1 st with final documents to place the business tax measure on the November 2022 ballot. Packet Pg. 186 AA2 City of Palo Alto Page 2 The Council established an ad hoc committee to be appointed by the Mayor to continue discussions with the business community on the tax structure. The ad hoc committee, consisting of Mayor Burt and Councilmembers Filseth and Dubois, met with representatives of the business community multiple times prior to and subsequent to the June 20 Council meeting as well as the August 1 City Council meeting. Staff returned to the City Council on August 1, 2022 (CMR 14540) with draft language for 1) a business tax structured as a) Council directed on June 20, 2022 and b) a recommended alternative by the ad hoc committee, 2) a measure to affirm the natural gas general fund transfer for the November 2022 election, and 3) a resolution to establishing advisory spending guidelines for the use of business tax proceeds. The ad hoc committee August 1st alternative tax structure raised the square footage exemption from 5,000 square feet to 10,000 square feet and adjusted the monthly tax rate from $0.06 and $0.12 cents per square foot (depending on size) to a monthly rate of $0.10 per square foot for all non-exempt businesses above 10,000 square feet recognizing feedback from discussions with the business community. The City Council directed staff to bring forth final documents to place a business tax on the November 2022 election and a resolution to establish advisory spending guidelines for use of business tax proceeds on the August 8, 2022 Consent Calendar pending any additional revisions through final discussions with the business community: 1.Revise business tax structure based on the alternative tax structure proposal of the ad hoc (CMR 14540, Attachment B) committee that adjusts the monthly rate to $0.11 per square foot (Attachment A); 2.Revise the resolutions to establish advisory spending guidelines to assume that the measure to affirm the natural gas general fund transfer not be placed on the November 2022 ballot (Attachment C). In addition, the City Council directed staff to return to Council with a measure to affirm the natural gas general fund transfer. DISCUSSION Measure Adopting a Business Tax. Unlike most communities in California, Palo Alto does not require local businesses to contribute to city services and programs through a business tax. Prior to the COVID-19 pandemic, the Council discussed adding a business tax to enhance the City’s long-term fiscal sustainability and to help meet significant emerging public needs, particularly with respect to rail grade separations and affordable housing. The Council considered various business tax models. On March 23, 2020, in response to the COVID-19 public health emergency and sharp economic contraction, the City Council directed Packet Pg. 187 AA2 City of Palo Alto Page 3 staff to suspend work on the development of a local business tax measure for November 2020. In August 2021 (CMR 12381), Council directed City staff to resume this work and designated the Finance Committee as the working body to review and make recommendations on a potential business tax for the November 2022 election. Taken together, over four years the Committee and City Council have met a total of 24 times to discuss the most appropriate manner of structuring a potential business tax, including refinement of the tax structure for fairness and equity, advisory spending guidelines for revenues, constituent surveys, and community and stakeholder engagement. Final Tax Proposals There are two proposed tax structures before the City Council as well as information regarding the discussions and proposal from the business community as submitted to the City Council ad hoc committee. City Council August 1st Direction: The Council directed staff to revise the ad hoc committee’s business tax structure to adjust the monthly rate to $0.11 per square foot rate and return with final documents on August 8 th. As a result of this change, the estimated revenue that would be generated by the tax would be approximately $17 million. That measure is before Council in Attachment A. Ad hoc Committee Alternative: After discussion on Wednesday and Thursday (August 3rd and 4th), the Ad Hoc Committee recommends the revised tax in Attachment B for voter consideration. A follow-up discussion with business representatives was held on Wednesday, August 3 rd with minor administrative revisions proposed. On Thursday afternoon, August 4th, staff received from business representatives their final proposal to not actively oppose a tax structure; no meeting was held for further discussion. The business representatives’ proposal included the following terms: •Monthly tax rate of $0.06/sq ft •Exemption for the first 10,000 square feet •$500,000 annual cap per business (fixed, no future adjustment for inflation) •Before and after spending reports on affordable housing, public safety, and transportation (the three areas identified as intended uses of tax proceeds). Staff estimated that this proposal would generate approximately $5 million in annual revenue. The ad hoc committee discussed this proposal and recommends that the City Council adopt the following tax structure: •Monthly tax rate of $0.11/sq ft o NEW: A provision for a $1 million cap on annual tax liability per business (adjusted annually by CPI) •Square footage exemption for the first 10,000 square feet (in alignment with August 1 Council direction and proposal from the business coalition) Packet Pg. 188 AA2 City of Palo Alto Page 4 •Additional administrative clean-up provisions in response to feedback from the business community, additional detail below. This ad hoc committee recommended alternative would generate estimated tax reve nues of $16.5 million annually. Should the Council wish to place the modified tax structure that includes the $1 million business tax cap on the ballot for voter consideration, the Council would need to adopt the documents in Attachment B. The ordinance in Attachment B includes the input from business representatives received by the City on August 3rd described below. Additional administrative adjustments. On Wednesday, August 3rd, business representatives suggested a number of changes to the ordinance. St aff agrees that some of the recommendations are reasonable and appropriate and have incorporated these changes into the ad hoc committee proposal at Attachment B. The changes are: •In section 2.37.100, clarify that the Tax Administrator’s request for additional information be limited to information reasonably required to administer the tax. •Increase the time for lodging objections, filing appeals, requesting and setting hearings, and seeking a refund. Changes were made to section 2.37.150(b) and (c); section 1.27.160(a) and (b); 2.37.170(a) and (c); and section 2.37.190(c). •Decrease the time for the Tax Administrator to initiate audits. Changes were made to section 2.37.200(c), (d) and (e). Further, business representatives asked that the City report the a mount of tax generated each year and where it was spent. The City’s regular fiscal reporting and budgeting procedures include detailed annual information on anticipated and actual revenues by source, and the City’s budget, audited financials, and fiscal year close-out report include detailed information on anticipated and actual expenditures. Staff will ensure that information on business tax proceeds is clearly reflected in these documents as has been maintained as part of the reporting for recent increases in the transient occupancy tax rate. Business representatives also inquired about audit procedures. In regulations that will be forthcoming, the Tax Administrator will describe steps and timelines for standard audits, so that businesses will be informed about the process. The City will maintain flexibility to adjust to circumstances outside of its control, such as an auditee who requires extended time to assemble and transmit needed records. Measure Affirming the Natural Gas Utility Transfer. Palo Alto is fortunate to own and operate its own utilities. In 1950, Palo Alto voters approved a Charter provision authorizing the use of some utility rate revenues for City services. This was a common practice. California cities that started publicly-owned utilities in the post-war era typically set rates at reasonable levels and used some of the proceeds to fund city services. Over the ensuing decades, Palo Alto’s natural gas and electric utilities have transferred funds each year into the City’s general fund, providing a stable revenue source that supports a range of City services and community priorities, Packet Pg. 189 AA2 City of Palo Alto Page 5 including police protection, fire and emergency medical services, 911 response, parks, and roads. In 2010, Californians adopted Proposition 26, which added n ew rules on how cities may set rates and charges for services, and how they may use the funds collected. The new law did not directly address utility rate transfers, and most California cities with public utilities continued their historic transfer practice. Since 2010, however, a series of court decisions raised questions about the transfers, and in 2015, a class action lawsuit, Green v. City of Palo Alto, was filed that claimed Palo Alto’s natural gas and electric transfers are unlawful under Proposition 26. In 2021, the Santa Clara Superior court held that the electric transfer is lawful and may continue. The court also held, however, that a portion of the natural gas transfer is a tax that requires voter approval to continue. Both sides have appealed. City leaders believe it is prudent to seek voter affirmation of the City’s long-standing practice of transferring some natural gas revenues into the general fund to maintain City services that are valued by the community. Voter affirmation of the City’s existing transfer practice will continue Palo Alto’s longstanding natural gas rate-setting practice and will not be the cause of a rate increase. The City’s current natural gas utility rates for residential customers remain below comparators such as PG&E. Additional information on gas rate comparisons can be found in the FY 2023 Gas Utility Financial Plan. Consistent with responsible fiscal stewardship, the City has been reserving funds so that money is available to issue refunds to natural gas ratepayers at the appropriate time. Last year, the City cut services, in part due to the COVID-related economic contraction and in part due to setting aside the transfer funds instead of spending the funds on services as has been the practice for decades. Service cuts included firefighters, police officers, and librarians. Next year, the City will use one-time funds ($4 million) to partially restore services but if the existing transfer practice is not reaffirmed by the voters or other revenues, not currently assumed in the City’s Long Range Financial Forecast, are not identified to support restored services , ongoing service reductions will likely be required. TIMELINE The Santa Clara County Registrar of Voters (ROV) requires measure resolutions be submitted no later than August 12, 2022. RESOURCE IMPACT Ballot Measure Placement Resource Impact The ROV estimates that placing two measures on the November 2022 election ballot will cost approximately $172,000, or $86,000 each. Total costs for the November 2022 election, including Councilmember elections, is estimated at $333,000. Appropriation for these funds is included in the FY 2023 Adopted Budget at the prior estimate of $320,000. Ballot Measure Revenue Generation Resource Impact Packet Pg. 190 AA2 City of Palo Alto Page 6 The local revenue generated by a potential ballot measure will be directly impacted by the structure and rates approved by the City Council as noted earlier in this report and each of the ballot questions that would be placed before the voters. STAKEHOLDER ENGAGEMENT Feedback was solicited from the community and stakeholders in the form of an online and mail - in communitywide survey (433 respondents), six focus group sessions, a community listening session, city newsletter and blog posts, utility bill inserts, and three voter surveys. A landing page on the City’s website titled, Fiscal Sustainability: A Community Conversation, was also developed. Over the last week, City officials continued to actively engage with members of the business community who have articulated concerns, as described above. ENVIRONMENTAL REVIEW This activity is not a project under the California Environmental Quality Act (CEQA) as defined in CEQA Guidelines, Section 15378, because it has no potential for resulting in either a direct or reasonably foreseeable indirect physical change in the environment. .. Attachments: •Attachmenta: Attachment A: Resolution Placing a Business Tax on November 2022 Ballot Aug 1 Council Direction •Attachmentb: Attachment B: Resolution Placing a Business Tax on November 2022 Ballot Ad Hoc Proposed Alternative •Attachmentc: Attachment C: Resolution Regarding Business Tax Advisory Spending Guidelines Aug 1 Council Direction •Attachmentd: Attachment D: Resolution Placing Natural Gas Utility Transfer on November 2022 Ballot Aug 1 Council Direction Packet Pg. 191 AA2 NOT YET APPROVED 1 Resolution No. ______ Resolution of the Council of the City of Palo Alto Calling an Election for November 8, 2022 for Submittal to the Qualified Electors of the City a Measure Amending Title 2 of the Municipal Code to Add Chapter 2.37 to Establish a Tax on Businesses Operating in the City of Palo Alto R E C I T A L S A.Unlike most communities in California, the City of Palo Alto does not require local businesses to contribute to city services through a local business tax. As Palo Alto looks to the future, City leaders have determined that the time has come to seek voter approval to tax mid- sized and large businesses operating in the City, so that the business sector does its part to help the City to meet evolving challenges, including the need for long term stable funding for public safety services and the need for significant investments in affordable housing and grade separated train crossings that maintain mobility for vehicles, bicyclists, and pedestrians. B.A proposed ordinance attached hereto and incorporated herein by reference as Attachment “A” (the “Ordinance”) would amend the Palo Alto Municipal Code to add Chapter 2.37 to Title 2, to establish a general tax on businesses operating in the City of Palo Alto that would be imposed at a monthly rate for each square foot occupied by a business in the city, with no tax imposed on the first 10,000 square feet occupied by a business in the city, and a tax of eleven cents for each square foot occupied by a business in the city above 10,000 square feet. The tax would be imposed at half the rate for the first two years. Annual adjustments would be made for inflation, limited to 5%. Grocery stores would be exempt, and offsets would be made for businesses that remit transient occupancy tax and for payers of discretionary sales and use tax. The business tax would terminate in thirty-five years. C.Proceeds from the tax would be placed in the general fund for general governmental purposes. The City Council has approved advisory spending guidelines after considering input from residents and stakeholders on City spending priorities. D. By its Resolution No. 10045 the City Council called a general municipal election for November 8, 2022 (“Election”). E.Pursuant to Government Code Section 53724 and Election Code Section 9222, the City Council desires to submit the Ordinance to the voters of the City. The City Council of the City of Palo Alto RESOLVES as follows: SECTION 1. Findings. The City Council finds and determines that each of the findings set forth above are true and correct. SECTION 2. General Tax Election. The City Council proposes to impose the general tax set forth in the Ordinance and to present this proposal to the voters on November 8, 2022. ATTACHMENT A a Packet Pg. 192 AA2 NOT YET APPROVED 2 SECTION 3. Measure. Pursuant to Elections Code Section 9222, the City Council hereby submits the Ordinance to the voters at the Election and orders the following question to be submitted to the voters at the Election: Shall the measure to raise funds for public safety, affordable housing, rail crossing safety, homeless services, and general city services, by levying a tax on businesses in the City of Palo Alto at a monthly rate of 11 cents per square foot occupied by a business, with annual inflation adjustments (limited to 5%) and exemptions for grocery stores and businesses under 10,000 square feet, raising approximately $17 million annually for 35 years, be adopted? YES NO This question requires the approval of a majority of those casting votes. SECTION 4. Adoption of Measure. The measure to be submitted to the voters is attached to this Resolution as Exhibit A and incorporated herein by this reference. SECTION 5. Notice of Election. Notice of the time and place of holding the election is hereby given, and the City Clerk is authorized, instructed and directed to give further or additional notice of the election, in time, form and manner as required by law. SECTION 6. Impartial Analysis. Pursuant to California Elections Code Section 9280, the City Council hereby directs the City Clerk to transmit a copy of the measure to the City Attorney. The City Attorney shall prepare an impartial analysis of the measure, not to exceed 500 words in length, showing the effect of the measure on the existing law and the operation of the measure, and transmit such impartial analysis to the City Clerk on or before August 23, 2022. SECTION 7. Ballot Arguments. Pursuant to Elections Code Section 9286 et. seq., August 16, 2022 at 5:00 p.m. shall be the deadline for submission of arguments in favor of, and arguments against, any local measures on the ballot. If more than one argument for and/or against is received, the priorities established by Elections Code Section 9287 shall control. SECTION 8. Rebuttal Arguments. The provisions of Elections Code Section 9285 shall control the submission of any rebuttal arguments. The deadline for filing rebuttal arguments shall be August 23, 2022 at 5:00 p.m. SECTION 9. Consolidation Request. The Council of the City of Palo Alto requests the governing body of any other political subdivision, or any officers otherwise authorized by law, to partially or completely consolidate such elections and the City Council consents to such consolidation. The Council requests the Board of Supervisors of Santa Clara County to include on the ballots and sample ballots, all qualified measures submitted by the City Council to be ratified by the qualified electors of the City of Palo Alto. The Council acknowledges that the election will a Packet Pg. 193 AA2 NOT YET APPROVED 3 be held and conducted according to procedures in the Elections Code, including Section 10418. SECTION 10. Request for County Services. Pursuant to Section 10002 of the California Elections Code, the Council of the City of Palo Alto hereby requests the Board of Supervisors of Santa Clara County to permit the Registrar of Voters to render services to the City of Palo Alto relating to the conduct of Palo Alto’s General Municipal and Special Elections which are called to be held on Tuesday, November 8, 2022. The services shall be of the type normally performed by the Registrar of Voters in assisting the clerks of municipalities in the conduct of elections including, but not limited to, checking registrations, mailing ballots, hiring election officers and arranging for polling places, receiving absentee voter ballot applications, mailing and receiving absent voter ballots and opening and counting same, providing and distributing election supplies, and furnishing voting machines. SECTION 11. Transmittal of Resolution. The City Clerk is hereby directed to submit forthwith a certified copy of this resolution to the Santa Clara County Board of Supervisors and to the Registrar of Voters. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSENTIONS: ATTEST: APPROVED: _____________________________ ______________________________ City Clerk Mayor ______________________________ APPROVED AS TO FORM: City Manager _____________________________ ______________________________ City Attorney Director of Administrative Services a Packet Pg. 194 AA2 NOT YET APPROVED 4 Exhibit A Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Amending Title 2 of the Municipal Code to Add Chapter 2.37 to Establish a Tax on Businesses Operating in the City of Palo Alto The People of the City of Palo Alto do ordain as follows: SECTION 1. Title 2 (Administrative Code) of the Palo Alto Municipal Code is hereby amended by adding Chapter 2.37 (Business Tax) as follows: Chapter 2.37 BUSINESS TAX 2.37.010 Title This chapter is the “City of Palo Alto Business Tax Ordinance.” 2.37.020 Definitions The definitions in this section apply to the words and phrases used in this chapter unless the context clearly indicates otherwise. (a)“Business” means any commercial enterprise, trade, calling, art, vocation, profession, occupation, or means of livelihood, whether or not carried on for gain or profit. (b)“Business operator” means a person who transacts, maintains, manages, operates, controls, engages in, conducts, carries on, or owns a business in the city. It does not include the employee of a business who is not an owner or proprietor of the business. (c)“Calendar year” means the year beginning January 1 and ending December 31. (d)“City” means the City of Palo Alto. (e)“CPI Index” means the Consumer Price Index—All Urban Consumers for All Items for the San Francisco-Oakland-Hayward Area or any successor to that index designated by the Federal Bureau of Labor Statistics or the city council. (f)“Fiscal year” means the year beginning July 1 and ending June 30. (g)“Fixed place of business” means a place of business located in the city boundaries and occupied for the particular purpose of operating a business. a Packet Pg. 195 AA2 NOT YET APPROVED 5 (h)“Grocery store” means a business that exists for the primary purpose of selling a range of food items to consumers for consumption off site, such as canned foods; dry goods; fresh produce; fresh meats, fish, and poultry; and any area that is not separately owned within the store where food is prepared and served, including a bakery, deli, and meat and seafood departments, or as otherwise defined in 14 CCR section 18982(a)(3), provided that any store that combines grocery items with other retail products or services is a grocery store for the purpose of this chapter only if two-thirds or more of the occupied space is designated to the sale of grocery items as listed in this section. (i)“Hotel” has the meaning provided in section 2.33.010. (j)“Operate” means to conduct a business and includes all stages of conducting a business from initial planning to the wind-down of a business, whether or not a profit is being made. (k)“Person” means any individual, firm, partnership, joint venture, association, corporation, limited liability company, estate, trust, receiver, syndicate or other group or combination acting as a unit and includes the plural as well as the singular number. (l)“Quarter” means the three-month quarter of the fiscal year. The “first quarter” is the months of July, August, and September; the “second quarter” is the months of October, November, and December; the “third quarter” is the months of January, February, and March; and the “fourth quarter” is the months of April, May, and June. The term “same quarter of the previous fiscal year” means the quarter of the same number in the previous fiscal year. (m)“Square footage” means the rentable square footage used by a business as specified in a business’s lease or, if the business floor space is owned by the business, as calculated in the same manner as if the area was rented using commonly accepted standards of measurement for leasing purposes such as the Standard Methods of Measurement published by the Building Owners and Managers Association (BOMA). Any method of measurement used must meet the following minimum standards: (1)It shall be computed by measuring to the inside finish of permanent outer building walls and shall include space used by columns and projections necessary to the building. (2)It shall include both the area used by the business and a proportionate share of the building service areas such as lobbies, corridors and other common areas in a building unless assigned to another business for tax calculation purposes. (3)It shall not include vertical penetrations through the building such as stairs, elevators, or heating, ventilation, air conditioning, utility, or telephone systems, except on the lowest floor of stairs and elevators. a Packet Pg. 196 AA2 NOT YET APPROVED 6 (4)For the business of renting or leasing property, it shall include area used primarily for the business operator’s offices and operational facilities. (5)It shall not include residential uses, including multiple-family use as defined in section 18.04.030(102), two-family use as defined in section 18.04.030(141), single-family residential use as defined in section 18.04.030(86)(A)), mobile home park as defined in section18.04.030(97), residential care homes as defined in section 18.04.030(124), supportive housing as defined in section 18.04.030(135.5), transitional housing as defined in section 18.04.030(138), emergency shelter as defined in section 18.04.030(50), and any equivalent residential use defined by the city. (6)It shall include hotel as defined in section 18.04.030(73). (7)Square footage for businesses with multiple locations will be measured and tax assessed will be calculated based on the aggregate square footage for the business for all locations in the city. (n)“Tax Administrator” means the Director of Administrative Services, or successor position, or their designee. (o)“Transient Occupancy Tax” means the tax imposed under section 2.33.020. (p)“Transitory business” means a business that operates in the city for less than 90 days in the course of one calendar year (such as seasonal sale lots, special events, concerts/performances/circuses, filming, and party rentals). (q)“Vacant” means a severable portion of the physical location that a business is occupying, such as an entire floor, a building, or a portion of a floor with independent entrance and exit, that is free from any use, fixtures, furniture, and equipment, and is immediately available for use by a new tenant or owner. 2.37.030 Obligation to Pay Business Tax (a)It is unlawful for any business operator, either for themselves or for any other person, to operate in the city any business taxed under this chapter without paying all business tax required by this chapter. (b)If a business has more than one business operator, then the payment of the business tax by one business operator excuses any other business operators from the obligation to pay the business tax for that period for which the tax has been paid. (c)The requirement to pay business tax is in addition to and separate from the requirement to obtain a business registration certificate under section 4.60.030. a Packet Pg. 197 AA2 NOT YET APPROVED 7 (d)The payment of business tax does not authorize the doing of any act which the person or business paying the business tax is not otherwise entitled to do and does not excuse the business from complying with other applicable Code requirements. 2.37.040 Imposition of Business Tax Any business operator operating a business at a fixed place of business in the city must pay a business tax at the following rates: (a)Beginning January 1, 2023, the tax shall be imposed at the following rates: (1)For the first 10,000 square feet occupied by a business in the city, no tax shall be imposed. (2)For each square foot occupied by a business in the city over 10,000 square feet, a monthly tax of five and one-half (5.5) cents per square foot shall be imposed. (b)Beginning January 1, 2025, the tax shall be imposed at the following rates: (1)For the first 10,000 square feet occupied by a business in the city, no tax shall be imposed. (2)For each square foot occupied by a business in the city over 10,000 square feet, a monthly tax of eleven (11) cents per square foot shall be imposed. 2.37.050 Annual CPI Adjustment of Tax Rate (a)Beginning with the 2026-27 fiscal year, and each fiscal year thereafter, the tax rates in subdivisions (b)(1) and (b)(2) of section 2.37.040 shall be automatically increased by a percentage equal to the percentage increase in the CPI Index in the previous calendar year (“the CPI Increase”). (b)Notwithstanding subdivision (a) of this section, in any year in which the CPI Increase is more than 5%, the increase in the tax rate will be limited to 5%. 2.37.060 Disposition of Tax Revenue The tax imposed by this chapter is for the purpose of raising revenue for the general governmental purposes of the city. All of the proceeds from the tax imposed by this chapter shall be placed in the city’s general fund. 2.37.070 Exemptions from Tax (a)The following businesses are exempt from the tax imposed by this chapter: a Packet Pg. 198 AA2 NOT YET APPROVED 8 (1)Any business exempt from the tax by the laws of the United States or the State of California; (2)Grocery stores; (3)Businesses that occupy or use 10,000 square feet or less in the city; and (4)Transitory businesses. (b)If a business operator operates a single integrated business that has two or more parts, one or more of which could be exempt from the tax imposed by this chapter if operated as a separate business, the city may, at its discretion, exempt from the tax any part of the business that would be exempt if operated as a separate business, provided the business’s square footage can be reasonably allocated between the parts. If the city determines that the square footage cannot be reasonably allocated between the different parts of the business, then the entire business shall be taxed, unless to do so would violate a law of the United States or the State of California. 2.37.080 Business Tax Offsets (a)A business operator that operates a hotel in the city may deduct from the business tax it owes for a quarter for the business of operating the hotel an amount equal to the total transient occupancy tax collected and remitted to the city in the same quarter of the previous fiscal year from transients staying at the hotel. (b)The business operator of a business that has discretion to determine the location of the place of sale, place of use, or principal place of negotiation for sales or use tax purposes and which exercises that discretion and designates the city as the place of sale, place of use, or principal place of negotiation for sales or use tax purposes which results in the city receiving sales or use tax revenues that it would not otherwise have received, but for the business’s exercise of its discretion to designate the city as the place of sale, place of use, or principal place of negotiation for sales or use tax purposes (“Discretionary Sales or Use Tax Sales”) may deduct from the business tax it owes for a quarter an amount equal to one half of the total sales tax or use tax received by the city from the Discretionary Sales or Use Tax Sales of that business in the same quarter of the previous fiscal year. This offset can offset up to, but no more than, 75% of the business’s quarterly business tax. The city and a business operator may enter into an agreement implementing this section. (c)A business claiming an offset under this section must claim the offset with its tax filing for the quarter for which the offset is claimed. (1)If the information necessary for a business to claim an offset is not available, the business may defer claiming an offset for up to one year or for another period of a Packet Pg. 199 AA2 NOT YET APPROVED 9 time set by written agreement with the city. (2)The Tax Administrator may require a business claiming an offset to submit additional information to support the claim of the offset. The request for additional information must be made in writing and the information must be provided within thirty (30) days. (3)If the Tax Administrator determines that an offset claimed by a business is incorrect, the Tax Administrator may make an Initial Determination of the amount, if any, of the offset and the amount of tax due under subdivision (a) of section 2.37.150. 2.37.090 Quarterly Tax Payments (a)The tax imposed by this chapter shall be paid quarterly. The tax for each quarter is due the first day of the following quarter and is delinquent thirty (30) days later. (b)For the first quarter in which a business begins operating in the city, the business’s tax shall be prorated for the number of days that the business was operating in the quarter. (c)For the last quarter in in which a business operates in the city before closing, the business’s tax shall be prorated for the number of days that the business was operating in the quarter. 2.37.100 Business Tax Filing for a New Business When a business begins operating in the city for the first time, the business operator must provide the Tax Administrator with the following information, verified by the business operator as true and correct under penalty of perjury of the laws of the State of California, before beginning the operation of the business in the city: (a)The name of the business and the address or addresses at which it will be operating in the city; (b)The date on which the business will begin operating; (c)The nature of the business’s activities; (d)The square footage in which the business will be operating in the city; and (e)Any other information required by the Tax Administrator. // // a Packet Pg. 200 AA2 NOT YET APPROVED 10 2.37.110 Quarterly Tax Returns With each quarterly tax payment, a business operator must submit a quarterly tax return which contains the following information, verified by the business operator as true and correct under penalty of perjury of the laws of the State of California: (a)The name of the business and the address or addresses at which it is operating in the city; (b)The nature of the business’s activities; (c)The square footage in which the business is operating in the city; (d)If the business operator claims an offset under section 2.37.080, sufficient information and documentation to establish the business’s right to the offset and the amount of the offset; (e)Any other information required by the Tax Administrator; and (f)The amount of tax due based on the square footage of the business. 2.37.120 Agreements for Installment Payments The Tax Administrator may enter into an agreement with a business operator to allow a business operator to pay the tax on a more or less frequent basis. 2.37.130 Businesses Operating in the Same Location (a)Each business operator operating a business in a location where one or more other businesses are also operating is obligated to pay business tax measured by the square footage occupied by that business. (b)The payment of business tax by a business operator absolves any other business operator from having to pay business tax measured by the same square footage. (c)Two or more business operators that are operating businesses in the same square footage may contractually agree which business will pay the business tax measured by that square footage. 2.37.140 Delinquent Taxes (Penalties and Interest) (a)When a tax becomes delinquent, a penalty of 10% of the amount of the delinquent tax will be added to the amount of tax due. If the tax remains unpaid sixty (60) days after becoming delinquent, an additional penalty of 25% of the amount of the delinquent tax (excluding accrued interest and the initial penalty) will be added to the amount of tax a Packet Pg. 201 AA2 NOT YET APPROVED 11 due. (b)On the first of each month that a tax is delinquent, interest in the amount of 1.5% of the delinquent amount, excluding penalties and interest, will be added to the amount of tax due. (c)A business operator may apply to the Tax Administrator for a reduction or waiver of any accrued penalties or interest, and the Tax Administrator may reduce or waive any accrued penalties or interest upon a finding of good cause. 2.37.150 Administrative Procedure to Assess or Correct Tax (a)If the Tax Administrator determines that a business operator has incorrectly reported any information to the city or has not paid all or any of the tax, penalties, or interest that are due, the Tax Administrator may, using any information available to the Tax Administrator, issue an Initial Determination stating what the Tax Administrator believes to be the correct information and, if new or additional tax, penalties, or interest are due, how much tax, penalties, or interest are due. An Initial Determination must be issued within five (5) years of the last day of the quarter to which the Initial Determination applies, except in the case of an audit conducted under section 2.37.200, in which case it must be issued within ninety (90) days of the completion of the audit and can apply to any of the quarters that were subject to the audit. The Initial Determination shall be served on the business operator either personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. Service is effective upon deposit of the Initial Determination in the U.S. Mail. (b)A business operator affected by an Initial Determination may within fifteen (15) days of service of an Initial Determination contest the Initial Determination and request a hearing before the Tax Administrator by filing with the Tax Administrator a written request for a hearing. The further accrual of penalties and interest shall be tolled upon the filing of a request for a hearing. If a business operator does not contest an Initial Determination and request a hearing with the Tax Administrator within fifteen (15) days of service of the Initial Determination, the Initial Determination shall become final and cannot be appealed. (c)If a business operator timely contests an Initial Determination and requests a hearing, the Tax Administrator shall set a hearing within thirty (30) days of the filing of the request for a hearing. Notice of the hearing shall be served on the business operator either personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. (d)At the hearing the business operator may present evidence and argument regarding the Initial Determination to show why the Initial Determination is incorrect and to show what the determination of the Tax Administrator should be. Within sixty (60) day after the close of the hearing, the Tax Administrator shall serve a Final Determination, setting a Packet Pg. 202 AA2 NOT YET APPROVED 12 forth the Tax Administrator’s determination of the facts and issues that were the subject of the Initial Determination. The Final Determination shall be served on the business operator either personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. Service is effective upon deposit of the Final Determination in the U.S. Mail. Unless an appeal of a Final Determination is filed under section 2.37.170, any penalties or interest tolled under subdivision (b) of this section will resume accruing ten (10) days after the service of the Final Determination. 2.37.160 General Administrative Remedy (a)Any person affected by a decision of the Tax Administrator (“the challenger”), except for decisions under section 2.37.150, may challenge that decision by filing a written objection to the decision with the Tax Administrator. The objection must be filed within fifteen (15) days of the issuance of the decision being challenged. If the Tax Administrator was required to provide notice of the decision, then the time to file an objection to the decision begins to run from the date of service of the notice of the decision. The Tax Administrator shall serve a written response to the objection within thirty (30) days of the filing of the objection, which period can be extended by the Tax Administrator for an additional thirty (30) days. The Tax Administrator’s response to the objection shall be served on the challenger either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. (b)The challenger may request a hearing on the Tax Administrator’s response to the objection by filing a request for a hearing with the Tax Administrator within fifteen (15) days of service of the response to the objection. If a timely request for a hearing on a response to the objection is filed with the Tax Administrator, the Tax Administrator shall set a hearing within thirty (30) days of the filing of the request for a hearing. Notice of the hearing shall be served on the challenger either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. (c)At the hearing the challenger may present evidence and argument regarding the decision being challenged to show why the decision is incorrect and to show what it should be. Within sixty (60) days after the close of the hearing, which the Tax Administrator may extend for an additional sixty (60) days, the Tax Administrator shall serve a Final Determination on the decision, setting forth the Tax Administrator’s determination of the decision that was challenged. The Final Determination shall be served on the challenger either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. Service is effective upon deposit of the Final Determination in the U.S. mail. 2.37.170 Appeals (a)A Final Determination of the Tax Administrator under section 2.37.150, subdivision (d), or section 2.37.160, subdivision (c), can be appealed to the City Manager by filing a written notice of appeal with the City Manager within fifteen (15) days of service of the a Packet Pg. 203 AA2 NOT YET APPROVED 13 notice of the Final Determination being appealed. (b)Only a business operator who files a timely request for a hearing on an Initial Determination under section 2.37.150 and participates in the hearing or a challenger who files an objection to a decision and files a request for a hearing on the response to the objection under section 2.37.160 and participates in the hearing can file an appeal under this section. (c)If a timely appeal is filed with the City Manager, the City Manager, or the City Manager’s designee, shall set a hearing within thirty (30) days of the filing of the appeal, which may be extended by the City Manager for an additional thirty (30) days. Notice of the hearing shall be served on the appellant either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. The tolling of the accrual of penalties or interest under section 2.37.150, subdivision (b), shall continue upon the timely filing of an appeal under this section. (d)At the hearing the appellant and the Tax Administrator may present evidence and argument regarding the decision being appealed to show why the decision is correct or incorrect and to show what it should be. Within sixty (60) days after the close of the hearing, which the City Manager or the City Manager’s designee may extend for an additional sixty (60) days, the City Manager or the City Manager’s designee shall serve a written decision, setting forth the resolution of the appeal. The decision shall be served on the appellant either personally or by U.S. mail to the most recent address for the appellant in the City Manager’s records. Service is effective upon deposit of the decision in the U.S. Mail. Any penalties and interest that were tolled under section 2.37.150, subdivision (b), shall resume accruing ten (10) days after the service of the decision. (e)A decision of the City Manager, or the City Manager’s designee, served under subdivision (d) of this section is subject to judicial review under sections 1094.5 and 1094.6 of the Code of Civil Procedure with a writ petition filed in the appropriate court within ninety (90) days of the service of the written decision. Any tax, penalties, or interest determined by the decision to be owed to the city by the appellant must be paid to the city as a precondition to filing a writ petition challenging the decision, but a claim for a refund under section 2.37.190 does not have to be filed before filing a writ petition. 2.37.180 Constitutional Apportionment (a)No tax imposed by this chapter shall be applied to a business operator so as to constitute an undue burden on interstate commerce or intercity commerce or be violative of the equal protection or due process clauses of the United States or California constitutions. (b)A business operator who contends that the application of a tax imposed by this chapter on the business operator constitutes an undue burden on interstate commerce or a Packet Pg. 204 AA2 NOT YET APPROVED 14 intercity commerce or violates the equal protection or due process clauses of the United States or California constitutions may apply to the Tax Administrator for an apportionment of the tax imposed on the business operator that would remove the constitutional violation by filing a written request with the Tax Administrator that explains the factual and legal basis for the claimed constitutional violation and proposes a method of apportionment that would resolve the alleged constitutional violations. (c)The Tax Administrator, in consultation with City Attorney, shall review the application and within sixty (60) days of the filing of the application, which deadline may be extended for an additional sixty (60) days, issue a decision on the application. The decision on the application shall be served on the business operator either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. The decision can be challenged under section 2.37.160. 2.37.190 Refunds (a)A business operator who believes that any tax, penalty, or interest has been illegally, erroneously, or mistakenly paid to, collected by, or otherwise received by the city may file a claim for a refund of the amount of tax, penalty, or interest claimed to have been improperly received by the city. (b)The claim must be filed with the Tax Administrator and signed under penalty of perjury by the business operator. The claim must state: (1)The legal and factual basis for the refund claim; (2)The amount of tax, penalty, or interest allegedly improperly received by the city; (3)The date or dates that the improper payments were made to the city; and (4)The address of the claimant. (c)The claim must be filed with the Tax Administrator within one (1) year of the date of the allegedly improper payment to the city. (d)The Tax Administrator shall provide a written decision on the claim within thirty (30) days of the filing of the claim by serving the decision on the claimant either personally or by U.S. mail to the address provided in the claim. Service is effective upon deposit of the response in the U.S. Mail. (e)A claimant may challenge the Tax Administrator’s decision on a refund claim under section 2.37.160. (f)This section does not apply to: a Packet Pg. 205 AA2 NOT YET APPROVED 15 (1)A claim for a refund arising out of a decision of the Tax Administrator, City Manager, or City Manager’s designee under sections 2.37.150, 2.37.160, 2.37.170, or 2.37.190; or (2)A claim that could have been asserted by the claimant, but was not, under sections 2.37.150, 2.37.160, 2.37.170, or 2.37.190. 2.37.200 Audits (a)The Tax Administrator may conduct an audit of any business operator to ensure proper compliance with the requirements of this chapter. (b)To initiate an audit the Tax Administrator shall provide written notice to the business operator that is the subject of the audit of the initiation of the audit by serving the notice personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. The notice shall state the period of time subject to the audit. (c)Notice of the initiation of an audit for a quarter for which either a business tax filing for a new business or quarterly tax return was submitted under section 2.37.100 or section 2.37.110 must be served within five (5) years of the last day of the quarter to which the filing or return applied. (d)Notice of the initiation of an audit for a quarter for which neither a business tax filing for a new business nor a quarterly tax return was submitted under section 2.37.100 or section 2.37.110, but for which the business was registered as a business under section 4.60.030, must be served within seven (7) years of the last day of the quarter for which the filing or return should have been filed. (e)Notice of the initiation of an audit for a quarter for which neither a business tax filing for a new business nor a quarterly tax return was submitted under section 2.37.100 or section 2.37.110, and for which the business was not registered as a business under section 4.60.030, must be served within ten (10) years of the last day of the quarter for which the filing or return should have been filed. (f)Upon completion of an audit, the Tax Administrator may make an Initial Determination under subdivision (a) of section 2.37.150 of any taxes, penalties, and interest determined to be owed and not paid for the audit period. The Initial Determination must be issued within ninety (90) days of the completion of the audit. If a business operator subject to audit is unable or unwilling to provide sufficient records to enable the Tax Administrator to verify compliance with this chapter, the Tax Administrator is authorized to make a reasonable estimate of the amount of tax due and the reasonable estimate shall be entitled to a rebuttable presumption of correctness. a Packet Pg. 206 AA2 NOT YET APPROVED 16 2.37.210 Maintenance and Review of Records (a)Business operators must maintain for six (6) years records of square footage and information necessary to calculate the tax. If the Tax Administrator serves notice of the initiation of an audit, the information pertinent for the quarters subject to the audit must be maintained until the conclusion of the audit. (b)The Tax Administrator may with reasonable notice inspect the premises and records of the business operator. (c)The Tax Administrator may request the city council to issue an administrative subpoena for records of a business operator or other persons with relevant information. 2.37.220 Confidentiality of Records All documents submitted to the city by a business operator under this chapter and all documents of a business operator inspected by the Tax Administrator in the conduct of an audit are presumed to be confidential and will not be subject to public inspection to the fullest extent allowed by law and must be maintained so that the contents of the documents will not become known except to persons charged with the administration of this chapter. Confidential documents may be shared with consultants retained by the city to aid in the administration of this chapter, provided the consultants agree to maintain the confidentiality of the documents. However, nothing in this section precludes the city from aggregating information and releasing it in a manner that does not identify any particular business or connect any information with a particular business. 2.37.230 Action to Collect Delinquent Taxes (a)Any tax, penalty, and interest imposed on a business operator under this chapter is a debt owed by the business operator to the city, which may be recovered in an action filed by the city in a court of competent jurisdiction. (b)An action under this section shall be filed within three (3) years of an Initial Determination becoming final under subdivision (b) of section 2.37.150, the issuance of a Final Determination under subdivision (d) of section 2.37.150 that is not appealed, the issuance of a Final Determination under subdivision (c) of section 2.37.160 that is not appealed, or the issuance of a decision under subdivision (d) of section 2.37.170. (c)During the pendency of an action filed under this section, interest will continue to accrue under subdivision (b) of section 2.37.140 until the entry of judgment. (d)Before filing an action, the city may serve the business operator either personally or by U.S. mail at the most recent address for the business operator in the Tax Administrator’s records with notice of the pending action and give the business operator fifteen (15) days to pay all of the delinquent taxes, penalties, and fees. If all of the of the delinquent a Packet Pg. 207 AA2 NOT YET APPROVED 17 taxes, penalties, and fees are not paid within the fifteen-day period, then an additional penalty of 25% of the amount of the delinquent tax (including accrued penalties and interest) shall be added to the total delinquency and may be recovered in the action. 2.37.240 Errors Not Binding on the City No error by the Tax Administrator or any other officer, employee, or agent of the city in the application of this chapter shall prevent, prejudice, or estop the collection by or for the city of the full amount of tax owed by any person under this chapter. 2.37.250 Dates If the last day for the performance of any act under this chapter is a Saturday, Sunday, or holiday recognized by the city, then the date for the performance of that act is extended to the next day that is not a Saturday, Sunday, or holiday recognized by the city. 2.37.260 Rules and Regulations (a)The Tax Administrator may adopt rules and regulations that are not inconsistent with the provisions of this chapter as may be necessary to aid in the application and enforcement of this chapter. (b)The Tax Administrator may adopt rules providing for the service or filing of any notices, filings, returns, or submittals required by this chapter. These rules may provide alternative means for serving or filing any notice, filing, return, or submittal, and may clarify the method of serving or filing any notice, filing, return, or submittal provided for in this chapter. 2.37.270 City Council Amendments (a)The city council may amend this chapter in any way it deems necessary without the approval of the electorate, provided the amendment does not increase the amount of tax that any person would pay. (b)Any amendment to this chapter that would reduce the amount of tax any taxpayer would pay, either temporarily or permanently, must be approved by two-thirds (2/3) of the members of the city council. (c)Notwithstanding subdivision (a) of this section, the city council may with the approval of two-thirds (2/3) of its members and without approval of the electorate reduce, revise, or eliminate any of the business tax offsets in section 2.37.080. 2.37.280 Severability If any word, phrase, sentence, part, section, subsection, or other portion of this chapter, or any application thereof to any person or circumstance is declared void, unconstitutional, or a Packet Pg. 208 AA2 NOT YET APPROVED 18 invalid for any reason, then such word, phrase, sentence, part, section, subsection, or other portion, or the prescribed application thereof, shall be severable, and the remaining provisions of this chapter, and all applications thereof, not having been declared void, unconstitutional or invalid, shall remain in full force and effect. The People of the City of Palo Alto hereby declare that they would have passed this ordinance, and each section, subsection, sentence, clause and phrase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases had been declared invalid or unconstitutional. 2.37.290 Savings Clause No section, clause, part, or provision of this chapter shall be construed as requiring the payment of any tax that would be in violation of the Constitution or laws of the United States of America or of the Constitution or laws of the State of California. 2.37.300 Sunset The tax imposed by this Chapter shall cease to be imposed on January 1, 2058. SECTION 2. Implementation Procedures 1.The new tax imposed by this ordinance will go into effect on January 1, 2023. 2.Notwithstanding sections 2.37.090, 2.37.100, and 2.37.110 of the codified part of this ordinance, the tax imposed by this ordinance will initially be due on the following schedule: (a)The initial tax payment for the tax that has accrued since January 1, 2023 will be due on January 1, 2024, or on a subsequent date established by the Tax Administrator and will be delinquent 30 days later if not paid. (b)With its initial tax payment, each business shall provide the following information: (1)The name of the business and the address or addresses at which it will be operating in the city; (2)The nature of the business’s activities; (3)The square footage in which the business will be operating in the city; (4)If the business operator claims an offset under section 2.37.080, sufficient information and documentation to establish the business’s right to the offset and the amount of the offset; (5)Any other information required by the Tax Administrator; and (6)The amount of tax due based on the square footage of the business. a Packet Pg. 209 AA2 NOT YET APPROVED 19 (c)A business that begins operating for the first time after January 1, 2023, must submit its initial tax payment and initial information by the date provided in this uncodified section or by the date provided in codified section 2.37.090, whichever is later. SECTION 3. General Tax. Proceeds of the tax imposed by this Ordinance shall be deposited in the general fund of the City and shall be available for any legal purpose. SECTION 4. Effective Date. This ordinance shall be effective only if approved by a majority of the voters and shall go into effect immediately after the vote is declared by the City Council. SECTION 5. Execution. The Mayor is hereby authorized to attest to the adoption of this Ordinance by the voters of the City by signing where indicated below. I hereby certify that the foregoing Ordinance was PASSED, APPROVED and ADOPTED by the People of the City of Palo Alto voting on the 8th day of November, 2022. ATTEST: __________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ___________________________ City Attorney City Manager ___________________________ Director of Administrative Services a Packet Pg. 210 AA2 NOT YET APPROVED 1 Resolution No. ______ Resolution of the Council of the City of Palo Alto Calling an Election for November 8, 2022 for Submittal to the Qualified Electors of the City a Measure Amending Title 2 of the Municipal Code to Add Chapter 2.37 to Establish a Tax on Businesses Operating in the City of Palo Alto R E C I T A L S A.Unlike most communities in California, the City of Palo Alto does not require local businesses to contribute to city services through a local business tax. As Palo Alto looks to the future, City leaders have determined that the time has come to seek voter approval to tax mid- sized and large businesses operating in the City, so that the business sector does its part to help the City to meet evolving challenges, including the need for long term stable funding for public safety services and the need for significant investments in affordable housing and grade separated train crossings that maintain mobility for vehicles, bicyclists, and pedestrians. B.A proposed ordinance attached hereto and incorporated herein by reference as Attachment “A” (the “Ordinance”) would amend the Palo Alto Municipal Code to add Chapter 2.37 to Title 2, to establish a general tax on businesses operating in the City of Palo Alto that would be imposed at a monthly rate for each square foot occupied by a business in the city, with no tax imposed on the first 10,000 square feet occupied by a business in the city, and a tax of eleven cents for each square foot occupied by a business in the city above 10,000 square feet. The tax would be imposed at half the rate for the first two years. Annual adjustments would be made for inflation, limited to 5%. Grocery stores would be exempt, offsets would be made for businesses that remit transient occupancy tax and for payers of discretionary sales and use tax, and total tax would be capped at $1 million per year. The business tax would terminate in thirty- five years. C.Proceeds from the tax would be placed in the general fund for general governmental purposes. The City Council has approved advisory spending guidelines after considering input from residents and stakeholders on City spending priorities. D. By its Resolution No. 10045 the City Council called a general municipal election for November 8, 2022 (“Election”). E.Pursuant to Government Code Section 53724 and Election Code Section 9222, the City Council desires to submit the Ordinance to the voters of the City. The City Council of the City of Palo Alto RESOLVES as follows: SECTION 1. Findings. The City Council finds and determines that each of the findings set forth above are true and correct. SECTION 2. General Tax Election. The City Council proposes to impose the general tax set forth in the Ordinance and to present this proposal to the voters on November 8, ATTACHMENT B b Packet Pg. 211 AA2 NOT YET APPROVED 2 2022. SECTION 3. Measure. Pursuant to Elections Code Section 9222, the City Council hereby submits the Ordinance to the voters at the Election and orders the following question to be submitted to the voters at the Election: Shall the measure to raise funds for public safety, affordable housing, rail crossing safety, homeless services, and general city services, by levying a tax on businesses in the City of Palo Alto at a monthly rate of 11 cents per square foot occupied by a business, with annual inflation adjustments (limited to 5%) and exemptions for grocery stores and businesses under 10,000 square feet, raising approximately $16.5 million annually for 35 years, be adopted? YES NO This question requires the approval of a majority of those casting votes. SECTION 4. Adoption of Measure. The measure to be submitted to the voters is attached to this Resolution as Exhibit A and incorporated herein by this reference. SECTION 5. Notice of Election. Notice of the time and place of holding the election is hereby given, and the City Clerk is authorized, instructed and directed to give further or additional notice of the election, in time, form and manner as required by law. SECTION 6. Impartial Analysis. Pursuant to California Elections Code Section 9280, the City Council hereby directs the City Clerk to transmit a copy of the measure to the City Attorney. The City Attorney shall prepare an impartial analysis of the measure, not to exceed 500 words in length, showing the effect of the measure on the existing law and the operation of the measure, and transmit such impartial analysis to the City Clerk on or before August 23, 2022. SECTION 7. Ballot Arguments. Pursuant to Elections Code Section 9286 et. seq., August 16, 2022 at 5:00 p.m. shall be the deadline for submission of arguments in favor of, and arguments against, any local measures on the ballot. If more than one argument for and/or against is received, the priorities established by Elections Code Section 9287 shall control. SECTION 8. Rebuttal Arguments. The provisions of Elections Code Section 9285 shall control the submission of any rebuttal arguments. The deadline for filing rebuttal arguments shall be August 23, 2022 at 5:00 p.m. SECTION 9. Consolidation Request. The Council of the City of Palo Alto requests the governing body of any other political subdivision, or any officers otherwise authorized by law, to partially or completely consolidate such elections and the City Council consents to such consolidation. The Council requests the Board of Supervisors of Santa Clara County to include on the ballots and sample ballots, all qualified measures submitted by the City Council to be ratified b Packet Pg. 212 AA2 NOT YET APPROVED 3 by the qualified electors of the City of Palo Alto. The Council acknowledges that the election will be held and conducted according to procedures in the Elections Code, including Section 10418. SECTION 10. Request for County Services. Pursuant to Section 10002 of the California Elections Code, the Council of the City of Palo Alto hereby requests the Board of Supervisors of Santa Clara County to permit the Registrar of Voters to render services to the City of Palo Alto relating to the conduct of Palo Alto’s General Municipal and Special Elections which are called to be held on Tuesday, November 8, 2022. The services shall be of the type normally performed by the Registrar of Voters in assisting the clerks of municipalities in the conduct of elections including, but not limited to, checking registrations, mailing ballots, hiring election officers and arranging for polling places, receiving absentee voter ballot applications, mailing and receiving absent voter ballots and opening and counting same, providing and distributing election supplies, and furnishing voting machines. SECTION 11. Transmittal of Resolution. The City Clerk is hereby directed to submit forthwith a certified copy of this resolution to the Santa Clara County Board of Supervisors and to the Registrar of Voters. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSENTIONS: ATTEST: APPROVED: _____________________________ ______________________________ City Clerk Mayor ______________________________ APPROVED AS TO FORM: City Manager _____________________________ ______________________________ City Attorney Director of Administrative Services b Packet Pg. 213 AA2 NOT YET APPROVED 4 Exhibit A Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Amending Title 2 of the Municipal Code to Add Chapter 2.37 to Establish a Tax on Businesses Operating in the City of Palo Alto The People of the City of Palo Alto do ordain as follows: SECTION 1. Title 2 (Administrative Code) of the Palo Alto Municipal Code is hereby amended by adding Chapter 2.37 (Business Tax) as follows: Chapter 2.37 BUSINESS TAX 2.37.010 Title This chapter is the “City of Palo Alto Business Tax Ordinance.” 2.37.020 Definitions The definitions in this section apply to the words and phrases used in this chapter unless the context clearly indicates otherwise. (a)“Business” means any commercial enterprise, trade, calling, art, vocation, profession, occupation, or means of livelihood, whether or not carried on for gain or profit. (b)“Business operator” means a person who transacts, maintains, manages, operates, controls, engages in, conducts, carries on, or owns a business in the city. It does not include the employee of a business who is not an owner or proprietor of the business. (c)“Calendar year” means the year beginning January 1 and ending December 31. (d)“City” means the City of Palo Alto. (e)“CPI Index” means the Consumer Price Index—All Urban Consumers for All Items for the San Francisco-Oakland-Hayward Area or any successor to that index designated by the Federal Bureau of Labor Statistics or the city council. (f)“Fiscal year” means the year beginning July 1 and ending June 30. (g)“Fixed place of business” means a place of business located in the city boundaries and occupied for the particular purpose of operating a business. b Packet Pg. 214 AA2 NOT YET APPROVED 5 (h)“Grocery store” means a business that exists for the primary purpose of selling a range of food items to consumers for consumption off site, such as canned foods; dry goods; fresh produce; fresh meats, fish, and poultry; and any area that is not separately owned within the store where food is prepared and served, including a bakery, deli, and meat and seafood departments, or as otherwise defined in 14 CCR section 18982(a)(3), provided that any store that combines grocery items with other retail products or services is a grocery store for the purpose of this chapter only if two-thirds or more of the occupied space is designated to the sale of grocery items as listed in this section. (i)“Hotel” has the meaning provided in section 2.33.010. (j)“Operate” means to conduct a business and includes all stages of conducting a business from initial planning to the wind-down of a business, whether or not a profit is being made. (k)“Person” means any individual, firm, partnership, joint venture, association, corporation, limited liability company, estate, trust, receiver, syndicate or other group or combination acting as a unit and includes the plural as well as the singular number. (l)“Quarter” means the three-month quarter of the fiscal year. The “first quarter” is the months of July, August, and September; the “second quarter” is the months of October, November, and December; the “third quarter” is the months of January, February, and March; and the “fourth quarter” is the months of April, May, and June. The term “same quarter of the previous fiscal year” means the quarter of the same number in the previous fiscal year. (m)“Square footage” means the rentable square footage used by a business as specified in a business’s lease or, if the business floor space is owned by the business, as calculated in the same manner as if the area was rented using commonly accepted standards of measurement for leasing purposes such as the Standard Methods of Measurement published by the Building Owners and Managers Association (BOMA). Any method of measurement used must meet the following minimum standards: (1)It shall be computed by measuring to the inside finish of permanent outer building walls and shall include space used by columns and projections necessary to the building. (2)It shall include both the area used by the business and a proportionate share of the building service areas such as lobbies, corridors and other common areas in a building unless assigned to another business for tax calculation purposes. (3)It shall not include vertical penetrations through the building such as stairs, elevators, or heating, ventilation, air conditioning, utility, or telephone systems, except on the lowest floor of stairs and elevators. b Packet Pg. 215 AA2 NOT YET APPROVED 6 (4)For the business of renting or leasing property, it shall include area used primarily for the business operator’s offices and operational facilities. (5)It shall not include residential uses, including multiple-family use as defined in section 18.04.030(102), two-family use as defined in section 18.04.030(141), single-family residential use as defined in section 18.04.030(86)(A)), mobile home park as defined in section18.04.030(97), residential care homes as defined in section 18.04.030(124), supportive housing as defined in section 18.04.030(135.5), transitional housing as defined in section 18.04.030(138), emergency shelter as defined in section 18.04.030(50), and any equivalent residential use defined by the city. (6)It shall include hotel as defined in section 18.04.030(73). (7)Square footage for businesses with multiple locations will be measured and tax assessed will be calculated based on the aggregate square footage for the business for all locations in the city. (n)“Tax Administrator” means the Director of Administrative Services, or successor position, or their designee. (o)“Transient Occupancy Tax” means the tax imposed under section 2.33.020. (p)“Transitory business” means a business that operates in the city for less than 90 days in the course of one calendar year (such as seasonal sale lots, special events, concerts/performances/circuses, filming, and party rentals). (q)“Vacant” means a severable portion of the physical location that a business is occupying, such as an entire floor, a building, or a portion of a floor with independent entrance and exit, that is free from any use, fixtures, furniture, and equipment, and is immediately available for use by a new tenant or owner. 2.37.030 Obligation to Pay Business Tax (a)It is unlawful for any business operator, either for themselves or for any other person, to operate in the city any business taxed under this chapter without paying all business tax required by this chapter. (b)If a business has more than one business operator, then the payment of the business tax by one business operator excuses any other business operators from the obligation to pay the business tax for that period for which the tax has been paid. (c)The requirement to pay business tax is in addition to and separate from the requirement to obtain a business registration certificate under section 4.60.030. b Packet Pg. 216 AA2 NOT YET APPROVED 7 (d)The payment of business tax does not authorize the doing of any act which the person or business paying the business tax is not otherwise entitled to do and does not excuse the business from complying with other applicable Code requirements. 2.37.040 Imposition of Business Tax Any business operator operating a business at a fixed place of business in the city must pay a business tax at the following rates: (a)Beginning January 1, 2023, the tax shall be imposed at the following rates: (1)For the first 10,000 square feet occupied by a business in the city, no tax shall be imposed. (2)For each square foot occupied by a business in the city over 10,000 square feet, a monthly tax of five and one-half (5.5) cents per square foot shall be imposed. (b)Beginning January 1, 2025, the tax shall be imposed at the following rates: (1)For the first 10,000 square feet occupied by a business in the city, no tax shall be imposed. (2)For each square foot occupied by a business in the city over 10,000 square feet, a monthly tax of eleven (11) cents per square foot shall be imposed. (c)The maximum amount of tax a business must pay is capped at $1,000,000 (one million dollars) per fiscal year. 2.37.045 Order of Calculations Tax owed shall be determined by applying the terms of this ordinance in the following order: first, application of the tax rate in subdivisions (a) or (b) of section 2.37.040 to the square footage of the business; second, application of business tax offsets as set forth in section 2.37.080, if any; and third, application of the tax cap in subdivision (c) of section 2.37.040, if applicable. 2.37.050 Annual CPI Adjustment of Tax Rate (a)Beginning with the 2026-27 fiscal year, and each fiscal year thereafter, the tax rate in subdivision (b)(2) of section 2.37.040 and the cap in subdivision (c) of section 2.37.040 shall be automatically increased by a percentage equal to the percentage increase in the CPI Index in the previous calendar year (“the CPI Increase”). (b)Notwithstanding subdivision (a) of this section, in any year in which the CPI Increase is b Packet Pg. 217 AA2 NOT YET APPROVED 8 more than 5%, the increase in the tax rate in subdivision (b)(2) of section 2.37.040 will be limited to 5%. 2.37.060 Disposition of Tax Revenue The tax imposed by this chapter is for the purpose of raising revenue for the general governmental purposes of the city. All of the proceeds from the tax imposed by this chapter shall be placed in the city’s general fund. 2.37.070 Exemptions from Tax (a)The following businesses are exempt from the tax imposed by this chapter: (1)Any business exempt from the tax by the laws of the United States or the State of California; (2)Grocery stores; (3)Businesses that occupy or use 10,000 square feet or less in the city; and (4)Transitory businesses. (b)If a business operator operates a single integrated business that has two or more parts, one or more of which could be exempt from the tax imposed by this chapter if operated as a separate business, the city may, at its discretion, exempt from the tax any part of the business that would be exempt if operated as a separate business, provided the business’s square footage can be reasonably allocated between the parts. If the city determines that the square footage cannot be reasonably allocated between the different parts of the business, then the entire business shall be taxed, unless to do so would violate a law of the United States or the State of California. 2.37.080 Business Tax Offsets (a)A business operator that operates a hotel in the city may deduct from the business tax it owes for a quarter for the business of operating the hotel an amount equal to the total transient occupancy tax collected and remitted to the city in the same quarter of the previous fiscal year from transients staying at the hotel. (b)The business operator of a business that has discretion to determine the location of the place of sale, place of use, or principal place of negotiation for sales or use tax purposes and which exercises that discretion and designates the city as the place of sale, place of use, or principal place of negotiation for sales or use tax purposes which results in the city receiving sales or use tax revenues that it would not otherwise have received, but for the business’s exercise of its discretion to designate the city as the place of sale, place of use, or principal place of negotiation for sales or use tax purposes b Packet Pg. 218 AA2 NOT YET APPROVED 9 (“Discretionary Sales or Use Tax Sales”) may deduct from the business tax it owes for a quarter an amount equal to one half of the total sales tax or use tax received by the city from the Discretionary Sales or Use Tax Sales of that business in the same quarter of the previous fiscal year. This offset can offset up to, but no more than, 75% of the business’s quarterly business tax. The city and a business operator may enter into an agreement implementing this section. (c)A business claiming an offset under this section must claim the offset with its tax filing for the quarter for which the offset is claimed. (1)If the information necessary for a business to claim an offset is not available, the business may defer claiming an offset for up to one year or for another period of time set by written agreement with the city. (2)The Tax Administrator may require a business claiming an offset to submit additional information to support the claim of the offset. The request for additional information must be made in writing and the information must be provided within thirty (30) days. (3)If the Tax Administrator determines that an offset claimed by a business is incorrect, the Tax Administrator may make an Initial Determination of the amount, if any, of the offset and the amount of tax due under subdivision (a) of section 2.37.150. 2.37.090 Quarterly Tax Payments (a)The tax imposed by this chapter shall be paid quarterly. The tax for each quarter is due the first day of the following quarter and is delinquent thirty (30) days later. (b)For the first quarter in which a business begins operating in the city, the business’s tax shall be prorated for the number of days that the business was operating in the quarter. (c)For the last quarter in in which a business operates in the city before closing, the business’s tax shall be prorated for the number of days that the business was operating in the quarter. 2.37.100 Business Tax Filing for a New Business When a business begins operating in the city for the first time, the business operator must provide the Tax Administrator with the following information, verified by the business operator as true and correct under penalty of perjury of the laws of the State of California, before beginning the operation of the business in the city: (a)The name of the business and the address or addresses at which it will be operating in the city; b Packet Pg. 219 AA2 NOT YET APPROVED 10 (b)The date on which the business will begin operating; (c)The nature of the business’s activities; (d)The square footage in which the business will be operating in the city; and (e)Any other information required by the Tax Administrator that is reasonably required to administer this Chapter 2.37. 2.37.110 Quarterly Tax Returns With each quarterly tax payment, a business operator must submit a quarterly tax return which contains the following information, verified by the business operator as true and correct under penalty of perjury of the laws of the State of California: (a)The name of the business and the address or addresses at which it is operating in the city; (b)The nature of the business’s activities; (c)The square footage in which the business is operating in the city; (d)If the business operator claims an offset under section 2.37.080, sufficient information and documentation to establish the business’s right to the offset and the amount of the offset; (e)Any other information required by the Tax Administrator; and (f)The amount of tax due based on the square footage of the business. 2.37.120 Agreements for Installment Payments The Tax Administrator may enter into an agreement with a business operator to allow a business operator to pay the tax on a more or less frequent basis. 2.37.130 Businesses Operating in the Same Location (a)Each business operator operating a business in a location where one or more other businesses are also operating is obligated to pay business tax measured by the square footage occupied by that business. (b)The payment of business tax by a business operator absolves any other business operator from having to pay business tax measured by the same square footage. b Packet Pg. 220 AA2 NOT YET APPROVED 11 (c)Two or more business operators that are operating businesses in the same square footage may contractually agree which business will pay the business tax measured by that square footage. 2.37.140 Delinquent Taxes (Penalties and Interest) (a)When a tax becomes delinquent, a penalty of 10% of the amount of the delinquent tax will be added to the amount of tax due. If the tax remains unpaid sixty (60) days after becoming delinquent, an additional penalty of 25% of the amount of the delinquent tax (excluding accrued interest and the initial penalty) will be added to the amount of tax due. (b)On the first of each month that a tax is delinquent, interest in the amount of 1.5% of the delinquent amount, excluding penalties and interest, will be added to the amount of tax due. (c)A business operator may apply to the Tax Administrator for a reduction or waiver of any accrued penalties or interest, and the Tax Administrator may reduce or waive any accrued penalties or interest upon a finding of good cause. 2.37.150 Administrative Procedure to Assess or Correct Tax (a)If the Tax Administrator determines that a business operator has incorrectly reported any information to the city or has not paid all or any of the tax, penalties, or interest that are due, the Tax Administrator may, using any information available to the Tax Administrator, issue an Initial Determination stating what the Tax Administrator believes to be the correct information and, if new or additional tax, penalties, or interest are due, how much tax, penalties, or interest are due. An Initial Determination must be issued within five (5) years of the last day of the quarter to which the Initial Determination applies, except in the case of an audit conducted under section 2.37.200, in which case it must be issued within ninety (90) days of the completion of the audit and can apply to any of the quarters that were subject to the audit. The Initial Determination shall be served on the business operator either personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. Service is effective upon deposit of the Initial Determination in the U.S. Mail. (b)A business operator affected by an Initial Determination may within thirty (30) days of service of an Initial Determination contest the Initial Determination and request a hearing before the Tax Administrator by filing with the Tax Administrator a written request for a hearing. The further accrual of penalties and interest shall be tolled upon the filing of a request for a hearing. If a business operator does not contest an Initial Determination and request a hearing with the Tax Administrator within fifteen (15) days of service of the Initial Determination, the Initial Determination shall become final and cannot be appealed. b Packet Pg. 221 AA2 NOT YET APPROVED 12 (c)If a business operator timely contests an Initial Determination and requests a hearing, the Tax Administrator shall set a hearing within sixty (60) days of the filing of the request for a hearing. Notice of the hearing shall be served on the business operator either personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. (d)At the hearing the business operator may present evidence and argument regarding the Initial Determination to show why the Initial Determination is incorrect and to show what the determination of the Tax Administrator should be. Within sixty (60) day after the close of the hearing, the Tax Administrator shall serve a Final Determination, setting forth the Tax Administrator’s determination of the facts and issues that were the subject of the Initial Determination. The Final Determination shall be served on the business operator either personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. Service is effective upon deposit of the Final Determination in the U.S. Mail. Unless an appeal of a Final Determination is filed under section 2.37.170, any penalties or interest tolled under subdivision (b) of this section will resume accruing ten (10) days after the service of the Final Determination. 2.37.160 General Administrative Remedy (a)Any person affected by a decision of the Tax Administrator (“the challenger”), except for decisions under section 2.37.150, may challenge that decision by filing a written objection to the decision with the Tax Administrator. The objection must be filed within thirty (30) days of the issuance of the decision being challenged. If the Tax Administrator was required to provide notice of the decision, then the time to file an objection to the decision begins to run from the date of service of the notice of the decision. The Tax Administrator shall serve a written response to the objection within thirty (30) days of the filing of the objection, which period can be extended by the Tax Administrator for an additional thirty (30) days. The Tax Administrator’s response to the objection shall be served on the challenger either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. (b)The challenger may request a hearing on the Tax Administrator’s response to the objection by filing a request for a hearing with the Tax Administrator within thirty (30) days of service of the response to the objection. If a timely request for a hearing on a response to the objection is filed with the Tax Administrator, the Tax Administrator shall set a hearing within sixty (60) days of the filing of the request for a hearing. Notice of the hearing shall be served on the challenger either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. (c)At the hearing the challenger may present evidence and argument regarding the decision being challenged to show why the decision is incorrect and to show what it should be. Within sixty (60) days after the close of the hearing, which the Tax Administrator may extend for an additional sixty (60) days, the Tax Administrator shall serve a Final Determination on the decision, setting forth the Tax Administrator’s b Packet Pg. 222 AA2 NOT YET APPROVED 13 determination of the decision that was challenged. The Final Determination shall be served on the challenger either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. Service is effective upon deposit of the Final Determination in the U.S. mail. 2.37.170 Appeals (a)A Final Determination of the Tax Administrator under section 2.37.150, subdivision (d), or section 2.37.160, subdivision (c), can be appealed to the City Manager by filing a written notice of appeal with the City Manager within thirty (30) days of service of the notice of the Final Determination being appealed. (b)Only a business operator who files a timely request for a hearing on an Initial Determination under section 2.37.150 and participates in the hearing or a challenger who files an objection to a decision and files a request for a hearing on the response to the objection under section 2.37.160 and participates in the hearing can file an appeal under this section. (c)If a timely appeal is filed with the City Manager, the City Manager, or the City Manager’s designee, shall set a hearing within sixty (60) days of the filing of the appeal, which may be extended by the City Manager for an additional thirty (30) days. Notice of the hearing shall be served on the appellant either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. The tolling of the accrual of penalties or interest under section 2.37.150, subdivision (b), shall continue upon the timely filing of an appeal under this section. (d)At the hearing the appellant and the Tax Administrator may present evidence and argument regarding the decision being appealed to show why the decision is correct or incorrect and to show what it should be. Within sixty (60) days after the close of the hearing, which the City Manager or the City Manager’s designee may extend for an additional sixty (60) days, the City Manager or the City Manager’s designee shall serve a written decision, setting forth the resolution of the appeal. The decision shall be served on the appellant either personally or by U.S. mail to the most recent address for the appellant in the City Manager’s records. Service is effective upon deposit of the decision in the U.S. Mail. Any penalties and interest that were tolled under section 2.37.150, subdivision (b), shall resume accruing ten (10) days after the service of the decision. (e)A decision of the City Manager, or the City Manager’s designee, served under subdivision (d) of this section is subject to judicial review under sections 1094.5 and 1094.6 of the Code of Civil Procedure with a writ petition filed in the appropriate court within ninety (90) days of the service of the written decision. Any tax, penalties, or interest determined by the decision to be owed to the city by the appellant must be paid to the city as a precondition to filing a writ petition challenging the decision, but a claim for a refund under section 2.37.190 does not have to be filed before filing a writ petition. b Packet Pg. 223 AA2 NOT YET APPROVED 14 2.37.180 Constitutional Apportionment (a)No tax imposed by this chapter shall be applied to a business operator so as to constitute an undue burden on interstate commerce or intercity commerce or be violative of the equal protection or due process clauses of the United States or California constitutions. (b)A business operator who contends that the application of a tax imposed by this chapter on the business operator constitutes an undue burden on interstate commerce or intercity commerce or violates the equal protection or due process clauses of the United States or California constitutions may apply to the Tax Administrator for an apportionment of the tax imposed on the business operator that would remove the constitutional violation by filing a written request with the Tax Administrator that explains the factual and legal basis for the claimed constitutional violation and proposes a method of apportionment that would resolve the alleged constitutional violations. (c)The Tax Administrator, in consultation with City Attorney, shall review the application and within sixty (60) days of the filing of the application, which deadline may be extended for an additional sixty (60) days, issue a decision on the application. The decision on the application shall be served on the business operator either personally or by U.S. mail to the most recent address for the challenger in the Tax Administrator’s records. The decision can be challenged under section 2.37.160. 2.37.190 Refunds (a)A business operator who believes that any tax, penalty, or interest has been illegally, erroneously, or mistakenly paid to, collected by, or otherwise received by the city may file a claim for a refund of the amount of tax, penalty, or interest claimed to have been improperly received by the city. (b)The claim must be filed with the Tax Administrator and signed under penalty of perjury by the business operator. The claim must state: (1)The legal and factual basis for the refund claim; (2)The amount of tax, penalty, or interest allegedly improperly received by the city; (3)The date or dates that the improper payments were made to the city; and (4)The address of the claimant. (c)The claim must be filed with the Tax Administrator within two (2) years of the date of the allegedly improper payment to the city. b Packet Pg. 224 AA2 NOT YET APPROVED 15 (d)The Tax Administrator shall provide a written decision on the claim within thirty (30) days of the filing of the claim by serving the decision on the claimant either personally or by U.S. mail to the address provided in the claim. Service is effective upon deposit of the response in the U.S. Mail. (e)A claimant may challenge the Tax Administrator’s decision on a refund claim under section 2.37.160. (f)This section does not apply to: (1)A claim for a refund arising out of a decision of the Tax Administrator, City Manager, or City Manager’s designee under sections 2.37.150, 2.37.160, 2.37.170, or 2.37.190; or (2)A claim that could have been asserted by the claimant, but was not, under sections 2.37.150, 2.37.160, 2.37.170, or 2.37.190. 2.37.200 Audits (a)The Tax Administrator may conduct an audit of any business operator to ensure proper compliance with the requirements of this chapter. (b)To initiate an audit the Tax Administrator shall provide written notice to the business operator that is the subject of the audit of the initiation of the audit by serving the notice personally or by U.S. mail to the most recent address for the business operator in the Tax Administrator’s records. The notice shall state the period of time subject to the audit. (c)Notice of the initiation of an audit for a quarter for which either a business tax filing for a new business or quarterly tax return was submitted under section 2.37.100 or section 2.37.110 must be served within three (3) years of the last day of the quarter to which the filing or return applied. (d)Notice of the initiation of an audit for a quarter for which neither a business tax filing for a new business nor a quarterly tax return was submitted under section 2.37.100 or section 2.37.110, but for which the business was registered as a business under section 4.60.030, must be served within five (5) years of the last day of the quarter for which the filing or return should have been filed. (e)Notice of the initiation of an audit for a quarter for which neither a business tax filing for a new business nor a quarterly tax return was submitted under section 2.37.100 or section 2.37.110, and for which the business was not registered as a business under section 4.60.030, must be served within seven (7) years of the last day of the quarter for which the filing or return should have been filed. b Packet Pg. 2255 AA2 NOT YET APPROVED 16 (f)Upon completion of an audit, the Tax Administrator may make an Initial Determination under subdivision (a) of section 2.37.150 of any taxes, penalties, and interest determined to be owed and not paid for the audit period. The Initial Determination must be issued within ninety (90) days of the completion of the audit. If a business operator subject to audit is unable or unwilling to provide sufficient records to enable the Tax Administrator to verify compliance with this chapter, the Tax Administrator is authorized to make a reasonable estimate of the amount of tax due and the reasonable estimate shall be entitled to a rebuttable presumption of correctness. 2.37.210 Maintenance and Review of Records (a)Business operators must maintain for six (6) years records of square footage and information necessary to calculate the tax. If the Tax Administrator serves notice of the initiation of an audit, the information pertinent for the quarters subject to the audit must be maintained until the conclusion of the audit. (b)The Tax Administrator may with reasonable notice inspect the premises and records of the business operator. (c)The Tax Administrator may request the city council to issue an administrative subpoena for records of a business operator or other persons with relevant information. 2.37.220 Confidentiality of Records All documents submitted to the city by a business operator under this chapter and all documents of a business operator inspected by the Tax Administrator in the conduct of an audit are presumed to be confidential and will not be subject to public inspection to the fullest extent allowed by law and must be maintained so that the contents of the documents will not become known except to persons charged with the administration of this chapter. Confidential documents may be shared with consultants retained by the city to aid in the administration of this chapter, provided the consultants agree to maintain the confidentiality of the documents. However, nothing in this section precludes the city from aggregating information and releasing it in a manner that does not identify any particular business or connect any information with a particular business. 2.37.230 Action to Collect Delinquent Taxes (a)Any tax, penalty, and interest imposed on a business operator under this chapter is a debt owed by the business operator to the city, which may be recovered in an action filed by the city in a court of competent jurisdiction. (b)An action under this section shall be filed within three (3) years of an Initial Determination becoming final under subdivision (b) of section 2.37.150, the issuance of a Final Determination under subdivision (d) of section 2.37.150 that is not appealed, the b Packet Pg. 226 AA2 NOT YET APPROVED 17 issuance of a Final Determination under subdivision (c) of section 2.37.160 that is not appealed, or the issuance of a decision under subdivision (d) of section 2.37.170. (c)During the pendency of an action filed under this section, interest will continue to accrue under subdivision (b) of section 2.37.140 until the entry of judgment. (d)Before filing an action, the city may serve the business operator either personally or by U.S. mail at the most recent address for the business operator in the Tax Administrator’s records with notice of the pending action and give the business operator fifteen (15) days to pay all of the delinquent taxes, penalties, and fees. If all of the of the delinquent taxes, penalties, and fees are not paid within the fifteen-day period, then an additional penalty of 25% of the amount of the delinquent tax (including accrued penalties and interest) shall be added to the total delinquency and may be recovered in the action. 2.37.240 Errors Not Binding on the City No error by the Tax Administrator or any other officer, employee, or agent of the city in the application of this chapter shall prevent, prejudice, or estop the collection by or for the city of the full amount of tax owed by any person under this chapter. 2.37.250 Dates If the last day for the performance of any act under this chapter is a Saturday, Sunday, or holiday recognized by the city, then the date for the performance of that act is extended to the next day that is not a Saturday, Sunday, or holiday recognized by the city. 2.37.260 Rules and Regulations (a)The Tax Administrator may adopt rules and regulations that are not inconsistent with the provisions of this chapter as may be necessary to aid in the application and enforcement of this chapter. (b)The Tax Administrator may adopt rules providing for the service or filing of any notices, filings, returns, or submittals required by this chapter. These rules may provide alternative means for serving or filing any notice, filing, return, or submittal, and may clarify the method of serving or filing any notice, filing, return, or submittal provided for in this chapter. 2.37.270 City Council Amendments (a)The city council may amend this chapter in any way it deems necessary without the approval of the electorate, provided the amendment does not increase the amount of tax that any person would pay. b Packet Pg. 227 AA2 NOT YET APPROVED 18 (b)Any amendment to this chapter that would reduce the amount of tax any taxpayer would pay, either temporarily or permanently, must be approved by two-thirds (2/3) of the members of the city council. (c)Notwithstanding subdivision (a) of this section, the city council may with the approval of two-thirds (2/3) of its members and without approval of the electorate reduce, revise, or eliminate any of the business tax offsets in section 2.37.080. 2.37.280 Severability If any word, phrase, sentence, part, section, subsection, or other portion of this chapter, or any application thereof to any person or circumstance is declared void, unconstitutional, or invalid for any reason, then such word, phrase, sentence, part, section, subsection, or other portion, or the prescribed application thereof, shall be severable, and the remaining provisions of this chapter, and all applications thereof, not having been declared void, unconstitutional or invalid, shall remain in full force and effect. The People of the City of Palo Alto hereby declare that they would have passed this ordinance, and each section, subsection, sentence, clause and phrase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases had been declared invalid or unconstitutional. 2.37.290 Savings Clause No section, clause, part, or provision of this chapter shall be construed as requiring the payment of any tax that would be in violation of the Constitution or laws of the United States of America or of the Constitution or laws of the State of California. 2.37.300 Sunset The tax imposed by this Chapter shall cease to be imposed on January 1, 2058. SECTION 2. Implementation Procedures 1.The new tax imposed by this ordinance will go into effect on January 1, 2023. 2.Notwithstanding sections 2.37.090, 2.37.100, and 2.37.110 of the codified part of this ordinance, the tax imposed by this ordinance will initially be due on the following schedule: (a)The initial tax payment for the tax that has accrued since January 1, 2023 will be due on January 1, 2024, or on a subsequent date established by the Tax Administrator and will be delinquent 30 days later if not paid. (b)With its initial tax payment, each business shall provide the following information: (1)The name of the business and the address or addresses at which it will be operating in the city; b Packet Pg. 228 AA2 NOT YET APPROVED 19 (2)The nature of the business’s activities; (3)The square footage in which the business will be operating in the city; (4)If the business operator claims an offset under section 2.37.080, sufficient information and documentation to establish the business’s right to the offset and the amount of the offset; (5)Any other information required by the Tax Administrator; and (6)The amount of tax due based on the square footage of the business. (c)A business that begins operating for the first time after January 1, 2023, must submit its initial tax payment and initial information by the date provided in this uncodified section or by the date provided in codified section 2.37.090, whichever is later. SECTION 3. General Tax. Proceeds of the tax imposed by this Ordinance shall be deposited in the general fund of the City and shall be available for any legal purpose. SECTION 4. Effective Date. This ordinance shall be effective only if approved by a majority of the voters and shall go into effect immediately after the vote is declared by the City Council. SECTION 5. Execution. The Mayor is hereby authorized to attest to the adoption of this Ordinance by the voters of the City by signing where indicated below. I hereby certify that the foregoing Ordinance was PASSED, APPROVED and ADOPTED by the People of the City of Palo Alto voting on the 8th day of November, 2022. ATTEST: __________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ___________________________ City Attorney City Manager ___________________________ Director of Administrative Services b Packet Pg. 229 AA2 NOT YET APPROVED Resolution No. ____ Resolution of the Council of the City of Palo Alto Adopting Advisory Spending Guidelines for Proceeds of a Business Tax to be Submitted to the Voters for Approval in November 2022 R E C I T A L S A. The City of Palo Alto is a well-run municipality, with a Triple-A bond rating and a reputation for pro-active fiscal management, strong ongoing investments in public infrastructure, and conservative financial planning. However, the impacts of COVID-19, the subsequent economic downturn, and legal challenges to longstanding historic revenue sources have contributed to a projected budget gap in the City of Palo Alto’s general fund. B. Unlike most communities in California, the City of Palo Alto does not require local businesses to contribute to city projects and services through a local business tax. As Palo Alto looks to the future, City leaders have determined that the time has come to seek voter approval to tax mid-sized and large businesses operating in the City as neighboring communities do. Diversifying revenues with contributions from business will ensure that businesses pay a fair share and contribute to services used by residents, visitors and workers in the community. C. If a business tax is approved by voters, its proceeds will be placed in the City’s general fund for use on general government services. Council Members elected by the voters will determine the uses of those proceeds that best serve the public interest. D. With this Resolution, the City Council informs voters of its intentions regarding the public services and programs that would be supported by business tax revenues. Accordingly the Council of the City of Palo Alto RESOLVES as follows: SECTION 1. This Resolution No. _____ updates and supersedes Resolution No. 10058, which is hereby repealed and shall be of no force or effect. SECTION 2. Council hereby adopts the above Recitals as findings of the Council. SECTION 3. It is the Council’s intention to use proceeds of a business tax—a general tax for general government uses—to fund services and programs that support safety and quality of life. The Council approves the following advisory spending guidelines: One-Third for Transportation and Safe Train Crossings. In the coming years, Palo Alto will need to need to invest substantial local funds in the improvement and safety of train crossings. CalTrain is electrifying and trains are increasing in number. To maintain traffic flow, bicycle and pedestrian mobility, and safety, the City’s four at-grade road crossings must be modified and separated from the train right-of-way. It is estimated that an average investment of $250 million will be needed for the improvements needed at each crossing. City funds will be used as matching funds to secure additional county, state, and federal funds for these investments in transportation infrastructure. ATTACHMENT C c Packet Pg. 230 AA2 NOT YET APPROVED The Council plans to spend one-third of business tax proceeds on safe and efficient crossings for vehicles, bicyclists, and pedestrians. One-Third for Housing Affordability and Services for the Unhoused. A balanced and healthy community welcomes families and individuals from all walks of life. In Palo Alto, significant investments are needed to bring housing costs into reach for many moderate earners who work in the City, such as teachers, public safety employees, and workers in the trades and service industries. With few affordable local housing options, these workers must travel long distances between home and work, contributing to green-house gas emissions and traffic congestion. In addition, longtime residents—especially those who rent—are at risk of losing housing and being forced to relocate to other communities or become unhoused. Those who are already living in the City without housing need financial support to transition to stable, safe and clean housing. Substantial funding is needed to advance these goals. The Council plans to spend one-third of business tax proceeds on affordable housing and unhoused services. One-Third for Public Safety. Rising costs and constrained revenues have limited the City’s ability to provide public safety services—including police, fire, 911, and emergency services—at the level desired by the community. Stable long-term revenues from a business tax will put these highly- valued City services on sound footing into the future. The Council plans to spend one-third of business tax proceeds on public safety. SECTION 4. The Council finds that adoption of this Resolution is not a project under the California Environmental Quality Act and, therefore, no environmental impact assessment is necessary. INTRODUCED AND PASSED: AYES: NOES: ABSTENTIONS: ABSENT: ATTEST: APPROVED: __________________________ ____________________________ City Clerk Mayor APPROVED AS TO FORM: __________________________ ____________________________ City Attorney City Manager c Packet Pg. 231 AA2 Not Yet Approved Resolution No. ______ Resolution of the Council of the City of Palo Alto Calling an Election for November 8, 2022 for Submittal to the Qualified Electors of the City a Measure Affirming the City’s Natural Gas Utility General Fund Transfer R E C I T A L S A.Pursuant to the City of Palo Alto Charter, Article VII, Section 2 (Public Utilities Revenue) the City of Palo Alto has had a decades-long practice of annually transferring funds from the natural gas utility to the general fund to fund general city services. B.In 2021, in the case of Green v. City of Palo Alto, Santa Clara County Superior Court No. 16CV300760, the Superior Court determined that voter approval is required with respect to the portion of transferred funds that are generated from retail natural gas rates. C.The natural gas utility transfer is an important part of funding for basic City services such as roads, parks, libraries, climate change reduction, and police, fire, emergency medical, and 9-1-1 response. Affirming the continuation of the City’s long-standing transfer practice does not raise gas rates. D.A proposed ordinance attached hereto and incorporated herein by reference as Attachment “A” (the “Ordinance”) would amend the Palo Alto Municipal Code to affirm Palo Alto’s existing and decades-old practice of annually transferring up to 18% of the gross revenues of the gas utility (generated by retail natural gas rates) to the general fund to support general city services. E. By its Resolution No. 10045 the City Council called a general municipal election for November 8, 2022 (“Election”). F.Pursuant to Government Code Section 53724 and Elections Code Section 9222, the City Council desires to submit the Ordinance to the voters of the City. The City Council of the City of Palo Alto RESOLVES as follows: SECTION 1. Findings. The City Council finds and determines that each of the findings set forth above are true and correct. SECTION 2. General Tax Election. The City Council proposes to impose the general tax set forth in the Ordinance and to present this proposal to the voters on November 8, 2022. SECTION 3. Measure. Pursuant to Elections Code Section 9222, the City Council hereby submits the Ordinance to the voters at the Election and orders the following question to be submitted to the voters at the Election: ATTACHMENT D d Packet Pg. 232 AA2 NOT YET APPROVED 2 Shall the measure affirming the City of Palo Alto’s existing and decades-old practice of annually transferring no more than 18% of the gross revenues from the City’s natural gas utility (generated by the City’s retail natural gas rates) to its general fund to support general city services such as roads; parks; libraries; climate change reduction; police, fire, emergency medical, and 9-1-1 response; providing approximately $7 million annually in existing revenues until ended by voters, be adopted? YES NO This question requires the approval of a majority of those casting votes. SECTION 4. Adoption of Measure. The measure to be submitted to the voters is attached to this Resolution as Exhibit A and incorporated herein by this reference. SECTION 5. Notice of Election. Notice of the time and place of holding the Election is hereby given, and the City Clerk is authorized, instructed and directed to give further or additional notice of the Election, in time, form and manner as required by law. SECTION 6. Impartial Analysis. Pursuant to Elections Code Section 9280, the City Council hereby directs the City Clerk to transmit a copy of the measure to the City Attorney. The City Attorney shall prepare an impartial analysis of the measure, not to exceed 500 words in length, showing the effect of the measure on the existing law and the operation of the measure, and transmit such impartial analysis to the City Clerk on or before August 23, 2022. SECTION 7. Ballot Arguments. Pursuant to Elections Code Section 9286 et. seq., August 16, 2022 at 5:00 p.m. shall be the deadline for submission of arguments in favor of, and arguments against, any local measures on the ballot. If more than one argument for and/or against is received, the priorities established by Elections Code Section 9287 shall control. SECTION 8. Rebuttal Arguments. The provisions of Elections Code Section 9285 shall control the submission of any rebuttal arguments. The deadline for filing rebuttal arguments shall be August 23, 2022 at 5:00 p.m. SECTION 9. Consolidation Request. The Council of the City of Palo Alto requests the governing body of any other political subdivision, or any officers otherwise authorized by law, to partially or completely consolidate such elections and the City Council consents to such consolidation. The Council requests the Board of Supervisors of Santa Clara County to include on the ballots and sample ballots, all qualified measures submitted by the City Council to be ratified by the qualified electors of the City of Palo Alto. The Council acknowledges that the Election will be held and conducted according to procedures in the Elections Code, including Section 10418. SECTION 10. Request for County Services. Pursuant to Section 10002 of the Elections Code, the Council of the City of Palo Alto hereby requests the Board of Supervisors of Santa Clara d Packet Pg. 233 AA2 NOT YET APPROVED 3 County to permit the Registrar of Voters to render services to the City of Palo Alto relating to the conduct of Palo Alto’s General Municipal and Special Elections which are called to be held on Tuesday, November 8, 2022. The services shall be of the type normally performed by the Registrar of Voters in assisting the clerks of municipalities in the conduct of elections including, but not limited to, checking registrations, mailing ballots, hiring election officers and arranging for polling places, receiving absentee voter ballot applications, mailing and receiving absent voter ballots and opening and counting same, providing and distributing election supplies, and furnishing voting machines. SECTION 11. Transmittal of Resolution. The City Clerk is hereby directed to submit forthwith a certified copy of this resolution to the Santa Clara County Board of Supervisors and to the Registrar of Voters. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSENTIONS: ATTEST: APPROVED: _____________________________ ______________________________ City Clerk Mayor ______________________________ APPROVED AS TO FORM: City Manager _____________________________ ______________________________ City Attorney Director of Administrative Services d Packet Pg. 234 AA2 NOT YET APPROVED 4 Exhibit A Ordinance No. _____ Ordinance of the Council of the City of Palo Alto Amending Chapter 2.28 (Fiscal Procedures) of Title 2 of the Palo Alto Municipal Code to Authorize the City Council to Continue to Annually Transfer from the Natural Gas Utility to the General Fund an Amount Equal to 18% of the Gross Revenues of the Natural Gas Utility, Generated by the City’s Retail Natural Gas Rates The People of the City of Palo Alto do ordain as follows: SECTION 1. Chapter 2.28 of the Palo Alto Municipal Code is hereby amended by adding Section 2.28.185 as follows: Chapter 2.28 FISCAL PROCEDURES 2.28.185 Natural Gas Utility Transfer Each fiscal year the City Council may transfer from the natural gas utility to the general fund an amount equal to 18% of the gross revenues of the gas utility received during the fiscal year two fiscal years before the fiscal year of the transfer. At its discretion, the City Council may decide to transfer a lesser amount. The projected cost of the transfer shall be included in the City’s retail natural gas rates as part of the cost of providing gas service. SECTION 2. General Tax. Proceeds of the tax imposed by this Ordinance shall be deposited in the general fund of the City and shall be available for any legal purpose. SECTION 3. Amendment or Repeal. The City Council may repeal Section 2.28.185 of the Palo Alto Municipal Code or amend that Section without a vote of the people except that any amendment to Section 2.28.185 that increases the amount or rate of tax due from any person beyond the amounts and rates authorized by this Ordinance may not take effect unless approved by a vote of the people. SECTION 4. Severability. If any section, subsection, sentence, clause, phrase, or portion of this Ordinance is for any reason held to be invalid or unenforceable by a court of competent jurisdiction, the remaining portions of this Ordinance shall nonetheless remain in full force and effect. The people hereby declare that they would have adopted each section, subsection, sentence, clause, phrase, or portion of this Ordinance, irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions of this Ordinance be declared invalid or unenforceable. SECTION 5. Effective Date. This ordinance shall be effective only if approved by a majority of the voters and shall go into effect immediately after the vote is declared by the City Council. d Packet Pg. 235 AA2 NOT YET APPROVED 5 Attachment A SECTION 6. Execution. The Mayor is hereby authorized to attest to the adoption of this Ordinance by the voters of the City by signing where indicated below. I hereby certify that the foregoing Ordinance was PASSED, APPROVED and ADOPTED by the People of the City of Palo Alto voting on the 8th day of November, 2022. ATTEST: __________________________ ___________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ___________________________ City Attorney City Manager ___________________________ Director of Administrative Services d Packet Pg. 236 AA2 City of Palo Alto (ID # 14641) City Council Staff Report Report Type: Action Items Meeting Date: 8/8/2022 City of Palo Alto Page 1 Summary Title: Supplemental Report - 22PLN-00016 Title: PUBLIC HEARING / QUASI -JUDICIAL. 1033 Amarillo Ave [22PLN -00016]: Request for a Preliminary Parcel Map With Exceptions to Subdivide a 20,787 Square Foot R -1 Property Into Two (2) Lots, Where Lot 1 Wil l be 10,668.50 Square Feet and Lot 2 Will be 10,118.77 Square Feet. Exception is for Minimum lot Width and Maximum lot Size. Zoning District R -1 Single Family Residential. From: City Manager Lead Department: Planning and Development Services Supplemental Report for August 1, 2022 Item 9 CONTINUED DATE: AUGUST 8, 2022 TO: HONORABLE CITY COUNCIL FROM: JONATHAN LAIT, DIRECTOR OF PLANNING & DEVELOPMENT SERVICES SUBJECT: PUBLIC HEARING / QUASI-JUDICIAL. 1033 AMARILLO AVE [22PLN- 00016]: REQUEST FOR A PRELIMINARY PARCEL MAP WITH EXCEPTIONS TO SUBDIVIDE A 20,787 SQUARE FOOT R-1 PROPERTY INTO TWO (2) LOTS, WHERE LOT 1 WILL BE 10,668.50 SQUARE FEET AND LOT 2 WILL BE 10,118.77 SQUARE FEET; THE EXCEPTION IS FOR MINIMUM LOT WIDTH AND MAXIMUM LOT SIZE. ZONING DISTRICT R-1 SINGLE FAMILY RESIDENTIAL. This Memorandum provides brief responses to Council questions of staff during the August 1 st public hearing. Council conducted the hearing but continued the hearing for deliberation. Packet Pg. 237 AA3 City of Palo Alto Page 2 Councilmember Stone asked about references in the City’s Comprehensive Plan (Comp Plan) related to ‘naturally affordable’ or ‘affordable by design’ references in the Comp Plan. Councilmember Stone further asked whether the map approval could be conditioned to require displacement assistance or additional affordability in the event of redevelopment, beyond the City’s existing BMR program. This report contains relevant Comp Plan goals, policies, and programs and provides additional information related to displacement and affordability. Relevant Comprehensive Plan/Housing Element Policies Staff have looked through the Comp Plan to find any additional policies relevant to the Councilmember’s topic, those policies are summarized below: •Land Use Element Policy L-2.7 states, “Support efforts to retain housing that is more affordable in existing neighborhoods, including a range of smaller housing types.” Related Program L2.7.1 states, “Review development standards to discourage the net loss of housing units.” •Land Use Element Policy L-2.3 states, “As a key component of a diverse, inclusive community, allow and encourage a mix of housing types and sizes, integrated into neighborhoods and designed for greater affordability, particularly smaller housing types, such as studios, co-housing, cottages, clustered housing, accessory dwelling units and senior housing.” •Housing Element goal H1 for existing neighborhoods is to “Ensure the preservation of the unique character of residential neighborhoods” and the related policy is “Promote the rehabilitation of deteriorating or substandard residential properties using sustainable and energy conserving approaches.” •Program H1.1.3, “Provide incentives to developers such as reduced fees and flexible development standards to encourage the preservation of existing rental cottages and duplexes currently located in the R-1 and R-2 residential areas”. The five-year objective is to provide 10 rental cottages and duplexes using the city housing fund. •Housing Element goal H3 is to “meet underserved housing needs and provide community resources to support our neighborhoods. Related policies and programs are: o Policy H3.1 is to “encourage, foster, and preserve diverse housing opportunities for very low-, low-, and moderate income households.” Packet Pg. 238 AA3 City of Palo Alto Page 3 o Policy H1.2 is to “Support efforts to preserve multifamily housing units in existing neighborhoods.” Staff Analysis The Comp Plan encourages the retention of housing that is affordable and housing that supports a diverse community; it celebrates a mix of housing types, including cottage and cluster housing, and seeks to encourage its retention through reduced fees and other development incentives. These policies could be interpreted as lending support toward an interest to retain the subject cottage cluster because of its unique housing layout and, arguably, increased affordability given it represents smaller, older housing stock that would not command the same rents as new construction. Comp Plan policies are intended to be general and provide policy guidance. It is not uncommon for a project to comply with most policies and not others. When staff reviews a project for conformance, it considers the totality of the Comp Plan policies and implementing regulations. The zoning code is the principal tool used to implement Comp Plan la nd use policies. There are no current zoning regulations or financial or development incentives that implement Comp Plan policies related to cottage clusters in the R-1 zoning district. The 2018 Housing Work Plan included exploration of this topic but other policy work received priority focus. Staff is including work on cottage clusters in the updated Housing Element but anticipates it would still be several years before policies are implemented. Last year, staff met with the applicant’s representative to discuss development incentives that could be used to encourage the retention of the cottage clusters on the subject property. Use of the planned home zoning application was a consideration but the applicant was not sufficiently motivated in this regard and a short time later the City Council clarified that planned home zoning applications were not intended for the R-1 zoning district. The applicant presented a pre-screening application to the City Council on October 25, 2021 to subdivide the property into four lots generally reflecting the layout of the existing cottage clusters but also sought to develop each lot with a two-story building and accessory dwelling. This would have resulted in four net new units, eight total units. The Council expressed some concern with this approach and the applicant subsequently filed the subject application to divide the lot in half. Any redevelopment of the site must restore at least four units to remain in compliance with State law (SB 330). Even if the parcel map application were denied the property owner could still demolish the existing homes and replace it in the same configuration (building footprint, floor area, etc). While smaller, older housing units may demand less rent, delaying redevelopment without financial or development incentives to retain and improve the condition of this housing typology may have down sides as well. Packet Pg. 239 AA3 City of Palo Alto Page 4 When considering the findings required to approve the subdivision map and exceptions request, staff concludes that the project remains in substantial compliance with the Comp Plan including some of the policies referenced above. However, the map and exception findings are subjective and a majority of Councilmembers could deny the project based on substantial evidence. Displacement and Affordability The Housing Crisis Act (SB 330) created a number of protections for low and very -low income households displaced by the redevelopment of residential rental properties. If a rental unit was actually rented by a low or very-low income household within the past five years, state law requires that the unit be replaced and offered at a rent affordable to such household. If the rental units were rented to higher-income households, however, these restrictions do not apply. The applicant would need to provide the 5-year rental history upon application for replacement units to determine if this is applicable. Staff would need to carefully review any proposed, project -specific conditions relating to displacement and affordability. Project-specific conditions are likely to be closely scrutinized by a court for an “essential nexus” and “rough proportionality” to the impacts created by the project. This is a very difficult standard to meet. Therefore, if the Council is interested in imposing such conditions, staff would request additional time to study a specific proposal. Packet Pg. 240 AA3 City of Palo Alto (ID # 14659) City Council Staff Report Meeting Date: 8/8/2022 Report Type: OTHER INFORMATION City of Palo Alto Page 1 Title: PUBLIC HEARING: Adoption of a Resolution Confirming the Weed Abatement Report and Ordering the Cost of Abatement to be a Special Assessment on the Respective Properties Described Therein From: City Manager Lead Department: City Clerk This item has been continued to a future meeting. The Public Hearing notices will be re-issued once a date has been established. Packet Pg. 241 AA4