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HomeMy WebLinkAbout2025-08-12 Policy & Services Committee Summary MinutesPOLICY & SERVICES COMMITTEE SUMMARY MINUTES Page 1 of 6 Regular Meeting August 12, 2025 The Policy & Services Committee of the City of Palo Alto met on this date in Council Chambers and by virtual teleconference at 6:00 PM Present In-Person: Veenker (Chair), Lu, Stone Absent: None. Call to Order Chair Veenker called the meeting to order. The clerk took the roll. Public Comments No requests to speak. Agenda Items 1. Update, Discussion, and Potential Direction Regarding State and Federal Legislation, Executive Orders and Other Regulatory and Funding Activity Christine Prior, Deputy City Clerk, began a slide presentation discussing the recommendation to the Committee and legislative guidelines. Carly Shelby, Deputy Director, Townsend Public Affairs, resumed the presentation providing a 2025 state legislative session overview, end of session key items, Palo Alto areas of strategic engagement and bills with positions (SB 457 (Becker) Builder’s Remedy, SB 456 (Ashby) Contractors: exemptions: muralists, AB 650 (Papan) Housing Elements, SB 79 (Wiener) Housing development transit-oriented development, AB 306 (Rivas, Schultz) Building Standards Moratorium, SB 417 (Cabaldon) and AB 736 (Wicks): Housing Bond, AB 130 (Budget), SB 131 (Budget), SB 707 (Durazo) Brown Act Modernization Act and SB 63 (Wiener): San Francisco Bay area: local revenue measure: transportation funding). Joseph Melo joined the presentation discussing federal updates, community project request funding and impacts of OBBA. Councilmember Lu had questions about state bills. Deputy Director Shelby replied all of the existing standards embedded within the local building standard codes should remain stable so SUMMARY MINUTES Page 2 of 6 Policy & Services Committee Meeting Summary Minutes: 8/12/2025 long as they adhere to the mixed fuel use or incentivizing all electric construction. City Attorney Stump added there are considerable unknowns about exactly what this language means and how the state agencies will interpret and apply it. The utilities and sustainability groups have been looking at this very closely. Staff believe there are good arguments to move forward under the language of the statute that will fall under an exception. Staff is going to accelerate some of the changes and they will come to Council more quickly in hopes to qualify for a second reason to move forward with those to get them in place by the deadline in the statute. Chair Veenker stated the issue of the language being focused on is more about incentivizing all electric construction than the mixed fuel. There are a lot of differing opinions about whether the City falls into that exception. The better approach is the one being currently followed. Councilmember Lu was optimistic that few people would challenge the City indicating the previous code was equivalent to incentivizing all electric construction. The mechanism would be to try to dispute the language of the code and state requirements which seems intractable and untenable. City Attorney Stump believed the step before that would be where the state agency will have some input into accepting a newly passed amendment but what Councilmember Lu described was another way a challenge could be brought. Chair Veenker noted the latest buzz about cleanup language was maybe but not this year. Deputy Director Shelby understood there would be some form of cleanup language for AB 130 and SB 131 but did not know if it pertained to the local building standards moratorium. The onus is on the California Building Standards Commission to accept or reject any subsequent amendment. There would be some kind of rulemaking process getting everyone on the same page before this goes into effect. Councilmember Lu inquired about SB 79. Deputy Director Shelby stated the senator’s office has been working with local stakeholders on a number of issues. Issues being worked on include alternative compliance plans and requiring TOD zoning changes occur within the housing element compliance process. There are concerns about some of the high fire severity zones, where the transit stops are and how they overlay into the sensitive areas, the egress route requirements and the historic designation carveouts. Councilmember Lu felt the local TOD option minimized the impact to Palo Alto with the exception of Old Palo Alto where under a local TOD, the transit minimum density could be reduced to 50 percent of what would be allowed under SB 79 so there could be three or four story buildings adjacent to the Caltrain Station on the other side of Alma. Some refinement could be asked to bring that 50 percent number to something more accommodating to have extra flexibility to the local TOD plan. Councilmember Stone assumed the comments of one Council member on Policy and Services would not change how Staff would advocate for this position. Deputy City Manager Cotton Gaines explained Staff would align it with the position being taken so far. Chair Veenker asked about Caltrain. It was Councilmember Lu’s understanding that the buses on El Camino would not qualify as any Tier 1, 2 or 3 transit. There was something about one of those tiers needing dedicated bus lanes or something the City did not qualify for. Deputy City Manager Cotton Gaines agreed to follow up with that information. SUMMARY MINUTES Page 3 of 6 Policy & Services Committee Meeting Summary Minutes: 8/12/2025 Councilmember Stone queried if there are a certain amount of days between being able to call a special election and when it would happen. Deputy Director Shelby answered the Governor would likely target November 4 for the special election. The Governor has made calls to Governor Abbott in Texas and Donald Trump to stand down. There will be trigger provisions embedded within the language. Chair Veenker was curious about the thinking about manufacturing facilities. Deputy Director Shelby agreed to get the specifics on that issue. Chair Veenker asked for an update on the lawsuit Council voted to join regarding the DOJ Sanctuary list. City Attorney Stump replied the court accepted the batch of 33 new plaintiffs who wanted to join that lawsuit, including the City. A motion to have the injunction expanded to include the additional plaintiffs is pending. Chair Veenker inquired who the grants in question would apply to. Mr. Melo stated the grants would apply to all grantees but each agency still has to absorb this EO and issue additional guidance. Chair Veenker assumed it could be a far reaching EO. Mr. Melo explained the tighter restrictions on indirect cost recovery would impact research institutions the heaviest. It will impact grantees beyond government entities. Chair Veenker questioned the status of the letter related to the Metropolitan Planning Organization service transportation reauthorization. Deputy City Clerk Prior indicated the letter was being reviewed by department staff and would be sent to Council when a draft was ready. Chair Veenker asked for a explanation of the term “project placement” on the slide talking about clean energy. Mr. Melo stated it referred to project placed in service. Deputy City Manager Cotton Gaines noted if the Committee had concerns about any other bills not on the list to send those to herself or Ms. Prior. NO ACTION TAKEN 2. Office of the City Auditor Presentation of the Purchasing Card Audit Report Nick Martinez, Senior Auditor, Baker Tilly, provided a slide presentation including audit objectives, a background of the City’s P-Card program, finding 1: policy adherence and training with recommendations, finding 2: oversight and administrative gaps with recommendations and additional observations. Councilmember Lu asked if cost splitting was the only issue identified. Kate Murdock, City Auditor, replied a few other minor issues were identified but there were no instances of people misusing cards for personal use or violating policy. Cost splitting instances were few. Cost splitting was a purchase split on two different days by the same card user or two employees SUMMARY MINUTES Page 4 of 6 Policy & Services Committee Meeting Summary Minutes: 8/12/2025 putting half expenses on two different cards. No cost splitting was seen below the $1000 threshold level. Senior Auditor Martinez added the City’s current practice reviews suspicious- looking transactions in ASD’s review. Councilmember Lu commented raising the threshold made sense. Councilmember Lu wanted an explanation of the 61 denominator in the staff report. City Auditor Murdock answered 61 of the 203 transactions were followed up on. These were the results of ASD’s review process. Approximately 30 required additional follow-up with the cardholders and 10 were cost splitting violations. David Ramberg, Assistant Director, Administrative Services Department, added a monthly review of P-card transactions is done looking at any transaction over $1000 as well as IT type transactions. Cost splitting violations are tracked in a worksheet. Components are being added to that worksheet. The user is reminded of the rules which usually clears up the issue. On occasion, there are repeat offenders and that process is repeated. Efforts are being made to enhance the consequence process including canceling or revoking someone’s card in extreme circumstances. It is 1 percent of total transactions for a time period. There were about 1300 charges in that month. City Auditor Murdock agreed it would be more accurate to calculate 10 transactions out of the 203 sampled which would be a rate of about 4.9 percent. Councilmember Lu observed that the numbers are not clear. Assistant Director Ramberg added that cost splitting is an unusual instance in a month. It is unusual to have 10 in a month. If the threshold were to be raised, that would give more bandwidth for making purchases and bring down instances of cost splitting. Deputy City Manager Cotton Gaines added the City Auditor’s office is working separately at another audit related to the spending authorities. There is opportunity to raise the limit if there is interest. Chair Veenker asked for a sense of timing of having the policy in place and active for noncompliance. Assistant Director Ramberg answered November 2025 was the target date for findings 1 and 2. Chair Veenker asked about the recommendation to increase the limit. Deputy City Manager Cotton Gaines replied another audit has been kicked off focused on the purchasing authorities looking at what the cap amount is that can be approved for contracts and other things. That would be a good opportunity if there is interest in changing this threshold. City Auditor Murdock clarified it is an advisory project and not an audit. As part of the FY 26 Annual Audit Plan, this is one of the projects brought forth. Contract solicitation thresholds and authority levels are being looked at. Benchmarking studies are being done to see what those levels are in other cities. Quantitative analyses are being done to see the natural breaking points that would make sense in Palo Alto. It is not under the purview of ASD to change municipal code so it will be a different process to make that change. Councilmember Lu commented a simple narrative on when recommendations are made would be useful for future presentations. MOTION: Councilmember Stone moved, seconded by Vice Mayor Veenker, to recommend the City Council accept the results of the Purchasing Card Audit Report. MOTION PASSED: 3-0 SUMMARY MINUTES Page 5 of 6 Policy & Services Committee Meeting Summary Minutes: 8/12/2025 3. Recommend City Council Approval to Extend the Deadline for Two FY2024 Audit Project Task Orders and Amend the FY2024 and FY2025 Task Order Budgets to Realign the Authorized Budgets with a Net Zero Impact City Auditor Murdock provided a slide presentation outlining the recommendations of the City Auditor. Chair Veenker asked about the $1500 for emergency preparedness. City Auditor Murdock explained there was need to realign the budget as the task had gone over budget. Councilmember Lu wanted to know what follow-up audit activities meant. City Auditor Murdock stated follow-up audit activities was a period look at the previous audits done to see the status of recommendations. MOTION: Councilmember Lu moved, seconded by Councilmember Stone, to recommend the City Council approve the extension of the following task orders from the FY2024 Audit Plan. Requesting the deadline for these projects be extended from June 30, 2025 through October 31, 2025: • FY2024 Task 4.25: Emergency Preparedness (Wildfire) • FY2024 Task 4.28: Dispatch Center Assessment The P&S Committee Recommend City Council approve the amendment of the FY2024 and FY2025 task order budgets to realign budgets with a net zero impact: • FY 2025 Task 4.34: Follow-Up Audit Activities - decrease budget by $14,500 • FY 2024 Task 4.25: Emergency Preparedness (Wildfire) - increase by $1,500 • FY 2024 Task 4.28: Dispatch Center Assessment - increase by $13,000 MOTION PASSED: 3-0 4. Wellness and Belonging Update Report to the Policy and Services Committee; CEQA Status – Not a Project Item 4 Public Comment Kojo Pierce, Wellness and Belonging Program Manager, and Deputy City Manager Cotton Gaines provided a slide presentation including the Staff recommendations, a background of the equity efforts, Wellness and Belonging Action Plan updates, select Action Plan updates, CEDAW Ordinance (action plan item 3.4) and religious tolerance training (no action plan number). Item 4 Public Comment SUMMARY MINUTES Page 6 of 6 Policy & Services Committee Meeting Summary Minutes: 8/12/2025 1. Ken H., health professional, supported the efforts of the schools and City liaison committee to continue work with the Jed Foundation. Councilmember Stone asked when the contract for religious tolerance trainings would be completed and had questions about them. Deputy City Manager Cotton Gaines indicated the hope was to be able to do the trainings in October. Expanding the trainings for members of the public would be a budget discussion. There was interest in making the trainings mandatory but there are complications in making it mandatory. Councilmember Stone hoped the trainings could be scheduled at differing hours taking into account Board, Commission and Council members that work during the day. Councilmember Stone queried where mental health efforts fit in the plan and observed not seeing it in the plan. Deputy City Manager Cotton Gaines indicated the equity and inclusion updates are in line with the wellness and belonging work. Most of the updates with mental health are with the Council priority objectives. Councilmember Lu wanted to know of wellness and belonging type questions were covered in the survey questions. Deputy City Manager Cotton Gaines agreed to share a link of the survey for the Committee. Chair Veenker inquired how the quarterly interactive training for Staff was sorted out regarding who is invited when. Mr. Pierce replied an email was drafted in collaboration with HR to be sent to all employees. Turnout numbers were provided. There are options for 9:00 to 12:00 and 1:00 to 3:00. The trainings have been shortened from 3 to 2 hours and consideration is being made to make them 90 minutes. Chair Veenker wondered if there was a core of the same people that go to all of them. Deputy City Manager Cotton Gaines confirmed that is why there is desire to formalize the trainings more with HR. Chair Veenker asked about the possibility of opening the trainings to the community. Deputy City Manager Cotton Gaines said Council direction after the HRC discussion was to offer to Staff and the Boards and Commission members. That was expanded to include City Council. The idea is to encourage the City organization to deepen understanding. Deputy City Manager Cotton Gaines indicated the report could be forwarded to Council as an informational item. NO ACTION TAKEN Future Meetings and Agendas Deputy City Manager Cotton Gaines announced there will be a special meeting on August 25 discussing impacts related to oversized vehicles. Adjournment: The meeting was adjourned at 8:10 PM